EXHIBIT 99.1
PRESS RELEASE
Contact: | Frederic M. Burditt | |||||
Chief Financial Officer | ||||||
CIRCOR International | ||||||
(781) 270-1200 |
CIRCOR Announces Fourth Quarter Earnings of $0.60 per share
• | Fourth quarter earnings excluding net charges total $0.66 per share, up 3% over prior year |
• | Company establishes reserve for existing asbestos claims and records gain on sale of land in China |
• | Outlook for 2008 continues to show growth as Energy, Aerospace and Industrial markets and backlog remain strong |
Burlington, MA, February 20, 2008
CIRCOR International, Inc. (NYSE: CIR), a leading provider of valves and other fluid control devices for the instrumentation, aerospace, thermal fluid and energy markets, today announced results for the fourth quarter and 12 months ended December 31, 2007.
Revenues for the 2007 fourth quarter were $174.5 million, an increase of 3% from $169.6 million for the fourth quarter 2006 period. Net income for the fourth quarter of 2007 was $10.1 million, or $0.60 per diluted share, compared to $10.4 million, or $0.63 per diluted share, for the fourth quarter of 2006. Net income for the fourth quarter of 2007 includes net pre-tax charges of $1.6 million, or $0.06 per diluted share: (i) a $0.10 per share charge to accrue estimated indemnity costs associated with open asbestos claims affecting the Company’s Leslie Controls subsidiary; (ii) $0.01 per diluted share for a charge related to accelerated vesting of equity awards for retiring executives; and (iii) $0.05 per share from a gain on sale of the Company’s former location in China.
For the 12 months ended December 31, 2007, revenues were $665.7 million, an increase of 13% from $591.7 million for 2006. Net income for the 12 months of 2007 was $37.9 million, or $2.27 per diluted share, an increase of 26% from $29.3 million, or $1.80 per diluted share, in the same period last year. Results for the 12 months of 2007 include net pre-tax charges of $3.3 million, or $0.15 per diluted share: (i) $0.11 per diluted share for charge from accelerated vesting of equity awards for the Company’s retiring executives; (ii) $0.10 per diluted share for charge to accrue estimated indemnity costs associated with open asbestos claims affecting the Company’s Leslie Controls subsidiary; (iii) $0.05 per diluted share for charges related to facility
consolidation; (iv) $0.06 per diluted share from gain on sale of an unrelated business; and (v) $0.05 per diluted share from gain on sale of a former Chinese manufacturing site.
The Company received orders totaling $170.4 million during the fourth quarter of 2007, increasing 1% over the fourth quarter of 2006, and an 8% decrease from the third quarter of 2007. For the 12 months of 2007, orders totaled $771.7 million with year-end backlog remaining at a near record level of $391.6 million, representing increases of 9% and 37%, respectively, over 2006.
During the fourth quarter of 2007, the Company generated $28.0 million of free cash flow (defined as net cash from operating activities, less capital expenditures and dividends paid) and, for the 12 months of 2007, the Company had positive free cash flow of $42.5 million despite higher working capital needed to support the Company’s record orders and its 37% increase in backlog. This compares favorably to the 12 months of 2006 during which the Company generated $17.5 million of free cash flow. The improvement in 2007 largely resulted from reduced working capital and an increase in profitability as compared to 2006.
Circor’s Instrumentation and Thermal Fluid Controls Products segment revenues increased 12% to $91.5 million from $81.6 million in the fourth quarter of 2006. Incoming orders for this segment were $93.1 million, up 26%, while this segment’s backlog at December 31, 2007, reached a record $136.7 million, a 21% increase from one year ago, and a 1% increase from the end of the third quarter of 2007. This segment’s operating margin for the fourth quarter was 8.3% compared to the 8.2% operating margin achieved in the fourth quarter of 2006. Excluding special charges and the accrual for estimated indemnity costs associated with open asbestos claims affecting the Company’s Leslie Controls subsidiary, the fourth quarter 2007 operating margin was 11.2% which represented a 300 basis point increase from the third quarter of 2007, reflecting improved manufacturing efficiencies and lower inventory costs from foreign-sourcing.
