MILWAUKEE, Jan. 24, 2018 /PRNewswire/ -- Briggs &
Stratton Corporation (NYSE: BGG) today announced financial results
for its second fiscal quarter ended December
31, 2017.
- Fiscal second quarter net sales were $446 million, an increase of $18 million, or 4.2%, from $428 million for the prior year from continued
favorable momentum in sales of engines and products designed for
commercial markets.
- Quarterly gross profit margin of 20.8% (GAAP) and adjusted
gross profit margin of 21.1% decreased from a gross profit margin
of 22.3% last year primarily due to sales mix and lower production
volumes as anticipated.
- Second quarter net loss of $16.3
million, or $0.39 per share
(GAAP), included a $24.9 million
one-time charge as a result of the implementation of the Tax Cuts
and Jobs Act of 2017 ("Tax Reform") as well as business
optimization charges. Excluding these items, adjusted net income
was $10.7 million, or $0.25 per diluted share.
- The company's estimated effective tax rate for fiscal 2018 is
expected to be in a range of 29% to 31%, excluding business
optimization costs and the one-time charge from implementing Tax
Reform.
- The company is increasing its fiscal 2018 earnings outlook to
$1.45 to $1.62 per diluted share, before business
optimization costs and the one-time charge from implementing Tax
Reform, from previous guidance of $1.41 to $1.58 per
diluted share due to the reduction in the planned effective tax
rate.
"At the halfway point in our fiscal year, I am pleased to report
that we are solidly on track to meeting our annual and long-range
goals," said Todd J. Teske,
Chairman, President and Chief Executive Officer. "Highlights from
our second quarter results included growth of our commercial
offerings as well as a modest contribution from follow-on generator
sales due to the hurricanes this past fall. We also made nice
strides in advancing our business optimization program, and we
remain on schedule with this important initiative to support growth
and long-term profitability improvement." Teske continued, "Looking
forward to the upcoming lawn and garden season, our engine
placement is set and it is consistent with last season as we had
anticipated. We continue to introduce new, innovative residential
products and engines that provide substantially better performance
and benefits for home owners. We are also encouraged by
continued positive growth trends for new and existing single-family
homes. Accelerating our momentum in growing sales of our
commercial offerings remains a key focus for us, and we expect that
our new products and engines this year will result in further
success. The new offerings are designed to improve the productivity
of people who use our equipment to earn a living."
Tax Reform
- As a result of the Tax Cuts and Jobs Act of 2017, the company
recognized a one-time charge of $24.9
million in the second quarter from the estimated impact of
the inclusion of foreign earnings and revaluation of deferred tax
assets and liabilities. Excluding this charge as well as the costs
of the company's business optimization program, the company expects
the reduction in the corporate tax rate will result in an effective
tax rate of approximately 29% to 31% (previously 31% to 33%) for
fiscal 2018. Given the mid-year change in the corporate tax rate,
the company's fiscal 2018 effective tax rate is comprised of a
blend of the pre and post-tax reform tax rates. Beginning in fiscal
2019, the company's effective tax rate is expected to decrease to a
range of approximately 26% to 28%.
Outlook:
Updated fiscal 2018 guidance:
- Net sales are expected to be in a range of $1.91 billion to $1.96
billion, up from previous guidance of $1.90 billion to $1.95
billion, due to follow-on generator sales to date through
the end of the second quarter.
- Net income is expected to be in a range of $62 million to $70
million (previously $60
million to $68 million), or
$1.45 to $1.62 per diluted share (previously $1.41 to $1.58 per
diluted share), due to the reduction in the planned effective tax
rate. This outlook is prior to the benefit of share repurchases and
excludes the costs of the business optimization program and the
one-time implementation charge related to Tax Reform.
- Operating margins are expected to remain unchanged from
previous guidance of approximately 5.8% to 6.0%, prior to the
impact of costs related to the company's business optimization
program. Management expects the modest contribution from follow-on
generator sales in the second quarter to be offset by incremental
promotional investment in the upcoming quarter to further promote
the company's innovative products to new and existing
homeowners.
