The Michaels Companies, Inc (MIK) has reported 2.04 percent rise in profit for the quarter ended Apr. 29, 2017. The company has earned $72.21 million, or $0.38 a share in the quarter, compared with $70.76 million, or $0.34 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $72.21 million, or $0.38 a share compared with $75.54 million or $0.36 a share, a year ago. Revenue during the quarter went down marginally by 0.03 percent to $1,158.56 million from $1,158.88 million in the previous year period. Gross margin for the quarter expanded 26 basis points over the previous year period to 40.36 percent. Total expenses were 87.98 percent of quarterly revenues, up from 87.46 percent for the same period last year. That has resulted in a contraction of 52 basis points in operating margin to 12.02 percent.
Operating income for the quarter was $139.26 million, compared with $145.32 million in the previous year period.
However, the adjusted operating income for the quarter stood at $139.26 million compared to $153.05 million in the prior year period. At the same time, adjusted operating margin contracted 119 basis points in the quarter to 12.02 percent from 13.21 percent in the last year period.
“I am encouraged with the improving trend in customer transactions this quarter, especially given the headwinds we faced as we anniversaried last year’s coloring trend,” said Chuck Rubin, Chairman and Chief Executive Officer. “We continue to make progress on our 2017 and long term operational and strategic priorities, and we look forward to sharing more about our long-term goals at our upcoming analyst day.”
For the second-quarter 2017, The Michaels Companies, Inc expects operating income to be in the range of $75 million to $80 million and its diluted earnings per share to be in the range of $0.15 to $0.17.
For fiscal year 2017, The Michaels Companies, Inc expects revenue to grow in the range of 2.20 percent to 3.70 percent and its operating income to be in the range of $723 million to $756 million and diluted earnings per share to be in the range of $2.03 to $2.15.
Operating cash flow turns positive
The Michaels Companies, Inc has generated cash of $22.94 million from operating activities during the quarter as against cash outgo of $23.86 million in the last year period. The company has spent $15.69 million cash to meet investing activities during the quarter as against cash outgo of $159.26 million in the last year period.
The company has spent $108.20 million cash to carry out financing activities during the quarter as against cash outgo of $54.39 million in the last year period.
Cash and cash equivalents stood at $197.86 million as on Apr. 29, 2017, up 15.12 percent or $25.99 million from $171.87 million on Apr. 30, 2016.
Debt remains almost stable
The Michaels Companies, Inc has recorded a decline in total debt over the last one year. It stood at $2,742.73 million as on Apr. 29, 2017, down 0.80 percent or $22.23 million from $2,764.96 million on Apr. 30, 2016. Interest coverage ratio improved to 4.58 for the quarter from 4.51 for the same period last year.
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