NCI, Inc (NCIT) swung to a net loss for the quarter ended Mar. 31, 2017. The company has made a net loss of $0.81 million, or $ 0.06 a share in the quarter, against a net profit of $2.59 million, or $0.19 a share in the last year period. On an adjusted basis, net profit for the quarter was almost stable at $3.52 million, or $0.25 a share, when compared with the last year period. Revenue during the quarter dropped 5.86 percent to $78.75 million from $83.66 million in the previous year period. Gross margin for the quarter expanded 116 basis points over the previous year period to 17.85 percent. Operating margin for the quarter stood at negative 1.32 percent as compared to a positive 5.41 percent for the previous year period.
Operating loss for the quarter was $1.04 million, compared with an operating income of $4.52 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $7.36 million compared with $7.86 million in the prior year period. At the same time, adjusted EBITDA margin contracted 4 basis points in the quarter to 9.35 percent from 9.39 percent in the last year period.
“NCI turned in a solid performance in the first quarter. We’re seeing the topline impact of awards in the second half of 2016 as well as additional task order revenue on several of our IDIQ vehicles,” said NCI’s president and chief executive officer Paul A. Dillahay. “I’m especially pleased with margin improvements as a result of the higher contribution of fixed-price contracts to our revenue mix, which we anticipate will lift profitability throughout the remainder of 2017. Therefore, we’re increasing the midpoint of our revenue guidance range by $10 million and raising the midpoint of our adjusted EPS guidance range by $0.09 to reflect greater expected profitability, primarily from our agile software development revenue, over the remainder of the year.”
For the second-quarter, Nci forecasts revenue to be in the range of $81 million to $87 million. Nci forecasts revenue to be in the range of $324 million to $342 million for fiscal year 2017. On an adjusted basis, the company expects diluted earnings per share to be in the range of $0.24 to $0.26 for the second-quarter. For fiscal year 2017, the company expects diluted earnings per share to be in the range of $0.95 to $1.05 on adjusted basis.
Operating cash flow turns positive
NCI, Inc has generated cash of $1.14 million from operating activities during the quarter as against cash outgo of $8.16 million in the last year period. The company has spent $0.14 million cash to meet investing activities during the quarter as against cash outgo of $0.34 million in the last year period.
The company has spent $0.16 million cash to carry out financing activities during the quarter as against cash inflow of $8.65 million in the last year period.
Cash and cash equivalents stood at $1.85 million as on Mar. 31, 2017, up 377.06 percent or $1.46 million from $0.39 million on Mar. 31, 2016.
Working capital increases sharply
NCI, Inc has recorded an increase in the working capital over the last year. It stood at $16.78 million as at Mar. 31, 2017, up 34.37 percent or $4.29 million from $12.49 million on Mar. 31, 2016. Current ratio was at 1.37 as on Mar. 31, 2017, up from 1.20 on Mar. 31, 2016.
Days sales outstanding went down to 65 days for the quarter compared with 70 days for the same period last year.
At the same time, days payable outstanding went down to 21 days for the quarter from 25 for the same period last year.
Debt comes down significantly
NCI, Inc has recorded a decline in total debt over the last one year. It stood at $2 million as on Mar. 31, 2017, down 90.24 percent or $18.50 million from $20.50 million on Mar. 31, 2016. Nci has recorded a decline in short-term debt over the last one year. It stood at $2 million as on Mar. 31, 2017, down 90.24 percent or $18.50 million from $20.50 million on Mar. 31, 2016. Total debt was 1.26 percent of total assets as on Mar. 31, 2017, compared with 11.79 percent on Mar. 31, 2016. Debt to equity ratio was at 0.02 as on Mar. 31, 2017, down from 0.19 as on Mar. 31, 2016.
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