Motorcar Parts of America, Inc. (Nasdaq:MPAA) today reported
results for its fiscal 2017 second quarter -- reflecting record
profitability on both a reported and adjusted basis.
Net sales for the fiscal 2017 second quarter were $108.8 million
compared with $91.7 million for the same period a year earlier. The
company’s sales performance for the fiscal 2017 second quarter
reflects continued strength of its rotating electrical and wheel
hub business, as well as contributions from its other product lines
-- including the company’s emerging brake power boosters, which
commenced in August. Sales were partially offset by certain
customer allowances and return accruals related to new
business.
All results labeled as “adjusted” in this press release are
non-GAAP measures as discussed more fully below under the heading
“Use of Non-GAAP Measures.”
Adjusted net sales for the fiscal 2017 second quarter were
$112.4 million compared with $101.7 million a year earlier.
Net income for the fiscal 2017 second quarter was $9.1 million,
or $0.47 per diluted share, compared with a net loss of $1.4
million, or $0.08 per share, a year ago.
Adjusted net income for the fiscal 2017 second quarter was $12.4
million, or $0.64 per diluted share, compared with $11.8 million,
or $0.62 per diluted share, in the same period a year earlier.
Gross profit for the fiscal 2017 second quarter was $30.7
million compared with $21.8 million a year earlier. Gross
profit as a percentage of net sales for the fiscal 2017 second
quarter was 28.2 percent compared with 23.8 percent a year earlier,
primarily due to customer allowances related to new business.
Adjusted gross profit for the fiscal 2017 second quarter was
$34.5 million compared with $31.4 million a year ago.
Adjusted gross profit as a percentage of adjusted net sales for the
three months was 30.7 percent compared with 30.9 percent a year
earlier.
Net sales for the fiscal 2017 six-month period were $194.2
million compared with $177.5 million a year earlier.
Adjusted net sales for the six-month period were $206.2 million
compared with $188.4 million last year.
Net income for the six-month period was $16.7 million, or $0.86
per diluted share, compared with $518,000, or $0.03 per diluted
share, in fiscal 2016.
Adjusted net income for the first half of fiscal 2017 was $22.5
million, or $1.16 per diluted share, compared with $20.1 million,
or $1.07 per diluted share, in fiscal 2016.
Gross profit for the fiscal 2017 six-month period was $51.0
million compared with $47.8 million a year earlier. Gross
profit as a percentage of net sales for the fiscal 2017 first half
was 26.3 percent compared with 26.9 percent a year earlier,
primarily due to customer allowances related to new business.
Adjusted gross profit for the fiscal 2017 the six-month period
was $64.8 million compared with $58.2 million a year ago.
Adjusted gross profit as a percentage of adjusted net sales for the
six months was 31.4 percent compared with 30.9 percent a year
earlier.
“As we commence the second half of fiscal 2017, we are
well-positioned within the aftermarket industry. We
anticipate solid growth in all of our product lines, and we are
encouraged by the numerous additional opportunities we are seeing,”
said Selwyn Joffe, chairman, president and chief executive officer
of Motorcar Parts of America.
“Results for the quarter reflect continued strength of our
business – supported by an aging vehicle population, increased
miles driven and related factors, all of which continue to
contribute to overall growth in the aftermarket industry. As
always, we thank our entire team for their day-in and day-out
commitment to excellence and our company,” Joffe said.
Use of Non-GAAP Measures
This press release includes the following non-GAAP measures -
adjusted net sales, adjusted net income (loss), adjusted EBITDA,
adjusted gross profit and adjusted gross margin, which are not
measures of financial performance under GAAP, and should not be
considered as alternatives to net sales, net income (loss), EBITDA,
income from operations, gross profit or gross profit margin as a
measure of financial performance. The Company believes these
non-GAAP measures, when considered together with the corresponding
GAAP measures, provide useful information to investors and
management regarding financial and business trends relating to the
company’s results of operations. However, these non-GAAP
measures have significant limitations in that they do not reflect
all of the costs associated with the operations of the company’s
business as determined in accordance with GAAP. Therefore,
investors should consider non-GAAP measures in addition to, and not
as a substitute for, or superior to, measures of financial
performance in accordance with GAAP. For a reconciliation of
adjusted net sales, adjusted net income (loss), adjusted EBITDA,
adjusted gross profit and adjusted gross margin to their
corresponding GAAP measures, see the financial tables included in
this press release. Also, refer to our Form 8-K to which this
release is attached, and other filings we make with the SEC, for
further information regarding these adjustments.
