Actuant Reports Fourth Quarter Results; Increases Fiscal 2011 Guidance
MILWAUKEE--(BUSINESS WIRE)-- Actuant Corporation (NYSE: ATU) today announced results for its fourth quarter ended August 31, 2010.
Highlights
-- 82% year-over-year increase in diluted earnings per share from
continuing operations ("EPS") to $0.31 (excluding special items - see
attached reconciliation of earnings.)
-- Core revenue growth (total sales less the impact of acquisitions,
divestitures and foreign currency rate changes) of 18%. Significant
year-over-year core sales growth in Industrial and Engineered Solutions
segments of 33% and 37%, respectively.
-- Operating profit margin expansion of 360 basis points, excluding
restructuring costs.
-- Robust cash flow from operating activities totaling $52 million.
-- Completed the Selantic acquisition, strengthening the Cortland
engineered cable and rope business.
-- Announced intention to divest the European Electrical business to focus
on platforms that are central to strategic growth initiatives.
Robert C. Arzbaecher, Chairman and CEO of Actuant commented, "Actuant had a strong fourth quarter and finished the year on a positive note. In particular, we were pleased to see double-digit core sales growth for the second straight quarter and excellent cash flow. Our fourth quarter core revenue growth of 18% exceeded the high-end of our expectations with strong growth in both Industrial and Engineered Solutions. The increased volumes, along with continued margin improvement, drove the robust EPS growth. Free cash flow also exceeded our forecast due to higher earnings and strong working capital management. I am tremendously proud of what the Actuant team has achieved this year, especially our second half results, and am equally enthusiastic about our prospects for 2011."
Consolidated Results
In September, the Company announced its intention to divest its European Electrical business. The results of operations for this business, as well as the previously announced non-cash asset impairment charge, are reported in discontinued operations in the accompanying Condensed Consolidated Statement of Operations. Operating results for the fourth quarter and all prior periods have been reclassified for comparability.
Consolidated sales for the fourth quarter were $310 million, 19% higher than the comparable prior year quarter. Core sales increased 18% with acquisitions contributing an additional 4%, offset by the stronger U.S. dollar (-3%). The fiscal 2010 fourth quarter net loss was $16.8 million, or ($0.22) per share compared to net earnings and EPS of $16.5 million and $0.24, respectively, in the comparable prior year quarter. The current year quarter included a $37.7 million ($0.51 per diluted share) loss from discontinued operations, primarily the result of the $36.1 million non-cash asset impairment charge related to the planned divestiture of the European Electrical business. Prior year fourth quarter net earnings included a $12.6 million ($0.18 per diluted share) net gain from discontinued operations, primarily reflecting the divestiture of Acme Aerospace. Earnings and EPS from continuing operations in the fiscal 2010 fourth quarter were $20.9 million and $0.29, respectively, compared to $3.9 million and $0.06 in the comparable prior year quarter. Results for the fourth quarter of fiscal 2010 included pre-tax restructuring costs (including those reported in cost of products sold) of $2.4 million, or $0.02 per diluted share. Fiscal 2009 fourth quarter continuing operations results included pre-tax restructuring costs of $9.1 million, ($0.09 per diluted share) as well as a $2.1 million ($0.02 per diluted share) pre-tax debt extinguishment charge. Excluding these items, EPS from continuing operations was $0.31 in the fourth quarter of fiscal 2010, 82% higher than the $0.17 in the prior year. (See attached reconciliation of earnings.)
Sales for the year ended August 31, 2010 were $1,161 million, 4% higher than the $1,118 million in the comparable prior year period. Excluding the impact of acquisitions (+1%) and the weaker US dollar (+1%), full year core sales increased 2%. Net earnings for the year ended August 31, 2010 were $24.0 million or $0.35 per diluted share, compared to $13.7 million, or $0.24 per diluted share in the comparable prior year period. Earnings and EPS from continuing operations for the year ended August 31, 2010 were $70.4 million, or $0.97 per diluted share, compared to $26.0 million, or $0.43 per diluted share for the comparable prior year period. Full year fiscal 2010 results include pre-tax restructuring costs of $16.7 million, or $0.16 per diluted share, as well as income tax adjustments of $0.6 million or $0.01 per diluted share. Results from continuing operations for the year ended August 31, 2009 included $31.3 million ($0.29 per diluted share) of pre-tax asset impairment charges, $20.8 million ($0.20 per diluted share) of pre-tax restructuring costs and a $1.7 million ($0.02 per diluted share) pre-tax debt extinguishment charge. Excluding these items, current year diluted EPS from continuing operations was $1.08, a 15% improvement from $0.94 in the comparable prior year period. (See attached reconciliation of earnings.)
