Acuity Brands, Inc. (NYSE:AYI) (“Company”) today announced that
fiscal 2017 third quarter net sales increased $40.1 million, or 5
percent, to $891.6 million from $851.5 million reported in the
prior-year period. Operating profit for the third quarter of
fiscal 2017 was $131.5 million, an increase of $10.5 million, or 9
percent, over the year-ago period. Net income for the third
quarter of fiscal 2017 was $82.2 million, an increase of $8.2
million, or 11 percent, compared with the prior-year period.
Fiscal 2017 third quarter diluted earnings per share (“EPS”) of
$1.90 increased $0.21, or 12 percent, compared with $1.69 for the
year-ago period.
Adjusted diluted EPS for the third quarter of
fiscal 2017 increased over 4 percent to $2.15 compared with
adjusted diluted EPS of $2.06 for the year-ago period.
Adjusted operating profit for the third quarter of fiscal 2017
increased $2.2 million, or 2 percent, to $148.3 million, or 16.6
percent of net sales, compared with the year-ago period adjusted
operating profit of $146.1 million, or 17.2 percent of net
sales. Adjusted results exclude the impact of amortization
expense for acquired intangible assets, share-based payment
expense, acquisition-related items (including acquired profit in
inventory and professional fees), and special charges for
streamlining activities. Management believes these items
impacted the comparability of the Company's results and that
adjusted financial measures enhance the reader’s overall
understanding of the Company's current financial performance by
making results comparable between periods. A reconciliation
of adjusted financial measures to the most directly comparable U.S.
GAAP measure is provided in the tables at the end of this
release.
Vernon J. Nagel, Chairman, President, and Chief
Executive Officer of Acuity Brands, commented, “Our third quarter
net sales reflect continued solid performance even though initial
industry data suggests that the growth rate of the Company’s key
end markets in North America grew only in the low single-digit
range. We believe the market growth rate reflected continued
softness in demand for certain short-cycled, smaller lighting
projects. Despite achieving record third quarter net sales
and earnings, our profitability was negatively impacted by higher
than normal supply chain costs, including increased quality expense
and greater inbound freight charges.
“During the quarter, we continued to invest in
areas we believe have longer-term growth potential and made
significant progress this quarter on a number of strategic fronts,
the most important of which was the announcement of our newly
branded Atrius™ Internet of Things (“IoT”) platform and software
solutions. Through Atrius, Acuity Brands continues to provide
and expand its comprehensive set of IoT business solutions,
leveraging intelligent luminaires, lighting and building management
controls, software platform services, and solution development
tools. Atrius provides a robust, scalable, and secure
software platform that enables an array of capabilities, including
indoor positioning, asset tracking, space utilization, spatial
analytics and energy management. Lastly, we saw customers,
including many of those formerly in pilot programs, move to
accelerate the implementation of our Atrius-based intelligent
solutions capabilities. These anticipated deployments will
provide our customers with unique capabilities to enhance the
performance of their facilities while more than quadrupling our
installed base of these solutions.”
Third Quarter Results
The 5 percent year-over-year growth in fiscal
2017 third quarter net sales was due primarily to a 6 percent
increase in volume, partially offset by an approximately 1 percent
net unfavorable change in product prices and mix of products sold
(“price/mix”) as well as a modest unfavorable impact from changes
in foreign currency exchange rates. Sales volume was higher
across most key product categories and sales channels. The change
in price/mix was due primarily to lower pricing on luminaires,
partially as a result of lower LED component costs. Robust
adoption of LED-based products continued during the third quarter
of fiscal 2017 and represented approximately two-thirds of the
Company’s total net sales.
Fiscal 2017 third quarter gross profit margin of
42.5 percent declined 190 basis points compared with prior-year’s
record gross profit margin of 44.4 percent and 200 basis points
lower than last year’s adjusted gross profit margin of 44.5
percent. Gross profit margin was lower than the prior-year
period due primarily to higher than normal supply chain costs,
including increased quality expense and greater inbound freight
charges, as well as unfavorable price/mix. Selling,
distribution & administrative (“SD&A”) expenses for the
quarter ended May 31, 2017, were $246.9 million, or 27.7 percent of
net sales, compared with $247.2 million, or 29.0 percent, for the
year-ago period. Fiscal 2017 third quarter adjusted SD&A
expenses were $230.6 million, or 25.9 percent of net sales,
compared with prior year’s $232.7 million, or 27.3 percent, a
decline of 140 basis points. The slight decrease in adjusted
SDA expense was primarily due to lower incentive compensation
expense, partially offset by higher freight and commission costs to
support the increase in net sales and continued investment in
additional headcount to support and drive the Company’s tiered
solutions strategy.
