Global Water Resources, Inc. (GWRS) swung to a net profit for the quarter ended Mar. 31, 2017. The company has made a net profit of $0.05 million in the quarter, against a net loss of $0.31 million in the last year period.
Revenue during the quarter went down marginally by 0.37 percent to $6.79 million from $6.82 million in the previous year period. Total expenses were 87.06 percent of quarterly revenues, up from 84.43 percent for the same period last year. That has resulted in a contraction of 262 basis points in operating margin to 12.94 percent.
Operating income for the quarter was $0.88 million, compared with $1.06 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $3.23 million compared with $3.09 million in the prior year period. At the same time, adjusted EBITDA margin improved 232 basis points in the quarter to 47.62 percent from 45.31 percent in the last year period.
"The continued positive trend in new and re-established connections drove adjusted revenue growth this quarter, and in combination with lower interest expense, helped generate positive net income," said the company president and chief executive officer, Ron Fleming. "Moving forward, we expect to continue to grow net income as we remain focused on improving operational efficiencies and aggressively managing controllable expenses. We will use our cash-on-hand to make targeted improvements that defer the tax liability generated by the Valencia disposition while building rate base, and further support revenue growth and reduce expenses. We continue to evaluate accretive acquisition opportunities that would also help defer the tax liability generated by the Valencia disposition. As we execute our growth plan, we will continue to assess our dividend policy based on our commitment to grow our regular dividend, as evidenced by the dividend increase we announced today."
Operating cash flow declines
Global Water Resources, Inc. has generated cash of $2.10 million from operating activities during the quarter, down 13.83 percent or $ 0.34 million, when compared with the last year period.
The company has spent $6.51 million cash to meet investing activities during the quarter as against cash outgo of $1.38 million in the last year period.
The company has spent $1.28 million cash to carry out financing activities during the quarter as against cash outgo of $1.15 million in the last year period.
Cash and cash equivalents stood at $14.81 million as on Mar. 31, 2017, up 29.68 percent or $3.39 million from $11.42 million on Mar. 31, 2016.
Working capital decreases marginally
Global Water Resources, Inc. has witnessed a decline in the working capital over the last year. It stood at $6.08 million as at Mar. 31, 2017, down 2.22 percent or $0.14 million from $6.22 million on Mar. 31, 2016. Current ratio was at 1.47 as on Mar. 31, 2017, up from 1.47 on Mar. 31, 2016.
Days sales outstanding went down to 12 days for the quarter compared with 22 days for the same period last year.
Debt moves up
Global Water Resources, Inc. has witnessed an increase in total debt over the last one year. It stood at $114.29 million as on Mar. 31, 2017, up 9.28 percent or $9.70 million from $104.58 million on Mar. 31, 2016. Total debt was 47.61 percent of total assets as on Mar. 31, 2017, compared with 44.09 percent on Mar. 31, 2016. Debt to equity ratio was at 8.03 as on Mar. 31, 2017, up from 5.82 as on Mar. 31, 2016. Interest coverage ratio improved to 0.67 for the quarter from 0.58 for the same period last year.
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