Affinion Group Holdings, Inc. (AFGR) has reported an 178.57 percent jump in profit for the quarter ended Mar. 31, 2017. The company has earned $7.80 million, or $0.85 a share in the quarter, compared with $2.80 million, or $0.30 a share for the same period last year.
Revenue during the quarter dropped 5.41 percent to $241.10 million from $254.90 million in the previous year period. Gross margin for the quarter contracted 303 basis points over the previous year period to 62.92 percent. Total expenses were 84.20 percent of quarterly revenues, down from 86.82 percent for the same period last year. This has led to an improvement of 262 basis points in operating margin to 15.80 percent.
Operating income for the quarter was $38.10 million, compared with $33.60 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $59.90 million compared with $59.50 million in the prior year period. At the same time, adjusted EBITDA margin improved 150 basis points in the quarter to 24.84 percent from 23.34 percent in the last year period.
"Affinion is off to a strong start in 2017," said Todd Siegel, the Company's chief executive officer. "Our core businesses continue to perform well, building on the positive momentum from last year. In particular, we are pleased with the results in our Global Loyalty segment with over 40% revenue growth, driven by our industry leading solutions with existing clients as well as our new client launches during the first quarter." "In addition, we recently closed on a transaction that extends our debt maturities to 2022," continued Siegel. "The transaction provides the Company with sufficient runway to continue to invest in and capitalize on growth opportunities across our core businesses. For the remainder of 2017, we will continue to focus on maintaining and enhancing our broad range of content offerings, service capabilities and technology platforms."
Operating cash flow turns positive
Affinion Group Holdings, Inc. has generated cash of $9.50 million from operating activities during the quarter as against cash outgo of $3.40 million in the last year period. The company has spent $10.50 million cash to meet investing activities during the quarter as against cash outgo of $5.90 million in the last year period.
The company has spent $1.90 million cash to carry out financing activities during the quarter as against cash outgo of $2 million in the last year period.
Cash and cash equivalents stood at $35.10 million as on Mar. 31, 2017, down 20.95 percent or $9.30 million from $44.40 million on Mar. 31, 2016.
Working capital remains negative
Working capital of Affinion Group Holdings, Inc. was negative $68.50 million on Mar. 31, 2017 compared with negative $84.80 million on Mar. 31, 2016. Current ratio was at 0.84 as on Mar. 31, 2017, up from 0.79 on Mar. 31, 2016.
Days sales outstanding went up to 50 days for the quarter compared with 43 days for the same period last year.
Debt comes down marginally
Affinion Group Holdings, Inc. has recorded a decline in total debt over the last one year. It stood at $1,854.80 million as on Mar. 31, 2017, down 1.64 percent or $31 million from $1,885.80 million on Mar. 31, 2016. Total debt was 241.60 percent of total assets as on Mar. 31, 2017, compared with 241.21 percent on Mar. 31, 2016. Interest coverage ratio improved to 1.39 for the quarter from 1.21 for the same period last year.
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