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Computer Sciences Corporation (CSC) has reported 38 percent plunge in profit for the quarter ended Dec. 30, 2016. The company has earned $31 million, or $0.21 a share in the quarter, compared with $50 million, or $0.35 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $117 million, or $0.81 a share compared with $131 million or $0.73 a share, a year ago.
Revenue during the quarter grew 9.54 percent to $1,917 million from $1,750 million in the previous year period. Gross margin for the quarter contracted 78 basis points over the previous year period to 29.73 percent. Total expenses were 96.09 percent of quarterly revenues, up from 94.11 percent for the same period last year. That has resulted in a contraction of 197 basis points in operating margin to 3.91 percent.
Operating income for the quarter was $75 million, compared with $103 million in the previous year period.
"CSC continued to execute on our strategic roadmap in the third quarter, in which CSC delivered revenue growth, year-over-year and sequential margin improvement, and record adjusted free cash flow," said Mike Lawrie, chairman, president and chief executive officer. "Revenue was up nearly 14 percent in constant currency driven by growth in next generation and Business Process Services offerings, as well as the contributions of our recent acquisitions. In addition, we remain on track to complete our proposed merger with the Enterprise Services business of Hewlett Packard Enterprise on or about April 1."
Operating cash flow improvesComputer Sciences Corporation has generated cash of $805 million from operating activities during the nine month period, up 8.49 percent or $63 million, when compared with the last year period. The company has spent $825 million cash to meet investing activities during the nine month period as against cash outgo of $730 million in the last year period.
Cash flow from financing activities was $72 million for the nine month period as against cash outgo of $236 million in the last year period.
Cash and cash equivalents stood at $1,111 million as on Dec. 30, 2016, down 39.29 percent or $719 million from $1,830 million on Jan. 01, 2016.
Working capital drops significantly
Computer Sciences Corporation has witnessed a decline in the working capital over the last year. It stood at $392 million as at Dec. 30, 2016, down 69.25 percent or $883 million from $1,275 million on Jan. 01, 2016. Current ratio was at 1.15 as on Dec. 30, 2016, down from 1.49 on Jan. 01, 2016.
Days sales outstanding went down to 89 days for the quarter compared with 99 days for the same period last year.
At the same time, days payable outstanding went up to 27 days for the quarter from 24 for the same period last year.
Debt moves upComputer Sciences Corporation has witnessed an increase in total debt over the last one year. It stood at $2,923 million as on Dec. 30, 2016, up 9.52 percent or $254 million from $2,669 million on Jan. 01, 2016. Total debt was 35.21 percent of total assets as on Dec. 30, 2016, compared with 33.41 percent on Jan. 01, 2016. Debt to equity ratio was at 1.33 as on Dec. 30, 2016, up from 1.20 as on Jan. 01, 2016. Interest coverage ratio deteriorated to 2.27 for the quarter from 3.12 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
