StarTek Inc (SRT) swung to a net profit for the quarter ended Sep. 30, 2016. The company has made a net profit of $0.86 million, or $ 0.05 a share in the quarter, against a net loss of $7.70 million, or $0.49 a share in the last year period.
Revenue during the quarter grew 7.63 percent to $78.30 million from $72.76 million in the previous year period. Gross margin for the quarter expanded 887 basis points over the previous year period to 13.21 percent. Operating margin for the quarter period stood at positive 1.78 percent as compared to a negative 9.71 percent for the previous year period.
Operating income for the quarter was $1.39 million, compared with an operating loss of $7.06 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $5.04 million compared to negative $2.25 million in the prior year second quarter. At the same time, adjusted EBITDA margin stood at 6.44 percent for the quarter compared to negative 3.09 percent in the last year period.
"The third quarter was highlighted by achieving positive net income, accomplished by continued execution of our strategic growth initiatives," said Chad Carlson, chief executive officer of STARTEK. "Building on our momentum over the last several quarters, we continued to focus on delivering added value for clients, winning new business and optimizing contracts to expand margins. During the quarter we won $31.8 million of new business across several industry verticals, while generating a considerable increase in revenue, gross margin and net income, all of which contributed to our third consecutive quarter of free cash flow."
Operating cash flow turns positive
StarTek Inc has generated cash of $11.50 million from operating activities during the nine month period as against cash outgo of $3.37 million in the last year period.
The company has spent $1.53 million cash to meet investing activities during the nine month period as against cash outgo of $24.43 million in the last year period. It has incurred net capital expenditure of $0.91 million on net basis during the nine month period, down 83.44 percent or $4.60 million from year ago period.
The company has spent $12.02 million cash to carry out financing activities during the nine month period as against cash inflow of $22.96 million in the last year period.
Cash and cash equivalents stood at $0.79 million as on Sep. 30, 2016, down 2.83 percent or $0.02 million from $0.81 million on Sep. 30, 2015.
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