Revenue during the quarter grew 9.47 percent to $218.50 million from $199.60 million in the previous year period. Gross margin for the quarter expanded 79 basis points over the previous year period to 32.36 percent. Total expenses were 83.07 percent of quarterly revenues, down from 87.73 percent for the same period last year. This has led to an improvement of 466 basis points in operating margin to 16.93 percent.

Operating income for the quarter was $37 million, compared with $24.50 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $50.20 million compared with $48.30 million in the prior year period. At the same time, adjusted EBITDA margin contracted 122 basis points in the quarter to 22.97 percent from 24.20 percent in the last year period.

“We’re off to a solid start to the year,” said Michael Wilson, Ingevity’s president and chief executive officer. “We delivered a significant increase in revenues by driving broad-based volume growth. This resulted in earnings which were in line with our expectations. When compared against a particularly strong previous year’s quarter while still part of WestRock, our adjusted EBITDA increased by approximately 4 percent. Our adjusted EBITDA margins of 23 percent were higher than in the full year 2016.”

Ingevity projects revenue to be in the range of $930 million to $950 million for financial year 2017.

The company has spent $16.30 million cash to meet investing activities during the quarter as against cash outgo of $11.30 million in the last year period.

Cash flow from financing activities was $10 million for the quarter as against cash outgo of $1.20 million in the last year period.

Cash and cash equivalents stood at $29.70 million as on Mar. 31, 2017, up 30.84 percent or $7 million from $22.70 million on Mar. 31, 2016.

Working capital declines
Ingevity Corporation has witnessed a decline in the working capital over the last year. It stood at $195.20 million as at Mar. 31, 2017, down 6.38 percent or $13.30 million from $208.50 million on Mar. 31, 2016. Current ratio was at 2.53 as on Mar. 31, 2017, down from 3.03 on Mar. 31, 2016.

Cash conversion cycle (CCC) has decreased to 48 days for the quarter from 58 days for the last year period. Days sales outstanding were almost stable at 22 days for the quarter, when compared with the last year period.

Days inventory outstanding has decreased to 49 days for the quarter compared with 57 days for the previous year period. At the same time, days payable outstanding went up to 23 days for the quarter from 21 for the same period last year.