The Company recorded a pre-tax special charge of
$0.5 million and $9.7 million during the third quarters of fiscal
2017 and 2016, respectively, for actions initiated to streamline
the organization, including the integration of recent
acquisitions. These streamlining activities include the
consolidation of selected production activities and realignment of
certain responsibilities, primarily within various SD&A
departments.
Year-to-Date Results
Net sales for the first nine months of fiscal
2017 increased 8 percent to $2,547.5 million compared with $2,365.9
million for the prior-year period. Reported results for the
first nine months of fiscal 2017 included operating profit of
$366.1 million, net income of $231.2 million, and diluted EPS of
$5.29.
Adjusted operating profit for the first nine
months of fiscal 2017 increased $16.3 million, or 4 percent, to
$415.4 million, or 16.3 percent of net sales, compared with prior
year’s adjusted operating profit of $399.1 million, or 16.9 percent
of net sales. Adjusted net income for the first nine months
of fiscal 2017 was $258.6 million compared with $246.5 million for
the prior-year period, an increase of 5 percent. Adjusted
diluted EPS for the first nine months of fiscal 2017 increased
$0.29, or 5 percent, to $5.92 compared with adjusted diluted EPS of
$5.63 for the year-ago period. Adjusted results exclude
amortization expense for acquired intangible assets, share-based
payment expense, acquisition-related items (including profit in
inventory, professional fees, and certain contract termination
costs), special charges for streamlining activities, manufacturing
inefficiencies related to the closing of a facility, and a gain on
the sale of an investment in an unconsolidated affiliate. The
total impact of these items on diluted EPS for the first nine
months of fiscal 2017 and 2016 was $0.63 and $0.88,
respectively. A reconciliation of adjusted financial measures
to the most directly comparable U.S. GAAP measure is provided in
the tables at the end of this release.
Net miscellaneous income for the nine months
ended May 31, 2017, included a $7.2 million gain associated with
the sale of an investment in an unconsolidated affiliate, which
occurred in the first quarter of the fiscal year.
Cash and cash equivalents at the end of the
third quarter of fiscal 2017 totaled $189.7 million, a decrease of
$223.5 million since the beginning of the fiscal year. During
fiscal 2017, the Company completed the buyback of 2 million shares
of Acuity Brands common stock under its previously authorized stock
repurchase program at a total cost of $357.9 million.
Stock Repurchase
Authorization
Earlier this week, the Board of Directors of
Acuity Brands authorized the repurchase of up to 2 million shares,
or approximately 5 percent, of the Company’s outstanding common
stock. Mr. Nagel said, “Last month, we completed the
repurchase of 2 million shares under our previous buyback program,
and this new authorization provides management with the ongoing
flexibility to repurchase shares in the future, as
appropriate. We believe that repurchasing our shares
represents a wise use of our cash flow, especially during periods
of high stock price volatility, and also allows us to offset
dilution resulting from our share-based compensation and benefit
programs. Additionally, we believe that repurchases of the
Company’s stock supports Acuity Brands’ objective to maximize
long-term stockholder value, while continuing to fund investments
to better serve our customers, grow our businesses, and improve our
operating and financial performance.”
Under the current authorization, the Company may
acquire shares through open market transactions, subject to market
conditions and other factors. The Company may also enter into
Rule 10b5-1 plans to facilitate open market repurchases. A
Rule 10b5-1 plan would generally permit the Company to repurchase
shares at times when it might otherwise be prevented from doing so
under certain securities laws provided the plan is adopted when the
Company is not in possession of material non-public
information. Shares repurchased under the authorization may
be retired or used for general corporate purposes, which may
include transactions related to the Company’s share-based
compensation and employee benefit plans.
Outlook
Mr. Nagel commented, “While forecasts suggest
that softness in demand in the North American lighting market that
began in the third calendar quarter of 2016 will continue through
the remainder of the calendar year, we still see encouraging signs
that support third-party forecasts for improvement in growth rates
in calendar year 2018. Current quoting activity remains
favorable, and both short and long-term fundamental drivers of the
markets that the Company serves remain positive. We are
aggressively addressing our recent supply chain issues and
accelerating programs to reduce product costs to maintain our
competitiveness and drive improved profitability. We expect
to continue to outperform the growth rates of the markets that the
Company serves by executing our strategies focused on growth
opportunities for new construction and renovation projects,
expansion into underpenetrated geographies and channels, and growth
from the continued introduction of new lighting and building
management solutions as part of the Company’s integrated, tiered
solutions strategy. Based on various leading indicators, our
focused investments in key strategic areas, and aggressive
management of supply chain costs, we remain bullish regarding the
Company’s prospects for continued future profitable growth.”
