Black Box Corporation (NASDAQ:BBOX), a leading technology solutions
provider dedicated to helping customers design, build, manage, and
secure their IT infrastructure, today reported results for the fourth
quarter of Fiscal 2015 and twelve-month period ended March 31, 2015.
4Q15 Results
-
Revenues were $245.1 million, up 3% from $238.3 million for the same
period last year and down 3% from $253.3 million in the sequential
period.
-
Benefit for income taxes was $0.4 million ((14.6)% effective rate)
which included a tax benefit from an international legal entity
restructuring, compared to benefit for income taxes of $11.1 million
(7.6% effective rate) which included $114.9 million of non-deductible
goodwill impairment loss for the same period last year and compared to
provision for income taxes of $2.4 million (31.7% effective rate) in
the sequential period.
-
Net income was $2.9 million, compared to net loss of $135.0 million
for the same period last year and down 45% from $5.3 million in the
sequential period.
-
Diluted earnings per share was $0.19, compared to diluted loss per
share of $8.65 for the same period last year and down 45% from $0.34
in the sequential period.
-
Operating net income* was $7.1 million, down 7% from $7.6 million for
the same period last year and up 5% from $6.7 million in the
sequential period.
-
Operating EPS* was $0.46, which included the income tax benefit noted
above and approximately $0.8 million of costs associated with the
restructuring that increased fourth quarter operating EPS by $0.05 per
share, down 6% from $0.48 for the same period last year and up 5% from
$0.44 in the sequential period.
-
Cash flow provided by operations was $37.0 million, up 30% from $28.4
million for the same period last year and compared to $0.4 million in
the sequential period.
-
We provided $1.5 million to our shareholders by paying dividends.
FY15 Results
-
Revenues were $992.4 million, up 2% from $971.7 million for the same
period last year.
-
Provision for income taxes was $8.2 million (35.0% effective rate)
which included a tax benefit from an international legal entity
restructuring, up 404% from $1.6 million ((1.4)% effective rate) which
included $114.9 million of non-deductible goodwill impairment loss for
the same period last year.
-
Net income was $15.3 million, compared to net loss of $115.9 million
for the same period last year.
-
Diluted earnings per share was $0.99, compared to diluted loss per
share of $7.33 for the same period last year.
-
Operating net income* was $25.9 million, down 23% from $33.7 million
for the same period last year.
-
Operating EPS* was $1.67, which included the income tax benefit noted
above and approximately $0.8 million of costs associated with the
restructuring that increased fiscal year operating EPS by $0.05 per
share, down 21% from $2.12 for the same period last year.
-
Cash flow provided by operations was $46.5 million, down 18% from
$56.3 million for the same period last year.
-
We provided $13.0 million to our shareholders by repurchasing $7.0
million of common stock and paying $6.0 million in dividends.
* See the information under the caption "Non-GAAP Financial Measures"
below for a discussion regarding the usefulness of the non-GAAP
financial measures contained in this release, definitions of those
non-GAAP financial measures and reconciliations to their most directly
comparable GAAP financial measures.
Commenting on the fourth quarter of Fiscal 2015 results, Michael
McAndrew, President and Chief Executive Officer, said, "The Black Box
team delivered a third consecutive quarter of year-over-year revenue
growth. We have made significant investments in targeted programs
essential to efficiently providing innovative solutions to our customers
and driving sustainable top line growth. We continue to focus on
balancing cost investments with profitability recognizing that gross
profit and operating margin expansion must be a part of our growth.
“Fiscal 2015 was a year of significant change as we reorganized
functionally across all of our segments. These actions will enable Black
Box to operate as a true enterprise - fully delivering our robust
portfolio of products and services to current and prospective clients
around the world. I am confident that our new fiscal year will show
continued progress on our journey not only through revenue growth but
with increasing profitability as we realize the benefits of our
investments in the business.”
Guidance
For the first quarter of Fiscal 2016, the Company is targeting:
-
Revenues in the range of $235 million to $240 million.
-
Operating earnings per share in the range of $0.24 to $0.29.
Included at the mid-point of the first quarter of Fiscal 2016 target is
a negative impact to Revenues of $5 million and Operating earnings per
share of $0.01, related to the projected impact of foreign currencies
relative to the US dollar compared to the prior year period.
For Fiscal 2016, the Company is targeting:
-
Revenues in the range of $995 million to $1.015 billion.
-
Operating earnings per share in the range of $1.80 to $2.00.
Included at the mid-point of the Fiscal 2016 target is a negative impact
to Revenues of $11 million and Operating earnings per share of $0.02,
related to the projected impact of foreign currencies relative to the US
dollar compared to the prior year period.
Included in these targets is an effective tax rate of 38.5%.These
targets exclude intangible amortization, restructuring expenses and the
impact of changes in the fair market value of the Company’s
interest-rate swap.
Earnings Conference Call
The Company will conduct a conference call beginning at 5:00 p.m.
Eastern Daylight Time today, May 7, 2015. Michael McAndrew, President
and Chief Executive Officer, will host the call. To participate in the
call, please dial 612-332-0107 approximately 15 minutes prior to the
starting time and ask to be connected to the Black Box Earnings Call. A
replay of the conference call will be available for one week after the
teleconference by dialing 320-365-3844 and using access code 358491. A
live, listen-only audio webcast of the call will be available through a
link on the Investor Relations page of the Company's Web site at http://www.blackbox.com.
A webcast replay of the call will also be archived on Black Box's Web
site for a limited period of time following the conference call.
About Black Box
Black Box is a leading technology solutions provider dedicated to
helping customers design, build, manage, and secure their IT
infrastructure. Black Box delivers high-value products and services
through its global presence and 4,000 team members. To learn more, visit
the Black Box Web site at http://www.blackbox.com.
