Highlights
- Fourth quarter 2017 revenue of $87.3 million, up 14.5% compared to $76.3 million in the prior year period, led by organic
revenue growth of 12.9%.
- Full Year 2017 revenue of $327.1 million, up 2.3% compared to $319.8 million in the prior year period, including organic
revenue growth of 0.6%.
- Fourth quarter 2017 GAAP operating income of $4.7 million; Non-GAAP operating income of $11.1 million.
- Fourth quarter 2017 GAAP net earnings of $2.7 million, or $0.17 per diluted share; Non-GAAP net earnings of $6.9 million, or
$0.43 per diluted share.
DALLAS, June 14, 2017 (GLOBE NEWSWIRE) -- CSW Industrials, Inc. (NASDAQ:CSWI), a diversified industrial growth
company with well-established, scalable platforms and domain expertise across three segments: Industrial Products; Coatings,
Sealants & Adhesives; and Specialty Chemicals, today reported results for the fiscal fourth quarter and full year ended March 31,
2017.
Net revenue during the fiscal fourth quarter of 2017 increased 14.5% to $87.3 million, compared to the prior
year period of $76.3 million. Organic growth was 12.9%, and acquisitions contributed 1.6% to total growth. The increase in
revenue was primarily attributable to increases in architecturally-specified building products and HVAC end markets, partially
offset by decreases in the rail end market.
Net income in the fiscal fourth quarter of 2017 was $2.7 million, or $0.17 per diluted share, compared to $1.9
million, or $0.12 per diluted share, in the prior year period. Adjusted to exclude one-time expenses, adjusted net income in the
fiscal fourth quarter of 2017 was up 23.5% to $6.9 million, or $0.43 per diluted share, compared to $5.6 million, or $0.35 per
diluted share, in the prior year period.
During the fiscal fourth quarter 2017 the Company announced the acquisition of Greco Aluminum Railings, a
leading manufacturer of high-quality engineered railing and safety systems for multi-family and commercial structures in the United
States and Canada. The acquisition underscored CSWI’s strategy to identify best-in-class products and leverage existing
routes to market and served end markets to drive profitable growth, creating a strong strategic fit within the Company’s
architecturally-specified building product category. The integration of this acquisition is progressing well, and results are
included in CSWI’s Industrial Products business segment.
Joseph B. Armes, CSW Industrials’ Chief Executive Officer, commented, “We are pleased to report the successful
completion of our first full-year as a public company. We achieved several milestones during the year, including successfully
rationalizing the footprint of our Jet-Lube operations and the acquisition of Greco. We finished the fourth quarter with a
record-breaking performance in several of our construction related end markets, and while we are still managing macro pressure in
rail and the volatility in the energy markets, we are beginning to see some stability and modest recovery in some areas.” Armes
concluded, “Fiscal 2017 was a year of transition, which included a substantial effort to optimize our management structure and our
operations as a new public company against a backdrop of mixed end market conditions. We are excited to enter Fiscal 2018 with the
bulk of our most significant reorganization efforts behind us, and we expect to leverage our greater efficiency to drive further
improvement in our results.”
Fourth Quarter Results of Operations
Consolidated revenue increased to $87.3 million, compared with the prior year level of $76.3 million.
Industrial Products segment revenue was $41.6 million, compared to the prior year of $33.9 million. Higher
revenue was mainly the result of strong sales of our architecturally-specified products, plumbing and HVAC end markets. GAAP
operating income increased to $8.4 million, compared to the prior year of $6.3 million. Adjusted to exclude non-recurring expenses,
segment operating income increased 52.2% to $9.6 million, compared to the prior year period of $6.3 million.
Coatings, Sealants and Adhesives (CS&A) segment revenue was $26.7 million, compared to the prior year of
$25.3 million. Higher sales were attributable to new business associated with fire stopping sealants, HVAC and plumbing, partially
offset by lower OEM rail volume with existing customers. GAAP segment operating loss was $59.0 thousand, compared to the prior year
loss of $63.0 thousand. Adjusted to exclude non-recurring costs primarily related to realignment and restructuring, segment
operating income was $1.9 million, compared to the prior year period of $424 thousand.
