Deluxe Corporation (DLX) has reported a 3.16 percent rise in profit for the quarter ended Sep. 30, 2016. The company has earned $58.70 million, or $1.19 a share in the quarter, compared with $56.90 million, or $1.13 a share for the same period last year. On an adjusted basis, earnings per share were at $1.22 for the quarter compared with $1.16 in the same period last year. Revenue during the quarter grew 4.34 percent to $458.90 million from $439.80 million in the previous year period. Gross margin for the quarter contracted 2 basis points over the previous year period to 63.76 percent. Total expenses were 79.89 percent of quarterly revenues, up from 79.67 percent for the same period last year. That has resulted in a contraction of 21 basis points in operating margin to 20.11 percent.
Operating income for the quarter was $92.30 million, compared with $89.40 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $118.80 million compared with $111.20 million in the prior year period. At the same time, adjusted EBITDA margin improved 60 basis points in the quarter to 25.89 percent from 25.28 percent in the last year period.
"Our strategy of diversifying and growing top-line revenue continued to show progress in the quarter with marketing solutions and other services now accounting for over a third of total revenue," said Lee Schram, chief executive officer of Deluxe. "During the quarter, we acquired Payce Payroll - a full service payroll and tax filing firm and Inkhead - a technology-based marketer that helps small businesses promote their business. Looking ahead into next year, we believe we continue to be well positioned to deliver another year of growth in revenue, earnings and cash flow from operations."
For financial year 2016, Deluxe Corporation expects revenue to be in the range of $1,850 million to $1,860 million. The company projects diluted earnings per share to be in the range of $4.78 to $4.83. It company projects diluted earnings per share to be in the range of $4.95 to $5 on adjusted basis.
For the fourth-quarter 2016, Deluxe Corporation expects revenue to be in the range of $481 million to $491 million. The company projects diluted earnings per share to be in the range of $1.23 to $1.28. On an adjusted basis, the company projects diluted earnings per share to be in the range of $1.34 to $1.39.
Operating cash flow declines
Deluxe Corporation has generated cash of $208.10 million from operating activities during the nine month period, down 5.06 percent or $11.10 million, when compared with the last year period.
The company has spent $90.40 million cash to meet investing activities during the nine month period as against cash outgo of $75.70 million in the last year period.
The company has spent $103 million cash to carry out financing activities during the nine month period as against cash outgo of $135.10 million in the last year period.
Cash and cash equivalents stood at $80.10 million as on Sep. 30, 2016, up 27.34 percent or $17.20 million from $62.90 million on Sep. 30, 2015.
Debt moves up
Deluxe Corporation has witnessed an increase in total debt over the last one year. It stood at $617.80 million as on Sep. 30, 2016, up 19.68 percent or $101.60 million from $516.20 million on Sep. 30, 2015. Total debt was 31.83 percent of total assets as on Sep. 30, 2016, compared with 30.50 percent on Sep. 30, 2015. Debt to equity ratio was at 0.73 as on Sep. 30, 2016, up from 0.72 as on Sep. 30, 2015. Interest coverage ratio deteriorated to 18.84 for the quarter from 20.32 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