Black Box® and the Double Diamond logo are registered
trademarks of BB Technologies, Inc.
Any forward-looking statements contained in this release are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995 and speak only as of the date of this
release. You can identify these forward-looking statements by the fact
that they use words such as "should," "anticipate," "estimate,"
"approximate," "expect," "target," "may," "will," "project," "intend,"
"plan," "believe" and other words of similar meaning and expression in
connection with any discussion of future operating or financial
performance. One can also identify forward-looking statements by the
fact that they do not relate strictly to historical or current facts.
Forward-looking statements are inherently subject to a variety of risks
and uncertainties that could cause actual results to differ materially
from those projected. Although it is not possible to predict or identify
all risk factors, they may include levels of business activity and
operating expenses, expenses relating to corporate compliance
requirements, cash flows, global economic and business conditions,
successful integration of acquisitions, the timing and costs of
restructuring programs and other initiatives, successful marketing of
the Company's product and services offerings, successful implementation
of the Company's integration initiatives, successful implementation of
our government contracting programs, competition, changes in foreign,
political and economic conditions, fluctuating foreign currencies
compared to the U.S. dollar, rapid changes in technologies, client
preferences, the Company's arrangements with suppliers of voice
equipment and technology, government budgetary constraints and various
other matters, many of which are beyond the Company's control.
Additional risk factors are included in the Company's Annual Report on
Form 10-K for the fiscal year ended March 31, 2014. We can give no
assurance that any goal, plan or target set forth in forward-looking
statements will be achieved and readers are cautioned not to place undue
reliance on such statements, which speak only as of the date made. We
undertake no obligation to release publicly any revisions to
forward-looking statements as a result of future events or developments
and caution you not to unduly rely on any such forward-looking
statements.
|
|
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BLACK BOX CORPORATION
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
|
|
In millions and may not foot due to rounding
|
|
|
March 31, 2015
|
|
March 31, 2014
|
|
Assets
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
23.5
|
|
|
$
|
30.8
|
|
|
Accounts receivable, net
|
|
|
150.6
|
|
|
156.5
|
|
|
Inventories, net
|
|
|
54.4
|
|
|
52.2
|
|
|
Costs/estimated earnings in excess of billings on uncompleted
contracts
|
|
|
79.3
|
|
|
89.8
|
|
|
Other assets
|
|
|
35.5
|
|
|
27.0
|
|
|
Total current assets
|
|
|
343.3
|
|
|
356.3
|
|
|
Property, plant and equipment, net
|
|
|
32.2
|
|
|
29.1
|
|
|
Goodwill, net
|
|
|
191.2
|
|
|
193.0
|
|
|
Intangibles, net
|
|
|
88.1
|
|
|
98.6
|
|
|
Other assets
|
|
|
31.4
|
|
|
35.0
|
|
|
Total assets
|
|
|
$
|
686.3
|
|
|
$
|
712.0
|
|
|
Liabilities
|
|
|
|
|
|
|
Accounts payable
|
|
|
$
|
64.5
|
|
|
$
|
64.6
|
|
|
Accrued compensation and benefits
|
|
|
24.8
|
|
|
26.1
|
|
|
Deferred revenue
|
|
|
34.9
|
|
|
33.8
|
|
|
Billings in excess of costs/estimated earnings on uncompleted
contracts
|
|
|
16.4
|
|
|
15.9
|
|
|
Other liabilities
|
|
|
47.1
|
|
|
40.2
|
|
|
Total current liabilities
|
|
|
187.7
|
|
|
180.6
|
|
|
Long-term debt
|
|
|
137.3
|
|
|
160.4
|
|
|
Other liabilities
|
|
|
24.2
|
|
|
19.8
|
|
|
Total liabilities
|
|
|
$
|
349.1
|
|
|
$
|
360.9
|
|
|
Stockholders’ equity
|
|
|
|
|
|
|
Common stock
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Additional paid-in capital
|
|
|
498.1
|
|
|
492.4
|
|
|
Retained earnings
|
|
|
258.4
|
|
|
249.2
|
|
|
Accumulated other comprehensive income
|
|
|
(13.4
|
)
|
|
7.3
|
|
|
Treasury stock, at cost
|
|
|
(406.0
|
)
|
|
(397.9
|
)
|
|
Total stockholders’ equity
|
|
|
$
|
337.1
|
|
|
$
|
351.1
|
|
|
Total liabilities and stockholders’ equity
|
|
|
$
|
686.3
|
|
|
$
|
712.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BLACK BOX CORPORATION
|
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In millions, except per share amounts and may not foot due to
