DENTSPLY SIRONA Inc. (XRAY) has reported a 9.47 percent rise in profit for the quarter ended Sep. 30, 2016. The company has earned $92.50 million, or $0.39 a share in the quarter, compared with $84.50 million, or $0.59 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $155.60 million, or $0.66 a share compared with $93.80 million or $0.66 a share, a year ago.
Revenue during the quarter surged 47.05 percent to $954.20 million from $648.90 million in the previous year period. Gross margin for the quarter contracted 312 basis points over the previous year period to 53.83 percent. Total expenses were 86.73 percent of quarterly revenues, up from 84.81 percent for the same period last year. That has resulted in a contraction of 193 basis points in operating margin to 13.27 percent.
Operating income for the quarter was $126.60 million, compared with $98.60 million in the previous year period.
However, the adjusted operating income for the quarter stood at $195.80 million compared to $132.40 million in the prior year period. At the same time, adjusted operating margin improved 12 basis points in the quarter to 20.52 percent from 20.40 percent in the last year period.
Jeffrey T. Slovin, Dentsply Sirona's chief executive officer commented: "During the third quarter, we made substantial progress on our integration activities and continued making investments that will generate growth. Rest of World led the way on top of strong double digit growth last year. Our U.S. business declined as the softness others experienced earlier impacted purchase orders we received this quarter. At the end user level, our products are growing. This should translate into accelerating growth in the fourth quarter."
For financial year 2016, DENTSPLY SIRONA Inc. projects diluted earnings per share to be in the range of $2.75 to $2.80 on adjusted basis.
Operating cash flow declines
DENTSPLY SIRONA Inc. has generated cash of $341 million from operating activities during the nine month period, down 8.09 percent or $30 million, when compared with the last year period.
Cash flow from investing activities was $106.60 million for the nine month period, up 707.58 percent or $93.40 million, when compared with the last year period. It has incurred net capital expenditure of $75.20 million on net basis during the nine month period, up 46.30 percent or $23.80 million from year ago period.
The company has spent $413.50 million cash to carry out financing activities during the nine month period as against cash outgo of $294 million in the last year period.
Cash and cash equivalents stood at $330.70 million as on Sep. 30, 2016, up 39.89 percent or $94.30 million from $236.40 million on Sep. 30, 2015.
Working capital increases sharply
DENTSPLY SIRONA Inc. has recorded an increase in the working capital over the last year. It stood at $1,071.40 million as at Sep. 30, 2016, up 290.03 percent or $796.70 million from $274.70 million on Sep. 30, 2015. Current ratio was at 2.39 as on Sep. 30, 2016, up from 1.29 on Sep. 30, 2015.
Days sales outstanding went down to 54 days for the quarter compared with 62 days for the same period last year.
Days inventory outstanding has decreased to 58 days for the quarter compared with 121 days for the previous year period.
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