Computer Sciences Corporation (CSC) has reported 91.23 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $15 million, or $0.10 a share in the quarter, compared with $171 million, or $1.21 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $88 million, or $0.61 a share compared with $163 million or $1.14 a share, a year ago. Revenue during the quarter grew 7.22 percent to $1,871 million from $1,745 million in the previous year period. Gross margin for the quarter contracted 196 basis points over the previous year period to 27.15 percent. Total expenses were 98.93 percent of quarterly revenues, up from 96.05 percent for the same period last year. That has resulted in a contraction of 289 basis points in operating margin to 1.07 percent.
Operating income for the quarter was $20 million, compared with $69 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $120 million compared with $117 million in the prior year period. At the same time, adjusted EBITDA margin contracted 29 basis points in the quarter to 6.41 percent from 6.70 percent in the last year period.
“In the second quarter, CSC delivered revenue growth and sequential margin improvement as we continue to execute on our transformation strategy," said Mike Lawrie, chairman, president and CEO. "We have integrated our recent acquisitions, and are growing our next generation offerings, such as Business Process Services. Recent wins such as MetLife are a strong confirmation of our leadership in the insurance market and other sectors. Today, we announced a global alliance with PwC to deliver end-to-end digital transformation solutions to our clients. Finally, we remain on track to close our proposed merger with the Enterprise Services business of Hewlett Packard Enterprise on or about April 1st.”
Operating cash flow drops significantly
Computer Sciences Corporation has generated cash of $242 million from operating activities during the first half, down 50 percent or $242 million, when compared with the last year period. The company has spent $721 million cash to meet investing activities during the first six months as against cash outgo of $481 million in the last year period.
Cash flow from financing activities was $376 million for the first six months as against cash outgo of $256 million in the last year period.
Cash and cash equivalents stood at $1,054 million as on Sep. 30, 2016, down 42.02 percent or $764 million from $1,818 million on Oct. 02, 2015.
Working capital drops significantly
Computer Sciences Corporation has witnessed a decline in the working capital over the last year. It stood at $625 million as at Sep. 30, 2016, down 41.48 percent or $443 million from $1,068 million on Oct. 02, 2015. Current ratio was at 1.23 as on Sep. 30, 2016, down from 1.32 on Oct. 02, 2015.
Days sales outstanding went down to 98 days for the quarter compared with 111 days for the same period last year.
At the same time, days payable outstanding went down to 23 days for the quarter from 31 for the same period last year.
Debt increases substantially
Computer Sciences Corporation has witnessed an increase in total debt over the last one year. It stood at $3,300 million as on Sep. 30, 2016, up 26.44 percent or $690 million from $2,610 million on Oct. 02, 2015. Total debt was 37.42 percent of total assets as on Sep. 30, 2016, compared with 26.07 percent on Oct. 02, 2015. Debt to equity ratio was at 1.42 as on Sep. 30, 2016, up from 0.86 as on Oct. 02, 2015. Interest coverage ratio deteriorated to 0.69 for the quarter from 2.38 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
