Meredith Corporation (MDP) has reported a 17.86 percent fall in profit for the quarter ended Dec. 31, 2015. The company has earned $32.52 million, or $0.72 a share in the quarter, compared with $39.59 million, or $0.87 a share for the same period last year. Revenue during the quarter went up marginally by 1.88 percent to $406.41 million from $398.90 million in the previous year period. Gross margin for the quarter contracted 200 basis points over the previous year period to 62.83 percent. Total expenses were 85.21 percent of quarterly revenues, up from 82.74 percent for the same period last year. That has resulted in a contraction of 247 basis points in operating margin to 14.79 percent.
Operating income for the quarter was $60.11 million, compared with $68.86 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $79.06 million compared with $92.63 million in the prior year period. At the same time, adjusted EBITDA margin contracted 377 basis points in the quarter to 19.45 percent from 23.22 percent in the last year period.
"We're pleased to report strong advertising performance - including growth on an organic basis - in our National Media Group during the second quarter of fiscal 2016," said Meredith chairman and chief executive officer Stephen M. Lacy. "Additionally, our Local Media Group delivered excellent growth in non-political advertising revenues from both our existing stations and our recent strategic acquisitions."
For the third-quarter, Meredith Corporation expects revenue to grow at by percent. It projects diluted earnings per share to be in the range of $0.77 to $0.82.
For financial year 2016, It projects diluted earnings per share to be in the range of $3.05 to $3.25.
Operating cash flow drops significantly
Meredith Corporation has generated cash of $47.70 million from operating activities during the first half, down 35.86 percent or $26.67 million, when compared with the last year period. The company has spent $6.28 million cash to meet investing activities during the first six months as against cash outgo of $195.80 million in the last year period.
The company has spent $36.39 million cash to carry out financing activities during the first six months as against cash inflow of $102.97 million in the last year period.
Cash and cash equivalents stood at $27.86 million as on Dec. 31, 2015, up 53.72 percent or $9.74 million from $18.12 million on Dec. 31, 2014.
Working capital drops significantly
Meredith Corporation has witnessed a decline in the working capital over the last year. It stood at $21.36 million as at Dec. 31, 2015, down 44.17 percent or $16.90 million from $38.26 million on Dec. 31, 2014. Current ratio was at 1.04 as on Dec. 31, 2015, down from 1.08 on Dec. 31, 2014.
Cash conversion cycle (CCC) has decreased to 26 days for the quarter from 29 days for the last year period. Days sales outstanding went up to 65 days for the quarter compared with 64 days for the same period last year.
Days inventory outstanding has decreased to 14 days for the quarter compared with 16 days for the previous year period. At the same time, days payable outstanding went up to 53 days for the quarter from 50 for the same period last year.
Debt comes down
Meredith Corporation has recorded a decline in total debt over the last one year. It stood at $798.75 million as on Dec. 31, 2015, down 6.99 percent or $60 million from $858.75 million on Dec. 31, 2014. Total debt was 27.75 percent of total assets as on Dec. 31, 2015, compared with 30.64 percent on Dec. 31, 2014. Debt to equity ratio was at 0.83 as on Dec. 31, 2015, down from 0.93 as on Dec. 31, 2014.
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