Press Release Details
Colfax Reports Record Second Quarter 2013 Results
COLFAX REPORTS RECORD SECOND QUARTER 2013 RESULTS
FULTON, MD - July 25, 2013 -
Second Quarter of 2013 (all comparisons versus the second quarter of 2012)
-
Net income of
$53.3 million ($0.52 per dilutive share); adjusted net income (as defined below) of $62.0 million ($0.56 per share, which includes a$0.02 per share gain related to the resolution of a previous tax position) -
Net sales of
$1.074 billion , an increase of 2.7% from Q2 2012 net sales (an organic decrease of 0.3%) -
Operating income of
$111.7 million ; adjusted operating income (as defined below) of$116.6 million -
Second quarter gas- and fluid-handling orders of
$478.2 million compared to orders of$534.5 million in Q2 2012, a decrease of 10.5% (an organic decrease of 10.0%) -
Gas- and fluid-handling backlog of
$1.388 billion at period end
Six Months Ended June 28, 2013 (all comparisons versus the six months ended
-
Net income of
$75.9 million ($0.74 per dilutive share); adjusted net income (as defined below) of$95.5 million ($0.83 per share) -
Net sales of
$2.021 billion , an increase of 4.6% from net sales for the six months endedJune 29, 2012 (an organic decrease of 1.4%) -
Operating income of
$184.0 million ; adjusted operating income (as defined below) of$194.8 million -
Gas- and fluid-handling orders of
$980.3 million , a decrease of 5.0% (an organic decrease of 7.3%)
Adjusted net income, adjusted net income per share, adjusted operating income, organic sales growth (decrease) and organic order growth (decrease) are not financial measures calculated in accordance with generally accepted accounting principles in the U.S. ("GAAP"). See below for a description of the measures' usefulness and a reconciliation of these measures to their most directly comparable GAAP financial measures.
Non-GAAP Financial Measures and Other Adjustments
Colfax has provided in this press release financial information that has not been prepared in accordance with GAAP. These non-GAAP financial measures are adjusted net income, adjusted net income per share, adjusted operating income, organic sales growth (decrease) and organic order growth (decrease). Adjusted net income, adjusted net income per share and adjusted operating income exclude asbestos coverage litigation expense, restructuring and other related charges, expenses related to the Charter acquisition and fair value adjustments related to the ESAB and Howden inventory and backlog amortization expense to the extent they impact the periods presented. The effective tax rates
used to calculate adjusted net income and adjusted net income per share are 28.2% and 29.0% for the second quarter and six months ended
Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information calculated in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures. A reconciliation of non-GAAP financial measures presented above to GAAP results has been provided in the financial tables included in this press release.
Conference Call and Webcast
Colfax will host a conference call to provide details about its results on
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CAUTIONARY NOTE CONCERNING FORWARD LOOKING STATEMENTS:
This press release may contain forward-looking statements, including forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements concerning Colfax's plans, objectives, expectations and intentions and other statements that are not historical or
current fact. Forward-looking statements are based on Colfax's current expectations and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such forward-looking statements. Factors that could cause Colfax's results to differ materially from current expectations include, but are not limited to factors detailed in Colfax's reports filed with the
The term "Colfax" in reference to the activities described in this press release may
mean one or more of Colfax's global operating subsidiaries and/or their internal business divisions and does not necessarily indicate activities engaged in by
Contact:
Farand Pawlak, Director of Investor Relations
301-323-9054
Condensed Consolidated Statements of Operations
Dollars in thousands, except per share data
(Unaudited)
Three Months Ended | Six Months Ended | |||||||||||||||||||||
| |
| | |||||||||||||||||||
Net sales | $ | 1,074,118 | $ | 1,045,653 | $ | 2,021,261 | $ | 1,932,019 | ||||||||||||||
Cost of sales | 736,296 | 730,791 | 1,392,714 | 1,375,451 | ||||||||||||||||||
Gross profit | 337,822 | 314,862 | 628,547 | 556,568 | ||||||||||||||||||
Selling, general and administrative expense | 221,225 | 231,992 | 433,703 | 444,048 | ||||||||||||||||||
Charter acquisition-related expense | - | 766 | - | 43,617 | ||||||||||||||||||
Restructuring and other related charges | 4,477 | 18,558 | 8,691 | 27,201 | ||||||||||||||||||
Asbestos coverage litigation expense | 468 | 3,240 | 2,174 | 5,527 | ||||||||||||||||||
Operating income | 111,652 | 60,306 | 183,979 | 36,175 | ||||||||||||||||||
Interest expense | 18,054 | 25,741 | 41,343 | 44,723 | ||||||||||||||||||
