Morningstar Inc (MORN) has reported a 37.28 percent plunge in profit for the quarter ended Mar. 31, 2017. The company has earned $18 million, or $0.42 a share in the quarter, compared with $28.70 million, or $0.67 a share for the same period last year. Revenue during the quarter grew 9.06 percent to $209.50 million from $192.10 million in the previous year period. Gross margin for the quarter contracted 190 basis points over the previous year period to 53.70 percent. Total expenses were 86.44 percent of quarterly revenues, up from 77.98 percent for the same period last year. That has resulted in a contraction of 846 basis points in operating margin to 13.56 percent.
Operating income for the quarter was $28.40 million, compared with $42.30 million in the previous year period.
Kunal Kapoor, Morningstar’s chief executive officer, said, “We saw a number of bright spots in the quarter, but operating income and earnings per share were down year over year. Profitability was impacted by several factors, including continued weak issuance in the structured credit market, investments made to expand our workforce and acquire PitchBook in 2016, and higher bonus and commission expense relative to the same period last year.
Operating cash flow improves significantly
Morningstar Inc has generated cash of $46.50 million from operating activities during the quarter, up 307.89 percent or $35.10 million, when compared with the last year period. The company has spent $17.50 million cash to meet investing activities during the quarter as against cash outgo of $28.10 million in the last year period.
The company has spent $26 million cash to carry out financing activities during the quarter as against cash outgo of $7.90 million in the last year period.
Cash and cash equivalents stood at $265.80 million as on Mar. 31, 2017, up 43.52 percent or $80.60 million from $185.20 million on Mar. 31, 2016.
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