Argan, Inc. (AGX) has reported a 68.64 percent jump in profit for the quarter ended Apr. 30, 2017. The company has earned $20.62 million, or $1.31 a share in the quarter, compared with $12.23 million, or $0.81 a share for the same period last year. Revenue during the quarter surged 76.83 percent to $230.49 million from $130.35 million in the previous year period. Gross margin for the quarter contracted 432 basis points over the previous year period to 17.40 percent. Total expenses were 86.72 percent of quarterly revenues, up from 83.69 percent for the same period last year. That has resulted in a contraction of 303 basis points in operating margin to 13.28 percent.
Operating income for the quarter was $30.61 million, compared with $21.26 million in the previous year period.
Commenting on Argan’s results, Rainer Bosselmann, chairman and chief executive officer, stated, "This represents the eighth consecutive quarter of increasing revenues, fourth consecutive quarter with over $18 million in net income for our shareholders and fifth consecutive quarter of increasing net liquidity which stands at over $259 million today. As I have noted before, this consistent growth and the Company’s record success during these periods could not have been achieved without the operational excellence of our employees. We are committed to maintaining both the Company and employee successes; we are hard at work executing on our current projects; and we are focused on adding new projects to the backlog."
Working capital increases sharply
Argan, Inc. has recorded an increase in the working capital over the last year. It stood at $258.99 million as at Apr. 30, 2017, up 41.70 percent or $76.21 million from $182.78 million on Apr. 30, 2016. Current ratio was at 1.67 as on Apr. 30, 2017, down from 1.84 on Apr. 30, 2016. Days sales outstanding went down to 27 days for the quarter compared with 47 days for the same period last year.
At the same time, days payable outstanding went down to 38 days for the quarter from 43 for the same period last year.
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