Teleconference and Web Cast
Selwyn Joffe, chairman, president and chief executive officer,
and David Lee, chief financial officer, will host an investor
conference call today at 10:00 a.m. Pacific time to discuss the
company’s financial results and operations.
The call this morning will be open to all interested investors
either through a live audio Web broadcast at www.motorcarparts.com
or live by calling (877)-776-4016 (domestic) or (973)-638-3231
(international). For those who are not available to listen to
the live broadcast, the call will be archived for seven days on
Motorcar Parts of America’s website www.motorcarparts.com. A
telephone playback of the conference call will also be available
from approximately 1:00 p.m. Pacific time on November 9, 2016
through 8:59 p.m. Pacific time on Wednesday, November 16, 2016 by
calling (855)-859-2056 (domestic) or (404)-537-3406 (international)
and using access code: 5599020.
About Motorcar Parts of America, Inc.
Motorcar Parts of America is a remanufacturer, manufacturer and
distributor of automotive aftermarket parts -- including
alternators, starters, wheel hub assembly products, brake master
cylinders, brake power boosters and turbochargers utilized in
imported and domestic passenger vehicles, light trucks and heavy
duty applications. Motorcar Parts of America’s products are sold to
automotive retail outlets and the professional repair market
throughout the United States and Canada, with facilities located in
California, Mexico, Malaysia and China, and administrative offices
located in California, Tennessee, Virginia, Mexico, Singapore,
Malaysia and Toronto. Additional information is available at
www.motorcarparts.com.
The Private Securities Litigation Reform Act of 1995 provides a
“safe harbor” for certain forward-looking statements. The
statements contained in this press release that are not historical
facts are forward-looking statements based on the company’s current
expectations and beliefs concerning future developments and their
potential effects on the company. These forward-looking statements
involve significant risks and uncertainties (some of which are
beyond the control of the company) and are subject to change based
upon various factors. Reference is also made to the Risk
Factors set forth in the company’s Form 10-K Annual Report filed
with the Securities and Exchange Commission (SEC) in June 2016 and
in its Forms 10-Q filed with the SEC for additional risks and
uncertainties facing the company. The company undertakes no
obligation to publicly update or revise any forward-looking
statements, whether as the result of new information, future events
or otherwise.
(Financial tables follow)
MOTORCAR PARTS OF AMERICA, INC. AND
SUBSIDIARIESConsolidated Statements of
Income(Unaudited) |
|
|
|
|
|
|
|
Three Months Ended |
|
Six Months Ended |
|
|
September
30, |
|
September
30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
108,836,000 |
|
|
$ |
91,670,000 |
|
|
$ |
194,248,000 |
|
|
$ |
177,505,000 |
|
Cost of goods sold |
|
|
78,178,000 |
|
|
|
69,850,000 |
|
|
|
143,199,000 |
|
|
|
129,694,000 |
|
Gross profit |
|
|
30,658,000 |
|
|
|
21,820,000 |
|
|
|
51,049,000 |
|
|
|
47,811,000 |
|
Operating
expenses: |
|
|
|
|
|
|
|
General and administrative |
|
|
9,869,000 |
