Capella Education Company (CPLA) has reported 1.91 percent fall in profit for the quarter ended Dec. 31, 2016. The company has earned $11.43 million, or $0.97 a share in the quarter, compared with $11.65 million, or $0.96 a share for the same period last year.
Revenue during the quarter grew 4.88 percent to $111.31 million from $106.13 million in the previous year period. Gross margin for the quarter expanded 25 basis points over the previous year period to 57.30 percent. Total expenses were 83.60 percent of quarterly revenues, up from 80.65 percent for the same period last year. That has resulted in a contraction of 294 basis points in operating margin to 16.40 percent.
Operating income for the quarter was $18.26 million, compared with $20.53 million in the previous year period.
"We delivered solid results in 2016 and made significant progress in executing our vision of providing the most direct path between learning and employment," said Kevin Gilligan, chairman and chief executive officer. "We believe our ‘most direct path’ innovations, including our flexible degree and job-ready skills offerings, will drive long-term growth by expanding our addressable market, creating new sources of revenue, and better positioning us to deliver differentiated value to both consumers and employers."
For the first-quarter, Capella Education Company projects revenue to grow in the range of 5 percent to 6 percent. The company projects operating income to grow in the range of 14.50 percent to 15.50 percent.
For the financial year 2017, Capella Education Company projects revenue to grow in the range of 3 percent to 5 percent.
Operating cash flow improves significantlyCapella Education Company has generated cash of $82.27 million from operating activities during the year, up 36.37 percent or $21.94 million, when compared with the last year. The company has spent $39.31 million cash to meet investing activities during the year as against cash outgo of $24.04 million in the last year.
The company has spent $37.39 million cash to carry out financing activities during the year as against cash outgo of $42.24 million in the last year period.
Cash and cash equivalents stood at $93.57 million as on Dec. 31, 2016, up 8.67 percent or $7.47 million from $86.10 million on Dec. 31, 2015.
Working capital increases
Capella Education Company has recorded an increase in the working capital over the last year. It stood at $124.60 million as at Dec. 31, 2016, up 20.71 percent or $21.37 million from $103.23 million on Dec. 31, 2015. Current ratio was at 3.35 as on Dec. 31, 2016, up from 3.24 on Dec. 31, 2015.
Days sales outstanding went up to 9 days for the quarter compared with 7 days for the same period last year.
At the same time, days payable outstanding went up to 4 days for the quarter from 1 for the same period last year.
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