rounding
|
|
|
4Q15
|
|
3Q15
|
|
4Q14
|
|
FY15
|
|
FY14
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Products
|
|
|
$
|
42.4
|
|
|
$
|
46.6
|
|
|
$
|
46.2
|
|
|
$
|
176.8
|
|
|
$
|
182.2
|
|
|
Total Services
|
|
|
202.6
|
|
|
206.7
|
|
|
192.1
|
|
|
815.6
|
|
|
789.5
|
|
|
Total
|
|
|
245.1
|
|
|
253.3
|
|
|
238.3
|
|
|
992.4
|
|
|
971.7
|
|
|
Cost of sales
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Products
|
|
|
23.9
|
|
|
27.9
|
|
|
27.0
|
|
|
103.1
|
|
|
105.5
|
|
|
Total Services
|
|
|
144.6
|
|
|
148.6
|
|
|
135.7
|
|
|
587.1
|
|
|
562.6
|
|
|
Total
|
|
|
168.5
|
|
|
176.5
|
|
|
162.6
|
|
|
690.2
|
|
|
668.1
|
|
|
Gross profit
|
|
|
76.5
|
|
|
76.8
|
|
|
75.6
|
|
|
302.3
|
|
|
303.6
|
|
|
Selling, general & administrative expenses
|
|
|
70.0
|
|
|
65.1
|
|
|
63.4
|
|
|
263.1
|
|
|
245.5
|
|
|
Goodwill impairment loss
|
|
|
—
|
|
|
—
|
|
|
154.4
|
|
|
—
|
|
|
154.4
|
|
|
Intangibles amortization
|
|
|
2.6
|
|
|
2.6
|
|
|
2.7
|
|
|
10.5
|
|
|
12.0
|
|
|
Operating income (loss)
|
|
|
4.0
|
|
|
9.0
|
|
|
(144.9
|
)
|
|
28.6
|
|
|
(108.4
|
)
|
|
Interest expense, net
|
|
|
1.1
|
|
|
1.2
|
|
|
1.1
|
|
|
4.4
|
|
|
4.6
|
|
|
Other expenses (income), net
|
|
|
0.3
|
|
|
0.1
|
|
|
0.1
|
|
|
0.6
|
|
|
1.2
|
|
|
Income (loss) before provision for income taxes
|
|
|
2.6
|
|
|
7.7
|
|
|
(146.1
|
)
|
|
23.6
|
|
|
(114.2
|
)
|
|
Provision (benefit) for income taxes
|
|
|
(0.4
|
)
|
|
2.4
|
|
|
(11.1
|
)
|
|
8.2
|
|
|
1.6
|
|
|
Net income (loss)
|
|
|
$
|
2.9
|
|
|
$
|
5.3
|
|
|
$
|
(135.0
|
)
|
|
$
|
15.3
|
|
|
$
|
(115.9
|
)
|
|
Earnings (loss) per common share
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
$
|
0.19
|
|
|
$
|
0.34
|
|
|
$
|
(8.65
|
)
|
|
$
|
1.00
|
|
|
$
|
(7.33
|
)
|
|
Diluted
|
|
|
$
|
0.19
|
|
|
$
|
0.34
|
|
|
$
|
(8.65
|
)
|
|
$
|
0.99
|
|
|
$
|
(7.33
|
)
|
|
Weighted-average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
15.4
|
|
|
15.4
|
|
|
15.6
|
|
|
15.4
|
|
|
15.8
|
|
|
Diluted
|
|
|
15.5
|
|
|
15.5
|
|
|
15.6
|
|
|
15.5
|
|
|
15.8
|
|
|
Dividends per share
|
|
|
$
|
0.10
|
|
|
$
|
0.10
|
|
|
$
|
0.09
|
|
|
$
|
0.40
|
|
|
$
|
0.36
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
BLACK BOX CORPORATION
|
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In millions and may not foot due to rounding
|
|
|
4Q15
|
|
3Q15
|
|
4Q14
|
|
FY15
|
|
FY14
|
|
Operating Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
|
$
|
2.9
|
|
|
$
|
5.3
|
|
|
$
|
(135.0
|
)
|
|
$
|
15.3
|
|
|
$
|
(115.9
|
)
|
|
Adjustments to reconcile net income (loss) to net cash provided by
(used for) operating activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangibles amortization
|
|
|
2.6
|
|
|
2.6
|
|
|
2.7
|
|
|
10.5
|
|
|
12.0
|
|
|
Depreciation
|
|
|
1.8
|
|
|
1.7
|
|
|
1.6
|
|
|
7.0
|
|
|
6.2
|
|
|
Loss (gain) on sale of property
|
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
0.1
|
|
|
Deferred taxes
|
|
|
5.3
|
|
|
—
|
|
|
(13.7
|
)
|
|
5.1
|
|
|
(8.7
|
)
|
|
Stock compensation expense
|
|
|
1.1
|
|
|
1.3
|
|
|
1.1
|
|
|
6.0
|
|
|
6.6
|
|
|
Change in fair value of interest-rate swaps
|
|
|
(0.3
|
)
|
|
(0.3
|
)
|
|
(0.2
|
)
|
|
(1.1
|
)
|
|
(0.8
|
)
|
|
Goodwill impairment loss
|
|
|
—
|
|
|
—
|
|
|
154.4
|
|
|
—
|
|
|
154.4
|
|
|
Joint venture investment loss
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.8
|
|
|
Changes in operating assets and liabilities (net of acquisitions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable, net
|
|
|
25.6
|
|
|
(14.2
|
)
|
|
11.4
|
|
|
1.5
|
|
|
(2.9
|
)
|
|
Inventories, net
|
|
|
(0.1
|
)
|
|
(4.0
|
)
|
|
0.5
|
|
|
(3.5
|
)
|
|
3.3
|
|
|
Costs/estimated earnings in excess of billings on uncompleted
contracts
|
|
|
4.1
|
|
|
5.1
|
|
|
2.1
|
|
|
9.9
|
|
|
11.8
|
|
|
All other assets
|
|
|
(16.7
|
)
|
|
(0.6
|
)
|
|
(2.0
|
)
|
|
(14.6
|
)
|
|
(0.8
|
)
|
|
Billings in excess of costs/estimated earnings on uncompleted
contracts
|
|
|
(5.2
|
)
|
|
1.1
|
|
|
0.3
|
|
|
0.6
|
|
|
2.5
|
|
|
Accounts payable
|
|
|
0.6
|
|
|
3.2
|
|
|
4.4
|
|
|
1.8
|
|
|
(1.4
|
)
|
|
All other liabilities
|
|
|
15.2
|
|
|
(0.9
|
)
|
|
0.9
|
|
|
8.1
|
|
|
(11.0
|
)
|
|
Net cash provided by (used for) operating activities
|
|
|
$
|
37.0
|
|
|
$
|
0.4
|
|
|
$
|
28.4
|
|
|
$
|
46.5
|
|
|
$
|
56.3
|
|
|
Investing Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
$
|
(2.1
|
)
|
|
$
|
(2.8
|
)
|
|
$
|
(1.8
|
)
|
|
$
|
(8.5
|
)
|
