GMS Inc (GMS) swung to a net profit for the quarter ended Jan. 31, 2017. The company has made a net profit of $8.23 million, or $ 0.20 a share in the quarter, against a net loss of $2.21 million, or $0.07 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $13.13 million, or $0.32 a share compared with $6.03 million or $0.18 a share, a year ago.
Revenue during the quarter surged 33.78 percent to $562.52 million from $420.48 million in the previous year period. Gross margin for the quarter expanded 111 basis points over the previous year period to 33.02 percent. Total expenses were 96.42 percent of quarterly revenues, down from 98.59 percent for the same period last year. This has led to an improvement of 218 basis points in operating margin to 3.58 percent.
Operating income for the quarter was $20.15 million, compared with $5.91 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $40.68 million compared with $25.69 million in the prior year period. At the same time, adjusted EBITDA margin improved 112 basis points in the quarter to 7.23 percent from 6.11 percent in the last year period.
Mike Callahan, president and chief executive officer of GMS, stated, "Our multi-faceted growth strategy drove improvement across all metrics during the third quarter. Stronger residential and commercial activity, coupled with accretive share gains allowed us to generate double-digit organic revenue growth in each product group. Acquisitions further augmented this operating momentum, including our recent expansion into Indiana. On higher net sales, our national scale advantages and efficiently managed costs drove stronger gross margin and modest SG&A leverage, resulting in nearly 60% growth in Adjusted EBITDA. In addition to this progress, during the third quarter we further improved our leverage metrics and expanded our capital base on more favorable terms. Into the fourth quarter of fiscal 2017, we expect to expand our industry leading positions at attractive margins and continue to pursue accretive acquisitions."
Operating cash flow improves significantly
GMS Inc has generated cash of $36.34 million from operating activities during the nine month period, up 102.99 percent or $18.44 million, when compared with the last year period.
The company has spent $145.30 million cash to meet investing activities during the nine month period as against cash outgo of $80.94 million in the last year period.
Cash flow from financing activities was $100.50 million for the nine month period, up 72.85 percent or $42.36 million, when compared with the last year period.
Cash and cash equivalents stood at stood at $10.60 million as at Jan. 31, 2017.
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