Diluted EPS of $0.91 from continuing
operations, up 30% versus $0.70 in prior year
Adjusted diluted EPS of $1.09 from
continuing operations, up 18% versus $0.92 in prior year
First Quarter Highlights
- Record first quarter sales of $1.9
billion, up 4.4% with growth in all segments and
geographies
- Organic sales increased 5.6% on a
per day basis, the strongest growth since 4Q 2014
- Debt-to-capital ratio further
improved, returning to target range of 45 - 50%
Anixter International Inc. (NYSE: AXE) today reported sales of
$1.9 billion for the quarter ended March 31, 2017, a 4.4% increase
compared to the prior year quarter. Organic sales increased 4.0%
year-over-year, excluding the impact of the following items:
- $14.9 million favorable impact from the
higher average price of copper
- $8.3 million unfavorable impact from
the fluctuation in foreign currencies
The current quarter had 64 billing days, compared to 65 billing
days in the first quarter of 2016. Excluding the unfavorable impact
from one less billing day, organic sales increased 5.6% versus
prior year.
All commentary in this release reflects results from continuing
operations unless otherwise noted. Please refer to the tables at
the end of this release for the reconciliations from our reported
results prepared in accordance with U.S. GAAP to the non-GAAP
measures.
Net income of $30.9 million includes amortization of intangible
assets expense of $9.0 million pre-tax and $6.1 million
after-tax. Net income of $23.2 million in the first quarter of
2016 includes amortization of intangible assets and acquisition and
integration costs which together had an $11.9 million pre-tax and
$7.4 million after-tax impact.
Excluding the impact of the above items, first quarter 2017
adjusted net income of $37.0 million compares to $30.6 million in
the prior year quarter, a 20.7% increase.
Diluted earnings per share of $0.91 compares to $0.70, and
adjusted diluted earnings per share of $1.09 compares to $0.92,
both versus the prior year quarter.
Adjusted EBITDA increased 7.5% to $89.5 million, or 4.7% of
sales, compared to prior year adjusted EBITDA of $83.3 million, or
4.6% of sales.
"First quarter 2017 year-over-year organic sales growth of 5.6%
on a per day basis was our strongest sales growth since the fourth
quarter of 2014, as our business continues to benefit from synergy
initiatives and a slowly recovering industrial economy. We were
pleased to deliver organic growth in all 3 segments and all 3
geographies, including 19.3% growth on an organic, per day basis in
our EMEA geography," commented Bob Eck, President and CEO. "Sales
in our Network & Security Solutions segment increased by 5.8%,
marking 14 consecutive quarters of sales growth, while our
Electrical and Electronic Solutions segment delivered 4.0% growth
and our Utility Power Solutions segment delivered strong 7.4%
growth, each year-over-year on an organic, per day basis."
Income Statement Detail
Gross margin of 20.0% compares to 20.4% in both the prior year
quarter and the fourth quarter of 2016. The majority of the change
versus both prior periods was driven by customer mix combined with
segment mix.
Operating expense of $310.7 million, or 16.4% of sales, compares
to prior year operating expense of $310.5 million, or 17.1% of
sales. Excluding current quarter expense of $9.0 million and first
quarter 2016 expense of $11.9 million, as detailed above, first
quarter 2017 adjusted operating expense of $301.7 million compared
to $298.6 million in the prior year quarter. Current quarter
adjusted operating expense of 15.9% of sales compared to 16.4% of
sales in the first quarter of 2016, driven primarily by expense
reduction initiatives and leveraging growth in the business.
Operating income of $69.0 million, or 3.6% of sales, compares to
$60.3 million, or 3.3% of sales, in the prior year quarter.
Excluding operating expense items outlined above, first quarter
2017 adjusted operating income increased 8.0% to $78.0 million
compared to $72.2 million in the first quarter of 2016. Adjusted
operating margin increased 10 basis points to 4.1% compared to 4.0%
in the prior year quarter.
Interest expense of $18.9 million compares to $20.1 million in
the prior year quarter, reflecting our focus on decreasing debt
with the strong cash flow we continue to generate. Foreign exchange
and other expense of $0.2 million compares to $2.8 million in the
prior year quarter.
