Zebra Technologies Corporation (ZBRA) swung to a net profit for the quarter ended Apr. 01, 2017. The company has made a net profit of $8 million, or $ 0.16 a share in the quarter, against a net loss of $26 million, or $0.50 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $72 million, or $1.37 a share compared with $56 million or $1.06 a share, a year ago.

Revenue during the quarter went up marginally by 1.88 percent to $865 million from $849 million in the previous year period. Gross margin for the quarter expanded 42 basis points over the previous year period to 46.36 percent. Total expenses were 95.38 percent of quarterly revenues, down from 98.82 percent for the same period last year. This has led to an improvement of 345 basis points in operating margin to 4.62 percent.

Operating income for the quarter was $40 million, compared with $10 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $149 million compared with $140 million in the prior year period. At the same time, adjusted EBITDA margin improved 74 basis points in the quarter to 17.23 percent from 16.49 percent in the last year period.

"During the quarter, our team extended Zebra's leadership through superior execution of our strategy. As a result, we drove better-than-expected first quarter sales performance in our Enterprise segment and achieved earnings per share at the top end of our guidance range. We also retired another $80 million of debt, keeping us on track for at least $300 million of pay down for the full-year," said Anders Gustafsson, chief executive officer of Zebra Technologies. "Given our strong start to 2017, we are raising our full-year sales growth outlook. As we implement the final steps of our integration process in the coming months, we will begin to drive additional operational efficiencies and improved profitable growth."

For the second-quarter 2017, Zebra Technologies Corporation expects revenue to grow in the range of 3 percent to 6 percent. On an adjusted basis, the company projects diluted earnings per share to be in the range of $1.35 to $1.55.

The company has spent $13 million cash to meet investing activities during the quarter as against cash outgo of $20 million in the last year period.

The company has spent $78 million cash to carry out financing activities during the quarter as against cash outgo of $77 million in the last year period.

Cash and cash equivalents stood at $180 million as on Apr. 01, 2017, down 7.22 percent or $14 million from $194 million on Apr. 02, 2016.

Working capital drops significantly

Zebra Technologies Corporation has witnessed a decline in the working capital over the last year. It stood at $248 million as at Apr. 01, 2017, down 39.22 percent or $160 million from $408 million on Apr. 02, 2016. Current ratio was at 1.27 as on Apr. 01, 2017, down from 1.47 on Apr. 02, 2016.

Cash conversion cycle (CCC) has decreased to 39 days for the quarter from 88 days for the last year period. Days sales outstanding went down to 66 days for the quarter compared with 70 days for the same period last year.

Days inventory outstanding has decreased to 37 days for the quarter compared with 79 days for the previous year period. At the same time, days payable outstanding went up to 64 days for the quarter from 61 for the same period last year.