Addvantage Technologies Group (AEY) has reported an 805.06 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $0.22 million in the quarter, compared with $0.02 million for the same period last year.
Revenue during the quarter surged 46.62 percent to $12.10 million from $8.25 million in the previous year period. Gross margin for the quarter contracted 26 basis points over the previous year period to 33.26 percent. Total expenses were 96.47 percent of quarterly revenues, down from 98.83 percent for the same period last year. This has led to an improvement of 236 basis points in operating margin to 3.53 percent.
Operating income for the quarter was $0.43 million, compared with $0.10 million in the previous year period.
"We are continuing to execute on our growth strategy as we recognize organic and acquired sales growth in the first quarter of fiscal 2017. We have steadily built positive momentum in our business over the past several quarters, as the Cable TV market has shown solid demand for new and refurbished equipment. We are cautiously optimistic about the opportunity for future growth in our Company as we continue to implement our long-term strategy, which includes the integration of Triton Datacom into our consolidated results," commented David Humphrey, president and chief executive officer of ADDvantage Technologies.
Working capital declines
Addvantage Technologies Group has witnessed a decline in the working capital over the last year. It stood at $24.11 million as at Dec. 31, 2016, down 21.78 percent or $6.72 million from $30.83 million on Dec. 31, 2015. Current ratio was at 4.15 as on Dec. 31, 2016, down from 7.49 on Dec. 31, 2015.
Cash conversion cycle (CCC) has decreased to 135 days for the quarter from 406 days for the last year period. Days sales outstanding went down to 36 days for the quarter compared with 46 days for the same period last year.
Days inventory outstanding has decreased to 124 days for the quarter compared with 391 days for the previous year period. At the same time, days payable outstanding went down to 25 days for the quarter from 31 for the same period last year.
Debt increases substantially
Addvantage Technologies Group has witnessed an increase in total debt over the last one year. It stood at $7.91 million as on Dec. 31, 2016, up 57.50 percent or $2.89 million from $5.02 million on Dec. 31, 2015. Total debt was 13.97 percent of total assets as on Dec. 31, 2016, compared with 9.76 percent on Dec. 31, 2015. Debt to equity ratio was at 0.19 as on Dec. 31, 2016, up from 0.12 as on Dec. 31, 2015. Interest coverage ratio improved to 4.42 for the quarter from 1.43 for the same period last year.
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