Cross Country Healthcare Inc (CCRN) swung to a net loss for the quarter ended Mar. 31, 2017. The company has made a net loss of $2.01 million, or $ 0.08 a share in the quarter, against a net profit of $19.02 million, or $0.09 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $1.65 million, or $0.05 a share compared with $2.87 million or $0.09 a share, a year ago. Revenue during the quarter grew 5.59 percent to $207.57 million from $196.58 million in the previous year period. Gross margin for the quarter contracted 30 basis points over the previous year period to 25.67 percent. Total expenses were 98.43 percent of quarterly revenues, up from 97.37 percent for the same period last year. That has resulted in a contraction of 106 basis points in operating margin to 1.57 percent.
Operating income for the quarter was $3.26 million, compared with $5.16 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $6.45 million compared with $8.51 million in the prior year period. At the same time, adjusted EBITDA margin contracted 122 basis points in the quarter to 3.11 percent from 4.33 percent in the last year period.
“Revenue from new business wins is ramping slower than forecasted due to longer implementation cycles. With more than 30 new programs still scheduled for implementation, representing over $100 million of spend, we believe these opportunities will drive stronger growth as we get them up and running,” stated William J. Grubbs, chief executive officer. “The pipeline for new Managed Service Programs remains strong and we expect to have another record year of new business wins.”
For the second-quarter, Cross Country Healthcare expects revenue to be in the range of $207 million to $212 million. On an adjusted basis, the company projects diluted earnings per share to be in the range of $0.08 to $0.10 for the second-quarter.
Working capital increases sharply
Cross Country Healthcare Inc has recorded an increase in the working capital over the last year. It stood at $106.24 million as at Mar. 31, 2017, up 37.86 percent or $29.17 million from $77.06 million on Mar. 31, 2016. Current ratio was at 2.33 as on Mar. 31, 2017, up from 1.99 on Mar. 31, 2016. Days sales outstanding were almost stable at 68 days for the quarter, when compared with the last year period.
Debt comes down significantly
Cross Country Healthcare Inc has recorded a decline in total debt over the last one year. It stood at $36.17 million as on Mar. 31, 2017, down 49.28 percent or $35.15 million from $71.32 million on Mar. 31, 2016. Total debt was 9.82 percent of total assets as on Mar. 31, 2017, compared with 19.64 percent on Mar. 31, 2016. Debt to equity ratio was at 0.18 as on Mar. 31, 2017, down from 0.44 as on Mar. 31, 2016. Interest coverage ratio deteriorated to 2.67 for the quarter from 3.16 for the same period last year.
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