|
|
|
18,219,000 |
|
|
|
13,494,000 |
|
|
|
29,579,000 |
|
Sales and marketing |
|
|
2,707,000 |
|
|
|
2,632,000 |
|
|
|
5,341,000 |
|
|
|
4,912,000 |
|
Research and development |
|
|
905,000 |
|
|
|
646,000 |
|
|
|
1,774,000 |
|
|
|
1,382,000 |
|
Total operating expenses |
|
|
13,481,000 |
|
|
|
21,497,000 |
|
|
|
20,609,000 |
|
|
|
35,873,000 |
|
Operating income |
|
|
17,177,000 |
|
|
|
323,000 |
|
|
|
30,440,000 |
|
|
|
11,938,000 |
|
Interest expense, net |
|
|
3,189,000 |
|
|
|
2,613,000 |
|
|
|
6,008,000 |
|
|
|
11,050,000 |
|
Income
(loss) before income tax expense (benefit) |
|
|
13,988,000 |
|
|
|
(2,290,000 |
) |
|
|
24,432,000 |
|
|
|
888,000 |
|
Income
tax expense (benefit) |
|
|
4,845,000 |
|
|
|
(898,000 |
) |
|
|
7,781,000 |
|
|
|
370,000 |
|
|
|
|
|
|
|
|
|
|
Net
income (loss) |
|
$ |
9,143,000 |
|
|
$ |
(1,392,000 |
) |
|
$ |
16,651,000 |
|
|
$ |
518,000 |
|
|
|
|
|
|
|
|
|
|
Basic net income (loss) per
share |
|
$ |
0.49 |
|
|
$ |
(0.08 |
) |
|
$ |
0.90 |
|
|
$ |
0.03 |
|
|
|
|
|
|
|
|
|
|
Diluted net income
(loss) per share |
$ |
0.47 |
|
|
$ |
(0.08 |
) |
|
$ |
0.86 |
|
|
$ |
0.03 |
|
|
|
|
|
|
|
|
|
|
Weighted
average number of shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
18,641,324 |
|
|
|
18,215,783 |
|
|
|
18,544,118 |
|
|
|
18,109,912 |
|
|
|
|
|
|
|
|
|
|
Diluted |
|
|
19,429,390 |
|
|
|
18,215,783 |
|
|
|
19,384,668 |
|
|
|
18,887,153 |
|
|
|
|
|
|
|
|
|
|
MOTORCAR PARTS OF AMERICA, INC. AND
SUBSIDIARIESConsolidated Balance
Sheets |
|
|
|
September 30, 2016 |
|
March 31, 2016 |
|
ASSETS |
|
(Unaudited) |
|
|
|
Current assets: |
|
|
|
|
Cash and cash
equivalents |
|
$ |
5,452,000 |
|
|
$ |
21,897,000 |
|
|
Short-term investments |
|
|
2,233,000 |
|
|
|
1,813,000 |
|
|
Accounts receivable —
net |
|
|
16,112,000 |
|
|
|
8,548,000 |
|
|
Inventory — net |
|
|
72,164,000 |
|
|
|
58,060,000 |
|
|
Inventory unreturned |
|
|
10,228,000 |
|
|
|
10,520,000 |
|
|
Deferred income taxes |
|
|
34,414,000 |
|
|
|
33,347,000 |
|
|
Prepaid expenses and other
current assets |
|
|
7,796,000 |
|
|
|
5,900,000 |
|
|
Total current assets |
|
|
148,399,000 |
|
|
|
140,085,000 |
|
|
Plant and equipment — net |
|
|
17,227,000 |
|
|
|
16,099,000 |
|
|
Long-term core inventory — net |
|
|
251,048,000 |
|
|
|
241,100,000 |
|
|
Long-term core inventory deposits |
|
|
5,569,000 |
|
|
|
5,569,000 |
|
|
Long-term deferred income taxes |
|
|
457,000 |
|
|
|
236,000 |
|
|
Goodwill |
|
|
2,476,000 |
|
|
|
2,053,000 |
|
|
Intangible assets — net |
|
|
4,316,000 |
|
|
|
4,573,000 |
|
|
Other assets |
|
|
8,176,000 |
|
|
|
3,657,000 |
|
|
TOTAL ASSETS |
|
$ |
437,668,000 |
|
|
$ |
413,372,000 |
|
|
LIABILITIES AND
SHAREHOLDERS'
EQUITY |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts payable |
|
$ |
74,845,000 |
|
|
$ |
72,152,000 |
|
|
Accrued liabilities |
|
|
6,938,000 |
|
|
|
9,101,000 |
|
|
Customer finished goods
returns accrual |
|
|
19,761,000 |
|
|
|
26,376,000 |
|
|
Accrued core payment |
|
|
11,174,000 |
|
|
|
8,989,000 |
|
|
Revolving loan |
|
|
19,000,000 |
|
|
|
7,000,000 |
|
|
Other current
liabilities |
|
|
9,757,000 |
|
|
|
4,698,000 |
|
|
Current portion of term
loan |
|
|
3,064,000 |
|
|
|
3,067,000 |
|
|
Total current
liabilities |
|
|
144,539,000 |
|
|
|
131,383,000 |
|
|
Term loan, less current portion |
