Travelzoo Inc (TZOO) has reported an 81.72 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $1.62 million, or $0.12 a share in the quarter, compared with $8.86 million, or $0.60 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $1.62 million, or $0.12 a share compared with $0.44 million or $0.03 a share, a year ago. Revenue during the quarter dropped 9.75 percent to $30.44 million from $33.73 million in the previous year period. Gross margin for the quarter expanded 302 basis points over the previous year period to 88.96 percent. Total expenses were 92.76 percent of quarterly revenues, down from 97.45 percent for the same period last year. This has led to an improvement of 469 basis points in operating margin to 7.24 percent.
Operating income for the quarter was $2.20 million, compared with $0.86 million in the previous year period.
"The launch of a new Travelzoo site in October was well received by our members," said Holger Bartel, chairman and Global chief executive officer. "The new responsive site makes it easy to search by date for outstanding travel and entertainment offers researched by our global staff, many of which Travelzoo has negotiated exclusively for its members. We intend to leverage Travelzoo's global reach and trusted brand to grow revenue and increase profitability in future periods."
Operating cash flow improves significantly
Travelzoo Inc has generated cash of $1.92 million from operating activities during the nine month period, up 202.69 percent or $1.28 million, when compared with the last year period. The company has spent $0.80 million cash to meet investing activities during the nine month period as against cash outgo of $0.82 million in the last year period.
The company has spent $11.33 million cash to carry out financing activities during the nine month period as against cash outgo of $18.44 million in the last year period.
Cash and cash equivalents stood at $24.84 million as on Sep. 30, 2016, down 28.15 percent or $9.73 million from $34.57 million on Sep. 30, 2015.
Working capital declines
Travelzoo Inc has witnessed a decline in the working capital over the last year. It stood at $17.46 million as at Sep. 30, 2016, down 20.29 percent or $4.44 million from $21.90 million on Sep. 30, 2015. Current ratio was at 1.59 as on Sep. 30, 2016, down from 1.59 on Sep. 30, 2015.
Days sales outstanding went up to 57 days for the quarter compared with 53 days for the same period last year.
At the same time, days payable outstanding went up to 549 days for the quarter from 432 for the same period last year.
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