Revenue during the quarter grew 5.88 percent to $221.09 million from $208.81 million in the previous year period. Gross margin for the quarter contracted 14 basis points over the previous year period to 37.79 percent. Total expenses were 91.71 percent of quarterly revenues, down from 92.95 percent for the same period last year. This has led to an improvement of 123 basis points in operating margin to 8.29 percent.

Operating income for the quarter was $18.32 million, compared with $14.73 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $41.62 million compared with $36.15 million in the prior year period. At the same time, adjusted EBITDA margin improved 151 basis points in the quarter to 18.82 percent from 17.31 percent in the last year period.

“We will continue to invest in innovative curriculum, technology and programs to transform the educational experience for all students we serve,” said Stuart Udell, chief executive officer. “With Middlebury Interactive Languages and its best-of-breed courses now part of K12, we are even better positioned with deep language literacy expertise to help schools, districts, and families prepare students for college and careers. Students can take up to six world languages, including Spanish, French, and Chinese, in an interactive online environment, and English Language Learners have access to new digital curriculum designed to help them close the achievement gap,” Udell added.

For the third-quarter, K12 projects revenue to be in the range of $210 million to $220 million. The company projects operating income to be in the range of $14 million to $17 million for the third-quarter. The company projects adjusted operating income to be in the range of $18 million to $21 million for the third-quarter.

The company has spent $33 million cash to meet investing activities during the first six months as against cash outgo of $25.82 million in the last year period.

The company has spent $9.08 million cash to carry out financing activities during the first six months as against cash outgo of $11.69 million in the last year period.

Cash and cash equivalents stood at $182.15 million as on Dec. 31, 2016, up 6.35 percent or $10.87 million from $171.28 million on Dec. 31, 2015.

Working capital declines
K12 Inc has witnessed a decline in the working capital over the last year. It stood at $334.41 million as at Dec. 31, 2016, down 5.35 percent or $18.91 million from $353.32 million on Dec. 31, 2015. Current ratio was at 3.67 as on Dec. 31, 2016, down from 4.04 on Dec. 31, 2015.

Cash conversion cycle (CCC) has decreased to 85 days for the quarter from 99 days for the last year period. Days sales outstanding went down to 100 days for the quarter compared with 108 days for the same period last year.

Days inventory outstanding has decreased to 6 days for the quarter compared with 12 days for the previous year period. At the same time, days payable outstanding was almost stable at 20 days for the quarter, when compared with the previous year period.