MILWAUKEE--(BUSINESS WIRE)--September 26, 2019--Enerpac Tool Group, which is the doing business name of Actuant Corporation, (NYSE: ATU) (the “Company”) today announced results for its fiscal 2019 fourth quarter ended August 31, 2019.
“Fiscal 2019 has been a year of transformation for our organization with the announcement of the EC&S divestiture, which is instrumental in advancing our strategy as a pure play industrial tools and services company, and the recent launch of our new business name, Enerpac Tool Group. As planned, our portfolio optimization continued as we exited certain unprofitable parts of the service business in the quarter, which we expect will result in incremental profitability. We also continued to execute on our capital allocation strategy in the quarter, as demonstrated by our share repurchases and additional debt reduction, while ensuring we retain the balance sheet flexibility to support organic growth and acquisition opportunities,” commented Randy Baker, Enerpac Tool Group’s President and CEO.
Mr. Baker continued, “Consistent with most global industrial economic indicators, we saw a softening top line in the fourth quarter which caused our results to be below expectations. We believe the strategic growth and cost actions we are taking position us well for the future despite moderating market conditions.”
Consolidated Results from Continuing Operations |
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(US$ in millions) |
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| Three Months Ended August 31 |
| Twelve Months Ended August 31 |
| 2019 |
| 2018 |
| 2019 |
| 2018 |
Net Sales | $158.3 |
| $166.5 |
| $654.8 |
| $641.3 |
Net (Loss) Income | ($0.6) | | $11.3 | | $8.1 | | $4.7 |
(Loss) Earnings Per Share | ($0.01) |
| $0.18 |
| $0.13 |
| $0.08 |
Adjusted Earnings Per Share | $0.21 |
| $0.21 |
| $0.73 |
| $0.49 |
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- Consolidated net sales from continuing operations for the fourth quarter were $158.3 million, compared to $166.5 million in the prior year fourth quarter. Core sales declined 3% year-over-year, while foreign currency rate changes decreased net sales by 2%.
- Consolidated net sales from continuing operations for the twelve months ended August 31, 2019 were $654.8 million, compared to $641.3 million in the prior year period. Core sales improved 4% year-over-year while foreign currency rates decreased net sales by 2%.
- Fiscal 2019 fourth quarter net loss and EPS from continuing operations were ($0.6) million and a loss of ($0.01), respectively, compared to net income and EPS from continuing operations of $11.3 million and $0.18, respectively, in the fourth quarter of fiscal 2018. Fiscal 2019 fourth quarter earnings from continuing operations included:
- Impairment and other divestiture charges of $6.2 million ($4.3 million, or $0.07 per share after tax);
- Restructuring and other exit charges of $4.8 million ($6.3 million, or $0.10 per share after tax), related to the planned exits of certain unprofitable service offerings; and
- $2.7 million ($0.05 per share) of charges primarily related to an adjustment to the original provision for U.S. tax reform.
- Fiscal 2018 fourth quarter earnings from continuing operations included restructuring charges of $0.7 million ($0.2 million or $0.01 per share, after tax), a $0.6 million or $0.01 per share benefit related to the impact of the U.S. tax reform and a $0.8 million charge ($0.6 million or $0.01 per share, after tax) associated with the acceleration of debt issuance costs resulting from the intentional reduction in the borrowing capacity under our credit facility.
- Net income from continuing operations and EPS from continuing operations for the twelve month period ended August 31, 2019 were $8.1 million and $0.13, respectively, compared to a net income from continuing operations and EPS from continuing operations of $4.7 million and $0.08, respectively, in the comparable prior year period.
- Excluding impairment, other divestiture, restructuring and other exit charges, adjusted EPS from continuing operations was $0.21 for the fourth quarter of both fiscal 2019 and 2018 and $0.73 and $0.49 for the twelve months ended August 31, 2019 and 2018, respectively.
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Industrial Tools & Services (“IT&S”) | |
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(US$ in millions) | |
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| Three Months Ended August 31 |
| Twelve Months Ended August 31 |
| 2019 |
| 2018 |
| 2019 |
| 2018 |
Sales | $144.6 |
| $153.4 |
| $609.5 |
| $591.1 |
Operating Profit | $13.6 |
| $28.0 |
| $101.4 |
| $99.4 |
Adjusted Op Profit (1) | $27.3 |
| $28.8 |
| $116.2 |
| $103.7 |
Adjusted Op Profit % (1) | 18.8% |
| 18.8% |
| 19.1% |
| 17.5% |
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(1) Excludes $4.8 million and $6.0 million of restructuring and other exit charges in the three and
twelve months ended August 31, 2019, respectively, along with $8.8 million of impairment charges
in the fourth quarter and twelve months ended August 31, 2019. Excludes $0.8 million and $4.3 million
of restructuring charges in the three and twelve months ended August 31, 2018, respectively. |
- Fourth quarter fiscal 2019 net sales were $144.6 million, 6% lower than the prior year’s fiscal fourth quarter. Core sales decreased 4% and the impact of foreign currency exchange rates decreased net sales by 2% year-over-year.
- The decrease in revenue is attributable to the intentional exit of certain unprofitable portions of the business along with global economic uncertainty that created additional headwinds, which were most pronounced in Europe.
- Adjusted operating profit margin of 18.8% in the quarter was flat year-over-year due to decreased sales volume offset by continued product margin expansion and lower incentive compensation expense.
