Tenneco (TEN) has reported a 41.18 percent plunge in profit for the quarter ended Dec. 31, 2016. The company has earned $40 million, or $0.73 a share in the quarter, compared with $68 million, or $1.17 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $92 million, or $1.67 a share compared with $80 million or $1.39 a share, a year ago.
Revenue during the quarter grew 6.11 percent to $2,155 million from $2,031 million in the previous year period. Gross margin for the quarter expanded 5 basis points over the previous year period to 16.94 percent. Total expenses were 96.47 percent of quarterly revenues, up from 93.60 percent for the same period last year. That has resulted in a contraction of 287 basis points in operating margin to 3.53 percent.
Operating income for the quarter was $76 million, compared with $130 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $209 million compared with $197 million in the prior year period. At the same time, adjusted EBITDA margin was almost stable in the quarter to 9.70 percent when compared with the last year period.
"We finished the year with a solid fourth quarter and another year of record results, with full-year total revenue again outpacing industry production," said Gregg Sherrill, chairman and chief executive officer, Tenneco. "We also continued to do an excellent job converting this top line growth to drive record-high earnings for 2016 and greater profitability with our seventh consecutive full year of value-add adjusted EBIT margin improvement."
For the first-quarter 2017, Tenneco forecasts revenue to grow at 7 percent.
Operating cash flow declines
Tenneco has generated cash of $489 million from operating activities during the year, down 5.42 percent or $28 million, when compared with the last year.
The company has spent $340 million cash to meet investing activities during the year as against cash outgo of $303 million in the last year. It has incurred net capital expenditure of $339 million on net basis during the year, up 11.15 percent or $34 million from year ago.
The company has spent $91 million cash to carry out financing activities during the year as against cash outgo of $172 million in the last year period.
Cash and cash equivalents stood at $347 million as on Dec. 31, 2016, up 20.91 percent or $60 million from $287 million on Dec. 31, 2015.
Working capital increases
Tenneco has recorded an increase in the working capital over the last year. It stood at $632 million as at Dec. 31, 2016, up 22.24 percent or $115 million from $517 million on Dec. 31, 2015. Current ratio was at 1.32 as on Dec. 31, 2016, up from 1.29 on Dec. 31, 2015.
Debt moves up
Tenneco has witnessed an increase in total debt over the last one year. It stood at $1,384 million as on Dec. 31, 2016, up 14.38 percent or $174 million from $1,210 million on Dec. 31, 2015. Total debt was 31.87 percent of total assets as on Dec. 31, 2016, compared with 30.50 percent on Dec. 31, 2015. Debt to equity ratio was at 2.17 as on Dec. 31, 2016, down from 2.55 as on Dec. 31, 2015. Interest coverage ratio deteriorated to 4.75 for the quarter from 7.22 for the same period last year.
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