NetSol Technologies, Inc. (NTWK) swung to a net loss for the quarter ended Dec. 31, 2016. The company has made a net loss of $0.99 million, or $ 0.09 a share in the quarter, against a net profit of $0.88 million, or $0.08 a share in the last year period. On an adjusted basis, earnings per share were at $0.09 for the quarter compared with $0.24 in the same period last year. Revenue during the quarter grew 8.93 percent to $17.64 million from $16.19 million in the previous year period. Gross margin for the quarter contracted 77 basis points over the previous year period to 47.84 percent. Total expenses were 91.91 percent of quarterly revenues, up from 87.12 percent for the same period last year. That has resulted in a contraction of 478 basis points in operating margin to 8.09 percent.
Operating income for the quarter was $1.43 million, compared with $2.08 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $1.02 million compared with $2.57 million in the prior year period. At the same time, adjusted EBITDA margin contracted 1010 basis points in the quarter to 5.76 percent from 15.86 percent in the last year period.
"Our fiscal second quarter results are highlighted by strong year-over-year growth in our license and maintenance revenues driven by new client implementations and cross-sales into our existing customer base" said Najeeb Ghauri, chief executive officer of NETSOL. "Demand remains solid across our solutions and geographies, our pipeline is growing, and our large twelve-country NFS Ascent implementation remains on track."
NetSol Technologies, Inc. expects revenue to be in the range of $73 million to $75 million for financial year 2017.
Operating cash flow drops significantlyNetSol Technologies, Inc. has generated cash of $0.07 million from operating activities during the first half, down 96.58 percent or $1.96 million, when compared with the last year period. The company has spent $1.64 million cash to meet investing activities during the first six months as against cash outgo of $1.17 million in the last year period. It has incurred net capital expenditure of $0.89 million on net basis during the first six months, up 9 percent or $0.07 million from year ago period.
The company has spent $0.59 million cash to carry out financing activities during the first six months as against cash inflow of $0.04 million in the last year period.
Cash and cash equivalents stood at $9.51 million as on Dec. 31, 2016, down 32.04 percent or $4.48 million from $13.99 million on Dec. 31, 2015.
Working capital increases sharply
NetSol Technologies, Inc. has recorded an increase in the working capital over the last year. It stood at $26.03 million as at Dec. 31, 2016, up 28.39 percent or $5.76 million from $20.28 million on Dec. 31, 2015. Current ratio was at 2.78 as on Dec. 31, 2016, up from 2.52 on Dec. 31, 2015.
Days sales outstanding went down to 59 days for the quarter compared with 67 days for the same period last year.
Debt moves up
NetSol Technologies, Inc. has witnessed an increase in total debt over the last one year. It stood at $4.87 million as on Dec. 31, 2016, up 20.55 percent or $0.83 million from $4.04 million on Dec. 31, 2015. Total debt was 5.26 percent of total assets as on Dec. 31, 2016, compared with 4.63 percent on Dec. 31, 2015. Debt to equity ratio was almost stable at 0.06 as on Dec. 31, 2016, when compared with the last year. Interest coverage ratio deteriorated to 22.98 for the quarter from 28.89 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