|
$
|
(7.3
|
)
|
|
Capital disposals
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
Prior merger-related (payments)/recoveries
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.8
|
)
|
|
(0.8
|
)
|
|
Net cash provided by (used for) investing activities
|
|
|
$
|
(2.1
|
)
|
|
$
|
(2.7
|
)
|
|
$
|
(1.8
|
)
|
|
$
|
(9.1
|
)
|
|
$
|
(8.1
|
)
|
|
Financing Activities
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds (repayments) from long-term debt
|
|
|
$
|
(40.0
|
)
|
|
$
|
14.6
|
|
|
$
|
(18.9
|
)
|
|
$
|
(24.5
|
)
|
|
$
|
(27.4
|
)
|
|
Proceeds (repayments) from short-term debt
|
|
|
(0.6
|
)
|
|
(3.9
|
)
|
|
(1.7
|
)
|
|
(2.3
|
)
|
|
2.3
|
|
|
Purchase of treasury stock
|
|
|
—
|
|
|
(2.1
|
)
|
|
(3.0
|
)
|
|
(8.1
|
)
|
|
(21.8
|
)
|
|
Proceeds from the exercise of stock options
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.0
|
|
|
Payment of dividends
|
|
|
(1.5
|
)
|
|
(1.5
|
)
|
|
(1.4
|
)
|
|
(6.0
|
)
|
|
(5.6
|
)
|
|
Increase (decrease) in cash overdrafts
|
|
|
(0.4
|
)
|
|
0.5
|
|
|
0.2
|
|
|
(0.3
|
)
|
|
(0.5
|
)
|
|
Net cash provided by (used for) financing activities
|
|
|
$
|
(42.7
|
)
|
|
$
|
7.6
|
|
|
$
|
(24.9
|
)
|
|
$
|
(41.2
|
)
|
|
$
|
(52.0
|
)
|
|
Foreign currency exchange impact on cash
|
|
|
$
|
(1.9
|
)
|
|
$
|
(0.3
|
)
|
|
$
|
3.4
|
|
|
$
|
(3.5
|
)
|
|
$
|
3.9
|
|
|
Increase/(decrease) in cash and cash equivalents
|
|
|
$
|
(9.8
|
)
|
|
$
|
4.9
|
|
|
$
|
5.2
|
|
|
$
|
(7.3
|
)
|
|
$
|
0.1
|
|
|
Cash and cash equivalents at beginning of period
|
|
|
33.3
|
|
|
28.4
|
|
|
25.6
|
|
|
30.8
|
|
|
30.7
|
|
|
Cash and cash equivalents at end of period
|
|
|
$
|
23.5
|
|
|
$
|
33.3
|
|
|
$
|
30.8
|
|
|
$
|
23.5
|
|
|
$
|
30.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Financial Measures
As a supplement to United States Generally Accepted Accounting
Principles ("GAAP"), the Company provides non-GAAP financial measures
such as operating income before provision for income taxes ("EBIT"),
operating net income, operating earnings per share ("EPS"), revenues
excluding foreign currency, adjusted operating income, Earnings Before
Interest, Taxes, Depreciation and Amortization ("EBITDA"), Operating
EBITDA and free cash flow to illustrate the Company's operational
performance. These non-GAAP financial measures are not prepared in
accordance with GAAP, are not reported by all of the Company's
competitors and may not be directly comparable to similarly-titled
measures of the Company's competitors due to potential differences in
the exact method of calculation. However, each of the amounts included
in the calculation of non-GAAP financial measures are computed in
accordance with GAAP. See below for reconciliations to the most directly
comparable GAAP financial measures.
Management uses these non-GAAP financial measures (a) to evaluate the
Company's historical and prospective financial performance as well as
its performance relative to its competitors, (b) to set internal sales
targets and associated operating budgets, (c) to allocate resources and
(d) to measure operational profitability. Management uses similar
non-GAAP measures as an important factor in determining variable
compensation for Management and its team members.
Non-GAAP financial measures are not in accordance with, or an
alternative for, GAAP financial measures. The Company's non-GAAP
financial measures are not meant to be considered in isolation or as a
substitute for comparable GAAP financial measures, and should be read
only in conjunction with the Company's consolidated financial statements
prepared in accordance with GAAP.
Operating EBIT, operating net income and operating EPS
Management believes that operating EBIT, defined by the Company as net
income (loss) plus provision (benefit) for income taxes and adjustments,
operating net income, defined by the Company as operating EBIT less
operational income taxes, and operating EPS, defined as operating net
income divided by weighted average common shares outstanding (diluted),
provide investors additional important information to enable them to
assess, in the way Management assesses, the Company's current and future
operations. Adjustments include intangibles amortization, the change in
fair value of the interest-rate swaps, goodwill impairment loss and the
joint venture investment loss, each of which are non-cash charges, and
restructuring, which is a cash charge.
