West Corporation (WSTC) has reported a 3.94 percent fall in profit for the quarter ended Sep. 30, 2016. The company has earned $47.54 million, or $0.56 a share in the quarter, compared with $49.48 million, or $0.58 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $64.29 million, or $0.76 a share compared with $66.86 million or $0.79 a share, a year ago.
Revenue during the quarter went down marginally by 0.53 percent to $571.41 million from $574.45 million in the previous year period. Gross margin for the quarter contracted 49 basis points over the previous year period to 56.63 percent. Total expenses were 80.84 percent of quarterly revenues, up from 78.35 percent for the same period last year. That has resulted in a contraction of 248 basis points in operating margin to 19.16 percent.
Operating income for the quarter was $109.50 million, compared with $124.35 million in the previous year period.
However, the adjusted operating income for the quarter stood at $133.26 million compared to $146.64 million in the prior year period. At the same time, adjusted operating margin contracted 221 basis points in the quarter to 23.32 percent from 25.53 percent in the last year period.
"The second quarter was very productive and significant for West Corporation," said Tom Barker, chairman and chief executive officer. "We refinanced approximately $1.9 billion of long-term debt and closed on the sale of the real estate associated with the divested agent-based businesses. We also had strong revenue growth in the Safety Services and Interactive Services segments."
Working capital turns positive
Working capital of West Corporation has turned positive to $228.47 million on Sep. 30, 2016 from negative $6.62 million on Sep. 30, 2015. Current ratio was at 1.46 as on Sep. 30, 2016, up from 0.99 on Sep. 30, 2015.
Days sales outstanding were almost stable at 62 days for the quarter, when compared with the last year period.
At the same time, days payable outstanding went down to 29 days for the quarter from 33 for the same period last year.
Debt comes down marginally
West Corporation has recorded a decline in total debt over the last one year. It stood at $3,239.25 million as on Sep. 30, 2016, down 4.73 percent or $160.88 million from $3,400.12 million on Sep. 30, 2015. Total debt was 93.15 percent of total assets as on Sep. 30, 2016, compared with 95.59 percent on Sep. 30, 2015.
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