Breeze-Eastern Corporation (NYSE Amex: BZC) today reported
its Fiscal 2012 Second Quarter financial results.
- Net sales: $17.9 million, a new record
for second quarter sales, up 18% over $15.1 million for the Fiscal
2011 second quarter.
- Net income: $1.1 million, or $0.12 per
diluted share, up 73% over the Fiscal 2011 second quarter.
- Adjusted EBITDA, as described under
“Non-GAAP Financial Measures” in this press release: $2.4 million,
versus $1.9 million in the Fiscal 2011 second quarter.
- Total debt: $10.7 million, $4.9 million
lower than a year ago.
- Cash: $10.6 million, versus $4.9
million a year ago.
- Bookings: $15.6 million, versus $18.4
million in the Fiscal 2011 second quarter. The book-to-bill ratio
for the Fiscal 2012 second quarter was 0.9.
For the Fiscal 2012 first six months, the financial results
follow.
- Net sales: $36.1 million, a new record
for first six months sales, up 14% over $31.6 million for the
Fiscal 2011 first six months.
- Net income: $1.7 million, or $0.18 per
diluted share, up 39% from $1.2 million, or $0.13 per diluted
share, for the first six months of Fiscal 2011.
- Adjusted EBITDA, as described under
“Non-GAAP Financial Measures” in this press release: $4.0 million,
versus $3.9 million in the Fiscal 2011 first six months.
- Bookings: $29.2 million, versus $38.1
million in the Fiscal 2011 first six months. The book-to-bill ratio
for the Fiscal 2012 first six months was 0.8.
Mike Harlan, President and Chief Executive Officer, said, "We
continued to achieve strong sales with our third consecutive
quarter of record sales. Our cash flow also continues to be strong
and our net debt at the end of the quarter was down to only
$51,000. We have generated this cash while continuing to invest in
product development. We completed development of the new Cargo
Winch for the C-27J JCA aircraft for Alenia/L-3 and the U.S. Air
Force during our second quarter and expect to make production
shipments later this year. We also delivered a prototype weapons
handling system for the Predator-C program. We have been
strategically increasing inventory levels in ways that we expect
will improve customer service and satisfaction. Despite this
investment in inventory, our balance sheet has ample liquidity with
a very strong cash position and we remain well clear of our debt
covenants."
The Company’s earnings conference call is at 10:00 a.m. EDT on
Thursday, October 27, 2011 with the following numbers: (866)
831-5605 or (617) 213-8851 and passcode 51257161.
Breeze-Eastern Corporation (http://www.breeze-eastern.com) is
the world’s leading designer and manufacturer of high performance
lifting and pulling devices for military and civilian aircraft,
including rescue hoists, winches and cargo hooks, and
weapons-lifting systems. The Company employs approximately 165
people at its facilities in Whippany, New Jersey.
Non–GAAP Financial
Measures
In addition to disclosing financial results that are determined
in accordance with Generally Accepted Accounting Principles
(“GAAP”), the Company also discloses Adjusted EBITDA (earnings
before interest, taxes, depreciation and amortization, other
income/expense, loss on debt extinguishment, and relocation
expense). The Company presents Adjusted EBITDA because it considers
it an important supplemental measure of performance. Measures
similar to Adjusted EBITDA are widely used by the Company and by
others in the Company's industry to evaluate performance and
valuation. The Company believes Adjusted EBITDA facilitates
operating performance comparisons from period to period and company
to company by backing out potential differences caused by
variations in capital structure (affecting relative interest
expense), tax positions (such as the impact on periods or companies
of changes in effective tax rates or net operating losses) and the
age and book depreciation of facilities and equipment (affecting
relative depreciation expense). The Company also presents Adjusted
EBITDA because it believes it is frequently used by investors and
other interested parties as a basis for evaluating performance.
Adjusted EBITDA has limitations as an analytical tool, and
should not be considered in isolation or as a substitute for
analysis of the Company's results as reported under GAAP. Some of
the limitations of Adjusted EBITDA are that (i) it does not reflect
the Company's cash expenditures for capital assets, (ii) it does
not reflect the significant interest expense or cash requirements
necessary to service interest or principal payments on the
Company's debt, and (iii) it does not reflect changes in, or cash
requirements for, the Company's working capital. Furthermore, other
companies in the aerospace and defense industry may calculate these
measures differently than the manner presented above. Accordingly,
the Company focuses primarily on its GAAP results and uses Adjusted
EBITDA only supplementally. A reconciliation of Adjusted EBITDA to
net income, the most directly comparable GAAP measure, for the
three and six months ended September 30, 2011 is shown in the
tables below.