Specialty Chemicals segment revenue was $19.1 million, compared to the prior year of $16.9 million. Higher sales
were driven by drilling compounds plus new industrial lubricant business in cement and power generation end markets. GAAP segment
operating loss was $817 thousand, compared to prior year period operating income of $3.1 million. Adjusted to exclude non-recurring
costs, segment operating income decreased to $2.4 million, compared to $3.1 million in the prior year.
Consolidated gross profit was $31.1 million, a 9.7% decrease compared to the prior year level of $34.4
million. Gross margin as a percentage of sales was 35.6%, compared to 45.1% in the prior year period. Lower gross margin
compared to the prior year primarily reflected increased costs related to restructuring and realignment as the Company improves its
operational footprint. In total, the Company incurred $5.3 million in restructuring and realignment costs during the period.
Consolidated operating expenses decreased 4.6% to $26.4 million, or 30.2% of sales, compared to the prior year
level of $27.6 million, or 36.2% of sales. Lower operating costs compared to the prior year were primarily attributable to reduced
compensation and benefit expenses.
Consolidated net income was $2.7 million, or $0.17 per diluted share, compared to $1.9 million, or $0.12 per
diluted share in the fiscal 2016. Adjusted to exclude one-time expenses and applying a normalized tax rate, adjusted net income in
the fourth quarter of fiscal 2017 was up 23.5% to $6.9 million, or $0.43 per diluted share, compared to $5.6 million, or $0.35 per
diluted share, in the prior year period.
Full Year Results of Operations
Consolidated revenue increased 2.3% to $327.1 million, compared with prior year revenue of $319.8 million. Higher
revenue was attributed to recent acquisitions, coupled with organic growth in HVAC, plumbing and architecturally-specified building
products. Higher construction related volume was partially offset by decreased volumes in rail, energy, and mining end markets.
Industrial Products segment revenue increased to $158.7 million, compared to the prior year level of $138.6
million. The increase in revenue was mainly the result of strong organic growth and acquisitions made in the past twelve months.
GAAP operating income increased to $32.9 million, over the prior year level of $31.1 million. Segment adjusted operating income
increased to $34.6 million compared to the prior year of $27.9 million.
CS&A segment revenue decreased to $96.9 million, compared to the prior year level of $106.0 million.
Decreased sales were attributable to lower sales volumes in rail end markets, partially offset by higher sales into fire stopping
sealants, HVAC and Plumbing end markets. GAAP operating income was $851 thousand, compared to the prior year period of $10.9
million. Segment adjusted operating income declined to $8.2 million, compared to the prior year level of $11.1 million.
Specialty Chemicals segment revenue decreased to $71.5 million, compared to the prior year level of $74.9
million. Lower sales were attributable to weakness in rail, mining and energy end markets. GAAP operating income was $2.0 million,
compared to the prior year period of $12.5 million. Segment adjusted operating income declined to $8.6 million, compared to the
prior year level of $9.6 million.
Consolidated organic revenue increased 0.6%, reflecting our strong sales in HVAC, plumbing and
architecturally-specified building products.
Consolidated gross profit decreased 9.5% to $133.8 million over the prior year level of $147.9 million. Gross
margin as a percentage of sales was 40.9%, compared to 46.2% in the prior year period. Lower gross margin compared to the prior
year primarily reflects lower volume and profitability of products sold into energy and rail end markets, restructuring and
realignment charges, and pension gain in the prior-year that did not recur and other discrete items.
Consolidated operating expenses were $111.4 million, or 34.0% of sales, compared to the prior year level of
$100.4 million, or 31.4% of sales. Increased operating expenses were attributable to restructuring and other discrete items in the
current year and the pension gain in the prior year that did not recur, partially offset by startup costs in the prior year which
did not recur. In addition, the prior year reflects only half a year of corporate costs, as this was our first full year as a
public company.
Consolidated net income was $11.1 million, or $0.70 per diluted share, compared with net income of $25.5
million, or $1.62 per diluted share, in the prior year period. Adjusted for one-time items and a normalized tax rate, net income
was $26.7 million, or $1.68 per diluted share, compared to net income of $27.0 million, or $1.72 per diluted share in the prior
year. Adjustments to net income are shown in the table below.
Conference Call Information
The company will host a conference call today at 10:00 a.m. ET to discuss the results, followed by a question and
answer session for the investment community. A live webcast of the call can be accessed at ir.cswindustrials.com. To access the call, participants may dial toll-free at 1-877-407-0784 or
1-201-689-8560 (international) and request to join the CSW Industrials earnings call.
