Luvu Brands, Inc. (LUVU) has reported a 78.12 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $0.40 million in the quarter, compared with $0.22 million for the same period last year.
Revenue during the quarter grew 5.03 percent to $5.13 million from $4.89 million in the previous year period. Gross margin for the quarter expanded 291 basis points over the previous year period to 30.02 percent. Total expenses were 89.85 percent of quarterly revenues, down from 93.04 percent for the same period last year. This has led to an improvement of 319 basis points in operating margin to 10.15 percent.
Operating income for the quarter was $0.52 million, compared with $0.34 million in the previous year period.
Louis Friedman, Chairman and Chief Executive Officer, commented, "We are pleased with the growth in net sales and gross profit during the three and six months ended December, 31, 2016. The production improvements that we made during calendar year 2016 are yielding positive results and the roll pack machine that was delivered in January of this year should allow us to continue that trend."
Working capital remains negative
Working capital of Luvu Brands, Inc. was negative $2.04 million on Dec. 31, 2016 compared with negative $1.46 million on Dec. 31, 2015. Current ratio was at 0.62 as on Dec. 31, 2016, down from 0.68 on Dec. 31, 2015.
Cash conversion cycle (CCC) has decreased to 6 days for the quarter from 8 days for the last year period. Days sales outstanding went up to 18 days for the quarter compared with 17 days for the same period last year.
Days inventory outstanding has increased to 40 days for the quarter compared with 37 days for the previous year period. At the same time, days payable outstanding went up to 64 days for the quarter from 61 for the same period last year.
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