Corporate Expenses and Income Taxes (excluding one-time tax items)
- Corporate expenses from continuing operations for the fourth quarter of fiscal 2019 were $9.7 million, $0.6 million higher than the comparable prior year period, primarily resulting from higher insurance costs. Corporate costs included $3.3 million and $3.8 million of costs previously allocated to the EC&S segment in the fourth quarters of fiscal 2019 and 2018, respectively.
- The fourth quarter effective income tax rate from continuing operations of approximately (5%) was lower than the prior year rate of 0.5%.
Discontinued Operations
Discontinued operations represent the operating results for the EC&S segment, excluding Cortland U.S. and the previously divested Viking business, for all periods presented. The fourth quarter of fiscal 2019 includes a $265 million non-cash, after-tax impairment charge reflecting both the write-down of the net assets held for sale to their net realizable value and the reserve of the accumulation of currency translation losses associated with the EC&S businesses being divested.
Balance Sheet and Leverage | |
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(US$ in millions) | |
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| Period Ended |
| August 31, 2019 |
| May 31, 2019 |
| August 31, 2018 |
Cash Balance | $211.2 |
| $201.3 |
| $250.5 |
Debt Balance | $460.4 |
| $475.2 |
| $532.7 |
Net Debt to Adjusted EBITDA** | 1.7 |
| 1.8 |
| 1.9 |
Net debt at August 31, 2019 was approximately $249 million (total debt of $460 million less $211 million of cash), which decreased approximately $33 million from the end of fiscal 2018. Net Debt to Adjusted EBITDA was 1.7x at August 31, 2019.
**Adjusted EBITDA is calculated for the twelve months then ended.
Outlook
Mr. Baker said, “With our transformation to Enerpac Tool Group we are creating a very high quality company with market leading products, top tier margins and a commitment to growth. In fiscal 2020, we will continue to focus on our growth initiatives, building on our premier Enerpac brand. We will also continue taking strategic actions to exit low margin product lines, and have already completed one small product line divestiture in fiscal 2020 and expect to complete another by the end of the first quarter. We expect these actions will provide significant improvement to our bottom line. While our fiscal 2020 outlook reflects our cautious view of the year given current economic uncertainty in our end-markets, we are confident in the decisive actions we are taking and our ability to execute on our strategy to create shareholder value.”
The company provides the following outlook for continuing operations for fiscal 2020***:
Sales range of $575 to $600 million which assumes:
- Strategic exits (including product line divestitures and service restructuring) of approximately $55 million;
- Foreign currency impact from stronger dollar of approximately $7 million; and
- New product development and other commercial actions partially offset by a tepid market environment.
EBITDA range of $94 to $104 million, which is an approximate 17% EBITDA margin and greater than a 200bp improvement from fiscal year 2019, which assumes:
- Benefit from strategic exits and approximately $9 million reduction of corporate overhead costs previously allocated to the EC&S segment
- Partially offset by certain expenses to be incurred in the year as well as the impact of the stronger dollar
EPS range of $0.68 to $0.81/share
Full year free cash flow of $50 to $75 million
For the first quarter 2020, we expect:
- Net sales: $135 to $144 million;
- Adjusted EBITDA: $17.5 to $20.5 million; and
- Adjusted EPS: $0.08 to $0.12.
All guidance excludes restructuring, impairment and divestiture charges, one-time tax adjustments and the impact of potential future acquisitions, dispositions, share repurchases and tariffs.
***See the Fourth Quarter Earnings presentation included on the Company’s website for further details on fiscal 2020 guidance
EC&S Divestiture Process
As previously announced, the Company signed a definitive agreement with One Rock Capital Partners in July 2019 to sell the EC&S segment and continues to expect to close the transaction in the fourth quarter of calendar 2019.
Conference Call Information
An investor conference call is scheduled for 10am CT today, September 26, 2019. Webcast information and conference call materials are available on the Enerpac Tool Group company website (www.enerpactoolgroup.com).
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. Among other risks and factors, Enerpac Tool Group’s results are 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, tax reform, foreign currency fluctuations and interest rate risk. See Actuant Corporation’s Form 10-K for the fiscal year ended August 31, 2018 filed with the Securities and Exchange Commission for further information regarding risk factors. Enerpac Tool Group disclaims any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or any other reason.
Non-GAAP Financial Information
This press release contains financial measures that are not measures presented in conformity with GAAP. They include EBITDA from continuing operations, adjusted EBITDA from continuing operations, adjusted EPS from continuing operations, adjusted operating profit from continuing operations, free cash flow and net debt. This press release includes reconciliations of these non-GAAP measures to the most comparable GAAP measure, including in the tables attached to this press release. Management believes these non-GAAP measures are commonly used financial measures for investors to evaluate Enerpac Tool Group’s operating performance and financial position with respect to the periods presented and, when read in conjunction with the condensed consolidated financial statements, present a useful tool to evaluate ongoing operations and provide investors with metrics they can use to evaluate aspects of the Company’s performance from period to period. In addition, these are some of the factors management uses in internal evaluations of the overall performance of the Company’s business. Management acknowledges that there are many items that impact a company’s reported results and the adjustments reflected in these non-GAAP measures are not intended to present all items that may have impacted these results. In addition, these non-GAAP measures are not necessarily comparable to similarly-titled measures used by other companies.
