TeleTech Holdings, Inc. (TTEC) swung to a net loss for the quarter ended Dec. 31, 2016. The company has made a net loss of $0.61 million, or $ 0.01 a share in the quarter, against a net profit of $17 million, or $0.35 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $19.47 million, or $0.42 a share compared with $23.15 million or $0.47 a share, a year ago.
Revenue during the quarter went up marginally by 0.92 percent to $344.95 million from $341.82 million in the previous year period. Gross margin for the quarter contracted 59 basis points over the previous year period to 27.54 percent. Total expenses were 98.19 percent of quarterly revenues, up from 92.66 percent for the same period last year. That has resulted in a contraction of 553 basis points in operating margin to 1.81 percent.
Operating income for the quarter was $6.24 million, compared with $25.08 million in the previous year period.
However, the adjusted operating income for the quarter stood at $33.20 million compared to $30.29 million in the prior year period. At the same time, adjusted operating margin improved 76 basis points in the quarter to 9.62 percent from 8.86 percent in the last year period.
"2016 was an eventful year for us. Faced with sales execution challenges in the first half of 2016, we quickly implemented a set of strategic initiatives to optimize our sales performance and accelerate our profitability and cash flow," commented Ken Tuchman, chairman and chief executive officer of TeleTech. "The completion of these strategic initiatives required certain restructure and impairment charges which are one time in nature and primarily non-cash charges. We are already realizing the benefit of these actions in our new business signings, growing revenue backlog, and operating income margin improvement. Our go-to-market optimization and streamlined cost structure together with 2016's 42 new client relationships, addition of several new channel partners, and expanded footprint via the acquisition of Canadian-based Atelka positions us in 2017 to continue to deliver meaningful improvement in our top line growth, operating profit, and cash flow."
For fiscal year 2017, TeleTech Holdings, Inc. projects revenue to be in the range of $1,315 million to $1,325 million. The company projects operating income to grow in the range of 8.10 percent to 8.30 percent.
Working capital increases
TeleTech Holdings, Inc. has recorded an increase in the working capital over the last year. It stood at $255.05 million as at Dec. 31, 2016, up 22.52 percent or $46.89 million from $208.17 million on Dec. 31, 2015. Current ratio was at 2.43 as on Dec. 31, 2016, up from 2.01 on Dec. 31, 2015.
Days sales outstanding went up to 40 days for the quarter compared with 38 days for the same period last year.
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