WebMD Health Corp. (WBMD) has reported a 63.92 percent jump in profit for the quarter ended Sep. 30, 2016. The company has earned $21.62 million, or $0.47 a share in the quarter, compared with $13.19 million, or $0.32 a share for the same period last year.
Revenue during the quarter grew 12.34 percent to $171.44 million from $152.61 million in the previous year period. Gross margin for the quarter expanded 84 basis points over the previous year period to 61.82 percent. Total expenses were 75.04 percent of quarterly revenues, down from 80.34 percent for the same period last year. This has led to an improvement of 531 basis points in operating margin to 24.96 percent.
Operating income for the quarter was $42.80 million, compared with $30 million in the previous year period.
"We are pleased to report third quarter results around the high end of our expectations and we remain well positioned to deliver strong fourth quarter and full year performance," said Steve Zatz, chief executive officer, WebMD. "WebMD continues to demonstrate the value that we bring to our customers across both our professional and consumer platforms."
For the fourth-quarter 2016, WebMD Health Corp. projects revenue to be in the range of $200 million to $210 million. The company net income to be in the range of $32 million to $37 million.
For fiscal year 2016, WebMD Health Corp. projects revenue to be in the range of $698 million to $708 million. The company expects net income to be in the range of $86.80 million to $92.30 million. The company forecasts diluted earnings per share to be in the range of $1.88 to $1.97.
Operating cash flow improves significantly
WebMD Health Corp. has generated cash of $122.28 million from operating activities during the nine month period, up 58.44 percent or $45.10 million, when compared with the last year period.
The company has spent $971.33 million cash to meet investing activities during the nine month period as against cash outgo of $25.50 million in the last year period.
Cash flow from financing activities was $296.49 million for the nine month period as against cash outgo of $146.12 million in the last year period.
Cash and cash equivalents stood at $88.60 million as on Sep. 30, 2016, down 85.53 percent or $523.73 million from $612.33 million on Sep. 30, 2015.
Working capital increases sharply
WebMD Health Corp. has recorded an increase in the working capital over the last year. It stood at $1,041.17 million as at Sep. 30, 2016, up 102.13 percent or $526.07 million from $515.10 million on Sep. 30, 2015. Current ratio was at 7.19 as on Sep. 30, 2016, up from 2.87 on Sep. 30, 2015.
Days sales outstanding went down to 81 days for the quarter compared with 89 days for the same period last year.
Debt increases substantially
WebMD Health Corp. has witnessed an increase in total debt over the last one year. It stood at $1,043.61 million as on Sep. 30, 2016, up 30.02 percent or $240.93 million from $802.68 million on Sep. 30, 2015. Total debt was 68.51 percent of total assets as on Sep. 30, 2016, compared with 73.31 percent on Sep. 30, 2015. Debt to equity ratio was at 3.69 as on Sep. 30, 2016, down from 8.28 as on Sep. 30, 2015. Interest coverage ratio improved to 6.06 for the quarter from 5.28 for the same period last year.
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