Ashland Global Holdings Inc (ASH) has reported a 5.75 percent rise in profit for the quarter ended Mar. 31, 2017. The company has earned $92 million, or $1.47 a share in the quarter, compared with $87 million, or $1.38 a share for the same period last year. Revenue during the quarter grew 5.85 percent to $1,320 million from $1,247 million in the previous year period. Gross margin for the quarter contracted 120 basis points over the previous year period to 32.80 percent. Total expenses were 87.12 percent of quarterly revenues, down from 88.21 percent for the same period last year. This has led to an improvement of 109 basis points in operating margin to 12.88 percent.
Operating income for the quarter was $170 million, compared with $147 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $247 million compared with $274 million in the prior year period. At the same time, adjusted EBITDA margin contracted 326 basis points in the quarter to 18.71 percent from 21.97 percent in the last year period.
“Ashland’s overall financial performance in the second quarter reflected progress in a number of key areas as we continue working toward our 2017 plan,” said William A. Wulfsohn, Ashland chairman and chief executive officer. “Within Ashland Specialty Ingredients, the team delivered volume growth of 4 percent and sales growth of 3 percent, with good gains in consumer end markets. In addition, the team maintained good cost discipline and initiated several price increases which partially offset the negative impact from higher-than-expected raw material costs and foreign currency during the quarter. Within Ashland Performance Materials, Composites volume grew 5 percent, while Intermediates and Solvents (I&S) volume rose 21 percent amid continued price recovery in butanediol. Meanwhile, the Valvoline team reported good gains in lubricant gallons and sales.”
For the third-quarter, Ashland Global Holdings Inc projects revenue to be in the range of $260 million to $280 million.
Operating cash flow drops significantly
Ashland Global Holdings Inc has generated cash of $41 million from operating activities during the first half, down 82.25 percent or $190 million, when compared with the last year period. The company has spent $141 million cash to meet investing activities during the first six months as against cash outgo of $124 million in the last year period. It has incurred net capital expenditure of $103 million on net basis during the first six months, up 3 percent or $3 million from year ago period.
The company has spent $475 million cash to carry out financing activities during the first six months as against cash outgo of $217 million in the last year period.
Cash and cash equivalents stood at $605 million as on Mar. 31, 2017, down 46.74 percent or $531 million from $1,136 million on Mar. 31, 2016.
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