RTI Surgical Inc (RTIX) swung to a net loss for the quarter ended Dec. 31, 2016. The company has made a net loss of $11.10 million, or $ 0.21 a share in the quarter, against a net profit of $4.17 million, or $0.06 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $0.52 million, or $0.01 a share compared with $5.06 million or $0.09 a share, a year ago. Revenue during the quarter dropped 6.27 percent to $71.35 million from $76.12 million in the previous year period. Gross margin for the quarter contracted 1356 basis points over the previous year period to 39.39 percent. Operating margin for the quarter stood at negative 19.39 percent as compared to a positive 8.89 percent for the previous year period.
Operating loss for the quarter was $13.83 million, compared with an operating income of $6.77 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $6.09 million compared with $14.08 million in the prior year period. At the same time, adjusted EBITDA margin contracted 996 basis points in the quarter to 8.54 percent from 18.50 percent in the last year period.
RTI Interim chief executive officer Robert Jordheim said, "We are focused on execution and, in parallel with the pending arrival of Camille, we are executing an initial restructuring plan to reduce operating costs and streamline and improve our platform for growth. As a result of this initial cost rationalization, we expect to incur a pre-tax charge of approximately $4 million for severance-related expenses, a majority of which will be recorded in the first quarter of 2017. This initial plan is expected to save the company approximately $8 million of annualized expenses beginning in the first quarter of 2017 and is a first step toward optimizing our expense structure to establish an efficient and more flexible platform upon which to grow profitably."
For financial year 2017, RTI Surgical Inc projects revenue to be in the range of $274 million to $285 million. The company forecasts diluted earnings per share to be in the range of $0.01 to $0.06 and forecasts diluted earnings per share to be in the range of $0.05 to $0.10 on adjusted basis.
Operating cash flow improves significantly
RTI Surgical Inc has generated cash of $15.32 million from operating activities during the year, up 70.33 percent or $6.33 million, when compared with the last year. The company has spent $17.95 million cash to meet investing activities during the year as against cash outgo of $18.24 million in the last year.
Cash flow from financing activities was $3.66 million for the year, down 41.60 percent or $2.61 million, when compared with the last year.
Cash and cash equivalents stood at $13.85 million as on Dec. 31, 2016, up 9.79 percent or $1.23 million from $12.61 million on Dec. 31, 2015.
Debt moves up marginally
RTI Surgical Inc has witnessed an increase in total debt over the last one year. It stood at $6.08 million as on Dec. 31, 2016, up 3.88 percent or $0.23 million from $5.85 million on Dec. 31, 2015. Total debt was 1.65 percent of total assets as on Dec. 31, 2016, compared with 1.54 percent on Dec. 31, 2015. Debt to equity ratio was almost stable at 0.04 as on Dec. 31, 2016, when compared with the last year.
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