SP Plus Corp (SP) swung to a net profit for the quarter ended Mar. 31, 2017. The company has made a net profit of $6 million in the quarter, against a net loss of $359.20 million in the last year period. On the other hand, adjusted net income for the quarter stood at $6.20 million, or $0.28 a share compared with $2.20 million or $0.10 a share, a year ago.
Revenue during the quarter grew 4.25 percent to $414.50 million from $397.60 million in the previous year period. Gross margin for the quarter expanded 11 basis points over the previous year period to 9.77 percent. Total expenses were 96.94 percent of quarterly revenues, down from 98.84 percent for the same period last year. This has led to an improvement of 191 basis points in operating margin to 3.06 percent.
Operating income for the quarter was $12.70 million, compared with $4.60 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $18.80 million compared with $15 million in the prior year period. At the same time, adjusted EBITDA margin improved 76 basis points in the quarter to 4.54 percent from 3.77 percent in the last year period.
G Marc Baumann, president and chief executive officer, stated, "We're very pleased to have started the year on a good note. Overall financial performance was largely in line with our expectations, as we saw relatively strong gross profit growth coupled with continued reductions in G&A, which led to significant year-over-year growth in bottom-line results. We experienced solid performance across most vertical and geographic markets in our Commercial Division, with the exception of the New York Metro market where we are working to address certain market challenges. In addition, the Airport Division generated strong results. Our first quarter gross profit growth also benefitted from lower than expected health care claim costs."
Operating cash flow improves marginally
SP Plus Corp has generated cash of $5 million from operating activities during the quarter, up 4.17 percent or $0.20 million, when compared with the last year period.
Cash flow from investing activities was almost stable for the quarter at $1.40 million, when compared with the previous year period.
The company has spent $4.20 million cash to carry out financing activities during the quarter as against cash inflow of $7.20 million in the last year period.
Cash and cash equivalents stood at $21.60 million as on Mar. 31, 2017, down 29.87 percent or $9.20 million from $30.80 million on Mar. 31, 2016.
Working capital remains negative
Working capital of SP Plus Corp was negative $65.20 million on Mar. 31, 2017 compared with negative $41.50 million on Mar. 31, 2016. Current ratio was at 0.71 as on Mar. 31, 2017, down from 0.81 on Mar. 31, 2016.
Days sales outstanding were almost stable at 25 days for the quarter, when compared with the last year period.
At the same time, days payable outstanding was almost stable at 25 days for the quarter, when compared with the previous year period.
Debt comes down
SP Plus Corp has recorded a decline in total debt over the last one year. It stood at $191.80 million as on Mar. 31, 2017, down 18.14 percent or $42.50 million from $234.30 million on Mar. 31, 2016. Total debt was 24.78 percent of total assets as on Mar. 31, 2017, compared with 29.42 percent on Mar. 31, 2016. Debt to equity ratio was at 0.70 as on Mar. 31, 2017, down from 0.94 as on Mar. 31, 2016. Interest coverage ratio deteriorated to 4.88 for the quarter from 1.64 for the same period last year.
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