Mr. Nagel concluded, “We believe the lighting
and lighting-related industry as well as building management
systems will experience solid growth over the next decade,
particularly as energy and environmental concerns come to the
forefront along with emerging opportunities for digital lighting to
play a key role in the Internet of Things. We believe we are
uniquely positioned to fully participate in this exciting
industry.”
Conference Call
As previously announced, the Company will host a
conference call to discuss third quarter results today, June 29,
2017, at 10:00 a.m. ET. Interested parties may listen to this
call live today or hear a replay at the Company's Web site:
www.acuitybrands.com.
About Acuity Brands
Acuity Brands, Inc. (NYSE:AYI) is the North
American market leader and one of the world’s leading providers of
lighting and building management solutions. With fiscal year 2016
net sales of $3.3 billion, Acuity Brands currently employs
approximately 12,000 associates and is headquartered in Atlanta,
Georgia with operations throughout North America, and in Europe and
Asia. The Company’s products and solutions are sold under various
brands, including Lithonia Lighting®, Holophane®, Peerless®,
Gotham®, Mark Architectural Lighting™, Winona® Lighting, Juno®,
Indy™, Aculux®, Healthcare Lighting®, Hydrel®, American Electric
Lighting®, Carandini®, Antique Street Lamps™, Sunoptics®, Distech
Controls®, Acuity Controls™, nLight®, ROAM®, Sensor Switch® and
Atrius™. Visit us www.acuitybrands.com.
Non-GAAP Financial Measures
This news release includes the following
non-GAAP financial measures: "adjusted gross profit," “adjusted
gross profit margin,” “adjusted SD&A expenses,” “adjusted
operating profit,” “adjusted operating profit margin,” “adjusted
other expense,” “adjusted net income,” and “adjusted diluted EPS.”
These non-GAAP financial measures are provided to enhance the
reader's overall understanding of the Company's current financial
performance and prospects for the future. During fiscal 2016, the
Company acquired four businesses, which impacted the comparability
of many of its GAAP financial measures. Specifically,
management believes that these non-GAAP measures provide useful
information to investors by excluding or adjusting items for
amortization of acquired intangible assets, acquisition-related
items, share-based payment expense, which is used as a method to
improve retention and align the interests of key leaders of
acquired businesses with those of the Company’s shareholders,
special charges associated with efforts to streamline the
organization that we execute on an ongoing basis and integrate
acquisitions, manufacturing inefficiencies directly related to the
closure of a facility, and a gain associated with the sale of an
investment in an unconsolidated affiliate. Management
typically adjusts for these items for internal reviews of
performance and uses the above non-GAAP measures for baseline
comparative operational analysis, decision making, and other
activities. Management believes these non-GAAP measures
provide greater comparability and enhanced visibility into the
Company’s results of operations as well as comparability with many
of its peers, especially those companies focused more on technology
and software.
Adjustments related to acquisitions include
acquired profit in inventory, professional fees, and certain
contract termination costs. While these costs are not
operational in nature and are not expected to continue for any
singular transaction on an ongoing basis, similar types of costs,
expenses and charges have occurred in prior periods and may recur
in the future as the Company continues to integrate prior
acquisitions and pursues any future acquisitions.
Non-GAAP financial measures included in this
news release should be considered in addition to, and not as a
substitute for or superior to, results prepared in accordance with
GAAP. The most directly comparable GAAP measures for adjusted gross
profit and adjusted gross profit margin are gross profit and gross
profit margin, respectively, which includes the impact of
acquisition-related items and manufacturing inefficiencies directly
related to the closure of a facility. The most directly comparable
GAAP measure for adjusted SD&A expenses is “SD&A expenses”
which includes acquisition-related items, amortization of acquired
intangible assets, and share-based payment expense. The most
directly comparable GAAP measures for adjusted operating profit and
adjusted operating profit margin are “operating profit” and
“operating profit margin,” respectively, which include the impact
of acquisition-related items, manufacturing inefficiencies directly
related to the closure of a facility, amortization of acquired
intangible assets, share-based payment expense, and special
charges. The most directly comparable GAAP measures for
adjusted other expense (income) is “other expense (income),” which
includes the impact of a gain on sale of investment in an
unconsolidated affiliate. The most directly comparable GAAP
measures for adjusted net income and adjusted diluted EPS are “net
income” and “diluted EPS,” respectively, which include the impact
of acquisition-related items, manufacturing inefficiencies directly
related to the closure of a facility, amortization of acquired
intangible assets, share-based payment expense, special charges,
and a gain on sale of investment in an unconsolidated
affiliate. A reconciliation of each measure to the most
directly comparable GAAP measure is available in this news
release. The Company’s non-GAAP financial measures may not be
comparable to similarly titled non-GAAP financial measures used by
other companies, have limitations as an analytical tool, and should
not be considered in isolation or as a substitute for GAAP
financial measures.
