Smart & Final Stores, Inc. (SFS) swung to a net loss for the quarter ended Jan. 01, 2017. The company has made a net loss of $0.25 million in the quarter, against a net profit of $9.96 million in the last year period. On the other hand, adjusted net income for the quarter stood at $5 million, or $0.07 a share compared with $14.72 million or $0.19 a share, a year ago.
Revenue during the quarter went up marginally by 0.30 percent to $1,000.63 million from $997.63 million in the previous year period. Gross margin for the quarter contracted 74 basis points over the previous year period to 14.08 percent. Total expenses were 99.43 percent of quarterly revenues, up from 97.79 percent for the same period last year. That has resulted in a contraction of 163 basis points in operating margin to 0.57 percent.
Operating income for the quarter was $5.73 million, compared with $22 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $37.31 million compared with $47.36 million in the prior year period. At the same time, adjusted EBITDA margin contracted 102 basis points in the quarter to 3.73 percent from 4.75 percent in the last year period.
"We are pleased with our performance in 2016, which marks a period of unprecedented store growth," said David Hirz, President and Chief Executive Officer. "Our 2016 store development included the successful integration of a major acquisition resulting in the largest number of new Smart & Final Extra! stores in a single year in the Company’s history, and we simultaneously expanded our Cash & Carry banner. We continue to build upon our differentiated brand message as the one-stop shop for business and household needs, and to communicate Smart & Final’s unique banner propositions to both new and existing customers."
For the fiscal year 2017, Smart & Final Stores, Inc. projects revenue to grow in the range of 5.50 percent to 6.50 percent. The company forecasts adjusted net income to be in the range of $39 million to $43 million and forecasts diluted earnings per share to be in the range of $0.50 to $0.55 on adjusted basis.
Operating cash flow drops significantly
Smart & Final Stores, Inc. has generated cash of $97.09 million from operating activities during the year, down 33.22 percent or $48.30 million, when compared with the last year.
The company has spent $153.25 million cash to meet investing activities during the year as against cash outgo of $196.62 million in the last year. It has incurred net capital expenditure of $148.97 million on net basis during the year, up 15.57 percent or $20.07 million from year ago.
Cash flow from financing activities was $51.07 million for the year, up 1,278.33 percent or $47.36 million, when compared with the last year.
Cash and cash equivalents stood at $54.24 million as on Jan. 01, 2017, down 8.58 percent or $5.09 million from $59.33 million on Jan. 03, 2016.
Debt moves up
Smart & Final Stores, Inc. has witnessed an increase in total debt over the last one year. It stood at $678.94 million as on Jan. 01, 2017, up 14.91 percent or $88.08 million from $590.86 million on Jan. 03, 2016. Total debt was 34.77 percent of total assets as on Jan. 01, 2017, compared with 32.44 percent on Jan. 03, 2016. Debt to equity ratio was at 1.23 as on Jan. 01, 2017, up from 1.04 as on Jan. 03, 2016.
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