Chemed Corporation (CHE) has reported a 7.55 percent rise in profit for the quarter ended Dec. 31, 2016. The company has earned $32.19 million, or $1.94 a share in the quarter, compared with $29.93 million, or $1.72 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $34.86 million, or $2.10 a share compared with $34.19 million or $1.97 a share, a year ago.
Revenue during the quarter went up marginally by 1.23 percent to $403.48 million from $398.59 million in the previous year period. Gross margin for the quarter expanded 7 basis points over the previous year period to 30.83 percent. Total expenses were 86.83 percent of quarterly revenues, down from 87.67 percent for the same period last year. This has led to an improvement of 83 basis points in operating margin to 13.17 percent.
Operating income for the quarter was $53.12 million, compared with $49.16 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $66.59 million compared with $65.98 million in the prior year period. At the same time, adjusted EBITDA margin contracted 5 basis points in the quarter to 16.50 percent from 16.55 percent in the last year period.
For financial year 2017, the company forecasts diluted earnings per share to be in the range of $7.80 to $8 on adjusted basis.
Operating cash flow declines
Chemed Corporation has generated cash of $135.39 million from operating activities during the year, down 21.05 percent or $36.11 million, when compared with the last year.
The company has spent $39.86 million cash to meet investing activities during the year as against cash outgo of $50.32 million in the last year.
The company has spent $94.95 million cash to carry out financing activities during the year as against cash outgo of $120.59 million in the last year period.
Cash and cash equivalents stood at $15.31 million as on Dec. 31, 2016, up 3.96 percent or $0.58 million from $14.73 million on Dec. 31, 2015.
Working capital remains negative
Working capital of Chemed Corporation was negative $1.93 million on Dec. 31, 2016 compared with negative $20.53 million on Dec. 31, 2015. Current ratio was at 0.99 as on Dec. 31, 2016, up from 0.88 on Dec. 31, 2015.
Cash conversion cycle (CCC) has increased to 9 days for the quarter from 6 days for the last year period. Days sales outstanding went up to 15 days for the quarter compared with 12 days for the same period last year.
Days inventory outstanding was almost stable at 1 days for the quarter, when compared with the last year period. At the same time, days payable outstanding was almost stable at 7 days for the quarter, when compared with the previous year period.
Debt moves up
Chemed Corporation has witnessed an increase in total debt over the last one year. It stood at $108.75 million as on Dec. 31, 2016, up 19.18 percent or $17.50 million from $91.25 million on Dec. 31, 2015. Total debt was 12.36 percent of total assets as on Dec. 31, 2016, compared with 10.71 percent on Dec. 31, 2015. Debt to equity ratio was at 0.21 as on Dec. 31, 2016, up from 0.18 as on Dec. 31, 2015.
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