Twin Disc, Inc. Announces Fiscal 2012 Third Quarter Financial Results
- Fiscal 2012 Third Quarter Net Earnings Increase 106.5% Year-over-Year
- Fiscal 2012 Third Quarter Sales Up 24.9% Year-over-Year
Sales for the fiscal 2012 third quarter improved to
Gross margin for the fiscal 2012 third quarter was 34.6 percent, compared to 36.3 percent in the fiscal 2011 third quarter and 35.6 percent in the fiscal 2012 second quarter. The year-over-year and sequential decline in the fiscal 2012 third-quarter gross margin was the result of a change in the mix of sales. Year-to-date, gross margin was 36.0 percent, compared to 33.6 percent for the fiscal 2011 nine month period.
For the fiscal 2012 third quarter, marketing, engineering and
administrative (ME&A) expenses, as a percentage of sales, were 18.6
percent, compared to 22.3 percent for the fiscal 2011 third quarter.
ME&A expenses increased
Year-to-date, ME&A expenses, as a percentage of sales, were 20.7
percent, compared to 23.7 percent for the fiscal 2011 first nine months.
For the fiscal 2012 nine-month period, ME&A expenses increased
Other expense of
The effective tax rate for the fiscal 2012 third quarter was 36.4
percent, compared to the prior year's third quarter tax rate of 55.1
percent. The effective tax rate for the first nine months of fiscal 2012
was 36.0 percent, compared to 40.4 percent for the same period last
fiscal year. In the third quarter of fiscal 2011, the rate was
unfavorably impacted by the recording of a valuation allowance against
the net deferred tax asset at a foreign jurisdiction, resulting in
additional tax expense of approximately
Net earnings attributable to
Earnings before interest, taxes, depreciation and amortization (EBITDA)*
was
Commenting on the results,
"With one quarter remaining in fiscal 2012, we are confident we will
achieve many financial and operating milestones for the year. As we look
to fiscal 2013, we expect it to be another good year but down from the
record levels we have experienced in fiscal 2012. While changes in the
oil and gas landscape have caused our near-term outlook to be cautious,
The conference call will also be broadcast live over the Internet. To
listen to the call via the Internet, access
About
Forward-Looking Statements
This press release may contain statements that are forward looking as
defined by the
*Non-GAAP Financial Disclosures
Financial information excluding the impact of foreign currency exchange rate changes and the impact of acquisitions, if any, in this press release are not measures that are defined in U.S. Generally Accepted Accounting Principles ("GAAP"). These items are measures that management believes are important to adjust for in order to have a meaningful comparison to prior and future periods and to provide a basis for future projections and for estimating our earnings growth prospects. Non-GAAP measures are used by management as a performance measure to judge profitability of our business absent the impact of foreign currency exchange rate changes and acquisitions. Management analyzes the company's business performance and trends excluding these amounts. These measures, as well as EBITDA, provide a more consistent view of performance than the closest GAAP equivalent for management and investors. Management compensates for this by using these measures in combination with the GAAP measures. The presentation of the non-GAAP measures in this press release are made alongside the most directly comparable GAAP measures.
Definition — Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
The sum of, net earnings and adding back provision for income taxes, interest expense, depreciation and amortization expenses: this is a financial measure of the profit generated excluding the above mentioned items.
--Financial Results Follow--
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND |
|||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
March 30, |
March 25, |
March 30, |
March 25, |
||||||||||||
Net sales | $ | 95,490 | $ | 76,471 | $ | 259,761 | $ | 213,026 | |||||||
Cost of goods sold | 62,434 | 48,689 | 166,375 | 141,464 | |||||||||||
Gross profit | 33,056 | 27,782 | 93,386 | 71,562 | |||||||||||
Marketing, engineering and administrative expenses |
17,746 | 17,054 | 53,752 | 50,470 | |||||||||||
Earnings from operations | 15,310 | 10,728 | 39,634 | 21,092 | |||||||||||
Interest expense | 389 | 430 | 1,129 | 1,309 | |||||||||||
Other expense (income), net | 71 | 193 | (473 | ) | 836 | ||||||||||
Earnings before income taxes and noncontrolling interest |
14,850 |
10,105 |
38,978 |
18,947 |
|||||||||||
Income taxes | 5,412 | 5,563 | 14,039 | 7,648 | |||||||||||
Net earnings | 9,438 | 4,542 | 24,939 | 11,299 | |||||||||||
|
|||||||||||||||
Less: Net (earnings) loss attributable to noncontrolling interest, net of tax |
(45 | ) | 6 | (108 | ) | (61 | ) | ||||||||
Net earnings attributable to |
$ | 9,393 | $ | 4,548 | $ | 24,831 | $ | 11,238 | |||||||
Earnings per share data: | |||||||||||||||
|
$ |
0.82 |
$ |
0.40 |
$ |
2.18 |
$ |
0.99 |