Forward Looking Information
This release contains forward-looking
statements, within the meaning of the Private Securities Litigation
Reform Act of 1995. Statements that may be considered
forward-looking include statements incorporating terms such as
"expects," "believes," "intends," “estimates,” “forecasts,”
"anticipates," “could,” “may,” “should,” “suggest,” “remain,”
“will,” and similar terms that relate to future events,
performance, or results of the Company and specifically include
statements made in this press release regarding: third-party
forecasts suggesting softness in demand in the North American
lighting market will continue through the remainder of the calendar
year and improvement in growth rates in calendar year 2018; current
favorable quoting activity and positive short and long-term
fundamental drivers of the markets that the Company serves; efforts
to maintain the Company’s competitiveness and drive improved
profitability; prospects for continued future profitable growth and
expectations for the Company to continue to outperform the growth
rates of the markets it serves and execute strategies related to
growth opportunities; overall demand in the Company’s end markets
to continue to experience solid growth over the next decade as well
as the Company’s position to fully participate; anticipated
deployments of Atrius-based solutions by customers that will more
than quadruple the installed base of such solutions; and repurchase
of the Company’s common stock under the new authorization.
Please see the other risk factors more fully described in the
Company’s SEC filings including risks discussed in Part I, “Item
1a. Risk Factors” in the Company’s Annual Report on Form 10-K for
the year ended August 31, 2016. The discussion of those risks
is specifically incorporated herein by reference. Management
believes these forward-looking statements are reasonable; however,
undue reliance should not be placed on any forward-looking
statements, which are based on current expectations. Further,
forward-looking statements speak only as of the date they are made,
and management undertakes no obligation to update publicly any of
them in light of new information or future events.
ACUITY BRANDS, INC. |
CONSOLIDATED BALANCE SHEETS |
(In millions, except share data) |
|
May 31, 2017 |
|
August 31, 2016 |
(Unaudited) |
|
|
ASSETS |
|
|
|
Current Assets: |
|
|
|
Cash and
cash equivalents |
$ |
189.7 |
|
|
$ |
413.2 |
|
Accounts
receivable, less reserve for doubtful accounts of $1.8 and $1.7,
respectively |
|
521.1 |
|
|
|
572.8 |
|
Inventories |
|
342.2 |
|
|
|
295.2 |
|
Prepayments and other current assets |
|
41.1 |
|
|
|
41.7 |
|
Total
Current Assets |
|
1,094.1 |
|
|
|
1,322.9 |
|
Property, Plant, and
Equipment, at cost: |
|
|
|
Land |
|
22.2 |
|
|
|
23.1 |
|
Buildings
and leasehold improvements |
|
182.8 |
|
|
|
174.4 |
|
Machinery
and equipment |
|
470.6 |
|
|
|
448.2 |
|
Total
Property, Plant, and Equipment |
|
675.6 |
|
|
|
645.7 |
|
Less -
Accumulated depreciation and amortization |
|
(391.2 |
) |
|
|
(377.9 |
) |
Property,
Plant, and Equipment, net |
|
284.4 |
|
|
|