Segment Results
Industrial Segment
(US $ in millions)
Three Months Ended Twelve Months Ended
August 31, August 31,
2010 2009 2010 2009
Sales $85.7 $61.8 $300.0 $286.9
Operating Profit $21.4 $11.3 $66.3 $67.5
Adjusted Operating Profit(1) $21.8 $13.7 $72.2 $71.4
Adjusted Operating Profit %(1) 25.4% 22.2% 24.1% 24.9%
(1) Excludes restructuring costs of $0.4 million and $5.8 million for the three and twelve months ended August 31, 2010 and $2.4 million and $3.9 million for the three and twelve months ended August 31, 2009, respectively.
Fourth quarter fiscal 2010 Industrial segment sales were $86 million, 39% higher than the prior year. Excluding foreign currency rate changes (-3%), and the benefit of the Integrated Solutions (IS) acquisitions (+9%), Industrial segment core sales increased 33% due to robust demand across most markets. This 33% year-over-year core sales growth represents sequential improvement from the 20% increase in the third quarter of fiscal 2010. Operating profit margins (excluding restructuring costs) improved 320 basis points from the prior year despite unfavorable mix related to the recent IS acquisitions, due to the higher volumes as well as the benefit of restructuring actions.
Energy Segment
(US $ in millions)
Three Months Ended Twelve Months Ended
August 31, August 31,
2010 2009 2010 2009
Sales $61.2 $63.7 $235.7 $259.5
Operating Profit $8.2 $11.1 $30.7 $44.1
Adjusted Operating Profit(2) $8.3 $11.8 $32.7 $45.1
Adjusted Operating Profit %(2) 13.5% 18.5% 13.9% 17.4%
(2) Excludes restructuring costs of $0.1 million and $2.0 million for the three and twelve months ended August 31, 2010 and $0.7 million and $1.0 million for the three and twelve months ended August 31, 2009, respectively.
Fiscal 2010 fourth quarter year-over-year Energy segment sales decreased 4% to $61 million. Excluding the 4% unfavorable FX impact and 7% contribution from acquisitions, core sales declined 7% due primarily to continued weakness in mature market refinery maintenance activity, seismic exploration and large capital project based revenue. However, the core sales rate of change improved from -11% in the third quarter, and increased 8% sequentially, as emerging markets, alternative energy and adjacent markets generated increased activity. Fourth quarter operating profit margin (excluding restructuring costs) was 13.5%, a 60 basis point sequential improvement; however, it was below the prior year due to the unfavorable mix of lower product sales in relation to service and rental revenue.
Electrical Segment
(US $ in millions)
Three Months Ended Twelve Months Ended
August 31, August 31,
2010 2009 2010 2009
Sales $62.7 $58.8 $233.7 $242.0
Operating Profit (Loss) $6.5 $0.8 $19.9 $3.3
Adjusted Operating Profit(3) $7.4 $3.6 $24.4 $15.0
Adjusted Operating Profit %(3) 11.9% 6.1% 10.4% 6.2%
(3) Excludes restructuring costs of $0.9 million and $4.5 million for the three and twelve months ended August 31, 2010, respectively. Excludes restructuring costs of $2.8 million and $6.9 million for the three and twelve months ended August 31, 2009, respectively. The twelve months ended August 31, 2009 also excludes $4.8 million of impairment charges.
Electrical segment fiscal 2010 fourth quarter sales were $63 million, 7% higher than the comparable prior year quarter due to continued improvement in the North American marine and industrial markets. Electric utility and commercial construction market activity appears to have stabilized, albeit at low levels. Fourth quarter operating profit margin (excluding restructuring costs) increased 580 basis points from the prior year reflecting higher volumes and restructuring driven cost savings.
Engineered Solutions Segment
(US $ in millions)
Three Months Ended Twelve Months Ended
August 31, August 31,
2010 2009 2010 2009
Sales $100.8 $76.7 $391.1 $329.3
Operating Profit (Loss) $9.5 $(2.7) $31.7 $(28.4)
Adjusted Operating Profit(4) $10.2 $0.3 $35.3 $6.5
Adjusted Operating Profit %(4) 10.2% 0.4% 9.0% 2.0%
(4) Excludes restructuring costs of $0.8 million and $3.6 million for the three and twelve months ended August 31, 2010 and $3.0 million and $8.3 million for the three and twelve months ended August 31, 2009. The twelve months ended August 31, 2009 also excludes $26.6 million of impairment charges.
Fourth quarter fiscal 2010 Engineered Solutions segment sales increased 31% from the prior year to $101 million. Excluding the impact of acquisitions (+2%) and the stronger U.S. dollar (-8%), year-over-year core sales growth was 37%. Fourth quarter sales benefited from continued strong demand from the automotive and European truck markets and significantly higher shipments to agriculture, construction equipment and North America truck customers. Fourth quarter operating margins (excluding restructuring costs) increased 980 basis points compared to the prior year due to restructuring driven cost reductions and substantially improved volumes.
