Delta Apparel, Inc. (DLA) has reported a 32.33 percent jump in profit for the quarter ended Apr. 01, 2017. The company has earned $4.55 million, or $0.58 a share in the quarter, compared with $3.44 million, or $0.43 a share for the same period last year.
Revenue during the quarter dropped 4.60 percent to $104.14 million from $109.16 million in the previous year period. Gross margin for the quarter contracted 30 basis points over the previous year period to 23.27 percent. Total expenses were 92.78 percent of quarterly revenues, down from 94.57 percent for the same period last year. This has led to an improvement of 179 basis points in operating margin to 7.22 percent.
Operating income for the quarter was $7.52 million, compared with $5.93 million in the previous year period.
Robert W. Humphreys, Delta Apparel, Inc.'s chairman and chief executive officer, commented, "Our fiscal 2017 second quarter was productive and we completed a number of key initiatives to further improve our business results. Earnings were up nearly 10% even after adjusting for the $0.11 per share gain from the sale of Junkfood. As we indicated last quarter, we remain focused on strategies that will drive revenue growth and improved operating margins throughout our Company."
Working capital increases
Delta Apparel, Inc. has recorded an increase in the working capital over the last year. It stood at $159.40 million as at Apr. 01, 2017, up 7.12 percent or $10.60 million from $148.80 million on Apr. 02, 2016. Current ratio was at 2.79 as on Apr. 01, 2017, down from 2.83 on Apr. 02, 2016.
Cash conversion cycle (CCC) has decreased to 76 days for the quarter from 153 days for the last year period. Days sales outstanding went up to 49 days for the quarter compared with 46 days for the same period last year.
Days inventory outstanding has decreased to 103 days for the quarter compared with 176 days for the previous year period. At the same time, days payable outstanding went up to 76 days for the quarter from 68 for the same period last year.
Debt comes down
Delta Apparel, Inc. has recorded a decline in total debt over the last one year. It stood at $97.38 million as on Apr. 01, 2017, down 15.35 percent or $17.65 million from $115.03 million on Apr. 02, 2016. Total debt was 28.86 percent of total assets as on Apr. 01, 2017, compared with 33.76 percent on Apr. 02, 2016. Debt to equity ratio was at 0.63 as on Apr. 01, 2017, down from 0.78 as on Apr. 02, 2016. Interest coverage ratio improved to 5.73 for the quarter from 4.25 for the same period last year.
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