Conference Call Information:
The company will host a conference call tomorrow at 10:00 AM (ET) to review the second quarter
financial results. A live webcast of the conference call will be
available on the company's corporate website:
http://investors.basco.com.
Also available is a dial-in number to access the call real-time
at (877) 233-9136 and enter Conference ID 3969087. A replay will be
offered beginning approximately two hours after the call ends and
will be available for one week. Dial (855) 859-2056 to access the
replay.
Non-GAAP Financial Measures:
This release refers to non-GAAP financial measures including
"adjusted gross profit", "adjusted engineering, selling, general,
and administrative expenses", "adjusted segment income (loss)",
"adjusted net income (loss)", and "adjusted diluted earnings (loss)
per share." Refer to the accompanying financial schedules for
supplemental financial data and corresponding reconciliations of
these non-GAAP financial measures to certain GAAP financial
measures.
Safe Harbor Statement:
This release contains certain forward-looking statements that
involve risks and uncertainties that could cause actual results to
differ materially from those projected in the forward-looking
statements. The words "anticipate", "believe", "estimate",
"expect", "forecast", "intend", "plan", "project", and similar
expressions are intended to identify forward-looking statements.
The forward-looking statements are based on the company's current
views and assumptions and involve risks and uncertainties that
include, among other things, the ability to successfully forecast
demand for its products; changes in interest rates and foreign
exchange rates; the effects of weather on the purchasing patterns
of consumers and original equipment manufacturers (OEMs); actions
of engine manufacturers and OEMs with whom the company competes;
changes in laws and regulations, including U.S. tax reform, changes
in tax rates, laws and regulations as well as related guidance;
changes in customer and OEM demand; changes in prices of raw
materials and parts that the company purchases; changes in domestic
and foreign economic conditions (including effects from the U.K.'s
decision to exit the European Union); the ability to bring new
productive capacity on line efficiently and with good quality;
outcomes of legal proceedings and claims; the ability to realize
anticipated savings from restructuring actions; and other factors
disclosed from time to time in the company's SEC filings or
otherwise, including the factors discussed in Item 1A, Risk
Factors, of the company's Annual Report on Form 10-K and in its
periodic reports on Form 10-Q. The company undertakes no obligation
to update forward-looking statements made in this release to
reflect events or circumstances after the date of this
release.
About Briggs & Stratton Corporation:
Briggs & Stratton Corporation (NYSE: BGG), headquartered in
Milwaukee, Wisconsin, is focused
on providing power to get work done and make people's lives better.
Briggs & Stratton is the world's largest producer of gasoline
engines for outdoor power equipment, and is a leading designer,
manufacturer and marketer of power generation, pressure washer,
lawn and garden, turf care and job site products through its Briggs
& Stratton®, Simplicity®, Snapper®, Ferris®, Vanguard™,
Allmand®, Billy Goat®, Murray®, Branco®, and Victa® brands. Briggs
& Stratton products are designed, manufactured, marketed and
serviced in over 100 countries on six continents. For additional
information, please visit www.basco.com and
www.briggsandstratton.com.