Corporate
Corporate expenses for the fourth quarter of fiscal 2010, excluding restructuring charges of $0.3 million, were $7.7 million, an increase of approximately $2.7 million from last year. The increase is due to higher 401(k), salary and incentive compensation costs compared to last year's recessionary levels.
Financial Position
Net debt at August 31, 2010 was $327 million (total debt of $367 million less $40 million of cash). The Company deployed approximately $17 million during the quarter to fund the Selantic acquisition and reduced net debt by approximately $32 million as a result of strong operating cash flow. This was driven by solid earnings and effective working capital management. Notably, net primary working capital (accounts receivable, inventory and accounts payable) contributed $18 million to cash flow from operating activities in the quarter, despite an 18% increase in core sales. At fiscal year-end, the Company's leverage (Net Debt/EBITDA) was below pre-recession levels and the entire $400 million revolver was available for borrowing to fund growth initiatives.
Outlook
Arzbaecher continued, "As we begin fiscal 2011, we expect the overall global economy to continue to grow at a modest pace. However, we anticipate that some of our businesses will grow faster than the overall Company average due to cyclical rebounds, similar to what we experienced in the fourth quarter in our industrial and vehicle related markets. In addition, our 2011 outlook has been adjusted to reflect the planned divestiture of the European Electrical business.
Excluding future acquisitions, we expect fiscal 2011 EPS from continuing operations in the range of $1.30-1.45, 20-35% higher than comparable fiscal 2010 results. Sales growth and margin expansion will drive most of the improvement. Sales are expected to approximate $1.225-1.275 billion with core growth between 6-10% for the year. Core growth is expected to be stronger in the first half of fiscal 2011 than in the back half due to more difficult comparisons. Projected free cash flow for fiscal 2011 is $130-140 million which, if attained, would represent the 11th consecutive year of free cash flow conversion to net earnings in excess of 100%. In addition, acquisition activity has increased and we are optimistic about the incremental potential such transactions could have on fiscal 2011 results. We expect to start the first quarter of fiscal 2011 off strong with sales in the $315-325 million range and EPS of $0.29-0.34, which at the mid-point is a 50% improvement year-over-year.
Actuant's diversification and execution rewarded shareholders in 2010, with robust demand and profit generation from many of our end markets and geographies, which more than offset the weakness in late cycle Energy markets. We are focused on our long-term organic and acquisition driven growth strategies. With our strong cash flow and borrowing capacity, we are well positioned financially to capitalize on these opportunities."
Conference Call Information
An investor conference call is scheduled for 10am CT today, September 29, 2010. Webcast information and conference call materials will be made available on the Actuant company website (www.actuant.com) prior to the start of the call.
Safe Harbor Statement
Certain of the above comments represent forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. Management cautions that these statements are based on current estimates of future performance and are highly dependent upon a variety of factors, which could cause actual results to differ from these estimates. Actuant's results are also subject to general economic conditions, variation in demand from customers, the impact of geopolitical activity on the economy, continued market acceptance of the Company's new product introductions, the successful integration of acquisitions, restructuring, operating margin risk due to competitive pricing and operating efficiencies, supply chain risk, material and labor cost increases, foreign currency fluctuations and interest rate risk. See the Company's Form 10-K filed with the Securities and Exchange Commission for further information regarding risk factors. Actuant disclaims any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or any other reason.
About Actuant Corporation
Actuant Corporation is a diversified industrial company with operations in more than 30 countries. The Actuant businesses are leaders in a broad array of niche markets including branded hydraulic and electrical tools and supplies; specialized products and services for energy related industries and highly engineered position and motion control systems. The Company was founded in 1910 and is headquartered in Butler, Wisconsin. Actuant trades on the NYSE under the symbol ATU. For further information on Actuant and its businesses, visit the Company's website at www.actuant.com.
