RBC Bearings Incorporated (Nasdaq: ROLL), a leading
international manufacturer of highly-engineered precision bearings
and components for the industrial, defense and aerospace
industries, today reported results for the fourth quarter of fiscal
year 2015.
Fourth Quarter
Highlights
($ in millions)
Fiscal 2015
Fiscal 2014 Change
GAAP Adjusted (1) GAAP Adjusted (1)
GAAP Adjusted (1) Net sales $113.4
$113.4 $113.7 $113.7 -0.3% -0.3% Gross
margin $44.9 $44.9 $45.2 $45.2 -0.7% -0.7% Gross margin % 39.6%
39.6% 39.8% 39.8% Operating income $25.3 $25.4 $25.2 $25.2 0.6%
0.8% Operating income % 22.3% 22.4% 22.1% 22.1% Net income $14.9
$17.1 $18.2 $17.1 -18.0% 0.0% Diluted EPS $0.64 $0.73 $0.78 $0.73
-18.0% 0.0%
(1) Results exclude items in
reconciliation below.
Full Year
Highlights
($ in millions)
Fiscal 2015
Fiscal 2014
Change GAAP Adjusted (1) GAAP
Adjusted (1) GAAP Adjusted (1) Net sales $445.3
$445.3 $418.9 $418.9 6.3%
6.3% Gross margin $170.1 $173.8 $164.8 $164.8 3.2% 5.5% Gross
margin % 38.2% 39.0% 39.3% 39.3% Operating income $88.4 $96.5 $88.7
$90.7 -0.2% 6.4% Operating income % 19.9% 21.7% 21.2% 21.7% Net
income $58.2 $64.0 $60.2 $59.9 -3.3% 6.9% Diluted EPS $2.49 $2.74
$2.59 $2.58 -3.9% 6.2%
(1) Results exclude items in
reconciliation below.
“Our fourth quarter of fiscal 2015 capped a great year in which
we achieved record-level sales, operating income, and net income,”
said Dr. Michael J. Hartnett, Chairman and Chief Executive Officer.
“These results were driven by strong performance in our industrial
markets and our continued focus on execution. We are also pleased
to have recently announced the closing of our acquisition of the
Sargent Aerospace & Defense business of Dover Corporation.
Sargent is an excellent strategic fit for RBC Bearings that expands
and strengthens our offering, and we’re excited to continue to
enhance our growth and value creation potential through this
acquisition.”
Fourth Quarter Results
Net sales for the fourth quarter of fiscal 2015 were $113.4
million compared to $113.7 million in the fourth quarter of fiscal
2014. Industrial sales increased 0.1% offset by a decline of 0.5%
in aerospace and defense. Overall net sales for the quarter were
negatively impacted by $1.0 million due to foreign exchange.
Excluding the foreign exchange impact, industrial sales increased
0.9% and aerospace and defense increased 0.3%. Gross margin for the
fourth quarter was $44.9 million compared to $45.2 million for the
same period last year. Gross margin as a percentage of net sales
was 39.6% in the fourth quarter of fiscal 2015 compared to 39.8%
for the same period last year.
SG&A for the fourth quarter of fiscal 2015 was $19.1
million, a decrease of $0.5 million from $19.6 million for the same
period last year. As a percentage of net sales, SG&A was 16.9%
for the fourth quarter of fiscal 2015 compared to 17.2% for the
same period last year.
Other operating expenses for the fourth quarter of fiscal 2015
totaled $0.5 million compared to $0.5 million for the same period
last year. For both the fourth quarter of fiscal 2015 and 2014
other operating expenses consisted mainly of amortization of
intangibles.
Operating income for the fourth quarter of fiscal 2015 was $25.3
million compared to operating income of $25.2 million for the same
period last year. Excluding costs associated with acquisition
activity, operating income would have been $25.4 million for the
fourth quarter of fiscal 2015 compared to $25.2 million for the
same period last year. Excluding these adjustments, operating
income as a percentage of net sales would have been 22.4% compared
to 22.1% for the same period last year.
Interest expense, net was $0.2 million for both the fourth
quarter of fiscal 2015 and the same period last year.
Other non-operating expense for the fourth quarter of fiscal
2015 was $3.2 million. This was mainly comprised of $3.1 million
associated with the translation and re-measurement of
non-functional Euro currency on our Swiss balance sheet.
Income tax expense for the fourth quarter of fiscal 2015 was
$7.0 million compared to $6.7 million for the same period last
year. Our effective income tax rate for the fourth quarter of
fiscal 2015 was 31.9% compared to 26.9% for the same period last
year. The effective income tax rate for the fourth quarter of
fiscal 2015 includes discrete tax benefits of $0.4 million compared
to $1.1 million for the same period last year. The effective income
tax rate without the discrete tax benefits would have been 34.6%
compared to 31.1% for the same period last year.
Net income for the fourth quarter of fiscal 2015 was $14.9
million compared to $18.2 million for the same period last year.
