DMC Global Inc. (Nasdaq: BOOM) today reported financial results for
its first quarter ended March 31, 2021.
First quarter sales were $55.7 million, down 3%
sequentially versus last year’s fourth quarter, and down 24% versus
the first quarter of 2020. This year’s first quarter sales were
negatively affected by continued weak energy demand associated with
the Covid-19 pandemic, as well as a severe winter storm in Texas,
both of which reduced sales at DynaEnergetics, DMC’s energy
products business. Sales at NobelClad, DMC’s composite metals
business, were negatively affected by $1.7 million in shipment
delays resulting from widespread logistical bottlenecks in Europe
and later-than-expected clad-plate inspections by a customer in the
United States.
First quarter gross margin was 23% versus 21% in
the 2020 fourth quarter and 33% in last year’s first quarter. Gross
margin was impacted by a more favorable project mix at NobelClad,
which partially was offset by one-time costs associated with a
weather-related production shutdown at DynaEnergetics’ Blum, Texas
facility.
First quarter operating loss was $710,000 versus
operating income of $6.3 million in last year's first quarter. Net
income was $432,000, or $0.03 per diluted share, versus net income
of $4.2 million, or $0.28 per diluted share, in last year’s first
quarter. Adjusted net income was $559,000, or $0.04 per diluted
share.
First quarter adjusted EBITDA was $4.0 million
versus $3.6 million in the 2020 fourth quarter, and $11.3 million
in the 2020 first quarter.
In February, DMC repaid in full the outstanding
$11.8 million balance on its term loan, and ended the first quarter
with cash and marketable securities of $66.8 million, up from net
cash* of $42.6 million at December 31, 2020. During the quarter,
the Company raised net proceeds of $25.3 million through its
at-the-market equity program.
DynaEnergetics First quarter sales at
DynaEnergetics were $38.2 million, up 8% sequentially and down 28%
from the 2020 first quarter. Gross margin was 22%, down from 24% in
the fourth quarter of 2020 and 37% in last year’s first quarter.
Adjusted EBITDA was $3.5 million versus $11.3 million in last
year’s first quarter.
NobelClad First quarter sales at NobelClad were
$17.5 million, down 20% sequentially and down 14% versus the 2020
first quarter. Gross margin was 26%, up from 18% in the 2020 fourth
quarter and 25% in last year's first quarter. The gross margin
improvement reflects a more favorable project mix. Adjusted EBITDA
was $2.7 million, up from $2.4 million in last year’s first
quarter.
NobelClad’s trailing 12-month book-to-bill ratio
at the end of the first quarter was 1.01, and its rolling 12-month
bookings were $81 million. Order backlog was $43.2 million versus
$39.9 million at the end of the fourth quarter.
Management Commentary “The
financial and operational strength of DMC continued to improve
during the first quarter,” said Kevin Longe, president and CEO. “We
closed the quarter with approximately $67 million in cash and
marketable securities, zero long-term debt and the strongest
financial position in Company history.
“Solid execution by the team at DynaEnergetics
led to sales that were within our forecasted range, despite a
nearly two-week weather-related sales disruption across our largest
regional market. There is growing demand for our family of DS
Factory-Assembled, Performance-Assured™ perforating systems; and as
well-completion activity accelerates and the pricing environment
continues to improve, we believe DynaEnergetics is well positioned
to achieve meaningful sales growth and margin improvement beginning
in the second quarter.
“DMC continues to foster an environment of
creativity and innovation. At DynaEnergetics, our substantial
investments in new technologies have resulted in a robust product
portfolio that has improved the safety, efficiency and
effectiveness of our customers’ operations; and has led to
increased productivity, profitability and job creation in our
industry. The significance of our investments is reflected in the
76 patents we have been granted and the more than 400 patent
applications we have filed. Our patent strategy is designed to
protect our investments and provide transparency so others can
innovate without violating our intellectual property. Despite this,
a number of competitors have commercialized products that we
believe infringe on DynaEnergetics’ patents. During the first
quarter, we took legal action against several of these companies,
spending approximately $1 million on patent litigation. We intend
to continue these expenditures until the issues are resolved. Our
commitment of resources to this process reflects our belief that if
intellectual property is not protected, the incentive to innovate
is lost and the sustainability of the industry is threatened.”
Longe continued, “NobelClad closed the quarter
with a $43 million order backlog, and the business is making
significant progress on a variety of application and
product-development initiatives. Despite recent shipping delays, we
remain encouraged by the medium to long-term growth prospects at
NobelClad.”
“I am pleased with the continued progress of our
businesses and by the improving outlook within our end markets,”
Longe added. “DMC’s strong prospects for long-term growth are made
possible by the skill and determination of our employees, and I’m
extremely appreciative of their continued efforts and commitment to
the Company.”
