Jazz Pharmaceuticals plc (JAZZ) has reported 0.93 percent fall in profit for the quarter ended Sep. 30, 2016. The company has earned $87.14 million, or $1.41 a share in the quarter, compared with $87.96 million, or $1.39 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $158.47 million, or $2.57 a share compared with $159.30 million or $2.52 a share, a year ago.
Revenue during the quarter grew 9.77 percent to $374.18 million from $340.87 million in the previous year period. Gross margin for the quarter expanded 183 basis points over the previous year period to 93.50 percent. Total expenses were 63.59 percent of quarterly revenues, up from 61.41 percent for the same period last year. That has resulted in a contraction of 217 basis points in operating margin to 36.41 percent.
Operating income for the quarter was $136.25 million, compared with $131.53 million in the previous year period.
"We have made substantial progress towards achieving our corporate objectives for 2016, delivering solid top-line growth in our commercial business, investing in broadening our hematology/oncology portfolio with the completion of the Celator acquisition and increasing our investments in R&D," said Bruce Cozadd, chairman and chief executive officer of Jazz Pharmaceuticals.
For fiscal year 2016, Jazz Pharmaceuticals forecasts revenue to be in the range of $1,485 million to $1,530 million. The company projects net income to be in the range of $351 million to $407 million. The company expects adjusted net income to be in the range of $615 million to $640 million. The company expects diluted earnings per share to be in the range of $5.66 to $6.56. The company expects diluted earnings per share to be in the range of $9.90 to $10.30 on adjusted basis.
Working capital drops significantly
Jazz Pharmaceuticals plc has witnessed a decline in the working capital over the last year. It stood at $511.37 million as at Sep. 30, 2016, down 47.54 percent or $463.38 million from $974.75 million on Sep. 30, 2015. Current ratio was at 3.20 as on Sep. 30, 2016, down from 3.87 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 31 days for the quarter from 61 days for the last year period. Days sales outstanding were almost stable at 53 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 61 days for the quarter compared with 99 days for the previous year period. At the same time, days payable outstanding went down to 83 days for the quarter from 90 for the same period last year.
Debt increases substantially
Jazz Pharmaceuticals plc has witnessed an increase in total debt over the last one year. It stood at $2,183.47 million as on Sep. 30, 2016, up 69.30 percent or $893.78 million from $1,289.69 million on Sep. 30, 2015. Total debt was 44.28 percent of total assets as on Sep. 30, 2016, compared with 37.23 percent on Sep. 30, 2015. Debt to equity ratio was at 1.27 as on Sep. 30, 2016, up from 0.82 as on Sep. 30, 2015. Interest coverage ratio deteriorated to 7.37 for the quarter from 10.40 for the same period last year.
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