The Timken Company (TKR) has reported a 67.51 percent plunge in profit for the quarter ended Sep. 30, 2016. The company has earned $20.60 million, or $0.26 a share in the quarter, compared with $63.40 million, or $0.75 a share for the same period last year. On the other hand, adjusted net income for the quarter stood at $38.90 million, or $0.49 a share compared with $46.70 million or $0.55 a share, a year ago. Revenue during the quarter dropped 7.07 percent to $657.40 million from $707.40 million in the previous year period. Gross margin for the quarter contracted 214 basis points over the previous year period to 25.48 percent. Total expenses were 93.55 percent of quarterly revenues, up from 90.57 percent for the same period last year. That has resulted in a contraction of 298 basis points in operating margin to 6.45 percent.
Operating income for the quarter was $42.40 million, compared with $66.70 million in the previous year period.
We performed well again this quarter, demonstrating our ability to navigate a challenging market environment," said Richard G. Kyle, Timken president and chief executive officer. "While most industrial sectors remain weak, our earnings are on track for the year and we continue to focus on organic outgrowth initiatives, operational excellence and deploying capital to create shareholder value."
For financial year 2016, The Timken Company projects revenue to grow in the range of 7 percent to 8 percent. The company forecasts diluted earnings per share to be in the range of $1.77 to $1.83. It company forecasts diluted earnings per share to be in the range of $1.92 to $1.98 on adjusted basis.
Operating cash flow improves
The Timken Company has generated cash of $277.10 million from operating activities during the nine month period, up 12.51 percent or $30.80 million, when compared with the last year period. The company has spent $143.30 million cash to meet investing activities during the nine month period as against cash outgo of $268.80 million in the last year period.
The company has spent $138.10 million cash to carry out financing activities during the nine month period as against cash outgo of $90.20 million in the last year period.
Cash and cash equivalents stood at $129 million as on Sep. 30, 2016, down 16.77 percent or $26 million from $155 million on Sep. 30, 2015.
Working capital remains almost stable
Working capital of The Timken Company remained almost stable for the quarter at $776.30 million, when compared with the previous year period. Current ratio was at 2.72 as on Sep. 30, 2016, up from 2.28 on Sep. 30, 2015.
Cash conversion cycle (CCC) has decreased to 87 days for the quarter from 136 days for the last year period. Days sales outstanding went up to 66 days for the quarter compared with 62 days for the same period last year.
Days inventory outstanding has decreased to 54 days for the quarter compared with 105 days for the previous year period. At the same time, days payable outstanding went up to 33 days for the quarter from 31 for the same period last year.
Debt comes down
The Timken Company has recorded a decline in total debt over the last one year. It stood at $663.90 million as on Sep. 30, 2016, down 8.38 percent or $60.70 million from $724.60 million on Sep. 30, 2015. Total debt was 23.55 percent of total assets as on Sep. 30, 2016, compared with 24.59 percent on Sep. 30, 2015. Debt to equity ratio was at 0.49 as on Sep. 30, 2016, down from 0.54 as on Sep. 30, 2015. Interest coverage ratio deteriorated to 5.58 for the quarter from 8.34 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
