Dolby Laboratories, Inc. (DLB) has reported a 24.94 percent fall in profit for the quarter ended Mar. 31, 2017. The company has earned $50.59 million, or $0.49 a share in the quarter, compared with $67.40 million, or $0.66 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $65.10 million, or $0.63 a share compared with $83.50 million or $0.82 a share, a year ago.
Revenue during the quarter went down marginally by 2.50 percent to $267.47 million from $274.34 million in the previous year period. Gross margin for the quarter contracted 120 basis points over the previous year period to 89.91 percent. Total expenses were 76.34 percent of quarterly revenues, up from 69.99 percent for the same period last year. That has resulted in a contraction of 635 basis points in operating margin to 23.66 percent.
Operating income for the quarter was $63.28 million, compared with $82.33 million in the previous year period.
"We made great progress with our growth initiatives this quarter," said Kevin Yeaman, president and chief executive officer, Dolby Laboratories. "We now have more than 90 Dolby Cinema locations open, up from 20 a year ago. The first smartphone with Dolby Vision was launched by LG and we added two more partners for Dolby Voice, BlueJeans and West."
For the third-quarter 2017, Dolby Laboratories, Inc. projects revenue to be in the range of $290 million to $305 million. The company forecasts diluted earnings per share to be in the range of $0.61 to $0.67. On an adjusted basis, the company forecasts diluted earnings per share to be in the range of $0.75 to $0.81.
For financial year 2017, Dolby Laboratories, Inc. projects revenue to be in the range of $1,060 million to $1,100 million.
Operating cash flow remains almost stable
Dolby Laboratories, Inc. has generated cash of $155.35 million from operating activities during the first half, down 0.97 percent or $1.52 million, when compared with the last year period.
The company has spent $68.13 million cash to meet investing activities during the first six months as against cash outgo of $71.39 million in the last year period.
The company has spent $68.20 million cash to carry out financing activities during the first six months as against cash outgo of $97.10 million in the last year period.
Cash and cash equivalents stood at $532.51 million as on Mar. 31, 2017, up 2.17 percent or $11.31 million from $521.20 million on Apr. 01, 2016.
Working capital increases
Dolby Laboratories, Inc. has recorded an increase in the working capital over the last year. It stood at $658.62 million as at Mar. 31, 2017, up 12.05 percent or $70.81 million from $587.80 million on Apr. 01, 2016. Current ratio was at 4.09 as on Mar. 31, 2017, up from 3.96 on Apr. 01, 2016.
Cash conversion cycle (CCC) has decreased to 23 days for the quarter from 35 days for the last year period. Days sales outstanding went down to 30 days for the quarter compared with 32 days for the same period last year.
Days inventory outstanding has decreased to 30 days for the quarter compared with 59 days for the previous year period. At the same time, days payable outstanding went down to 38 days for the quarter from 56 for the same period last year.
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