Hub Group, Inc. (HUBG) has reported a 42.48 percent plunge in profit for the quarter ended Mar. 31, 2017. The company has earned $10.33 million, or $0.31 a share in the quarter, compared with $17.96 million, or $0.51 a share for the same period last year.
Revenue during the quarter grew 10.87 percent to $893.45 million from $805.86 million in the previous year period. Gross margin for the quarter contracted 208 basis points over the previous year period to 11.37 percent. Total expenses were 98.08 percent of quarterly revenues, up from 96.42 percent for the same period last year. That has resulted in a contraction of 166 basis points in operating margin to 1.92 percent.
Operating income for the quarter was $17.18 million, compared with $28.84 million in the previous year period.
"Despite the current challenging market conditions, we remain committed to our strategy to increase market share by providing multi-modal solutions to our clients. We are making strategic investments in our people and technology to strengthen our competitive position in the market," said Dave Yeager, Hub's chairman and chief executive officer. "In addition, we continue to search for acquisitions that will further diversify our service offerings."
For fiscal year 2017, Hub Group, Inc. expects diluted earnings per share to be in the range of $1.60 to $1.80.
Operating cash flow declines
Hub Group, Inc. has generated cash of $47.70 million from operating activities during the quarter, down 5.15 percent or $ 2.59 million, when compared with the last year period.
The company has spent $5.50 million cash to meet investing activities during the quarter as against cash outgo of $4.30 million in the last year period. It has incurred capital expenditure of $5.50 million on net basis during the quarter, up 27.83 percent or $1.20 million from year ago period.
The company has spent $15.67 million cash to carry out financing activities during the quarter as against cash outgo of $53.48 million in the last year period.
Cash and cash equivalents stood at $154 million as on Mar. 31, 2017, down 23.10 percent or $46.26 million from $200.26 million on Mar. 31, 2016.
Working capital declines
Hub Group, Inc. has witnessed a decline in the working capital over the last year. It stood at $202.25 million as at Mar. 31, 2017, down 9.96 percent or $22.37 million from $224.62 million on Mar. 31, 2016. Current ratio was at 1.52 as on Mar. 31, 2017, down from 1.62 on Mar. 31, 2016.
Days sales outstanding went down to 41 days for the quarter compared with 43 days for the same period last year.
At the same time, days payable outstanding went down to 27 days for the quarter from 30 for the same period last year.
Debt moves up
Hub Group, Inc. has witnessed an increase in total debt over the last one year. It stood at $161.46 million as on Mar. 31, 2017, up 14.97 percent or $21.02 million from $140.44 million on Mar. 31, 2016. Total debt was 12.09 percent of total assets as on Mar. 31, 2017, compared with 11.10 percent on Mar. 31, 2016. Debt to equity ratio was at 0.25 as on Mar. 31, 2017, up from 0.23 as on Mar. 31, 2016. Interest coverage ratio deteriorated to 15.64 for the quarter from 31.66 for the same period last year.
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