Kindred Healthcare Inc (KND) saw its loss widen to $685.61 million, or $7.89 a share for the quarter ended Sep. 30, 2016. In the previous year period, the company reported a loss of $14.60 million, or $0.17 a share.
Revenue during the quarter went up marginally by 1.64 percent to $1,793.53 million from $1,764.52 million in the previous year period. Gross margin for the quarter expanded 15 basis points over the previous year period to 94.68 percent. Operating margin for the quarter stood at negative 18.48 percent as compared to a positive 3.49 percent for the previous year period.
Operating loss for the quarter was $331.49 million, compared with an operating income of $61.56 million in the previous year period.
Benjamin A. Breier, president and chief executive officer of the Company, commented, “We are taking proactive strategic steps to position Kindred for long-term success against the backdrop of dynamic changes in the healthcare services industry. Our plan to exit the skilled nursing facility business, together with the significant cost realignment initiative we are undertaking in connection with the exit, are substantial steps forward in our continuing effort to transform Kindred’s strategy and growth profile to enhance shareholder value.”
Kindred Healthcare forecasts revenue to be $7,200 million for fiscal year 2016. For financial year 2016, the company projects diluted earnings per share to be in the range of $0.70 to $0.80 on adjusted basis.
Operating cash flow drops significantly
Kindred Healthcare Inc has generated cash of $38.05 million from operating activities during the nine month period, down 59.12 percent or $55.02 million, when compared with the last year period.
The company has spent $172.49 million cash to meet investing activities during the nine month period as against cash inflow of $828.15 million in the last year period
Cash flow from financing activities was $175.12 million for the nine month period as against cash outgo of $964.51 million in the last year period.
Cash and cash equivalents stood at $139.43 million as on Sep. 30, 2016, up 15.34 percent or $18.54 million from $120.89 million on Sep. 30, 2015.
Working capital increases sharply
Kindred Healthcare Inc has recorded an increase in the working capital over the last year. It stood at $622.53 million as at Sep. 30, 2016, up 25.85 percent or $127.87 million from $494.66 million on Sep. 30, 2015. Current ratio was at 1.61 as on Sep. 30, 2016, up from 1.44 on Sep. 30, 2015.
Cash conversion cycle (CCC) has increased to 109 days for the quarter from 83 days for the last year period. Days sales outstanding were almost stable at 65 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 12 days for the quarter compared with 26 days for the previous year period. At the same time, days payable outstanding went up to 187 days for the quarter from 174 for the same period last year.
Debt moves up
Kindred Healthcare has witnessed an increase in total debt over the last one year. It stood at $3,344.06 million as on Sep. 30, 2016, up 5.86 percent or $185.18 million from $3,158.89 million on Sep. 30, 2015. Total debt was 53.70 percent of total assets as on Sep. 30, 2016, compared with 48.57 percent on Sep. 30, 2015. Debt to equity ratio was at 3.18 as on Sep. 30, 2016, up from 1.91 as on Sep. 30, 2015.
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