Motorcar Parts of America, Inc. (MPAA) has reported a 43.39 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $11.11 million, or $0.57 a share in the quarter, compared with $7.75 million, or $0.41 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $11.74 million, or $0.60 a share compared with $9.94 million or $0.52 a share, a year ago.
Revenue during the quarter grew 19.75 percent to $112.60 million from $94.02 million in the previous year period. Gross margin for the quarter contracted 199 basis points over the previous year period to 28.75 percent. Total expenses were 82.11 percent of quarterly revenues, down from 82.22 percent for the same period last year. This has led to an improvement of 11 basis points in operating margin to 17.89 percent.
Operating income for the quarter was $20.14 million, compared with $16.72 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $23.56 million compared with $19.60 million in the prior year period. At the same time, adjusted EBITDA margin improved 8 basis points in the quarter to 20.92 percent from 20.84 percent in the last year period.
"As we approach the end of fiscal 2017, we are well-positioned within a $116 billion aftermarket hard parts industry. We anticipate continued growth in all of our product lines, and we are encouraged by the additional opportunities we are seeing. Our adjusted double digit sales growth over the last five years highlights the company's success and we remain optimistic about the future," said Selwyn Joffe, chairman, president and chief executive officer of Motorcar Parts of America.
Working capital turns positive
Working capital of Motorcar Parts of America, Inc. has turned positive to $3.94 million on Dec. 31, 2016 from negative $1.16 million on Dec. 31, 2015. Current ratio was at 1.03 as on Dec. 31, 2016, up from 0.99 on Dec. 31, 2015.
Cash conversion cycle (CCC) has increased to 31 days for the quarter from 3 days for the last year period. Days sales outstanding went up to 10 days for the quarter compared with 1 days for the same period last year.
Days inventory outstanding has decreased to 44 days for the quarter compared with 94 days for the previous year period. At the same time, days payable outstanding went down to 84 days for the quarter from 93 for the same period last year.
Debt increases substantially
Motorcar Parts of America, Inc. has witnessed an increase in total debt over the last one year. It stood at $38.76 million as on Dec. 31, 2016, up 25.81 percent or $7.95 million from $30.80 million on Dec. 31, 2015. Total debt was 8.75 percent of total assets as on Dec. 31, 2016, compared with 8.04 percent on Dec. 31, 2015. Debt to equity ratio was almost stable at 0.16 as on Dec. 31, 2016, when compared with the last year. Interest coverage ratio deteriorated to 6 for the quarter from 6.64 for the same period last year.
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