Tennant Company (TNC) has reported 16.47 percent rise in profit for the quarter ended Dec. 31, 2016. The company has earned $15.37 million, or $0.85 a share in the quarter, compared with $13.20 million, or $0.73 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $15.37 million, or $0.85 a share compared with $14.03 million or $0.78 a share, a year ago. Revenue during the quarter went up marginally by 2.86 percent to $211.75 million from $205.85 million in the previous year period. Gross margin for the quarter expanded 176 basis points over the previous year period to 44.16 percent. Total expenses were 89.33 percent of quarterly revenues, down from 91.37 percent for the same period last year. This has led to an improvement of 204 basis points in operating margin to 10.67 percent.
Operating income for the quarter was $22.59 million, compared with $17.76 million in the previous year period.
However, the adjusted operating income for the quarter stood at $22.59 million compared to $19.73 million in the prior year period. At the same time, adjusted operating margin improved 108 basis points in the quarter to 10.67 percent from 9.58 percent in the last year period.
“We executed well against our strategies in the 2016 fourth quarter and made further progress against our goals,” said Chris Killingstad, Tennant Company's president and chief executive officer. “We are pleased with our fourth quarter results. As we anticipated, Tennant returned to organic sales growth in the quarter, led by sales in our largest region, the Americas, and growth in EMEA.”
For fiscal year 2017, Tennant Company forecasts revenue to be in the range of $810 million to $830 million and its expects diluted earnings per share to be in the range of $2.20 to $2.43 and its adjusted expects diluted earnings per share to be in the range of $2.50 to $2.70.
Operating cash flow improves significantly
Tennant Company has generated cash of $57.88 million from operating activities during the year, up 27.96 percent or $12.65 million, when compared with the last year. The company has spent $40.44 million cash to meet investing activities during the year as against cash outgo of $23.58 million in the last year. It has incurred net capital expenditure of $25.91 million on net basis during the year, up 6 percent or $1.47 million from year ago.
The company has spent $9.56 million cash to carry out financing activities during the year as against cash outgo of $61.40 million in the last year period.
Cash and cash equivalents stood at $58.03 million as on Dec. 31, 2016, up 13.12 percent or $6.73 million from $51.30 million on Dec. 31, 2015.
Working capital increases marginally
Tennant Company has recorded an increase in the working capital over the last year. It stood at $165.09 million as at Dec. 31, 2016, up 2.91 percent or $4.67 million from $160.43 million on Dec. 31, 2015. Current ratio was at 2.24 as on Dec. 31, 2016, up from 2.20 on Dec. 31, 2015.
Cash conversion cycle (CCC) has increased to 45 days for the quarter from 42 days for the last year period. Days sales outstanding went up to 32 days for the quarter compared with 31 days for the same period last year.
Days inventory outstanding was almost stable at 31 days for the quarter, when compared with the last year period. At the same time, days payable outstanding went down to 18 days for the quarter from 20 for the same period last year.
Debt increases substantially
Tennant Company has witnessed an increase in total debt over the last one year. It stood at $36.19 million as on Dec. 31, 2016, up 46.81 percent or $11.54 million from $24.65 million on Dec. 31, 2015. Total debt was 7.70 percent of total assets as on Dec. 31, 2016, compared with 5.70 percent on Dec. 31, 2015. Debt to equity ratio was at 0.13 as on Dec. 31, 2016, up from 0.10 as on Dec. 31, 2015. Interest coverage ratio improved to 62.74 for the quarter from 58.82 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
