HD Supply Holdings, Inc. (HDS) has reported a 94.03 percent plunge in profit for the quarter ended Jan. 29, 2017. The company has earned $52 million, or $0.26 a share in the quarter, compared with $871 million, or $4.33 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $90 million, or $0.44 a share compared with $55 million or $0.27 a share, a year ago. Revenue during the quarter grew 3.16 percent to $1,634 million from $1,584 million in the previous year period. Gross margin for the quarter expanded 56 basis points over the previous year period to 34.27 percent. Total expenses were 91.13 percent of quarterly revenues, down from 91.73 percent for the same period last year. This has led to an improvement of 60 basis points in operating margin to 8.87 percent.
Operating income for the quarter was $145 million, compared with $131 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $169 million compared with $167 million in the prior year period. At the same time, adjusted EBITDA margin contracted 20 basis points in the quarter to 10.34 percent from 10.54 percent in the last year period.
"I am pleased with the team’s performance in fiscal 2016. We delivered growth and solid cash flow while simultaneously transforming our business capabilities," stated Joe DeAngelo, chairman and chief executive officer of HD Supply. "We are intensely focused on controllable execution that contributes to the success of our customers and I am encouraged with our momentum in 2017."
For the first-quarter, HD Supply Holdings, Inc. forecasts revenue to be in the range of $1,840 million to $1,890 million. It expects diluted earnings per share to be in the range of $0.60 to $0.68 on an adjusted basis for the same period.
Operating cash flow improves
HD Supply Holdings, Inc. has generated cash of $513 million from operating activities during the year, up 21.56 percent or $91 million, when compared with the last year. The company has spent $21 million cash to meet investing activities during the year as against cash inflow of $726 million in the last year. It has incurred net capital expenditure of $49 million on net basis during the year, down 40.96 percent or $34 million from year ago.
The company has spent $687 million cash to carry out financing activities during the year as against cash outgo of $962 million in the last year period.
Cash and cash equivalents stood at $75 million as on Jan. 29, 2017, down 72.12 percent or $194 million from $269 million on Jan. 31, 2016.
Working capital declines
HD Supply Holdings, Inc. has witnessed a decline in the working capital over the last year. It stood at $1,004 million as at Jan. 29, 2017, down 9.71 percent or $108 million from $1,112 million on Jan. 31, 2016. Current ratio was at 2.19 as on Jan. 29, 2017, down from 2.28 on Jan. 31, 2016.
Debt comes down
HD Supply Holdings, Inc. has recorded a decline in total debt over the last one year. It stood at $3,812 million as on Jan. 29, 2017, down 11.58 percent or $499 million from $4,311 million on Jan. 31, 2016. Total debt was 66.80 percent of total assets as on Jan. 29, 2017, compared with 71.66 percent on Jan. 31, 2016. Debt to equity ratio was at 3.97 as on Jan. 29, 2017, down from 5.79 as on Jan. 31, 2016. Interest coverage ratio improved to 2.90 for the quarter from 1.58 for the same period last year.
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