(tables follow)
Actuant Corporation
Condensed Consolidated Balance Sheets
(Dollars in thousands)
(Unaudited)
August 31, August 31,
2010 2009
ASSETS
Current assets
Cash and cash equivalents $ 40,222 $ 11,385
Accounts receivable, net 185,693 155,520
Inventories, net 146,154 160,656
Deferred income taxes 30,701 20,855
Other current assets, including assets of
discontinued operations 57,380 15,246
Total current assets 460,150 363,662
Property, plant and equipment, net 108,382 129,118
Goodwill 704,889 711,522
Other intangible assets, net 336,978 350,249
Other long-term assets 11,304 13,880
Total assets $ 1,621,703 $ 1,568,431
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Short-term borrowings - $ 4,964
Trade accounts payable 130,051 108,333
Accrued compensation and benefits 53,212 30,079
Income taxes payable 50,318 20,578
Other current liabilities, including liabilities
of
discontinued operations 112,256 71,140
Total current liabilities 345,837 235,094
Long-term debt, less current maturities 367,380 400,135
Deferred income taxes 110,230 117,335
Pension and postretirement benefit accruals 28,072 37,662
Other long-term liabilities 30,463 30,835
Shareholders' equity
Capital stock 13,610 13,543
Additional paid-in capital (175,157 ) (188,644 )
Accumulated other comprehensive loss (67,105 ) (24,599 )
Stock held in trust (1,934 ) (1,766 )
Deferred compensation liability 1,934 1,766
Retained earnings 968,373 947,070
Total shareholders' equity 739,721 747,370
Total liabilities and shareholders' equity $ 1,621,703 $ 1,568,431
Actuant Corporation
Condensed Consolidated Statements of Operations
(Dollars in thousands except per share amounts)
(Unaudited)
Three Months Ended Twelve Months Ended
August 31, August 31, August 31, August 31,
2010 2009 2010 2009
Net sales $ 310,362 $ 261,022 $ 1,160,508 $ 1,117,625
Cost of products sold 195,783 172,792 733,256 729,398
Gross profit 114,579 88,230 427,252 388,227
Selling, administrative and 68,853 59,557 267,866 250,004
engineering expenses
Restructuring charges 2,188 8,074 15,597 19,530
Impairment charges - - - 31,321
Amortization of intangible 5,946 5,358 22,017 19,644
assets
Operating profit 37,592 15,241 121,772 67,728
Financing costs, net 7,744 10,684 31,859 41,849
Other (income) expense, net 349 198 711 (714 )
Earnings from continuing
operations before income
tax expense 29,499 4,359 89,202 26,593
Income tax expense 8,590 423 18,846 611
Earnings from continuing 20,909 3,936 70,356 25,982
operations
Gain (loss) from
discontinued operations, net (37,723 ) 12,580 (46,325 ) (12,259 )
of income taxes
Net earnings (loss) $ (16,814 ) $ 16,516 $ 24,031 $ 13,723
Earnings from continuing
operations per share
Basic $ 0.31 $ 0.06 $ 1.04 $ 0.45
Diluted 0.29 0.06 0.97 0.43
Earnings (loss) per share
Basic $ (0.25 ) $ 0.26 $ 0.36 $ 0.24
Diluted (0.22 ) 0.24 0.35 0.24
Weighted average common
shares outstanding
Basic 67,716 63,742 67,624 58,047
Diluted 74,369 71,554 74,209 66,064
Actuant Corporation
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Three Months Ended Twelve Months Ended
August 31, August 31, August 31, August 31,
2010 2009 2010 2009
Operating Activities
Net earnings (loss) $ (16,814 ) $ 16,516 $ 24,031 $ 13,723
Adjustments to reconcile net
earnings (loss) to net cash
provided by
operating activities:
