Computer Task Group (CTG) swung to a net loss for the quarter ended Sep. 30, 2016. The company has made a net loss of $16.18 million, or $ 1.03 a share in the quarter, against a net profit of $2.07 million, or $0.13 a share in the last year period. On an adjusted basis, the company has earned $591 million, or $0.04 a share for the quarter.
Revenue during the quarter dropped 16.11 percent to $78.06 million from $93.06 million in the previous year period. Gross margin for the quarter contracted 100 basis points over the previous year period to 17.77 percent. Operating margin for the quarter stood at negative 21.11 percent as compared to a positive 3.83 percent for the previous year period.
Operating loss for the quarter was $16.48 million, compared with an operating income of $3.57 million in the previous year period.
However, the adjusted operating profit for the quarter stood at $794 million.
Bud Crumlish, CTG president and chief executive officer, commented, "Revenue for the third quarter reflects recurring weakness at several of our larger staffing clients combined with lower than anticipated demand in our healthcare solutions business. In response, we took action to proactively reduce costs during the quarter, resulting in earnings per share at the high-end of our guidance range."
For financial year 2016, Computer Task Group projects revenue to be in the range of $320 million to $322 million. The company forecasts diluted loss per share to be in the range of $2.24 to $2.26. It company forecasts diluted earnings per share to be in the range of $0.20 to $0.22 on adjusted basis.
For the fourth-quarter 2016, Computer Task Group projects revenue to be in the range of $73 million to $75 million. The company forecasts diluted earnings per share to be in the range of $0.04 to $0.06. On an adjusted basis, the company forecasts diluted earnings per share to be in the range of $0.04 to $0.06.
Operating cash flow turns positive
Computer Task Group has generated cash of $3.82 million from operating activities during the nine month period as against cash outgo of $3.93 million in the last year period.
The company has spent $1.62 million cash to meet investing activities during the nine month period as against cash outgo of $1 million in the last year period.
The company has spent $3.38 million cash to carry out financing activities during the nine month period as against cash outgo of $14.18 million in the last year period.
Cash and cash equivalents stood at $9.78 million as on Sep. 30, 2016, down 53.28 percent or $11.16 million from $20.94 million on Oct. 02, 2015.
Working capital declines
Computer Task Group has witnessed a decline in the working capital over the last year. It stood at $50.62 million as at Sep. 30, 2016, down 14.67 percent or $8.71 million from $59.32 million on Oct. 02, 2015. Current ratio was at 2.40 as on Sep. 30, 2016, down from 2.46 on Oct. 02, 2015.
Days sales outstanding went up to 81 days for the quarter compared with 68 days for the same period last year.
At the same time, days payable outstanding was almost stable at 8 days for the quarter, when compared with the previous year period.
Debt comes down significantly
Computer Task Group has recorded a decline in total debt over the last one year. It stood at $0.50 million as on Sep. 30, 2016, down 95 percent or $9.50 million from $10 million on Oct. 02, 2015. Computer Task Group has recorded a decline in long-term debt over the last one year. It stood at $0.50 million as on Sep. 30, 2016, down 95 percent or $9.50 million from $10 million on Oct. 02, 2015. Total debt was 0.39 percent of total assets as on Sep. 30, 2016, compared with 5.59 percent on Oct. 02, 2015. Debt to equity ratio was at 0.01 as on Sep. 30, 2016, down from 0.09 as on Oct. 02, 2015. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: [email protected]
