Bright Horizons Family Solutions Inc. (BFAM) has reported a 9.50 percent rise in profit for the quarter ended Sep. 30, 2016. The company has earned $22.51 million, or $0.37 a share in the quarter, compared with $20.56 million, or $0.33 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $29.27 million, or $0.49 a share compared with $26.51 million or $0.43 a share, a year ago.
Revenue during the quarter grew 4.91 percent to $383.93 million from $365.94 million in the previous year period. Gross margin for the quarter expanded 49 basis points over the previous year period to 23.83 percent. Total expenses were 88.35 percent of quarterly revenues, down from 88.59 percent for the same period last year. This has led to an improvement of 24 basis points in operating margin to 11.65 percent.
Operating income for the quarter was $44.72 million, compared with $41.74 million in the previous year period.
However, the adjusted operating income for the quarter stood at $44.87 million compared to $41.91 million in the prior year period. At the same time, adjusted operating margin improved 24 basis points in the quarter to 11.69 percent from 11.45 percent in the last year period.
"We are pleased to report strong financial results for the third quarter of 2016 which continue to reflect positive momentum across our suite of solutions," said David Lissy, chief executive officer. "We continue to deliver solid financial results while providing our employer clients and the working families that we serve with the high quality, critical supports they need to maximize their productivity."
For the financial year 2016, Bright Horizons Family Solutions Inc. projects revenue to grow at 7 percent for the financial year 2016. It expects adjusted net income to grow in the range of $12 percent to $14 percent.
Operating cash flow improves
Bright Horizons Family Solutions has generated cash of $164.95 million from operating activities during the nine month period, up 15.95 percent or $22.69 million, when compared with the last year period.
The company has spent $72.77 million cash to meet investing activities during the nine month period as against cash outgo of $128.05 million in the last year period.
The company has spent $83.02 million cash to carry out financing activities during the nine month period as against cash outgo of $80.51 million in the last year period.
Cash and cash equivalents stood at $19.48 million as on Sep. 30, 2016, down 8.92 percent or $1.91 million from $21.39 million on Sep. 30, 2015.
Working capital remains negative
Working capital of Bright Horizons Family Solutions Inc. was negative $162.98 million on Sep. 30, 2016 compared with negative $148.47 million on Sep. 30, 2015. Current ratio was at 0.47 as on Sep. 30, 2016, down from 0.53 on Sep. 30, 2015.
Days sales outstanding were almost stable at 18 days for the quarter, when compared with the last year period.
Debt remains almost stable
Total debt of Bright Horizons Family Solutions Inc. remained almost stable for the quarter at $939.91 million, when compared with the last year period. Total debt was 44.15 percent of total assets as on Sep. 30, 2016, compared with 43.79 percent on Sep. 30, 2015. Debt to equity ratio was at 1.35 as on Sep. 30, 2016, up from 1.32 as on Sep. 30, 2015. Interest coverage ratio improved to 4.26 for the quarter from 4.04 for the same period last year.
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