Houston Wire & Cable Company (HWCC) swung to a net loss for the quarter ended Sep. 30, 2016. The company has made a net loss of $1.44 million, or $ 0.09 a share in the quarter, against a net profit of $0.68 million, or $0.04 a share in the last year period. Revenue during the quarter dropped 16.66 percent to $65.22 million from $78.26 million in the previous year period. Gross margin for the quarter contracted 214 basis points over the previous year period to 18.47 percent. Operating margin for the quarter stood at negative 2.77 percent as compared to a positive 2.28 percent for the previous year period.
Operating loss for the quarter was $1.80 million, compared with an operating income of $1.78 million in the previous year period.
Jim Pokluda, President and Chief Executive Officer commented, "Industrial market conditions including the oil and gas industry did not improve during the third quarter as demand levels remained inconsistent. Sales decreased 16.7% or approximately 10% on a metals adjusted basis from the third quarter of 2015. We estimate that Maintenance, Repair and Operations (MRO) sales increased 1% or approximately 8% on a metals adjusted basis, while project sales decreased 52% or approximately 45% on a metals adjusted basis. There was a slight uptick in activity in the latter part of the quarter as overall transaction activity, measured by invoice count, rose 1.0% over the prior year period. While transaction activity was flat with the second quarter, sales increased 4.4% sequentially."
Operating cash flow drops significantly
Houston Wire & Cable Company has generated cash of $15.96 million from operating activities during the nine month period, down 44.57 percent or $12.83 million, when compared with the last year period. The company has spent $0.96 million cash to meet investing activities during the nine month period as against cash outgo of $2.95 million in the last year period.
The company has spent $15 million cash to carry out financing activities during the nine month period as against cash outgo of $25.85 million in the last year period.
Working capital declines
Houston Wire & Cable Company has witnessed a decline in the working capital over the last year. It stood at $88.52 million as at Sep. 30, 2016, down 18.48 percent or $20.06 million from $108.58 million on Sep. 30, 2015. Current ratio was at 5.29 as on Sep. 30, 2016, down from 5.38 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 108 days for the quarter from 161 days for the last year period. Days sales outstanding went up to 70 days for the quarter compared with 63 days for the same period last year.
Days inventory outstanding has decreased to 55 days for the quarter compared with 113 days for the previous year period. At the same time, days payable outstanding went up to 17 days for the quarter from 15 for the same period last year.
Debt comes down significantly
Houston Wire & Cable Company has recorded a decline in total debt over the last one year. It stood at $29.72 million as on Sep. 30, 2016, down 27.74 percent or $11.41 million from $41.13 million on Sep. 30, 2015. Total debt was 20.96 percent of total assets as on Sep. 30, 2016, compared with 24.66 percent on Sep. 30, 2015. Debt to equity ratio was at 0.32 as on Sep. 30, 2016, down from 0.40 as on Sep. 30, 2015. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
