Convergys Corporation (CVG) has reported 58.92 percent plunge in profit for the quarter ended Dec. 31, 2016. The company has earned $17.50 million, or $0.17 a share in the quarter, compared with $42.60 million, or $0.41 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $47.60 million, or $0.47 a share compared with $54.60 million or $0.53 a share, a year ago. Revenue during the quarter went up marginally by 0.81 percent to $757.90 million from $751.80 million in the previous year period. Gross margin for the quarter contracted 311 basis points over the previous year period to 34.25 percent. Total expenses were 93.22 percent of quarterly revenues, up from 91.87 percent for the same period last year. That has resulted in a contraction of 135 basis points in operating margin to 6.78 percent.
Operating income for the quarter was $51.40 million, compared with $61.10 million in the previous year period.
However, the adjusted operating income for the quarter stood at $66.10 million compared to $74.50 million in the prior year period. At the same time, adjusted operating margin contracted 119 basis points in the quarter to 8.72 percent from 9.91 percent in the last year period.
"We generated solid revenue, profitability and cash flow in the fourth quarter," said Andrea Ayers, president and chief executive officer. "For 2016, adjusted EPS improved and we had a record year of new business signings. Growth across several verticals and solid margin performance despite revenue headwinds are positive indicators that our long-term strategy is on track. Strong cash generation allowed us to invest in the business while returning $105 million to shareholders via share repurchase and dividends. Entering 2017, we remain focused on generating long-term profitable growth and sustained value creation. Based upon our track record of operational excellence and disciplined investment, we are confident in our abilities to lead in customer experience outsourcing, expand and diversify a loyal client base, and grow revenue over time."
Operating cash flow improves
Convergys Corporation has generated cash of $305.40 million from operating activities during the year, up 22.50 percent or $56.10 million, when compared with the last year. The company has spent $225.70 million cash to meet investing activities during the year as against cash outgo of $108.40 million in the last year.
The company has spent $145.60 million cash to carry out financing activities during the year as against cash outgo of $135.10 million in the last year period.
Cash and cash equivalents stood at $138.80 million as on Dec. 31, 2016, down 32.19 percent or $65.90 million from $204.70 million on Dec. 31, 2015.
Debt comes down
Convergys Corporation has recorded a decline in total debt over the last one year. It stood at $298.80 million as on Dec. 31, 2016, down 11.94 percent or $40.50 million from $339.30 million on Dec. 31, 2015. Total debt was 12.60 percent of total assets as on Dec. 31, 2016, compared with 14.39 percent on Dec. 31, 2015. Debt to equity ratio was at 0.23 as on Dec. 31, 2016, down from 0.27 as on Dec. 31, 2015. Interest coverage ratio deteriorated to 11.17 for the quarter from 14.21 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
