Broadridge Financial Solutions, Inc. (BR) has reported a 0.60 percent rise in profit for the quarter ended Sep. 30, 2016. The company has earned $33.70 million, or $0.28 a share in the quarter, compared with $33.50 million, or $0.28 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $43.90 million, or $0.36 a share compared with $39.60 million or $0.33 a share, a year ago.

Revenue during the quarter surged 50.55 percent to $895.30 million from $594.70 million in the previous year period. Gross margin for the quarter contracted 643 basis points over the previous year period to 19.81 percent. Total expenses were 92.63 percent of quarterly revenues, up from 90.06 percent for the same period last year. That has resulted in a contraction of 257 basis points in operating margin to 7.37 percent.

Operating income for the quarter was $66 million, compared with $59.10 million in the previous year period.

However, the adjusted operating income for the quarter stood at $81.60 million compared to $68.40 million in the prior year period. At the same time, adjusted operating margin contracted 239 basis points in the quarter to 9.11 percent from 11.50 percent in the last year period.

"Broadridge delivered a solid first quarter," said Richard J. Daly, Broadridge's president and chief executive officer. "We reported strong revenue growth, largely driven by the acquisition of NACC, and continued strong momentum in Closed sales. We also took steps to strengthen our leadership position over the medium- and long-term by investing in blockchain technology for our proxy business and by executing on the digital strategy for our Investor Communication Solutions segment." "These efforts, together with other ongoing product initiatives and our strong sales pipeline, give Broadridge multiple paths to drive growth. We are on track to achieve our three year financial objectives and our fiscal 2017 guidance for recurring fee revenue growth of 29% to 31%, Adjusted EPS growth of 12% to 17%, and Closed sales in the range of $140 million to $180 million," Mr. Daly added.

For fiscal year 2017, Broadridge Financial Solutions, Inc. projects revenue to be in the range of $140 million to $180 million. The company projects operating income to grow at 13.60 percent and projects adjusted operating income to grow at 15 percent. It forecasts diluted earnings per share to be in the range of $0.09 to $0.14 and forecasts diluted earnings per share to be in the range of $0.12 to $0.17 on adjusted basis.

The company has spent $508.40 million cash to meet investing activities during the quarter as against cash outgo of $18.10 million in the last year period.

Cash flow from financing activities was $96.10 million for the quarter, up 601.46 percent or $82.40 million, when compared with the last year period.

Cash and cash equivalents stood at $227.40 million as on Sep. 30, 2016, down 20.57 percent or $58.90 million from $286.30 million on Sep. 30, 2015.

Working capital drops significantly

Broadridge Financial Solutions, Inc. has witnessed a decline in the working capital over the last year. It stood at $244 million as at Sep. 30, 2016, down 36.21 percent or $138.50 million from $382.50 million on Sep. 30, 2015. Current ratio was at 1.38 as on Sep. 30, 2016, down from 1.93 on Sep. 30, 2015.

Days sales outstanding went down to 48 days for the quarter compared with 66 days for the same period last year.

At the same time, days payable outstanding went down to 16 days for the quarter from 24 for the same period last year.