Carters (CRI) has reported a 13.55 percent fall in profit for the quarter ended Apr. 01, 2017. The company has earned $46.66 million, or $0.95 a share in the quarter, compared with $53.98 million, or $1.04 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $47.60 million, or $0.97 a share compared with $54.60 million or $1.05 a share, a year ago.
Revenue during the quarter went up marginally by 1.20 percent to $732.76 million from $724.08 million in the previous year period. Gross margin for the quarter expanded 16 basis points over the previous year period to 43.10 percent. Total expenses were 89.28 percent of quarterly revenues, up from 87.16 percent for the same period last year. That has resulted in a contraction of 212 basis points in operating margin to 10.72 percent.
Operating income for the quarter was $78.57 million, compared with $93.01 million in the previous year period.
However, the adjusted operating income for the quarter stood at $80.10 million compared to $94 million in the prior year period. At the same time, adjusted operating margin contracted 205 basis points in the quarter to 10.93 percent from 12.98 percent in the last year period.
"We achieved our sales and earnings objectives in the first quarter," said Michael D. Casey, chairman and chief executive officer. "Stronger than planned demand in our wholesale and eCommerce businesses helped to offset the effects of delayed tax refunds to families with young children and a later Easter holiday. We have seen a meaningful improvement in sales trends in April, driven by Easter holiday shopping, and expect good growth in sales and earnings in the balance of the year."
For the second-quarter 2017, Carters projects revenue to grow in the range of 6 percent to 8 percent. On an adjusted basis, the company forecasts diluted earnings per share to be in the range of $0.65 to $0.70.
For the financial year 2017, Carters projects revenue to grow in the range of 4 percent to 6 percent.
Operating cash flow drops significantly Carters has generated cash of $84.18 million from operating activities during the quarter, down 34.38 percent or $ 44.10 million, when compared with the last year period.
The company has spent $161.70 million cash to meet investing activities during the quarter as against cash outgo of $25.55 million in the last year period.
The company has spent $67.52 million cash to carry out financing activities during the quarter as against cash outgo of $90.16 million in the last year period.
Cash and cash equivalents stood at $154.28 million as on Apr. 01, 2017, down 60.96 percent or $240.86 million from $395.14 million on Apr. 02, 2016.
Working capital drops significantly
Carters has witnessed a decline in the working capital over the last year. It stood at $616.80 million as at Apr. 01, 2017, down 26.57 percent or $223.16 million from $839.96 million on Apr. 02, 2016. Current ratio was at 3.74 as on Apr. 01, 2017, down from 5.35 on Apr. 02, 2016.
Cash conversion cycle (CCC) has decreased to 45 days for the quarter from 91 days for the last year period. Days sales outstanding were almost stable at 26 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 47 days for the quarter compared with 93 days for the previous year period. At the same time, days payable outstanding was almost stable at 28 days for the quarter, when compared with the previous year period.
Debt remains almost stable Total debt of Carters remained almost stable for the quarter at $581.62 million, when compared with the last year period. Long-term debt of Carters remained almost stable for the quarter at $581.62 million, when compared with the last year period. Total debt was 30.85 percent of total assets as on Apr. 01, 2017, compared with 30.34 percent on Apr. 02, 2016. Debt to equity ratio was at 0.75 as on Apr. 01, 2017, up from 0.68 as on Apr. 02, 2016. Interest coverage ratio deteriorated to 11.06 for the quarter from 13.80 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]