BRIGGS &
STRATTON CORPORATION AND SUBSIDIARIES
|
Consolidated
Statements of Operations for the Periods Ended
December
|
(In Thousands,
except per share data)
|
|
|
Three Months
Ended December
|
|
Six Months
Ended December
|
|
FY2018
|
|
FY2017
|
|
FY2018
|
|
FY2017
|
NET SALES
|
$446,436
|
|
$428,236
|
|
$775,531
|
|
$715,034
|
COST OF GOODS
SOLD
|
353,570
|
|
332,830
|
|
616,400
|
|
567,106
|
Gross
Profit
|
92,866
|
|
95,406
|
|
159,131
|
|
147,928
|
|
|
|
|
|
|
|
|
ENGINEERING, SELLING,
GENERAL AND ADMINISTRATIVE
EXPENSES
|
77,891
|
|
73,032
|
|
164,605
|
|
145,095
|
EQUITY IN EARNINGS OF
UNCONSOLIDATED AFFILIATES
|
2,113
|
|
3,011
|
|
5,726
|
|
6,239
|
Income from
Operations
|
17,088
|
|
25,385
|
|
252
|
|
9,072
|
|
|
|
|
|
|
|
|
INTEREST
EXPENSE
|
(5,593)
|
|
(5,133)
|
|
(10,550)
|
|
(9,638)
|
OTHER
INCOME
|
685
|
|
381
|
|
1,403
|
|
836
|
Income (Loss) before
Income Taxes
|
12,180
|
|
20,633
|
|
(8,895)
|
|
270
|
|
|
|
|
|
|
|
|
PROVISION (CREDIT)
FOR INCOME TAXES
|
28,524
|
|
5,382
|
|
22,488
|
|
(833)
|
Net Income
(Loss)
|
$
(16,344)
|
|
$
15,251
|
|
$
(31,383)
|
|
$
1,103
|
|
|
|
|
|
|
|
|
EARNINGS (LOSS) PER
SHARE
|
|
|
|
|
|
|
|
Basic
|
$
(0.39)
|
|
$
0.35
|
|
$
(0.75)
|
|
$
0.02
|
Diluted
|
(0.39)
|
|
0.35
|
|
(0.75)
|
|
0.02
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE
SHARES OUTSTANDING
|
|
|
|
|
|
|
|
Basic
|
42,154
|
|
42,081
|
|
42,130
|
|
42,287
|
Diluted
|
42,154
|
|
42,142
|
|
42,130
|
|
42,337
|
Supplemental
International Sales Information
|
(In
Thousands)
|
|
|
Three Months
Ended December
|
|
Six Months
Ended December
|
|
FY2018
|
|
FY2017
|
|
FY2018
|
|
FY2017
|
International sales
based on product shipment destination
|
$157,248
|
|
$158,727
|
|
$271,885
|
|
$268,614
|
BRIGGS &
STRATTON CORPORATION AND SUBSIDIARIES
|
Consolidated
Balance Sheets as of the End of December
|
(In
Thousands)
|
|
CURRENT
ASSETS:
|
FY2018
|
|
FY2017
|
Cash and Cash
Equivalents
|
$
66,366
|
|
$
47,327
|
Accounts Receivable,
Net
|
201,253
|
|
222,768
|
Inventories
|
501,531
|
|
485,851
|
Prepaid Expenses and
Other Current Assets
|
37,901
|
|
36,010
|
Total Current
Assets
|
807,051
|
|
791,956
|
|
|
|
|
OTHER
ASSETS:
|
|
|
|
Goodwill
|
164,312
|
|
161,287
|
Investments
|
47,626
|
|
48,298
|
Other Intangible
Assets, Net
|
98,895
|
|
102,324
|
Deferred Income Tax
Asset
|
43,882
|
|
88,111
|
Other Long-Term
Assets, Net
|
19,870
|
|
20,171
|
Total Other
Assets
|
374,585
|
|
420,191
|
|
|
|
|
|
|
|
|
PLANT AND
EQUIPMENT:
|
|
|
|
At Cost
|
1,140,232
|
|
1,077,452
|
Less - Accumulated
Depreciation
|
754,654
|
|
746,289
|
Plant and Equipment,
Net
|
385,578
|
|
331,163
|
|
$
1,567,214
|
|
$
1,543,310
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
Accounts
Payable
|
$
208,307
|
|
$
186,291
|
Short-Term
Debt
|
128,647
|
|
132,100
|
Accrued
Liabilities
|
142,785
|
|
127,411
|
Total Current
Liabilities
|
479,739
|
|
445,802
|
|
|
|
|
OTHER
LIABILITIES:
|
|
|
|
Accrued Pension
Cost
|
232,769
|
|
301,551
|
Accrued Employee
Benefits
|
21,664
|
|
22,819
|
Accrued
Postretirement Health Care Obligation
|
31,361
|
|
33,658
|
Other Long-Term
Liabilities
|
51,464
|
|
43,797
|
Long-Term