Income (loss) before income taxes | 93,598 | 34,565 | 142,636 | (8,548 | ) | |||||||||||||||||
Provision for income taxes(1) | 26,398 | 15,933 | 43,161 | 73,281 | ||||||||||||||||||
Net income (loss) | 67,200 | 18,632 | 99,475 | (81,829 | ) | |||||||||||||||||
Less: income attributable to noncontrolling interest, net of taxes | 8,808 | 6,266 | 13,448 | 11,403 | ||||||||||||||||||
Net income (loss) attributable to | 58,392 | 12,366 | 86,027 | (93,232 | ) | |||||||||||||||||
Dividends on preferred stock | 5,086 | 5,073 | 10,168 | 8,807 | ||||||||||||||||||
Net income (loss) available to | $ | 53,306 | $ | 7,293 | $ | 75,859 | $ | (102,039 | ) | |||||||||||||
Net income (loss) per share- basic | $ | 0.53 | $ | 0.07 | $ | 0.75 | $ | (1.16 | ) | |||||||||||||
Net income (loss) per share- diluted | $ | 0.52 | $ | 0.07 | $ | 0.74 | $ | (1.16 | ) |
__________
(1) Provision for income taxes for the six months ended
Reconciliation of GAAP to Non-GAAP Financial Measures
Dollars in thousands, except per share data
(Unaudited)
Three Months Ended | Six Months Ended | ||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||
Adjusted Operating Income | |||||||||||||||
Operating income | $ | 111,652 | $ | 60,306 | $ | 183,979 | $ | 36,175 | |||||||
Restructuring and other related charges | 4,477 | 18,558 | 8,691 | 27,201 | |||||||||||
Charter acquisition-related expense | - | 766 | - | 43,617 | |||||||||||
Fair value adjustments - ESAB/Howden backlog and inventory amortization expense | - | 14,422 | - | 48,127 | |||||||||||
Asbestos coverage litigation expense | 468 | 3,240 | 2,174 | 5,527 | |||||||||||
Adjusted operating income | $ | 116,597 | $ | 97,292 | $ | 194,844 | $ | 160,647 | |||||||
Adjusted operating income margin | 10.9 | % | 9.3 | % | 9.6 | % | 8.3 | % |
Adjusted Net Income and Adjusted Net Income Per Share | |||||||||||||||
Net income (loss) attributable to | $ | 58,392 | $ | 12,366 | $ | 86,027 | $ | (93,232 | ) | ||||||
Restructuring and other related charges | 4,477 | 18,558 | 8,691 | 27,201 | |||||||||||
Charter acquisition-related expense | - | 766 | - | 43,617 | |||||||||||
Fair value adjustments - ESAB/Howden backlog and inventory amortization expense | - | 14,422 | - | 48,127 | |||||||||||
Asbestos coverage litigation expense | 468 | 3,240 | 2,174 | 5,527 | |||||||||||
Tax adjustment(1) | (1,354 | ) | (6,247 | ) | (1,354 | ) | 37,345 | ||||||||
Adjusted net income | 61,983 | 43,105 | 95,538 | 68,585 | |||||||||||
Adjusted net income margin | 5.8 | % | 4.1 | % | 4.7 | % | 3.5 | % | |||||||
Dividends on preferred stock | 5,086 | 5,073 | 10,168 | 8,807 | |||||||||||
Adjusted net income available to | 56,897 | 38,032 | 85,370 | 59,778 | |||||||||||
Less: adjusted net income attributable to participating securities(2) | 916 | 4,859 | 4,571 | 7,129 | |||||||||||
$ | 55,981 | $ | 33,173 | $ | 80,799 | $ | 52,649 | ||||||||
Weighted-average shares outstanding - diluted | 111,522,958 | 94,733,164 | 97,285,037 | 88,825,431 | |||||||||||
Adjusted net income per share | $ | 0.56 | $ | 0.35 | $ | 0.83 | $ | 0.59 | |||||||
Net income (loss) per share- basic (in accordance with GAAP) | $ | 0.53 | $ | 0.07 | $ | 0.75 | $ | (1.16 | ) | ||||||
Net income (loss) per share- diluted (in accordance with GAAP) | 0.52 | 0.07 | 0.74 | (1.16 | ) |
__________
(1) The effective tax rates used to calculate adjusted net income and adjusted net income per share are 28.2% and 29.0% for
the second quarter and six months ended
(2) Adjusted net income per share for periods prior to
Change in Sales, Orders and Backlog
Dollars in millions
(Unaudited)
Net Sales | Orders | |||||||||||||||||||
$ | % | $ | % | |||||||||||||||||
For the three months ended | $ | 1,045.7 | $ | 534.5 | ||||||||||||||||
Components of Change: | ||||||||||||||||||||
Existing Businesses | (2.7 | ) | (0.3 | )% | (53.6 | ) | (10.0 | )% | ||||||||||||
Acquisitions(1) | 37.4 | 3.6 | % | 6.0 | 1.1 | % | ||||||||||||||
Foreign Currency Translation | (6.3 | ) | (0.6 | )% | (8.7 | ) | (1.6 | )% | ||||||||||||
Total | 28.4 | 2.7 | % | (56.3 | ) | (10.5 | )% | |||||||||||||
For the three months ended | $ | 1,074.1 | $ | 478.2 | ||||||||||||||||
Net Sales | Orders | Backlog at Period End | ||||||||||||||||||
$ | % | $ | % | $ | % | |||||||||||||||
As of and for the six months ended | $ | 1,932.0 | $ | 1,032.0 | $ | 1,375.9 | ||||||||||||||
Components of Change: | ||||||||||||||||||||
Existing Businesses | (26.7 | ) | (1.4 | )% | (75.1 | ) | (7.3 | )% | 23.2 | 1.7 | % | |||||||||
Acquisitions (1) | 142.6 | 7.4 | % | 39.5 | 3.8 | % | 21.2 | 1.5 | % | |||||||||||
Foreign Currency Translation | (26.6 | ) | (1.4 | )% | (16.1 | ) | (1.5 | )% | (31.9 | ) | (2.3 | )% | ||||||||
Total | 89.3 | 4.6 | % | (51.7 | ) | (5.0 | )% | 12.5 | 0.9 | % | ||||||||||
As of and for the six months ended | $ | 2,021.3 | $ | 980.3 | $ | 1,388.4 |
(1) Represents the incremental sales, orders and order backlog as a result of our acquisitions of Charter, Soldex and Co-Vent. The impact related to the Charter Acquisition represents 12 days of activity for ESAB and Howden as the acquisition closed on
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