During the fourth quarter of 2007, the Company’s Leslie Controls subsidiary, whose results are reported in Circor’s Instrumentation and Thermal Fluid Controls Segment, recorded an additional liability of $9.0 million for the estimated indemnity cost associated with resolution of its current open claims for asbestos-related litigation. The recording of this liability resulted in a pre-tax charge of $2.6 million, or $0.10 per share, net of insurance recoveries.
Circor’s Energy Products segment revenues decreased 6% to $83.1 million from its record level of $88.0 million in the fourth quarter of 2006. Incoming orders for the quarter were $77.3 million and ending backlog totaled another record at $254.8 million compared to incoming orders of $95.4 million and ending backlog of $172.2 million in the same periods last year. This segment’s operating margin was 16.7% during the fourth quarter of 2007 compared to 15.4% for the fourth quarter of 2006.
Bill Higgins, Circor’s Chief Executive Officer-elect, said, “As expected, our Energy Products business experienced some softening in market activities this quarter from record levels, as distributor inventories in North America caught up with demand and, globally, project awards returned to more normal levels. Prospects in 2008 remain healthy as this segment’s backlog remains at near record levels.”
Mr. Higgins continued, “Results for our Instrumentation and Thermal Fluid Control Products segment were encouraging. Incoming order rates improved in all primary markets including steam, instrumentation and general aerospace. We continue to make progress with lean manufacturing and global outsourcing initiatives to drive profit improvement within this segment, and expect to more fully realize cost reduction benefits throughout 2008. Some selective pricing increases have been successfully instituted as well. These improvements have been partially offset by higher legal costs associated with Leslie Controls’ asbestos claims.”
Circor provided guidance for its first quarter 2008 results, indicating it expects earnings to be in the range of $0.54 to $0.58 per diluted share, including an expected $0.02 special charge related to facility closures. The guidance compares to earnings in the first quarter of 2007 of $0.45 per diluted share, which included $0.03 per share for a facility consolidation.
CIRCOR International has scheduled a conference call to review its results for the fourth quarter of 2007 tomorrow, February 21, 2008, at 10:30 am ET. Interested parties may access the call by dialing (888) 256-9119 from the US and Canada and (913) 312-6693 from international locations. A replay of the call will be available from 1:30 pm ET on February 21, 2008, through 1:30 pm ET on February 28, 2008. To access the replay, interested parties should dial (888) 203-1112 or (719) 457-0820 and enter confirmation code # 2840279 when prompted. The presentation slides that will be discussed in the conference call are expected to be available on Wednesday, February 20, 2008, by 6:00 pm ET. The presentation slides may be downloaded from the quarterly earnings page of the investor section on the CIRCOR website: http://www.circor.com/quarterlyearnings/. An audio recording of the conference call also is expected to be posted on the company’s website by February 25, 2008.
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Reliance should not be placed on forward-looking statements because they involve unknown risks, uncertainties and other factors, which are, in some cases, beyond the control of CIRCOR. Actual events, performance or results could differ materially from the anticipated events, performance or results expressed or implied by such forward-looking statements. BEFORE MAKING ANY INVESTMENT DECISIONS REGARDING OUR COMPANY, WE STRONGLY ADVISE YOU TO READ THE SECTION ENTITLED “RISK FACTORS” IN OUR MOST RECENT ANNUAL REPORT ON FORM 10-K, WHICH CAN BE ACCESSED UNDER THE “INVESTORS” LINK OF OUR WEBSITE AT WWW.CIRCOR.COM. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
