AgroFresh Solutions, Inc. (AGFS) saw its loss narrow to $12.03 million, or $0.24 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $25.14 million, or $0.51 a share. Revenue during the quarter grew 15.20 percent to $32.73 million from $28.41 million in the previous year period. Gross margin for the quarter expanded 6600 basis points over the previous year period to 82.16 percent. Operating margin for the quarter stood at negative 10.68 percent as compared to a negative 92.58 percent for the previous year period.
Operating loss for the quarter was $3.50 million, compared with an operating loss of $26.30 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $10.62 million compared with $3.92 million in the prior year period. At the same time, adjusted EBITDA margin improved 1865 basis points in the quarter to 32.46 percent from 13.81 percent in the last year period.
Jordi Ferre, Chief Executive Officer, commented, "First quarter results reflect the health of our business and give us confidence that our new operations focus and enhanced financial discipline are yielding results. We grew revenues for the second consecutive quarter, with growth of 15 percent in the first quarter compared to the prior year period."
Operating cash flow declines
AgroFresh Solutions, Inc. has generated cash of $8.84 million from operating activities during the quarter, down 11.20 percent or $ 1.11 million, when compared with the last year period. The company has spent $1.36 million cash to meet investing activities during the quarter as against cash outgo of $0.84 million in the last year period.
The company has spent $1.06 million cash to carry out financing activities during the quarter as against cash outgo of $2.55 million in the last year period.
Cash and cash equivalents stood at $84.86 million as on Mar. 31, 2017, up 30.64 percent or $19.90 million from $64.96 million on Mar. 31, 2016.
Working capital increases
AgroFresh Solutions, Inc. has recorded an increase in the working capital over the last year. It stood at $85.22 million as at Mar. 31, 2017, up 12.03 percent or $9.15 million from $76.07 million on Mar. 31, 2016. Current ratio was at 2.01 as on Mar. 31, 2017, up from 1.89 on Mar. 31, 2016.
Cash conversion cycle (CCC) has decreased to 115 days for the quarter from 284 days for the last year period. Days sales outstanding went down to 174 days for the quarter compared with 215 days for the same period last year.
Days inventory outstanding has decreased to 125 days for the quarter compared with 130 days for the previous year period. At the same time, days payable outstanding went up to 184 days for the quarter from 61 for the same period last year.
Debt remains almost stable
AgroFresh Solutions, Inc. has recorded a decline in total debt over the last one year. It stood at $407.68 million as on Mar. 31, 2017, down 0.55 percent or $2.27 million from $409.95 million on Mar. 31, 2016. Total debt was 42.69 percent of total assets as on Mar. 31, 2017, compared with 37.95 percent on Mar. 31, 2016. Debt to equity ratio was at 1.27 as on Mar. 31, 2017, up from 0.98 as on Mar. 31, 2016.
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