Evolving Systems, Inc. (EVOL) has reported a 65.09 percent jump in profit for the quarter ended Sep. 30, 2016. The company has earned $0.94 million, or $0.08 a share in the quarter, compared with $0.57 million, or $0.05 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $1.10 million, or $0.09 a share compared with $0.63 million or $0.05 a share, a year ago.
Revenue during the quarter grew 5.72 percent to $6.10 million from $5.77 million in the previous year period. Gross margin for the quarter expanded 430 basis points over the previous year period to 79.37 percent. Total expenses were 72.10 percent of quarterly revenues, down from 83.47 percent for the same period last year. This has led to an improvement of 1138 basis points in operating margin to 27.90 percent.
Operating income for the quarter was $1.70 million, compared with $0.95 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $2.01 million compared with $1.14 million in the prior year period. At the same time, adjusted EBITDA margin improved 1313 basis points in the quarter to 32.95 percent from 19.82 percent in the last year period.
"During the third quarter we booked three new orders for our customer acquisition and activation software and services, which are designed to help carriers acquire new customers and accelerate delivery of next generation services," said Thomas Thekkethala, CEO. "Two of these new orders came from new customers and were won in collaboration with a global network equipment OEM. Carriers expect more from their OEM partners in terms of acquiring and engaging customers and developing new revenue streams from next gen services. The OEMs are working closely with us to expand our joint engagements with carriers around the world.
Working capital drops significantly
Evolving Systems, Inc. has witnessed a decline in the working capital over the last year. It stood at $7.67 million as at Sep. 30, 2016, down 44.12 percent or $6.06 million from $13.73 million on Sep. 30, 2015. Current ratio was at 1.72 as on Sep. 30, 2016, down from 2.31 on Sep. 30, 2015.
Days sales outstanding went down to 93 days for the quarter compared with 131 days for the same period last year.
Debt comes down significantly
Evolving Systems, Inc. has recorded a decline in total debt over the last one year. It stood at $6 million as on Sep. 30, 2016, down 40.10 percent or $4.01 million from $10.01 million on Sep. 30, 2015. Total debt was 13.51 percent of total assets as on Sep. 30, 2016, compared with 18.68 percent on Sep. 30, 2015. Debt to equity ratio was at 0.21 as on Sep. 30, 2016, down from 0.31 as on Sep. 30, 2015. Interest coverage ratio deteriorated to 23.01 for the quarter from 318 for the same period last year.
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