To listen to a telephonic replay of the conference call, dial toll-free 1-844-512-2921 or 1-412-317-6671
(international) and enter confirmation code 13663735. The telephonic replay will be available beginning at 1:00 p.m. ET on
Wednesday, June 14, 2017, and will last through 11:59 p.m. ET on Wednesday, June 28, 2017. The call will also be available
for replay via the webcast link on CSW Industrials’ Investor Relations website.
Safe Harbor Statement
This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934, which are made pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, as amended. Words or phrases such as "may," "should," "expects," "could," "intends," "plans,"
"anticipates," "estimates," "believes," "forecasts," "predicts" or other similar expressions are intended to identify
forward-looking statements, which include, without limitation, earnings forecasts, statements relating to our business strategy and
statements of expectations, beliefs, future plans and strategies and anticipated developments concerning our industry, business,
operations and financial performance and condition.
The forward-looking statements included in this press release are based on our current expectations,
projections, estimates and assumptions. These statements are only predictions, not guarantees. Such forward-looking statements are
subject to numerous risks and uncertainties that are difficult to predict. These risks and uncertainties may cause actual results
to differ materially from what is forecast in such forward-looking statements, and include, without limitation, the risk factors
described from time to time in our filings with the Securities and Exchange Commission, including our Annual Report on Form
10-K.
All forward-looking statements included in this press release are based on information currently available to
us, and we assume no obligation to update any forward-looking statement except as may be required by law.
Non-GAAP Financial Measures
This press release includes an analysis of adjusted earnings per share, adjusted net income, and adjusted operating income, which
are non-GAAP financial measures of performance. For a reconciliation of these measures to the most directly comparable GAAP
measures and for a discussion of why we consider these Non-GAAP measures useful, see the “Reconciliation of Non-GAAP Measures”
section of this release.
About CSW Industrials
CSWI is a diversified industrial growth company with well-established, scalable platforms and domain expertise across three
segments: Industrial Products; Coatings, Sealants & Adhesives; and Specialty Chemicals. CSWI's broad portfolio of leading products
provides performance optimizing solutions to its customers. CSWI's products include mechanical products for heating, ventilation
and air conditioning ("HVAC") and refrigeration applications, coatings and sealants and high performance specialty lubricants.
Markets that CSWI serves include: HVAC, industrial, rail, plumbing, architecturally-specified building products, energy, mining and
general industrial markets.
| |
|
|
| CONSOLIDATED STATEMENTS OF
INCOME |
| (unaudited) |
| |
|
|
| Quarter Ended March 31, 2017 |
|
|
2017 |
|
|
2016 |
| Revenues, net |
|
|
