Patterson Companies, Inc. (PDCO) has reported a 5.99 percent fall in profit for the quarter ended Apr. 29, 2017. The company has earned $61.69 million, or $0.65 a share in the quarter, compared with $65.62 million, or $0.68 a share for the same period last year. On the other hand, adjusted net income from continuing operations for the quarter stood at $65.61 million, or $0.69 a share compared with $74.10 million or $0.77 a share, a year ago.
Revenue during the quarter went down marginally by 0.60 percent to $1,445.03 million from $1,453.77 million in the previous year period. Gross margin for the quarter contracted 180 basis points over the previous year period to 23.22 percent. Total expenses were 93.35 percent of quarterly revenues, up from 92.68 percent for the same period last year. That has resulted in a contraction of 66 basis points in operating margin to 6.65 percent.
Operating income for the quarter was $96.16 million, compared with $106.34 million in the previous year period.
However, the adjusted operating income from continuing operations for the quarter stood at $106.34 million compared to $119.64 million in the prior year period. At the same time, adjusted operating margin contracted 87 basis points in the quarter to 7.36 percent from 8.23 percent in the last year period.
"Patterson Companies continues to move through a period of strategic investment and change, responding to the evolving needs of our customers and implementing an enterprise resource planning system to modernize our technology infrastructure for future capabilities. While we have made tremendous progress on these initiatives, our fiscal 2017 financial performance does not reflect the strength of the platform we are building," said Scott Anderson, chairman, president and chief executive officer of Patterson Companies. "During fiscal 2018, we will be implementing a range of necessary actions to improve our execution and margin profile. In addition to our enterprise-wide efficiency programs, these actions will include sales and marketing investments in our Dental segment and continued synergy capture in our Animal Health segment."
For financial year 2018, Patterson Companies, Inc. projects diluted earnings per share to be in the range of $1.90 to $2.05. The company projects diluted earnings per share to be in the range of $2.25 to $2.40 on adjusted basis.
Operating cash flow improves marginally
Patterson Companies, Inc. has generated cash of $162.72 million from operating activities during the year, up 4.09 percent or $6.39 million, when compared with the last year.
Cash flow from investing activities was $1.19 million from investing activities during the year as against cash outgo of $400.63 million in the last year.
The company has spent $202.16 million cash to carry out financing activities during the year as against cash inflow of $42.87 million in the last year period.
Cash and cash equivalents stood at $94.96 million as on Apr. 29, 2017, down 30.92 percent or $42.49 million from $137.45 million on Apr. 30, 2016.
Debt moves up marginally
Patterson Companies, Inc. has witnessed an increase in total debt over the last one year. It stood at $1,072.03 million as on Apr. 29, 2017, up 1.26 percent or $13.37 million from $1,058.66 million on Apr. 30, 2016. Interest coverage ratio deteriorated to 8.43 for the quarter from 10.49 for the same period last year.
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