|||||||
Diluted earnings per share attributable to |
$ |
0.81 |
$ |
0.40 |
$ |
2.15 |
$ |
0.98 |
|||||||
Weighted average shares outstanding data: | |||||||||||||||
|
11,426 | 11,344 | 11,410 | 11,308 | |||||||||||
Diluted shares outstanding | 11,572 | 11,474 | 11,555 | 11,425 | |||||||||||
Dividends per share | $ | 0.09 | $ | 0.08 | $ | 0.25 | $ | 0.22 | |||||||
Comprehensive income: | |||||||||||||||
Net earnings | $ | 9,438 | $ | 4,542 | $ | 24,939 | $ | 11,299 | |||||||
Other comprehensive income (loss): | |||||||||||||||
Foreign currency translation adjustment | 2,241 | 4,551 | (6,292 | ) | 14,776 | ||||||||||
Benefit plan adjustments, net | 418 | 545 | 1,303 | 1,665 | |||||||||||
Comprehensive income | 12,097 | 9,638 | 19,950 | 27,740 | |||||||||||
Comprehensive (income) loss attributable to noncontrolling interest |
(45 |
) |
6 |
|
(108 |
) |
(61 |
) |
|||||||
Comprehensive income attributable to |
$ |
12,052 |
$ |
9,644 |
$ |
19,842 |
$ |
27,679 |
|||||||
RECONCILIATION OF CONSOLIDATED NET EARNINGS TO EBITDA |
||||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||||
March 30, |
March 25, |
March 30, |
March 25, |
|||||||||
Net earnings attributable to |
$ | 9,393 | $ | 4,548 | $ | 24,831 | $ | 11,238 | ||||
Interest expense | 389 | 430 | 1,129 | 1,309 | ||||||||
Income taxes | 5,412 | 5,563 | 14,039 | 7,648 | ||||||||
Depreciation and amortization | 2,699 | 2,365 | 8,010 | 6,983 | ||||||||
Earnings before interest, taxes, depreciation and amortization |
$ | 17,893 | $ | 12,906 | $ | 48,009 | $ | 27,178 | ||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
(In thousands; unaudited) | ||||||||
|
June 30, | |||||||
2012 |
2011 |
|||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash | $ | 17,628 | $ | 20,167 | ||||
Trade accounts receivable, net | 67,675 | 61,007 | ||||||
Inventories, net | 117,749 | 99,139 | ||||||
Deferred income taxes | 5,942 | 5,765 | ||||||
Other | 9,523 | 9,090 | ||||||
Total current assets | 218,517 | 195,168 | ||||||
Property, plant and equipment, net | 67,161 | 65,791 | ||||||
Goodwill, net | 17,332 | 17,871 | ||||||
Deferred income taxes | 9,159 | 16,480 | ||||||
Intangible assets, net | 5,514 | 6,439 | ||||||
Other assets | 7,678 | 7,371 | ||||||
TOTAL ASSETS | $ | 325,361 | $ | 309,120 | ||||
LIABILITIES AND EQUITY | ||||||||
Current liabilities: | ||||||||
Short-term borrowings and current maturities of long-term debt | $ | 3,789 | $ | 3,915 | ||||
Accounts payable | 30,986 | 38,372 | ||||||
Accrued liabilities | 38,637 | 41,673 | ||||||
Total current liabilities | 73,412 | 83,960 | ||||||
Long-term debt | 41,319 | 25,784 | ||||||
Accrued retirement benefits | 45,261 | 50,063 | ||||||
Deferred income taxes | 3,660 | 4,170 | ||||||
Other long-term liabilities | 4,478 | 7,089 | ||||||
Total liabilities | 168,130 | 171,066 | ||||||
|
||||||||
Common shares authorized: 30,000,000; | ||||||||
Issued: 13,099,468; no par value | 12,181 | 10,863 | ||||||
Retained earnings | 184,831 | 162,857 | ||||||
Accumulated other comprehensive loss | (16,430 | ) | (11,383 | ) | ||||
180,582 | 162,337 | |||||||
Less treasury stock, at cost | ||||||||
(1,669,981 and 1,739,574 shares, respectively) | 24,356 | 25,252 | ||||||
Total |
156,226 | 137,085 | ||||||
Noncontrolling interest | 1,005 | 969 | ||||||
Total equity | 157,231 | 138,054 | ||||||
TOTAL LIABILITIES AND EQUITY | $ | 325,361 | $ | 309,120 | ||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
Nine Months Ended | ||||||||
March 30,
2012 |
March 25,
2011 |
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
Net earnings | $ | 24,939 | $ | 11,299 | ||||
Adjustments to reconcile to net earnings to net cash (used) | ||||||||
provided by operating activities: | ||||||||
Depreciation and amortization | 8,010 | 6,983 | ||||||
Other non-cash changes, net | 4,557 | 5,537 | ||||||
Net change in working capital, excluding cash | (41,315 | ) | (19,753 | ) | ||||
Net cash (used) provided by operating activities | (3,809 | ) | 4,066 | |||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
Acquisitions of fixed assets | (10,560 | ) | (4,099 | ) | ||||
Proceeds from sale of fixed assets | 95 | 58 | ||||||
Other, net | (293 | ) | (293 | ) | ||||
Net cash used by investing activities | (10,758 | ) | (4,334 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
Proceeds from notes payable | - | 19 | ||||||
Payments of notes payable | (109 | ) | (82 | ) | ||||
Proceeds from (payments of) long-term debt, net | 15,543 | (352 | ) | |||||
Proceeds from exercise of stock options | 169 | 203 | ||||||
Dividends paid to shareholders | (2,857 | ) | (2,494 | ) | ||||
Dividends paid to noncontrolling interest | (130 | ) | (137 | ) | ||||
Other | 350 | 223 | ||||||
Net cash provided (used) by financing activities | 12,966 | (2,620 | ) | |||||
Effect of exchange rate changes on cash | (938 | ) | 2,365 | |||||
Net change in cash | (2,539 | ) | (523 | ) | ||||
Cash: | ||||||||
Beginning of period | 20,167 | 19,022 | ||||||
End of period | $ | 17,628 | $ | 18,499 | ||||
Source:
News Provided by Acquire Media