CIRCOR INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
UNAUDITED
Three Months Ended | Year Ended | |||||||||||||||
Dec 31, 2007 | Dec 31, 2006 | Dec 31, 2007 | Dec 31, 2006 | |||||||||||||
Net revenues | $ | 174,523 | $ | 169,615 | $ | 665,740 | $ | 591,711 | ||||||||
Cost of revenues | 121,320 | 120,643 | 470,373 | 418,803 | ||||||||||||
GROSS PROFIT | 53,203 | 48,972 | 195,367 | 172,908 | ||||||||||||
Selling, general and administrative expenses | 37,951 | 32,641 | 136,086 | 124,720 | ||||||||||||
Special charges (income), net | (922 | ) | 200 | 2,514 | 678 | |||||||||||
OPERATING INCOME | 16,174 | 16,131 | 56,767 | 47,510 | ||||||||||||
Other (income) expense: | ||||||||||||||||
Interest income | (134 | ) | (97 | ) | (393 | ) | (429 | ) | ||||||||
Interest expense | 289 | 1,342 | 3,394 | 5,546 | ||||||||||||
Other (income) expense, net | 133 | 487 | (1,257 | ) | 134 | |||||||||||
Total other expense | 288 | 1,732 | 1,744 | 5,251 | ||||||||||||
INCOME BEFORE INCOME TAXES | 15,886 | 14,399 | 55,023 | 42,259 | ||||||||||||
Provision for income taxes | 5,765 | 4,016 | 17,112 | 12,931 | ||||||||||||
NET INCOME | $ | 10,121 | $ | 10,383 | $ | 37,911 | $ | 29,328 | ||||||||
Earnings per common share: | ||||||||||||||||
Basic | $ | 0.61 | $ | 0.65 | $ | 2.31 | $ | 1.84 | ||||||||
Diluted | $ | 0.60 | $ | 0.63 | $ | 2.27 | $ | 1.80 | ||||||||
Weighted average common shares outstanding: | ||||||||||||||||
Basic | 16,646 | 16,076 | 16,442 | 15,976 | ||||||||||||
Diluted | 16,925 | 16,438 | 16,730 | 16,291 |
CIRCOR INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
UNAUDITED
Year Ended | ||||||||
Dec 31, 2007 | Dec 31, 2006 | |||||||
OPERATING ACTIVITIES | ||||||||
Net income | $ | 37,911 | $ | 29,328 | ||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
Depreciation | 10,870 | 11,206 | ||||||
Amortization | 2,579 | 2,394 | ||||||
Compensation expense of stock-based plans | 5,704 | 3,252 | ||||||
Tax effect of share based compensation | (3,623 | ) | — | |||||
Deferred income taxes | (3,574 | ) | (4,708 | ) | ||||
(Gain) Loss on sale of assets held for sale | (1,229 | ) | — | |||||
(Gain) Loss on sale of property, plant and equipment | 102 | 91 | ||||||
Gain on sale of affiliate | (1,605 | ) | (11 | ) | ||||
Equity earnings and paid dividends of affiliate, net | 452 | — | ||||||
Changes in operating assets and liabilities, net of effects from business acquisitions: | ||||||||
Trade accounts receivable | (12,532 | ) | (20,857 | ) | ||||
Inventories | (15,672 | ) | (29,804 | ) | ||||
Prepaid expenses and other assets | (13,187 | ) | 4,966 | |||||
Accounts payable, accrued expenses and other liabilities | 50,720 | 34,001 | ||||||
Net cash provided by operating activities | 56,916 | 29,858 | ||||||
INVESTING ACTIVITIES | ||||||||
Additions to property, plant and equipment | (11,983 | ) | (9,933 | ) | ||||
Proceeds from disposal or sale of property, plant and equipment | 939 | 371 | ||||||
Proceeds from sale of assets held for sale | 4,072 | 100 | ||||||
Business acquisitions, net of cash acquired | (2,704 | ) | (61,103 | ) | ||||
Proceeds from sale of affiliate | 1,605 | 2,309 | ||||||
Purchase of investments | (8,760 | ) | (12,194 | ) | ||||
Proceeds from sale of investments | — | 12,211 | ||||||
Net cash used in investing activities | (16,831 | ) | (68,239 | ) | ||||
