Commercial Vehicle Group, Inc. (CVGI) has reported a 55.09 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $1.15 million, or $0.04 a share in the quarter, compared with $2.55 million, or $0.09 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $1.98 million, or $0.07 a share compared with $2.74 million or $0.10 a share, a year ago. Revenue during the quarter dropped 24.23 percent to $153.60 million from $202.73 million in the previous year period. Gross margin for the quarter contracted 144 basis points over the previous year period to 12.32 percent. Total expenses were 97.09 percent of quarterly revenues, up from 95.09 percent for the same period last year. That has resulted in a contraction of 200 basis points in operating margin to 2.91 percent.
Operating income for the quarter was $4.47 million, compared with $9.95 million in the previous year period.
However, the adjusted operating income for the quarter stood at $5.99 million compared to $10.29 million in the prior year period. At the same time, adjusted operating margin contracted 118 basis points in the quarter to 3.90 percent from 5.08 percent in the last year period.
Patrick Miller, president and chief executive officer, stated, "Our two largest end markets, North American heavy-duty truck and global construction equipment remain at depressed levels. Consequently, revenues in the third quarter were down 24 percent period-over-period. I continue to be pleased with the response of our operations and support teams to this challenging sales environment - our margins are outperforming historical sales conversions. Especially pleasing is the performance of the team leading our Global Construction and Agriculture Segment - GCA operating income improved $3 million in the quarter on lower period-over-period sales. This proactive response to the business cycle has and continues to position CVG with a favorable cost structure that is expected to contribute to earnings when the cycle turns up." Miller added, "The restructuring actions to improve capacity utilization and lower landed cost to our customers continue as planned and are on time as well as at or below the initial cost estimates. We believe this restructuring, when taken together with our corporate-wide cost reduction actions, our next generation product launches, and our dedication to high product quality and delivery standards is improving customer satisfaction and will contribute to improved earnings when our end markets rebound."
Working capital decreases marginally
Commercial Vehicle Group, Inc. has witnessed a decline in the working capital over the last year. It stood at $208.50 million as at Sep. 30, 2016, down 4.86 percent or $10.65 million from $219.15 million on Sep. 30, 2015. Current ratio was at 2.89 as on Sep. 30, 2016, up from 2.64 on Sep. 30, 2015. Cash conversion cycle (CCC) has decreased to 50 days for the quarter from 64 days for the last year period. Days sales outstanding went up to 78 days for the quarter compared with 68 days for the same period last year.
Days inventory outstanding has decreased to 23 days for the quarter compared with 42 days for the previous year period. At the same time, days payable outstanding went up to 51 days for the quarter from 46 for the same period last year.
Debt comes down
Commercial Vehicle Group, Inc. has recorded a decline in total debt over the last one year. It stood at $232.96 million as on Sep. 30, 2016, down 6.82 percent or $17.04 million from $250 million on Sep. 30, 2015. Commercial Vehicle Group has recorded a decline in long-term debt over the last one year. It stood at $232.96 million as on Sep. 30, 2016, down 6.82 percent or $17.04 million from $250 million on Sep. 30, 2015. Total debt was 53.14 percent of total assets as on Sep. 30, 2016, compared with 52.76 percent on Sep. 30, 2015. Debt to equity ratio was at 3.11 as on Sep. 30, 2016, down from 3.81 as on Sep. 30, 2015. Interest coverage ratio improved to 0.93 for the quarter from 1.93 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: editor@irisindia.net
