Model N Inc. (MODN) saw its loss widen to $12.49 million, or $0.44 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $8.91 million, or $0.33 a share. On the other hand, adjusted net loss for the quarter widened to $7.01 million, or $0.25 a share from a loss of $5.65 million or $0.21 a share, a year ago. Revenue during the quarter grew 27.62 percent to $33.26 million from $26.06 million in the previous year period. Gross margin for the quarter expanded 488 basis points over the previous year period to 51.77 percent. Operating margin for the quarter stood at negative 45.08 percent as compared to a negative 34.18 percent for the previous year period.
Operating loss for the quarter was $14.99 million, compared with an operating loss of $8.91 million in the previous year period.
However, the adjusted operating loss for the quarter stood at $5.35 million compared to operating loss of $5.68 million in prior year period.
"We are pleased with both our strategic progress and our execution during the second quarter. We closed the Revitas acquisition on January 5, 2017, delivered strong performance as a combined company, and accelerated the transition to SaaS and recurring revenues with record percentage of SaaS and maintenance revenue," said Zack Rinat, Founder, Executive Chairman and Chief Executive Officer of Model N. "Our market momentum is further validated by our record attendance at our annual customer event. We are committed to delivering value for both our customers and shareholders and accelerating our growth and path towards cash flow generation."
For financial year 2017, Model N forecasts revenue to be in the range of $129.40 million to $130 million for fiscal year 2017. The company forecasts adjusted operating loss to be in the range of $14.50 million to $14 million. It expects diluted loss per share to be in the range of $0.68 to $0.66 on adjusted basis.
For the third-quarter, Model N forecasts revenue to be in the range of $33.50 million to $33.80 million. The company forecasts adjusted operating loss to be in the range of $3.50 million to $3 million. On an adjusted basis, the company expects diluted loss per share to be in the range of $0.19 to $0.17.
Operating cash flow remains negative
Model N has spent $13.61 million cash to meet operating activities during the first half as against cash outgo of $8.22 million in the last year period. The company has spent $48.28 million cash to meet investing activities during the first six months as against cash outgo of $14.33 million in the last year period.
Cash flow from financing activities was $49.43 million for the first six months, up 3,099.22 percent or $47.88 million, when compared with the last year period.
Cash and cash equivalents stood at $53.68 million as on Mar. 31, 2017, down 23.31 percent or $16.31 million from $70 million on Mar. 31, 2016.
Working capital drops significantly
Model N has witnessed a decline in the working capital over the last year. It stood at $21.13 million as at Mar. 31, 2017, down 60.75 percent or $32.71 million from $53.84 million on Mar. 31, 2016. Current ratio was at 1.32 as on Mar. 31, 2017, down from 2.25 on Mar. 31, 2016.
Days sales outstanding went down to 67 days for the quarter compared with 78 days for the same period last year.
At the same time, days payable outstanding went up to 15 days for the quarter from 10 for the same period last year.
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