AMCON Distributing Company (DIT) has reported a 57.40 percent plunge in profit for the quarter ended Mar. 31, 2017. The company has earned $0.49 million, or $0.71 a share in the quarter, compared with $1.15 million, or $1.61 a share for the same period last year.
Revenue during the quarter went down marginally by 0.81 percent to $294.05 million from $296.45 million in the previous year period. Gross margin for the quarter expanded 3 basis points over the previous year period to 5.94 percent. Total expenses were 99.62 percent of quarterly revenues, up from 99.26 percent for the same period last year. That has resulted in a contraction of 36 basis points in operating margin to 0.38 percent.
Operating income for the quarter was $1.12 million, compared with $2.19 million in the previous year period.
"We continue to invest in our wholesale business to enhance our leadership position in the convenience distribution industry. We are expanding our foodservice and technology capabilities as the needs of our customers grow in complexity. This approach has served to differentiate us from our competition," said Christopher H. Atayan, AMCON's chairman and chief executive officer. He further noted, "We are actively seeking acquisitions that can benefit from our extensive platform of customer service and are evaluating several geographic growth opportunities as our customer base expands."
Operating cash flow improves marginally
AMCON Distributing Company has generated cash of $7.66 million from operating activities during the first half, up 4.20 percent or $0.31 million, when compared with the last year period.
The company has spent $0.81 million cash to meet investing activities during the first six months as against cash outgo of $0.64 million in the last year period. It has incurred net capital expenditure of $0.81 million on net basis during the first six months, up 25.10 percent or $0.16 million from year ago period.
The company has spent $7.21 million cash to carry out financing activities during the first six months as against cash outgo of $6.61 million in the last year period.
Cash and cash equivalents stood at $0.25 million as on Mar. 31, 2017, down 22.74 percent or $0.07 million from $0.32 million on Mar. 31, 2016.
Working capital declines
AMCON Distributing Company has witnessed a decline in the working capital over the last year. It stood at $56.41 million as at Mar. 31, 2017, down 15.16 percent or $10.08 million from $66.49 million on Mar. 31, 2016. Current ratio was at 3.12 as on Mar. 31, 2017, down from 3.66 on Mar. 31, 2016.
Cash conversion cycle (CCC) has decreased to 11 days for the quarter from 20 days for the last year period. Days sales outstanding were almost stable at 9 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 7 days for the quarter compared with 16 days for the previous year period. At the same time, days payable outstanding was almost stable at 5 days for the quarter, when compared with the previous year period.
Debt comes down significantly
AMCON Distributing Company has recorded a decline in total debt over the last one year. It stood at $8.31 million as on Mar. 31, 2017, down 60.76 percent or $12.86 million from $21.17 million on Mar. 31, 2016. Total debt was 7.86 percent of total assets as on Mar. 31, 2017, compared with 18.48 percent on Mar. 31, 2016. Debt to equity ratio was at 0.12 as on Mar. 31, 2017, down from 0.34 as on Mar. 31, 2016. Interest coverage ratio deteriorated to 7.60 for the quarter from 13.59 for the same period last year.
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