Bel Fuse Inc. (BELFB) has reported a 97.36 percent jump in profit for the quarter ended Sep. 30, 2016. The company has earned $9.71 million in the quarter, compared with $4.92 million for the same period last year.
Revenue during the quarter dropped 10.65 percent to $128.81 million from $144.16 million in the previous year period. Gross margin for the quarter expanded 162 basis points over the previous year period to 20.63 percent. Total expenses were 92.77 percent of quarterly revenues, down from 94.93 percent for the same period last year. This has led to an improvement of 216 basis points in operating margin to 7.23 percent.
Operating income for the quarter was $9.31 million, compared with $7.31 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $14.95 million compared with $17.12 million in the prior year period. At the same time, adjusted EBITDA margin contracted 27 basis points in the quarter to 11.61 percent from 11.88 percent in the last year period.
Daniel Bernstein, president and chief executive officer, said "Our integration efforts since acquiring the Power Solutions and Connectivity Solutions businesses in 2014 have resulted in $15 million in annual fixed cost reductions in our consolidated operations since the acquisition dates. We have continued to streamline the organization and improve manufacturing processes, while enhancing the quality of our products. These efforts, and the critical mass that was achieved with the combination of the acquired entities, have contributed to the expansion of our consolidated gross margins from 19.0% to 20.6% and a substantial increase in our bottom line, despite the $15.4 million in lower sales compared to last year's third quarter."
Working capital declines
Bel Fuse Inc. has witnessed a decline in the working capital over the last year. It stood at $160.77 million as at Sep. 30, 2016, down 8.94 percent or $15.78 million from $176.56 million on Sep. 30, 2015. Current ratio was at 2.64 as on Sep. 30, 2016, up from 2.46 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 59 days for the quarter from 100 days for the last year period. Days sales outstanding went up to 65 days for the quarter compared with 61 days for the same period last year.
Days inventory outstanding has decreased to 43 days for the quarter compared with 85 days for the previous year period. At the same time, days payable outstanding went up to 50 days for the quarter from 46 for the same period last year.
Debt comes down significantly
Bel Fuse Inc. has recorded a decline in total debt over the last one year. It stood at $146.72 million as on Sep. 30, 2016, down 25.79 percent or $51 million from $197.72 million on Sep. 30, 2015. Total debt was 33.37 percent of total assets as on Sep. 30, 2016, compared with 32.63 percent on Sep. 30, 2015. Debt to equity ratio was at 0.91 as on Sep. 30, 2016, up from 0.85 as on Sep. 30, 2015. Interest coverage ratio improved to 6.05 for the quarter from 4.08 for the same period last year.
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