About Enerpac Tool Group
Enerpac Tool Group is a premier industrial tools and services company serving a broad and diverse set of customers in more than 90 countries. The Company’s businesses are global leaders in high pressure hydraulic tools, controlled force products and solutions for precise positioning of heavy loads that help customers safely and reliably tackle some of the most challenging jobs around the world. The Company was founded in 1910 and is headquartered in Menomonee Falls, Wisconsin. Enerpac Tool Group will trade on the NYSE under the symbol EPAC beginning on October 7, 2019. Until then, our NYSE symbol is ATU. Although the Company has adopted the business name “Enerpac Tool Group” its legal corporate name continues to be Actuant Corporation pending amendment to its corporate organizational documents, which is subject to shareholder approval. For further information on Enerpac Tool Group and its businesses, visit the Company's website at www.enerpactoolgroup.com.
(tables follow)
| Actuant Corporation |
| Condensed Consolidated Balance Sheets |
| (Dollars in thousands) |
| (Unaudited) |
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| August 31, | | August 31, |
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| | 2019 | | | | 2018 | |
| ASSETS |
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| Current assets |
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| Cash and cash equivalents |
| $ | 211,151 | |
| $ | 250,490 | |
| Accounts receivable, net |
| | 125,883 | |
| | 123,261 | |
| Inventories, net |
| | 77,187 | |
| | 72,020 | |
| Assets from discontinued operations |
| | 285,578 | |
| | 571,157 | |
| Other current assets |
| | 30,526 | |
| | 32,530 | |
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| Total current assets |
| | 730,325 | |
| | 1,049,458 | |
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| Property, plant and equipment, net |
| | 56,729 | |
| | 54,974 | |
| Goodwill |
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| | 260,415 | |
| | 280,132 | |
| Other intangible assets, net |
| | 52,375 | |
| | 71,657 | |
| Other long-term assets |
| | 24,430 | |
| | 25,115 | |
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| Total assets |
| $ | 1,124,274 | |
| $ | 1,481,336 | |
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| LIABILITIES AND SHAREHOLDERS' EQUITY |
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| Current liabilities |
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| Trade accounts payable |
| $ | 76,914 | |
| $ | 69,584 | |
| Accrued compensation and benefits |
| | 26,421 | |
| | 35,992 | |
| Current maturities of debt |
| | 7,500 | |
| | 30,000 | |
| Income taxes payable |
| | 4,838 | |
| | 4,091 | |
| Liabilities from discontinued operations |
| | 143,763 | |
| | 160,573 | |
| Other current liabilities |
| | 40,965 | |
| | 53,768 | |
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| Total current liabilities |
| | 300,401 | |
| | 354,008 | |
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| Long-term debt, net |
| | 452,945 | |
| | 502,695 | |
| Deferred income taxes |
| | 1,564 | |
| | 68 | |
| Pension and postretirement benefit liabilities |
| | 20,213 | |
| | 13,957 | |
| Other long-term liabilities |
| | 47,972 | |
| | 51,896 | |
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| Total liabilities |
| | 823,095 | |
| | 922,624 | |
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| Shareholders' equity |
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| Capital stock |
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| | 16,384 | |
| | 16,285 | |
| Additional paid-in capital |
| | 181,213 | |
| | 167,448 | |
| Treasury stock |
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| | (640,212 | ) |
| | (617,731 | ) |
| Retained earnings |
| | 915,466 | |
| | 1,166,955 | |
| Accumulated other comprehensive loss |
| | (171,672 | ) |
| | (174,245 | ) |
| Stock held in trust |
| | (3,070 | ) |
| | (2,450 | ) |
| Deferred compensation liability |
| | 3,070 | |
| | 2,450 | |
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| Total shareholders' equity |
| | 301,179 | |
| | 558,712 | |
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| Total liabilities and shareholders' equity |
| $ | 1,124,274 | |
| $ | 1,481,336 | |
| Actuant Corporation |
| Condensed Consolidated Statements of Operations |
