Carbon Natural Gas Co. :CRBO-US
Earnings Analysis: Q1, 2017
By the Numbers : May 31, 2017

 

 

May 31, 2017 by CapitalCube

Carbon Natural Gas Co. reports financial results for the quarter ended March 31, 2017.  (View…)

Highlights

  • Summary numbers: Revenues of USD 5.05 million, Net Earnings of USD 3.29 million.
  • Gross margins widened from 12.90% to 53.56% compared to the same period last year, operating (EBITDA) margins now 25.21% from -52.18%.
  • Year-on-year change in operating cash flow of 8,027.27% is about the same as the change in earnings, likely no significant movement in accruals or reserves.
  • Earnings growth from operating margin improvements as well as one-time items.

 

The table, on the right, shows the preliminary results and recent trends for key metrics such as revenues and net income growth:

 

Earnings Growth Analysis

 

 

The company’s earnings growth was influenced by year-on-year improvement in gross margins from 12.90% to 53.56% as well as better cost controls. As a result, operating margins (EBITDA margins) rose from -52.18% to 25.21% compared to the same period last year. For comparison, gross margins were 46.90% and EBITDA margins were -14.62% in the last reporting period.

 

 

Gross Margin Trends

 

 

CRBO-US‘s change in operating cash flow of 8,027.27% compared to the same period last year is about the same as its change in earnings this period. Additionally, this change in operating cash flow is about average among its peer group. This suggests that the company did not use accruals or reserves to manage earnings this period, and that, all else being equal, the earnings number is sustainable.