Debt
|
222,008
|
|
221,570
|
Total Other
Liabilities
|
559,266
|
|
623,395
|
|
|
|
|
SHAREHOLDERS'
INVESTMENT:
|
|
|
|
Common
Stock
|
579
|
|
579
|
Additional Paid-In
Capital
|
73,635
|
|
68,144
|
Retained
Earnings
|
1,063,501
|
|
1,063,500
|
Accumulated Other
Comprehensive Loss
|
(290,254)
|
|
(336,952)
|
Treasury Stock, at
Cost
|
(319,252)
|
|
(321,158)
|
Total Shareholders'
Investment
|
528,209
|
|
474,113
|
|
$
1,567,214
|
|
$
1,543,310
|
BRIGGS &
STRATTON CORPORATION AND SUBSIDIARIES
|
Consolidated
Statements of Cash Flows
|
(In
Thousands)
|
|
|
Six Months Ended
December
|
|
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
FY2018
|
|
FY2017
|
Net Income
(Loss)
|
$
(31,383)
|
|
$
1,103
|
Adjustments to
Reconcile Net Income (Loss) to Net Cash Used in Operating
Activities:
|
|
|
|
Depreciation and
Amortization
|
28,524
|
|
28,156
|
Stock Compensation
Expense
|
3,869
|
|
2,826
|
Loss on Disposition
of Plant and Equipment
|
1,553
|
|
331
|
Provision for
Deferred Income Taxes
|
18,427
|
|
4,315
|
Equity in Earnings of
Unconsolidated Affiliates
|
(6,948)
|
|
(6,239)
|
Dividends Received
from Unconsolidated Affiliates
|
9,810
|
|
8,186
|
Changes in Operating
Assets and Liabilities:
|
|
|
|
Accounts
Receivable
|
29,900
|
|
(36,077)
|
Inventories
|
(126,075)
|
|
(99,787)
|
Other Current
Assets
|
(3,402)
|
|
1,203
|
Accounts Payable,
Accrued Liabilities and Income Taxes
|
16,808
|
|
(23,350)
|
Other, Net
|
(5,944)
|
|
(7,240)
|
Net Cash
Used in Operating Activities
|
(64,861)
|
|
(126,573)
|
|
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
Capital
Expenditures
|
(45,597)
|
|
(31,163)
|
Proceeds Received on
Disposition of Plant and Equipment
|
686
|
|
1,009
|
Cash Paid for
Acquisitions, Net of Cash Acquired
|
(1,800)
|
|
-
|
Proceeds on Sale of
Investment in Marketable Securities
|
-
|
|
3,343
|
Increase to
Restricted Cash
|
(12,704)
|
|
-
|
Net Cash
Used in Investing Activities
|
(59,415)
|
|
(26,811)
|
|
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
Net Borrowings on
Revolver
|
128,648
|
|
132,100
|
Long Term Note
Payable
|
7,685
|
|
-
|
Debt Issuance
Costs
|
(1,154)
|
|
-
|
Treasury Stock
Purchases
|
(3,128)
|
|
(15,153)
|
Payment of
Acquisition Contingent Liability
|
-
|
|
(813)
|
Stock Option Exercise
Proceeds and Tax Benefits
|
2,939
|
|
4,243
|
Payments Related to
Shares Withheld for Taxes for Stock Compensation
|
(1,147)
|
|
(1,739)
|
Cash Dividends
Paid
|
(5,998)
|
|
(6,039)
|
Net Cash
Provided by Financing Activities
|
127,845
|
|
112,599
|
|
|
|
|
EFFECT OF EXCHANGE
RATE CHANGES
|
1,090
|
|
(1,727)
|
NET DECREASE IN CASH
AND CASH EQUIVALENTS
|
4,659
|
|
(42,512)
|
CASH AND CASH
EQUIVALENTS, Beginning
|
61,707
|
|
89,839
|
CASH AND CASH
EQUIVALENTS, Ending
|
$
66,366
|
|
$
47,327
|
Liquidity and Capital Resources:
Net debt at December 31, 2017 was
$285.4 million (total Long-Term Debt
and Short-Term Debt, excluding related debt issuance costs, of
$351.8 million less $66.4 million of cash), compared with
$307.9 million (total Long-Term Debt
and Short-Term Debt, excluding debt issuance costs, of $355.2 million less $47.3
million of cash) at January 2,
2017.