A reconciliation of Net income (loss) to operating EBIT and Operating
net income is presented below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In millions and may not foot due to rounding
|
|
|
4Q15
|
|
3Q15
|
|
4Q14
|
|
FY15
|
|
FY14
|
|
Net income (loss)
|
|
|
$
|
2.9
|
|
|
$
|
5.3
|
|
|
$
|
(135.0
|
)
|
|
$
|
15.3
|
|
|
$
|
(115.9
|
)
|
|
Provision (benefit) for income taxes
|
|
|
(0.4
|
)
|
|
2.4
|
|
|
(11.1
|
)
|
|
8.2
|
|
|
1.6
|
|
|
Effective tax rate
|
|
|
(14.6
|
)%
|
|
31.7
|
%
|
|
7.6
|
%
|
|
35.0
|
%
|
|
(1.4
|
)%
|
|
Income (loss) before provision for income taxes
|
|
|
$
|
2.6
|
|
|
$
|
7.7
|
|
|
$
|
(146.1
|
)
|
|
$
|
23.6
|
|
|
$
|
(114.2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible amortization
|
|
|
$
|
2.6
|
|
|
$
|
2.6
|
|
|
$
|
2.7
|
|
|
$
|
10.5
|
|
|
$
|
12.0
|
|
|
Change in fair value of interest-rate swaps
|
|
|
(0.3
|
)
|
|
(0.3
|
)
|
|
(0.2
|
)
|
|
(1.1
|
)
|
|
(0.8
|
)
|
|
Restructuring expense
|
|
|
4.1
|
|
|
1.0
|
|
|
1.7
|
|
|
6.9
|
|
|
3.4
|
|
|
Goodwill impairment loss
|
|
|
—
|
|
|
—
|
|
|
154.4
|
|
|
—
|
|
|
154.4
|
|
|
Joint venture investment loss
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.8
|
|
|
Total pre-tax adjustments
|
|
|
$
|
6.4
|
|
|
$
|
3.3
|
|
|
$
|
158.7
|
|
|
$
|
16.3
|
|
|
$
|
169.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating EBIT
|
|
|
$
|
9.0
|
|
|
$
|
11.0
|
|
|
$
|
12.6
|
|
|
$
|
39.8
|
|
|
$
|
55.6
|
|
|
Operational effective tax rate
|
|
|
21.4
|
%
|
|
39.0
|
%
|
|
39.5
|
%
|
|
35.0
|
%
|
|
39.5
|
%
|
|
Operational income taxes (1)
|
|
|
1.9
|
|
|
4.3
|
|
|
5.0
|
|
|
14.0
|
|
|
22.0
|
|
|
Operating net income
|
|
|
$
|
7.1
|
|
|
$
|
6.7
|
|
|
$
|
7.6
|
|
|
$
|
25.9
|
|
|
$
|
33.7
|
|
(1) The effective tax rate used to determine operational income taxes is
based on the Company's projected full-year ordinary income tax expense
and the projected full-year impact of certain discreet tax items.
A reconciliation of Diluted earnings (loss) per share to operating EPS
is presented below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q15
|
|
3Q15
|
|
4Q14
|
|
FY15
|
|
FY14
|
|
Diluted EPS
|
|
|
$
|
0.19
|
|
|
$
|
0.34
|
|
|
$
|
(8.65
|
)
|
|
$
|
0.99
|
|
|
$
|
(7.33
|
)
|
|
EPS impact *
|
|
|
0.27
|
|
|
0.10
|
|
|
9.13
|
|
|
0.68
|
|
|
9.45
|
|
|
Operating EPS
|
|
|
$
|
0.46
|
|
|
$
|
0.44
|
|
|
$
|
0.48
|
|
|
$
|
1.67
|
|
|
$
|
2.12
|
|
* EPS impact is the result of excluding the provision for income taxes
and the adjustments and utilizing an operational effective tax rate.
Revenues excluding foreign currency
Management is presented with and reviews revenues which exclude foreign
currency and enable an investor to assess, in the way Management
assesses, revenues from its core operations.
Information on quarterly revenues excluding foreign currency compared to
the same period last year is presented below:
|
|
|
|
|
|
|
|
|
|
In millions and may not foot due to rounding
|
|
|
4Q15
|
|
4Q14
|
|
% Change
|
|
Revenues
|
|
|
$
|
245.1
|
|
|
$
|
238.3
|
|
|
3
|
%
|
|
Foreign currency impact - North America Products
|
|
|
0.1
|
|
|
—
|
|
|
|
|
Foreign currency impact - North America Services
|
|
|
0.3
|
|
|
—
|
|
|
|
|
Foreign currency impact - International Products
|
|
|
3.7
|
|
|
—
|
|
|
|
|
Foreign currency impact - International Services
|
|
|
1.1
|
|
|
—
|
|
|
|
|
Revenues (excluding foreign currency)
|
|
|
$
|
250.2
|
|
|
$
|
238.3
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Information on quarterly revenues excluding foreign currency compared to
the sequential quarter is presented below:
|
|
|
|
|
|
|
|
|
|
In millions and may not foot due to rounding
|
|
|
4Q15
|
|
3Q15
|
|
% Change
|
|
Revenues
|
|
|
$
|
245.1
|
|
|
$
|
253.3
|
|
|
(3
|
)%
|
|
Foreign currency impact - North America Products
|
|
|
0.1
|
|
|
—
|
|
|
|
|
Foreign currency impact - North America Services
|
|
|
0.2
|
|
|
—
|
|
|
|
|
Foreign currency impact - International Products
|
|
|
1.7
|
|
|
—
|
|
|
|
|
Foreign currency impact - International Services
|
|
|
0.5
|
|
|
—
|
|
|
|
|
Revenues (excluding foreign currency)
|
|
|
$
|
247.5
|
|
|
$
|
253.3
|
|
|
(2
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Information on year-to-date revenues excluding foreign currency compared
to the same period last year is presented below:
|
|
|
|
|
|
|
|
|
|
In millions and may not foot due to rounding
|
|
|
FY15
|
|
FY14
|
|
% Change
|
|
Revenues
|
|
|
$
|
992.4
|
|
|
$
|
971.7
|
|
|
2
|
%
|
|
Foreign currency impact - North America Products
|
|
|
0.3
|
|
|
—
|
|
|
|
|
Foreign currency impact - North America Services
|
|
|
1.0
|
|
|
—
|
|
|
|
|
Foreign currency impact - International Products
|
|
|
5.2
|
|
|
—
|
|
|
|
|
Foreign currency impact - International Services
|
|
|
1.0
|
|
|
—
|
|
|
|
|
Revenues (excluding foreign currency)
|
|
|
$
|
999.9
|
|
|
$
|
971.7
|
|
|
3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Information
Management is presented with and reviews Revenues, Gross profit,
Operating income (loss) and Adjusted operating income by segment.