Our first quarter 2017 U.S. GAAP effective tax rate was 38.1%
versus 37.9% in the first quarter of 2016 and our non-GAAP rate of
37.2% in the current quarter compared to 37.9% in the first quarter
of 2016, driven primarily by the country mix of earnings.
Segment Update
Network & Security Solutions ("NSS") sales of $984.9
million increased by 3.8% over the prior year period, driven by
broad-based growth in the business. Adjusting for the $3.9 million
unfavorable impact from foreign exchange, NSS organic sales
increased 4.2%, a 5.8% increase on a per day basis.
First quarter NSS security sales of $398.4 million, which
represents approximately 40% of segment sales, increased 2.2% from
the prior year quarter. Adjusted for the $1.8 million negative
currency impact, organic security sales growth was 2.7%.
NSS operating income of $61.8 million compares to $58.8 million
in the first quarter of 2016 and $77.2 million in the fourth
quarter of 2016. NSS adjusted EBITDA of $66.6 million increased
4.3% versus the first quarter of 2016. The corresponding adjusted
EBITDA margin of 6.8% compares to 6.7% in the prior year quarter
and 7.9% in the fourth quarter of 2016.
Electrical & Electronic Solutions (“EES”) sales of
$527.4 million compares to $506.0 million in the prior year period,
an increase of 4.2%. Adjusted for the $5.7 million unfavorable
impact from foreign exchange and the $14.7 million favorable impact
from higher average copper prices, EES organic sales increased
2.4%, a 4.0% increase on a per day basis, driven by synergies and
the slowly recovering industrial economy.
EES operating income of $27.9 million compares to $22.5 million
in the prior year quarter and $22.4 million in the fourth quarter
of 2016. The 23.8% increase in operating income versus prior year
was driven by strong sales growth, combined with ongoing expense
discipline, resulting in improved profitability in the
business.
EES adjusted EBITDA of $30.4 million increased 19.7%, from $25.4
million in the prior year period, and compares to $25.6 million in
the fourth quarter of 2016. The corresponding current quarter
adjusted EBITDA margin of 5.8% compares to 5.0% in the prior year
period and 5.1% in the fourth quarter of 2016.
Utility Power Solutions (“UPS”) sales of $383.5 million
compares to $361.1 million in the prior year period, an increase of
6.2%. Adjusted for the $1.3 million favorable impact from foreign
exchange and the $0.2 million favorable impact from higher average
copper prices, UPS organic sales increased 5.8%, a 7.4% increase on
an organic per day basis, driven by synergistic sales to service a
new investor-owned utility customer.
UPS operating income of $16.2 million compares to $14.3 million
in the prior year quarter and $14.6 million in the fourth quarter
of 2016. The 13.9% increase in operating income versus prior year
was driven by strong sales growth combined with ongoing expense
discipline.
UPS adjusted EBITDA of $20.9 million compares to $20.1 million
in the prior year quarter and $19.2 million in the fourth quarter
of 2016. The corresponding adjusted EBITDA margin of 5.5% compares
to 5.6% in the prior year quarter and 5.5% in the fourth quarter of
2016.
Cash Flow and Leverage
We generated $51.5 million in cash flow from operations in the
first quarter of 2017, which compares to $65.2 million in the first
quarter of 2016. The decrease reflects higher working capital
investment to support an acceleration in sales growth, partially
offset by stronger earnings. We are increasing our estimate of full
year 2017 cash flow from operations to the range of $200 - $220
million. In the first quarter of 2017 we invested $8.6 million in
capital expenditures, which compares to $7.0 million in the prior
year period. For the full year we expect to invest $40 - $50
million in capital expenditures.
"Our solid financial performance, as highlighted by a 7.5%
increase in adjusted EBITDA on a 4.4% increase in sales,
underscores the operating leverage of our business. Meanwhile we
remain focused on our strategic initiatives, including delivering
on our synergy goals, continuing to improve our cost structure and
working capital efficiency," commented Ted Dosch, Executive
Vice President - Finance and CFO. "We were pleased to deliver
another quarter of strong cash flow from operations, enabling us to
further reduce our debt. Turning to our capital structure, the
strong free cash flow we are generating from our repositioned
platform and working capital initiatives has enabled us to return
our debt-to-capital ratio to our target range of 45 - 50% in the
first quarter of 2017, ahead of our second half of 2017 target. We
remain on track to return our debt-to-adjusted EBITDA ratio to our
target range of 2.5 - 3.0 times by the end of the year."