GuidanceMichael Kuta, CFO, said
second quarter 2021 sales are expected to be in a range of $67
million to $72 million versus the $55.7 million reported in the
2021 first quarter. At the business level, DynaEnergetics is
expected to report sales in a range of $44 million to $47 million
versus the $38.2 million reported in the 2021 first quarter, while
NobelClad’s sales are expected in a range of $23 million to $25
million versus the $17.5 million reported in the 2021 first
quarter.
Consolidated gross margin is expected in a range
of 25% to 26% versus 23% in the 2021 first quarter. Second quarter
selling, general and administrative (SG&A) expense is expected
to be in a range of $14 million to $15 million versus the $13.2
million reported in the 2021 first quarter, and reflects an
anticipated $1.5 million in litigation expense at DynaEnergetics,
continued investments in digital transformation, the resumption of
business-related travel, and the restoration of variable
compensation. Amortization expense is expected to be approximately
$300,000, and interest expense is expected to be approximately
$90,000.
Adjusted EBITDA is expected in a range of $6
million to $8 million versus the $4.0 million in the first quarter
of 2021.
Second quarter capital expenditures are expected
in a range of $2 million to $4 million.
Conference call
informationManagement will hold a conference call to
discuss these results today at 5:00 p.m. Eastern (3:00 p.m.
Mountain). The call is available live via the Internet at:
https://www.webcaster4.com/Webcast/Page/2204/40777, or by dialing
888-506-0062 (973-528-0011 for international callers) and entering
the code 329873. Webcast participants should access the website at
least 15 minutes early to register and download any necessary audio
software. A replay of the webcast will be available for 90 days and
a telephonic replay will be available until April 29, 2021, by
calling 877-481-4010 (919-882-2331 for international callers) and
entering the Conference ID #40777.
*Use of Non-GAAP Financial
MeasuresAdjusted EBITDA, adjusted operating income (loss),
adjusted net income (loss), and net cash are non-GAAP (generally
accepted accounting principles) financial measures used by
management to measure operating performance and liquidity. Non-GAAP
results are presented only as a supplement to the financial
statements based on U.S. generally accepted accounting principles
(GAAP). The non-GAAP financial information is provided to enhance
the reader’s understanding of DMC’s financial performance, but no
non-GAAP measure should be considered in isolation or as a
substitute for financial measures calculated in accordance with
GAAP. Reconciliations of the most directly comparable GAAP measures
to non-GAAP measures are provided within the schedules attached to
this release.
EBITDA is defined as net income plus or minus
net interest plus taxes, depreciation and amortization. Adjusted
EBITDA excludes from EBITDA stock-based compensation, restructuring
and impairment charges and, when appropriate, other items that
management does not utilize in assessing DMC’s operating
performance (as further described in the attached financial
schedules). Adjusted operating income (loss) is defined as
operating income (loss) plus restructuring and impairment charges
and, when appropriate, other items that management does not utilize
in assessing DMC’s operating performance. Adjusted net income
(loss) is defined as net income plus restructuring and impairment
charges and, when appropriate, other items that management does not
utilize in assessing DMC’s operating performance. Net cash is
defined as cash and cash equivalents less total debt. None of these
non-GAAP financial measures are recognized terms under GAAP and do
not purport to be an alternative to net income as an indicator of
operating performance or any other GAAP measure.
Management uses adjusted EBITDA in its
operational and financial decision-making, believing that it is
useful to eliminate certain items in order to focus on what it
deems to be a more reliable indicator of ongoing operating
performance. As a result, internal management reports used during
monthly operating reviews feature adjusted EBITDA measures.
Management believes that investors may find this non-GAAP financial
measure useful for similar reasons, although investors are
cautioned that non-GAAP financial measures are not a substitute for
GAAP disclosures. In addition, management incentive awards are
based, in part, on the amount of adjusted EBITDA achieved during
relevant periods. EBITDA and adjusted EBITDA are also used by
research analysts, investment bankers and lenders to assess
operating performance. For example, a measure similar to adjusted
EBITDA is required by the lenders under DMC’s credit facility.
Net cash is used by management to supplement
GAAP financial information and evaluate DMC’s performance, and
management believes this information may be similarly useful to
investors. Adjusted operating income (loss) and adjusted net income
(loss) are presented because management believes these measures are
useful to understand the effects of restructuring and impairment
charges on DMC’s operating income (loss) and net income (loss),
respectively.
Because not all companies use identical
calculations, DMC’s presentation of non-GAAP financial measures may
not be comparable to other similarly titled measures of other
companies. However, these measures can still be useful in
evaluating the company’s performance against its peer companies
because management believes the measures provide users with
valuable insight into key components of GAAP financial disclosures.
For example, a company with greater GAAP net income may not be as
appealing to investors if its net income is more heavily comprised
of gains on asset sales. Likewise, eliminating the effects of
interest income and expense moderates the impact of a company’s
capital structure on its performance.
