Trecora Resources (TREC) has reported an 86.08 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $0.74 million, or $0.03 a share in the quarter, compared with $5.32 million, or $0.21 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $2.10 million, compared with $6.65 million in the previous year period. Revenue during the quarter dropped 14.63 percent to $57.14 million from $66.94 million in the previous year period. Gross margin for the quarter contracted 837 basis points over the previous year period to 15.58 percent. Total expenses were 92.78 percent of quarterly revenues, up from 83.47 percent for the same period last year. That has resulted in a contraction of 930 basis points in operating margin to 7.22 percent.
Operating income for the quarter was $4.13 million, compared with $11.06 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $7.23 million compared with $13.89 million in the prior year period. At the same time, adjusted EBITDA margin contracted 810 basis points in the quarter to 12.65 percent from 20.75 percent in the last year period.
Trecora president and chief executive officer Simon Upfill-Brown commented, "Despite a challenging petrochemical market environment, we saw a 16.4% sequential increase in prime product volume in the third quarter. Several important customer accounts increased their volume demands in the quarter which we expect will continue. Additionally, as a result of our on-going capacity expansion investments, we are poised to benefit from the anticipated 60-70% increase in pentane volumes by 2021."
Working capital increases marginally
Trecora Resources has recorded an increase in the working capital over the last year. It stood at $32.16 million as at Sep. 30, 2016, up 1.98 percent or $0.62 million from $31.54 million on Sep. 30, 2015. Current ratio was at 2.41 as on Sep. 30, 2016, up from 2.27 on Sep. 30, 2015. Cash conversion cycle (CCC) has decreased to 38 days for the quarter from 41 days for the last year period. Days sales outstanding went up to 37 days for the quarter compared with 31 days for the same period last year.
Days inventory outstanding has decreased to 18 days for the quarter compared with 25 days for the previous year period. At the same time, days payable outstanding went up to 17 days for the quarter from 15 for the same period last year.
Debt moves up marginally
Trecora Resources has witnessed an increase in total debt over the last one year. It stood at $78.18 million as on Sep. 30, 2016, up 3.97 percent or $2.98 million from $75.20 million on Sep. 30, 2015. Total debt was 27.61 percent of total assets as on Sep. 30, 2016, compared with 30.47 percent on Sep. 30, 2015. Debt to equity ratio was at 0.48 as on Sep. 30, 2016, down from 0.53 as on Sep. 30, 2015. Interest coverage ratio deteriorated to 7.27 for the quarter from 20.68 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