Management believes that Adjusted operating income, defined by the
Company as Operating income (loss) plus adjustments, provides investors
additional important information to enable them to assess, in the way
Management assesses, the Company's current and future operations.
Adjustments include intangibles amortization, goodwill impairment loss
and restructuring expense.
A reconciliation of Operating income (loss) to Adjusted operating income
(by segment) is presented below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q15
|
|
3Q15
|
|
4Q14
|
|
FY15
|
|
FY14
|
|
In millions and may not foot due to rounding
|
|
|
$
|
|
% of Rev
|
|
$
|
|
% of Rev
|
|
$
|
|
% of Rev
|
|
$
|
|
% of Rev
|
|
$
|
|
% of Rev
|
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Products
|
|
|
$
|
20.5
|
|
|
|
|
$
|
21.8
|
|
|
|
|
$
|
20.7
|
|
|
|
|
$
|
85.2
|
|
|
|
|
$
|
82.8
|
|
|
|
|
International Products
|
|
|
22.0
|
|
|
|
|
24.8
|
|
|
|
|
25.6
|
|
|
|
|
91.6
|
|
|
|
|
99.3
|
|
|
|
|
Total Products
|
|
|
$
|
42.4
|
|
|
|
|
$
|
46.6
|
|
|
|
|
$
|
46.2
|
|
|
|
|
$
|
176.8
|
|
|
|
|
$
|
182.2
|
|
|
|
|
North America Services
|
|
|
$
|
195.5
|
|
|
|
|
$
|
198.4
|
|
|
|
|
$
|
183.5
|
|
|
|
|
$
|
785.7
|
|
|
|
|
$
|
753.5
|
|
|
|
|
International Services
|
|
|
7.1
|
|
|
|
|
8.3
|
|
|
|
|
8.5
|
|
|
|
|
29.9
|
|
|
|
|
36.0
|
|
|
|
|
Total Services
|
|
|
$
|
202.6
|
|
|
|
|
$
|
206.7
|
|
|
|
|
$
|
192.1
|
|
|
|
|
$
|
815.6
|
|
|
|
|
$
|
789.5
|
|
|
|
|
Total
|
|
|
$
|
245.1
|
|
|
|
|
$
|
253.3
|
|
|
|
|
$
|
238.3
|
|
|
|
|
$
|
992.4
|
|
|
|
|
$
|
971.7
|
|
|
|
|
Gross profit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Products
|
|
|
$
|
9.7
|
|
|
47.6
|
%
|
|
$
|
8.7
|
|
|
39.8
|
%
|
|
$
|
8.4
|
|
|
40.5
|
%
|
|
$
|
36.1
|
|
|
42.3
|
%
|
|
$
|
34.6
|
|
|
41.8
|
%
|
|
International Products
|
|
|
8.8
|
|
|
39.9
|
%
|
|
10.0
|
|
|
40.3
|
%
|
|
10.9
|
|
|
42.6
|
%
|
|
37.7
|
|
|
41.1
|
%
|
|
42.1
|
|
|
42.3
|
%
|
|
Total Products
|
|
|
$
|
18.5
|
|
|
43.6
|
%
|
|
$
|
18.7
|
|
|
40.1
|
%
|
|
$
|
19.2
|
|
|
41.6
|
%
|
|
$
|
73.7
|
|
|
41.7
|
%
|
|
$
|
76.7
|
|
|
42.1
|
%
|
|
North America Services
|
|
|
$
|
56.0
|
|
|
28.6
|
%
|
|
$
|
55.8
|
|
|
28.1
|
%
|
|
$
|
54.8
|
|
|
29.9
|
%
|
|
$
|
220.5
|
|
|
28.1
|
%
|
|
$
|
219.3
|
|
|
29.1
|
%
|
|
International Services
|
|
|
2.1
|
|
|
29.0
|
%
|
|
2.3
|
|
|
27.6
|
%
|
|
1.6
|
|
|
18.8
|
%
|
|
8.1
|
|
|
26.9
|
%
|
|
7.6
|
|
|
21.0
|
%
|
|
Total Services
|
|
|
$
|
58.0
|
|
|
28.6
|
%
|
|
$
|
58.1
|
|
|
28.1
|
%
|
|
$
|
56.4
|
|
|
29.4
|
%
|
|
$
|
228.5
|
|
|
28.0
|
%
|
|
$
|
226.9
|
|
|
28.7
|
%
|
|
Total
|
|
|
$
|
76.5
|
|
|
31.2
|
%
|
|
$
|
76.8
|
|
|
30.3
|
%
|
|
$
|
75.6
|
|
|
31.7
|
%
|
|
$
|
302.3
|
|
|
30.5
|
%
|
|
$
|
303.6
|
|
|
31.2
|
%
|
|
Operating income (loss)(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Products
|
|
|
$
|
1.8
|
|
|
8.7
|
%
|
|
$
|
0.7
|
|
|
3.2
|
%
|
|
$
|
(42.0
|
)
|
|
(203.3
|
)%
|
|
$
|
4.6
|
|
|
5.4
|
%
|
|
$
|
(37.8
|
)
|
|
(45.6
|
)%
|
|
International Products
|
|
|
(0.9
|
)
|
|
(4.1
|
)%
|
|
0.6
|
|
|
2.4
|
%
|
|
(18.8
|
)
|
|
(73.7
|
)%
|
|
(0.3
|
)
|
|
(0.3
|
)%
|
|
(14.8
|
)
|
|
(14.9
|
)%
|
|
Total Products
|
|
|
$
|
0.9
|
|
|
2.0
|
%
|
|
$
|
1.3
|
