Black Box Corporation (NASDAQ:BBOX) Q1 2017 Earnings Conference Call - Final Transcript
Aug 02, 2016 • 05:00 pm ET
Good day, ladies and gentlemen, and welcome to the First Quarter Fiscal 2017 Financial Results Conference Call. (Operator Instructions) I would like to introduce your host for today's conference, Ron Basso, EVP, General Counsel. You may begin.
Thank you. Good evening, and welcome to Black Box Corporation's First Quarter of Fiscal 2017 Earnings Conference Call. With me today are E.C. Sykes, our President and CEO; and Tim Huffmyer, our VP and CFO.
Earlier today, we announced our first quarter fiscal 2017 results by issuing a press release and furnishing it to the Securities and Exchange Commission on Form 8-K. We also posted this press release in the IR section of our website, blackbox.com.
In addition to commentary from E.C. and Tim, we have a brief slide presentation supplementing the call. Those slides also are available in the IR section of our website. For those of you who are accessing the webcast, the slides will present on your screen.
(Forward-Looking Cautionary Statements)
On this call, and as presented in today's press release, we will discuss some non-GAAP financial measures. Please refer to the schedules that accompany the press release for a reconciliation of these non-GAAP financial measurements to the most directly comparable GAAP financial measurement and other supplemental information.
With that, now I would like to turn the call over to E.C.
Thanks, Ron. Welcome, and thank you for joining us today on our call. This is my second earnings call since I joined the company in February. I'd like to start by noting that, for the most part, I'm satisfied with the results for the first quarter.
Revenues and gross profit slightly exceeded our expectations, allowing for OpEx investments to improve future margins and maintain adjusted operating income in line with our expectations. I'll discuss each of these elements in more detail later in the call.
As I mentioned on our last call, managing working capital will be a focus for us. The team responded well to the initiatives regarding efficient use of working capital as it reflected an improvement of 2.5 million sequentially and 42.7 million compared to last year's first quarter.
We will, of course, have fluctuations in working capital over our business cycle. We are continuing to develop programs to improve the working capital ratios, and expect our actions to continue to progress.
Additionally, we had strong cash flow in what recently has been a negative cash flow quarter for us. This allowed us to reduce debt again, putting us at the lowest net debt position in over 11 years. I am pleased we're able to slightly decrease our leverage as we manage through the transformation plan.
We believe our strengthened balance sheet has positioned us well for future strategic investments. Now I need to tamper my remarks somewhat. I'm only one quarter into the transformation and we have a lot of work to do. Our backlog improved quarter-over-quarter, but is below the target set to support our financial objectives for the second quarter.
This increases the pressure