PGT Reports 2011 Second Quarter Results
August 03 2011 - 4:17PM
PGT, Inc. (Nasdaq:PGTI), the leading U.S. manufacturer and supplier
of residential impact-resistant windows and doors, announces
financial results for the second quarter ended July 2, 2011. In our
second quarter:
- Net sales were $45.2 million, a decrease of $3.8 million, or
7.8%, from prior year second quarter;
- Adjusted gross margin was 30.1%, a decrease from the prior year
second quarter gross margin of 31.1%;
- Net loss was $5.0 million compared to a net income of $1
thousand in the second quarter of 2010. Consolidation charges
totaled $1.4 million and additional expenses relating to
manufacturing inefficiencies caused by the consolidation totaled
$3.3 million in the second quarter of 2011;
- Adjusted EBITDA was $4.6 million, compared to EBITDA of $5.3
million in the prior year second quarter.
"Sales decreased 7.8% compared to prior year in part as a result
of temporary capacity constraints and inefficiencies related to our
plant consolidation. We experienced lower sales in our
Aluminum WinGuard product line, with sales down $1.4 million or
6% compared to prior year. Sales also decreased within
our Architectural Systems product lines, by $1.6 million as a
result of the increased softness of the commercial market" said Rod
Hershberger, PGT's President and Chief Executive
Officer. "Housing starts in Florida decreased 5% compared to
the second quarter of 2010, driven mainly by an 8% decrease in
single family starts."
Mr. Hershberger continued, "All of our operating lines from
North Carolina are now in place and operating in Florida, where we
have hired over 350 new positions. Our main focus over the
past and next quarter is getting these new employees fully trained
to be able to execute at the levels that PGT is known for in the
marketplace, and we expect substantially all consolidation related
inefficiencies to be driven from our operations by the end of the
third quarter."
Commenting further on the second quarter of 2011, Jeff Jackson,
PGT's Executive Vice President and Chief Financial Officer, stated,
"Vinyl sales were down 8% when compared to prior year. This
includes a $1.7 million decline in non-impact vinyl sales due to
both temporary capacity constraints as well as our decision to
reduce our efforts related to sales in non-coastal
areas. Vinyl impact sales were up $0.7 million due to a $1.1
million increase in sales of our PremierVue high end line which
continues to gain traction. This was offset by a $0.4 million
decrease in sales of Vinyl WinGuard due to the constraints created
during the consolidation. These constraints will be alleviated
in the coming quarter as our expanded Florida operations become
more efficient. Adjusted EBITDA during the quarter was
$4.6 million, or 10.3% of sales, compared to prior year's second
quarter EBITDA of $5.3 million, or 10.7% of sales. This
decline was due mainly to lost margin from lower sales, somewhat
offset by lower spending in overhead and selling, general and
administrative categories."
Mr. Jackson continued, "In June, we completed the refinancing of
our debt and in doing so created more favorable terms including a
lower interest rate and a due date extension to 2016. During
the quarter, we used $3.2 million of cash in operations. Our
cash balance decreased $7.8 million during the quarter to $7.7
million, primarily due to $5.9 million of cash used for plant
consolidation expenses, a debt principal payment in the amount of
$2.0 million and refinancing fees of $2.4 million. Our net
debt was $40.3 million and our corresponding leverage ratio was
2.8X at the end of the second quarter of 2011."
Conference Call
As previously announced, PGT will hold a conference call
Thursday, August 4, 2011, at 10:30 a.m. eastern time and will
simultaneously broadcast it live over the Internet. To participate
in the teleconference, please dial into the call a few minutes
before the start time: 877-769-6798 (U.S. and Canada) and
678-894-3060 (international). A replay of the call will be
available beginning August 4, 2011, at 1:30 p.m. eastern time
through August 25, 2011. To access the replay, dial 800-642-1687
(U.S. and Canada) and 706-645-9291 (international) and refer to
pass code 82398564.
The webcast will also be available through the Investor
Relations section of the PGT, Inc. website,
http://www.pgtinc.com.
About PGT
PGT(R) pioneered the U.S. impact-resistant window and door
industry and today is the nation's leading manufacturer and
supplier of residential impact-resistant windows and doors. Founded
in 1980, the company employs approximately 1,150 at its
manufacturing, glass laminating and tempering plants in Florida.