Key capital structure and credit-related statistics for the
quarter:
- Debt-to-total capital ratio improved to
49.9% from 51.6% at the end of 2016
- Weighted average cost of borrowed
capital of 5.2% compares to 4.7% in the prior year quarter
- $571.4 million available under
revolving lines of credit and secured accounts receivable and
inventory facilities
Business Outlook
"We were pleased with our sales momentum in the first quarter,
which reflected a slowly improving economic environment and solid
execution of our growth initiatives. As we enter the second quarter
of 2017, we are cautiously optimistic that the positive momentum we
experienced in the quarter will continue, as we maintain our focus
on our growth initiatives which include synergistic sales and
global accounts," commented Bob Eck. "Together with our current
sales and backlog trends, and our conservative view of the macro
environment, we expect second quarter 2017 organic sales growth in
the 1.5 - 3% range. For the full year 2017 we have increased the
midpoint of our outlook range by 100 basis points, and now expect
full year organic sales growth in the 2 - 5% range."
Financial Results from Continuing
Operations
Three Months Ended March 31,
April 1, Percent (In millions, except per
share amounts)
2017 2016 Change Net Sales $
1,895.8 $ 1,816.2 4 % Operating Income $ 69.0 $ 60.3 14 % Net
Income $ 30.9 $ 23.2 33 % Diluted Earnings Per Share $ 0.91 $ 0.70
30 % Diluted Weighted Shares 33.9 33.4 2 % nm - not
meaningful
First Quarter Earnings Call
Details
We will host a conference call to discuss these results
beginning at 9:30 a.m. Central Time today. The call will be
available as a live audio webcast and can be accessed at the
Investor Relations portion of our website at anixter.com/investor.
Dial-in numbers for the call are as follows:
U.S./Canada toll-free dial-in: (877) 201-0168 International
dial-in: (647) 788-4901 Conference ID: 9755 2427
A replay of the call will be available at anixter.com/investor
for 15 days following the call. Prior to the beginning of the call
a supplemental presentation titled “First Quarter 2017 Highlights
and Operating Review” will be available on the Investor Relations
section of our website.
About Anixter
Anixter International is a leading global distributor of Network
& Security Solutions, Electrical & Electronic Solutions and
Utility Power Solutions. We help build, connect, protect, and power
valuable assets and critical infrastructures. From enterprise
networks to industrial MRO supply to video surveillance
applications to electric power distribution, we offer full-line
solutions, and intelligence, that create reliable, resilient
systems that sustain businesses and communities. Through our
unmatched global distribution network along with our supply
chain and technical expertise, we help lower the cost, risk
and complexity of our customers’ supply chains.
Anixter adds value to the distribution process by providing our
customers access to 1) innovative supply chain solutions, 2) nearly
600,000 products and over $1.0 billion in inventory, 3) over 300
warehouses/branch locations with approximately 9.0 million square
feet of space and 4) locations in over 300 cities in approximately
50 countries. Founded in 1957 and headquartered near Chicago,
Anixter trades on the New York Stock Exchange under the symbol
AXE.
Safe Harbor Statement
The statements in this release other than historical facts are
forward-looking statements made in reliance upon the safe harbor of
the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are subject to a number of factors that
could cause our actual results to differ materially from what is
indicated here. These factors include but are not limited to
general economic conditions, the level of customer demand
particularly for capital projects in the markets we serve, changes
in supplier relationships or in supplier sales strategies or
financial viability, risks associated with the sale of
nonconforming products and services, political, economic or
currency risks related to foreign operations, inventory
obsolescence, copper price fluctuations, customer viability, risks
associated with accounts receivable, the impact of regulation and
regulatory, investigative and legal proceedings and legal
compliance risks, information security risks, risks associated with
substantial debt and restrictions contained in financial and
operating covenants in our debt agreements, the impact and the
uncertainty concerning the timing and terms of the withdrawal by
the United Kingdom from the European Union, and risks associated
with integration of acquired companies, including, but not limited
to, the risk that the acquisitions may not provide us with the
synergies or other benefits that were anticipated. These
uncertainties may cause our actual results to be materially
different than those expressed in any forward looking statements.