|
|
18,447,000 |
|
|
|
19,980,000 |
|
|
Long-term accrued core payment |
|
|
17,996,000 |
|
|
|
17,550,000 |
|
|
Long-term deferred income taxes |
|
|
13,675,000 |
|
|
|
14,315,000 |
|
|
Other liabilities |
|
|
14,187,000 |
|
|
|
19,336,000 |
|
|
Total liabilities |
|
|
208,844,000 |
|
|
|
202,564,000 |
|
|
Commitments and contingencies |
|
|
|
|
|
Shareholders' equity: |
|
|
|
|
|
Preferred stock; par value
$.01 per share, 5,000,000 shares authorized; none issued |
|
|
- |
|
|
|
- |
|
|
Series A junior participating
preferred stock; par value $.01 per share, |
|
|
|
|
|
20,000 shares authorized;
none issued |
|
|
- |
|
|
|
- |
|
|
Common stock; par value $.01
per share, 50,000,000 shares authorized; |
|
|
|
|
|
18,665,196 and 18,531,751
shares issued and outstanding at September 30, 2016 and |
|
|
|
|
|
|
|
|
|
March 31, 2016,
respectively |
|
|
187,000 |
|
|
|
185,000 |
|
|
Additional paid-in
capital |
|
|
205,375,000 |
|
|
|
203,650,000 |
|
|
Retained earnings |
|
|
29,368,000 |
|
|
|
11,825,000 |
|
|
Accumulated other
comprehensive loss |
|
|
(6,106,000 |
) |
|
|
(4,852,000 |
) |
|
Total shareholders'
equity |
|
|
228,824,000 |
|
|
|
210,808,000 |
|
|
TOTAL LIABILITIES AND
SHAREHOLDERS’ EQUITY |
|
$ |
437,668,000 |
|
|
$ |
413,372,000 |
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Financial
Measures
To supplement the consolidated financial statements presented in
accordance with U.S. generally accepted accounting principles
("GAAP"), the Company has included the following non-GAAP adjusted
financial measures in this press release and in the webcast to
discuss the Company's financial results for the three and six
months ended September 30, 2016 and 2015. Each of these non-GAAP
adjusted financial measures is adjusted from results based on GAAP
to exclude certain expenses and gains. Among other things,
the Company uses such non-GAAP adjusted financial measures in
addition to and in conjunction with corresponding GAAP measures to
help analyze the performance of its business.
These non-GAAP adjusted financial measures reflect an additional
way of viewing aspects of the Company's operations that, when
viewed with the GAAP results and the reconciliations to
corresponding GAAP financial measures, provide a more complete
understanding of the Company's results of operations and the
factors and trends affecting the Company's business. However,
these non-GAAP adjusted financial measures should be considered as
a supplement to, and not as a substitute for, or superior to, the
corresponding measures calculated in accordance with GAAP.
Income statement information for the three and six months ended
September 30, 2016 and 2015 are as follows:
Reconciliation of Non-GAAP Financial
Measures |
|
|
|
|
|
|
|
|
|
|
Exhibit 1 |
|
|
|
|
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
GAAP Results: |
|
|
|
|
|
|
Net sales |
$ |
108,836,000 |
|
|
$ |
91,670,000 |
|
|
$ |
194,248,000 |
|
|
$ |
177,505,000 |
|
Net income (loss) |
|
9,143,000 |
|
|
|
(1,392,000 |
) |
|
|
16,651,000 |
|
|
|
518,000 |
|
Diluted income (loss) per share
(EPS) |
|
0.47 |
|
|
|
(0.08 |
) |
|
|
0.86 |
|
|
|
0.03 |
|
Gross margin |
|
28.2 |
% |
|
|
23.8 |
% |
|
|
26.3 |
% |
|
|
26.9 |
% |
Non-GAAP Adjusted Results: |
|
|
|
|
|
Non-GAAP adjusted net sales |
