Jacobs Engineering Group Inc. (JEC) has reported a 23.34 percent fall in profit for the quarter ended Mar. 31, 2017. The company has earned $50.02 million, or $0.41 a share in the quarter, compared with $65.25 million, or $0.54 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $95.23 million, or $0.78 a share compared with $90.95 million or $0.75 a share, a year ago.
Revenue during the quarter dropped 17.23 percent to $2,302.57 million from $2,781.76 million in the previous year period. Gross margin for the quarter expanded 224 basis points over the previous year period to 18.21 percent. Total expenses were 97.04 percent of quarterly revenues, up from 96.88 percent for the same period last year. That has resulted in a contraction of 16 basis points in operating margin to 2.96 percent.
Operating income for the quarter was $68.17 million, compared with $86.78 million in the previous year period.
However, the adjusted operating income for the quarter stood at $140.40 million compared to $121.96 million in the prior year period. At the same time, adjusted operating margin improved 171 basis points in the quarter to 6.10 percent from 4.38 percent in the last year period.
Commenting on the results for the second quarter 2017, Steve Demetriou, Jacobs chairman and chief executive officer said, "We are excited about the benefits from the significant steps we have taken over the past two years to improve our operating performance and capabilities, resulting in our first year over year adjusted operating profit improvement in almost 3 years. While commodity oriented markets continue to be impacted by weak prices, our results give us further confidence in our ability to deliver on a more profitable growth track, as evidenced by the growth in our backlog, improved gross margins and lower SG&A costs."
Working capital declines
Jacobs Engineering Group Inc. has witnessed a decline in the working capital over the last year. It stood at $1,087.93 million as at Mar. 31, 2017, down 5.76 percent or $66.48 million from $1,154.41 million on Apr. 01, 2016. Current ratio was at 1.63 as on Mar. 31, 2017, up from 1.60 on Apr. 01, 2016.
Days sales outstanding went up to 89 days for the quarter compared with 79 days for the same period last year.
At the same time, days payable outstanding went up to 21 days for the quarter from 18 for the same period last year.
Debt comes down significantly
Jacobs Engineering Group Inc. has recorded a decline in total debt over the last one year. It stood at $337.87 million as on Mar. 31, 2017, down 36.58 percent or $194.86 million from $532.73 million on Apr. 01, 2016. Total debt was 4.77 percent of total assets as on Mar. 31, 2017, compared with 6.90 percent on Apr. 01, 2016. Debt to equity ratio was at 0.08 as on Mar. 31, 2017, down from 0.12 as on Apr. 01, 2016. Interest coverage ratio deteriorated to 18.16 for the quarter from 39.45 for the same period last year.
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