Utilizing the latest designs and technology, PGT products are ideal
for new construction and replacement projects serving the
residential, commercial, high-rise and institutional markets. PGT's
product line includes a variety of aluminum and vinyl windows and
doors. Product brands include WinGuard (R); SpectraGuard (TM);
PremierVue (TM); PGT Architectural Systems; and Eze-Breeze(R). PGT
Industries is a wholly owned subsidiary of PGT, Inc. (Nasdaq:PGTI).
The PGT, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=4199
Forward-Looking Statements
Statements in this news release and the schedules hereto, which
are not purely historical facts or which necessarily depend upon
future events, including statements about forecasted financial
performance or other statements about anticipations, beliefs,
expectations, hopes, intentions or strategies for the future, may
be forward-looking statements within the meaning of Section 21E of
the Securities Exchange Act of 1934, as amended. Readers are
cautioned not to place undue reliance on forward-looking
statements. All forward-looking statements are based upon
information available to PGT, Inc. on the date this release was
submitted. PGT, Inc. undertakes no obligation to publicly
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Any
forward-looking statements involve risks and uncertainties that
could cause actual events or results to differ materially from the
events or results described in the forward-looking statements,
including risks or uncertainties related to the Company's revenues
and operating results being highly dependent on, among other
things, the homebuilding industry, aluminum prices, and the
economy. PGT, Inc. may not succeed in addressing these and
other risks. Further information regarding factors that could
affect our financial and other results can be found in the risk
factors section of PGT, Inc.'s most recent annual report on Form
10-K filed with the Securities and Exchange Commission.
Consequently, all forward-looking statements in this release are
qualified by the factors, risks and uncertainties contained
therein.
PGT, INC. AND
SUBSIDIARY |
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS |
(unaudited - in
thousands, except per share amounts) |
|
|
|
|
|
|
Three Months
Ended |
Six Months
Ended |
|
July 2, 2011 |
July 3, 2010 |
July 2, 2011 |
July 3, 2010 |
|
|
|
|
|
Net sales |
$ 45,171 |
$ 49,006 |
$ 85,816 |
$ 89,522 |
Cost of sales |
36,100 |
33,760 |
68,419 |
62,953 |
Gross margin |
9,071 |
15,246 |
17,397 |
26,569 |
Selling, general and administrative
expenses |
12,597 |
13,904 |
25,631 |
25,833 |
(Loss)/income from
operations |
(3,526) |
1,342 |
(8,234) |
736 |
Interest expense |
1,050 |
1,264 |
2,173 |
2,738 |
Other expense (income), net |
461 |
-- |
419 |
(20) |
(Loss)/income before
income taxes |
(5,037) |
78 |
(10,826) |
(1,982) |
Income tax expense |
-- |
77 |
-- |
77 |
Net (loss)/income |
$ (5,037) |
$ 1 |
$ (10,826) |
$ (2,059) |
|
|
|
|
|
Basic net loss/(income) per common share |
$ (0.09) |
$ 0.00 |
$ (0.20) |
$ (0.04) |
|
|
|
|
|
Diluted net loss/(income) per common
share |
$ (0.09) |
$ 0.00 |
$ (0.20) |
$ (0.04) |
|
|
|
|
|
Weighted
average common shares outstanding: |
|
|
|
|
Basic |
53,659 |
53,649 |
53,658 |
46,694 |
|
|
|
|
|
Diluted |
53,659 |
54,334 |
53,658 |
46,694 |
|
|
|
PGT, INC. AND
SUBSIDIARY |
CONDENSED CONSOLIDATED
BALANCE SHEETS |
(in
thousands) |
|
|
|
|
|
|
|
July 2, 2011 |
January 1, 2011 |
ASSETS |
(unaudited) |
|
Current assets: |
|
|
Cash and cash equivalents |
$ 7,677 |
$ 22,012 |
Accounts receivable, net |
18,565 |
13,687 |
Inventories |
11,581 |
10,535 |
Prepaid expenses |
1,104 |
881 |
Other current assets |
3,341 |
4,246 |
Total current assets |
42,268 |
51,361 |
|
|
|
Property, plant and equipment, net |
50,697 |
52,863 |
Other intangible assets, net |
61,040 |
64,291 |
Other assets, net |
2,086 |
604 |
Total assets |
$ 156,091 |
