Breeze-Eastern Corporation (NYSE Amex: BZC) today reported
its Fiscal 2012 Third Quarter financial results.
For the Fiscal 2012 third quarter, the financial results
follow:
- Net sales: $19.6 million, even with the
Fiscal 2011 third quarter
- Net income: $1.1 million, or $0.11 per
diluted share, up 11% from $1.0 million, or $0.10 per diluted
share, for the Fiscal 2011 third quarter
- Adjusted EBITDA (as described under
“Non-GAAP Financial Measures” in this press release): $2.3 million
for both the Fiscal 2012 and Fiscal 2011 third quarters
- Total debt: $10.7 million, $2.5 million
lower than a year ago
- Cash: $7.8 million, versus $3.4 million
a year ago
- Bookings: $14.0 million, versus $15.8
million in the Fiscal 2011 third quarter
For the Fiscal 2012 nine months, the financial results
follow:
- Net sales: $55.7 million, up almost 9%
over $51.3 million for the Fiscal 2011 first nine months
- Net income: $2.8 million, or $0.29 per
diluted share, up 27% from $2.2 million, or $0.23 per diluted
share, for the first nine months of Fiscal 2011
- Adjusted EBITDA: $6.3 million, versus
$6.2 million in the Fiscal 2011 first nine months
- Bookings: $43.2 million, versus $53.9
million in the Fiscal 2011 first nine months
Mike Harlan, C.E.O. and President, said, "Our total sales
continue to be strong as our cumulative sales over the last four
quarters exceeded $80 million for the first time. Third Quarter
bookings and net backlog at the end of the quarter were lower than
last year, as we continue to work to secure several large orders;
when we secure these orders, we expect our backlog to increase
significantly.
“Our total engineering expenses (excluding cost reimbursements
from Airbus) were clearly higher this quarter compared to the same
quarter last year. We recently hired a new VP of Engineering to
provide stronger technical leadership, hire fresh talent and
improve our engineering processes and program management. We expect
that our engineering costs will continue to be relatively high for
the current quarter and into the next Fiscal Year as we continue to
fulfill our commitments to our customers.
Our inventory was about $1 million higher at the end of the
quarter than at the end of the Second Quarter and $2.5 million
higher than the Third Quarter last year, but we expect it to be
lower by the end of the Fourth Quarter. Our overall balance sheet
and cash position is strong. Despite the higher engineering
spending and the growth in inventory, we finished our Third Quarter
with $7.8 million in cash and our net debt (deducting cash from
current and long-term debt) is $2.9 million, $2.2 million lower
than when we began the year," Mr. Harlan concluded.
The Company’s earnings conference call is at 10:00 a.m. EST on
Thursday, February 2, 2012 with the following numbers: (866)
730-5765 or (857) 350-1589 and passcode 87846878.
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 180
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 nine months ended December 31, 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
Nine Months Ended
12/31/11 12/31/10
12/31/11 12/31/10 Net sales
$ 19,599 $ 19,614 $ 55,727 $ 51,260 Cost of sales 11,644
12,339 32,429 31,676
Gross profit
7,955 7,275 23,298 19,584 Selling, general, and
administrative expenses 3,883 3,972 11,638 10,563 Engineering
expense 2,127 1,462 6,475 4,317 Relocation expense -
- - 211 Operating income 1,945 1,841 5,185 4,493
Interest expense 80 167 316 550 Other expense-net 39
31 89 176 Income before income taxes 1,826
1,643 4,780 3,767 Provision for income taxes 767
690 2,008 1,582 Net income $ 1,059 $ 953 $
2,772 $ 2,185 Basic earnings per share: $ 0.11 $ 0.10 $ 0.29
$ 0.23 Diluted earnings per share: $ 0.11 $ 0.10 $ 0.29 $ 0.23
Weighted average basic shares 9,489,000 9,429,000
9,468,000 9,409,000 Weighted average diluted shares 9,598,000
9,464,000 9,597,000 9,430,000
BALANCE SHEET INFORMATION
(In Thousands of Dollars)
12/31/11 3/31/11
Current assets $ 51,309 $ 47,756 Fixed assets – net 7,927 8,351
Other assets 22,100 22,041 Total assets $ 81,336 $
78,148 Current portion of long-term debt
and short term borrowings
$ 1,643 $ - Other current liabilities 17,469 15,380
Total current liabilities 19,112 15,380 Long-term debt 9,036 11,500
Other non-current liabilities 16,219 17,835 Stockholders' equity
36,969 33,433 Total liabilities and stockholders'
equity $ 81,336 $ 78,148
Reconciliation of Reported Income to
Adjusted EBITDA
(In Thousands of Dollars)
Three Months Ended Nine Months Ended 12/31/11
12/31/10 12/31/11 12/31/10 Net sales $ 19,599 $
19,614 $ 55,727 $ 51,260 Cost of sales 11,644 12,339
32,429 31,676 Gross profit 7,955 7,275 23,298 19,584
Selling, general and administrative expenses 3,883 3,972
11,638 10,563 Engineering expense 2,127 1,462 6,475 4,317
Relocation expense
-
-
- 211 Operating income 1,945 1,841 5,185 4,493
Add back: Depreciation and amortization 369 472 1,135 1,470
Relocation expense
-
- - 211 Adjusted EBITDA $ 2,314 $ 2,313 $
6,320 $ 6,174
Net income $ 1,059 $ 953 $ 2,772 $ 2,185 Provision for income taxes
767 690 2,008 1,582 Depreciation and amortization 369 472 1,135
1,470 Relocation expense - - - 211 Interest expense 80 167 316 550
Other expense-net 39 31 89 176 Adjusted
EBITDA $ 2,314 $ 2,313 $ 6,320 $ 6,174
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