Revenue during the quarter dropped 3.90 percent to $568.68 million from $591.76 million in the previous year period. Gross margin for the quarter expanded 50 basis points over the previous year period to 15.68 percent. Total expenses were 96.25 percent of quarterly revenues, down from 97.30 percent for the same period last year. This has led to an improvement of 105 basis points in operating margin to 3.75 percent.

Operating income for the quarter was $21.34 million, compared with $16.01 million in the previous year period.

However, the adjusted operating income for the quarter stood at $27.38 million compared to $28.70 million in the prior year period. At the same time, adjusted operating margin contracted 4 basis points in the quarter to 4.81 percent from 4.85 percent in the last year period.

"We've stated this is a reset year; however, I am highly encouraged with the steady progress we are making through the hard work of our teams. During the quarter, we saw strong results in Engineered Composites and experienced continued growth in our Asia-Pacific and Latin America segments related to improved product mix and strength in Performance Materials. Our European business saw a year-over-year improvement in operating income despite the impact of foreign currency, in part, helped by our recent business simplification efforts," said Joseph M. Gingo, chairman, president and chief executive officer. "While our U.S. and Canada region remains challenged by complex plant consolidation efforts, which had been complicated by the Lucent matter, I am confident that we have solid action plans in place to drive future profitability."

For financial year 2017, A. Schulman, Inc. projects revenue to be in the range of $2,500 million to $2,600 million. It forecasts diluted earnings per share to be in the range of $2.08 to $2.18 on adjusted basis for the same period.

The company has spent $23.90 million cash to meet investing activities during the first six months as against cash outgo of $19.52 million in the last year period. It has incurred net capital expenditure of $24.03 million on net basis during the first six months, up 23.08 percent or $4.50 million from year ago period.

The company has spent $9.67 million cash to carry out financing activities during the first six months as against cash outgo of $57.96 million in the last year period.

Cash and cash equivalents stood at $47.86 million as on Feb. 28, 2017, up 2.10 percent or $0.98 million from $46.88 million on Feb. 29, 2016.

Working capital declines
A. Schulman, Inc. has witnessed a decline in the working capital over the last year. It stood at $314.91 million as at Feb. 28, 2017, down 17.57 percent or $67.13 million from $382.04 million on Feb. 29, 2016. Current ratio was at 1.71 as on Feb. 28, 2017, down from 1.92 on Feb. 29, 2016.

Cash conversion cycle (CCC) has decreased to 31 days for the quarter from 64 days for the last year period. Days sales outstanding went up to 61 days for the quarter compared with 60 days for the same period last year.

Days inventory outstanding has decreased to 26 days for the quarter compared with 56 days for the previous year period. At the same time, days payable outstanding went up to 57 days for the quarter from 52 for the same period last year.