Cash flows used in operating activities for the first six months
of fiscal 2018 were $64.9 million,
compared to $126.6 million for the
first six months of fiscal 2017. The decrease in cash used in
operating activities was primarily related to changes in working
capital, including greater collections of accounts receivable due
to timing of sales and customer payments, as well as higher
accounts payable due to timing.
During the first six months of fiscal 2018, the company
repurchased approximately 141,000 shares of its common stock
(including approximately 42,000 in the second quarter) on the open
market at an average price of $22.16
per share. As of December 31, 2017,
there was remaining authorization to repurchase up to approximately
$27 million of common stock with an
expiration date of June 29, 2018.
SUPPLEMENTAL SEGMENT INFORMATION
Engines
Segment:
|
|
|
Three Months
Ended December
|
|
Six Months
Ended December
|
(In
Thousands)
|
FY2018
|
|
FY2017
|
|
FY2018
|
|
FY2017
|
Net Sales
|
$
243,505
|
|
$ 260,797
|
|
$
406,252
|
|
$ 415,235
|
|
|
|
|
|
|
|
|
Gross Profit as
Reported
|
$
55,429
|
|
$
61,573
|
|
$
86,648
|
|
$
92,559
|
Business
Optimization
|
703
|
|
-
|
|
1,128
|
|
-
|
Adjusted Gross
Profit
|
$
56,132
|
|
$
61,573
|
|
$
87,776
|
|
$
92,559
|
|
|
|
|
|
|
|
|
Gross Profit % as
Reported
|
22.8%
|
|
23.6%
|
|
21.3%
|
|
22.3%
|
Adjusted Gross Profit
%
|
23.1%
|
|
23.6%
|
|
21.6%
|
|
22.3%
|
|
|
|
|
|
|
|
|
Segment Income (Loss)
as Reported
|
$
8,421
|
|
$
17,922
|
|
$
(11,437)
|
|
$
6,269
|
Business
Optimization
|
2,016
|
|
-
|
|
4,347
|
|
-
|
Adjusted Segment
Income (Loss)
|
$
10,437
|
|
$
17,922
|
|
$
(7,090)
|
|
$
6,269
|
|
|
|
|
|
|
|
|
Segment Income (Loss)
% as Reported
|
3.5%
|
|
6.9%
|
|
-2.8%
|
|
1.5%
|
Adjusted Segment
Income (Loss) %
|
4.3%
|
|
6.9%
|
|
-1.7%
|
|
1.5%
|
Second Quarter Highlights
- Engine sales unit volumes decreased by 10%, or approximately
180,000 engines, in the second quarter of fiscal 2018 compared to
the same period last year. The decrease was primarily due to an
acceleration of international sales into the first quarter of
fiscal 2018, as well as management's anticipation that domestic
customers will produce closer to the lawn and garden season this
year. Sales of service parts to the company's service distribution
venture were also lower this year due to a planned seasonal
inventory reduction initiative. Partially offsetting the sales
decline were increased sales of commercial engines.
- Gross profit percentage decreased due to approximately 5% lower
manufacturing volume and unfavorable sales mix, which includes
lower service parts sales. Higher material costs were offset by
modest pricing increases.
- ESG&A increased by $2.5
million (GAAP) and $2.4
million (adjusted) from last year due to higher employee
compensation costs and the investment in the upgrade to the
company's ERP system.
