Crexendo, Inc (EXE) saw its loss narrow to $0.62 million, or $0.05 a share for the quarter ended Sep. 30, 2016. In the previous year period, the company reported a loss of $1.04 million, or $0.08 a share. On an adjusted basis, net loss for the quarter was $0.35 million, when compared with $0.74 million in the last year period.
Revenue during the quarter grew 18.31 percent to $2.33 million from $1.97 million in the previous year period. Gross margin for the quarter expanded 478 basis points over the previous year period to 60.05 percent. Operating margin for the quarter stood at negative 26.10 percent as compared to a negative 53.35 percent for the previous year period.
Operating loss for the quarter was $0.61 million, compared with an operating loss of $1.05 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at negative $0.36 million compared to negative $0.74 million in the prior year second quarter. At the same time, adjusted EBITDA margin stood at negative 15.60 percent for the quarter compared to negative 37.42 percent in the last year period.
Steven G. Mihaylo, chief executive officer commented, “We continue to make progress. We have again increased our revenue on a quarterly basis 2016 over 2015. We also continue to increase our backlog and sequential quarterly revenue. We have continued our cost reduction initiatives and have completed a thorough review of costs. We have targeted cost reductions for software programs that we can cancel and others that we can replace with significantly more cost-effective replacements. We have also implemented other cost reduction initiatives. We believe these actions will have a very positive impact in 2017. We are also deferring planned expenditures in accounting software while we continue to work toward reaching GAAP cash flow breakeven.
Operating cash flow remains negative
Crexendo, Inc has spent $0.74 million cash to meet operating activities during the nine month period as against cash outgo of $1.97 million in the last year period.
Cash flow from investing activities was $0.01 million for the nine month period as against cash outgo of $0.02 million in the last year period.
Cash flow from financing activities was $0.08 million for the nine month period, down 87.76 percent or $0.60 million, when compared with the last year period.
Cash and cash equivalents stood at $0.85 million as on Sep. 30, 2016, down 46.46 percent or $0.74 million from $1.60 million on Sep. 30, 2015.
Working capital turns negative
Working capital of Crexendo, Inc has turned negative to $0.29 million on Sep. 30, 2016 from positive $0.80 million on Sep. 30, 2015. Current ratio was at 0.89 as on Sep. 30, 2016, down from 1.30 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 4 days for the quarter from 14 days for the last year period. Days sales outstanding went down to 18 days for the quarter compared with 24 days for the same period last year.
Days inventory outstanding has decreased to 6 days for the quarter compared with 10 days for the previous year period. At the same time, days payable outstanding was almost stable at 20 days for the quarter, when compared with the previous year period.
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