87,349 |
|
|
76,259 |
| Cost of revenues |
|
|
(56,276) |
|
|
(41,832) |
| Gross profit |
|
|
31,073 |
|
|
34,427 |
| Gross profit margin |
|
|
35.6% |
|
|
45.1% |
| Total operating expenses |
|
|
(26,352) |
|
|
(27,631) |
| Operating expenses as a % of Sales |
|
|
30.2% |
|
|
36.2% |
| Operating income |
|
|
4,721 |
|
|
6,796 |
| Operating margin |
|
|
5.4% |
|
|
8.9% |
| Interest expense, net |
|
|
(532) |
|
|
(743) |
| Other income (expense), net |
|
|
(116) |
|
|
(41) |
| Income before income taxes |
|
|
4,073 |
|
|
6,012 |
| Provision for income taxes |
|
|
(1,345) |
|
|
(4,152) |
| Net income |
|
|
2,728 |
|
|
1,860 |
| Diluted EPS |
|
$ |
0.17 |
|
$ |
0.12 |
| |
|
|
|
|
| (audited) |
| Year Ended March 31, 2017 |
|
|
2017 |
|
|
2016 |
| Revenues, net |
|
|
327,084 |
|
|
319,831 |
| Cost of revenues |
|
|
(193,247) |
|
|
(171,967) |
| Gross profit |
|
|
133,837 |
|
|
147,864 |
| Gross profit margin |
|
|
40.9% |
|
|
46.2% |
| Total operating expenses |
|
|
(111,356) |
|
|
(100,378) |
| Operating expenses as a % of Sales |
|
|
34.0% |
|
|
31.4% |
| Operating income |
|
|
22,481 |
|
|
47,486 |
| Operating margin |
|
|
6.9% |
|
|
14.8% |
| Interest expense, net |
|
|
(2,695) |
|
|
(3,035) |
| Other income (expense), net |
|
|
1,758 |
|
|
(226) |
| Income before income taxes |
|
|
21,544 |
|
|
44,225 |
| Provision for income taxes |
|
|
(10,473) |
|
|
(18,754) |
| Net income |
|
|
11,071 |
|
|
25,471 |
| Diluted EPS |
|
$ |
0.70 |
|
$ |
1.62 |
| |
|
|
|
|
| Diluted shares QTD |
|
|
15,919 |
|
|
15,717 |
| Diluted shares YTD |
|
|
15,839 |
|
|
15,675 |
| |
|
|
|
|
|
|
| CONSOLIDATED BALANCE SHEETS |
| (audited) |
| |
|
|
|
|
|
| |
|
March
31,
|
|
| (in thousands, except per share amounts) |
|
|
2017 |
|
|
|
2016 |
|
|
| ASSETS |
|
|
|
|
|
| Current assets: |
|
|
|
|
|
| Cash and cash equivalents |
|
$ |
23,146 |
|
|
$ |
25,987 |
|
|
| Bank time deposits |
|
|
1,776 |
|
|
|
13,278 |
|
|
| Accounts receivable, net |
|
|
63,782 |
|
|
|
52,637 |
|
|
| Inventories, net |
|
|
50,401 |
|
|
|
51,634 |
|
|
| Prepaid expenses and other current assets |
|
|
7,178 |
|
|
|
11,985 |
|
|
| Total current assets |
|
|
146,283 |
|
|
|
155,521 |
|
|
| Property, plant and equipment, net |
|
|
63,897 |
|
|
|
64,357 |
|
|
| Goodwill |
|
|
80,863 |
|
|
|
67,757 |
|
|
| Intangible assets, net |
|
|
90,610 |
|
|
|
88,727 |
|
|
| Other assets |
|
|
16,011 |
|
|
|
15,898 |
|
|
| Total assets |
|
$ |
397,664 |
|
|
$ |
392,260 |
|
|
| |
|
|
|
|
|
| LIABILITIES AND EQUITY |
|
|
|
|
|
| Current liabilities: |
|
|
|
|
|
| Accounts payable |
|
|
14,418 |
|
|
$ |
9,912 |
|
|
| Accrued and other current liabilities |
|
|
22,756 |
|
|
|
21,090 |
|
|
| Current portion of long-term debt |
|
|
561 |
|
|
|
561 |
|
|
| Total current liabilities |
|
|
37,735 |
|
|
|
31,563 |
|
|
| Long-term debt |
|
|
72,646 |
|
|
|
89,121 |
|
|
| Retirement benefits payable |
|
|
1,464 |
|
|
|
1,746 |
|
|
| Other long-term liabilities |
|
|
13,380 |
|
|
|
11,820 |
|
|
| Total liabilities |
|
|
125,225 |
|
|
|
134,250 |
|
|
| Equity: |
|
|
|
|
|
| Common shares, $0.01 par value |
|
|
157 |
|
|
|
156 |
|
|
| Shares authorized – 50,000 |
|
|
|
|
| Shares issued – 15,846 and 15,659, respectively |
|
|
|
|
