Arotech Corporation (ARTX) swung to a net loss for the quarter ended Dec. 31, 2016. The company has made a net loss of $2.04 million, or $ 0.08 a share in the quarter, against a net profit of $0.40 million, or $0.02 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $0.28 million, or $0.01 a share compared with $1.84 million or $0.07 a share, a year ago. Revenue during the quarter dropped 21.61 percent to $21.49 million from $27.41 million in the previous year period. Operating margin for the quarter stood at negative 8.11 percent as compared to a positive 4.36 percent for the previous year period.
Operating loss for the quarter was $1.74 million, compared with an operating income of $1.20 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $0.81 million compared with $2.58 million in the prior year period. At the same time, adjusted EBITDA margin contracted 564 basis points in the quarter to 3.76 percent from 9.40 percent in the last year period.
“Arotech concluded a transformative 2016 with further cost saving measures at both the corporate and division level,” commented acting Chief executive officer Dean Krutty. “Our Board of Directors helped drive the reduction in our cost structure with the recently negotiated separation agreement of our former Chief executive officer, which followed our previously announced decision to discontinue our Flow Battery business. We will continue to pursue streamlining our operations and our corporate cost structure in line with our commitment to bring better returns to shareholders.”
Arotech Corp expects revenue to be in the range of $93 million to $103 million for financial year 2017. For financial year 2017, the company projects diluted earnings per share to be in the range of $0.20 to $0.24 on adjusted basis.
Working capital remains almost stable
Arotech Corporation has witnessed a decline in the working capital over the last year. It stood at $23.92 million as at Dec. 31, 2016, down 0.64 percent or $0.15 million from $24.07 million on Dec. 31, 2015. Current ratio was at 2.01 as on Dec. 31, 2016, up from 1.90 on Dec. 31, 2015. Days sales outstanding went up to 60 days for the quarter compared with 50 days for the same period last year.
Debt comes down significantly
Arotech Corporation has recorded a decline in total debt over the last one year. It stood at $13.51 million as on Dec. 31, 2016, down 33.40 percent or $6.77 million from $20.28 million on Dec. 31, 2015. Total debt was 12.34 percent of total assets as on Dec. 31, 2016, compared with 17.26 percent on Dec. 31, 2015. Debt to equity ratio was at 0.21 as on Dec. 31, 2016, down from 0.32 as on Dec. 31, 2015.
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