Brinker International, Inc. (EAT) has reported 27.38 percent fall in profit for the quarter ended Dec. 28, 2016. The company has earned $34.64 million, or $0.69 a share in the quarter, compared with $47.69 million, or $0.80 a share for the same period last year. Revenue during the quarter went down marginally by 2.23 percent to $771.04 million from $788.61 million in the previous year period. Gross margin for the quarter contracted 99 basis points over the previous year period to 17.60 percent. Total expenses were 92.02 percent of quarterly revenues, up from 90.41 percent for the same period last year. That has resulted in a contraction of 161 basis points in operating margin to 7.98 percent.
Operating income for the quarter was $61.53 million, compared with $75.62 million in the previous year period.
"We are not satisfied with our second quarter results. While we believe our initiatives can deliver share gains, our overall performance was hurt by a much weaker-than-expected casual dining category," said Wyman Roberts, chief executive officer and president. "We are taking actions to sharpen our focus on more impactful innovation and execution designed to create long-term value for our shareholders."
For financial year 2017, the company forecasts diluted earnings per share to be in the range of $3.05 to $3.15.
Operating cash flow declinesBrinker International, Inc. has generated cash of $141.14 million from operating activities during the first half, down 9.67 percent or $15.10 million, when compared with the last year period. The company has spent $57.03 million cash to meet investing activities during the first six months as against cash outgo of $155.02 million in the last year period. It has incurred net capital expenditure of $57.03 million on net basis during the first six months, up 15.35 percent or $7.59 million from year ago period.
The company has spent $81.49 million cash to carry out financing activities during the first six months as against cash inflow of $14.95 million in the last year period.
Cash and cash equivalents stood at $34.06 million as on Dec. 28, 2016, down 52.22 percent or $37.23 million from $71.29 million on Dec. 23, 2015.
Working capital remains negative
Working capital of Brinker International, Inc. was negative $245.54 million on Dec. 28, 2016 compared with negative $195.07 million on Dec. 23, 2015. Current ratio was at 0.48 as on Dec. 28, 2016, down from 0.57 on Dec. 23, 2015.
Days sales outstanding went down to 2 days for the quarter compared with 7 days for the same period last year.
Debt moves up
Brinker International, Inc. has witnessed an increase in total debt over the last one year. It stood at $1,420.03 million as on Dec. 28, 2016, up 22.41 percent or $259.93 million from $1,160.10 million on Dec. 23, 2015. Total debt was 94.79 percent of total assets as on Dec. 28, 2016, compared with 73.43 percent on Dec. 23, 2015. Interest coverage ratio deteriorated to 4.51 for the quarter from 9.56 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: [email protected]
