Engility Holdings, Inc. (EGL) swung to a net profit for the quarter ended Dec. 31, 2016. The company has made a net profit of $6.69 million, or $ 0.18 a share in the quarter, against a net loss of $238.73 million, or $6.53 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $19.18 million, or $0.51 a share compared with $24.70 million or $0.66 a share, a year ago.
Revenue during the quarter dropped 5.70 percent to $506.41 million from $537.02 million in the previous year period. Gross margin for the quarter expanded 16 basis points over the previous year period to 13.90 percent. Operating margin for the quarter period stood at positive 4.75 percent as compared to a negative 48.80 percent for the previous year period.
Operating income for the quarter was $24.06 million, compared with an operating loss of $262.07 million in the previous year period.
However, the adjusted operating income for the quarter stood at $41.76 million compared to $53.85 million in the prior year period. At the same time, adjusted operating margin contracted 178 basis points in the quarter to 8.25 percent from 10.03 percent in the last year period.
"2016 was a successful year for Engility as we significantly increased our book-to-bill ratio, hired key executives, reduced our cost of debt and implemented operational improvements," said Lynn Dugle, chief executive officer of Engility. "In addition, our strategic investments enabled us to win larger deals in higher-end markets. As we look to 2017, we have taken a prudent approach to guidance given continued protests and slow starts on large take-away contract wins."
For fiscal year 2017, Engility Holdings, Inc. forecasts revenue to be in the range of $1,950 million to $2,050 million. The company expects diluted earnings per share to be in the range of $0.75 to $0.85.
Operating cash flow improves significantly
Engility Holdings, Inc. has generated cash of $94.40 million from operating activities during the year, up 94.98 percent or $45.99 million, when compared with the last year.
The company has spent $21.45 million cash to meet investing activities during the year as against cash inflow of $5.87 million in the last year.
The company has spent $52.88 million cash to carry out financing activities during the year as against cash outgo of $31.39 million in the last year period.
Cash and cash equivalents stood at $48.24 million as on Dec. 31, 2016, up 60.67 percent or $18.21 million from $30.02 million on Dec. 31, 2015.
Working capital declines
Engility Holdings, Inc. has witnessed a decline in the working capital over the last year. It stood at $112.29 million as at Dec. 31, 2016, down 12.26 percent or $15.69 million from $127.98 million on Dec. 31, 2015. Current ratio was at 1.35 as on Dec. 31, 2016, down from 1.41 on Dec. 31, 2015.
Days sales outstanding went down to 30 days for the quarter compared with 33 days for the same period last year.
At the same time, days payable outstanding was almost stable at 5 days for the quarter, when compared with the previous year period.
Debt comes down marginally
Engility Holdings, Inc. has recorded a decline in total debt over the last one year. It stood at $1,066.94 million as on Dec. 31, 2016, down 3.22 percent or $35.54 million from $1,102.48 million on Dec. 31, 2015. Total debt was 48.53 percent of total assets as on Dec. 31, 2016, compared with 48.46 percent on Dec. 31, 2015. Debt to equity ratio was at 1.51 as on Dec. 31, 2016, down from 1.56 as on Dec. 31, 2015.
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