EACO Corporation (EACO) has reported an 18.35 percent rise in profit for the quarter ended Aug. 31, 2016. The company has earned $1.24 million, or $0.25 a share in the quarter, compared with $1.05 million, or $0.21 a share for the same period last year.
Revenue during the quarter grew 11.60 percent to $39.79 million from $35.65 million in the previous year period. Gross margin for the quarter expanded 76 basis points over the previous year period to 29.49 percent. Total expenses were 94.64 percent of quarterly revenues, down from 96.75 percent for the same period last year. This has led to an improvement of 210 basis points in operating margin to 5.36 percent.
Operating income for the quarter was $2.13 million, compared with $1.16 million in the previous year period.
Operating cash flow turns negative
EACO Corporation has spent $1.10 million cash to meet operating activities during the year as against cash inflow of $5.57 million in the last year.
The company has spent $0.82 million cash to meet investing activities during the year as against cash inflow of $0.02 million in the last year.
Cash flow from financing activities was $1.66 million for the year as against cash outgo of $3.60 million in the last year period.
Cash and cash equivalents stood at $4.88 million as on Aug. 31, 2016, down 7.42 percent or $0.39 million from $5.27 million on Aug. 31, 2015.
Working capital increases
EACO Corporation has recorded an increase in the working capital over the last year. It stood at $28.56 million as at Aug. 31, 2016, up 17.21 percent or $4.19 million from $24.36 million on Aug. 31, 2015. Current ratio was at 2.45 as on Aug. 31, 2016, down from 2.57 on Aug. 31, 2015.
Cash conversion cycle (CCC) has increased to 36 days for the quarter from 33 days for the last year period. Days sales outstanding went up to 22 days for the quarter compared with 20 days for the same period last year.
Days inventory outstanding has increased to 35 days for the quarter compared with 30 days for the previous year period. At the same time, days payable outstanding went up to 21 days for the quarter from 17 for the same period last year.
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