| Preferred shares, $0.01 par value |
|
|
- |
|
|
|
- |
|
|
| Shares authorized – 10,000 |
|
|
|
|
|
| Shares issued – 0 |
|
|
|
|
|
| Additional paid-in capital |
|
|
38,701 |
|
|
|
31,597 |
|
|
| Treasury shares, at cost |
|
|
(1,011 |
) |
|
|
- |
|
|
| Retained earnings |
|
|
245,026 |
|
|
|
233,955 |
|
|
| Accumulated other comprehensive loss |
|
|
(10,435 |
) |
|
|
(7,698 |
) |
|
| Total equity |
|
|
272,438 |
|
|
|
258,010 |
|
|
| Total liabilities and equity |
|
$ |
397,663 |
|
|
$ |
392,260 |
|
|
| |
|
|
|
|
|
| |
| CONSOLIDATED STATEMENTS OF CASH
FLOWS |
| (audited) |
| |
| |
|
|
|
Fiscal Years Ended
March 31, |
|
|
| (amounts in thousands) |
|
|
2017 |
|
|
|
2016 |
|
|
|
2015 |
|
| Cash flows from operating activities: |
|
|
|
|
|
|
| Net income |
|
$ |
11,071 |
|
|
$ |
25,471 |
|
|
$ |
29,705 |
|
| Adjustments to reconcile net income to net cash provided by operating
activities: |
|
|
|
|
|
|
| Depreciation |
|
|
7,857 |
|
|
|
7,032 |
|
|
|
5,922 |
|
| Amortization of intangible and other assets |
|
|
7,939 |
|
|
|
7,129 |
|
|
|
4,593 |
|
| Provision for inventory reserves |
|
|
1,644 |
|
|
|
- |
|
|
|
- |
|
| Provision for doubtful accounts |
|
|
178 |
|
|
|
(282 |
) |
|
|
1,515 |
|
| Share-based and other executive compensation |
|
|
4,641 |
|
|
|
2,231 |
|
|
|
- |
|
| Acquisition-related non-cash gain |
|
|
(376 |
) |
|
|
(1,950 |
) |
|
|
- |
|
| Net loss (gain) on disposals of property, plant and equipment |
|
|
221 |
|
|
|
60 |
|
|
|
(1,627 |
) |
| Pension plan curtailment benefit |
|
|
- |
|
|
|
(8,020 |
) |
|
|
- |
|
| Net pension (benefit) expense |
|
|
(1,092 |
) |
|
|
3,506 |
|
|
|
3,392 |
|
| Impairment of assets |
|
|
4,115 |
|
|
|
- |
|
|
|
710 |
|
| Net deferred taxes |
|
|
528 |
|
|
|
7,262 |
|
|
|
(7,887 |
) |
| Changes in operating assets and liabilities: |
|
|
|
|
|
|
| Accounts receivable, net |
|
|
(5,762 |
) |
|
|
2,522 |
|
|
|
(37 |
) |
| Inventories |
|
|
(36 |
) |
|
|
5,056 |
|
|
|
(6,655 |
) |
| Prepaid expenses and other current assets |
|
|
1,132 |
|
|
|
(4,945 |
) |
|
|
4,351 |
|
| Other assets |
|
|
(115 |
) |
|
|
(3,275 |
) |
|
|
109 |
|
| Accounts payable and other current liabilities |
|
|
4,706 |
|
|
|
910 |
|
|
|
1,086 |
|
| Retirement benefits payable and other liabilities |
|
|
2,385 |
|
|
|
(1,177 |
) |
|
|
291 |
|
| Net cash provided by operating activities |
|
|
39,036 |
|
|
|
41,530 |
|
|
|
35,468 |
|
| Cash flows from investing activities: |
|
|
|
|
|
|
| Capital expenditures |
|
|
(9,369 |
) |
|
|
(11,053 |
) |
|
|
(8,672 |
) |
| Proceeds from sale of assets held for investment |
|
|
349 |
|
|
|
- |
|
|
|
3,494 |
|
| Proceeds from sale of assets |
|
|
263 |
|
|
|
46 |
|
|
|
6,393 |
|
| Net change in bank time deposits |
|
|
10,968 |
|
|
|
(1,978 |
) |
|
|
3,353 |
|
| Cash paid for acquisitions |
|
|
(28,179 |
) |
|
|
(97,236 |
) |
|
|
(7,193 |
) |
| Net cash provided by (used in) investing activities |
|
|
(25,968 |
) |
|
|
(110,221 |
) |
|
|
(2,625 |
) |
| Cash flows from financing activities: |
|
|
|
|
|
|
| Borrowings on lines of credit |
|
|
- |
|
|
|
81,000 |
|
|
|
12,229 |
|
| Repayments of lines of credit |
|
|
(561 |
) |
|
|
(94,561 |
) |
|
|
(30,622 |
) |
| Borrowings on revolving credit agreement |
|
|
30,000 |
|
|
|