Products
Segment:
|
|
|
Three Months
Ended December
|
|
Six Months
Ended December
|
(In
Thousands)
|
FY2018
|
|
FY2017
|
|
FY2018
|
|
FY2017
|
Net Sales
|
$
222,080
|
|
$ 190,701
|
|
$
408,676
|
|
$ 341,497
|
|
|
|
|
|
|
|
|
Gross Profit as
Reported
|
$
37,090
|
|
$
33,178
|
|
$
72,797
|
|
$
56,129
|
Business
Optimization
|
754
|
|
-
|
|
1,522
|
|
-
|
Adjusted Gross
Profit
|
$
37,844
|
|
$
33,178
|
|
$
74,319
|
|
$
56,129
|
|
|
|
|
|
|
|
|
Gross Profit % as
Reported
|
16.7%
|
|
17.4%
|
|
17.8%
|
|
16.4%
|
Adjusted Gross Profit
%
|
17.0%
|
|
17.4%
|
|
18.2%
|
|
16.4%
|
|
|
|
|
|
|
|
|
Segment Income as
Reported
|
$
8,320
|
|
$
6,808
|
|
$
12,003
|
|
$
3,563
|
Business
Optimization
|
1,044
|
|
-
|
|
3,950
|
|
-
|
Adjusted Segment
Income
|
$
9,364
|
|
$
6,808
|
|
$
15,953
|
|
$
3,563
|
|
|
|
|
|
|
|
|
Segment Income % as
Reported
|
3.7%
|
|
3.6%
|
|
2.9%
|
|
1.0%
|
Adjusted Segment
Income %
|
4.2%
|
|
3.6%
|
|
3.9%
|
|
1.0%
|
Second Quarter Highlights
- Net sales increased by $31.4
million, or 16.5%, from the same period last year. The
increase was primarily due to higher sales of commercial job site
products, commercial lawn and garden equipment and snow throwers.
Generator sales were slightly lower in the second quarter of fiscal
2018 given the prior year's second quarter net sales included the
impact of Hurricane Matthew.
- Gross profit percentage and adjusted gross profit percentage
decreased by 70 basis points and 40 basis points, respectively,
primarily due to a 4% reduction in manufacturing throughput.
Production of pressure washers and residential riding mowers was
lower in the quarter in order to right size inventory levels, which
were elevated coming out of last season.
- ESG&A increased by $2.4
million (GAAP) and $2.1
million (adjusted) compared to last year due to higher
compensation costs, higher commissions expense on increased sales
volume and higher costs associated with investments to upgrade the
company's ERP system and growing commercial offerings.
Non-GAAP Financial Measures
Briggs & Stratton Corporation prepares its financial
statements using Generally Accepted Accounting Principles (GAAP).
When a company discloses material information containing non-GAAP
financial measures, SEC regulations require that the disclosure
include a presentation of the most directly comparable GAAP measure
and a reconciliation of the GAAP and non-GAAP financial measures.
Management's inclusion of non-GAAP financial measures in this
release is intended to supplement, not replace, the presentation of
the financial results in accordance with GAAP. Briggs &
Stratton Corporation management believes that these non-GAAP
financial measures, when considered together with the GAAP
financial measures, provide information that is useful to investors
in understanding period-over-period operating results separate and
apart from items that may, or could, have a disproportionately
positive or negative impact on results in any particular period.