FINANCING ACTIVITIES | ||||||||
Proceeds from debt borrowings | 87,641 | 100,561 | ||||||
Payments of debt | (130,709 | ) | (70,204 | ) | ||||
Dividends paid | (2,464 | ) | (2,395 | ) | ||||
Proceeds from the exercise of stock options | 6,380 | 3,627 | ||||||
Tax effect of share based compensation | 3,623 | 2,559 | ||||||
Net cash (used in) provided by financing activities | (35,529 | ) | 34,148 | |||||
Effect of exchange rate changes on cash and cash equivalents | 1,454 | 1,773 | ||||||
INCREASE IN CASH AND CASH EQUIVALENTS | 6,010 | (2,460 | ) | |||||
Cash and cash equivalents at beginning of year | 28,652 | 31,112 | ||||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ | 34,662 | $ | 28,652 | ||||
CIRCOR INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
UNAUDITED
Dec 31, 2007 | Dec 31, 2006 | |||||
ASSETS | ||||||
Current Assets: | ||||||
Cash & cash equivalents | $ | 34,662 | $ | 28,652 | ||
Investments | 8,861 | 86 | ||||
Trade accounts receivable, less allowance for doubtful accounts of $ 2,264 and $2,523, respectively | 125,663 | 108,689 | ||||
Inventories | 171,661 | 150,160 | ||||
Prepaid expenses and other current assets | 3,990 | 2,926 | ||||
Insurance receivable | 6,885 | — | ||||
Deferred income taxes | 8,220 | 7,305 | ||||
Assets held for sale | 312 | 3,132 | ||||
Total Current Assets | 360,254 | 300,950 | ||||
Property, Plant and Equipment, net | 82,465 | 79,039 | ||||
Other Assets: | ||||||
Goodwill | 169,110 | 163,720 | ||||
Intangibles, net | 47,373 | 49,226 | ||||
Non current insurance receivable | 5,014 | — | ||||
Other assets | 12,253 | 12,740 | ||||
Total Assets | $ | 676,469 | $ | 605,675 | ||
LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||
Current Liabilities: | ||||||
Accounts payable | $ | 82,038 | $ | 71,788 | ||
Accrued expenses and other current liabilities | 72,481 | 53,333 | ||||
Accrued compensation and benefits | 21,498 | 15,325 | ||||
Asbestos liability | 9,697 | 1,026 | ||||
Income taxes payable | 7,900 | 6,027 | ||||
Notes payable and current portion of long-term debt | 201 | 415 | ||||
Total Current Liabilities | 193,815 | 147,914 | ||||
Long-Term Debt, net of current portion | 21,901 | 64,411 | ||||
Deferred Income Taxes | 19,106 | 21,674 | ||||
Long term asbestos liability | 7,062 | — | ||||
Other Non-Current Liabilities | 14,201 | 14,375 | ||||
Shareholders’ Equity: | ||||||
Preferred stock, $.01 par value; 1,000,000 shares authorized; no shares issued and outstanding | — | — | ||||
Common stock, $.01 par value; 29,000,000 shares authorized; and 16,650,407 and 16,181,070 issued and outstanding, respectively | 167 | 162 | ||||
Additional paid-in capital | 240,000 | 224,508 | ||||
Retained earnings | 144,644 | 109,251 | ||||
Accumulated other comprehensive income | 35,573 | 23,380 | ||||
Total Shareholders’ Equity | 420,384 | 357,301 | ||||
Total Liabilities and Shareholders’ Equity | $ | 676,469 | $ | 605,675 | ||
CIRCOR INTERNATIONAL, INC.
SUMMARY OF ORDERS AND BACKLOG
(in thousands)
UNAUDITED
Three Months Ended | Year Ended | |||||||||||||
Dec 31, 2007 | Dec 31, 2006 | Dec 31, 2007 | Dec 31, 2006 | |||||||||||
ORDERS | ||||||||||||||
Instrumentation & Thermal Fluid Controls | $ | 93,071 | $ | 74,111 | * | $ | 366,913 | $ | 323,214 | * | ||||
Energy Products | 77,348 | 95,368 | 404,752 | 381,762 | ||||||||||
Total orders | $ | 170,419 | $ | 169,479 | $ | 771,665 | $ | 704,976 | ||||||
Dec 31, 2007 | Dec 31, 2006 | |||||||||||||
BACKLOG | ||||||||||||||
Instrumentation & Thermal Fluid Controls | $ | 136,749 | $ | 113,434 | ||||||||||
Energy Products | 254,841 | 172,235 | ||||||||||||
Total backlog | $ | 391,590 | $ | 285,669 | ||||||||||
Note: Backlog includes all unshipped customer orders.