$ |
112,383,000 |
|
|
$ |
101,745,000 |
|
|
$ |
206,205,000 |
|
|
$ |
188,368,000 |
|
Non-GAAP adjusted net income |
|
12,426,000 |
|
|
|
11,790,000 |
|
|
|
22,516,000 |
|
|
|
20,144,000 |
|
Non-GAAP adjusted diluted earnings
per share (EPS) |
|
0.64 |
|
|
|
0.62 |
|
|
|
1.16 |
|
|
|
1.07 |
|
Non-GAAP adjusted gross margin |
|
30.7 |
% |
|
|
30.9 |
% |
|
|
31.4 |
% |
|
|
30.9 |
% |
Non-GAAP adjusted EBITDA |
|
24,470,000 |
|
|
|
22,681,000 |
|
|
|
44,689,000 |
|
|
|
40,396,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Financial
Measures |
|
|
Exhibit 2 |
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
GAAP net sales |
$ |
108,836,000 |
|
|
$ |
91,670,000 |
|
|
$ |
194,248,000 |
|
|
$ |
177,505,000 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Net
sales |
|
|
|
|
|
|
|
|
Initial return and stock adjustment
accruals related to new business |
|
1,315,000 |
|
|
|
- |
|
|
|
3,168,000 |
|
|
|
- |
|
|
Customer allowances related to new
business |
|
2,232,000 |
|
|
|
10,075,000 |
|
|
|
8,789,000 |
|
|
|
10,863,000 |
|
Adjusted net sales |
$ |
112,383,000 |
|
|
$ |
101,745,000 |
|
|
$ |
206,205,000 |
|
|
$ |
188,368,000 |
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Financial Measures |
Exhibit
3 |
|
|
|
|
|
Three Months Ended September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
$ |
|
Per Diluted
Share |
|
$ |
|
Per Diluted
Share |
GAAP net income (loss) |
$ |
9,143,000 |
|
|
$ |
0.47 |
|
|
$ |
(1,392,000 |
) |
|
$ |
(0.08 |
) |
Adjustments: |
|
|
|
|
|
|
|
|
Net
sales |
|
|
|
|
|
|
|
|
Initial return and stock adjustment
accruals related to new business |
|
1,315,000 |
|
|
$ |
0.07 |
|
|
|
- |
|
|
$ |
- |
|
|
Customer allowances related to new
business |
|
2,232,000 |
|
|
$ |
0.11 |
|
|
|
10,075,000 |
|
|
$ |
0.53 |
|
|
Cost of goods sold |
|
|
|
|
|
|
|
New product line start-up
costs |
|
16,000 |
|
|
$ |
0.001 |
|
|
|
- |
|
|
$ |
- |
|
|
Lower of cost or market revaluation
- cores on customers' shelves and inventory step-up
amortization |
|
475,000 |
|
|
$ |
0.02 |
|
|
|
326,000 |
|
|
$ |
0.02 |
|
|
Cost of customer allowances and
stock adjustment accruals related to new business |
|
(213,000 |
) |
|
$ |
(0.01 |
) |
|
|
(809,000 |
) |
|
$ |
(0.04 |
) |
|
Operating expenses |
|
|
|
|
|
|
|
Legal, severance, acquisition,
financing, transition and other costs |
|
219,000 |
|
|
$ |
0.01 |
|
|
|
1,112,000 |
|
|
$ |
0.06 |
|
|
Payment received in connection with
the settlement of litigation related to discontinued
subsidiaries |
|
|
|
|
|
|
|
|
Bad debt expense (recovery)
resulting from the bankruptcy filing by a customer |
|
|
|
|
|
|
|
|
Accrual made in connection with the
settlement of litigation, net of insurance recoveries, related to
discontinued subsidiaries |
|
- |
|
|
$ |
- |
|
|
|
9,250,000 |
|
|
$ |
0.49 |
|
|
Share-based compensation
expenses |
|
1,008,000 |
|
|
$ |
0.05 |
|
|
|
517,000 |
|
|
$ |
0.03 |
|
|
Mark-to-market losses (gains) |
|
1,331,000 |
|
|
$ |
0.07 |
|
|
|
1,147,000 |
|
|
$ |
0.06 |
|
|
Tax
effected at 39% tax rate (a) |
|
(3,100,000 |
) |
|
$ |
(0.16 |
) |
|
|
(8,436,000 |
) |
|
$ |
(0.45 |
) |
Adjusted net income |
$ |
12,426,000 |
|
|
$ |
0.64 |
|
|
$ |
11,790,000 |
|
|
$ |
0.62 |
|
|
(a) Tax effect at 39% of the income before income tax expense