|
|
2.8
|
%
|
|
$
|
(60.8
|
)
|
|
(131.6
|
)%
|
|
$
|
4.3
|
|
|
2.4
|
%
|
|
$
|
(52.6
|
)
|
|
(28.9
|
)%
|
|
North America Services
|
|
|
$
|
2.4
|
|
|
1.2
|
%
|
|
$
|
6.9
|
|
|
3.5
|
%
|
|
$
|
(79.0
|
)
|
|
(43.0
|
)%
|
|
$
|
22.2
|
|
|
2.8
|
%
|
|
$
|
(50.7
|
)
|
|
(6.7
|
)%
|
|
International Services
|
|
|
0.7
|
|
|
9.5
|
%
|
|
0.8
|
|
|
9.7
|
%
|
|
(5.1
|
)
|
|
(59.2
|
)%
|
|
2.1
|
|
|
7.0
|
%
|
|
(5.0
|
)
|
|
(13.9
|
)%
|
|
Total Services
|
|
|
$
|
3.1
|
|
|
1.5
|
%
|
|
$
|
7.7
|
|
|
3.7
|
%
|
|
$
|
(84.0
|
)
|
|
(43.8
|
)%
|
|
$
|
24.3
|
|
|
3.0
|
%
|
|
$
|
(55.8
|
)
|
|
(7.1
|
)%
|
|
Total
|
|
|
$
|
4.0
|
|
|
1.6
|
%
|
|
$
|
9.0
|
|
|
3.6
|
%
|
|
$
|
(144.9
|
)
|
|
(60.8
|
)%
|
|
$
|
28.6
|
|
|
2.9
|
%
|
|
$
|
(108.4
|
)
|
|
(11.2
|
)%
|
|
Adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Products
|
|
|
$
|
0.2
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
42.7
|
|
|
|
|
$
|
0.2
|
|
|
|
|
$
|
42.9
|
|
|
|
|
International Products
|
|
|
1.3
|
|
|
|
|
0.6
|
|
|
|
|
20.4
|
|
|
|
|
2.3
|
|
|
|
|
20.8
|
|
|
|
|
Total Products
|
|
|
$
|
1.4
|
|
|
|
|
$
|
0.6
|
|
|
|
|
$
|
63.2
|
|
|
|
|
$
|
2.5
|
|
|
|
|
$
|
63.7
|
|
|
|
|
North America Services
|
|
|
$
|
5.0
|
|
|
|
|
$
|
3.0
|
|
|
|
|
$
|
90.5
|
|
|
|
|
$
|
14.4
|
|
|
|
|
$
|
100.9
|
|
|
|
|
International Services
|
|
|
0.3
|
|
|
|
|
—
|
|
|
|
|
5.2
|
|
|
|
|
0.5
|
|
|
|
|
5.4
|
|
|
|
|
Total Services
|
|
|
$
|
5.3
|
|
|
|
|
$
|
3.0
|
|
|
|
|
$
|
95.7
|
|
|
|
|
$
|
14.9
|
|
|
|
|
$
|
106.2
|
|
|
|
|
Total
|
|
|
$
|
6.7
|
|
|
|
|
$
|
3.6
|
|
|
|
|
$
|
158.8
|
|
|
|
|
$
|
17.4
|
|
|
|
|
$
|
169.9
|
|
|
|
|
Adjusted operating income(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Products
|
|
|
$
|
1.9
|
|
|
9.4
|
%
|
|
$
|
0.7
|
|
|
3.2
|
%
|
|
$
|
0.7
|
|
|
3.5
|
%
|
|
$
|
4.8
|
|
|
5.6
|
%
|
|
$
|
5.1
|
|
|
6.2
|
%
|
|
International Products
|
|
|
0.3
|
|
|
1.6
|
%
|
|
1.2
|
|
|
4.8
|
%
|
|
1.6
|
|
|
6.3
|
%
|
|
2.0
|
|
|
2.2
|
%
|
|
5.9
|
|
|
5.9
|
%
|
|
Total Products
|
|
|
$
|
2.3
|
|
|
5.4
|
%
|
|
$
|
1.9
|
|
|
4.0
|
%
|
|
$
|
2.3
|
|
|
5.1
|
%
|
|
$
|
6.8
|
|
|
3.8
|
%
|
|
$
|
11.0
|
|
|
6.1
|
%
|
|
North America Services
|
|
|
$
|
7.5
|
|
|
3.8
|
%
|
|
$
|
9.9
|
|
|
5.0
|
%
|
|
$
|
11.5
|
|
|
6.3
|
%
|
|
$
|
36.6
|
|
|
4.7
|
%
|
|
$
|
50.1
|
|
|
6.7
|
%
|
|
International Services
|
|
|
1.0
|
|
|
13.6
|
%
|
|
0.8
|
|
|
9.7
|
%
|
|
0.1
|
|
|
1.3
|
%
|
|
2.6
|
|
|
8.6
|
%
|
|
0.3
|
|
|
0.9
|
%
|
|
Total Services
|
|
|
$
|
8.4
|
|
|
4.2
|
%
|
|
$
|
10.7
|
|
|
5.2
|
%
|
|
$
|
11.6
|
|
|
6.1
|
%
|
|
$
|
39.2
|
|
|
4.8
|
%
|
|
$
|
50.5
|
|
|
6.4
|
%
|
|
Total
|
|
|
$
|
10.7
|
|
|
4.4
|
%
|
|
$
|
12.6
|
|
|
5.0
|
%
|
|
$
|
14.0
|
|
|
5.9
|
%
|
|
$
|
46.0
|
|
|
4.6
|
%
|
|
$
|
61.5
|
|
|
6.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) These results reflect a reclassification of expense that reduced
Operating income (loss) and Adjusted operating income in North America
Products by $804, $1,218 and $1,686 in 4Q14, FY15 and FY14,
respectively, with a corresponding increase of the same amounts for
Operating income (loss) and Adjusted operating income in North America
Services. This reclassification had no effect on our consolidated
financial results.