Excluding the after tax impact of costs associated with acquisition
activity, foreign exchange translation losses, and the discrete tax
benefits, net income would have been $17.1 million for the fourth
quarter of fiscal 2015, compared to adjusted net income of $17.1
million for the same period last year.
Diluted EPS for the fourth quarter of fiscal 2015 was 64 cents
per share compared to 78 cents per share for the same period last
year. Excluding the after tax impact of costs associated with
acquisition activity, foreign exchange losses, and the discrete tax
benefits, diluted EPS for the fourth quarter of fiscal 2015 would
have been 73 cents per share compared to adjusted diluted EPS of 73
cents per share for the same period last year.
Foreign Exchange Translation
Impact
On January 15, 2015, the Swiss National Bank, removed its
three-year-old foreign exchange cap of Swiss Franc 1.20 against the
Euro. The exchange rate at the end of March was approximately 1.02.
This change in rates has impacted the translation and
re-measurement of the financial statements of our Swiss company,
Schaublin S.A. Schaublin S.A. had approximately 16.0 million Euro
deposits on their balance sheet. When these Euro deposits are
re-measured to the functional currency Swiss Francs, the change in
exchange rate is reflected in the income statement in Other
Non-Operating Expense. Based on the exchange rate at the end of
March, the income statement had a negative impact of approximately
$2.5 million after tax on the consolidated income statement in the
fourth quarter.
Live Webcast
RBC Bearings Incorporated will host a webcast at 11:00 a.m. ET
today to discuss the quarterly results. To access the webcast, go
to the investor relations portion of the Company’s website,
www.rbcbearings.com, and click on the webcast icon. If you do not
have access to the Internet and wish to listen to the call, dial
877-415-3181 (international callers dial 857-244-7324) and enter
conference ID # 85124064. An audio replay of the call will be
available from 3:00 p.m. ET May 27, 2015 until 11:59 p.m. ET June
3, 2015. The replay can be accessed by dialing 888-286-8010
(international callers dial 617-801-6888) and entering conference
call ID # 94247477. Investors are advised to dial into the call at
least ten minutes prior to the call to register.
Non-GAAP Financial
Measures
In addition to disclosing results of operations that are
determined in accordance with generally accepted accounting
principles (“GAAP”), this press release also discloses non-GAAP
results of operations that exclude certain items. These non-GAAP
measures adjust for items that Management believes are unusual.
Management believes that the presentation of these non-GAAP
measures provides useful information to investors regarding the
Company’s results of operations, as these non-GAAP measures allow
investors to better evaluate ongoing business performance.
Investors should consider non-GAAP measures in addition to, not as
a substitute for, financial measures prepared in accordance with
GAAP. A reconciliation of the non-GAAP measures disclosed in the
press release with the most comparable GAAP measures are included
in the financial table attached to this press release.
About RBC Bearings
RBC Bearings Incorporated is an international manufacturer and
marketer of highly engineered precision bearings and components.
Founded in 1919, the Company is primarily focused on producing
highly technical or regulated bearing products requiring
sophisticated design, testing, and manufacturing capabilities for
the diversified industrial, aerospace, and defense markets. The
Company is headquartered in Oxford, Connecticut.
Safe Harbor for Forward Looking
Statements
Certain statements in this press release contain
“forward-looking statements.” All statements other than statements
of historical fact are “forward-looking statements” for purposes of
federal and state securities laws, including the section of this
press release entitled “Outlook”; any projections of earnings,
revenue or other financial items relating to the Company, any
statement of the plans, strategies and objectives of management for
future operations; any statements concerning proposed future growth
rates in the markets we serve; any statements of belief; any
characterization of and the Company’s ability to control contingent
liabilities; anticipated trends in the Company’s businesses; and
any statements of assumptions underlying any of the foregoing.
Forward-looking statements may include the words “may,” “estimate,”
“intend,” “continue,” “believe,” “expect,” “anticipate,” and other
similar words. Although the Company believes that the expectations
reflected in any forward-looking statements are reasonable, actual
results could differ materially from those projected or assumed in
any of our forward-looking statements. Our future financial
condition and results of operations, as well as any forward-looking
statements, are subject to change and to inherent risks and
uncertainties beyond the control of the Company. These risks and
uncertainties include, but are not limited to, risks and
uncertainties relating to general economic conditions, geopolitical
factors, future levels of general industrial manufacturing
activity, future financial performance, market acceptance of new or
enhanced versions of the Company’s products, the pricing of raw
materials, changes in the competitive environments in which the
Company’s businesses operate, the outcome of pending or future
litigation and governmental proceedings and approvals, estimated
legal costs, increases in interest rates, the Company’s ability to
meet its debt obligations, and risks and uncertainties listed or
disclosed in the Company’s reports filed with the Securities and
Exchange Commission, including, without limitation, the risks
identified under the heading “Risk Factors” set forth in the
Company’s most recent Annual Report filed on Form 10-K. The Company
does not intend, and undertakes no obligation, to update or alter
any forward-looking statements.