All of the items included in the reconciliation
from net income to EBITDA and adjusted EBITDA are either (i)
non-cash items (e.g., depreciation, amortization of purchased
intangibles and stock-based compensation) or (ii) items that
management does not consider to be useful in assessing DMC’s
operating performance (e.g., income taxes, restructuring and
impairment charges). In the case of the non-cash items, management
believes that investors can better assess the company’s operating
performance if the measures are presented without such items
because, unlike cash expenses, these adjustments do not affect
DMC’s ability to generate free cash flow or invest in its business.
For example, by adjusting for depreciation and amortization in
computing EBITDA, users can compare operating performance without
regard to different accounting determinations such as useful life.
In the case of the other items, management believes that investors
can better assess operating performance if the measures are
presented without these items because their financial impact does
not reflect ongoing operating performance.
About DMCDMC Global is a
diversified holding company. Our innovative businesses provide
differentiated products and services to niche industrial and
commercial markets around the world. DMC’s objective is to identify
well-run businesses and strong management teams and support them
with long-term capital and strategic, legal, technology and
operating resources. Our approach helps our portfolio companies
grow core businesses, launch new initiatives, upgrade technologies
and systems to support their long-term strategy, and make
acquisitions that improve their competitive positions and expand
their markets. DMC’s culture is to foster local innovation versus
centralized control, and stand behind our businesses in ways that
truly add value. Today, DMC’s portfolio consists of DynaEnergetics
and NobelClad, which collectively address the energy, industrial
processing and transportation markets. Based in Broomfield,
Colorado, DMC trades on Nasdaq under the symbol “BOOM.” For more
information, visit the Company’s website at:
http://www.dmcglobal.com
Safe Harbor Language 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, including
second quarter guidance on sales, gross margin, SG&A,
amortization expense, interest expense, adjusted EBITDA and
capital expenditures, our belief that DynaEnergetics is well
positioned to achieve meaningful sales growth and margin
improvement beginning in the second quarter, our belief that the
outlook is improving within our end markets, our confidence in the
long-term growth prospects at NobelClad and DMC’s strong prospects
for long-term growth and our expectations regarding future
litigation expenditures. Statements other than statements of
historical fact included in this press release are forward-looking
statements. Forward-looking statements are based on numerous
assumptions regarding present and future business strategies, the
markets in which we operate, anticipated costs, ability to achieve
goals and numerous other factors. Forward-looking information and
statements are subject to known and unknown risks, uncertainties
and other important factors that may cause actual results and
performance to be materially different from those expressed or
implied by such forward-looking information and statements,
including but not limited to: our ability to realize sales from our
backlog; our ability to obtain new contracts at attractive prices;
the execution of purchase commitments by our customers, and our
ability to successfully deliver on those purchase commitments; the
size and timing of customer orders and shipments; changes to
customer orders; product pricing and margins; our ability to
collect on our accounts receivable; fluctuations in customer
demand; our ability to successfully execute and capitalize upon
growth opportunities; the success of DynaEnergetics’ product and
technology development initiatives; fluctuations in foreign
currencies; fluctuations in tariffs and quotas; the cyclicality of
our business; competitive factors; the timely completion of
contracts; the timing and size of expenditures; the timing and
price of metal and other raw materials; the adequacy of local labor
supplies at our facilities; current or future limits on
manufacturing capacity at our various operations; the availability
and cost of funds; the progress and results of pending litigation;
our ability to access our borrowing capacity under our credit
facility; impacts of COVID-19 and any related preventive or
protective actions taken by governmental authorities and resulting
economic impacts, including recessions or depressions; and general
economic conditions, both domestic and foreign, impacting our
business and the business of the end-market users we serve; as well
as the other risks detailed from time to time in our SEC reports,
including the annual report on Form 10-K for the year ended
December 31, 2020. We do not undertake any obligation to release
public revisions to any forward-looking statement, including,
without limitation, to reflect events or circumstances after the
date of this news release, or to reflect the occurrence of
unanticipated events, except as may be required under applicable
securities laws.
