Douglas Dynamics, Inc. (PLOW) has reported a 33.34 percent plunge in profit for the quarter ended Dec. 31, 2016. The company has earned $9.96 million, or $0.44 a share in the quarter, compared with $14.94 million, or $0.66 a share for the same period last year.

Revenue during the quarter grew 9.54 percent to $130.14 million from $118.81 million in the previous year period. Gross margin for the quarter contracted 42 basis points over the previous year period to 32.02 percent. Total expenses were 82.59 percent of quarterly revenues, up from 79.90 percent for the same period last year. That has resulted in a contraction of 269 basis points in operating margin to 17.41 percent.

Operating income for the quarter was $22.66 million, compared with $23.88 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $27.43 million compared with $27.81 million in the prior year period. At the same time, adjusted EBITDA margin contracted 233 basis points in the quarter to 21.07 percent from 23.40 percent in the last year period.

James L. Janik, chairman, president and chief executive officer commented, "Thanks to the addition of the Work Truck Solutions segment in July and its performance for the remainder of the year, we produced record revenue and gross profit once again in 2016. Overall, it was a very positive year for our Company and our results for the fourth quarter were in line with our expectations, especially given this was the second winter in a row to start off with very little snowfall across our core markets before December. There is no question that the lower than average snowfall over the past two winters negatively impacted our business in 2016. However, several other factors including the favorable defense of our intellectual property, ongoing positive light truck sales, and the successful acquisition of the Work Truck Solutions segment had a positive impact on our results."

For fiscal year 2017, Douglas Dynamics, Inc. forecasts revenue to be in the range of $470 million to $530 million. The company expects diluted earnings per share to be in the range of $1.20 to $1.80.

The company has spent $191.17 million cash to meet investing activities during the year as against cash outgo of $21.83 million in the last year.

Cash flow from financing activities was $103.02 million for the year as against cash outgo of $21.99 million in the last year period.

Cash and cash equivalents stood at $18.61 million as on Dec. 31, 2016, down 49.49 percent or $18.24 million from $36.84 million on Dec. 31, 2015.

Working capital increases marginally

Douglas Dynamics, Inc. has recorded an increase in the working capital over the last year. It stood at $130.77 million as at Dec. 31, 2016, up 2.56 percent or $3.26 million from $127.51 million on Dec. 31, 2015. Current ratio was at 3.54 as on Dec. 31, 2016, down from 4.06 on Dec. 31, 2015.

Cash conversion cycle (CCC) has increased to 58 days for the quarter from 49 days for the last year period. Days sales outstanding were almost stable at 28 days for the quarter, when compared with the last year period.

Days inventory outstanding has increased to 39 days for the quarter compared with 30 days for the previous year period. At the same time, days payable outstanding was almost stable at 9 days for the quarter, when compared with the previous year period.