| (Dollars in thousands, except per share amounts) |
| (Unaudited) |
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| Three Months Ended | | Twelve Months Ended |
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| August 31, | August 31, | | August 31, | August 31, |
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| 2019 | 2018 | | 2019 | 2018 |
| Net sales |
| $ | 158,324 | | $ | 166,468 | |
| $ | 654,758 | | $ | 641,303 | |
| Cost of products sold |
| | 89,254 | | | 93,108 | |
| | 362,106 | | | 358,019 | |
| Gross profit |
| | 69,070 | | | 73,360 | |
| | 292,652 | | | 283,284 | |
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| Selling, administrative and engineering expenses |
| | 49,866 | | | 50,881 | |
| | 209,231 | | | 210,256 | |
| Amortization of intangible assets |
| | 1,933 | | | 2,343 | |
| | 8,922 | | | 9,280 | |
| Restructuring charges |
| | 3,025 | | | 742 | |
| | 4,156 | | | 10,555 | |
| Impairment & divestiture charges |
| | 6,227 | | | - | |
| | 22,827 | | | 2,987 | |
| Operating profit |
| | 8,019 | | | 19,394 | |
| | 47,516 | | | 50,206 | |
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| Financing costs, net |
| | 6,563 | | | 8,417 | |
| | 28,163 | | | 30,872 | |
| Other expense (income), net |
| | 394 | | | (252 | ) |
| | 629 | | | 138 | |
| Income before income tax expense (benefit) |
| | 1,062 | | | 11,229 | |
| | 18,724 | | | 19,196 | |
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| Income tax expense (benefit) |
| | 1,626 | | | (99 | ) |
| | 10,657 | | | 14,450 | |
| (Loss) earnings from continuing operations |
| | (564 | ) | | 11,328 | |
| | 8,067 | | | 4,746 | |
| Loss from discontinued operations, net of income taxes |
| | (266,300 | ) | | (48,992 | ) |
| | (257,212 | ) | | (26,394 | ) |
| Net loss |
| $ | (266,864 | ) | $ | (37,664 | ) |
| $ | (249,145 | ) | $ | (21,648 | ) |
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| (Loss) earnings from continuing operations per share |
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| Basic |
| $ | (0.01 | ) | $ | 0.19 | |
| $ | 0.13 | | $ | 0.08 | |
| Diluted |
| | (0.01 | ) | | 0.18 | |
| | 0.13 | | | 0.08 | |
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| Loss from discontinued operations |
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| Basic |
| $ | (4.37 | ) | $ | (0.80 | ) |
| $ | (4.21 | ) | $ | (0.44 | ) |
| Diluted |
| | (4.37 | ) | | (0.80 | ) |
| | (4.18 | ) | | (0.43 | ) |
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| Loss per share |
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| Basic |
| $ | (4.38 | ) | $ | (0.62 | ) |
| $ | (4.07 | ) | $ | (0.36 | ) |
| Diluted |
| | (4.38 | ) | | (0.61 | ) |
| | (4.04 | ) | | (0.35 | ) |
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| Weighted average common shares outstanding |
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| Basic |
| | 60,907 | | | 60,893 | |
| | 61,151 | | | 60,441 | |
| Diluted |
| | 60,907 | | | 61,561 | |
| | 61,607 | | | 61,028 | |
| Actuant Corporation |
| Condensed Consolidated Statements of Cash Flows |
| (In thousands) |
| (Unaudited) |
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| Twelve Months Ended |
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| August 31, | | August 31, |
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| 2019 | | 2018 |
| Operating Activities |
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| Cash provided by operating activities |
| $ | 53,845 | |
| $ | 106,093 | |
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| Investing Activities |
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| Capital expenditures |
| | (26,755 | ) |
| | (20,870 | ) |
| Proceeds from sale of property, plant and equipment |
| | 1,642 | |
| | 153 | |
| Rental asset buyout for Viking divestiture |
| | - | |
| | (27,718 | ) |
| Proceeds from sale of business, net of transaction costs |
| | 36,159 | |
| | 8,902 | |
| Cash paid for business acquisitions, net of cash acquired |
| | - | |
| | (23,218 | ) |
| Cash provided by (used in) investing activities |
| | 11,046 | |
| | (62,751 | ) |
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| Financing Activities |
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| Payment for redemption of term loan |
| | (200,000 | ) |
| | - | |
| Proceeds from issuance of term loan |