267.8 |
|
Goodwill |
|
887.5 |
|
|
|
947.8 |
|
Intangible assets, net |
|
448.3 |
|
|
|
381.4 |
|
Deferred
income taxes |
|
4.6 |
|
|
|
5.1 |
|
Other
long-term assets |
|
11.6 |
|
|
|
23.0 |
|
Total
Assets |
$ |
2,730.5 |
|
|
$ |
2,948.0 |
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
Current
Liabilities: |
|
|
|
Accounts
payable |
$ |
359.8 |
|
|
$ |
401.0 |
|
Current
maturities of long-term debt |
|
0.4 |
|
|
|
0.2 |
|
Accrued
compensation |
|
26.1 |
|
|
|
95.2 |
|
Other
accrued liabilities |
|
158.0 |
|
|
|
176.1 |
|
Total
Current Liabilities |
|
544.3 |
|
|
|
672.5 |
|
Long-Term Debt |
|
356.3 |
|
|
|
355.0 |
|
Accrued Pension
Liabilities, less current portion |
|
116.3 |
|
|
|
119.9 |
|
Deferred Income
Taxes |
|
106.8 |
|
|
|
74.6 |
|
Self-Insurance
Reserves, less current portion |
|
8.0 |
|
|
|
7.2 |
|
Other Long-Term
Liabilities |
|
63.6 |
|
|
|
59.0 |
|
Total
Liabilities |
|
1,195.3 |
|
|
|
1,288.2 |
|
Stockholders’
Equity: |
|
|
|
Preferred
stock, $0.01 par value; 50,000,000 shares authorized; none
issued |
|
- |
|
|
|
- |
|
Common
stock, $0.01 par value; 500,000,000 shares authorized; 53,525,242
and 53,415,687issued, respectively |
|
0.5 |
|
|
|
0.5 |
|
Paid-in
capital |
|
875.4 |
|
|
|
856.4 |
|
Retained
earnings |
|
1,574.9 |
|
|
|
1,360.9 |
|
Accumulated other comprehensive loss |
|
(139.5 |
) |
|
|
(139.4 |
) |
Treasury
stock, at cost - 11,678,002 and 9,679,457 shares,
respectively |
|
(776.1 |
) |
|
|
(418.6 |
) |
Total
Stockholders’ Equity |
|
1,535.2 |
|
|
|
1,659.8 |
|
Total
Liabilities and Stockholders’ Equity |
$ |
2,730.5 |
|
|
$ |
2,948.0 |
|
|
ACUITY BRANDS, INC. |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME (Unaudited) |
(In millions, except per-share
data) |
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
May 31, 2017 |
|
May 31, 2016 |
|
May 31, 2017 |
|
May 31, 2016 |
Net
Sales |
$ |
891.6 |
|
|
$ |
851.5 |
|
$ |
2,547.5 |
|
|
$ |
2,365.9 |
|
Cost of
Products Sold |
|
512.7 |
|
|
|
473.6 |
|
|
1,473.2 |
|
|
|
1,331.7 |
|
Gross
Profit |
|
378.9 |
|
|
|
377.9 |
|
|
1,074.3 |
|
|
|
1,034.2 |
|
Selling,
Distribution, and Administrative Expenses |
|
246.9 |
|
|
|
247.2 |
|
|
706.5 |
|
|
|
683.9 |
|
Special
Charge |
|
0.5 |
|
|
|
9.7 |
|
|
1.7 |
|
|
|
10.2 |
|
Operating Profit |
|
131.5 |
|
|
|
121.0 |
|
|
366.1 |
|
|
|
340.1 |
|
Other
Expense (Income): |
|
|
|
|
|
|
|
Interest
Expense, net |
|
8.1 |
|
|
|
8.1 |
|
|
24.3 |
|
|
|
24.2 |
|
Miscellaneous (Income) Expense , net |
|
(1.2 |
) |
|
|
0.3 |
|
|
(8.5 |
) |
|
|
(1.5 |
) |
Total
Other Expense |
|
6.9 |
|
|
|
8.4 |
|
|
15.8 |
|
|
|
22.7 |
|
Income
before Provision for Income Taxes |
|
124.6 |
|
|
|
112.6 |
|
|
350.3 |
|
|
|
317.4 |
|
Provision for Income Taxes |
|
42.4 |
|
|
|
38.6 |
|
|
119.1 |
|
|
|
109.5 |
|
Net
Income |
$ |
82.2 |
|
|
$ |
74.0 |
|
$ |
231.2 |
|
|
$ |
207.9 |
|
|
|
|
|
|
|
|
|
Earnings
Per Share: |
|
|
|
|
|
|
|
Basic
Earnings per Share |
$ |
1.91 |
|
|
$ |
1.70 |
|
$ |
5.31 |
|
|
$ |
4.78 |
|
Basic
Weighted Average Number of Shares Outstanding |
|
43.1 |
|
|
|
43.5 |
|
|
43.5 |
|
|
|
43.4 |
|
Diluted
Earnings per Share |
$ |
1.90 |
|
|
$ |
1.69 |
|