Depreciation and amortization 12,796 13,480 51,875 51,978
Stock-based compensation 2,355 2,208 8,399 8,609
expense
Amortization of debt discount 1,005 2,870 3,969 4,531
and debt issuance costs
Provision (benefit) for (3,558 ) 2,269 (2,876 ) (17,847 )
deferred income taxes
Impairment charges 36,139 - 36,139 58,274
Net gain on disposal of - (15,831 ) (334 ) (15,831 )
businesses
Other non-cash adjustments (148 ) 1,176 (855 ) 1,585
Changes in operating assets
and liabilities, excluding the
effects of
acquisitions and divestitures:
Accounts receivable 14,048 2,875 (14,507 ) 71,215
Expiration of accounts
receivable securitization - - (37,106 ) -
program
Inventories (4,065 ) 21,231 (7,964 ) 57,963
Prepaid expenses and other 1,445 252 3,817 1,075
assets
Trade accounts payable 8,047 6,090 32,727 (61,932 )
Income taxes payable 6,765 (1,987 ) 16,000 (9,180 )
Accrued compensation and 10,367 (1,189 ) 27,361 (25,836 )
benefits
Other accrued liabilities (16,870 ) (926 ) (19,590 ) 8,388
Net cash provided by operating 51,512 49,034 121,086 146,715
activities
Investing Activities
Proceeds from sale of 163 1,255 1,236 1,862
property, plant and equipment
Proceeds from sale of - 38,455 7,516 38,455
businesses
Capital expenditures (6,753 ) (6,436 ) (19,966 ) (21,454 )
Business acquisitions, net of (16,618 ) (3,500 ) (45,866 ) (239,422 )
cash acquired
Net cash provided by (used in) (23,208 ) 29,774 (57,080 ) (220,559 )
investing activities
Financing Activities
Net borrowings (repayments) on
revolving credit facilities
and
short-term borrowings (14,495 ) (79,542 ) (14,313 ) 16,657
Principal repayments on term - (113,562 ) - (270,000 )
loans
Proceeds from issuance of term - - - 115,000
loan
Proceeds from equity offering, 124,781 124,781
net of transaction costs
Open market repurchases of 2% - (9,100 ) (22,894 ) (9,100 )
Convertible Notes
Debt issuance costs - (3,825 ) - (9,158 )
Stock option exercises, 1,623 550 3,315 4,024
related tax benefits and other
Cash dividend - - (2,702 ) (2,251 )
Net cash used in financing (12,872 ) (80,698 ) (36,594 ) (30,047 )
activities
Effect of exchange rate 2,509 (17 ) 1,425 (7,273 )
changes on cash
Net increase (decrease) in 17,941 (1,907 ) 28,837 (111,164 )
cash and cash equivalents
Cash and cash equivalents - 22,281 13,292 11,385 122,549
beginning of period
Cash and cash equivalents - $ 40,222 $ 11,385 $ 40,222 $ 11,385
end of period
ACTUANT
CORPORATION
SUPPLEMENTAL UNAUDITED DATA FROM
CONTINUING OPERATIONS
(Dollars in
thousands)
FISCAL 2009 FISCAL 2010
Q1 Q2 Q3 Q4 TOTAL Q1 Q2 Q3 Q4 TOTAL
SALES
INDUSTRIAL $ $ $ $ $ 286,851 $ $ $ $ $ 299,983
SEGMENT 90,524 71,682 62,843 61,802 65,308 69,235 79,744 85,696
ENERGY SEGMENT 73,982 59,526 62,251 63,731 259,490 64,065 53,862 56,645 61,151 235,723
ELECTRICAL 67,383 59,629 56,218 58,758 241,988 54,065 54,927 61,967 62,743 233,702
SEGMENT
ENGINEERED
SOLUTIONS 103,385 72,872 76,308 76,731 329,296 89,202 89,414 111,712 100,772 391,100
SEGMENT
TOTAL $ $ $ $ $ $ $ $ $ $
335,274 263,709 257,620 261,022 1,117,625 272,640 267,438 310,068 310,362 1,160,508
% SALES GROWTH
INDUSTRIAL 4 % -18 % -38 % -37 % -23 % -28 % -3 % 27 % 39 % 5 %
SEGMENT
ENERGY SEGMENT 49 % 37 % 7 % 5 % 22 % -13 % -10 % -9 % -4 % -9 %
ELECTRICAL -22 % -29 % -34 % -21 % -27 % -20 % -8 % 10 % 7 % -3 %
SEGMENT
ENGINEERED