DMC GLOBAL INC.CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS(Amounts in Thousands, Except Share and Per Share
Data)(unaudited)
|
Three months ended |
|
Change |
|
Mar 31, 2021 |
|
Dec 31, 2020 |
|
Mar 31, 2020 |
|
Sequential |
|
Year-on-year |
NET SALES |
$ |
55,658 |
|
|
|
$ |
57,113 |
|
|
|
$ |
73,564 |
|
|
|
-3 |
% |
|
-24 |
% |
COST OF PRODUCTS SOLD |
42,745 |
|
|
|
44,927 |
|
|
|
49,094 |
|
|
|
-5 |
% |
|
-13 |
% |
Gross profit |
12,913 |
|
|
|
12,186 |
|
|
|
24,470 |
|
|
|
6 |
% |
|
-47 |
% |
Gross profit percentage |
23 |
|
% |
|
21 |
|
% |
|
33 |
|
% |
|
|
|
|
COSTS AND EXPENSES: |
|
|
|
|
|
|
|
|
|
General and administrative expenses |
7,929 |
|
|
|
7,406 |
|
|
|
8,126 |
|
|
|
7 |
% |
|
-2 |
% |
Selling and distribution expenses |
5,243 |
|
|
|
5,143 |
|
|
|
8,527 |
|
|
|
2 |
% |
|
-39 |
% |
Amortization of purchased intangible assets |
324 |
|
|
|
373 |
|
|
|
354 |
|
|
|
-13 |
% |
|
-8 |
% |
Restructuring expenses |
127 |
|
|
|
82 |
|
|
|
1,116 |
|
|
|
55 |
% |
|
-89 |
% |
Total costs and expenses |
13,623 |
|
|
|
13,004 |
|
|
|
18,123 |
|
|
|
5 |
% |
|
-25 |
% |
OPERATING (LOSS) INCOME |
(710 |
) |
|
|
(818 |
) |
|
|
6,347 |
|
|
|
13 |
% |
|
-111 |
% |
OTHER INCOME (EXPENSE) : |
|
|
|
|
|
|
|
|
|
Other income (expense), net |
394 |
|
|
|
(115 |
) |
|
|
115 |
|
|
|
443 |
% |
|
243 |
% |
Interest expense, net |
(135 |
) |
|
|
(167 |
) |
|
|
(238 |
) |
|
|
19 |
% |
|
43 |
% |
(LOSS) INCOME BEFORE INCOME
TAXES |
(451 |
) |
|
|
(1,100 |
) |
|
|
6,224 |
|
|
|
59 |
% |
|
-107 |
% |
INCOME TAX (BENEFIT)
PROVISION |
(883 |
) |
|
|
(173 |
) |
|
|
2,069 |
|
|
|
-410 |
% |
|
-143 |
% |
NET INCOME (LOSS) |
432 |
|
|
|
(927 |
) |
|
|
4,155 |
|
|
|
147 |
% |
|
-90 |
% |
NET INCOME (LOSS) PER
SHARE |
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.03 |
|
|
|
$ |
(0.06 |
) |
|
|
$ |
0.28 |
|
|
|
150 |
% |
|
-89 |
% |
Diluted |
$ |
0.03 |
|
|
|
$ |
(0.06 |
) |
|
|
$ |
0.28 |
|
|
|
150 |
% |
|
-89 |
% |
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING: |
|
|
|
|
|
|
|
|
|
Basic |
15,453,103 |
|
|
|
14,917,109 |
|
|
|
14,697,164 |
|
|
|
4 |
% |
|
5 |
% |
Diluted |
15,463,923 |
|
|
|
14,917,109 |
|
|
|
14,717,836 |
|
|
|
4 |
% |
|
5 |
% |
DIVIDENDS DECLARED PER COMMON
SHARE |
$ |
— |
|
|
|
$ |
— |
|
|
|
$ |
0.125 |
|
|
|
|
|
|
DMC GLOBAL INC.SEGMENT STATEMENTS OF
OPERATIONS(Amounts in Thousands)(unaudited)
DynaEnergetics
|
Three months ended |
|
Change |
|
Mar 31, 2021 |
|
Dec 31, 2020 |
|
Mar 31, 2020 |
|
Sequential |
|
Year-on-year |
Net sales |
$ |
38,172 |
|
|
$ |
35,330 |
|
|
$ |
53,220 |
|
|
8 |
% |
|
-28 |
% |
Gross profit |
8,434 |
|
|
8,433 |
|
|
19,476 |
|
|
— |
% |
|
-57 |
% |
Gross profit percentage |
22 |
% |
|
24 |
% |
|
37 |
% |
|
|
|
|
COSTS AND EXPENSES: |
|
|
|
|
|
|
|
|
|
General and administrative expenses |
3,574 |
|
|
2,952 |
|
|
3,832 |
|
|
21 |
% |
|
-7 |
% |
Selling and distribution expenses |
3,140 |
|
|
2,945 |
|
|
5,840 |
|
|
7 |
% |
|
-46 |
% |
Amortization of purchased intangible assets |
199 |
|
|
271 |
|
|
260 |
|
|