$ 169,119 |
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY |
|
Current liabilities: |
|
|
Accounts payable and accrued expenses |
$ 15,396 |
$ 16,696 |
Deferred income taxes |
185 |
185 |
Current portion of long-term debt and capital
lease obligations |
1,296 |
245 |
Total current liabilities |
16,877 |
17,126 |
Long-term debt and capital lease
obligations |
46,811 |
49,918 |
Deferred income taxes |
17,130 |
17,130 |
Other liabilities |
2,158 |
1,903 |
Total liabilities |
82,976 |
86,077 |
|
|
|
Total shareholders' equity |
73,115 |
83,042 |
Total liabilities and shareholders'
equity |
$ 156,091 |
$ 169,119 |
|
|
|
PGT, INC. AND
SUBSIDIARY |
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES TO THEIR GAAP EQUIVALENTS |
(unaudited - in
thousands, except per share amounts) |
|
|
|
|
|
|
Three Months
Ended |
Six Months
Ended |
|
July 2, 2011 |
July 3, 2010 |
July 2, 2011 |
July 3, 2010 |
Reconciliation to Adjusted Net
Income/(Loss) and Adjusted Net Income/(Loss) per share
(1): |
|
|
|
|
|
|
|
|
|
Net Income/(loss) |
$ (5,037) |
$ 1 |
$ (10,826) |
$ (2,059) |
Reconciling item: |
|
|
|
|
|
|
|
|
|
Consolidation (2) |
1,367 |
-- |
3,998 |
-- |
Manufacturing inefficiencies (3) |
3,371 |
-- |
3,371 |
-- |
Write off deferred financing costs (4) |
420 |
-- |
420 |
-- |
Tax effect of reconciling
items |
-- |
-- |
-- |
-- |
Adjusted net income/(loss) |
$ 121 |
$ 1 |
$ (3,037) |
$ (2,059) |
|
|
|
|
|
Weighted average shares outstanding: |
|
|
|
|
Diluted (5) |
53,659 |
54,334 |
53,658 |
46,694 |
Adjusted net income/(loss) per share -
diluted |
$ 0.00 |
$ 0.00 |
$ (0.06) |
$ (0.04) |
|
|
|
|
|
Reconciliation to EBITDA and Adjusted
EBITDA: |
|
|
|
|
Net Income/(loss) |
$ (5,037) |
$ 1 |
$ (10,826) |
$ (2,059) |
Reconciling items: |
|
|
|
|
Depreciation and amortization
expense |
3,477 |
3,921 |
7,025 |
7,887 |
Interest expense |
1,050 |
1,264 |
2,173 |
2,738 |
Income tax expense |
-- |
77 |
-- |
77 |
EBITDA |
(510) |
5,263 |
(1,628) |
8,643 |
Consolidation (2) |
1,367 |
-- |
3,998 |
-- |
Manufacturing inefficiencies (3) |
3,371 |
-- |
3,371 |
-- |
Write off deferred financing costs (4) |
420 |
-- |
420 |
-- |
Adjusted EBITDA |
$ 4,648 |
$ 5,263 |
$ 6,161 |
$ 8,643 |
Adjusted EBITDA as percentage of net
sales |
10.3% |
10.7% |
7.2% |
9.7% |
|
|
|
|
(1) The Company's non-GAAP
financial measures were explained in its Form 8-K filed August 3,
2011. |
(2) Represents charges related to
consolidation actions taken in 2011. These charges relate
primarily to employee separation costs and move related
expenses. Of the $1.4 million consolidation charge in three
months ended July 2, 2011, $1.2 million is included in costs of
goods sold and $0.2 million is included in selling, general and
administrative expenses. Of the $4.0 million in consolidation
charges in the six months ended July 2, 2011, $3.3 million is
included in cost of goods sold and $0.7 million is included in
selling, general and administrative expenses. |
(3) Represents temporary excess
labor and scrap expense incurred as a result of the consolidation
actions taken in 2011. The amounts were determined by
comparing the second quarter manufacturing results with normalized
pre-consolidation quarter results. These charges are included
in cost of goods sold for the three and six months ended July 2,
2011. |
(4) Represents the write
off of the remaining unamortized fees associated with our
previous financing agreement. These charges are included in
other expense for the three and six months ended July 2, 2011. |
(5) Due to the actual net losses
in the second quarter of 2011, and the first six months of 2011 and
2010, the effect of equity compensation plans is
anti-dilutive. |
CONTACT: Jeffrey T. Jackson
Executive Vice President and CFO
941-480-2714
jjackson@pgtindustries.com
PGT (NYSE:PGTI)
Historical Stock Chart
From May 2024 to Jun 2024
PGT (NYSE:PGTI)
Historical Stock Chart
From Jun 2023 to Jun 2024