EBITDA and Operating EBITDA
Management believes that EBITDA, defined as Net income (loss) plus
provision (benefit) for income taxes, interest, depreciation and
amortization, is a widely-accepted measure of profitability that may be
used to measure the Company's ability to service its debt. Operating
EBITDA, defined as EBITDA plus stock compensation expense, the goodwill
impairment loss and the joint venture investment loss may also be used
to measure the Company's ability to service its debt.
A reconciliation of Net income (loss) to EBITDA and Operating EBITDA is
presented below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In millions and may not foot due to rounding
|
|
|
4Q15
|
|
3Q15
|
|
4Q14
|
|
FY15
|
|
FY14
|
|
Net income (loss)
|
|
|
$
|
2.9
|
|
|
$
|
5.3
|
|
|
$
|
(135.0
|
)
|
|
$
|
15.3
|
|
|
$
|
(115.9
|
)
|
|
Provision (benefit) for income taxes
|
|
|
(0.4
|
)
|
|
2.4
|
|
|
(11.1
|
)
|
|
8.2
|
|
|
1.6
|
|
|
Interest expense, net
|
|
|
1.1
|
|
|
1.2
|
|
|
1.1
|
|
|
4.4
|
|
|
4.6
|
|
|
Intangibles amortization
|
|
|
2.6
|
|
|
2.6
|
|
|
2.7
|
|
|
10.5
|
|
|
12.0
|
|
|
Depreciation
|
|
|
1.8
|
|
|
1.7
|
|
|
1.6
|
|
|
7.0
|
|
|
6.2
|
|
|
EBITDA
|
|
|
$
|
8.1
|
|
|
$
|
13.3
|
|
|
$
|
(140.7
|
)
|
|
$
|
45.5
|
|
|
$
|
(91.4
|
)
|
|
Stock compensation expense
|
|
|
1.1
|
|
|
1.3
|
|
|
1.1
|
|
|
6.0
|
|
|
6.6
|
|
|
Goodwill impairment loss
|
|
|
—
|
|
|
—
|
|
|
154.4
|
|
|
—
|
|
|
154.4
|
|
|
Joint venture investment loss
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.8
|
|
|
Operating EBITDA
|
|
|
$
|
9.2
|
|
|
$
|
14.6
|
|
|
$
|
14.9
|
|
|
$
|
51.5
|
|
|
$
|
70.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow
Management believes that free cash flow, defined by the Company as Net
cash provided by (used for) operating activities less net capital
expenditures, plus Proceeds from stock option exercises, plus or minus
Foreign currency exchange impact on cash, is an important measurement of
liquidity as it represents the total cash available to the Company.
A reconciliation of Net cash provided by (used for) operating activities
to free cash flow is presented below:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In millions and may not foot due to rounding
|
|
|
4Q15
|
|
3Q15
|
|
4Q14
|
|
FY15
|
|
FY14
|
|
Net cash provided by (used for) operating activities
|
|
|
$
|
37.0
|
|
|
$
|
0.4
|
|
|
$
|
|
28.4
|
|
|
$
|
|
46.5
|
|
|
$
|
|
56.3
|
|
|
Net capital expenditures
|
|
|
(2.1
|
)
|
|
(2.7
|
)
|
|
(1.8
|
)
|
|
(8.3
|
)
|
|
(7.3
|
)
|
|
Foreign currency exchange impact on cash
|
|
|
(1.9
|
)
|
|
(0.3
|
)
|
|
3.4
|
|
|
(3.5
|
)
|
|
3.9
|
|
|
Free cash flow before stock option exercises
|
|
|
$
|
32.9
|
|
|
$
|
(2.6
|
)
|
|
$
|
|
30.1
|
|
|
$
|
|
34.7
|
|
|
$
|
|
52.9
|
|
|
Proceeds from the exercise of stock options
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.0
|
|
|
Free cash flow
|
|
|
$
|
32.9
|
|
|
$
|
(2.6
|
)
|
|
$
|
|
30.1
|
|
|
$
|
|
34.7
|
|
|
$
|
|
53.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Significant Balance Sheet ratios and Other Information
Information on certain balance sheet ratios, backlog and headcount is
presented below:
|
|
|
|
|
|
|
|
|
|
Dollars In millions
|
|
|
4Q15
|
|
3Q15
|
|
4Q14
|
|
Days sales outstanding
|
|
|
52 days
|
|
62 days
|
|
54 days
|
|
Aggregate days sales outstanding
|
|
|
77 days
|
|
84 days
|
|
86 days
|
|
Net inventory turns
|
|
|
11.9x
|
|
10.6x
|
|
9.3x
|
|
Six-month order backlog
|
|
|
$
|
168.7
|
|
|
$
|
169.2
|
|
|
$
|
183.4
|
|
Team members
|
|
|
3,803
|
|
|
3,913
|
|
|
3,959
|
|
Net Debt
|
|
|
$
|
113.7
|
|
|
$
|
142.8
|
|
|
$
|
129.6
|
|
Leverage ratio
|
|
|
2.7
|
|
|
3.1
|
|
|
2.3
|
Copyright Business Wire 2015