Myriad Genetics (MYGN) has reported 87.83 percent plunge in profit for the quarter ended Mar. 31, 2017. The company has earned $4.20 million, or $0.06 a share in the quarter, compared with $34.50 million, or $0.47 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $18.10 million, or $0.27 a share compared with $29.80 million or $0.41 a share, a year ago.

Revenue during the quarter grew 3.36 percent to $196.90 million from $190.50 million in the previous year period. Gross margin for the quarter contracted 140 basis points over the previous year period to 77.50 percent. Total expenses were 93.45 percent of quarterly revenues, up from 77.64 percent for the same period last year. That has resulted in a contraction of 1581 basis points in operating margin to 6.55 percent.

Operating income for the quarter was $12.90 million, compared with $42.60 million in the previous year period.

However, the adjusted operating income for the quarter stood at $24 million compared to $45.80 million in the prior year period. At the same time, adjusted operating margin contracted 1185 basis points in the quarter to 12.19 percent from 24.04 percent in the last year period.

"We were very encouraged to see sequential growth in hereditary cancer testing volumes for the second consecutive quarter," said Mark C. Capone, president and chief executive officer, Myriad Genetics. "Coupled with meaningful sequential volume growth in all of our major pipeline tests including GeneSight, Vectra DA, Prolaris, and EndoPredict, we believe we are rapidly approaching an important inflection in our business where our new products will drive accelerated revenue growth and profitability."

For the fourth-quarter, Myriad Genetics projects revenue to be in the range of $192 million to $194 million.  The company forecasts diluted earnings per share to be in the range of $0.11 to $0.13.  On an adjusted basis, the company forecasts diluted earnings per share to be in the range of $0.26 to $0.28. 

For financial year 2017, Myriad Genetics projects revenue to be in the range of $763 million to $765 million.  The company forecasts diluted earnings per share to be in the range of $0.23 to $0.25, the company forecasts diluted earnings per share to be in the range of $1.01 to $1.03 on adjusted basis.

The company has spent $150.60 million cash to meet investing activities during the nine month period as against cash outgo of $47.60 million in the last year period.

Cash flow from financing activities was $135.10 million for the nine month period as against cash outgo of $22 million in the last year period.

Cash and cash equivalents stood at $123.80 million as on Mar. 31, 2017, up 2.74 percent or $3.30 million from $120.50 million on Mar. 31, 2016.

Working capital drops significantly
Myriad Genetics has witnessed a decline in the working capital over the last year. It stood at $126.60 million as at Mar. 31, 2017, down 58.67 percent or $179.70 million from $306.30 million on Mar. 31, 2016. Current ratio was at 1.57 as on Mar. 31, 2017, down from 5.63 on Mar. 31, 2016.

Cash conversion cycle (CCC) has decreased to 52 days for the quarter from 71 days for the last year period. Days sales outstanding went up to 48 days for the quarter compared with 44 days for the same period last year.

Days inventory outstanding has decreased to 48 days for the quarter compared with 62 days for the previous year period. At the same time, days payable outstanding went up to 44 days for the quarter from 34 for the same period last year.