| | 200,000 | |
| | - | |
| Principal repayments on term loan |
| | (72,500 | ) |
| | (30,000 | ) |
| Purchase of treasury shares |
| | (22,481 | ) |
| | - | |
| Taxes paid related to the net share settlement of equity awards |
| | (1,872 | ) |
| | (1,284 | ) |
| Stock option exercises & other |
| | 1,900 | |
| | 15,681 | |
| Payment of cash dividend |
| | (2,439 | ) |
| | (2,390 | ) |
| Payment of debt issuance costs |
| | (2,125 | ) |
| | - | |
| Cash used in financing activities |
| | (99,517 | ) |
| | (17,993 | ) |
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| Effect of exchange rate changes on cash |
| | (4,713 | ) |
| | (4,430 | ) |
| Net (decrease) increase in cash and cash equivalents |
| | (39,339 | ) |
| | 20,919 | |
| Cash and cash equivalents - beginning of period |
| | 250,490 | |
| | 229,571 | |
| Cash and cash equivalents - end of period |
| $ | 211,151 | |
| $ | 250,490 | |
| ACTUANT CORPORATION |
| SUPPLEMENTAL UNAUDITED DATA |
| (Dollars in thousands) |
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| FISCAL 2018 | | FISCAL 2019 |
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| Q1 | Q2 | Q3 | Q4 | TOTAL | | Q1 | Q2 | Q3 | Q4 | TOTAL |
| SALES |
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| INDUSTRIAL TOOLS & SERVICES SEGMENT | $ | 141,991 | | $ | 136,986 | | $ | 158,735 | | $ | 153,373 | | $ | 591,085 | |
| $ | 148,655 | | $ | 149,521 | | $ | 166,732 | | $ | 144,607 | | $ | 609,515 | |
| OTHER | | 13,776 | | | 11,615 | | | 11,731 | | | 13,095 | | | 50,218 | |
| | 9,896 | | | 10,267 | | | 11,363 | | | 13,717 | | | 45,243 | |
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| TOTAL | $ | 155,767 | | $ | 148,601 | | $ | 170,466 | | $ | 166,468 | | $ | 641,303 | |
| $ | 158,551 | | $ | 159,788 | | $ | 178,095 | | $ | 158,324 | | $ | 654,758 | |
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| % SALES GROWTH |
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| INDUSTRIAL TOOLS & SERVICES SEGMENT | | 2 | % | | 5 | % | | 8 | % | | 12 | % | | 7 | % |
| | 5 | % | | 9 | % | | 5 | % | | -6 | % | | 3 | % |
| OTHER | | -12 | % | | -30 | % | | -27 | % | | -17 | % | | -22 | % |
| | -28 | % | | -12 | % | | -3 | % | | 5 | % | | -10 | % |
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| TOTAL | | 1 | % | | 1 | % | | 4 | % | | 9 | % | | 4 | % |
| | 2 | % | | 8 | % | | 4 | % | | -5 | % | | 2 | % |
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| OPERATING PROFIT (LOSS) |
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| INDUSTRIAL TOOLS & SERVICES SEGMENT | $ | 22,218 | | $ | 20,510 | | $ | 32,206 | | $ | 28,783 | | $ | 103,718 | |
| $ | 26,345 | | $ | 26,596 | | $ | 35,992 | | $ | 27,252 | | $ | 116,185 | |
| OTHER | | (864 | ) | | 123 | | | 189 | | | 443 | | | (109 | ) |
| | (484 | ) | | 1,091 | | | 1,787 | | | 1,515 | | | 3,910 | |
| CORPORATE / GENERAL | | (9,421 | ) | | (8,503 | ) | | (11,995 | ) | | (9,090 | ) | | (39,012 | ) |
| | (10,967 | ) | | (11,659 | ) | | (9,481 | ) | | (9,679 | ) | | (41,787 | ) |
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| ADJUSTED OPERATING PROFIT | $ | 11,933 | | $ | 12,130 | | $ | 20,400 | | $ | 20,136 | | $ | 64,597 | |
| $ | 14,894 | | $ | 16,028 | | $ | 28,298 | | $ | 19,088 | | $ | 78,308 | |
| IMPAIRMENT & DIVESTITURE CHARGES | | - | | | (2,987 | ) | | - | | | - | | | (2,987 | ) |
| | (23,477 | ) | | (6,112 | ) | | 12,988 | | | (6,227 | ) | | (22,827 | ) |
| RESTRUCTURING & OTHER EXIT CHARGES (1) | | (6,331 | ) | | (3,527 | ) | | (805 | ) | | (742 | ) | | (11,404 | ) |
| | 29 | | | (46 | ) | | (1,115 | ) | | (4,842 | ) | | (5,973 | ) |
| DEBT MODIFICATION COSTS | | - | | | - | | | - | | | - | | | - | |
| | - | | | - | | | (288 | ) | | - | | | (288 | ) |
| DEPRECIATION & AMORTIZATION TRUE UP (2) | | - | | | - | | | - | | | - | | | - | |
| | - | | | - | | | (1,704 | ) | | - | | | (1,704 | ) |
|
| OPERATING PROFIT (LOSS) | $ | 5,602 | | $ | 5,616 | | $ | 19,595 | | $ | 19,394 | | $ | 50,206 | |
| $ | (8,554 | ) | $ | 9,870 | | $ | 38,179 | | $ | 8,019 | | $ | 47,516 | |
|
|
|
|
|
|
|
|
|
|
|
|
| |
| ADJUSTED OPERATING PROFIT % |
|
|
|
|
|
|
|
|
|
|
|
| INDUSTRIAL TOOLS & SERVICES SEGMENT | | 15.6 | % | | 15.0 | % | | 20.3 | % | | 18.8 | % | | 17.5 | % |
| | 17.7 | % | | 17.8 | % | | 21.6 | % | | 18.8 | % | | 19.1 | % |
| OTHER | | -6.3 | % | | 1.1 | % | | 1.6 | % | | 3.4 | % | | -0.2 | % |