We do not undertake to update any forward looking statements.
Please see our Securities and Exchange Commission (“SEC”) filings
for more information.
Non-GAAP Financial Measures
In addition to the results provided in accordance with U.S.
Generally Accepted Accounting Principles (“U.S. GAAP”) above, this
release includes certain financial measures computed using non-GAAP
components as defined by the SEC. Specifically, net sales
comparisons to the prior corresponding period, both worldwide and
in relevant segments, are discussed in this release both on an U.S.
GAAP and non-GAAP basis. We believe that by providing non-GAAP
organic growth, which adjusts for the impact of acquisitions (when
applicable), foreign exchange fluctuations, copper prices and the
number of billing days, both management and investors are provided
with meaningful supplemental sales information to understand and
analyze our underlying trends and other aspects of our financial
performance. Historically and from time to time, we may also
exclude other items from reported financial results (e.g.,
impairment charges, inventory adjustments, restructuring charges,
tax items, currency devaluations, pension settlements, etc.) in
presenting adjusted operating expense, adjusted operating income,
adjusted income taxes and adjusted net income so that both
management and financial statement users can use these non-GAAP
financial measures to better understand and evaluate our
performance period over period and to analyze the underlying trends
of our business. As a result of the recent acquisitions we have
also excluded amortization of intangible assets associated with
purchase accounting from acquisitions from the adjusted amounts for
comparison of the non-GAAP financial measures period over
period.
EBITDA is defined as net income from continuing operations
before interest, income taxes, depreciation and amortization.
Adjusted EBITDA is defined as EBITDA before foreign exchange and
other non-operating expense and non-cash stock-based compensation,
excluding the other items from reported financial results, as
defined above. Adjusted EBITDA leverage is defined as the
percentage change in Adjusted EBITDA divided by the percentage
change in net sales. We believe that adjusted operating income,
EBITDA, Adjusted EBITDA and Adjusted EBITDA leverage provide
relevant and useful information, which is widely used by analysts,
investors and competitors in our industry as well as by our
management in assessing both consolidated and business segment
performance. Adjusted operating income provides an understanding of
the results from the primary operations of our business by
excluding the effects of certain items that do not reflect the
ordinary earnings of our operations. We use adjusted operating
income to evaluate our period-over-period operating performance
because we believe this provides a more comparable measure of our
continuing business excluding certain items that are not reflective
of expected ongoing operations. This measure may be useful to an
investor in evaluating the underlying performance of our business.
EBITDA provides us with an understanding of earnings before the
impact of investing and financing charges and income taxes.
Adjusted EBITDA further excludes the effects of foreign exchange
and other non-cash stock-based compensation, and certain items that
do not reflect the ordinary earnings of our operations and that are
also excluded for purposes of calculating adjusted net income,
adjusted earnings per share and adjusted operating income. EBITDA
and Adjusted EBITDA are used by our management for various purposes
including as measures of performance of our operating segments and
as a basis for strategic planning and forecasting. Adjusted EBITDA
and Adjusted EBITDA leverage may be useful to an investor because
this measure is widely used to evaluate a company’s operating
performance without regard to items excluded from the calculation
of such measure, which can vary substantially from company to
company depending on the accounting methods, book value of assets,
capital structure and the method by which the assets were acquired,
among other factors. They are not, however, intended as an
alternative measure of operating results or cash flow from
operations as determined in accordance with generally accepted
accounting principles.
Non-GAAP financial measures provide insight into selected
financial information and should be evaluated in the context in
which they are presented. These non-GAAP financial measures have
limitations as analytical tools, and should not be considered in
isolation from, or as a substitute for, financial information
presented in compliance with U.S. GAAP, and non-GAAP financial
measures as reported by us may not be comparable to similarly
titled amounts reported by other companies. The non-GAAP financial
measures should be considered in conjunction with the Condensed
Consolidated Financial Statements, including the related notes, and
Management’s Discussion and Analysis of Financial Condition and
Results of Operations included in this release. Management does not
use these non-GAAP financial measures for any purpose other than
the reasons stated above.
