Snowman Logistics slumps on poor Q1

Snowman Logistics, a major beneficiary of the GST Bill, after all this build up, first saw profit booking and now a dismal performance for Q1Fy17. The stock price today dropped over 8% to an intra day low of Rs.72.50 and it continues to remain deep in the red, down 7%.

The company’s performance for Q1FY17 was very disappointing. Its net profit for the quarter slipped 67% (YoY) at Rs.2 crore on a 16% decline in total income at Rs.50 crore. EBITDA was up 19% at Rs.15 crore though margins on account of lower costs, showed a jump up from 20.8% to 29.6%. Operating expenses were down 34%.

The company has said that it was restructuring which affected the earnings. Its decision to quit its loss-making food services business, bringing down its exposure in long-distance road transportation and decision to focus back on its core business of temperature controlled warehousing impacted the topline and thus the cascading effect right till the bottomline.