| | -4.9 | % | | 10.6 | % | | 15.7 | % | | 11.0 | % | | 8.6 | % |
|
| ADJUSTED OPERATING PROFIT % | | 7.7 | % | | 8.2 | % | | 12.0 | % | | 12.1 | % | | 10.1 | % |
| | 9.4 | % | | 10.0 | % | | 15.9 | % | | 12.1 | % | | 12.0 | % |
|
|
|
|
|
|
|
|
|
|
|
|
| |
| EBITDA |
|
|
|
|
|
|
|
|
|
|
|
| INDUSTRIAL TOOLS & SERVICES SEGMENT | $ | 25,567 | | $ | 24,594 | | $ | 36,394 | | $ | 32,763 | | $ | 119,318 | |
| $ | 30,038 | | $ | 30,153 | | $ | 40,015 | | $ | 29,964 | | $ | 130,171 | |
| OTHER | | (111 | ) | | 826 | | | 985 | | | 1,250 | | | 2,951 | |
| | 337 | | | 1,087 | | | 1,786 | | | 2,395 | | | 5,605 | |
| CORPORATE / GENERAL | | (8,906 | ) | | (8,964 | ) | | (11,067 | ) | | (8,466 | ) | | (37,405 | ) |
| | (10,930 | ) | | (11,422 | ) | | (8,311 | ) | | (8,919 | ) | | (39,584 | ) |
|
| ADJUSTED EBITDA | $ | 16,550 | | $ | 16,456 | | $ | 26,312 | | $ | 25,547 | | $ | 84,864 | |
| $ | 19,445 | | $ | 19,818 | | $ | 33,490 | | $ | 23,440 | | $ | 96,192 | |
| IMPAIRMENT & DIVESTITURE CHARGES | | - | | | (2,987 | ) | | - | | | - | | | (2,987 | ) |
| | (23,477 | ) | | (6,112 | ) | | 12,988 | | | (6,227 | ) | | (22,827 | ) |
| RESTRUCTURING & OTHER EXIT CHARGES (1) | | (6,331 | ) | | (3,527 | ) | | (805 | ) | | (742 | ) | | (11,404 | ) |
| | 29 | | | (46 | ) | | (1,115 | ) | | (4,842 | ) | | (5,973 | ) |
| DEBT MODIFICATION COSTS | | - | | | - | | | - | | | - | | | - | |
| | - | | | - | | | (288 | ) | | - | | | (288 | ) |
|
| EBITDA | $ | 10,219 | | $ | 9,942 | | $ | 25,507 | | $ | 24,805 | | $ | 70,473 | |
| $ | (4,003 | ) | $ | 13,660 | | $ | 45,075 | | $ | 12,371 | | $ | 67,104 | |
|
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| |
| ADJUSTED EBITDA % |
|
|
|
|
|
|
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|
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|
| INDUSTRIAL TOOLS & SERVICES SEGMENT | | 18.0 | % | | 18.0 | % | | 22.9 | % | | 21.4 | % | | 20.2 | % |
| | 20.2 | % | | 20.2 | % | | 24.0 | % | | 20.7 | % | | 21.4 | % |
| OTHER | | -0.8 | % | | 7.1 | % | | 8.4 | % | | 9.5 | % | | 5.9 | % |
| | 3.4 | % | | 10.6 | % | | 15.7 | % | | 17.5 | % | | 12.4 | % |
|
| ADJUSTED EBITDA % | | 10.6 | % | | 11.1 | % | | 15.4 | % | | 15.3 | % | | 13.2 | % |
| | 12.3 | % | | 12.4 | % | | 18.8 | % | | 14.8 | % | | 14.7 | % |
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| |
| Notes: (1) Approximately $1.8 million of the Q4 fiscal 2019 and $0.8 million of the Q2 fiscal 2018 restructuring & exit charges were recorded in cost of products sold. De minimis restructuring charges were also recorded in cost of products sold in Q3 fiscal 2018. (2) Represents the depreciation and amortization expense true up for the Cortland business assets that were reclassified out of held for sale in Q3 fiscal 2019, as though the assets had never been classified as held for sale. |
| ACTUANT CORPORATION |
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|
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| SUPPLEMENTAL UNAUDITED DATA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| RECONCILIATION OF GAAP MEASURES TO NON-GAAP MEASURES |
|
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| (Dollars in thousands, except for per share amounts) |
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| |
|
|
|
|
| FISCAL 2018 |
| FISCAL 2019 |
|
|
|
|
| Q1 |
| Q2 |
| Q3 |
| Q4 |
| TOTAL |
| Q1 |
| Q2 |
| Q3 |
| Q4 |
| TOTAL |
| ADJUSTED EARNINGS (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NET EARNINGS (LOSS) (GAAP MEASURE) |
| $ | 5,226 | |
| $ | (18,221 | ) |
| $ | 29,012 | |
| $ | (37,664 | ) |
| $ | (21,648 | ) |
| $ | (17,452 | ) |
| $ | 2,753 | |
| $ | 32,418 | |
| $ | (266,864 | ) |
| $ | (249,145 | ) |
| DISCONTINUED OPERATIONS, NET OF INCOME TAX |
| | 8,066 | |
| | 3,347 | |
| | 11,185 | |
| | (48,992 | ) |
| | (26,394 | ) |
| | (1,029 | ) |
| | 4,557 | |
| | 5,560 | |
| | (266,300 | ) |
| | (257,212 | ) |
|
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS |
| $ | (2,840 | ) |
| $ | (21,568 | ) |
| $ | 17,827 | |
| $ | 11,328 | |
| $ | 4,746 | |
| $ | (16,423 | ) |
| $ | (1,804 | ) |
| $ | 26,858 | |
| $ | (564 | ) |
| $ | 8,067 | |
| IMPAIRMENT & DIVESTITURE CHARGES, NET OF TAX EFFECT |
| | - | |
| | 12,385 | |
| | - | |
| | - | |
| | 12,385 | |
| | 23,477 | |
| | 6,112 | |
| | (13,001 | ) |
| | 4,343 | |
| | 20,930 | |
| RESTRUCTURING & OTHER EXIT CHARGES, NET OF TAX EFFECT |
| | 6,443 | |
| | 3,284 | |
