Fabrinet (FN) has reported an 1,320.21 percent jump in profit for the quarter ended Sep. 30, 2016. The company has earned $22.77 million, or $0.61 a share in the quarter, compared with $1.60 million, or $0.04 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $29.72 million, or $0.80 a share compared with $16.21 million or $0.45 a share, a year ago. Revenue during the quarter surged 53.42 percent to $332.04 million from $216.43 million in the previous year period. Gross margin for the quarter contracted 9 basis points over the previous year period to 11.93 percent. Total expenses were 92.84 percent of quarterly revenues, down from 93.88 percent for the same period last year. This has led to an improvement of 104 basis points in operating margin to 7.16 percent.
Operating income for the quarter was $23.78 million, compared with $13.25 million in the previous year period.
Tom Mitchell, chief executive officer of Fabrinet, said "We are off to a strong start in fiscal 2017 with first quarter revenue that exceeded our expectations and grew more than 50% from a year ago. We are benefiting from positive trends in the optical industry, including increasing activity from new and existing customer programs. We believe we are in a strong position to serve industry demand with new capacity from the first building at our new campus in Chonburi, Thailand, and our growing new product introduction (NPI) operation in Santa Clara. Our recent acquisition of Exception EMS, U.K. extends our NPI capabilities while diversifying our customer base. With continued momentum, we are optimistic we can again deliver strong growth in the second quarter, as reflected in our business outlook."
For the second-quarter 2017, Fabrinet expects revenue to be in the range of $332 million to $336 million. The company projects diluted earnings per share to be in the range of $0.65 to $0.67. On an adjusted basis, the company projects diluted earnings per share to be in the range of $0.78 to $0.80.
Operating cash flow turns negative
Fabrinet has spent $1 million cash to meet operating activities during the quarter as against cash inflow of $4.54 million in the last year period. The company has spent $46.65 million cash to meet investing activities during the quarter as against cash outgo of $20.40 million in the last year period. It has incurred capital expenditure of $27.16 million on net basis during the quarter, up 219.84 percent or $18.67 million from year ago period.
Cash flow from financing activities was $10.44 million for the quarter as against cash outgo of $1.18 million in the last year period.
Cash and cash equivalents stood at $105.86 million as on Sep. 30, 2016, up 10.89 percent or $10.39 million from $95.46 million on Sep. 25, 2015.
Working capital increases
Fabrinet has recorded an increase in the working capital over the last year. It stood at $411.21 million as at Sep. 30, 2016, up 19.77 percent or $67.87 million from $343.34 million on Sep. 25, 2015. Current ratio was at 2.53 as on Sep. 30, 2016, down from 2.78 on Sep. 25, 2015.
Cash conversion cycle (CCC) has decreased to 36 days for the quarter from 67 days for the last year period. Days sales outstanding went down to 51 days for the quarter compared with 58 days for the same period last year.
Days inventory outstanding has decreased to 34 days for the quarter compared with 65 days for the previous year period. At the same time, days payable outstanding went down to 49 days for the quarter from 56 for the same period last year.
Debt increases substantially
Fabrinet has witnessed an increase in total debt over the last one year. It stood at $71.95 million as on Sep. 30, 2016, up 84.49 percent or $32.95 million from $39 million on Sep. 25, 2015. Total debt was 7.98 percent of total assets as on Sep. 30, 2016, compared with 5.67 percent on Sep. 25, 2015. Debt to equity ratio was at 0.12 as on Sep. 30, 2016, up from 0.08 as on Sep. 25, 2015. Interest coverage ratio deteriorated to 17.98 for the quarter from 32.95 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: [email protected]