* | - Orders for the Instrumentation & Thermal Fluid Controls Products segment have been reduced by $1,851 and $8,281 for the three and twelve months ended December 31, 2006, respectively, for the sale in December 2006 of the small, French business, Societe Alsacienne Regulaves Thermiques von Rohr (“Sart”), |
CIRCOR INTERNATIONAL, INC.
SUMMARY REPORT BY SEGMENT
(in thousands, except earnings per share)
UNAUDITED
2006 | 2007 | |||||||||||||||||||||||||||||||||||||||
1ST QTR | 2ND QTR | 3RD QTR | 4TH QTR | Full Year | 1ST QTR | 2ND QTR | 3RD QTR | 4TH QTR | Full Year | |||||||||||||||||||||||||||||||
NET REVENUES | ||||||||||||||||||||||||||||||||||||||||
Instrumentation & Thermal Fluid Controls (TFC) | $ | 72,434 | $ | 79,470 | $ | 79,205 | $ | 81,591 | $ | 312,700 | $ | 81,296 | $ | 85,740 | $ | 85,094 | $ | 91,466 | $ | 343,596 | ||||||||||||||||||||
Energy Products | 54,861 | 64,919 | 71,207 | 88,024 | 279,011 | 79,967 | 80,197 | 78,923 | 83,057 | 322,144 | ||||||||||||||||||||||||||||||
Total | 127,295 | 144,389 | 150,412 | 169,615 | 591,711 | 161,263 | 165,937 | 164,017 | 174,523 | 665,740 | ||||||||||||||||||||||||||||||
OPERATING MARGIN | ||||||||||||||||||||||||||||||||||||||||
Instrumentation & TFC | 9.1 | % | 8.6 | % | 9.5 | % | 8.2 | % | 8.8 | % | 7.9 | % | 8.7 | % | 7.1 | % | 8.3 | % | 8.0 | % | ||||||||||||||||||||
Energy Products | 10.4 | % | 11.4 | % | 13.2 | % | 15.7 | % | 13.0 | % | 12.7 | % | 16.3 | % | 17.4 | % | 15.3 | % | 15.4 | % | ||||||||||||||||||||
Segment operating margin | 9.7 | % | 9.9 | % | 11.3 | % | 12.1 | % | 10.8 | % | 10.3 | % | 12.4 | % | 12.1 | % | 11.6 | % | 11.6 | % | ||||||||||||||||||||
Corporate expenses | -3.0 | % | -2.5 | % | -2.8 | % | -2.4 | % | -2.7 | % | -2.4 | % | -2.4 | % | -3.0 | % | -2.9 | % | -2.7 | % | ||||||||||||||||||||
Special charges | 0.0 | % | 0.0 | % | -0.3 | % | -0.1 | % | -0.1 | % | -0.4 | % | -0.4 | % | -1.3 | % | 0.5 | % | -0.4 | % | ||||||||||||||||||||
Total operating margin | 6.7 | % | 7.4 | % | 8.1 | % | 9.5 | % | 8.0 | % | 7.4 | % | 9.5 | % | 7.8 | % | 9.3 | % | 8.5 | % | ||||||||||||||||||||
OPERATING INCOME | ||||||||||||||||||||||||||||||||||||||||
Instrumentation & TFC (excl. special & unusual charges) | 6,595 | 6,861 | 7,522 | 6,680 | 27,658 | 6,433 | 7,438 | 6,076 | 7,589 | 27,536 | ||||||||||||||||||||||||||||||
Energy Products (excl. special & unusual charges) | 5,702 | 7,429 | 9,420 | 13,797 | 36,348 | 10,125 | 13,063 | 13,745 | 12,675 | 49,608 | ||||||||||||||||||||||||||||||
Segment operating income (excl. special & unusual charges) | 12,297 | 14,290 | 16,942 | 20,477 | 64,006 | 16,558 | 20,501 | 19,821 | 20,264 | 77,144 | ||||||||||||||||||||||||||||||
