Minerals Technologies (MTX) has reported an 125 percent jump in profit for the quarter ended Mar. 29, 2015. The company has earned $35.10 million, or $1.01 a share in the quarter, compared with $15.60 million, or $0.45 a share for the same period last year. Revenue during the quarter surged 85.47 percent to $453.30 million from $244.40 million in the previous year period. Gross margin for the quarter expanded 310 basis points over the previous year period to 25.72 percent. Total expenses were 86.79 percent of quarterly revenues, down from 90.34 percent for the same period last year. This has led to an improvement of 356 basis points in operating margin to 13.21 percent.
Operating income for the quarter was $59.90 million, compared with $23.60 million in the previous year period.
"Minerals Technologies posted a solid financial performance for the first quarter, especially in light of the challenges presented by low oil prices and the slowdown in the steel industry," said chairman and chief executive officer Joseph C. Muscari. "We saw strong contribution in earnings from the three new business units, and continued to track well ahead of our synergies target. In addition, we paid down $40 million in debt."
Operating cash flow improves significantly
Minerals Technologies has generated cash of $19.60 million from operating activities during the quarter, up 28.95 percent or $4.40 million, when compared with the last year period. The company has spent $25.90 million cash to meet investing activities during the quarter as against cash outgo of $10.60 million in the last year period.
The company has spent $38.20 million cash to carry out financing activities during the quarter as against cash outgo of $0.80 million in the last year period. It has made net debt repayment of $37.10 million. It has raised net of $0.80 million by selling common stocks.
Cash and cash equivalents stood at $193.90 million as on Mar. 29, 2015, down 60.67 percent or $299.10 million from $493 million on Mar. 30, 2014.
Working capital declines
Minerals Technologies has witnessed a decline in the working capital over the last year. It stood at $554.40 million as at Mar. 29, 2015, down 15.29 percent or $100.05 million from $654.45 million on Mar. 30, 2014. Current ratio was at 2.76 as on Mar. 29, 2015, down from 4.63 on Mar. 30, 2014.
Cash conversion cycle (CCC) has increased to 91 days for the quarter from 71 days for the last year period. Days sales outstanding went up to 80 days for the quarter compared with 77 days for the same period last year.
Days inventory outstanding has increased to 55 days for the quarter compared with 43 days for the previous year period. At the same time, days payable outstanding went down to 44 days for the quarter from 48 for the same period last year.
Debt increases substantially
Minerals Technologies has witnessed an increase in total debt over the last one year. It stood at $1,424.80 million as on Mar. 29, 2015, up 1,519.96 percent or $1,336.85 million from $87.95 million on Mar. 30, 2014. Total debt was 45.10 percent of total assets as on Mar. 29, 2015, compared with 7.11 percent on Mar. 30, 2014. Debt to equity ratio was at 1.58 as on Mar. 29, 2015, up from 0.10 as on Mar. 30, 2014. Interest coverage ratio deteriorated to 3.89 for the quarter from 236 for the same period last year.
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