Sysorex (SYRX) saw its loss widen to $4.72 million, or $0.18 a share for the quarter ended Sep. 30, 2016. In the previous year period, the company reported a loss of $3.17 million, or $0.16 a share.
Revenue during the quarter dropped 24.43 percent to $11.24 million from $14.87 million in the previous year period. Gross margin for the quarter contracted 194 basis points over the previous year period to 27.56 percent. Operating margin for the quarter stood at negative 36.85 percent as compared to a negative 21 percent for the previous year period.
Operating loss for the quarter was $4.14 million, compared with an operating loss of $3.12 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at negative $2.37 million compared to negative $1.46 million in the prior year second quarter. At the same time, adjusted EBITDA margin stood at negative 21.05 percent for the quarter compared to negative 9.84 percent in the last year period.
"Our Storage & Computing segment continued to see softening in the third quarter due to the challenges facing the VAR industry, especially with private sector customers. I will discuss on our earnings call today the two strategies we are implementing to address these challenges. First of course is our move to increase our value proposition to our customers by owning our proprietary technologies such as AirPatrol and LightMiner." said Mr. Nadir Ali, chief executive officer of Sysorex.
Operating cash flow remains negative
Sysorex Global has spent $1.14 million cash to meet operating activities during the nine month period as against cash outgo of $3.89 million in the last year period.
The company has spent $1.62 million cash to meet investing activities during the nine month period as against cash outgo of $0.89 million in the last year period.
The company has spent $0.83 million cash to carry out financing activities during the nine month period as against cash inflow of $6.94 million in the last year period.
Cash and cash equivalents stood at $0.50 million as on Sep. 30, 2016, down 90.59 percent or $4.86 million from $5.36 million on Sep. 30, 2015.
Working capital remains negative
Working capital of Sysorex Global was negative $10.34 million on Sep. 30, 2016 compared with negative $4.89 million on Sep. 30, 2015. Current ratio was at 0.66 as on Sep. 30, 2016, down from 0.84 on Sep. 30, 2015.
Cash conversion cycle (CCC) has increased to 13 days for the quarter from 4 days for the last year period. Days sales outstanding went up to 83 days for the quarter compared with 67 days for the same period last year.
Days inventory outstanding has decreased to 5 days for the quarter compared with 6 days for the previous year period. At the same time, days payable outstanding went up to 101 days for the quarter from 70 for the same period last year.
Debt moves up
Sysorex Global has witnessed an increase in total debt over the last one year. It stood at $8.35 million as on Sep. 30, 2016, up 7.48 percent or $0.58 million from $7.77 million on Sep. 30, 2015. Total debt was 14.65 percent of total assets as on Sep. 30, 2016, compared with 11.64 percent on Sep. 30, 2015. Debt to equity ratio was at 0.55 as on Sep. 30, 2016, up from 0.29 as on Sep. 30, 2015.
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