Corporate expenses (excl. special & unusual charges) | (3,809 | ) | (3,578 | ) | (4,284 | ) | (4,146 | ) | (15,817 | ) | (3,853 | ) | (4,056 | ) | (4,942 | ) | (5,012 | ) | (17,863 | ) | ||||||||||||||||||||
Special (charges) income, net | — | (479 | ) | (200 | ) | (679 | ) | (691 | ) | (615 | ) | (2,130 | ) | 922 | (2,514 | ) | ||||||||||||||||||||||||
Total operating income | 8,488 | 10,712 | 12,179 | 16,131 | 47,510 | 12,014 | 15,830 | 12,749 | 16,174 | 56,767 | ||||||||||||||||||||||||||||||
INTEREST EXPENSE, NET | (1,024 | ) | (1,464 | ) | (1,383 | ) | (1,246 | ) | (5,117 | ) | (1,218 | ) | (884 | ) | (744 | ) | (155 | ) | (3,001 | ) | ||||||||||||||||||||
OTHER (EXPENSE) INCOME, NET | 131 | 248 | (27 | ) | (486 | ) | (134 | ) | 97 | (215 | ) | 1,508 | (133 | ) | 1,257 | |||||||||||||||||||||||||
PRETAX INCOME | 7,595 | 9,496 | 10,769 | 14,399 | 42,259 | 10,893 | 14,731 | 13,513 | 15,886 | 55,023 | ||||||||||||||||||||||||||||||
PROVISION FOR INCOME TAXES | (2,431 | ) | (3,038 | ) | (3,446 | ) | (4,016 | ) | (12,931 | ) | (3,486 | ) | (4,713 | ) | (3,148 | ) | (5,765 | ) | (17,112 | ) | ||||||||||||||||||||
EFFECTIVE TAX RATE | 32.0 | % | 32.0 | % | 32.0 | % | 27.9 | % | 30.6 | % | 32.0 | % | 32.0 | % | 23.3 | % | 36.3 | % | 31.1 | % | ||||||||||||||||||||
NET INCOME | $ | 5,164 | $ | 6,458 | $ | 7,323 | $ | 10,383 | $ | 29,328 | $ | 7,407 | $ | 10,018 | $ | 10,365 | $ | 10,121 | $ | 37,911 | ||||||||||||||||||||
Weighted Average Common Shares Outstanding (Diluted) | 16,197 | 16,332 | 16,368 | 16,438 | 16,291 | 16,533 | 16,679 | 16,768 | 16,925 | 16,730 | ||||||||||||||||||||||||||||||
EARNINGS PER COMMON SHARE (Diluted) | $ | 0.32 | $ | 0.40 | $ | 0.45 | $ | 0.63 | $ | 1.80 | $ | 0.45 | $ | 0.60 | $ | 0.62 | $ | 0.60 | $ | 2.27 | ||||||||||||||||||||
EBIT | $ | 8,619 | $ | 10,960 | $ | 12,152 | $ | 15,645 | $ | 47,376 | $ | 12,111 | $ | 15,615 | $ | 14,257 | $ | 16,041 | $ | 58,024 | ||||||||||||||||||||
Depreciation | 2,619 | 3,169 | 2,901 | 2,517 | 11,206 | 2,808 | 2,812 | 2,662 | 2,588 | 10,870 | ||||||||||||||||||||||||||||||
Amortization of intangibles | 515 | 567 | 709 | 603 | 2,394 | 626 | 632 | 659 | 662 | 2,579 | ||||||||||||||||||||||||||||||
EBITDA | $ | 11,753 | $ | 14,696 | $ | 15,762 | $ | 18,765 | $ | 60,976 | $ | 15,545 | $ | 19,059 | $ | 17,578 | $ | 19,291 | $ | 71,473 | ||||||||||||||||||||
EBITDA AS A PERCENT OF SALES | 9.2 | % | 10.2 | % | 10.5 | % | 11.1 | % | 10.3 | % | 9.6 | % | 11.5 | % | 10.7 | % | 11.1 | % | 10.7 | % | ||||||||||||||||||||
CAPITAL EXPENDITURES | $ | 1,578 | $ | 1,742 | $ | 3,823 | $ | 2,790 | $ | 9,933 | $ | 1,776 | $ | 2,266 | $ | 2,844 | $ | 5,097 | $ | 11,983 | ||||||||||||||||||||
CIRCOR INTERNATIONAL, INC.