| | (850 | ) |
| | 237 | |
| | 9,113 | |
| | (90 | ) |
| | (148 | ) |
| | (766 | ) |
| | 6,262 | |
| | 5,257 | |
| ACCELERATED DEBT ISSUANCES & MODIFICATION COSTS, |
| | - | |
| | - | |
| | - | |
| | 601 | |
| | 601 | |
| | - | |
| | - | |
| | 358 | |
| | - | |
| | 358 | |
|
| NET OF TAX EFFECT |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| DEPRECIATION & AMORTIZATION TRUE UP, NET OF TAX EFFECT |
| | - | |
| | - | |
| | - | |
| | - | |
| | - | |
| | - | |
| | - | |
| | 1,302 | |
| | - | |
| | 1,302 | |
| OTHER INCOME TAX EXPENSE (BENEFIT) |
| | - | |
| | 9,297 | |
| | (6,719 | ) |
| | 564 | |
| | 3,142 | |
| | - | |
| | 3,160 | |
| | 3,076 | |
| | 2,709 | |
| | 8,945 | |
|
| ADJUSTED EARNINGS FROM CONTINUING OPERATIONS |
| $ | 3,603 | |
| $ | 3,398 | |
| $ | 10,258 | |
| $ | 12,730 | |
| $ | 29,987 | |
| $ | 6,964 | |
| $ | 7,320 | |
| $ | 17,827 | |
| $ | 12,750 | |
| $ | 44,859 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| ADJUSTED DILUTED EARNINGS PER SHARE (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NET EARNINGS (LOSS) (GAAP MEASURE) |
| $ | 0.09 | |
| $ | (0.30 | ) |
| $ | 0.48 | |
| $ | (0.61 | ) |
| $ | (0.35 | ) |
| $ | (0.29 | ) |
| $ | 0.04 | |
| $ | 0.52 | |
| $ | (4.38 | ) |
| $ | (4.04 | ) |
| DISCONTINUED OPERATIONS, NET OF INCOME TAX |
| | 0.13 | |
| | 0.06 | |
| | 0.18 | |
| | (0.80 | ) |
| | (0.43 | ) |
| | (0.02 | ) |
| | 0.07 | |
| | 0.09 | |
| | (4.37 | ) |
| | (4.18 | ) |
|
| EARNINGS FROM CONTINUING OPERATIONS |
| $ | (0.05 | ) |
| $ | (0.36 | ) |
| $ | 0.29 | |
| $ | 0.18 | |
| $ | 0.08 | |
| $ | (0.27 | ) |
| $ | (0.03 | ) |
| $ | 0.43 | |
| $ | (0.01 | ) |
| $ | 0.13 | |
| IMPAIRMENT & DIVESTITURE CHARGES, NET OF TAX EFFECT |
| | - | |
| | 0.21 | |
| | - | |
| | - | |
| | 0.20 | |
| | 0.38 | |
| | 0.10 | |
| | (0.21 | ) |
| | 0.07 | |
| | 0.34 | |
| RESTRUCTURING & OTHER EXIT CHARGES, NET OF TAX EFFECT |
| | 0.11 | |
| | 0.06 | |
| | (0.01 | ) |
| | 0.01 | |
| | 0.15 | |
| | - | |
| | - | |
| | (0.01 | ) |
| | 0.10 | |
| | 0.09 | |
| ACCELERATED DEBT ISSUANCES & MODIFICATION COSTS, |
| | - | |
| | - | |
| | - | |
| | 0.01 | |
| | 0.01 | |
| | - | |
| | - | |
| | 0.01 | |
| | - | |
| | 0.01 | |
|
| NET OF TAX EFFECT |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| DEPRECIATION & AMORTIZATION TRUE UP, NET OF TAX EFFECT |
| | - | |
| | - | |
| | - | |
| | - | |
| | - | |
| | - | |
| | - | |
| | 0.02 | |
| | - | |
| | 0.02 | |
| OTHER INCOME TAX EXPENSE (BENEFIT) |
| | - | |
| | 0.15 | |
| | (0.11 | ) |
| | 0.01 | |
| | 0.05 | |
| | - | |
| | 0.05 | |
| | 0.05 | |
| | 0.05 | |
| | 0.14 | |
|
| ADJUSTED DILUTED EARNINGS PER SHARE FROM CONTINUING OPERATIONS |
| $ | 0.06 | |
| $ | 0.06 | |
| $ | 0.17 | |
| $ | 0.21 | |
| $ | 0.49 | |
| $ | 0.11 | |
| $ | 0.12 | |
| $ | 0.29 | |
| $ | 0.21 | |
| $ | 0.73 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| ADJUSTED EBITDA CONTINUING OPERATIONS (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| EARNINGS (LOSS) FROM CONTINUING OPERATIONS |
| $ | (2,840 | ) |
| $ | (21,568 | ) |
| $ | 17,827 | |
| $ | 11,328 | |
| $ | 4,746 | |
| $ | (16,423 | ) |
| $ | (1,804 | ) |
| $ | 26,858 | |
| $ | (564 | ) |
| $ | 8,067 | |
| FINANCING COSTS, NET |
| | 7,356 | |
| | 7,462 | |
| | 7,636 | |
| | 8,417 | |
| | 30,872 | |
| | 7,298 | |
| | 7,157 | |
| | 7,146 | |
| | 6,563 | |
| | 28,163 | |
| INCOME TAX EXPENSE (BENEFIT) |
| | 763 | |
| | 18,956 | |
| | (5,170 | ) |
| | (99 | ) |
| | 14,450 | |
| | 66 | |
| | 4,002 | |
| | 4,962 | |
| | 1,626 | |
| | 10,657 | |
| DEPRECIATION & AMORTIZATION |
| | 4,940 | |
| | 5,092 | |
| | 5,214 | |
| | 5,159 | |
| | 20,405 | |
| | 5,056 | |
| | 4,305 | |
| | 6,109 | |
| | 4,746 | |
| | 20,217 | |
|
| EBITDA |
| $ | 10,219 | |
| $ | 9,942 | |
| $ | 25,507 | |
| $ | 24,805 | |
| $ | 70,473 | |
| $ | (4,003 | ) |
| $ | 13,660 | |
| $ | 45,075 | |
| $ | 12,371 | |
| $ | 67,104 | |
| IMPAIRMENT & OTHER DIVESTITURE CHARGES |
| | - | |
| | 2,987 | |
| | - | |
| | - | |
| | 2,987 | |
| | 23,477 | |
| | 6,112 | |
| | (12,988 | ) |
| | 6,227 | |
| | 22,827 | |
| RESTRUCTURING & OTHER EXIT CHARGES |
| | 6,331 | |
| | 3,527 | |
| | 805 | |
| | 742 | |
| | 11,404 | |
| | (29 | ) |
| | 46 | |
| | 1,115 | |
| | 4,842 | |
| | 5,973 | |
| DEBT MODIFICATION COSTS |
| | - | |
| | - | |
| | - | |
| | - | |
| | - | |
| | - | |
| | - | |
| | 288 | |
| | - | |
| | 288 | |
|
| ADJUSTED EBITDA |