$ |
5.29 |
|
|
$ |
4.75 |
|
Diluted
Weighted Average Number of Shares Outstanding |
|
43.3 |
|
|
|
43.8 |
|
|
43.7 |
|
|
|
43.7 |
|
Dividends Declared per Share |
$ |
0.13 |
|
|
$ |
0.13 |
|
$ |
0.39 |
|
|
$ |
0.39 |
|
|
Comprehensive Income: |
|
|
|
|
|
|
|
Net
Income |
$ |
82.2 |
|
|
$ |
74.0 |
|
$ |
231.2 |
|
|
$ |
207.9 |
|
Other Comprehensive
Income (Loss) Items: |
|
|
|
|
|
|
|
Foreign
currency translation adjustments |
|
2.4 |
|
|
|
10.0 |
|
|
(6.2 |
) |
|
|
(3.4 |
) |
Defined
benefit pension plans, net of tax |
|
2.0 |
|
|
|
1.3 |
|
|
6.1 |
|
|
|
4.0 |
|
Other Comprehensive
Income (Loss), net of tax |
|
4.4 |
|
|
|
11.3 |
|
|
(0.1 |
) |
|
|
0.6 |
|
Comprehensive
Income |
$ |
86.6 |
|
|
$ |
85.3 |
|
$ |
231.1 |
|
|
$ |
208.5 |
|
|
|
|
|
|
|
|
|
ACUITY BRANDS, INC. |
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) |
|
(In millions) |
|
|
Nine
Months Ended |
|
|
|
|
May 31, 2017 |
|
May 31, 2016 |
|
Cash Flows from
Operating Activities: |
|
|
|
|
Net
income |
$ |
231.2 |
|
|
$ |
207.9 |
|
|
Adjustments to reconcile net income to net cash provided by (used
for)operating activities: |
|
|
|
|
Depreciation and amortization |
|
56.5 |
|
|
|
49.0 |
|
|
Share-based payment expense |
|
24.1 |
|
|
|
19.9 |
|
|
Excess
tax benefits from share-based payments |
|
(5.5 |
) |
|
|
(19.7 |
) |
|
Loss
(gain) on sale or disposal of property, plant, and equipment |
|
0.3 |
|
|
|
(1.1 |
) |
|
Gain on
sale of investment in unconsolidated affiliate |
|
(7.2 |
) |
|
|
- |
|
|
Deferred
income taxes |
|
(2.8 |
) |
|
|
- |
|
|
Change in
assets and liabilities, net of effect of acquisitions,
divestituresand effect of exchange rate changes: |
|
|
|
|
Accounts
receivable |
|
50.4 |
|
|
|
(15.9 |
) |
|
Inventories |
|
(47.1 |
) |
|
|
(14.2 |
) |
|
Prepayments and other current assets |
|
(3.5 |
) |
|
|
(9.0 |
) |
|
Accounts
payable |
|
(37.7 |
) |
|
|
18.9 |
|
|
Other
current liabilities |
|
(81.4 |
) |
|
|
12.4 |
|
|
Other |
|
2.0 |
|
|
|
(4.3 |
) |
|
Net Cash
Provided by Operating Activities |
|
179.3 |
|
|
|
243.9 |
|
|
Cash Flows fom
Investing Activities: |
|
|
|
|
Purchases
of property, plant, and equipment |
|
(55.2 |
) |
|
|
(61.8 |
) |
|
Proceeds
from sale of property, plant, and equipment |
|
5.5 |
|
|
|
2.3 |
|
|
Acquisition of businesses, net of cash acquired |
|
- |
|
|
|
(613.7 |
) |
|
Proceeds
from sale of investment in unconsolidated affiliate |
|
13.2 |
|
|
|
- |
|
|
Other
investing activities |
|
(0.2 |
) |
|
|
- |
|
|
Net Cash
Used for Investing Activities |
|
(36.7 |
) |
|
|
(673.2 |
) |
|
Cash Flows from
Financing Activities: |
|
|
|
|
Issuance
of long-term debt |
|
1.1 |
|
|
|
1.7 |
|
|
Repurchases of common stock |
|
(357.9 |
) |
|
|
- |
|
|
Proceeds
from stock option exercises and other |
|
2.7 |
|
|
|
10.0 |
|
|
Excess
tax benefits from share-based payments |
|
5.5 |
|
|
|
19.7 |
|
|
Dividends
paid |
|
(17.2 |
) |
|
|
(17.1 |
) |
|
Net Cash
(Used for) Provided by Financing Activities |
|
(365.8 |
) |
|
|
14.3 |
|
|
Effect of Exchange Rate
Changes on Cash and Cash Equivalents |
|
(0.3 |
) |
|
|
(4.8 |
) |
|
Net Change in Cash and
Cash Equivalents |
|
(223.5 |
) |
|
