Datalink Corporation (DTLK) has reported a 58.45 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $0.55 million, or $0.03 a share in the quarter, compared with $1.31 million, or $0.06 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $2.59 million, or $0.12 a share compared with $3.33 million or $0.15 a share, a year ago.
Revenue during the quarter dropped 7.10 percent to $183.97 million from $198.03 million in the previous year period. Gross margin for the quarter expanded 30 basis points over the previous year period to 17.92 percent. Total expenses were 99.73 percent of quarterly revenues, up from 98.75 percent for the same period last year. That has resulted in a contraction of 98 basis points in operating margin to 0.27 percent.
Operating income for the quarter was $0.50 million, compared with $2.48 million in the previous year period.
However, the adjusted operating income for the quarter stood at $4 million compared to $5.81 million in the prior year period. At the same time, adjusted operating margin contracted 76 basis points in the quarter to 2.18 percent from 2.94 percent in the last year period.
Operating cash flow improves significantly
Datalink Corp has generated cash of $15.36 million from operating activities during the nine month period, up 143.09 percent or $9.04 million, when compared with the last year period.
The company has spent $11.92 million cash to meet investing activities during the nine month period as against cash outgo of $6.62 million in the last year period.
Cash flow from financing activities was $2.01 million for the nine month period as against cash outgo of $3.05 million in the last year period.
Cash and cash equivalents stood at $44.85 million as on Sep. 30, 2016, up 83.97 percent or $20.47 million from $24.38 million on Sep. 30, 2015.
Working capital increases marginally
Datalink Corp has recorded an increase in the working capital over the last year. It stood at $109.50 million as at Sep. 30, 2016, up 4.85 percent or $5.07 million from $104.43 million on Sep. 30, 2015. Current ratio was at 1.44 as on Sep. 30, 2016, up from 1.41 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 47 days for the quarter from 51 days for the last year period. Days sales outstanding went up to 70 days for the quarter compared with 66 days for the same period last year.
Days inventory outstanding has decreased to 5 days for the quarter compared with 15 days for the previous year period. At the same time, days payable outstanding went down to 28 days for the quarter from 30 for the same period last year.
Debt moves up
Datalink Corp has witnessed an increase in total debt over the last one year. It stood at $39.78 million as on Sep. 30, 2016, up 11.40 percent or $4.07 million from $35.71 million on Sep. 30, 2015. Total debt was 7.93 percent of total assets as on Sep. 30, 2016, compared with 7.15 percent on Sep. 30, 2015. Debt to equity ratio was at 0.24 as on Sep. 30, 2016, up from 0.22 as on Sep. 30, 2015.
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