Additional information about Anixter is
available at anixter.com
ANIXTER INTERNATIONAL INC. Condensed Consolidated
Statements of Operations (Unaudited) Three
Months Ended
March 31, 2017
April 1, 2016
(In millions, except per share amounts) Net sales
$ 1,895.8 $ 1,816.2 Cost of goods sold
1,516.1 1,445.4
Gross profit 379.7
370.8 Operating expenses 310.7 310.5
Operating income 69.0 60.3 Other expense:
Interest expense (18.9 ) (20.1 ) Other, net (0.2 ) (2.8 ) Income
from continuing operations before income taxes 49.9 37.4 Income tax
expense from continuing operations 19.0 14.2
Net
income from continuing operations 30.9 23.2 Loss
from discontinued operations before income taxes — (0.7 ) Income
tax benefit from discontinued operations — (0.3 )
Net
loss from discontinued operations — (0.4
) Net income $ 30.9 $
22.8 Income (loss) per share: Basic:
Continuing operations $ 0.92 $ 0.70 Discontinued operations —
(0.01 )
Net Income $ 0.92
$ 0.69 Diluted: Continuing operations $
0.91 $ 0.70 Discontinued operations — (0.02 )
Net
Income $ 0.91 $ 0.68
Weighted-average common shares outstanding: Basic
33.5 33.3 Diluted 33.9 33.4
Reportable Segments
Net sales: Network & Security Solutions $ 984.9 $ 949.1
Electrical & Electronic Solutions 527.4 506.0 Utility Power
Solutions 383.5 361.1 $ 1,895.8 $ 1,816.2
Operating income: Network & Security Solutions $
61.8 $ 58.8 Electrical & Electronic Solutions 27.9 22.5 Utility
Power Solutions 16.2 14.3 Corporate (36.9 ) (35.3 ) $ 69.0 $
60.3
ANIXTER INTERNATIONAL INC. Condensed
Consolidated Balance Sheets (Unaudited)
March 31, 2017
December 30, 2016
(In millions) ASSETS Current assets:
Cash and cash equivalents $ 118.2 $ 115.1 Accounts receivable, net
1,320.2 1,353.2 Inventories 1,156.0 1,178.3 Other current assets
43.0 41.9 Total current assets 2,637.4 2,688.5
Property and equipment, net 142.1 140.3 Goodwill 767.2 764.6
Intangible assets, net 407.3 415.4 Other assets 86.2 84.8
Total assets $ 4,040.2 $
4,093.6 LIABILITIES AND STOCKHOLDERS'
EQUITY Current liabilities: Accounts payable $ 980.6 $
1,006.0 Accrued expenses 222.2 257.9 Total current
liabilities 1,202.8 1,263.9 5.50% Senior notes due 2023 346.4 346.3
5.125% Senior notes due 2021 395.9 395.7 5.625% Senior notes due
2019 347.9 347.7 Canadian term loan 81.6 95.4 Revolving lines of
credit 170.0 197.1 Other 2.2 3.5 Unamortized debt issuance costs
(6.4 ) (6.9 ) Other liabilities 157.2 158.7
Total
liabilities 2,697.6 2,801.4 Total
stockholders' equity 1,342.6 1,292.2
Total liabilities and stockholders' equity $
4,040.2 $ 4,093.6
ANIXTER INTERNATIONAL INC. Condensed Consolidated
Statements of Cash Flows (Unaudited) Three
Months Ended March 31, 2017 April 1, 2016 (In
millions) Operating activities: Net income $ 30.9
$ 22.8 Adjustments to reconcile net income to net cash provided by
operating activities: Depreciation 7.0 7.0 Amortization of
intangible assets 9.0 9.7 Stock-based compensation 4.5 4.1 Deferred
income taxes 0.4 0.5 Accretion of debt discount 0.5 0.5
Amortization of deferred financing costs 0.5 0.5 Pension plan
contributions (4.5 ) (4.6 ) Pension plan expenses 2.6 2.7 Changes
in current assets and liabilities, net 1.8 26.3 Other, net (1.2 )
(4.3 )
Net cash provided by operating activities 51.5
