RTI Surgical Inc (RTIX) swung to a net loss for the quarter ended Mar. 31, 2017. The company has made a net loss of $1.87 million, or $ 0.05 a share in the quarter, against a net profit of $2.40 million, or $0.03 a share in the last year period. On an adjusted basis, net profit for the quarter was $0.14 million, when compared with $1.73 million in the last year period. Revenue during the quarter grew 3.84 percent to $69.94 million from $67.35 million in the previous year period. Gross margin for the quarter contracted 233 basis points over the previous year period to 51.16 percent. Operating margin for the quarter stood at negative 2.84 percent as compared to a positive 5.94 percent for the previous year period.
Operating loss for the quarter was $1.98 million, compared with an operating income of $4 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $6.49 million compared with $9.12 million in the prior year period. At the same time, adjusted EBITDA margin contracted 427 basis points in the quarter to 9.28 percent from 13.54 percent in the last year period.
“I am pleased that our initial strategic initiatives are taking hold as evidenced by two consecutive quarters of improving performance. While these results are a positive sign, we still have significant work ahead of us,” said Camille Farhat, chief executive officer, RTI. “We are in the early stages of what will be a long-term transformation of the company. Our current focus is on cost reduction, disciplined execution and targeted innovation to better position RTI’s operating platform for growth and profitability.”
RTI SURGICAL forecasts revenue to be in the range of $274 million to $285 million for fiscal year 2017. For fiscal year 2017, the company expects diluted earnings per share to be in the range of $0.01 to $0.06. For fiscal year 2017, the company expects diluted earnings per share to be in the range of $0.05 to $0.10 on adjusted basis.
Operating cash flow improves significantly
RTI Surgical Inc has generated cash of $9.58 million from operating activities during the quarter, up 49.10 percent or $3.15 million, when compared with the last year period. The company has spent $3.60 million cash to meet investing activities during the quarter as against cash outgo of $5.83 million in the last year period.
The company has spent $2.28 million cash to carry out financing activities during the quarter as against cash outgo of $1.49 million in the last year period.
Cash and cash equivalents stood at $17.60 million as on Mar. 31, 2017, up 50.05 percent or $5.87 million from $11.73 million on Mar. 31, 2016.
Working capital increases sharply
RTI Surgical Inc has recorded an increase in the working capital over the last year. It stood at $116.17 million as at Mar. 31, 2017, up 276.11 percent or $85.28 million from $30.89 million on Mar. 31, 2016. Current ratio was at 2.90 as on Mar. 31, 2017, up from 1.86 on Mar. 31, 2016.
Cash conversion cycle (CCC) has decreased to 144 days for the quarter from 168 days for the last year period. Days sales outstanding went down to 54 days for the quarter compared with 60 days for the same period last year.
Days inventory outstanding has decreased to 155 days for the quarter compared with 172 days for the previous year period. At the same time, days payable outstanding was almost stable at 64 days for the quarter, when compared with the previous year period.
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