A. Schulman, Inc. (SHLM) has reported a 9.31 percent fall in profit for the quarter ended May 31, 2017. The company has earned $15.78 million, or $0.47 a share in the quarter, compared with $17.40 million, or $0.53 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $18.55 million, or $0.63 a share compared with $25.23 million or $0.79 a share, a year ago.
Revenue during the quarter went down marginally by 0.71 percent to $645.80 million from $650.44 million in the previous year period. Gross margin for the quarter contracted 159 basis points over the previous year period to 15.24 percent. Total expenses were 95.01 percent of quarterly revenues, down from 95.14 percent for the same period last year. This has led to an improvement of 13 basis points in operating margin to 4.99 percent.
Operating income for the quarter was $32.22 million, compared with $31.59 million in the previous year period.
However, the adjusted operating income for the quarter stood at $37.12 million compared to $45.79 million in the prior year period. At the same time, adjusted operating margin contracted 129 basis points in the quarter to 5.75 percent from 7.04 percent in the last year period.
Joseph M. Gingo, chairman, president and chief executive officer stated, "I am very pleased with our strong performance in Asia-Pacific, Latin America and Engineered Composites. Our consolidated results were largely influenced by two factors. In our U.S and Canada region, while operations improved, our sales and profitability are still hampered by the complexity of the business consolidation in Evansville, Indiana. In Europe, a significant mid-quarter drop in polyolefin raw material prices interrupted our sales cycle and adversely impacted profitability. We have seen our sales cycle normalize in May and continue into June."
For financial year 2017, A. Schulman, Inc. projects revenue to be in the range of $2,500 million to $2,600 million. The company forecasts diluted earnings per share to be in the range of $2.08 to $2.18 on adjusted basis.
Operating cash flow declines
A. Schulman, Inc. has generated cash of $73.57 million from operating activities during the nine month period, down 23.11 percent or $22.11 million, when compared with the last year period. The company has spent $27.84 million cash to meet investing activities during the nine month period as against cash outgo of $33.43 million in the last year period. It has incurred net capital expenditure of $27.97 million on net basis during the nine month period, down 16.35 percent or $5.47 million from year ago period.
The company has spent $38.42 million cash to carry out financing activities during the nine month period as against cash outgo of $107.50 million in the last year period.
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