98,040 |
|
|
|
- |
|
| Payments on revolving credit agreement |
|
|
(45,915 |
) |
|
|
(21,500 |
) |
|
|
- |
|
| Payments of deferred loan costs |
|
|
- |
|
|
|
(1,081 |
) |
|
|
- |
|
| Purchase of treasury shares |
|
|
(1,011 |
) |
|
|
- |
|
|
|
(206 |
) |
| Cash contribution from Capital Southwest |
|
|
- |
|
|
|
13,000 |
|
|
|
- |
|
| Proceeds from stock option activity |
|
|
2,169 |
|
|
|
96 |
|
|
|
- |
|
| Dividends paid to Capital Southwest |
|
|
- |
|
|
|
(300 |
) |
|
|
(8,294 |
) |
| Net cash (used in) provided by financing activities |
|
|
(15,318 |
) |
|
|
74,694 |
|
|
|
(26,893 |
) |
| Effect of exchange rate changes on cash and equivalents |
|
|
(591 |
) |
|
|
(464 |
) |
|
|
(913 |
) |
| Net change in cash and cash equivalents |
|
|
(2,841 |
) |
|
|
5,539 |
|
|
|
5,037 |
|
| Cash and cash equivalents, beginning of period |
|
|
25,987 |
|
|
|
20,448 |
|
|
|
15,411 |
|
| Cash and cash equivalents, end of period |
|
$ |
23,146 |
|
|
$ |
25,987 |
|
|
$ |
20,448 |
|
| |
|
|
|
|
|
|
Reconciliation of Non-GAAP Measures
| |
|
|
|
|
|
|
|
|
| Reconciliation of Operating Income to Adjusted Operating
Income |
|
|
|
|
|
|
|
|
| |
| |
(unaudited) |
|
| (in thousands) |
For the Three Months
Ended March 31, |
|
|
For the Year Ended
March 31, |
|
| |
|
2017 |
|
|
2016 |
|
|
|
2017 |
|
|
2016 |
|
|
| |
|
|
|
|
|
|
|
|
|
| GAAP Operating Income |
$ |
4,721 |
|
$ |
6,796 |
|
|
$ |
22,481 |
|
$ |
47,486 |
|
|
| |
|
|
|
|
|
|
|
|
|
| Adjusting items: |
|
|
|
|
|
|
|
|
|
| Pension gain |
|
- |
|
|
- |
|
|
|
- |
|
|
(8,020 |
) |
|
| Restructuring & realignment |
|
5,257 |
|
|
- |
|
|
|
9,964 |
|
|
- |
|
|
| Asset Impairment |
|
220 |
|
|
- |
|
|
|
3,234 |
|
|
- |
|
|
| Estimated reserve for excess inventory |
|
- |
|
|
- |
|
|
|
719 |
|
|
- |
|
|
| Transaction and integration costs |
|
431 |
|
|
487 |
|
|
|
431 |
|
|
2,128 |
|
|
| Spin related costs |
|
- |
|
|
684 |
|
|
|
- |
|
|
3,730 |
|
|
| Consulting projects |
|
509 |
|
|
- |
|
|
|
1,904 |
|
|
- |
|
|
| CFO Transition |
|
- |
|
|
- |
|
|
|
2,872 |
|
|
- |
|
|
| |
|
|
|
|
|
|
|
|
|
| Adjusted Operating Income |
$ |
11,138 |
|
$ |
7,967 |
|
|
$ |
41,604 |
|
$ |
45,324 |
|
|
| |
| Reconciliation of Net Income to Adjusted Net Income |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
| |
(unaudited) |
| (in thousands, except share data) |
For the Three Months
Ended March 31, |
|
|
For the Year Ended
March 31, |
| |
|
2017 |
|
|
2016 |
|
|
|
2017 |
|
|
2016 |
|
| |
|
|
|
|
|
|
|
|
| GAAP Net Income |
$ |
2,728 |
|
$ |
1,860 |
|
|
$ |
11,071 |
|
$ |
25,471 |
|
| |
|
|
|
|
|
|
|
|
| Adjusting items, net of tax: |
|
|
|
|
|
|
|
|
| Pension gain |
|
- |
|
|
- |
|
|
|
- |
|
|
(5,213 |
) |
| Restructuring & realignment |
|
3,401 |
|
|
- |
|
|
|
6,555 |
|
|
- |
|
| Asset Impairment |
|
142 |
|
|
- |
|
|
|
2,102 |
|
|
- |
|
| Estimated reserve for excess inventory |
|
- |
|
|
- |
|
|
|
467 |
|
|
- |
|
| Transaction and integration costs |
|
279 |
|
|
315 |
|
|
|
280 |
|
|
1,377 |
|
| Spin related costs |
|
- |
|
|
443 |
|
|
|
- |
|
|
2,413 |
|
| Consulting projects |
|
329 |
|
|
- |
|
|
|
1,238 |
|
|
- |
|
| CFO Transition |
|
- |
|
|
- |
|
|
|
1,867 |
|
|
- |
|
| Discrete Tax Provisions |
|
- |
|
|
2,953 |
|
|
|
3,073 |
|
|
2,953 |
