Revenue during the quarter grew 9.10 percent to $458.12 million from $419.92 million in the previous year period. Gross margin for the quarter expanded 895 basis points over the previous year period to 31.29 percent. Total expenses were 87.05 percent of quarterly revenues, down from 99.23 percent for the same period last year. This has led to an improvement of 1218 basis points in operating margin to 12.95 percent.

Operating income for the quarter was $59.32 million, compared with $3.23 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $65.57 million compared with $93.10 million in the prior year period. At the same time, adjusted EBITDA margin contracted 786 basis points in the quarter to 14.31 percent from 22.17 percent in the last year period.

"On a consolidated basis, first quarter 2017 Adjusted EBITDA was $65.6 million. As expected, during the quarter we saw unprecedented increases in raw material costs for our Polymer segment and, as a result, our Adjusted EBITDA was negatively impacted by the lag in realization of price increases. While we expect the full realization of price increases implemented to address the increase in raw material costs to be completed in the second quarter 2017, the raw material cost trend itself has also reversed as we move into the second quarter of the year. As we have pointed out previously, we continue to see competitive conditions for SIS polymer grades in our Performance Products business," said Kevin M. Fogarty, Kraton's president and chief executive officer. "For our Chemical segment, we are encouraged by the 15% increase in sales volume compared to the first quarter 2016. However, segment margins continue to be adversely impacted by availability of low-cost C5 hydrocarbon alternatives, and pricing pressure for TOFA and TOR products in general. Regarding TOFA markets specifically, we implemented a global price increase of $120 per metric ton effective March 15th, reflecting an improving demand outlook for TOFA and, to a lesser extent, cost increases for CTO raw materials," Fogarty added.

The company has spent $34.35 million cash to meet investing activities during the quarter as against cash outgo of $1,272.43 million in the last year period.

Cash flow from financing activities was $11.23 million for the quarter, down 99.14 percent or $1,290.61 million, when compared with the last year period.

Cash and cash equivalents stood at $104.07 million as on Mar. 31, 2017, up 32.77 percent or $25.69 million from $78.38 million on Mar. 31, 2016.

Working capital increases marginally
Kraton Corp has recorded an increase in the working capital over the last year. It stood at $479.86 million as at Mar. 31, 2017, up 1.57 percent or $7.40 million from $472.46 million on Mar. 31, 2016. Current ratio was at 2.47 as on Mar. 31, 2017, down from 2.94 on Mar. 31, 2016.

Cash conversion cycle (CCC) has decreased to 58 days for the quarter from 96 days for the last year period. Days sales outstanding went down to 32 days for the quarter compared with 34 days for the same period last year.

Days inventory outstanding has decreased to 59 days for the quarter compared with 88 days for the previous year period. At the same time, days payable outstanding went up to 32 days for the quarter from 26 for the same period last year.