Hurco Companies, Inc. (HURC) has reported a 77.43 percent plunge in profit for the quarter ended Jan. 31, 2017. The company has earned $0.88 million, or $0.13 a share in the quarter, compared with $3.90 million, or $0.58 a share for the same period last year.
Revenue during the quarter dropped 13.73 percent to $48.74 million from $56.50 million in the previous year period. Gross margin for the quarter contracted 550 basis points over the previous year period to 25.82 percent. Total expenses were 97.09 percent of quarterly revenues, up from 89.85 percent for the same period last year. That has resulted in a contraction of 724 basis points in operating margin to 2.91 percent.
Operating income for the quarter was $1.42 million, compared with $5.74 million in the previous year period.
Hurco chief executive officer Michael Doar stated, "I am encouraged by the increased volume of orders we received from all product lines and geographic regions during the first quarter of fiscal 2017 compared to the first quarter of fiscal 2016. Two strong order quarters back-to-back provide us with confidence that our strategy to penetrate the market with three product lines, Hurco, Takumi and Milltronics, aligns with customer demand for quality machine tools equipped with user-friendly, yet sophisticated control technologies to advance their businesses. Additionally, our geographic reach to serve the global machine tool market proves to be an important part of our ongoing focus to provide customers with machine tools wherever they need them."
Working capital increases
Hurco Companies, Inc. has recorded an increase in the working capital over the last year. It stood at $161.77 million as at Jan. 31, 2017, up 7.17 percent or $10.82 million from $150.95 million on Jan. 31, 2016. Current ratio was at 3.88 as on Jan. 31, 2017, up from 3.42 on Jan. 31, 2016.
Cash conversion cycle (CCC) has decreased to 115 days for the quarter from 220 days for the last year period. Days sales outstanding went up to 69 days for the quarter compared with 65 days for the same period last year.
Days inventory outstanding has decreased to 150 days for the quarter compared with 256 days for the previous year period. At the same time, days payable outstanding went up to 104 days for the quarter from 101 for the same period last year.
Debt comes down marginally
Hurco Companies, Inc. has recorded a decline in total debt over the last one year. It stood at $1.45 million as on Jan. 31, 2017, down 4.47 percent or $0.07 million from $1.52 million on Jan. 31, 2016. Hurco Companies, Inc. has recorded a decline in short-term debt over the last one year. It stood at $1.45 million as on Jan. 31, 2017, down 4.47 percent or $0.07 million from $1.52 million on Jan. 31, 2016. Total debt was 0.58 percent of total assets as on Jan. 31, 2017, compared with 0.62 percent on Jan. 31, 2016. Debt to equity ratio was almost stable at 0.01 as on Jan. 31, 2017, when compared with the last year. Interest coverage ratio deteriorated to 67.57 for the quarter from 239.04 for the same period last year.
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