RBC Bearings Incorporated Consolidated Statements
of Operations (dollars in thousands, except share and per
share data) (Unaudited)
Three Months
Ended Twelve Months Ended March 28, March
29, March 28, March 29, 2015
2014 2015
2014 Net sales $ 113,417 $ 113,718 $ 445,278 $
418,886 Cost of sales 68,502 68,477
275,138 254,089 Gross margin 44,915
45,241 170,140 164,797 Operating expenses: Selling, general
and administrative 19,129 19,572 75,908 71,969 Other, net
453 490 5,802 4,178
Total operating expenses 19,582 20,062 81,710 76,147
Operating income 25,333 25,179 88,430 88,650 Interest
expense, net 235 249 1,055 1,019 Other non-operating (income)
expense 3,176 42 2,820
(122 ) Income before income taxes 21,922 24,888 84,555
87,753 Provision for income taxes 6,993 6,685
26,307 27,545 Net income $
14,929 $ 18,203 $ 58,248 $ 60,208
Net income per common share: Basic $ 0.65 $ 0.79 $ 2.52 $
2.63 Diluted $ 0.64 $ 0.78 $ 2.49 $ 2.59 Weighted average
common shares: Basic 23,122,167 22,976,336 23,073,940 22,874,842
Diluted 23,434,502 23,359,817 23,385,061 23,244,241
Dividends per share: $ - $ - $ 2.00 $ -
Three Months Ended Twelve Months Ended
Reconciliation of Reported Gross Margin to March 28,
March 29, March 28, March 29, Adjusted
Gross Margin: 2015 2014
2015 2014
Reported gross margin $ 44,915
$ 45,241 $ 170,140
$ 164,797 Consolidation and restructuring - -
3,707 - Adjusted gross margin $
44,915 $ 45,241 $ 173,847 $ 164,797
Three Months Ended
Twelve Months Ended Reconciliation of Reported Operating
Income to March 28, March 29, March 28,
March 29, Adjusted Operating Income:
2015 2014 2015
2014 Reported operating income $
25,333
$ 25,179 $ 88,430
$ 88,650 Consolidation and restructuring - - 6,470 1,498 Costs
associated with acquisitions 60 - 1,587 501 Fixed asset disposals
- - - 43
Adjusted operating income $ 25,393 $ 25,179 $ 96,487
$ 90,692
Reconciliation of Reported Net Income and Net Income
Three Months Ended Twelve Months Ended Per Common
Share to Adjusted Net Income and March 28, March
29, March 28, March 29, Adjusted Net Income
Per Common Share: 2015 2014
2015 2014
Reported net income $ 14,929
$ 18,203 $ 58,248
$ 60,208 Consolidation and restructuring (1) - - 3,309 987 Costs
associated with acquisitions (1) 39 - 1,051 328 Fixed asset
disposals (1) - - - 28 Foreign exchange translation loss (1) 2,496
- 2,496 - Discrete tax benefit (410 ) (1,054 )
(1,108 ) (1,659 ) Adjusted net income $ 17,054 $
17,149 $ 63,996 $ 59,892 (1) After tax impact.
Adjusted net income per common share: Basic $ 0.74 $ 0.75 $
2.77 $ 2.62 Diluted $ 0.73 $ 0.73 $ 2.74 $ 2.58 Weighted
average common shares: Basic 23,122,167 22,976,336 23,073,940
22,874,842 Diluted 23,434,502 23,359,817 23,385,061 23,244,241
Dividends per share: $ - $ - $ 2.00 $ -
Three Months Ended Twelve Months Ended March
28, March 29, March 28, March 29,
Segment Data, Net External Sales: 2015
2014 2015
2014 Plain bearings segment $ 59,067 $ 60,190
$ 230,168 $ 223,099 Roller bearings segment 32,075 29,895 128,702
115,806 Ball bearings segment 14,788 15,846 56,464 49,555 Other
segment 7,487 7,787 29,944
30,426 $ 113,417 $ 113,718 $
445,278 $ 418,886
Three Months Ended Twelve Months Ended March
28, March 29, March 28, March 29,
Selected Financial Data: 2015
2014 2015 2014
Depreciation and amortization $ 3,200 $ 3,679 $
15,045 $ 14,987 Incentive stock compensation expense $ 2,108
$ 1,534 $ 8,339 $ 5,834 Cash provided by operating
activities $ 9,385 $ 12,010 $ 71,790 $ 47,975 Capital
expenditures $ 5,027 $ 6,298 $ 20,897 $ 28,920 Total debt $
9,198 $ 10,447 Cash and short-term investments $ 125,455 $
123,626 Cash dividends paid to shareholders $ 46,014 $ -
Repurchase of common stock $ 7,060 $ 1,788 Backlog $
209,550 $ 218,388
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version on businesswire.com: http://www.businesswire.com/news/home/20150527005165/en/
RBC BearingsDaniel A. Bergeron,
203-267-5028dbergeron@rbcbearings.comorAlpha IR GroupMichael
Cummings, 617-982-0475investors@rbcbearings.com
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