-27 |
% |
|
-23 |
% |
Restructuring expenses |
— |
|
|
— |
|
|
938 |
|
|
n/a |
|
-100 |
% |
Operating income |
1,521 |
|
|
2,265 |
|
|
8,606 |
|
|
-33 |
% |
|
-82 |
% |
Adjusted EBITDA |
$ |
3,521 |
|
|
$ |
4,118 |
|
|
$ |
11,316 |
|
|
-14 |
% |
|
-69 |
% |
NobelClad
|
Three months ended |
|
Change |
|
Mar 31, 2021 |
|
Dec 31, 2020 |
|
Mar 31, 2020 |
|
Sequential |
|
Year-on-year |
Net sales |
$ |
17,486 |
|
|
$ |
21,783 |
|
|
$ |
20,344 |
|
|
-20 |
% |
|
-14 |
% |
Gross profit |
4,617 |
|
|
3,902 |
|
|
5,154 |
|
|
18 |
% |
|
-10 |
% |
Gross profit percentage |
26 |
% |
|
18 |
% |
|
25 |
% |
|
|
|
|
COSTS AND EXPENSES: |
|
|
|
|
|
|
|
|
|
General and administrative expenses |
813 |
|
|
739 |
|
|
974 |
|
|
10 |
% |
|
-17 |
% |
Selling and distribution expenses |
1,948 |
|
|
2,036 |
|
|
2,551 |
|
|
-4 |
% |
|
-24 |
% |
Amortization of purchased intangible assets |
125 |
|
|
102 |
|
|
94 |
|
|
23 |
% |
|
33 |
% |
Restructuring expenses |
127 |
|
|
82 |
|
|
59 |
|
|
55 |
% |
|
115 |
% |
Operating income |
1,604 |
|
|
943 |
|
|
1,476 |
|
|
70 |
% |
|
9 |
% |
Adjusted EBITDA |
$ |
2,670 |
|
|
$ |
1,935 |
|
|
$ |
2,369 |
|
|
38 |
% |
|
13 |
% |
DMC GLOBAL INC.CONDENSED CONSOLIDATED BALANCE
SHEETS(Amounts in Thousands)
|
|
|
|
|
Change |
|
Mar 31, 2021 |
|
Dec 31, 2020 |
|
From year-end |
|
(unaudited) |
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
45,837 |
|
|
$ |
28,187 |
|
|
63 |
% |
Marketable securities |
20,943 |
|
|
25,736 |
|
|
-19 |
% |
Accounts receivable, net |
35,609 |
|
|
31,366 |
|
|
14 |
% |
Inventories |
57,944 |
|
|
52,573 |
|
|
10 |
% |
Other current assets |
7,855 |
|
|
5,448 |
|
|
44 |
% |
|
|
|
|
|
|
Total current assets |
168,188 |
|
|
143,310 |
|
|
17 |
% |
|
|
|
|
|
|
Property, plant and equipment,
net |
106,800 |
|
|
109,411 |
|
|
-2 |
% |
Purchased intangible assets,
net |
2,927 |
|
|
3,665 |
|
|
-20 |
% |
Other long-term assets |
26,902 |
|
|
23,259 |
|
|
16 |
% |
|
|
|
|
|
|
Total assets |
$ |
304,817 |
|
|
$ |
279,645 |
|
|
9 |
% |
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
|
Accounts payable |
$ |
27,336 |
|
|
$ |
17,574 |
|
|
56 |
% |
Contract liabilities |
7,205 |
|
|
4,928 |
|
|
46 |
% |
Accrued income taxes |
7,975 |
|
|
7,279 |
|
|
10 |
% |
Current portion of long-term
debt |
— |
|
|
3,125 |
|
|
-100 |
% |
Other current liabilities |
15,857 |
|
|
14,202 |
|
|
12 |
% |
|
|
|
|
|
|
Total current liabilities |
58,373 |
|
|
47,108 |
|
|
24 |
% |
|
|
|
|
|
|
Long-term debt |
— |
|
|
8,139 |
|
|
-100 |
% |
Deferred tax liabilities |
1,211 |
|
|
2,254 |
|
|
-46 |
% |
Other long-term
liabilities |
26,803 |
|
|
25,230 |
|
|
6 |
% |
Stockholders’ equity |
218,430 |
|
|
196,914 |
|
|
11 |
% |
|
|
|
|
|
|
Total liabilities and
stockholders’ equity |
$ |
304,817 |
|
|
$ |
279,645 |
|
|
9 |
% |
DMC GLOBAL INC.CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS(Amounts in Thousands)(unaudited)
|
Three months ended |
|
Mar 31, 2021 |
|
Dec 31, 2020 |
|
Mar 31, 2020 |
CASH FLOWS FROM OPERATING
ACTIVITIES: |
|
|
|
|
|
Net income (loss) |