SOLUTIONS -23 % -44 % -47 % -37 % -38 % -14 % 23 % 46 % 31 % 19 %
SEGMENT
TOTAL -6 % -23 % -34 % -26 % -23 % -19 % 1 % 20 % 19 % 4 %
OPERATING
PROFIT (LOSS)
INDUSTRIAL $ $ $ $ $ 71,368 $ $ $ $ $ 72,182
SEGMENT 26,107 15,972 15,597 13,692 13,854 15,847 20,703 21,778
ENERGY SEGMENT 15,647 5,895 11,772 11,801 45,115 11,502 5,615 7,326 8,283 32,726
ELECTRICAL 4,935 2,663 3,856 3,559 15,012 4,073 5,539 7,309 7,446 24,367
SEGMENT
ENGINEERED
SOLUTIONS 7,865 (2,735 ) 991 342 6,463 5,481 6,007 13,554 10,242 35,284
SEGMENT
CORPORATE / (3,197 ) (5,013 ) (4,815 ) (5,042 ) (18,066 ) (5,471 ) (5,561 ) (7,351 ) (7,710 ) (26,093 )
GENERAL
TOTAL -
EXCLUDING $ $ $ $ $ 119,892 $ $ $ $ $ 138,466
RESTRUCTURING 51,357 16,782 27,401 24,352 29,439 27,447 41,541 40,039
CHARGES
RESTRUCTURING (674 ) (2,564 ) (8,494 ) (9,111 ) (20,843 ) (2,831 ) (9,968 ) (1,448 ) (2,447 ) (16,694 )
CHARGES
IMPAIRMENT (26,553 ) - (4,768 ) - (31,321 ) - - - - -
CHARGES
TOTAL $ $ $ $ $ 67,728 $ $ $ $ $ 121,772
24,130 14,218 14,139 15,241 26,608 17,479 40,093 37,592
OPERATING
PROFIT %
INDUSTRIAL 28.8 % 22.3 % 24.8 % 22.2 % 24.9 % 21.2 % 22.9 % 26.0 % 25.4 % 24.1 %
SEGMENT
ENERGY SEGMENT 21.1 % 9.9 % 18.9 % 18.5 % 17.4 % 18.0 % 10.4 % 12.9 % 13.5 % 13.9 %
ELECTRICAL 7.3 % 4.5 % 6.9 % 6.1 % 6.2 % 7.5 % 10.1 % 11.8 % 11.9 % 10.4 %
SEGMENT
ENGINEERED
SOLUTIONS 7.6 % -3.8 % 1.3 % 0.4 % 2.0 % 6.1 % 6.7 % 12.1 % 10.2 % 9.0 %
SEGMENT
TOTAL
(INCLUDING
CORPORATE) - 15.3 % 6.4 % 10.6 % 9.3 % 10.7 % 10.8 % 10.3 % 13.4 % 12.9 % 11.9 %
EXCLUDING
RESTRUCTURING
CHARGES
EBITDA
INDUSTRIAL $ $ $ $ $ 77,727 $ $ $ $ $ 78,172
SEGMENT 27,139 17,058 18,208 15,322 15,633 16,639 21,632 24,268
ENERGY SEGMENT 21,671 11,492 15,080 16,235 64,478 15,493 10,072 11,353 11,731 48,649
ELECTRICAL 6,438 4,113 5,494 5,186 21,231 5,675 6,988 8,632 8,876 30,171
SEGMENT
ENGINEERED
SOLUTIONS 12,417 1,274 3,879 4,953 22,524 8,981 10,168 17,373 14,379 50,901
SEGMENT
CORPORATE / (3,110 ) (4,058 ) (4,237 ) (4,196 ) (15,601 ) (4,771 ) (4,339 ) (6,542 ) (7,252 ) (22,904 )
GENERAL
TOTAL -
EXCLUDING $ $ $ $ $ 170,358 $ $ $ $ $ 184,989
RESTRUCTURING 64,555 29,879 38,424 37,500 41,011 39,528 52,448 52,002
CHARGES
RESTRUCTURING (674 ) (2,564 ) (8,494 ) (9,111 ) (20,843 ) (2,831 ) (9,968 ) (1,448 ) (2,447 ) (16,694 )
CHARGES
IMPAIRMENT (26,553 ) - (4,768 ) - (31,321 ) - - - - -
CHARGES
TOTAL $ $ $ $ $ 118,194 $ $ $ $ $ 168,295
37,328 27,315 25,162 28,389 38,180 29,560 51,000 49,555
`
EBITDA %
INDUSTRIAL 30.0 % 23.8 % 29.0 % 24.8 % 27.1 % 23.9 % 24.0 % 27.1 % 28.3 % 26.1 %
SEGMENT
ENERGY SEGMENT 29.3 % 19.3 % 24.2 % 25.5 % 24.8 % 24.2 % 18.7 % 20.0 % 19.2 % 20.6 %
ELECTRICAL 9.6 % 6.9 % 9.8 % 8.8 % 8.8 % 10.5 % 12.7 % 13.9 % 14.1 % 12.9 %
SEGMENT
ENGINEERED
SOLUTIONS 12.0 % 1.7 % 5.1 % 6.5 % 6.8 % 10.1 % 11.4 % 15.6 % 14.3 % 13.0 %
SEGMENT
TOTAL
(INCLUDING
CORPORATE) - 19.3 % 11.3 % 14.9 % 14.4 % 15.2 % 15.0 % 14.8 % 16.9 % 16.8 % 15.9 %
EXCLUDING
RESTRUCTURING
CHARGES
ACTUANT
CORPORATION
RECONCILIATION OF
GAAP MEASURES TO
NON-GAAP MEASURES
(Dollars in
thousands, FISCAL 2009 FISCAL 2010
except for per
share amounts)
Q1 Q2 Q3 Q4 TOTAL Q1 Q2 Q3 Q4 TOTAL
OPERATING PROFIT
(LOSS), EXCLUDING
RESTRUCTURING
CHARGES
AND IMPAIRMENT
CHARGES
INDUSTRIAL
SEGMENT
OPERATING $ $ $ $ $ $ $ $ $ $
PROFIT (GAAP 26,007 15,545 14,633 11,266 67,451 13,676 10,937 20,374 21,357 66,344
