Hub Group, Inc. (HUBG) has reported an 18.46 percent fall in profit for the quarter ended Dec. 31, 2016. The company has earned $18.24 million, or $0.55 a share in the quarter, compared with $22.37 million, or $0.63 a share for the same period last year.
Revenue during the quarter grew 9.92 percent to $978.56 million from $890.27 million in the previous year period. Gross margin for the quarter contracted 81 basis points over the previous year period to 12.31 percent. Total expenses were 96.85 percent of quarterly revenues, up from 96.03 percent for the same period last year. That has resulted in a contraction of 82 basis points in operating margin to 3.15 percent.
Operating income for the quarter was $30.84 million, compared with $35.34 million in the previous year period.
"The above market revenue increase is the result of our on-going focus on excellent customer service. The operating income decline was driven by our strategic investments in our people and technology. We believe these investments provide a solid foundation for the future," said Dave Yeager, Hub’s chairman and chief executive officer.
Operating cash flow drops significantly
Hub Group, Inc. has generated cash of $102.47 million from operating activities during the year, down 40.32 percent or $69.22 million, when compared with the last year. The company has spent $105.35 million cash to meet investing activities during the year as against cash outgo of $80.73 million in the last year. It has incurred net capital expenditure of $105.35 million on net basis during the year, up 30.49 percent or $24.62 million from year ago.
The company has spent $77.36 million cash to carry out financing activities during the year as against cash inflow of $7.15 million in the last year period.
Cash and cash equivalents stood at $127.40 million as on Dec. 31, 2016, down 38.67 percent or $80.34 million from $207.75 million on Dec. 31, 2015.
Working capital declines
Hub Group, Inc. has witnessed a decline in the working capital over the last year. It stood at $204.57 million as at Dec. 31, 2016, down 23.07 percent or $61.34 million from $265.91 million on Dec. 31, 2015. Current ratio was at 1.49 as on Dec. 31, 2016, down from 1.74 on Dec. 31, 2015.
Debt moves up
Hub Group, Inc. has witnessed an increase in total debt over the last one year. It stood at $173.96 million as on Dec. 31, 2016, up 16.59 percent or $24.75 million from $149.21 million on Dec. 31, 2015. Total debt was 12.79 percent of total assets as on Dec. 31, 2016, compared with 11.47 percent on Dec. 31, 2015. Debt to equity ratio was at 0.28 as on Dec. 31, 2016, up from 0.23 as on Dec. 31, 2015. Interest coverage ratio deteriorated to 31.79 for the quarter from 46.93 for the same period last year.
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