Tesco Corporation (TESO) saw its loss widen to $22.10 million, or $0.48 a share for the quarter ended Sep. 30, 2016. In the previous year period, the company reported a loss of $19.90 million, or $0.51 a share. On the other hand, adjusted net loss for the quarter widened to $17.30 million, or $0.37 a share from a loss of $12.50 million or $0.32 a share, a year ago. Revenue during the quarter plunged 50.49 percent to $30.40 million from $61.40 million in the previous year period. Gross margin for the quarter stood at negative 45.72 percent as compared to a negative 7 percent for the previous year period. Operating margin for the quarter stood at negative 72.04 percent as compared to a negative 25.57 percent for the previous year period.
Operating loss for the quarter was $21.90 million, compared with an operating loss of $15.70 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at negative $9.10 million compared to negative $0.90 million in the prior year second quarter. At the same time, adjusted EBITDA margin stood at negative 29.93 percent for the quarter compared to negative 1.47 percent in the last year period.
Fernando Assing, Tesco's Chief Executive Officer, commented, "With global energy markets signaling the formation of an oilfield services activity bottom late in 2016, we are well positioned competitively and have a liquidity position that will allow us to take advantage of opportunities to start growing our business and deploying our new technologies."
Operating cash flow remains negative
Tesco Corporation has spent $5.60 million cash to meet operating activities during the nine month period as against cash outgo of $0.20 million in the last year period. The company has spent $1.40 million cash to meet investing activities during the nine month period as against cash outgo of $9.70 million in the last year period. It has incurred net capital expenditure of $1.60 million on net basis during the nine month period, down 86.09 percent or $9.90 million from year ago period.
Cash flow from financing activities was $45.60 million for the nine month period as against cash outgo of $5.80 million in the last year period.
Cash and cash equivalents stood at $90.10 million as on Sep. 30, 2016, up 58.63 percent or $33.30 million from $56.80 million on Sep. 30, 2015.
Working capital declines
Tesco Corporation has witnessed a decline in the working capital over the last year. It stood at $200.70 million as at Sep. 30, 2016, down 14.95 percent or $35.28 million from $235.98 million on Sep. 30, 2015. Current ratio was at 7.41 as on Sep. 30, 2016, up from 5.76 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 252 days for the quarter from 270 days for the last year period. Days sales outstanding went up to 204 days for the quarter compared with 136 days for the same period last year.
Days inventory outstanding has decreased to 84 days for the quarter compared with 162 days for the previous year period. At the same time, days payable outstanding went up to 35 days for the quarter from 28 for the same period last year.
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