(reflecting the adjustments) |
|
|
|
|
|
Reconciliation of Non-GAAP Financial
Measures |
Exhibit
4 |
|
|
|
|
|
Six Months Ended September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
$ |
|
Per Diluted
Share |
|
$ |
|
Per Diluted
Share |
GAAP net income |
$ |
16,651,000 |
|
|
$ |
0.86 |
|
|
$ |
518,000 |
|
|
$ |
0.03 |
|
Adjustments: |
|
|
|
|
|
|
|
|
Net
sales |
|
|
|
|
|
|
|
|
Initial return and stock adjustment
accruals related to new business |
|
3,168,000 |
|
|
$ |
0.16 |
|
|
|
- |
|
|
$ |
- |
|
|
Customer allowances related to new
business |
|
8,789,000 |
|
|
$ |
0.45 |
|
|
|
10,863,000 |
|
|
$ |
0.58 |
|
|
Cost of goods sold |
|
|
|
|
|
|
|
New product line start-up
costs |
|
140,000 |
|
|
$ |
0.01 |
|
|
|
- |
|
|
$ |
- |
|
|
Lower of cost or market revaluation
- cores on customers' shelves and inventory step-up
amortization |
|
2,193,000 |
|
|
$ |
0.11 |
|
|
|
326,000 |
|
|
$ |
0.02 |
|
|
Cost of customer allowances and
stock adjustment accruals related to new business |
|
(568,000 |
) |
|
$ |
(0.03 |
) |
|
|
(809,000 |
) |
|
$ |
(0.04 |
) |
|
Operating expenses |
|
|
|
|
|
|
|
Legal, severance, acquisition,
financing, transition and other costs |
|
615,000 |
|
|
$ |
0.03 |
|
|
|
4,253,000 |
|
|
$ |
0.23 |
|
|
Accrual made in connection with the
settlement of litigation, net of insurance recoveries, related to
discontinued subsidiaries |
|
- |
|
|
$ |
- |
|
|
|
9,250,000 |
|
|
$ |
0.49 |
|
|
Share-based compensation
expenses |
|
1,737,000 |
|
|
$ |
0.09 |
|
|
|
1,033,000 |
|
|
$ |
0.05 |
|
|
Mark-to-market losses (gains) |
|
(3,595,000 |
) |
|
$ |
(0.19 |
) |
|
|
2,111,000 |
|
|
$ |
0.11 |
|
|
Interest |
|
|
|
|
|
|
|
|
Write-off of prior deferred loan
fees |
|
- |
|
|
$ |
- |
|
|
|
5,108,000 |
|
|
$ |
0.27 |
|
|
Tax
effected at 39% tax rate (a) |
|
(6,614,000 |
) |
|
$ |
(0.34 |
) |
|
|
(12,509,000 |
) |
|
$ |
(0.66 |
) |
Adjusted net income |
$ |
22,516,000 |
|
|
$ |
1.16 |
|
|
$ |
20,144,000 |
|
|
$ |
1.07 |
|
|
|
|
|
|
|
|
|
|
(a) Tax effect at 39% of the income before income tax expense
(reflecting the adjustments) |
|
|
|
|
|
Reconciliation of Non-GAAP Financial
Measures |
Exhibit
5 |
|
|
|
|
|
Three Months Ended
September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
$ |
|
Gross
Margin |
|
$ |
|
Gross
Margin |
GAAP gross profit |
$ |
30,658,000 |
|
|
|
28.2 |
% |
|
$ |
21,820,000 |
|
|
|
23.8 |
% |
Adjustments: |
|
|
|
|
|
|
|
|
Net sales |
|
|
|
|
|
|
|
|
Initial return and stock adjustment
accruals related to new business |
|
1,315,000 |
|
|
|
|
|
- |
|
|
|
|
Customer allowances related to new
business |
|
2,232,000 |
|
|
|
|
|
10,075,000 |
|
|
|
|
Cost of goods sold |
|
|
|
|
|
|
|
New product line start-up
costs |
|
16,000 |
|
|
|
|
|
- |
|
|
|
|
Lower of cost or market revaluation
- cores on customers' shelves and inventory step-up
amortization |
|
475,000 |
|
|
|
|
|
326,000 |
|
|
|
|
Cost of customer allowances and
stock adjustment accruals related to new business |
|
(213,000 |
) |
|
|
|
|
(809,000 |
) |
|
|
|
Total
adjustments |
|
3,825,000 |
|
|
|
2.5 |
% |
|
|
9,592,000 |
|
|
|
7.1 |
% |
Adjusted gross profit |
$ |
34,483,000 |
|
|
|
30.7 |
% |
|
$ |
31,412,000 |
|
|
|
30.9 |
% |
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Financial
Measures |
Exhibit
6 |
|
|
|
|
|
Six Months Ended
