Manitowoc Foodservice, Inc. (MFS) has reported a 39.42 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $24.90 million, or $0.18 a share in the quarter, compared with $41.10 million, or $0.30 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $27.40 million, or $0.20 a share compared with $42.20 million or $0.31 a share, a year ago.
Revenue during the quarter dropped 9.71 percent to $384 million from $425.30 million in the previous year period. Gross margin for the quarter expanded 517 basis points over the previous year period to 36.98 percent. Total expenses were 84.22 percent of quarterly revenues, down from 87.33 percent for the same period last year. This has led to an improvement of 311 basis points in operating margin to 15.78 percent.
Operating income for the quarter was $60.60 million, compared with $53.90 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $72.10 million compared with $63.60 million in the prior year period. At the same time, adjusted EBITDA margin improved 382 basis points in the quarter to 18.78 percent from 14.95 percent in the last year period.
"We delivered our fifth consecutive quarter of strong year-over-year Adjusted EBITA margin improvement through continued great execution of our Simplification and Right-Sizing initiatives," said Hubertus Muehlhaeuser, Manitowoc Foodservice's president and chief executive officer. "Within Simplification, we pruned approximately 1 percent of our equipment SKUs during the quarter, bringing our total equipment SKU reduction to nearly 9 percent since we adopted the 80/20 methodology. While we have previously completed all of the Right-Sizing actions that we originally announced a year ago, the benefits from those actions are still driving year-over-year margin favorability. In addition, we made good progress this quarter on the second round of Right-Sizing that we announced last quarter. We also continued the journey of de-levering our balance sheet this quarter with a $26.7 million net debt reduction in the quarter."
For fiscal year 2016, Manitowoc Foodservice, Inc. expects diluted earnings per share to be in the range of $0.60 to $0.70 on adjusted basis.
Operating cash flow declines
Manitowoc Foodservice, Inc. has generated cash of $51.80 million from operating activities during the nine month period, down 24.71 percent or $17 million, when compared with the last year period.
The company has spent $13.70 million cash to meet investing activities during the nine month period as against cash outgo of $10.10 million in the last year period.
The company has spent $0.10 million cash to carry out financing activities during the nine month period as against cash outgo of $26 million in the last year period.
Cash and cash equivalents stood at stood at $69.60 million as at Sep. 30, 2016.
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