|
| |
|
|
|
|
|
|
|
|
| Adjusted Net Income |
$ |
6,879 |
|
$ |
5,571 |
|
|
$ |
26,653 |
|
$ |
27,001 |
|
| |
|
|
|
|
|
|
|
|
| GAAP Diluted income per common share |
$ |
0.17 |
|
$ |
0.12 |
|
|
$ |
0.70 |
|
$ |
1.62 |
|
| |
|
|
|
|
|
|
|
|
| Adjusting items, per diluted common share: |
|
|
|
|
|
|
|
|
| Pension gain |
|
- |
|
|
- |
|
|
|
- |
|
|
(0.33 |
) |
| Restructuring & realignment |
|
0.21 |
|
|
- |
|
|
|
0.41 |
|
|
- |
|
| Asset Impairment |
|
0.01 |
|
|
- |
|
|
|
0.13 |
|
|
- |
|
| Estimated reserve for excess inventory |
|
- |
|
|
- |
|
|
|
0.03 |
|
|
- |
|
| Transaction and integration costs |
|
0.02 |
|
|
0.02 |
|
|
|
0.02 |
|
|
0.09 |
|
| Spin related costs |
|
- |
|
|
0.03 |
|
|
|
- |
|
|
0.14 |
|
| Consulting projects |
|
0.02 |
|
|
- |
|
|
|
0.08 |
|
|
- |
|
| CFO Transition |
|
- |
|
|
- |
|
|
|
0.12 |
|
|
- |
|
| Discrete Tax Provisions |
|
- |
|
|
0.18 |
|
|
|
0.19 |
|
|
0.20 |
|
| |
|
|
|
|
|
|
|
|
| Adjusted earnings per diluted common share |
$ |
0.43 |
|
$ |
0.35 |
|
|
$ |
1.68 |
|
$ |
1.72 |
|
| Weighted-average shares outstanding (in thousands) |
|
|
|
|
|
|
|
|
| Diluted |
|
15,919 |
|
|
15,717 |
|
|
|
15,839 |
|
|
15,675 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Reconciliation of Segment Operating Income to Adjusted Segment
Operating Income |
| |
| |
(unaudited) |
| (in thousands, except percentages) |
|
For the Three Months
Ended March 31, 2017 |
|
|
For the Three Months
Ended March 31, 2016 |
| |
|
Industrial
Products |
|
Coatings,
Sealants &
Adhesives |
|
Specialty
Chemicals |
|
Corporate
and Other |
|
Consolidated |
|
|
Industrial
Products |
|
Coatings,
Sealants &
Adhesives |
|
Specialty
Chemicals |
|
Corporate
and Other |
|
Consolidated |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
$ |
41,605 |
|
|
$ |
26,651 |
|
|
$ |
19,089 |
|
|
$ |
4 |
|
|
$ |
87,349 |
|
|
|
$ |
33,934 |
|
|
$ |
25,314 |
|
|
$ |
16,921 |
|
|
$ |
90 |
|
|
$ |
76,259 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating Income |
|
$ |
8,411 |
|
|
$ |
(59 |
) |
|
$ |
(817 |
) |
|
$ |
(2,814 |
) |
|
$ |
4,721 |
|
|
|
$ |
6,289 |
|
|
$ |
(63 |
) |
|
$ |
3,068 |
|
|
$ |
(2,498 |
) |
|
$ |
6,796 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Adjusting items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Restructuring & realignment |
|
|
624 |
|
|
|
1,803 |
|
|
|
2,830 |
|
|
|
(0 |
) |
|
|
5,257 |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
| Asset Impairment |
|
|
13 |
|
|
|
153 |
|
|
|
54 |
|
|
|
- |
|
|
|
220 |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
| Transaction and integration costs |
|
|
431 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
431 |
|
|
|
|
- |
|
|
|
487 |
|
|
|
- |
|
|
|
- |
|
|
|
487 |
|
| Spin related costs |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
684 |
|
|
|
684 |
|
| Consulting projects |
|
|
96 |
|
|
|
50 |
|
|
|
336 |
|
|
|
27 |
|
|
|
509 |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Adjusted Operating Income |
|
$ |
9,574 |
|
|
$ |
1,947 |
|
|
$ |
2,403 |
|
|
$ |
(2,787 |
) |
|
$ |
11,138 |
|
|
|
$ |
6,289 |
|
|
$ |
424 |
|
|
$ |
3,068 |
|
|
$ |
(1,814 |
) |
|
$ |
7,967 |
|
| % of revenue |
|
|
23.0 |
% |
|
|
7.3 |
% |
|
|
12.6 |
% |
|
|
|
|
12.8 |
% |
|
|
|