MEASURE)
RESTRUCTURING 100 427 964 2,426 3,917 178 4,910 329 421 5,838
CHARGES
ADJUSTED
OPERATING $ $ $ $ $ $ $ $ $ $
PROFIT 26,107 15,972 15,597 13,692 71,368 13,854 15,847 20,703 21,778 72,182
(NON-GAAP
MEASURE)
ENERGY SEGMENT
OPERATING $ $ $ $ $ $ $ $ $
PROFIT (GAAP 15,533 5,976 11,508 11,075 44,092 11,359 3,922 7,203 $ 8,218 30,702
MEASURE)
RESTRUCTURING 114 (81 ) 264 726 1,023 143 1,693 123 65 2,024
CHARGES
ADJUSTED
OPERATING $ $ $ $ $ $ $ $ $
PROFIT 15,647 5,895 11,772 11,801 45,115 11,502 5,615 7,326 $ 8,283 32,726
(NON-GAAP
MEASURE)
ELECTRICAL
SEGMENT
OPERATING $ $ $ $ $ $
PROFIT (LOSS) $ 4,900 1,959 (4,293 ) $ 762 $ 3,327 2,186 4,373 6,775 $ 6,519 19,853
(GAAP MEASURE)
RESTRUCTURING 35 704 3,381 2,797 6,917 1,887 1,166 534 927 4,514
CHARGES
IMPAIRMENT - - 4,768 - 4,768 - - - - -
CHARGE
ADJUSTED
OPERATING $ $ $ $ $ $
PROFIT $ 4,935 2,663 $ 3,856 $ 3,559 15,012 4,073 5,539 7,309 $ 7,446 24,367
(NON-GAAP
MEASURE)
ENGINEERED
SOLUTIONS
OPERATING $ $ $ $ $ $ $ $ $
PROFIT (LOSS) (19,113 ) (3,985 ) (2,670 ) (2,664 ) (28,432 ) 5,053 3,995 13,170 $ 9,463 31,681
(GAAP MEASURE)
RESTRUCTURING 425 1,250 3,661 3,006 8,342 428 2,012 384 779 3,603
CHARGES
IMPAIRMENT 26,553 - - - 26,553 - - - - -
CHARGE
ADJUSTED
OPERATING $ $ $ $ $ $
PROFIT (LOSS) $ 7,865 (2,735 ) $ 991 $ 342 $ 6,463 5,481 6,007 13,554 10,242 35,284
(NON-GAAP
MEASURE)
CORPORATE
OPERATING LOSS $ ) $ ) $ ) $ ) $ ) $ ) $ ) $ ) $ ) $ )
(GAAP MEASURE) (3,197 (5,277 (5,039 (5,198 (18,710 (5,666 (5,748 (7,429 (7,965 (26,808
RESTRUCTURING - 264 224 156 644 195 187 78 255 715
CHARGES
ADJUSTED
OPERATING LOSS $ ) $ ) $ ) $ ) $ ) $ ) $ ) $ ) $ ) $ )
(NON-GAAP (3,197 (5,013 (4,815 (5,042 (18,066 (5,471 (5,561 (7,351 (7,710 (26,093
MEASURE)
NET EARNINGS
(LOSS), EXCLUDING
RESTRUCTURING
CHARGES,
IMPAIRMENT
CHARGES, INCOME
TAX ADJUSTMENTS,
DEBT
EXTINGUISHMENT
CHARGES AND
DISCONTINUED
OPERATIONS (2)
NET EARNINGS $ $ $ $ $ $ $ $ $ $
(LOSS) (GAAP 11,598 3,244 (17,635 ) 16,516 13,723 11,854 7,157 21,835 (16,814 ) 24,031
MEASURE)
RESTRUCTURING
CHARGES, NET 481 1,553 4,920 6,055 13,009 1,804 6,863 1,069 1,938 11,674
OF TAX BENEFIT
IMPAIRMENT
CHARGES, NET 16,463 - 2,981 - 19,444 - - - - -
OF TAX BENEFIT
INCOME TAX - - - - - - - 632 - 632
ADJUSTMENTS
DEBT
EXTINGUISHMENT (236 ) - - 1,303 1,067 - - - - -
CHARGES, NET
OF TAX BENEFIT
DISCONTINUED
OPERATIONS, 30 1,864 22,945 (12,580 ) 12,259 1,406 738 1,853 37,723 41,720
NET OF TAX
BENEFIT
TOTAL $ $ $ $ $ $ $ $ $ $
(NON-GAAP 28,336 6,661 13,211 11,294 59,502 15,064 14,758 25,389 22,847 78,057
MEASURE)
DILUTED EARNINGS
(LOSS) PER SHARE,
EXCLUDING
RESTRUCTURING
CHARGES,
IMPAIRMENT
CHARGES, INCOME
TAX ADJUSTMENTS,
DEBT
EXTINGUISHMENT
CHARGES AND
DISCONTINUED
OPERATIONS (2)
NET EARNINGS
(LOSS) (GAAP $ 0.19 $ 0.06 $ (0.27 ) $ 0.24 $ 0.24 $ 0.17 $ 0.10 $ 0.30 $ (0.22 ) $ 0.35
MEASURE)
RESTRUCTURING
CHARGES, NET 0.01 0.02 0.08 0.09 0.20 0.02 0.10 0.01 0.02 0.16
OF TAX BENEFIT
IMPAIRMENT
CHARGES, NET 0.26 - 0.05 - 0.29 - - - - -
OF TAX BENEFIT
INCOME TAX - - - - - - - 0.01 - 0.01
ADJUSTMENTS
DEBT
EXTINGUISHMENT (0.00 ) - - 0.02 0.02 - - - - -
CHARGES, NET
OF TAX BENEFIT
DISCONTINUED
OPERATIONS, - 0.03 0.36 (0.18 ) 0.19 0.02 0.01 0.03 0.51 0.56
NET OF TAX
BENEFIT
TOTAL
(NON-GAAP $ 0.45 $ 0.11 $ 0.22 $ 0.17 $ 0.94 $ 0.21 $ 0.21 $ 0.35 $ 0.31 $ 1.08
