Vectrus Inc (VEC) has reported a 52.90 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $6.61 million, or $0.60 a share in the quarter, compared with $14.03 million, or $1.29 a share for the same period last year.
Revenue during the quarter dropped 5.11 percent to $283.78 million from $299.06 million in the previous year period. Gross margin for the quarter expanded 22 basis points over the previous year period to 9.20 percent. Total expenses were 96.07 percent of quarterly revenues, down from 97.17 percent for the same period last year. This has led to an improvement of 110 basis points in operating margin to 3.93 percent.
Operating income for the quarter was $11.16 million, compared with $8.47 million in the previous year period.
“We are pleased with our financial performance in the quarter,” said Ken Hunzeker, chief executive officer and president of Vectrus. “Our business continues to generate consistent cash flow and we have capitalized on our strong cash collections in order to make additional voluntary debt payments during the quarter.”
Vectrus Inc forecasts revenue to be in the range of $1,180 million to $1,200 million for fiscal year 2016. For fiscal year 2016, the company expects diluted earnings per share to be in the range of $2.07 to $2.23.
Operating cash flow improves significantly
Vectrus Inc has generated cash of $33.48 million from operating activities during the nine month period, up 233.37 percent or $23.44 million, when compared with the last year period.
Cash flow from investing activities was $0.06 million for the nine month period as against cash outgo of $0.77 million in the last year period.
The company has spent $20.80 million cash to carry out financing activities during the nine month period as against cash outgo of $10.73 million in the last year period.
Cash and cash equivalents stood at $53.35 million as on Sep. 30, 2016, up 29.62 percent or $12.19 million from $41.16 million on Sep. 25, 2015.
Working capital increases sharply
Vectrus Inc has recorded an increase in the working capital over the last year. It stood at $54.93 million as at Sep. 30, 2016, up 63.84 percent or $21.41 million from $33.53 million on Sep. 25, 2015. Current ratio was at 1.31 as on Sep. 30, 2016, up from 1.14 on Sep. 25, 2015.
Days sales outstanding went down to 60 days for the quarter compared with 65 days for the same period last year.
At the same time, days payable outstanding went down to 34 days for the quarter from 36 for the same period last year.
Debt comes down
Vectrus Inc has recorded a decline in total debt over the last one year. It stood at $91.81 million as on Sep. 30, 2016, down 21.89 percent or $25.73 million from $117.54 million on Sep. 25, 2015. Total debt was 20.29 percent of total assets as on Sep. 30, 2016, compared with 23.39 percent on Sep. 25, 2015. Debt to equity ratio was at 0.82 as on Sep. 30, 2016, down from 1.41 as on Sep. 25, 2015. Interest coverage ratio improved to 8.28 for the quarter from 5.35 for the same period last year.
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