18.5 |
% |
|
|
1.7 |
% |
|
|
18.1 |
% |
|
|
|
|
10.4 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
(unaudited) |
| (in thousands, except percentages) |
|
For the Year Ended
March 31, 2017 |
|
|
For the Year Ended
December 31, 2016 |
| |
|
Industrial
Products |
|
Coatings,
Sealants & Adhesives |
|
Specialty
Chemicals |
|
Corporate
and Other |
|
Consolidated |
|
|
Industrial
Products |
|
Coatings,
Sealants & Adhesives |
|
Specialty
Chemicals |
|
Corporate
and Other |
|
Consolidated |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Revenue |
|
$ |
158,654 |
|
|
$ |
96,869 |
|
|
$ |
71,469 |
|
|
$ |
92 |
|
|
$ |
327,084 |
|
|
|
$ |
138,594 |
|
|
$ |
106,035 |
|
|
$ |
74,930 |
|
|
$ |
272 |
|
|
$ |
319,831 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating Income |
|
$ |
32,893 |
|
|
$ |
851 |
|
|
$ |
2,012 |
|
|
$ |
(13,275 |
) |
|
$ |
22,481 |
|
|
|
$ |
31,075 |
|
|
$ |
10,911 |
|
|
$ |
12,490 |
|
|
$ |
(6,990 |
) |
|
$ |
47,486 |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Adjusting items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Pension gain |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
(3,179 |
) |
|
|
(1,418 |
) |
|
|
(3,423 |
) |
|
|
- |
|
|
|
(8,020 |
) |
| Restructuring & realignment |
|
|
624 |
|
|
|
3,759 |
|
|
|
5,581 |
|
|
|
(0 |
) |
|
|
9,964 |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
| Asset Impairment |
|
|
227 |
|
|
|
2,953 |
|
|
|
54 |
|
|
|
(0 |
) |
|
|
3,234 |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
| Estimated reserve for excess inventory |
|
|
17 |
|
|
|
279 |
|
|
|
423 |
|
|
|
- |
|
|
|
719 |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
| Transaction and integration costs |
|
|
431 |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
431 |
|
|
|
|
- |
|
|
|
1,620 |
|
|
|
508 |
|
|
|
- |
|
|
|
2,128 |
|
| Spin related costs |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
3,730 |
|
|
|
3,730 |
|
| Consulting projects |
|
|
371 |
|
|
|
314 |
|
|
|
537 |
|
|
|
682 |
|
|
|
1,904 |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
| CFO Transition |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
2,872 |
|
|
|
2,872 |
|
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Adjusted Operating Income |
$ |
34,563 |
|
|
$ |
8,155 |
|
|
$ |
8,607 |
|
|
$ |
(9,721 |
) |
|
$ |
41,604 |
|
|
|
$ |
27,896 |
|
|
$ |
11,113 |
|
|
$ |
9,575 |
|
|
$ |
(3,260 |
) |
|
$ |
45,324 |
|
| % of revenue |
|
21.8 |
% |
|
|
8.4 |
% |
|
|
12.0 |
% |
|
|
|
|
12.7 |
% |
|
|
|
20.1 |
% |
|
|
10.5 |
% |
|
|
12.8 |
% |
|
|
|
|
14.2 |
% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
We use adjusted earnings per share, adjusted net income and adjusted operating income, together with financial measures prepared in
accordance with GAAP, such as revenue, income from operations, operating expense, operating income and net income, to asses our
historical and prospective operating performance and to enhance our understanding of our core operating performance. We also
believe these measures are useful for investors to assess the operating performance of our business without the effect of
non-operating items.
Investor contact: Michael Callahan, ICR (203) 682-8311 Michael.Callahan@icrinc.com
