R1 RCM Inc (ACHI) has reported 140.98 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $13.13 million, or $0.05 a share in the quarter, compared with $5.45 million, or $0.06 a share for the same period last year. Revenue during the quarter surged 55.33 percent to $106.16 million from $68.34 million in the previous year period. Gross margin for the quarter contracted 186 basis points over the previous year period to 41.52 percent. Total expenses were 74.09 percent of quarterly revenues, down from 84.02 percent for the same period last year. This has led to an improvement of 994 basis points in operating margin to 25.91 percent.
Operating income for the quarter was $27.51 million, compared with $10.92 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $35.89 million compared with $22.67 million in the prior year period. At the same time, adjusted EBITDA margin improved 64 basis points in the quarter to 33.81 percent from 33.17 percent in the last year period.
“R1’s fourth quarter results reflect the continued progress we are making in executing on our objectives and establishing a path towards sustained profitability,” said Joe Flanagan, President and Chief Executive Officer of R1. “2016 overall was a pivotal year for R1 ��" in addition to renewal and expansion of our agreement with Ascension, we renewed our agreement with Intermountain Healthcare, added significant expertise to our senior management team, streamlined our cost structure, and generated substantial improvement in our financial results during the second half of the year. The progress we have made gives us confidence in our outlook for 2017 and we firmly believe it also positions us well for new customer growth.”
R1 RCM INC. projects revenue to be in the range of $400 million to $425 million for financial year 2017. For fiscal year 2017, the company projects operating income to be in the range of $25 million to $30 million.
Operating cash flow remains negative
R1 RCM Inc has spent $86.86 million cash to meet operating activities during the year as against cash outgo of $23.81 million in the last year. The company has spent $11.61 million cash to meet investing activities during the year as against cash outgo of $22.30 million in the last year.
Cash flow from financing activities was $176.40 million for the year, up 3,470.75 percent or $171.46 million, when compared with the last year.
Cash and cash equivalents stood at $181.18 million as on Dec. 31, 2016, up 75.05 percent or $77.68 million from $103.50 million on Dec. 31, 2015.
Working capital turns positive
Working capital of R1 RCM Inc has turned positive to $69.50 million on Dec. 31, 2016 from negative $105.89 million on Dec. 31, 2015. Current ratio was at 1.51 as on Dec. 31, 2016, up from 0.54 on Dec. 31, 2015.
Days sales outstanding went down to 3 days for the quarter compared with 7 days for the same period last year.
At the same time, days payable outstanding was almost stable at 6 days for the quarter, when compared with the previous year period.
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