|
(419.8 |
) |
|
Cash and Cash
Equivalents at Beginning of Period |
|
413.2 |
|
|
|
756.8 |
|
|
Cash and Cash
Equivalents at End of Period |
$ |
189.7 |
|
|
$ |
337.0 |
|
|
|
ACUITY BRANDS,
INC.Reconciliation of Non-U.S. GAAP
Measures |
|
The tables
below reconcile certain GAAP financial measures to the
corresponding non-GAAPmeasures: |
|
(In millions, except
Diluted Earnings per Share) |
|
|
|
|
|
|
|
Three Months Ended |
|
Increase(Decrease) |
|
PercentChange |
|
|
May 31,2017 |
|
May 31,2016 |
|
|
|
Net Sales |
$ |
891.6 |
|
|
$ |
851.5 |
|
|
$ |
40.1 |
|
|
4.7 |
% |
|
|
|
|
|
|
|
|
|
|
Gross Profit
(GAAP) |
$ |
378.9 |
|
|
$ |
377.9 |
|
|
|
|
|
|
Add-back:
Acquisition-related items(1) |
|
- |
|
|
|
0.9 |
|
|
|
|
|
|
Adjusted Gross Profit
(Non-GAAP) |
$ |
378.9 |
|
|
$ |
378.8 |
|
|
$ |
0.1 |
|
|
- |
% |
|
Percent
of Sales |
|
42.5 |
% |
|
|
44.5 |
% |
|
|
(200 |
) |
bps |
|
|
|
|
|
|
|
|
|
|
Selling, Distribution,
and Administrative (SD&A) Expenses (GAAP) |
$ |
246.9 |
|
|
$ |
247.2 |
|
|
|
|
|
|
Less:
Amortization of acquired intangible assets |
|
(8.2 |
) |
|
|
(7.5 |
) |
|
|
|
|
|
Less:
Share-based payment expense |
|
(8.1 |
) |
|
|
(6.9 |
) |
|
|
|
|
|
Less:
Acquisition-related items(1) |
|
- |
|
|
|
(0.1 |
) |
|
|
|
|
|
Adjusted
SD&A Expenses (Non-GAAP) |
$ |
230.6 |
|
|
$ |
232.7 |
|
|
$ |
(2.1 |
) |
|
(0.9 |
)% |
|
Percent
of Sales |
|
25.9 |
% |
|
|
27.3 |
% |
|
|
(140 |
) |
bps |
|
|
|
|
|
|
|
|
|
|
Operating Profit
(GAAP) |
$ |
131.5 |
|
|
$ |
121.0 |
|
|
|
|
|
|
Add-back:
Amortization of acquired intangible assets |
|
8.2 |
|
|
|
7.5 |
|
|
|
|
|
|
Add-back:Share-based payment expense |
|
8.1 |
|
|
|
6.9 |
|
|
|
|
|
|
Add-back:
Acquisition-related items(1) |
|
- |
|
|
|
1.0 |
|
|
|
|
|
|
Add-back:
Special charge |
|
0.5 |
|
|
|
9.7 |
|
|
|
|
|
|
Adjusted
Operating Profit (Non-GAAP) |
$ |
148.3 |
|
|
$ |
146.1 |
|
|
$ |
2.2 |
|
|
1.5 |
% |
|
Percent
of Sales |
|
16.6 |
% |
|
|
17.2 |
% |
|
|
(60 |
) |
bps |
|
|
|
|
|
|
|
|
|
|
Net Income (GAAP) |
$ |
82.2 |
|
|
$ |
74.0 |
|
|
|
|
|
|
Add-back:
Amortization of acquired intangible assets |
|
8.2 |
|
|
|
7.5 |
|
|
|
|
|
|
Add-back:Share-based payment expense |
|
8.1 |
|
|
|
6.9 |
|
|
|
|
|
|
Add-back:
Acquisition-related items(1) |
|
- |
|
|
|
1.0 |
|
|
|
|
|
|
Add-back:
Special charge |
|
0.5 |
|
|
|
9.7 |
|
|
|
|
|
|
Total
pre-tax adjustments to Net Income |
|
16.8 |
|
|
|
25.1 |
|
|
|
|
|
|
Income
tax effect |
|
(5.9 |
) |
|
|
(8.7 |
) |
|
|
|
|
|
Adjusted
Net Income (Non-GAAP) |
$ |
93.1 |
|
|
$ |
90.4 |
|
|
$ |
2.7 |
|
|
3.0 |
% |
|
|
|
|
|
|
|
|
|
|
Diluted Earnings per
Share (GAAP) |
$ |
1.90 |
|
|
$ |
1.69 |
|
|
|
|
|
|
Adjusted Diluted
Earnings per Share (Non-GAAP) |
$ |
2.15 |
|
|
$ |
2.06 |
|
|
$ |
0.09 |
|
|
4.4 |
% |
|
|
(1) Acquisiton-related items include acquired profit in
inventory and professional fees. |
|
|
|
|
|
|
|
|
(In millions, except
Diluted Earnings per Share) |
|
|
|
|
|
|
|
Nine Months Ended |
|
Increase(Decrease) |
|
PercentChange |
|
|
May 31,2017 |
|
May 31,2016 |
|
|
|
Net Sales |
$ |
2,547.5 |
|
|
$ |
2,365.9 |
|
|
$ |
181.6 |
|
|
7.7 |
% |
|
|
|
|
|
|
|
|
|
|
Gross Profit
