Patterson Companies Inc (PDCO) has reported a 29.18 percent rise in profit for the quarter ended Oct. 29, 2016. The company has earned $45.76 million, or $0.48 a share in the quarter, compared with $35.42 million, or $0.36 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $53.52 million, or $0.56 a share compared with $55.28 million or $0.56 a share, a year ago.
Revenue during the quarter went up marginally by 2.09 percent to $1,418.24 million from $1,389.21 million in the previous year period. Gross margin for the quarter contracted 133 basis points over the previous year period to 22.49 percent. Total expenses were 94.37 percent of quarterly revenues, up from 93.99 percent for the same period last year. That has resulted in a contraction of 38 basis points in operating margin to 5.63 percent.
Operating income for the quarter was $79.80 million, compared with $83.46 million in the previous year period.
However, the adjusted operating income for the quarter stood at $91.75 million compared to $97.23 million in the prior year period. At the same time, adjusted operating margin contracted 53 basis points in the quarter to 6.47 percent from 7 percent in the last year period.
“Patterson Companies competes in two markets with attractive long-term fundamentals. The Dental business is positioned to benefit from favorable demographic trends, including an aging population. In Animal Health, the worldwide demand for protein will intensify; and consumers are increasing both their pet ownership and the dollars they spend on their pets. These are compelling trends. However, our markets are evolving, and we are adapting our strategies to take full advantage of new opportunities to deliver even greater value to our customers,” said Scott Anderson, chairman, president and chief executive officer.
For financial year 2017, the company projects diluted earnings per share to be in the range of $1.65 to $1.75. For financial year 2017, the company projects diluted earnings per share to be in the range of $2.25 to $2.35 on adjusted basis.
Operating cash flow remains negative
Patterson Companies Inc has spent $55.31 million cash to meet operating activities during the first half as against cash outgo of $52.95 million in the last year period.
The company has spent $6.26 million cash to meet investing activities during the first six months as against cash outgo of $382.03 million in the last year period.
Cash flow from financing activities was $38.07 million for the first six months, down 80.09 percent or $153.17 million, when compared with the last year period.
Working capital increases marginally
Patterson Companies Inc has recorded an increase in the working capital over the last year. It stood at $886.16 million as at Oct. 29, 2016, up 2.14 percent or $18.59 million from $867.57 million on Oct. 31, 2015. Current ratio was at 1.94 as on Oct. 29, 2016, down from 2.09 on Oct. 31, 2015.
Days sales outstanding went up to 46 days for the quarter compared with 45 days for the same period last year.
Debt moves up
Patterson Companies Inc has witnessed an increase in total debt over the last one year. It stood at $1,193.84 million as on Oct. 29, 2016, up 5.57 percent or $62.96 million from $1,130.88 million on Oct. 31, 2015. Total debt was 33.25 percent of total assets as on Oct. 29, 2016, compared with 32.76 percent on Oct. 31, 2015. Debt to equity ratio was at 0.85 as on Oct. 29, 2016, up from 0.83 as on Oct. 31, 2015.
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