RECONCILIATION OF KEY PERFORMANCE MEASURES TO COMMONLY USED
GENERALLY ACCEPTED ACCOUNTING PRINCIPLE TERMS
(in thousands)
UNAUDITED
2006 | 2007 | |||||||||||||||||||||||||||||||||||||||||
1ST QTR | 2ND QTR | 3RD QTR | 4TH QTR | Full Year | 1ST QTR | 2ND QTR | 3RD QTR | 4TH QTR | Full Year | |||||||||||||||||||||||||||||||||
FREE CASH FLOW [NET CASH FLOW FROM OPERATING ACTIVITIES LESS CAPITAL EXPENDITURES LESS DIVIDENDS PAID] | $ | (5,213 | ) | $ | 402 | $ | 8,865 | $ | 13,476 | $ | 17,530 | $ | (5,429 | ) | $ | 5,439 | $ | 11,470 | $ | 30,989 | $ | 42,469 | ||||||||||||||||||||
ADD: | Capital expenditures | 1,578 | 1,742 | 3,823 | 2,790 | 9,933 | 1,776 | 2,266 | 2,844 | 5,097 | 11,983 | |||||||||||||||||||||||||||||||
Dividends paid | 595 | 600 | 600 | 600 | 2,395 | 609 | 614 | 617 | 624 | 2,464 | ||||||||||||||||||||||||||||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | $ | (3,040 | ) | $ | 2,744 | $ | 13,288 | $ | 16,866 | $ | 29,858 | $ | (3,044 | ) | $ | 8,319 | $ | 14,931 | $ | 36,710 | $ | 56,916 | ||||||||||||||||||||
NET (CASH) DEBT [TOTAL DEBT LESS CASH & CASH EQUIVALENTS LESS INVESTMENTS] | $ | 68,271 | $ | 64,336 | $ | 55,157 | $ | 36,088 | $ | 36,088 | $ | 39,366 | $ | 29,848 | $ | 11,815 | $ | (21,421 | ) | $ | (21,421 | ) | ||||||||||||||||||||
ADD: | Cash & cash equivalents | 27,069 | 25,966 | 33,265 | 28,652 | 28,652 | 27,050 | 25,281 | 30,174 | 34,662 | 34,662 | |||||||||||||||||||||||||||||||
Investments | — | 2,639 | 90 | 86 | 86 | 87 | 94 | 100 | 8,861 | 8,861 | ||||||||||||||||||||||||||||||||
TOTAL DEBT | $ | 95,340 | $ | 92,941 | $ | 88,512 | $ | 64,826 | $ | 64,826 | $ | 66,503 | $ | 55,223 | $ | 42,089 | $ | 22,102 | $ | 22,102 | ||||||||||||||||||||||
NET DEBT AS % OF NET CAPITALIZATION | 18 | % | 16 | % | 14 | % | 9 | % | 9 | % | 10 | % | 7 | % | 3 | % | -5 | % | -5 | % | ||||||||||||||||||||||
NET CAPITALIZATION [TOTAL DEBT PLUS SHAREHOLDERS’ EQUITY LESS CASH & CASH EQUIVALENTS, LESS INVESTMENTS] | $ | 385,659 | $ | 397,814 | $ | 397,012 | $ | 393,389 | $ | 393,389 | $ | 408,944 | $ | 415,386 | $ | 420,951 | $ | 398,963 | $ | 398,963 | ||||||||||||||||||||||
LESS: | Total debt | (95,340 | ) | (92,941 | ) | (88,512 | ) | (64,826 | ) | (64,826 | ) | (66,503 | ) | (55,223 | ) | (42,089 | ) | (22,102 | ) | (22,102 | ) | |||||||||||||||||||||
ADD: | Cash & cash equivalents | 27,069 | 25,966 | 33,265 | 28,652 | 28,652 | 27,050 | 25,281 | 30,174 | 34,662 | 34,662 | |||||||||||||||||||||||||||||||
