Cambium Learning Group, Inc. (ABCD) swung to a net profit for the quarter ended Mar. 31, 2017. The company has made a net profit of $2.53 million in the quarter, against a net loss of $0.10 million in the last year period.
Revenue during the quarter grew 6.82 percent to $35.97 million from $33.67 million in the previous year period. Gross margin for the quarter expanded 308 basis points over the previous year period to 71.43 percent. Total expenses were 89.17 percent of quarterly revenues, down from 95.30 percent for the same period last year. This has led to an improvement of 613 basis points in operating margin to 10.83 percent.
Operating income for the quarter was $3.90 million, compared with $1.58 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $9 million compared with $6.44 million in the prior year period. At the same time, adjusted EBITDA margin improved 589 basis points in the quarter to 25.01 percent from 19.12 percent in the last year period.
"Cambium Learning Group delivered solid results in the first quarter, our seasonally lowest-volume quarter of the year," said John Campbell, chief executive officer. "Our 100% digital segments Learning A-Z and ExploreLearning recorded Bookings increases in the double digits, even with our ExploreLearning segment up against a very strong comparison from last year. The resilience of our emerging higher-margin business model, along with a lower interest burden, drove net income growth from a year-ago loss, and our historical first quarter Cash Income loss was flat with last year despite an overall Bookings decrease of 10%. Our solutions continue to be recognized for excellence, recently winning 15 awards, and Learning A-Z was again lauded as being one of the best places to work in Arizona. We have begun the year on strong executional footing, making selected investments in growth and building our sales pipeline as we move toward the important back-to-school season."
Working capital remains negative
Working capital of Cambium Learning Group, Inc. was negative $69.65 million on Mar. 31, 2017 compared with negative $58.30 million on Mar. 31, 2016. Current ratio was at 0.28 as on Mar. 31, 2017, down from 0.34 on Mar. 31, 2016.
Cash conversion cycle (CCC) has decreased to 23 days for the quarter from 54 days for the last year period. Days sales outstanding went down to 28 days for the quarter compared with 33 days for the same period last year.
Days inventory outstanding has decreased to 13 days for the quarter compared with 39 days for the previous year period. At the same time, days payable outstanding was almost stable at 18 days for the quarter, when compared with the previous year period.
Debt comes down
Cambium Learning Group, Inc. has recorded a decline in total debt over the last one year. It stood at $83.89 million as on Mar. 31, 2017, down 24.76 percent or $27.60 million from $111.49 million on Mar. 31, 2016. Total debt was 67.48 percent of total assets as on Mar. 31, 2017, compared with 84.59 percent on Mar. 31, 2016.
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