$ |
432 |
|
|
$ |
(927 |
) |
|
$ |
4,155 |
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities: |
|
|
|
|
|
Depreciation |
2,698 |
|
|
2,465 |
|
|
2,352 |
|
Amortization of purchased intangible assets |
324 |
|
|
373 |
|
|
354 |
|
Amortization of deferred debt issuance costs |
56 |
|
|
53 |
|
|
40 |
|
Stock-based compensation |
1,608 |
|
|
1,521 |
|
|
1,118 |
|
Deferred income taxes |
(2,334 |
) |
|
(1,474 |
) |
|
(160 |
) |
(Gain) loss on disposal of property, plant and equipment |
(288 |
) |
|
134 |
|
|
13 |
|
Restructuring expenses |
127 |
|
|
82 |
|
|
1,116 |
|
Change in working capital, net |
(447 |
) |
|
6,781 |
|
|
(4,068 |
) |
Net cash provided by operating activities |
2,176 |
|
|
9,008 |
|
|
4,920 |
|
CASH FLOWS FROM INVESTING
ACTIVITIES: |
|
|
|
|
|
Investment in marketable securities |
— |
|
|
(25,740 |
) |
|
— |
|
Proceeds from maturities of marketable securities |
4,799 |
|
|
— |
|
|
— |
|
Acquisition of property, plant and equipment |
(1,365 |
) |
|
(4,171 |
) |
|
(5,121 |
) |
Proceeds on sale of property, plant and equipment |
281 |
|
|
16 |
|
|
— |
|
Net cash used in investing activities |
3,715 |
|
|
(29,895 |
) |
|
(5,121 |
) |
CASH FLOWS FROM FINANCING
ACTIVITIES: |
|
|
|
|
|
Repayments on capital expenditure facility |
(11,750 |
) |
|
(781 |
) |
|
(781 |
) |
Payment of dividends |
— |
|
|
— |
|
|
(1,866 |
) |
Payment of deferred debt issuance costs |
— |
|
|
(2 |
) |
|
— |
|
Net proceeds from issuance of common stock through at-the-market
offering program |
25,262 |
|
|
25,740 |
|
|
— |
|
Net proceeds from issuance of common stock |
— |
|
|
165 |
|
|
— |
|
Treasury stock purchases |
(2,435 |
) |
|
(767 |
) |
|
(1,034 |
) |
Net cash used in financing activities |
11,077 |
|
|
24,355 |
|
|
(3,681 |
) |
EFFECTS OF EXCHANGE RATES ON
CASH |
682 |
|
|
115 |
|
|
(20 |
) |
|
|
|
|
|
|
NET INCREASE (DECREASE) IN
CASH AND CASH EQUIVALENTS |
17,650 |
|
|
3,583 |
|
|
(3,902 |
) |
CASH AND CASH EQUIVALENTS,
beginning of the period |
28,187 |
|
|
24,604 |
|
|
20,353 |
|
CASH AND CASH EQUIVALENTS, end
of the period |
$ |
45,837 |
|
|
$ |
28,187 |
|
|
$ |
16,451 |
|
DMC GLOBAL INC.RECONCILIATIONS OF NON-GAAP
FINANCIAL MEASUREMENTS TO MOSTDIRECTLY COMPARABLE GAAP FINANCIAL
MEASUREMENTS(Amounts in Thousands)(unaudited)
DMC Global
EBITDA and Adjusted EBITDA
|
Three months ended |
|
Change |
|
Mar 31, 2021 |
|
Dec 31, 2020 |
|
Mar 31, 2020 |
|
Sequential |
|
Year-on-year |
Net income (loss) |
$ |
432 |
|
|
$ |
(927 |
) |
|
$ |
4,155 |
|
|
147 |
% |
|
-90 |
% |
Interest expense, net |
135 |
|
|
167 |
|
|
238 |
|
|
-19 |
% |
|
-43 |
% |
Income tax (benefit)
provision |
(883 |
) |
|
(173 |
) |
|
2,069 |
|
|
-410 |
% |
|
-143 |
% |
Depreciation |
2,698 |
|
|
2,465 |
|
|
2,352 |
|
|
9 |
% |
|
15 |
% |
Amortization of purchased
intangible assets |
324 |
|
|
373 |
|
|
354 |
|
|
-13 |
% |
|
-8 |
% |
|
|
|
|
|
|
|
|
|
|
EBITDA |
2,706 |
|
|
1,905 |
|
|
9,168 |
|
|
42 |
% |
|
-70 |
% |
Restructuring expenses |
127 |
|
|
82 |
|
|
1,116 |
|
|
55 |
% |
|
-89 |
% |
