Hill-Rom Holdings, Inc. (HRC) swung to a net profit for the quarter ended Sep. 30, 2016. The company has made a net profit of $51.70 million, or $ 0.77 a share in the quarter, against a net loss of $9.60 million, or $0.16 a share in the last year period. On an adjusted basis, earnings per share were at $1.18 for the quarter compared with $0.89 in the same period last year.
Revenue during the quarter grew 23.02 percent to $706 million from $573.90 million in the previous year period. Gross margin for the quarter expanded 438 basis points over the previous year period to 49.11 percent. Operating margin for the quarter period stood at positive 13.24 percent as compared to a negative 1.01 percent for the previous year period.
Operating income for the quarter was $93.50 million, compared with an operating loss of $5.80 million in the previous year period.
"Our fourth quarter financial performance capped off a successful year for our company," said John J. Greisch, president and chief executive officer of Hill-Rom. "In 2016, we achieved our strategic objectives, exceeded our operating margin and earnings guidance and established a solid foundation for the future. We will build on this success by driving sustainable growth across a more diversified portfolio with disciplined focus on commercial and operational execution, as well as enhancing value for patients, customers and shareholders."
For financial year 2017, Hill-Rom Holdings, Inc. forecasts revenue to grow at 3 percent . The company projects diluted earnings per share to be in the range of $3.74 to $3.82 on adjusted basis.
For the first-quarter 2017, Hill-Rom Holdings, Inc. projects diluted earnings per share to be in the range of $0.75 to $0.77 on an adjusted basis.
Operating cash flow improves significantly
Hill-Rom Holdings, Inc. has generated cash of $281.20 million from operating activities during the year, up 31.52 percent or $67.40 million, when compared with the last year.
The company has spent $97.70 million cash to meet investing activities during the year as against cash outgo of $1,756.40 million in the last year. It has incurred net capital expenditure of $81.10 million on net basis during the year, down 32.30 percent or $38.70 million from year ago.
The company has spent $141.90 million cash to carry out financing activities during the year as against cash inflow of $1,642.70 million in the last year period.
Cash and cash equivalents stood at $232.20 million as on Sep. 30, 2016, up 20.44 percent or $39.40 million from $192.80 million on Sep. 30, 2015.
Working capital drops significantly
Hill-Rom Holdings, Inc. has witnessed a decline in the working capital over the last year. It stood at $419.80 million as at Sep. 30, 2016, down 25.33 percent or $142.40 million from $562.20 million on Sep. 30, 2015. Current ratio was at 1.63 as on Sep. 30, 2016, down from 1.97 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 48 days for the quarter from 59 days for the last year period. Days sales outstanding went down to 34 days for the quarter compared with 40 days for the same period last year.
Days inventory outstanding has decreased to 32 days for the quarter compared with 39 days for the previous year period. At the same time, days payable outstanding went down to 17 days for the quarter from 20 for the same period last year.
Debt comes down marginally
Hill-Rom Holdings, Inc. has recorded a decline in total debt over the last one year. It stood at $2,148.50 million as on Sep. 30, 2016, down 3.79 percent or $84.70 million from $2,233.20 million on Sep. 30, 2015. Total debt was 50.41 percent of total assets as on Sep. 30, 2016, compared with 50.10 percent on Sep. 30, 2015. Debt to equity ratio was at 1.74 as on Sep. 30, 2016, down from 1.93 as on Sep. 30, 2015.
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