MEASURE)
EBITDA (3)
NET EARNINGS $ $ $ $ $ $ $ $ $ $
(LOSS) (GAAP 11,598 3,244 (17,635 ) 16,516 13,723 11,854 7,157 21,835 (16,814 ) 24,031
MEASURE)
FINANCING 12,235 9,904 9,026 10,684 41,849 8,538 7,798 7,779 7,744 31,859
COSTS, NET
INCOME TAX 1,487 (15 ) (1,284 ) 423 611 4,529 2,020 3,706 8,590 18,846
EXPENSE
DEPRECIATION & 11,978 12,318 12,110 13,346 49,752 11,853 11,847 11,222 12,312 47,234
AMORTIZATION
DISCONTINUED
OPERATIONS, 30 1,864 22,945 (12,580 ) 12,259 1,406 738 6,458 37,723 46,325
NET OF TAX
BENEFIT
EBITDA $ $ $ $ $ $ $ $ $ $
(NON-GAAP 37,328 27,315 25,162 28,389 118,194 38,180 29,560 51,000 49,555 168,295
MEASURE)
IMPAIRMENT 26,553 - 4,768 - 31,321 - - - - -
CHARGES
RESTRUCTURING 674 2,564 8,494 9,111 20,843 2,831 9,968 1,448 2,447 16,694
CHARGES
EBITDA
(NON-GAAP
MEASURE) -
EXCLUDING
DISCONTINUED
OPERATIONS,
IMPAIRMENT AND $ $ $ $ $ $ $ $ $ $
RESTRUCTURING 64,555 29,879 38,424 37,500 170,358 41,011 39,528 52,448 52,002 184,989
CHARGES
ACTUANT CORPORATION
FOOTNOTES FOR SUPPLEMENTAL UNAUDITED DATA AND
RECONCILIATION OF GAAP MEASURES TO NON-GAAP
MEASURES
(Dollars in
thousands,
except for per
share amounts)
FOOTNOTES
The total of the
individual
NOTE: quarters may not
equal the annual
total due to
rounding.
A summary of restructuring charges
(1) included in cost of products sold is as
follows:
FISCAL 2009 FISCAL 2010
Q1 Q2 Q3 Q4 TOTAL Q1 Q2 Q3 Q4 TOTAL
Restructuring $ $ $ $ $ $ $ $ $ $
- cost of - - 276 1,037 1,313 54 692 92 259 1,097
products sold
(2) Net earnings and diluted earnings per share excluding restructuring charges, impairment charges, income tax adjustments, debt extinguishment charges and discontinued operations represent net earnings and diluted earnings per share per the Condensed Consolidated Statements of Earnings net of charges or credits for items to be highlighted for comparability purposes. These measures should not be considered as an alternative to net earnings or diluted earnings per share as an indicator of the Company's operating performance. However, this presentation is important to investors for understanding the operating results of the current portfolio of Actuant companies. The total of the individual components may not equal due to rounding.
(3) EBITDA represents net earnings before financing costs, net, income tax expense, depreciation & amortization and discontinued operations. EBITDA is not a calculation based upon generally accepted accounting principles (GAAP). The amounts included in the EBITDA calculation, however, are derived from amounts included in the Condensed Consolidated Statements of Earnings data. EBITDA should not be considered as an alternative to net earnings or operating profit as an indicator of the Company's operating performance, or as an alternative to operating cash flows as a measure of liquidity. Actuant has presented EBITDA because it regularly reviews this as a measure of the company's ability to incur and service debt. In addition, EBITDA is used by many of our investors and lenders, and is presented as a convenience to them. However, the EBITDA measure presented may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation. The total of the individual quarters may not equal the annual total due to rounding.
Source: Actuant Corporation
Released September 29, 2010