HealthStream, Inc. (HSTM) has reported a 55.55 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $1.16 million, or $0.04 a share in the quarter, compared with $2.61 million, or $0.08 a share for the same period last year. On an adjusted basis, net profit for the quarter was $2.01 million, when compared with $3.88 million in the last year period.
Revenue during the quarter grew 8.42 percent to $58.37 million from $53.84 million in the previous year period. Gross margin for the quarter expanded 31 basis points over the previous year period to 57.36 percent. Total expenses were 97.80 percent of quarterly revenues, up from 91.97 percent for the same period last year. That has resulted in a contraction of 583 basis points in operating margin to 2.20 percent.
Operating income for the quarter was $1.29 million, compared with $4.32 million in the previous year period.
However, the adjusted operating income for the quarter stood at $2.47 million compared to $6.42 million in the prior year period. At the same time, adjusted operating margin contracted 770 basis points in the quarter to 4.23 percent from 11.93 percent in the last year period.
"Having held our 12th customer Summit last week where we hosted a record number of customers, partners, and prospective customers in Nashville, we are enthused by the impact our solutions are having to support the healthcare workforce," said Robert A. Frist, Jr., chief executive officer, HealthStream. "Alongside our Summit, we concurrently hosted a nationwide Echo Users Group meeting with approximately 170 participants, which included some of our new employees from Morrisey Associates��"a company we acquired and welcomed to HealthStream in August."
For financial year 2016, HealthStream, Inc. forecasts revenue to be in the range of $18 million to $19 million. The company forecasts operating income to grow in the range of 45 percent to 55 percent.
Operating cash flow drops significantly
HealthStream, Inc. has generated cash of $14.98 million from operating activities during the nine month period, down 41.29 percent or $10.54 million, when compared with the last year period.
The company has spent $57.62 million cash to meet investing activities during the nine month period as against cash outgo of $140.75 million in the last year period.
Cash flow from financing activities was $0.44 million for the nine month period, down 99.56 percent or $100.23 million, when compared with the last year period.
Cash and cash equivalents stood at $39.82 million as on Sep. 30, 2016, down 40.96 percent or $27.62 million from $67.44 million on Sep. 30, 2015.
Working capital drops significantly
HealthStream, Inc. has witnessed a decline in the working capital over the last year. It stood at $77.84 million as at Sep. 30, 2016, down 33.01 percent or $38.36 million from $116.20 million on Sep. 30, 2015. Current ratio was at 1.82 as on Sep. 30, 2016, down from 2.36 on Sep. 30, 2015.
Days sales outstanding went up to 66 days for the quarter compared with 60 days for the same period last year.
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