Financial Engines (FNGN) has reported 15.69 percent fall in profit for the quarter ended Sep. 30, 2016. The company has earned $7.15 million, or $0.11 a share in the quarter, compared with $8.48 million, or $0.16 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $19.42 million, or $0.31 a share compared with $12.48 million or $0.24 a share, a year ago.
Revenue during the quarter surged 42.65 percent to $112.42 million from $78.81 million in the previous year period. Gross margin for the quarter contracted 287 basis points over the previous year period to 55.32 percent. Total expenses were 89.72 percent of quarterly revenues, up from 82.13 percent for the same period last year. That has resulted in a contraction of 758 basis points in operating margin to 10.28 percent.
Operating income for the quarter was $11.56 million, compared with $14.08 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $36.32 million compared with $25.10 million in the prior year period. At the same time, adjusted EBITDA margin improved 47 basis points in the quarter to 32.31 percent from 31.85 percent in the last year period.
"Financial Engines is in a strong position and focused on helping millions of everyday Americans achieve their financial goals. The acquisition of The Mutual Fund Store earlier this year enables us to accelerate this effort by bringing a broader product offering to our clients,"said Larry Raffone, president and chief executive officer of Financial Engines. "By delivering personalized comprehensive financial services that historically only affluent investors could access, we are fulfilling our mission to serve those that need help the most while continuing to grow as a company."
For fiscal year 2016, Financial Engines expects revenue to be in the range of $421 million to $423 million. It projects net income to be $29 million.
Operating cash flow falls marginallyFinancial Engines has generated cash of $49.31 million from operating activities during the nine month period, down 4.02 percent or $2.07 million, when compared with the last year period. The company has spent $233.27 million cash to meet investing activities during the nine month period as against cash outgo of $32.18 million in the last year period.
The company has spent $2.45 million cash to carry out financing activities during the nine month period as against cash outgo of $23.24 million in the last year period.
Cash and cash equivalents stood at $118.81 million as on Sep. 30, 2016, down 3.04 percent or $3.72 million from $122.53 million on Sep. 30, 2015.
Working capital drops significantly
Financial Engines has witnessed a decline in the working capital over the last year. It stood at $159.33 million as at Sep. 30, 2016, down 56.93 percent or $210.58 million from $369.91 million on Sep. 30, 2015. Current ratio was at 3.42 as on Sep. 30, 2016, down from 8.53 on Sep. 30, 2015.
Days sales outstanding went down to 68 days for the quarter compared with 83 days for the same period last year.
At the same time, days payable outstanding went down to 50 days for the quarter from 69 for the same period last year.
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