Clearfield, Inc. (CLFD) has reported 41.04 percent plunge in profit for the quarter ended Dec. 31, 2016. The company has earned $0.88 million, or $0.06 a share in the quarter, compared with $1.49 million, or $0.11 a share for the same period last year.
Revenue during the quarter grew 16.42 percent to $18.27 million from $15.69 million in the previous year period. Gross margin for the quarter contracted 309 basis points over the previous year period to 39.46 percent. Total expenses were 93.48 percent of quarterly revenues, up from 87.38 percent for the same period last year. That has resulted in a contraction of 610 basis points in operating margin to 6.52 percent.
Operating income for the quarter was $1.19 million, compared with $1.98 million in the previous year period.
"We began the new fiscal year with much of the same momentum we experienced throughout fiscal 2016," said Clearfield chief executive officer, Cheri Beranek. "Revenue for the first quarter grew by 16% year-over-year, reflecting strong growth in our wireline and wireless markets, despite a seasonally-driven reduction in demand from our cable TV customers. Most notably, our sales to the Tier 1 group represented 9% of our total revenue for the quarter, reflecting the positive traction we’ve gained with this customer group so far."
Operating cash flow turns negative
Clearfield, Inc. has spent $0.61 million cash to meet operating activities during the quarter as against cash inflow of $2.26 million in the last year period. The company has spent $5.51 million cash to meet investing activities during the quarter as against cash inflow of $0.48 million in the last year period.
Cash flow from financing activities was $0.16 million for the quarter as against cash outgo of $0.11 million in the last year period.
Cash and cash equivalents stood at $22.06 million as on Dec. 31, 2016, up 6.56 percent or $1.36 million from $20.70 million on Dec. 31, 2015.
Working capital increases
Clearfield, Inc. has recorded an increase in the working capital over the last year. It stood at $42.69 million as at Dec. 31, 2016, up 11.50 percent or $4.40 million from $38.28 million on Dec. 31, 2015. Current ratio was at 10.61 as on Dec. 31, 2016, down from 11.40 on Dec. 31, 2015.
Cash conversion cycle (CCC) has decreased to 50 days for the quarter from 81 days for the last year period. Days sales outstanding went up to 34 days for the quarter compared with 32 days for the same period last year.
Days inventory outstanding has decreased to 36 days for the quarter compared with 72 days for the previous year period. At the same time, days payable outstanding went down to 20 days for the quarter from 23 for the same period last year.
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