Stamps.Com (STMP) has reported 156.70 percent jump in profit for the quarter ended Sep. 30, 2016. The company has earned $18.67 million, or $1.03 a share in the quarter, compared with $7.27 million, or $0.42 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $4.22 million, or $2.33 a share compared with $2 million or $1.14 a share, a year ago. Revenue during the quarter surged 79.14 percent to $92.56 million from $51.67 million in the previous year period. Gross margin for the quarter expanded 358 basis points over the previous year period to 81.93 percent. Total expenses were 65.87 percent of quarterly revenues, down from 74.86 percent for the same period last year. This has led to an improvement of 899 basis points in operating margin to 34.13 percent.
Operating income for the quarter was $31.59 million, compared with $12.99 million in the previous year period.
However, the adjusted operating income for the quarter stood at $4.44 million compared to $2.04 million in the prior year period. At the same time, adjusted operating margin improved 84 basis points in the quarter to 4.80 percent from 3.95 percent in the last year period.
“We were very pleased with our third quarter performance,” said Ken McBride, Stamps.com's chairman and Chief executive officer. “We completed our acquisition of ShippingEasy and have begun the process of leveraging our collective Company’s resources and expertise in sales and marketing, customer service, product development and technology innovation. In addition, we experienced continued strong performance with our traditional small business, enterprise and high volume shipping customers, as well as with our prior acquisitions of Endicia, ShipStation and ShipWorks. As a result of the across-the-board strength, we also achieved strong performance in several business metrics such as paid customers and average revenue per paid customer. With expected continued strength in our business, we increased our 2016 guidance today.”
Stamps.Com projects revenue to be in the range of $340 million to $360 million for financial year 2016. For financial year 2016, the company forecasts diluted earnings per share to be in the range of $3.25 to $3.70. For financial year 2016, the company forecasts diluted earnings per share to be in the range of $8 to $8.50 on adjusted basis.
Working capital turns negative
Working capital of Stamps.Com has turned negative to $71.84 million on Sep. 30, 2016 from positive $50.27 million on Sep. 30, 2015. Current ratio was at 0.68 as on Sep. 30, 2016, down from 1.68 on Sep. 30, 2015. Days sales outstanding went up to 37 days for the quarter compared with 27 days for the same period last year.
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