Tuesday Morning Corporation (TUES) saw its loss widen to $14.80 million, or $0.34 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $5.24 million, or $0.12 a share. Revenue during the quarter dropped 3.96 percent to $203 million from $211.38 million in the previous year period. Gross margin for the quarter contracted 357 basis points over the previous year period to 33.08 percent. Operating margin for the quarter stood at negative 7.23 percent as compared to a negative 2.81 percent for the previous year period.
Operating loss for the quarter was $14.68 million, compared with an operating loss of $5.93 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at negative $7.80 million compared with $3.16 million in the prior year period. At the same time, adjusted EBITDA margin stood at negative 3.84 percent for the quarter compared to 1.50 percent in the last year period.
Steve Becker, chief executive officer said, “Our third quarter comparable sales performance largely reflected decreased inventory levels in certain core categories in January and February as well as a late seasonal set. As our inventory filled in, we saw improvement during the quarter and we have experienced positive comparable store sales growth in March and April. We have now turned our attention to consistent improvement in our supply chain with a focus on driving our costs down. While we have already made progress, we have considerable work to do and efficiencies to be gained.”
Operating cash flow turns negative
Tuesday Morning Corporation has spent $31.12 million cash to meet operating activities during the nine month period as against cash inflow of $2.55 million in the last year period. The company has spent $27.27 million cash to meet investing activities during the nine month period as against cash outgo of $31.32 million in the last year period. It has incurred net capital expenditure of $27.27 million on net basis during the nine month period, down 12.93 percent or $4.05 million from year ago period.
Cash flow from financing activities was $47.98 million for the nine month period as against cash outgo of $0.96 million in the last year period.
Cash and cash equivalents stood at $3.75 million as on Mar. 31, 2017, down 75.13 percent or $11.32 million from $15.06 million on Mar. 31, 2016.
Working capital increases
Tuesday Morning Corporation has recorded an increase in the working capital over the last year. It stood at $159.38 million as at Mar. 31, 2017, up 10.12 percent or $14.65 million from $144.73 million on Mar. 31, 2016. Current ratio was at 2.32 as on Mar. 31, 2017, up from 2.09 on Mar. 31, 2016.
Days inventory outstanding has decreased to 89 days for the quarter compared with 166 days for the previous year period. At the same time, days payable outstanding went down to 49 days for the quarter from 56 for the same period last year.
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