Investments | — | 2,639 | 90 | 86 | 86 | 87 | 94 | 100 | 8,861 | 8,861 | ||||||||||||||||||||||||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 317,388 | 333,478 | 341,855 | 357,301 | 357,301 | 369,578 | 385,538 | 409,136 | 420,384 | 420,384 | ||||||||||||||||||||||||||||||||
ADD: | Total debt | 95,340 | 92,941 | 88,512 | 64,826 | 64,826 | 66,503 | 55,223 | 42,089 | 22,102 | 22,102 | |||||||||||||||||||||||||||||||
TOTAL CAPITAL | $ | 412,728 | $ | 426,419 | $ | 430,367 | $ | 422,127 | $ | 422,127 | $ | 436,081 | $ | 440,761 | $ | 451,225 | $ | 442,486 | $ | 442,486 | ||||||||||||||||||||||
TOTAL DEBT / TOTAL CAPITAL | 23 | % | 22 | % | 21 | % | 15 | % | 15 | % | 15 | % | 13 | % | 9 | % | 5 | % | 5 | % | ||||||||||||||||||||||
EBIT [NET INCOME LESS INTEREST EXPENSE, NET LESS TAXES] | $ | 8,619 | $ | 10,960 | $ | 12,152 | $ | 15,645 | $ | 47,376 | $ | 12,111 | $ | 15,615 | $ | 14,257 | $ | 16,041 | $ | 58,024 | ||||||||||||||||||||||
LESS: | Interest expense, net | (1,024 | ) | (1,464 | ) | (1,383 | ) | (1,246 | ) | (5,117 | ) | (1,218 | ) | (884 | ) | (744 | ) | (155 | ) | (3,001 | ) | |||||||||||||||||||||
Provision for income taxes | (2,431 | ) | (3,038 | ) | (3,446 | ) | (4,016 | ) | (12,931 | ) | (3,486 | ) | (4,713 | ) | (3,148 | ) | (5,765 | ) | (17,112 | ) | ||||||||||||||||||||||
NET INCOME | $ | 5,164 | $ | 6,458 | $ | 7,323 | $ | 10,383 | $ | 29,328 | $ | 7,407 | $ | 10,018 | $ | 10,365 | $ | 10,121 | $ | 37,911 | ||||||||||||||||||||||
EBITDA [NET INCOME LESS INTEREST EXPENSE, NET LESS DEPRECIATION LESS AMORTIZATION LESS TAXES] | $ | 11,753 | $ | 14,696 | $ | 15,762 | $ | 18,765 | $ | 60,976 | $ | 15,545 | $ | 19,059 | $ | 17,578 | $ | 19,291 | $ | 71,473 | ||||||||||||||||||||||
LESS: | ||||||||||||||||||||||||||||||||||||||||||
Interest expense, net | (1,024 | ) | (1,464 | ) | (1,383 | ) | (1,246 | ) | (5,117 | ) | (1,218 | ) | (884 | ) | (744 | ) | (155 | ) | (3,001 | ) | ||||||||||||||||||||||
Depreciation | (2,619 | ) | (3,169 | ) | (2,901 | ) | (2,517 | ) | (11,206 | ) | (2,808 | ) | (2,812 | ) | (2,662 | ) | (2,588 | ) | (10,870 | ) | ||||||||||||||||||||||
Amortization of intangibles | (515 | ) | (567 | ) | (709 | ) | (603 | ) | (2,394 | ) | (626 | ) | (632 | ) | (659 | ) | (662 | ) | (2,579 | ) | ||||||||||||||||||||||
Provision for income taxes | (2,431 | ) | (3,038 | ) | (3,446 | ) | (4,016 | ) | (12,931 | ) | (3,486 | ) | (4,713 | ) | (3,148 | ) | (5,765 | ) | (17,112 | ) | ||||||||||||||||||||||
NET INCOME | $ | 5,164 | $ | 6,458 | $ | 7,323 | $ | 10,383 | $ | 29,328 | $ | 7,407 | $ | 10,018 | $ | 10,365 | $ | 10,121 | $ | 37,911 | ||||||||||||||||||||||