Chesapeake Utilities Corporation (CPK) has reported a 13.73 percent fall in profit for the quarter ended Sep. 30, 2016. The company has earned $4.42 million, or $0.29 a share in the quarter, compared with $5.12 million, or $0.33 a share for the same period last year.
Revenue during the quarter grew 17.88 percent to $108.35 million from $91.91 million in the previous year period. Gross margin for the quarter contracted 446 basis points over the previous year period to 47.97 percent. Total expenses were 90.63 percent of quarterly revenues, up from 88.13 percent for the same period last year. That has resulted in a contraction of 250 basis points in operating margin to 9.37 percent.
Operating income for the quarter was $10.16 million, compared with $10.91 million in the previous year period.
"Third quarter results of operations met our expectations and demonstrate the success of our employees in cultivating growth in the areas we serve. The Eight Flags Energy project is now fully operational and contributed more than $2.0 million in new margin during the quarter." stated Michael P. McMasters, President and Chief Executive Officer of Chesapeake Utilities Corporation. “We also completed an equity offering which provides us with the capital we need while maintaining our strong financial position. Looking forward we are positioned to continue executing on our projects and delivering value to our customers and shareholders," Mr. McMasters added.
Working capital remains negative
Working capital of Chesapeake Utilities Corporation was negative $160.90 million on Sep. 30, 2016 compared with negative $149.17 million on Sep. 30, 2015. Current ratio was at 0.39 as on Sep. 30, 2016, up from 0.37 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 7 days for the quarter from 13 days for the last year period. Days sales outstanding went down to 45 days for the quarter compared with 46 days for the same period last year.
Days inventory outstanding has decreased to 13 days for the quarter compared with 24 days for the previous year period. At the same time, days payable outstanding went down to 65 days for the quarter from 83 for the same period last year.
Debt moves up
Chesapeake Utilities Corporation has witnessed an increase in total debt over the last one year. It stood at $310.10 million as on Sep. 30, 2016, up 6.15 percent or $17.96 million from $292.14 million on Sep. 30, 2015. Total debt was 27.19 percent of total assets as on Sep. 30, 2016, compared with 28.97 percent on Sep. 30, 2015. Debt to equity ratio was at 0.71 as on Sep. 30, 2016, down from 0.83 as on Sep. 30, 2015. Interest coverage ratio deteriorated to 3.73 for the quarter from 4.38 for the same period last year.
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