Alliance Data Systems Corporation (ADS) has reported a 93.97 percent plunge in profit for the quarter ended Dec. 31, 2016. The company has earned $10.50 million, or $0.18 a share in the quarter, compared with $174.20 million, or $2.35 a share for the same period last year. Revenue during the quarter grew 4.50 percent to $1,827.60 million from $1,748.90 million in the previous year period. Gross margin for the quarter contracted 712 basis points over the previous year period to 32.64 percent. Total expenses were 90.17 percent of quarterly revenues, up from 79.18 percent for the same period last year. That has resulted in a contraction of 1100 basis points in operating margin to 9.83 percent.
Operating income for the quarter was $179.60 million, compared with $364.20 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $565.80 million compared with $507.10 million in the prior year period. At the same time, adjusted EBITDA margin improved 196 basis points in the quarter to 30.96 percent from 29 percent in the last year period.
Ed Heffernan, president and chief executive officer of Alliance Data, commented, "Excluding the one-time charge associated with a newly enacted provincial law in Canada, we posted a solid year with both revenue and core EPS increasing double-digits primarily driven by our BrandLoyalty and Card Services businesses."
For fiscal year 2017, Alliance Data Systems Corporation expects revenue to be $7,700 million. It expects diluted earnings per share to be $18.50 on adjusted basis for the same period.
Operating cash flow improves
Alliance Data Systems Corporation has generated cash of $2,088.40 million from operating activities during the year, up 22.43 percent or $382.60 million, when compared with the last year. The company has spent $4,063 million cash to meet investing activities during the year as against cash outgo of $3,362.60 million in the last year.
Cash flow from financing activities was $2,663.40 million for the year, up 50.23 percent or $890.50 million, when compared with the last year.
Cash and cash equivalents stood at $1,859.20 million as on Dec. 31, 2016, up 59.18 percent or $691.20 million from $1,168 million on Dec. 31, 2015.
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