Granite Construction Incorporated (GVA) saw its loss widen to $23.79 million, or $0.60 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $10.44 million, or $0.26 a share.
Revenue during the quarter grew 6.59 percent to $468.40 million from $439.45 million in the previous year period. Gross margin for the quarter contracted 357 basis points over the previous year period to 5.36 percent. Operating margin for the quarter stood at negative 7.78 percent as compared to a negative 3.71 percent for the previous year period.
Operating loss for the quarter was $36.44 million, compared with an operating loss of $16.29 million in the previous year period.
Adjusted EBITDA for the quarter stood at negative $19.94 million compared to negative $0.42 million in the prior year second quarter. At the same time, adjusted EBITDA margin stood at negative 4.26 percent for the quarter compared to negative 0.09 percent in the last year period.
"Despite the loss in the first quarter, we maintain our strong growth expectations for 2017. Overall outlook and direction of our business is excellent, with market improvements being seen across our portfolio," said James H. Roberts, president and chief executive officer of Granite Construction Incorporated. "On April 6th, the California legislature approved SB 1, the Road Repair and Accountability Act of 2017, which commits to more than $52 billion of incremental investment in the state over the next decade. This combines with the nearly $190 billion of long-term local measures passed by voters in California and Washington State last November to signal a significant, positive shift in public infrastructure investment. Our vertically integrated teams in the West are well prepared to handle the growth, as these businesses are still operating well below capacity."
Operating cash flow turns positive
Granite Construction Incorporated has generated cash of $13.34 million from operating activities during the quarter as against cash outgo of $10.43 million in the last year period. The company has spent $20.16 million cash to meet investing activities during the quarter as against cash outgo of $34.02 million in the last year period. It has incurred net capital expenditure of $20.31 million on net basis during the quarter, down 14.63 percent or $3.48 million from year ago period.
The company has spent $13.01 million cash to carry out financing activities during the quarter as against cash outgo of $10.09 million in the last year period.
Cash and cash equivalents stood at $169.50 million as on Mar. 31, 2017, down 14.52 percent or $28.80 million from $198.30 million on Mar. 31, 2016.
Working capital increases
Granite Construction Incorporated has recorded an increase in the working capital over the last year. It stood at $526.36 million as at Mar. 31, 2017, up 6.70 percent or $33.05 million from $493.30 million on Mar. 31, 2016. Current ratio was at 2.05 as on Mar. 31, 2017, down from 2.05 on Mar. 31, 2016.
Cash conversion cycle (CCC) has decreased to 5 days for the quarter from 46 days for the last year period. Days sales outstanding went down to 33 days for the quarter compared with 67 days for the same period last year.
Days inventory outstanding has decreased to 6 days for the quarter compared with 13 days for the previous year period. At the same time, days payable outstanding was almost stable at 33 days for the quarter, when compared with the previous year period.
Debt comes down
Granite Construction Incorporated has recorded a decline in total debt over the last one year. It stood at $243.10 million as on Mar. 31, 2017, down 5.74 percent or $14.79 million from $257.89 million on Mar. 31, 2016. Total debt was 14.49 percent of total assets as on Mar. 31, 2017, compared with 16 percent on Mar. 31, 2016. Debt to equity ratio was at 0.27 as on Mar. 31, 2017, down from 0.30 as on Mar. 31, 2016.
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