KEMET Corporation (KEM) swung to a net profit for the quarter ended Dec. 31, 2016. The company has made a net profit of $12.28 million, or $ 0.22 a share in the quarter, against a net loss of $8.60 million, or $0.19 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $5.81 million, or $0.11 a share compared with $2.17 million or $0.04 a share, a year ago. Revenue during the quarter grew 6.12 percent to $188.03 million from $177.18 million in the previous year period. Gross margin for the quarter expanded 331 basis points over the previous year period to 25.18 percent. Total expenses were 92.63 percent of quarterly revenues, down from 95.21 percent for the same period last year. This has led to an improvement of 257 basis points in operating margin to 7.37 percent.
Operating income for the quarter was $13.85 million, compared with $8.49 million in the previous year period.
However, the adjusted operating income for the quarter stood at $16.98 million compared to $13.57 million in the prior year period. At the same time, adjusted operating margin improved 137 basis points in the quarter to 9.03 percent from 7.66 percent in the last year period.
“This quarter is the fourth quarter of sequential growth and the highest revenue since our first quarter in fiscal 2016,” stated Per Loof KEMET’s chief executive officer. “Global initiatives in the sales development process that targeted specific segments and product technologies supported this growth. These initiatives, coupled with a defined strategy and a target market that was shared across Sales, Business Groups and Technical Marketing boosted the overall quarter performance,” continued Loof.
Operating cash flow turns positive
KEMET Corporation has generated cash of $42.14 million from operating activities during the nine month period as against cash outgo of $0.56 million in the last year period. The company has spent $15.01 million cash to meet investing activities during the nine month period as against cash outgo of $16.11 million in the last year period.
The company has spent $3.41 million cash to carry out financing activities during the nine month period as against cash inflow of $3.33 million in the last year period.
Cash and cash equivalents stood at $87.36 million as on Dec. 31, 2016, up 102.41 percent or $44.20 million from $43.16 million on Dec. 31, 2015.
Working capital increases marginally
KEMET Corporation has recorded an increase in the working capital over the last year. It stood at $238.60 million as at Dec. 31, 2016, up 1.85 percent or $4.34 million from $234.26 million on Dec. 31, 2015. Current ratio was at 3.17 as on Dec. 31, 2016, up from 3.05 on Dec. 31, 2015.
Cash conversion cycle (CCC) has decreased to 50 days for the quarter from 122 days for the last year period. Days sales outstanding went down to 43 days for the quarter compared with 47 days for the same period last year.
Days inventory outstanding has decreased to 51 days for the quarter compared with 119 days for the previous year period. At the same time, days payable outstanding went down to 43 days for the quarter from 44 for the same period last year.
Debt comes down marginally
KEMET Corporation has recorded a decline in total debt over the last one year. It stood at $386.23 million as on Dec. 31, 2016, down 2.19 percent or $8.66 million from $394.89 million on Dec. 31, 2015. Total debt was 58.30 percent of total assets as on Dec. 31, 2016, compared with 55.86 percent on Dec. 31, 2015. Debt to equity ratio was at 4.27 as on Dec. 31, 2016, up from 3.17 as on Dec. 31, 2015. Interest coverage ratio improved to 1.40 for the quarter from 0.86 for the same period last year.
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