Invacare Corporation (IVC) saw its loss widen to $17.64 million, or $0.54 a share for the quarter ended Dec. 31, 2016. In the previous year period, the company reported a loss of $2.93 million, or $0.09 a share. On the other hand, adjusted net loss for the quarter widened to $14.98 million, or $0.46 a share from a loss of $2.86 million or $0.09 a share, a year ago. Revenue during the quarter dropped 12.89 percent to $246.74 million from $283.26 million in the previous year period. Gross margin for the quarter contracted 67 basis points over the previous year period to 27.86 percent. Operating margin for the quarter stood at negative 2.81 percent as compared to a positive 0.53 percent for the previous year period.
Operating loss for the quarter was $6.94 million, compared with an operating income of $1.51 million in the previous year period.
Commenting on the company's financial results for the fourth quarter and year ended December 31, 2016, Matthew E. Monaghan, chairman, president and chief executive officer, stated, "The results of the fourth quarter show the combined impact of our strategic investments on top of sales decline. During the quarter, we accomplished a lot of the heavy lifting for this transformation. We on-boarded and trained a substantially new U.S. sales team at the same time we shifted product mix and discontinued a significant amount of non-core business. We launched new products and made substantial progress on our quality remediation related to the consent decree. Compared with 2015, which was better for cash flow and operating income, our 2016 results show the near-term impact of the investments required to re-orient our business. These investments are in the early phases of gaining traction, which we expect will show results later in 2017 and be more substantive in 2018. In the meantime, the company has begun taking actions to streamline operations and resize and reshape the organization, especially in North America, around its new business mix and size."
Debt increases substantially
Invacare Corporation has witnessed an increase in total debt over the last one year. It stood at $161.35 million as on Dec. 31, 2016, up 242.42 percent or $114.23 million from $47.12 million on Dec. 31, 2015. Total debt was 17.85 percent of total assets as on Dec. 31, 2016, compared with 5.62 percent on Dec. 31, 2015. Debt to equity ratio was at 0.38 as on Dec. 31, 2016, up from 0.10 as on Dec. 31, 2015.
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