(GAAP) |
$ |
1,074.3 |
|
|
$ |
1,034.2 |
|
|
|
|
|
|
Add-back:
Acquisition-related items(1) |
|
- |
|
|
|
2.7 |
|
|
|
|
|
|
Add-back:
Manufacturing Inefficiencies(2) |
|
1.6 |
|
|
|
- |
|
|
|
|
|
|
Adjusted Gross Profit
(Non-GAAP) |
$ |
1,075.9 |
|
|
$ |
1,036.9 |
|
|
$ |
39.0 |
|
|
3.8 |
% |
|
Percent
of Sales |
|
42.2 |
% |
|
|
43.8 |
% |
|
|
(160 |
) |
bps |
|
|
|
|
|
|
|
|
|
|
Selling, Distribution,
and Administrative (SD&A) Expenses (GAAP) |
$ |
706.5 |
|
|
$ |
683.9 |
|
|
|
|
|
|
Less:
Amortization of acquired intangible assets |
|
(21.9 |
) |
|
|
(18.5 |
) |
|
|
|
|
|
Less:
Share-based payment expense |
|
(24.1 |
) |
|
|
(19.9 |
) |
|
|
|
|
|
Less:
Acquisition-related items(1) |
|
- |
|
|
|
(7.7 |
) |
|
|
|
|
|
Adjusted
SD&A Expenses (Non-GAAP) |
$ |
660.5 |
|
|
$ |
637.8 |
|
|
$ |
22.7 |
|
|
3.6 |
% |
|
Percent
of Sales |
|
25.9 |
% |
|
|
27.0 |
% |
|
|
(110 |
) |
bps |
|
|
|
|
|
|
|
|
|
|
Operating Profit
(GAAP) |
$ |
366.1 |
|
|
$ |
340.1 |
|
|
|
|
|
|
Add-back:
Amortization of acquired intangible assets |
|
21.9 |
|
|
|
18.5 |
|
|
|
|
|
|
Add-back:Share-based payment expense |
|
24.1 |
|
|
|
19.9 |
|
|
|
|
|
|
Add-back:
Acquisition-related items(1) |
|
- |
|
|
|
10.4 |
|
|
|
|
|
|
Add-back:
Manufacturing Inefficiencies(2) |
|
1.6 |
|
|
|
- |
|
|
|
|
|
|
Add-back:
Special charge |
|
1.7 |
|
|
|
10.2 |
|
|
|
|
|
|
Adjusted
Operating Profit (Non-GAAP) |
$ |
415.4 |
|
|
$ |
399.1 |
|
|
$ |
16.3 |
|
|
4.1 |
% |
|
Percent
of Sales |
|
16.3 |
% |
|
|
16.9 |
% |
|
|
(60 |
) |
bps |
|
|
|
|
|
|
|
|
|
|
Other expense
(GAAP) |
$ |
15.8 |
|
|
$ |
22.7 |
|
|
|
|
|
|
Add-back: Gain on sale
of investment in unconsolidated affiliate |
|
7.2 |
|
|
|
- |
|
|
|
|
|
|
Adjusted other expense
(Non-GAAP) |
$ |
23.0 |
|
|
$ |
22.7 |
|
|
$ |
0.3 |
|
|
1.3 |
% |
|
|
|
|
|
|
|
|
|
|
Net Income (GAAP) |
$ |
231.2 |
|
|
$ |
207.9 |
|
|
|
|
|
|
Add-back:
Amortization of acquired intangible assets |
|
21.9 |
|
|
|
18.5 |
|
|
|
|
|
|
Add-back:Share-based payment expense |
|
24.1 |
|
|
|
19.9 |
|
|
|
|
|
|
Add-back:
Acquisition-related items(1) |
|
- |
|
|
|
10.4 |
|
|
|
|
|
|
Add-back:
Manufacturing Inefficiencies(2) |
|
1.6 |
|
|
|
- |
|
|
|
|
|
|
Add-back:
Special charge |
|
1.7 |
|
|
|
10.2 |
|
|
|
|
|
|
Less:
Gain on sale of investment in unconsolidated affiliate |
|
(7.2 |
) |
|
|
- |
|
|
|
|
|
|
Total
pre-tax adjustments to Net Income |
|
42.1 |
|
|
|
59.0 |
|
|
|
|
|
|
Income
tax effect |
|
(14.7 |
) |
|
|
(20.4 |
) |
|
|
|
|
|
Adjusted
Net Income (Non-GAAP) |
$ |
258.6 |
|
|
$ |
246.5 |
|
|
$ |
12.1 |
|
|
4.9 |
% |
|
|
|
|
|
|
|
|
|
|
Diluted Earnings per
Share (GAAP) |
$ |
5.29 |
|
|
$ |
4.75 |
|
|
|
|
|
|
Adjusted Diluted
Earnings per Share (Non-GAAP) |
$ |
5.92 |
|
|
$ |
5.63 |
|
|
$ |
0.29 |
|
|
5.2 |
% |
|
|
(1) Acquisiton-related items include acquired profit in
inventory, professional fees, and certain contract termination
costs. |
|
|
|
|
|
(2) Incremental costs incurred due to manufacturing
inefficiencies directly related to the closure of a facility. |
|
|
|
|
|
Contact:
Dan Smith, 404-853-1423
dan.smith@acuitybrands.com
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