MKS Instruments, Inc. (MKSI) has reported a 270.44 percent jump in profit for the quarter ended Mar. 31, 2017. The company has earned $65.06 million, or $1.18 a share in the quarter, compared with $17.56 million, or $0.33 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $69.99 million, or $1.27 a share compared with $20.15 million or $0.38 a share, a year ago.
Revenue during the quarter surged 138 percent to $437.15 million from $183.68 million in the previous year period. Gross margin for the quarter expanded 460 basis points over the previous year period to 47.02 percent. Total expenses were 80.88 percent of quarterly revenues, down from 87.72 percent for the same period last year. This has led to an improvement of 684 basis points in operating margin to 19.12 percent.
Operating income for the quarter was $83.58 million, compared with $22.56 million in the previous year period.
However, the adjusted operating income for the quarter stood at $98.47 million compared to $26.74 million in the prior year period. At the same time, adjusted operating margin improved 797 basis points in the quarter to 22.52 percent from 14.56 percent in the last year period.
"We are very pleased with our strong start to 2017. We set a new record for quarterly revenue, continued to enhance our organizational strengths, and collaborated more closely and effectively with our customers," said Gerald Colella, chief executive officer and president. Mr. Colella added, "Our strategic objective to drive sustainable and profitable growth has allowed MKS to not only leverage technology inflection points within the semiconductor market, but also to further drive growth in a number of adjacent markets. In the first quarter, semiconductor revenue and sales to other advanced markets, on a pro-forma basis, increased 54% and 10% respectively from a year ago."
For the second-quarter, MKS Instruments, Inc. forecasts revenue to be in the range of $440 million to $480 million. It projects net income to be in the range of $117.30 million to $131.20 million. It expects adjusted net income to be in the range of $69.60 million to $83.10 million. It expects diluted earnings per share to be in the range of $2.12 to $2.37. It expects diluted earnings per share to be in the range of $1.26 to $1.50 on an adjusted basis for the same period.
Working capital declines
MKS Instruments, Inc. has witnessed a decline in the working capital over the last year. It stood at $791.12 million as at Mar. 31, 2017, down 8.14 percent or $70.07 million from $861.19 million on Mar. 31, 2016. Current ratio was at 4.43 as on Mar. 31, 2017, down from 9.79 on Mar. 31, 2016.
Cash conversion cycle (CCC) has decreased to 75 days for the quarter from 162 days for the last year period. Days sales outstanding went down to 38 days for the quarter compared with 53 days for the same period last year.
Days inventory outstanding has decreased to 55 days for the quarter compared with 131 days for the previous year period. At the same time, days payable outstanding went down to 18 days for the quarter from 22 for the same period last year.
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