DTS, Inc (DTSI) swung to a net profit for the quarter ended Sep. 30, 2016. The company has made a net profit of $0.57 million, or $ 0.03 a share in the quarter, against a net loss of $2.80 million, or $0.16 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $9.74 million, or $0.52 a share compared with $5.66 million or $0.32 a share, a year ago.
Revenue during the quarter surged 58.93 percent to $48.75 million from $30.67 million in the previous year period. Gross margin for the quarter contracted 442 basis points over the previous year period to 86.77 percent. Operating margin for the quarter period stood at positive 5.19 percent as compared to a negative 7.49 percent for the previous year period.
Operating income for the quarter was $2.53 million, compared with an operating loss of $2.30 million in the previous year period.
However, the adjusted operating loss for the quarter stood at $15.15 million compared to operating profit of $8.25 million in prior year period.
"Our strong quarterly results reflect the continued successful execution of our long-term strategy across the home, mobile and automotive markets," said Jon Kirchner, chairman and chief executive officer of DTS. "During the quarter we expanded the Play-Fi ecosystem through the addition of Pioneer and Onkyo as hardware partners and announced collaboration with Amazon to bring the Alexa service to our partners in 2017. Our mobile momentum continued as we broadened an already robust partnership with Huawei to launch DTS Headphone:X as a key feature on the entirely new Huawei Nova product line. In automotive, we continued to drive increased penetration of HD Radio technology across North America, as new 2017 model year vehicles hit local dealerships, including the Hyundai Ioniq, Audi A4, Lincoln Continental and more."
Operating cash flow improves marginally
DTS, Inc has generated cash of $14.40 million from operating activities during the nine month period, up 2.59 percent or $0.36 million, when compared with the last year period.
The company has spent $10.83 million cash to meet investing activities during the nine month period as against cash outgo of $28.04 million in the last year period.
The company has spent $29.09 million cash to carry out financing activities during the nine month period as against cash outgo of $13.14 million in the last year period.
Cash and cash equivalents stood at $26.69 million as on Sep. 30, 2016, down 63.09 percent or $45.61 million from $72.30 million on Sep. 30, 2015.
Working capital drops significantly
DTS, Inc has witnessed a decline in the working capital over the last year. It stood at $22.37 million as at Sep. 30, 2016, down 75.07 percent or $67.35 million from $89.72 million on Sep. 30, 2015. Current ratio was at 1.41 as on Sep. 30, 2016, down from 3.37 on Sep. 30, 2015.
Days sales outstanding went down to 45 days for the quarter compared with 51 days for the same period last year.
At the same time, days payable outstanding went down to 67 days for the quarter from 144 for the same period last year.
Debt increases substantially
DTS, Inc has witnessed an increase in total debt over the last one year. It stood at $127.04 million as on Sep. 30, 2016, up 408.15 percent or $102.04 million from $25 million on Sep. 30, 2015. Total debt was 32.43 percent of total assets as on Sep. 30, 2016, compared with 8.92 percent on Sep. 30, 2015. Debt to equity ratio was at 0.57 as on Sep. 30, 2016, up from 0.12 as on Sep. 30, 2015.
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