On Dec. 12, telecommunications equipment maker ADC Telecommunications (NASDAQ:ADCT) released fourth-quarter 2006 earnings for the period ending Oct. 31, 2006.
- The straight-up earnings results sure look great, but remember that they include a one-time tax benefit of $44.7 million. The more objective free cash flow metric is down from last year.
- By pushing its own bill payments into the future faster than it lets its customers do the same, ADC overcomes rising inventory.
- The CAPS community doesn't have much love for ADC, giving the stock a one-star rating. Agree? Disagree? Let us know and make us all smarter.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Q4 2006 |
Q4 2005 |
Change | |
|---|---|---|---|
|
Sales |
$307.4 |
$294.0 |
4.6% |
|
Net Profit from continuing ops. |
$47.2 |
$10.3 |
358.3% |
|
EPS from continuing ops. |
$0.38 |
$0.09 |
322.2% |
|
Diluted Shares |
131.5 |
117.7 |
11.7% |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q4 2006 |
Q4 2005 |
Change* | |
|---|---|---|---|
|
Gross Margin |
30.22% |
37.24% |
(7.02) |
|
Operating Margin |
(0.23%) |
4.29% |
(4.52) |
|
Net Margin |
15.35% |
3.50% |
11.85 |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
|
Assets |
Q4 2006 |
Q4 2005 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$537.7 |
$443.7 |
21.2% |
|
Accounts Rec. |
$171.0 |
$180.6 |
(5.3%) |
|
Inventory |
$165.5 |
$140.4 |
17.9% |
|
Liabilities |
Q4 2006 |
Q4 2005 |
Change |
|---|---|---|---|
|
Accounts Payable |
$88.4 |
$69.6 |
27.0% |
|
Long-Term Debt |
$400.0 |
$400.0 |
0.0% |
Learn the ways of the balance sheet.
Cash Flow Highlights
|
Q4 2006 |
Q4 2005 |
Change | |
|---|---|---|---|
|
Cash From Continuing Ops. |
$35.5 |
$50.4 |
(29.6%) |
|
Capital Expenditures |
$10.2 |
$10.7 |
(4.7%) |
|
Free Cash Flow |
$25.73 |
$39.7 |
(35.3%) |
Find out why Fools always follow the money.
Related Companies:
- Corning (NYSE:GLW)
- Arris Group (NASDAQ:ARRS)
- Inter-Tel (NASDAQ:INTL)
Related Foolishness:
- Foolish Forecast: What's Bothering ADC?
- Foolish Forecast: ADC Communicates
- There Are No Cheap Stocks
Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.
At the time of publication, Anders Bylund had no position in any company mentioned. Fool rules are here.