INFORMATION ABOUT FORWARD-LOOKING
STATEMENTS
This news release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, regarding our future operating performance, financial
results, events, trends and plans. All statements in this news
release other than statements of historical facts are
forward-looking statements. Forward-looking statements involve
numerous risks and uncertainties. We have attempted to identify any
forward-looking statements by using words such as “anticipates,”
“believes,” “could,” “expects,” “intends,” “may,” “should” and
other similar expressions. Although we believe that the
expectations reflected in all of our forward-looking statements are
reasonable, we can give no assurance that such expectations will
prove to be correct. Such statements are not guarantees of future
performance or events and are subject to known and unknown risks
and uncertainties that could cause our actual results, events or
financial positions to differ materially from those included within
the forward-looking statements. Such factors include, but are not
limited to competition from other companies; changes in applicable
laws, rules, and regulations affecting the Company in the locations
in which it conducts its business; interest rate trends; a decrease
in the United States government defense spending, changes in
spending allocation or the termination, postponement, or failure to
fund one or more significant contracts by the United States
government or other customers; changes in our sales strategy and
product development plans; changes in the marketplace; developments
in environmental proceedings that we are involved in; continued
services of our executive management team; status of labor
relations; competitive pricing pressures; market acceptance of our
products under development; delays in the development of products;
determination by us to dispose of or acquire additional assets;
general industry and economic conditions; events impacting the U.S.
and world financial markets and economies; and those specific risks
disclosed in our Annual Report on Form 10-K for the fiscal year
ended March 31, 2011, and other filings with the Securities and
Exchange Commission. We undertake no obligation to update publicly
any forward-looking statements, whether as a result of new
information or future events.
BREEZE-EASTERN CORPORATION
STATEMENTS OF CONSOLIDATED OPERATIONS (In Thousands of
Dollars Except Share Data)
Three Months Ended
Six Months Ended
9/30/11 9/30/10
9/30/11 9/30/10 Net sales $
17,880 $ 15,106 $ 36,128 $ 31,646 Cost of sales 9,921
8,930 20,785 19,337 Gross
profit 7,959 6,176 15,343 12,309 Selling, general, and
administrative expenses 3,851 3,517 7,755 6,591 Engineering expense
2,063 1,299 4,348 2,855 Relocation expense - -
- 211 Operating income 2,045
1,360 3,240 2,652 Interest expense 102 170 236 383 Other
expense-net 20 81 50
145 Income before income taxes 1,923 1,109 2,954
2,124 Provision for income taxes 808
466 1,241 892 Net income $ 1,115
$ 643 $ 1,713 $ 1,232 Basic
earnings per share: $ 0.12 $ 0.07 $ 0.18
$ 0.13 Diluted earnings per share: $ 0.12 $ 0.07
$ 0.18 $ 0.13 Weighted average
basic shares 9,470,000 9,400,000 9,457,000 9,398,000 Weighted
average diluted shares 9,628,000 9,412,000 9,596,000 9,412,000
BALANCE SHEET INFORMATION
(In Thousands of Dollars) 9/30/11
3/31/11 Current assets $ 49,069 $ 47,756 Fixed
assets – net 8,195 8,351 Other assets 22,097
22,041 Total assets $ 79,361 $ 78,148
Current portion of long-term debt
and short term borrowings
$ 821 $ - Other current liabilities 16,688
15,380 Total current liabilities 17,509 15,380 Long-term
debt 9,858 11,500 Other non-current liabilities 16,292 17,835
Stockholders' equity 35,702 33,433
Total liabilities and stockholders' equity $ 79,361 $
78,148
Reconciliation of Reported
Income to Adjusted EBITDA (In Thousands of Dollars)
Three Months Ended Six Months Ended 9/30/11
9/30/10 9/30/11 9/30/10
Net sales $ 17,880 $ 15,106 $ 36,128 $ 31,646 Cost of sales
9,921 8,930 20,785
19,337 Gross profit 7,959 6,176 15,343 12,309 Selling,
general and administrative expenses 3,851 3,517 7,755 6,591
Engineering expense 2,063 1,299 4,348 2,855 Relocation expense
-
-
- 211 Operating income 2,045
1,360 3,240 2,652 Add back: Depreciation and amortization
391 528 767 998 Relocation expense - -
- 211 Adjusted EBITDA $ 2,436 $
1,888 $ 4,007 $ 3,861
Net income $ 1,115 $ 643 $ 1,713 $ 1,232 Provision for income taxes
808 466 1,241 892 Depreciation and amortization 391 528 767 998
Relocation expense - - - 211 Interest expense 102 170 236 383 Other
expense-net 20 81 50
145 Adjusted EBITDA $ 2,436 $ 1,888
$ 4,007 $ 3,861
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