Teleflex Incorporated (TFX) has reported a 39.62 percent plunge in profit for the quarter ended Dec. 31, 2016. The company has earned $61.06 million, or $1.30 a share in the quarter, compared with $101.12 million, or $2.09 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $97.50 million, or $2.13 a share compared with $90.20 million or $2.01 a share, a year ago.
Revenue during the quarter grew 6.07 percent to $513.93 million from $484.50 million in the previous year period. Gross margin for the quarter contracted 60 basis points over the previous year period to 53.13 percent. Total expenses were 86.96 percent of quarterly revenues, up from 80.03 percent for the same period last year. That has resulted in a contraction of 693 basis points in operating margin to 13.04 percent.
Operating income for the quarter was $67.03 million, compared with $96.75 million in the previous year period.
"Teleflex delivered a strong finish to 2016 with revenue growth above our most recently provided guidance," said Benson Smith, chairman and chief executive officer. "During the fourth quarter, each of our segments delivered solid performances, resulting in constant currency revenue growth of 6.9% and the attainment of an adjusted operating margin of 25.0%."
For financial year 2017, Teleflex Incorporated projects revenue to grow in the range of 12.50 percent to 14 percent. The company forecasts diluted earnings per share to be in the range of $5.04 to $5.08. The company forecasts diluted earnings per share to be in the range of $8 to $8.15 on adjusted basis.
Operating cash flow improves significantly
Teleflex Incorporated has generated cash of $408.48 million from operating activities during the year, up 35.79 percent or $107.67 million, when compared with the last year.
The company has spent $56.97 million cash to meet investing activities during the year as against cash outgo of $154.85 million in the last year. It has incurred net capital expenditure of $42.93 million on net basis during the year, down 29.66 percent or $18.11 million from year ago.
The company has spent $118.69 million cash to carry out financing activities during the year as against cash outgo of $85.58 million in the last year period.
Cash and cash equivalents stood at $543.79 million as on Dec. 31, 2016, up 60.71 percent or $205.42 million from $338.37 million on Dec. 31, 2015.
Working capital increases sharply
Teleflex Incorporated has recorded an increase in the working capital over the last year. It stood at $755.75 million as at Dec. 31, 2016, up 122.46 percent or $416.03 million from $339.72 million on Dec. 31, 2015. Current ratio was at 2.77 as on Dec. 31, 2016, up from 1.51 on Dec. 31, 2015.
Cash conversion cycle (CCC) has decreased to 75 days for the quarter from 83 days for the last year period. Days sales outstanding were almost stable at 26 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 64 days for the quarter compared with 71 days for the previous year period. At the same time, days payable outstanding was almost stable at 14 days for the quarter, when compared with the previous year period.
Debt comes down marginally
Teleflex Incorporated has recorded a decline in total debt over the last one year. It stood at $1,033.32 million as on Dec. 31, 2016, down 2.44 percent or $25.88 million from $1,059.20 million on Dec. 31, 2015. Total debt was 26.56 percent of total assets as on Dec. 31, 2016, compared with 27.31 percent on Dec. 31, 2015. Debt to equity ratio was at 0.48 as on Dec. 31, 2016, down from 0.53 as on Dec. 31, 2015. Interest coverage ratio deteriorated to 4.10 for the quarter from 7.09 for the same period last year.
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