Intuit Inc. (INTU) has reported a 6.04 percent fall in profit for the quarter ended Apr. 30, 2017. The company has earned $964 million, or $3.70 a share in the quarter, compared with $1,026 million, or $3.94 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $1,015 million, or $3.90 a share compared with $893 million or $3.43 a share, a year ago. Revenue during the quarter grew 10.29 percent to $2,541 million from $2,304 million in the previous year period. Gross margin for the quarter contracted 5 basis points over the previous year period to 90.79 percent. Total expenses were 43.17 percent of quarterly revenues, down from 44.23 percent for the same period last year. This has led to an improvement of 106 basis points in operating margin to 56.83 percent.
Operating income for the quarter was $1,444 million, compared with $1,285 million in the previous year period.
However, the adjusted operating income for the quarter stood at $1,519 million compared to $1,359 million in the prior year period. At the same time, adjusted operating margin improved 80 basis points in the quarter to 59.78 percent from 58.98 percent in the last year period.
"This was another strong quarter for Intuit, with a hard-fought tax season delivering the revenue we promised along with continued momentum in our QuickBooks franchise," said Brad Smith, Intuit's chairman and chief executive officer. "Overall, we successfully delivered strong financial results. We entered the tax season with a clear plan to extend our lead in the do-it-yourself category and begin transforming the assisted category as well, embracing the power of the Intuit ecosystem. In small business, QuickBooks subscriber growth continued, driven by improvements across our platform for self-employed, small business and accountants,."
For financial year 2017, Intuit Inc. expects revenue to be in the range of $5,130 million to $5,150 million. The company expects adjusted revenue to be in the range of $5,130 million to $5,150 million. The company expects operating income to be in the range of $1,360 million to $1,380 million. The company expects adjusted operating income to be in the range of $1,705 million to $1,725 million. The company projects diluted earnings per share to be in the range of $3.55 to $3.57. The company projects diluted earnings per share to be in the range of $4.38 to $4.40 on adjusted basis.
For the fourth-quarter 2017, Intuit Inc. expects revenue to be in the range of $795 million to $815 million. The company expects adjusted revenue to be in the range of $795 million to $815 million. The company expects operating loss to be in the range of $45 million to $25 million. The company expects adjusted operating income to be in the range of $50 million to $70 million. The company projects diluted loss per share to be in the range of $0.03 to $0.01. On an adjusted basis, the company projects diluted earnings per share to be in the range of $0.16 to $0.18.
Operating cash flow improves
Intuit Inc. has generated cash of $1,889 million from operating activities during the nine month period, up 8.50 percent or $148 million, when compared with the last year period. The company has spent $22 million cash to meet investing activities during the nine month period as against cash inflow of $578 million in the last year period
The company has spent $1,149 million cash to carry out financing activities during the nine month period as against cash outgo of $1,844 million in the last year period.
Cash and cash equivalents stood at $1,350 million as on Apr. 30, 2017, up 4.73 percent or $61 million from $1,289 million on Apr. 30, 2016.
Working capital remains negative
Working capital of Intuit Inc. was negative $239 million on Apr. 30, 2017 compared with negative $554 million on Apr. 30, 2016. Current ratio was at 0.90 as on Apr. 30, 2017, up from 0.81 on Apr. 30, 2016.
Days sales outstanding went down to 15 days for the quarter compared with 16 days for the same period last year.
At the same time, days payable outstanding went down to 106 days for the quarter from 119 for the same period last year.
Debt comes down significantly
Intuit Inc. has recorded a decline in total debt over the last one year. It stood at $500 million as on Apr. 30, 2017, down 50 percent or $500 million from $1,000 million on Apr. 30, 2016. Total debt was 10.06 percent of total assets as on Apr. 30, 2017, compared with 20.24 percent on Apr. 30, 2016. Debt to equity ratio was at 0.29 as on Apr. 30, 2017, down from 0.80 as on Apr. 30, 2016. Interest coverage ratio improved to 180.50 for the quarter from 128.50 for the same period last year.
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