Tower International, Inc. (TOWR) has reported 107.03 percent jump in profit for the quarter ended Mar. 31, 2017. The company has earned $17.34 million, or $0.83 a share in the quarter, compared with $8.38 million, or $0.39 a share for the same period last year. On an adjusted basis, earnings per share were at $0.76 for the quarter compared with $0.65 in the same period last year.

Revenue during the quarter went up marginally by 1.72 percent to $497.59 million from $489.19 million in the previous year period. Gross margin for the quarter contracted 26 basis points over the previous year period to 11.41 percent. Total expenses were 95.27 percent of quarterly revenues, up from 95.22 percent for the same period last year. That has resulted in a contraction of 5 basis points in operating margin to 4.73 percent.

Operating income for the quarter was $23.54 million, compared with $23.38 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $46.20 million compared with $45.10 million in the prior year period. At the same time, adjusted EBITDA margin improved 7 basis points in the quarter to 9.29 percent from 9.22 percent in the last year period.

"Tower delivered solid financial results in the quarter as revenue and earnings were above our previous outlook," said chief executive officer Jim Gouin. "We continue to invest in the growth of Tower and are well positioned to grow our business at a faster pace than the industry over the coming years. This growth will be fueled by what we believe to be secular trends associated with OEM outsourcing driven by lightweighting and changing technologies such as electrification.” Gouin continued, “Regardless of how vehicles are eventually powered or driven, Tower’s structural components and assemblies remain both relevant and necessary.”

For fiscal year 2017, the company projects diluted earnings per share to be $3.60 on adjusted basis.

The company has spent $24.32 million cash to meet investing activities during the quarter as against cash outgo of $26.11 million in the last year period.

Cash flow from financing activities was $36.86 million for the quarter as against cash outgo of $47.71 million in the last year period.

Cash and cash equivalents stood at $27.52 million as on Mar. 31, 2017, down 63.20 percent or $47.27 million from $74.80 million on Mar. 31, 2016.

Working capital increases sharply
Tower International has recorded an increase in the working capital over the last year. It stood at $97.57 million as at Mar. 31, 2017, up 178.62 percent or $62.55 million from $35.02 million on Mar. 31, 2016. Current ratio was at 1.20 as on Mar. 31, 2017, up from 1.07 on Mar. 31, 2016.

Cash conversion cycle (CCC) has increased to 6 days for the quarter from 1 days for the last year period. Days sales outstanding went down to 45 days for the quarter compared with 50 days for the same period last year.

Days inventory outstanding has decreased to 8 days for the quarter compared with 15 days for the previous year period. At the same time, days payable outstanding went down to 59 days for the quarter from 64 for the same period last year.