Sapiens International Corporation (SPNS) swung to a net loss for the quarter ended Mar. 31, 2017. The company has made a net loss of $2.21 million, or $ 0.05 a share in the quarter, against a net profit of $4.89 million, or $0.10 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $1.18 million, or $0.02 a share compared with $5.99 million or $0.12 a share, a year ago.
Revenue during the quarter grew 14.06 percent to $56.53 million from $49.57 million in the previous year period. Gross margin for the quarter contracted 640 basis points over the previous year period to 33.87 percent. Operating margin for the quarter stood at negative 2.90 percent as compared to a positive 12.61 percent for the previous year period.
Operating loss for the quarter was $1.64 million, compared with an operating income of $6.25 million in the previous year period.
However, the adjusted operating income for the quarter stood at $1.70 million compared to $7.35 million in the prior year period. At the same time, adjusted operating margin contracted 1182 basis points in the quarter to 3 percent from 14.82 percent in the last year period.
"Sapiens delivered another quarter of double-digit revenue increase, driven by a mix of organic growth and our recent acquisition of StoneRiver," said Roni Al-Dor, president and chief executive officer of Sapiens. Two factors are offseting this growth to some extent in the near term, particularly in terms of operational profitability: the halt of a software development project with a significant customer and the integration of StoneRiver. In the second quarter, we will continue restructuring steps to address these developments and remain on track in the second half of 2017."
For fiscal year 2017, Sapiens International Corporation expects adjusted revenue to be in the range of $265 million to $275 million. It expects adjusted operating income to grow in the range of 9 percent to 10 percent.
Operating cash flow turns negative
Sapiens International Corporation has spent $7.32 million cash to meet operating activities during the quarter as against cash inflow of $4.46 million in the last year period.
The company has spent $60.39 million cash to meet investing activities during the quarter as against cash outgo of $2.14 million in the last year period.
Cash flow from financing activities was $40.10 million for the quarter, up 8,377.17 percent or $39.62 million, when compared with the last year period.
Cash and cash equivalents stood at $35.12 million as on Mar. 31, 2017, down 40.16 percent or $23.56 million from $58.68 million on Mar. 31, 2016.
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