Stock-based compensation |
1,608 |
|
|
1,521 |
|
|
1,118 |
|
|
6 |
% |
|
44 |
% |
Other (income) expense,
net |
(394 |
) |
|
115 |
|
|
(115 |
) |
|
-443 |
% |
|
-243 |
% |
Adjusted EBITDA |
$ |
4,047 |
|
|
$ |
3,623 |
|
|
$ |
11,287 |
|
|
12 |
% |
|
-64 |
% |
Adjusted operating income
|
Three months ended |
|
Change |
|
Mar 31, 2021 |
|
Dec 31, 2020 |
|
Mar 31, 2020 |
|
Sequential |
|
Year-on-year |
Operating (loss) income, as reported |
$ |
(710 |
) |
|
$ |
(818 |
) |
|
$ |
6,347 |
|
|
13 |
% |
|
-111 |
% |
Restructuring expenses: |
|
|
|
|
|
|
|
|
|
DynaEnergetics |
— |
|
|
— |
|
|
938 |
|
|
n/a |
|
-100 |
% |
NobelClad |
127 |
|
|
82 |
|
|
59 |
|
|
55 |
% |
|
115 |
% |
Corporate |
— |
|
|
— |
|
|
119 |
|
|
n/a |
|
-100 |
% |
Adjusted operating (loss)
income |
$ |
(583 |
) |
|
$ |
(736 |
) |
|
$ |
7,463 |
|
|
21 |
% |
|
-108 |
% |
Adjusted Net Income and Adjusted Diluted Earnings per Share
|
Three months ended March 31, 2021 |
|
Pretax |
|
Tax Benefit |
|
Net |
|
Diluted weighted average shares outstanding |
|
Diluted EPS |
Net income, as reported |
$ |
(451 |
) |
|
$ |
(883 |
) |
|
$ |
432 |
|
|
15,463,923 |
|
|
$ |
0.03 |
|
Restructuring programs: |
|
|
|
|
|
|
|
|
|
NobelClad |
127 |
|
|
— |
|
|
127 |
|
|
15,463,923 |
|
|
0.01 |
|
Adjusted net income |
$ |
(324 |
) |
|
$ |
(883 |
) |
|
$ |
559 |
|
|
15,463,923 |
|
|
$ |
0.04 |
|
|
Three months ended December 31, 2020 |
|
Pretax |
|
Tax Benefit |
|
Net |
|
Diluted weighted average shares outstanding |
|
Diluted EPS |
Net loss, as reported |
$ |
(1,100 |
) |
|
$ |
(173 |
) |
|
$ |
(927 |
) |
|
14,917,109 |
|
|
$ |
(0.06 |
) |
Restructuring expenses: |
|
|
|
|
|
|
|
|
|
NobelClad |
82 |
|
|
(20 |
) |
|
102 |
|
|
14,917,109 |
|
|
0.01 |
|
Adjusted net loss |
$ |
(1,018 |
) |
|
$ |
(193 |
) |
|
$ |
(825 |
) |
|
14,917,109 |
|
|
$ |
(0.05 |
) |
|
Three months ended March 31, 2020 |
|
Pretax |
|
Tax Provision |
|
Net |
|
Diluted weighted average shares outstanding |
|
Diluted EPS |
Net income, as reported |
$ |
6,224 |
|
|
$ |
2,069 |
|
|
$ |
4,155 |
|
|
14,717,836 |
|
|
$ |
0.28 |
|
Restructuring expenses: |
|
|
|
|
|
|
|
|
|
DynaEnergetics |
938 |
|
|
— |
|
|
938 |
|
|
14,717,836 |
|
|
0.06 |
|
NobelClad |
59 |
|
|
— |
|
|
59 |
|
|
14,717,836 |
|
|
— |
|
Corporate |
119 |
|
|
— |
|
|
119 |
|
|
14,717,836 |
|
|
0.01 |
|
Adjusted net income |
$ |
7,340 |
|
|
$ |
2,069 |
|
|
$ |
5,271 |
|
|
14,717,836 |
|
|
$ |
0.35 |
|
Return on Invested Capital
|
|
|
Three months ended |
|
|
|
Mar 31, 2020 |
|
Jun 30, 2020 |
|
Sep 30, 2020 |
|
Dec 31, 2020 |
|
Mar 31, 2021 |
Operating income (loss) |
|
6,347 |
|
|
$ |
(7,990 |
) |
|
$ |
1,465 |
|
|
$ |
(818 |
) |
|
|
$ |
(710 |
) |
|
Income tax
provision (benefit) (1) |
|
2,107 |
|
|
(2,509 |
) |
|
177 |
|
|
(54 |
) |
|
|
(1,390 |
) |
|
Net operating
profit (loss) after taxes (NOPAT) |
|
4,240 |
|
|
(5,481 |
) |
|
1,288 |
|
|
(764 |
) |
|
|
680 |
|
|
Trailing Twelve
Months NOPAT |
|
|
|
|
|
|
|
(717 |
) |
|
|
(4,277 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balances as of |