Management also believes that these non-GAAP financial measures
enhance the ability of investors to analyze the company's business
trends and to understand the company's performance. In addition,
management may utilize non-GAAP financial measures as a guide in
the company's forecasting, budgeting and long-term planning
process. Non-GAAP financial measures should be considered in
addition to, and not as a substitute for, or superior to, financial
measures presented in accordance with GAAP. The following tables
are reconciliations of the non-GAAP financial measures:
BRIGGS &
STRATTON CORPORATION AND SUBSIDIARIES
|
Adjusted Segment
Information for the Three Month Periods Ended
December
|
(In Thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December
|
|
FY2018
Reported
|
|
Adjustments1
|
|
FY2018
Adjusted
|
|
FY2017
Reported
|
|
Adjustments
|
|
FY2017
Adjusted
|
Gross
Profit
|
|
|
|
|
|
|
|
|
|
|
|
Engines
|
$
55,429
|
|
$
703
|
|
$
56,132
|
|
$
61,573
|
|
$
-
|
|
$
61,573
|
Products
|
37,090
|
|
754
|
|
37,844
|
|
33,178
|
|
-
|
|
33,178
|
Inter-Segment
Eliminations
|
347
|
|
-
|
|
347
|
|
655
|
|
-
|
|
655
|
Total
|
$
92,866
|
|
$
1,457
|
|
$
94,323
|
|
$
95,406
|
|
$
-
|
|
$
95,406
|
|
|
|
|
|
|
|
|
|
|
|
|
Engineering, Selling,
General and Administrative Expenses
|
|
|
|
|
|
|
|
|
|
|
|
Engines
|
$
48,167
|
|
$
90
|
|
$
48,077
|
|
$
45,706
|
|
$
-
|
|
$
45,706
|
Products
|
29,724
|
|
290
|
|
29,434
|
|
27,326
|
|
-
|
|
27,326
|
Total
|
$
77,891
|
|
$
380
|
|
$
77,511
|
|
$
73,032
|
|
$
-
|
|
$
73,032
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in Earnings
of
Unconsolidated Affiliates
|
|
|
|
|
|
|
|
|
|
|
|
Engines
|
$
1,159
|
|
$
1,223
|
|
$
2,382
|
|
$
2,055
|
|
$
-
|
|
$
2,055
|
Products
|
954
|
|
-
|
|
954
|
|
956
|
|
-
|
|
956
|
Total
|
$
2,113
|
|
$
1,223
|
|
$
3,336
|
|
$
3,011
|
|
$
-
|
|
$
3,011
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Income
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
Engines
|
$
8,421
|
|
$
2,016
|
|
$
10,437
|
|
$
17,922
|
|
$
-
|
|
$
17,922
|
Products
|
8,320
|
|
1,044
|
|
9,364
|
|
6,808
|
|
-
|
|
6,808
|
Inter-Segment
Eliminations
|
347
|
|
-
|
|
347
|
|
655
|
|
-
|
|
655
|
Total
|
$
17,088
|
|
$
3,060
|
|
$
20,148
|
|
$
25,385
|
|
$
-
|
|
$
25,385
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before Income
Taxes
|
12,180
|
|
3,060
|
|
15,240
|
|
20,633
|
|
-
|
|
20,633
|
Provision for Income
Taxes
|
28,524
|
|
(24,010)
|
|
4,514
|
|
5,382
|
|
-
|
|
5,382
|
Net Income
(Loss)
|
$
(16,344)
|
|
$
27,070
|
|
$
10,726
|
|
$
15,251
|
|
$
-
|
|
$
15,251
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (Loss) Per
Share
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
(0.39)
|
|
$
0.64
|
|
$
0.25
|
|
$
0.35
|
|
$
-
|
|
$
0.35
|
Diluted
|
(0.39)
|
|
0.64
|
|
0.25
|
|
0.35
|
|
-
|
|
0.35
|
|
|
1
|
For the second
quarter of fiscal 2018, business optimization expenses include $0.8
million ($0.5 million after tax) of non-cash charges related
primarily to plant & equipment impairment and accelerated
depreciation, and $2.3 million ($1.6 million after tax) of cash
charges related primarily to employee termination benefits, lease
terminations, professional services and plant rearrangement
activities. Tax expense also includes a $24.9 million charge
associated with the Tax Cuts and Jobs Act of 2017 comprised of
$18.7 million to revalue deferred tax assets and $6.2 million to
record the impact of the inclusion of foreign earnings.
