Sprint Corporation (S) saw its loss narrow to $283 million, or $0.07 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $554 million, or $0.14 a share.
Revenue during the quarter grew 5.80 percent to $8,539 million from $8,071 million in the previous year period. Gross margin for the quarter expanded 351 basis points over the previous year period to 56.48 percent. Total expenses were 94.50 percent of quarterly revenues, down from 99.90 percent for the same period last year. This has led to an improvement of 541 basis points in operating margin to 5.50 percent.
Operating income for the quarter was $470 million, compared with $8 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $2,680 million compared with $2,158 million in the prior year period. At the same time, adjusted EBITDA margin improved 465 basis points in the quarter to 31.39 percent from 26.74 percent in the last year period.
"Sprint took a big step forward in the second year of our turnaround plan," said Sprint chief executive officer Marcelo Claure. "Net operating revenues returned to growth and cost reductions accelerated, leading to the highest operating income in a decade and a return to positive adjusted free cash flow."
For fiscal year 2017, Sprint Corporation expects operating income to be in the range of $2,000 million to $2,500 million.
Operating cash flow improves
Sprint Corporation has generated cash of $4,168 million from operating activities during the year, up 6.95 percent or $271 million, when compared with the last year.
The company has spent $9,225 million cash to meet investing activities during the year as against cash outgo of $5,735 million in the last year. It has incurred net capital expenditure of $3,739 million on net basis during the year, down 46.65 percent or $3,269 million from year ago.
Cash flow from financing activities was $5,286 million for the year, up 1,027.08 percent or $4,817 million, when compared with the last year.
Cash and cash equivalents stood at $2,870 million as on Mar. 31, 2017, up 8.67 percent or $229 million from $2,641 million on Mar. 31, 2016.
Working capital turns positive
Working capital of Sprint Corporation has turned positive to $1,659 million on Mar. 31, 2017 from negative $5,130 million on Mar. 31, 2016. Current ratio was at 1.13 as on Mar. 31, 2017, up from 0.57 on Mar. 31, 2016.
Cash conversion cycle (CCC) has decreased to 5 days for the quarter from 14 days for the last year period. Days sales outstanding went up to 22 days for the quarter compared with 6 days for the same period last year.
Days inventory outstanding has decreased to 13 days for the quarter compared with 14 days for the previous year period. At the same time, days payable outstanding went up to 40 days for the quarter from 35 for the same period last year.
Debt moves up
Sprint Corporation has witnessed an increase in total debt over the last one year. It stood at $40,914 million as on Mar. 31, 2017, up 20.48 percent or $6,956 million from $33,958 million on Mar. 31, 2016. Total debt was 48.06 percent of total assets as on Mar. 31, 2017, compared with 43 percent on Mar. 31, 2016. Debt to equity ratio was at 2.18 as on Mar. 31, 2017, up from 1.72 as on Mar. 31, 2016. Interest coverage ratio improved to 0.74 for the quarter from 0.01 for the same period last year.
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