MagicJack VocalTec Ltd. (CALL) has reported a 2.66 percent rise in profit for the quarter ended Sep. 30, 2016. The company has earned $3.40 million, or $0.21 a share in the quarter, compared with $3.31 million, or $0.20 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $4.61 million, or $0.29 a share compared with $6.11 million or $0.37 a share, a year ago.
Revenue during the quarter dropped 3.29 percent to $24.57 million from $25.41 million in the previous year period. Gross margin for the quarter contracted 633 basis points over the previous year period to 61.30 percent. Total expenses were 77.91 percent of quarterly revenues, up from 70.67 percent for the same period last year. That has resulted in a contraction of 724 basis points in operating margin to 22.09 percent.
Operating income for the quarter was $5.43 million, compared with $7.45 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $7.03 million compared with $9.73 million in the prior year period. At the same time, adjusted EBITDA margin contracted 971 basis points in the quarter to 28.59 percent from 38.31 percent in the last year period.
"We were pleased with our execution in the third quarter," said Gerald Vento, president and chief executive officer of magicJack VocalTec. "The results were driven by our consumer business highlighted by low churn, stabilization in activations and ongoing traction with our organic growth initiatives."
Operating cash flow drops significantly
MagicJack VocalTec Ltd. has generated cash of $13.28 million from operating activities during the nine month period, down 31.28 percent or $6.05 million, when compared with the last year period.
The company has spent $40.36 million cash to meet investing activities during the nine month period as against cash outgo of $0.55 million in the last year period.
Cash flow from financing activities was $0.01 million for the nine month period as against cash outgo of $15.16 million in the last year period.
Cash and cash equivalents stood at $51.53 million as on Sep. 30, 2016, down 35.24 percent or $28.04 million from $79.57 million on Sep. 30, 2015.
Working capital drops significantly
MagicJack VocalTec Ltd. has witnessed a decline in the working capital over the last year. It stood at $5.40 million as at Sep. 30, 2016, down 86.29 percent or $33.96 million from $39.35 million on Sep. 30, 2015. Current ratio was at 1.09 as on Sep. 30, 2016, down from 1.63 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 11 days for the quarter from 67 days for the last year period. Days sales outstanding were almost stable at 9 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 22 days for the quarter compared with 73 days for the previous year period. At the same time, days payable outstanding went up to 20 days for the quarter from 15 for the same period last year.
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