| $ | 16,550 | |
| $ | 16,456 | |
| $ | 26,312 | |
| $ | 25,547 | |
| $ | 84,864 | |
| $ | 19,445 | |
| $ | 19,818 | |
| $ | 33,490 | |
| $ | 23,440 | |
| $ | 96,192 | |
| FOOTNOTES |
| Note: The total of the individual quarters may not equal the annual or year-to-date total due to rounding. The continuing operations and discontinued operations earning (loss) per share may not equal total earning (loss) per share due to rounding. |
|
|
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| |
(1) |
| Adjusted earnings from continuing operations and adjusted diluted earnings per share represent net earnings (loss) and diluted earnings (loss) per share per the Condensed Consolidated Statements of Operations net of charges or credits for items to be highlighted for comparability purposes. These measures are not calculated based upon generally accepted accounting principles (GAAP) and should not be considered as an alternative to net earnings (loss) or diluted earnings (loss) per share or 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 and the impact of share dilution on the calculation of the net loss per share and discontinued operations per share. |
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| |
(2) |
| EBITDA represents net earnings (loss) from continuing operations before financing costs, net, income tax (benefit) expense, and depreciation & amortization. EBITDA is not a calculation based upon GAAP. The amounts included in the EBITDA and Adjusted EBITDA calculation, however, are derived from amounts included in the Condensed Consolidated Statements of Operations. EBITDA should not be considered as an alternative to net earnings (loss), operating profit (loss) or operating cash flows. Actuant has presented EBITDA because it regularly reviews this performance measure. In addition, EBITDA is used by many of our investors and lenders, and is presented as a convenience to them. 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. |
| ACTUANT CORPORATION |
|
|
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|
|
| SUPPLEMENTAL UNAUDITED DATA |
|
|
|
|
|
| RECONCILIATION OF GAAP TO NON-GAAP GUIDANCE |
|
|
|
|
|
| (Dollars in millions, except for per share amounts) |
|
|
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| |
|
|
|
| Q1 FISCAL 2020 |
| FISCAL 2020 |
|
|
|
| LOW | HIGH |
| LOW | HIGH |
| RECONCILIATION OF CONTINUING OPERATIONS GAAP DILUTED EARNINGS |
|
|
|
|
|
| PER SHARE TO ADJUSTED DILUTED EARNINGS PER SHARE GUIDANCE |
|
|
|
|
|
| GAAP DILUTED EARNINGS PER SHARE | $ | (0.02) | $ | 0.07 |
| $ | 0.39 | $ | 0.65 |
| IMPAIRMENT & OTHER DIVESTITURE CHARGES, NET OF TAX EFFECT | TBD | TBD |
| TBD | TBD |
| RESTRUCTURING CHARGES, NET OF TAX EFFECT | | 0.10 | | 0.05 |
| | 0.29 | | 0.16 |
| OTHER INCOME TAX (BENEFIT) EXPENSE | TBD | TBD |
| TBD | TBD |
|
| ADJUSTED DILUTED EARNINGS PER SHARE GUIDANCE | $ | 0.08 | $ | 0.12 |
| $ | 0.68 | $ | 0.81 |
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| |
| RECONCILIATION OF CONTINUED OPERATIONS GAAP OPERATING PROFIT |
|
|
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|
|
| TO ADJUSTED EBITDA |
|
|
|
|
|
| GAAP OPERATING PROFIT | $ | 5.0 | $ | 12.0 |
| $ | 43 | $ | 63 |
| RESTRUCTURING CHARGES | | 8.0 | | 4.0 |
| | 22 | | 12 |
|
| ADJUSTED OPERATING PROFIT | $ | 13.0 | $ | 16.0 |
| $ | 65 | $ | 75 |
| OTHER EXPENSE (INCOME), NET | | (0.5) | | (0.5) |
| | 8 | | 8 |
| DEPRECIATION & AMORTIZATION | | 5.0 | | 5.0 |
| | 21 | | 21 |
|
| ADJUSTED EBITDA | $ | 17.5 | $ | 20.5 |
| $ | 94 | $ | 104 |
|
|
|
|
|
|
|
| |
| RECONCILIATION OF GAAP CASH FLOW FROM OPERATIONS TO FREE CASH FLOW |
|
|
|
|
|
| CASH FLOW FROM OPERATIONS |
|
|
| $ | 62 | $ | 85 |
| CAPITAL EXPENDITURES |
|
|
| | (12) | | (10) |
| OTHER |
|
|
| | - | | - |
|
| FREE CASH FLOW GUIDANCE |
|
|
| $ | 50 | $ | 75 |
|
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| |
| FOOTNOTES |
|
|
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|
|
| NOTE: | Management does not provide guidance on GAAP financial measures as we are unable to predict and estimate with certainty items such as potential impairments, refinancing costs, business divestiture gains/losses, discrete tax adjustments, or other items impacting GAAP financial metrics. As a result, we have included above only those items about which we are aware and are reasonably likely to occur during the guidance period covered. |
