Revenue during the quarter grew 3.36 percent to $457.04 million from $442.19 million in the previous year period. Gross margin for the quarter expanded 115 basis points over the previous year period to 13.18 percent. Total expenses were 93.94 percent of quarterly revenues, down from 95.18 percent for the same period last year. This has led to an improvement of 125 basis points in operating margin to 6.06 percent.

Operating income for the quarter was $27.70 million, compared with $21.30 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $50.12 million compared with $43.83 million in the prior year period. At the same time, adjusted EBITDA margin improved 105 basis points in the quarter to 10.97 percent from 9.91 percent in the last year period.

“It was a strong quarter for Tower, in some ways our best ever,” said chief executive officer Mark Malcolm. “We presently believe that industry volume in 2017 will be roughly the same as 2016. Tower is, however, relatively well-positioned regardless of your volume outlook. This reflects the underlying strength and tailwinds at Tower from the higher-margin new business coming on board over the next few years that, absent lower industry volume, is expected to drive further increases in overall margin and best-ever free cash flow.”

The company has spent $75.65 million cash to meet investing activities during the nine month period as against cash outgo of $77.18 million in the last year period.

The company has spent $36.61 million cash to carry out financing activities during the nine month period as against cash outgo of $10.55 million in the last year period.

Cash and cash equivalents stood at $47.22 million as on Sep. 30, 2016, down 53.38 percent or $54.06 million from $101.27 million on Sep. 30, 2015.

Working capital drops significantly
Tower International Inc has witnessed a decline in the working capital over the last year. It stood at $115.65 million as at Sep. 30, 2016, down 37.19 percent or $68.46 million from $184.11 million on Sep. 30, 2015. Current ratio was at 1.24 as on Sep. 30, 2016, down from 1.37 on Sep. 30, 2015.

Cash conversion cycle (CCC) was almost stable at 6 days for the quarter, when compared with the last year period. Days sales outstanding went down to 52 days for the quarter compared with 59 days for the same period last year.

Days inventory outstanding has decreased to 9 days for the quarter compared with 18 days for the previous year period. At the same time, days payable outstanding went down to 67 days for the quarter from 70 for the same period last year.