|
BRIGGS &
STRATTON CORPORATION AND SUBSIDIARIES
|
Adjusted Segment
Information for the Six Month Periods Ended December
|
(In Thousands,
except per share data)
|
|
|
Six Months
Ended December
|
|
FY2018
Reported
|
|
Adjustments1
|
|
FY2018
Adjusted
|
|
FY2017
Reported
|
|
Adjustments
|
|
FY2017
Adjusted
|
Gross
Profit
|
|
|
|
|
|
|
|
|
|
|
|
Engines
|
$
86,648
|
|
$
1,128
|
|
$
87,776
|
|
$
92,559
|
|
$
-
|
|
$
92,559
|
Products
|
72,797
|
|
1,522
|
|
74,319
|
|
56,129
|
|
-
|
|
56,129
|
Inter-Segment
Eliminations
|
(314)
|
|
-
|
|
(314)
|
|
(760)
|
|
-
|
|
(760)
|
Total
|
$
159,131
|
|
$
2,650
|
|
$
161,781
|
|
$
147,928
|
|
$
-
|
|
$
147,928
|
|
|
|
|
|
|
|
|
|
|
|
|
Engineering, Selling,
General and Administrative Expenses
|
|
|
|
|
|
|
|
|
|
|
|
Engines
|
$
101,526
|
|
$
1,996
|
|
$
99,530
|
|
$
90,161
|
|
$
-
|
|
$
90,161
|
Products
|
63,079
|
|
2,428
|
|
60,651
|
|
54,934
|
|
-
|
|
54,934
|
Total
|
$
164,605
|
|
$
4,424
|
|
$
160,181
|
|
$
145,095
|
|
$
-
|
|
$
145,095
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in Earnings
of
Unconsolidated Affiliates
|
|
|
|
|
|
|
|
|
|
|
|
Engines
|
$
3,441
|
|
$
1,223
|
|
$
4,664
|
|
$
3,871
|
|
$
-
|
|
$
3,871
|
Products
|
2,285
|
|
-
|
|
2,285
|
|
2,368
|
|
-
|
|
2,368
|
Total
|
$
5,726
|
|
$
1,223
|
|
$
6,949
|
|
$
6,239
|
|
$
-
|
|
$
6,239
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Income
(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
Engines
|
$
(11,437)
|
|
$
4,347
|
|
$
(7,090)
|
|
$
6,269
|
|
$
-
|
|
$
6,269
|
Products
|
12,003
|
|
3,950
|
|
15,953
|
|
3,563
|
|
-
|
|
3,563
|
Inter-Segment
Eliminations
|
(314)
|
|
-
|
|
(314)
|
|
(760)
|
|
-
|
|
(760)
|
Total
|
$
252
|
|
$
8,297
|
|
$
8,549
|
|
$
9,072
|
|
$
-
|
|
$
9,072
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) before
Income Taxes
|
(8,895)
|
|
8,297
|
|
(598)
|
|
270
|
|
-
|
|
270
|
Provision (Credit)
for Income Taxes
|
22,488
|
|
(22,501)
|
|
(13)
|
|
(833)
|
|
-
|
|
(833)
|
Net Income
(Loss)
|
$
(31,383)
|
|
$
30,798
|
|
$
(585)
|
|
$
1,103
|
|
$
-
|
|
$
1,103
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (Loss) Per
Share
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
(0.75)
|
|
$
0.73
|
|
$
(0.02)
|
|
$
0.02
|
|
$
-
|
|
$
0.02
|
Diluted
|
(0.75)
|
|
0.73
|
|
(0.02)
|
|
0.02
|
|
-
|
|
0.02
|
|
|
1
|
For the first six
months of fiscal 2018, business optimization expenses include $3.0
million ($2.1 million after tax) of non-cash charges related
primarily to plant & equipment impairment and accelerated
depreciation, and $5.3 million ($3.7 million after tax) of cash
charges related primarily to employee termination benefits, lease
terminations, professional services and plant rearrangement
activities. Tax expense also includes a $24.9 million charge
associated with the Tax Cuts and Jobs Act of 2017 comprised of
$18.7 million to revalue deferred tax assets and $6.2 million to
record the impact of the inclusion of foreign earnings.
|
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SOURCE Briggs & Stratton Corporation