September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
$ |
|
Gross
Margin |
|
$ |
|
Gross
Margin |
GAAP gross profit |
$ |
51,049,000 |
|
|
|
26.3 |
% |
|
$ |
47,811,000 |
|
|
|
26.9 |
% |
Adjustments: |
|
|
|
|
|
|
|
|
Net sales |
|
|
|
|
|
|
|
|
Initial return and stock adjustment
accruals related to new business |
|
3,168,000 |
|
|
|
|
|
- |
|
|
|
|
Customer allowances related to new
business |
|
8,789,000 |
|
|
|
|
|
10,863,000 |
|
|
|
|
Cost of goods sold |
|
|
|
|
|
|
|
New product line start-up
costs |
|
140,000 |
|
|
|
|
|
- |
|
|
|
|
Lower of cost or market revaluation
- cores on customers' shelves and inventory step-up
amortization |
|
2,193,000 |
|
|
|
|
|
326,000 |
|
|
|
|
Cost of customer allowances and
stock adjustment accruals related to new business |
|
(568,000 |
) |
|
|
|
|
(809,000 |
) |
|
|
|
Total
adjustments |
|
13,722,000 |
|
|
|
5.1 |
% |
|
|
10,380,000 |
|
|
|
4.0 |
% |
Adjusted gross profit |
$ |
64,771,000 |
|
|
|
31.4 |
% |
|
$ |
58,191,000 |
|
|
|
30.9 |
% |
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Financial Measures |
|
|
Exhibit 7 |
|
|
|
|
|
|
Three Months Ended September 30, |
|
Six Months Ended September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
GAAP net income (loss) |
$ |
9,143,000 |
|
|
$ |
(1,392,000 |
) |
|
$ |
16,651,000 |
|
|
$ |
518,000 |
|
Interest expense,
net |
|
3,189,000 |
|
|
|
2,613,000 |
|
|
|
6,008,000 |
|
|
|
11,050,000 |
|
Income tax expense
(benefit) |
|
4,845,000 |
|
|
|
(898,000 |
) |
|
|
7,781,000 |
|
|
|
370,000 |
|
Depreciation and
amortization |
|
910,000 |
|
|
|
740,000 |
|
|
|
1,770,000 |
|
|
|
1,431,000 |
|
EBITDA |
$ |
18,087,000 |
|
|
$ |
1,063,000 |
|
|
$ |
32,210,000 |
|
|
$ |
13,369,000 |
|
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
Net sales |
|
|
|
|
|
|
|
|
Initial return and stock adjustment
accruals related to new business |
|
1,315,000 |
|
|
|
- |
|
|
|
3,168,000 |
|
|
|
- |
|
|
Customer allowances related to new
business |
|
2,232,000 |
|
|
|
10,075,000 |
|
|
|
8,789,000 |
|
|
|
10,863,000 |
|
|
Cost of goods sold |
|
|
|
|
- |
|
|
|
|
New product line start-up
costs |
|
16,000 |
|
|
|
- |
|
|
|
140,000 |
|
|
|
- |
|
|
Lower of cost or market revaluation
- cores on customers' shelves and inventory step-up
amortization |
|
475,000 |
|
|
|
326,000 |
|
|
|
2,193,000 |
|
|
|
326,000 |
|
|
Cost of customer allowances and
stock adjustment accruals related to new business |
|
(213,000 |
) |
|
|
(809,000 |
) |
|
|
(568,000 |
) |
|
|
(809,000 |
) |
|
Operating expenses |
|
|
|
|
- |
|
|
|
|
Legal, severance, acquisition,
financing, transition and other costs |
|
219,000 |
|
|
|
1,112,000 |
|
|
|
615,000 |
|
|
|
4,253,000 |
|
|
Accrual made in connection with the
settlement of litigation, net of insurance recoveries, related to
discontinued subsidiaries |
|
- |
|
|
|
9,250,000 |
|
|
|
- |
|
|
|
9,250,000 |
|
|
Share-based compensation
expenses |
|
1,008,000 |
|
|
|
517,000 |
|
|
|
1,737,000 |
|
|
|
1,033,000 |
|
|
Mark-to-market losses (gains) |
|
1,331,000 |
|
|
|
1,147,000 |
|
|
|
(3,595,000 |
) |
|
|
2,111,000 |
|
Adjusted EBITDA |
$ |
24,470,000 |
|
|
$ |
22,681,000 |
|
|
$ |
44,689,000 |
|
|
$ |
40,396,000 |
|
|
|
|
|
|
|
|
|
|
CONTACT:
Gary S. Maier
(310) 471-1288
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