|
Dec 31, 2019 |
|
Mar 31, 2020 |
|
Jun 30, 2020 |
|
Sep 30, 2020 |
|
Dec 31, 2020 |
|
Mar 31, 2021 |
Current portion of lease
liabilities |
1,716 |
|
|
1,618 |
|
|
1,846 |
|
|
1,804 |
|
|
1,741 |
|
|
|
1,505 |
|
|
Long-term portion of lease
liabilities |
9,777 |
|
|
9,454 |
|
|
10,430 |
|
|
10,155 |
|
|
10,066 |
|
|
|
10,137 |
|
|
Current portion of long-term
debt |
3,125 |
|
|
3,125 |
|
|
3,125 |
|
|
3,125 |
|
|
3,125 |
|
|
|
— |
|
|
Long-term debt |
11,147 |
|
|
10,406 |
|
|
9,595 |
|
|
8,867 |
|
|
8,139 |
|
|
|
— |
|
|
Total stockholders'
equity |
172,141 |
|
|
173,689 |
|
|
170,283 |
|
|
169,951 |
|
|
196,914 |
|
|
|
218,430 |
|
|
Total invested capital |
197,906 |
|
|
198,292 |
|
|
195,279 |
|
|
193,902 |
|
|
219,985 |
|
|
|
230,072 |
|
|
Average invested capital |
|
|
|
|
|
|
|
|
208,946 |
|
|
|
214,182 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trailing Twelve
Months Return on Invested Capital (ROIC) |
|
|
|
|
|
— |
|
% |
|
(2 |
) |
% |
(1) Tax calculation for
NOPAT: |
|
|
|
|
|
|
Three months ended |
|
Twelve months ended |
|
Three months ended |
|
Mar 31, 2020 |
|
Jun 30, 2020 |
|
Sep 30, 2020 |
|
Dec 31, 2020 |
|
Dec 31, 2020 |
|
Mar 31, 2021 |
Income (loss) before income taxes |
6,224 |
|
|
(8,231 |
) |
|
|
1,147 |
|
|
(1,100 |
) |
|
|
(1,960 |
) |
|
|
(451 |
) |
|
Income tax provision
(benefit) |
2,069 |
|
|
(2,583 |
) |
|
|
139 |
|
|
(173 |
) |
|
|
(548 |
) |
|
|
(883 |
) |
|
Effective tax rate |
33.2 |
% |
|
31.4 |
|
% |
|
12.1 |
% |
|
15.7 |
|
% |
|
28.0 |
|
% |
|
195.8 |
|
% |
DynaEnergetics
|
Three months ended |
|
Change |
|
Mar 31, 2021 |
|
Dec 31, 2020 |
|
Mar 31, 2020 |
|
Sequential |
|
Year-on-year |
Operating income, as reported |
$ |
1,521 |
|
|
$ |
2,265 |
|
|
$ |
8,606 |
|
|
-33 |
% |
|
-82 |
% |
Adjustments: |
|
|
|
|
|
|
|
|
|
Restructuring expenses |
— |
|
|
— |
|
|
938 |
|
|
n/a |
|
-100 |
% |
|
|
|
|
|
|
|
|
|
|
Adjusted operating income |
1,521 |
|
|
2,265 |
|
|
9,544 |
|
|
-33 |
% |
|
-84 |
% |
Depreciation |
1,801 |
|
|
1,582 |
|
|
1,512 |
|
|
14 |
% |
|
19 |
% |
Amortization of purchased intangibles |
199 |
|
|
271 |
|
|
260 |
|
|
-27 |
% |
|
-23 |
% |
Adjusted EBITDA |
$ |
3,521 |
|
|
$ |
4,118 |
|
|
$ |
11,316 |
|
|
-14 |
% |
|
-69 |
% |
NobelClad
|
Three months ended |
|
Change |
|
Mar 31, 2021 |
|
Dec 31, 2020 |
|
Mar 31, 2020 |
|
Sequential |
|
Year-on-year |
Operating income, as reported |
$ |
1,604 |
|
|
$ |
943 |
|
|
$ |
1,476 |
|
|
70 |
% |
|
9 |
% |
Adjustments: |
|
|
|
|
|
|
|
|
|
Restructuring expenses |
127 |
|
|
82 |
|
|
59 |
|
|
55 |
% |
|
115 |
% |
|
|
|
|
|
|
|
|
|
|
Adjusted operating income |
1,731 |
|
|
1,025 |
|
|
1,535 |
|
|
|
|
|
Depreciation |
814 |
|
|
808 |
|
|
740 |
|
|
1 |
% |
|
10 |
% |
Amortization of purchased intangibles |
125 |
|
|
102 |
|
|
94 |
|
|
23 |
% |
|
33 |
% |
Adjusted EBITDA |
$ |
2,670 |
|
|
$ |
1,935 |
|
|
$ |
2,369 |
|
|
38 |
% |
|
13 |
% |
CONTACT: |
Geoff High, Vice President of Investor Relations |
303-604-3924 |
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