Ferrellgas Partners, L.P (FGP) saw its loss narrow to $43.07 million, or $0.44 a share for the quarter ended Oct. 31, 2016. In the previous year period, the company reported a loss of $79.79 million, or $0.79 a share.
Revenue during the quarter dropped 19.44 percent to $379.54 million from $471.15 million in the previous year period. Gross margin for the quarter expanded 207 basis points over the previous year period to 40.56 percent. Operating margin for the quarter stood at negative 2.41 percent as compared to a negative 10.08 percent for the previous year period.
Operating loss for the quarter was $9.14 million, compared with an operating loss of $47.50 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $29.02 million compared with $48.90 million in the prior year period. At the same time, adjusted EBITDA margin contracted 273 basis points in the quarter to 7.65 percent from 10.38 percent in the last year period.
“While unusually warm weather conditions ��" including temperatures during our first quarter that were 35% higher than normal ��" continued to negatively impact our propane revenue, we are taking aggressive actions to position Ferrellgas for long-term growth and profitability,” said James E. Ferrell, the Company’s interim president and chief executive officer. “This quarter’s results include a 9% reduction in operating expenses, reflecting our ongoing efforts to meaningfully reduce costs. We also remain focused on growing our customer base, and are very pleased with our success winning new customers and retaining existing customers during the quarter.”
Working capital remains negative
Working capital of Ferrellgas Partners, L.P was negative $123.10 million on Oct. 31, 2016 compared with negative $86.70 million on Oct. 31, 2015. Current ratio was at 0.70 as on Oct. 31, 2016, down from 0.80 on Oct. 31, 2015.
Cash conversion cycle (CCC) has decreased to 30 days for the quarter from 44 days for the last year period. Days sales outstanding went up to 42 days for the quarter compared with 37 days for the same period last year.
Days inventory outstanding has decreased to 20 days for the quarter compared with 31 days for the previous year period. At the same time, days payable outstanding went up to 32 days for the quarter from 23 for the same period last year.
Debt moves up
Ferrellgas Partners, L.P has witnessed an increase in total debt over the last one year. It stood at $2,136.04 million as on Oct. 31, 2016, up 7.52 percent or $149.47 million from $1,986.57 million on Oct. 31, 2015. Total debt was 128.12 percent of total assets as on Oct. 31, 2016, compared with 83.25 percent on Oct. 31, 2015.
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