Murphy USA Inc (MUSA) swung to a net loss for the quarter ended Mar. 31, 2017. The company has made a net loss of $3.03 million, or $ 0.08 a share in the quarter, against a net profit of $85.87 million, or $2.08 a share in the last year period. Revenue during the quarter grew 20.45 percent to $2,999.62 million from $2,490.26 million in the previous year period. Gross margin for the quarter contracted 284 basis points over the previous year period to 6.44 percent. Total expenses were 99.90 percent of quarterly revenues, up from 97.62 percent for the same period last year. That has resulted in a contraction of 228 basis points in operating margin to 0.10 percent.
Operating income for the quarter was $2.88 million, compared with $59.16 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $30.33 million compared with $83.05 million in the prior year period. At the same time, adjusted EBITDA margin contracted 232 basis points in the quarter to 1.01 percent from 3.34 percent in the last year period.
“After posting our highest first quarter last year, Q1 EBITDA this year fell to its lowest level since 2012 as record industry refined product inventory levels led to depressed wholesale prices, regulatory and political uncertainty dampened RIN prices, and seasonally weak demand at the beginning of the year impacted retail volume," said president and chief executive officer Andrew Clyde. "However, throughout these peaks and troughs associated with fuel volatility, we continue to drive significant improvements to our underlying business, leading to higher total merchandising profits and lower per-store operating expenses. At the same time, we continue to execute our approach to strategic capital allocation, balancing high quality organic growth with meaningful share repurchases, while leveraging our balance sheet appropriately. As Q1 market factors have begun to normalize, our long-term approach to managing the business shines through."
Operating cash flow turns negative
Murphy USA Inc has spent $45.95 million cash to meet operating activities during the quarter as against cash inflow of $76.91 million in the last year period. The company has spent $65.44 million cash to meet investing activities during the quarter as against cash outgo of $26.22 million in the last year period.
The company has spent $6.17 million cash to carry out financing activities during the quarter as against cash inflow of $42.67 million in the last year period.
Cash and cash equivalents stood at $36.26 million as on Mar. 31, 2017, down 81.47 percent or $159.44 million from $195.70 million on Mar. 31, 2016.
Working capital turns negative
Working capital of Murphy USA Inc has turned negative to $57.90 million on Mar. 31, 2017 from positive $90.54 million on Mar. 31, 2016. Current ratio was at 0.87 as on Mar. 31, 2017, down from 1.23 on Mar. 31, 2016.
Days sales outstanding were almost stable at 4 days for the quarter, when compared with the last year period.
Days inventory outstanding has decreased to 3 days for the quarter compared with 6 days for the previous year period.
Debt remains almost stable
Total debt of Murphy USA Inc remained almost stable for the quarter at $687.42 million, when compared with the last year period. Total debt was 34.32 percent of total assets as on Mar. 31, 2017, compared with 34.05 percent on Mar. 31, 2016. Debt to equity ratio was at 1.02 as on Mar. 31, 2017, up from 0.95 as on Mar. 31, 2016. Interest coverage ratio deteriorated to 0.30 for the quarter from 6.30 for the same period last year. D
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