CSP Inc. (CSPI) has reported a 14.91 percent fall in profit for the quarter ended Mar. 31, 2017. The company has earned $0.43 million, or $0.11 a share in the quarter, compared with $0.50 million, or $0.13 a share for the same period last year.
Revenue during the quarter dropped 6.72 percent to $25.32 million from $27.14 million in the previous year period. Gross margin for the quarter contracted 84 basis points over the previous year period to 22.50 percent. Total expenses were 97.54 percent of quarterly revenues, up from 96.76 percent for the same period last year. That has resulted in a contraction of 78 basis points in operating margin to 2.46 percent.
Operating income for the quarter was $0.62 million, compared with $0.88 million in the previous year period.
"We are pleased to say that the second quarter results continue to demonstrate positive progress on our growth strategy," said chief executive officer Victor Dellovo. "Cross-selling efforts between our Technology Solution geographies, as well as across High Performance Products and Technology Solutions continue to gain traction. Our managed services pipeline, in the U.S. and Europe, is growing, and we are taking actions to capitalize on the rapidly growing global security market. From a financial perspective, second-quarter sales were down 6.7%, primarily due to the timing of shipments at our U.S. business in the Technology Solutions division. However, year over year growth was achieved across our U.K. and Germany Technology Solutions businesses."
Working capital increases
CSP Inc. has recorded an increase in the working capital over the last year. It stood at $23.93 million as at Mar. 31, 2017, up 6.16 percent or $1.39 million from $22.54 million on Mar. 31, 2016. Current ratio was at 2.07 as on Mar. 31, 2017, down from 2.21 on Mar. 31, 2016.
Days sales outstanding went up to 76 days for the quarter compared with 69 days for the same period last year.
Days inventory outstanding has decreased to 15 days for the quarter compared with 24 days for the previous year period.
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