S&W Seed Co (SANW) has reported a 14.89 percent fall in profit for the quarter ended Dec. 31, 2016. The company has earned $1.16 million, or $0.01 a share in the quarter, compared with $1.36 million, or $0.10 a share for the same period last year. Revenue during the quarer went up marginally by 0.35 percent to $24.23 million from $24.14 million in the previous year period. Gross margin for the quarter expanded 485 basis points over the previous year period to 21.55 percent. Total expenses were 95.72 percent of quarterly revenues, down from 99.17 percent for the same period last year. This has led to an improvement of 345 basis points in operating margin to 4.28 percent.
Operating income for the quarter was $1.04 million, compared with $0.20 million in the previous year period.
S&W Seed forecasts revenue to be $100 million for fiscal year 2017.
Operating cash flow turns negative
S&W Seed has spent $5.99 million cash to meet operating activities during the first half as against cash inflow of $5.26 million in the last year period. The company has spent $1.38 million cash to meet investing activities during the first six months as against cash outgo of $1.22 million in the last year period.
Cash flow from financing activities was $2.66 million for the first six months as against cash outgo of $2.11 million in the last year period.
Cash and cash equivalents stood at $2.11 million as on Dec. 31, 2016, down 59.62 percent or $3.11 million from $5.22 million on Dec. 31, 2015.
Working capital drops significantly
S&W Seed has witnessed a decline in the working capital over the last year. It stood at $5.46 million as at Dec. 31, 2016, down 49.15 percent or $5.28 million from $10.73 million on Dec. 31, 2015. Current ratio was at 1.08 as on Dec. 31, 2016, down from 1.23 on Dec. 31, 2015.
Cash conversion cycle (CCC) has decreased to 68 days for the quarter from 160 days for the last year period. Days sales outstanding went up to 98 days for the quarter compared with 74 days for the same period last year.
Days inventory outstanding has decreased to 103 days for the quarter compared with 191 days for the previous year period. At the same time, days payable outstanding went up to 133 days for the quarter from 105 for the same period last year.
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