65.2 Investing activities: Capital expenditures, net
(8.6 ) (7.0 )
Net cash used in investing activities
(8.6 ) (7.0 ) Financing
activities: Proceeds from borrowings 435.0 359.1 Repayments of
borrowings (463.6 ) (450.6 ) Repayments of Canadian term loan (15.0
) — Proceeds from stock options exercised 1.8 — Other, net (0.2 ) —
Net cash used in financing activities (42.0
) (91.5 ) Increase (decrease) in cash and
cash equivalents 0.9 (33.3 ) Effect of
exchange rate changes on cash balances 2.2 (2.7
) Cash and cash equivalents at beginning of period 115.1
151.3
Cash and cash equivalents at end of
period $ 118.2 $ 115.3
ANIXTER INTERNATIONAL INC. Financial
Measures That Supplement U.S. GAAP (Unaudited)
First Quarter
2017 Sales Growth Trends Q1 2017 Q1
2016 (In millions)
AsReported
Foreign Exchange
Impact
Copper Impact
AsAdjusted AsReported
Organic Growth/
(Decline)
Adjusted 2016 for Extra
Day
Adjusted Per Day
Organic Growth/(Decline)
Network & Security Solutions North America $ 768.0 $
(2.4 ) $ — $ 765.6 $ 748.0 2.4 % $ 736.5 4.0 % EMEA 92.9 4.1 — 97.0
81.4 19.3 % 80.1 21.2 % Emerging Markets 124.0 2.2 —
126.2 119.7 5.4 % 117.9 7.0 %
NSS $ 984.9 $ 3.9
$ — $ 988.8 $
949.1 4.2 % $ 934.5
5.8 % Electrical & Electronic
Solutions North America $ 416.2 $ (1.7 ) $ (11.3 ) $ 403.2 $
404.8 (0.4 )% $ 398.6 1.2 % EMEA 62.5 6.4 (2.6 ) 66.3 57.7 14.8 %
56.8 16.6 % Emerging Markets 48.7 1.0 (0.8 ) 48.9
43.5 12.4 % 42.8 14.1 %
EES $
527.4 $ 5.7 $
(14.7 ) $ 518.4 $
506.0 2.4 % $ 498.2
4.0 % Utility Power Solutions
North America $ 383.5 $ (1.3 ) $ (0.2 ) $ 382.0 $
361.1 5.8 % $ 355.5 7.4 %
UPS $
383.5 $ (1.3 ) $
(0.2 ) $ 382.0 $
361.1 5.8 % $ 355.5
7.4 %
Total $ 1,895.8 $
8.3 $ (14.9 ) $
1,889.2 $ 1,816.2 4.0
% $ 1,788.2 5.6 %
Geographic Sales North America $ 1,567.7 $ (5.4 ) $ (11.5 )
$ 1,550.8 $ 1,513.9 2.4 % $ 1,490.6 4.0 % EMEA 155.4 10.5 (2.6 )
163.3 139.1 17.5 % 136.9 19.3 % Emerging Markets 172.7 3.2
(0.8 ) 175.1 163.2 7.3 % 160.7 8.9 %
Total $ 1,895.8 $ 8.3
$ (14.9 ) $ 1,889.2
$ 1,816.2 4.0 % $
1,788.2 5.6 % Note: There
were 64 billing days in the first quarter of 2017 compared to 65
billing days in the first quarter of 2016.
ANIXTER
INTERNATIONAL INC. Financial Measures That Supplement U.S.
GAAP (Unaudited) - continued (In
millions, except per share amounts) Positive
(Negative) impact Three Months Ended March 31,
2017 April 1, 2016 Continuing operations
Items impacting comparability of results: Items impacting
operating expense and operating income: Amortization of intangible
assets $ (9.0 ) $ (9.7 ) Acquisition and integration costs —
(2.2 )
Total of items impacting operating expense and operating
income $ (9.0 ) $ (11.9
) Items impacting income taxes: Tax impact of items
impacting pre-tax income above $ 2.9 $ 4.5
Total
of items impacting income taxes $ 2.9
$ 4.5 Net income impact of these items
$ (6.1 ) $ (7.4 )
Diluted EPS impact of these items $ (0.18
) $ (0.22 ) U.S. GAAP to
Non-GAAP Net Income and EPS Reconciliation for continuing
operations: Net income from continuing operations – U.S. GAAP $
30.9 $ 23.2 Items impacting net income from continuing operations
6.1 7.4 Net income from continuing operations –
Non-GAAP $ 37.0 $ 30.6 Diluted EPS – U.S. GAAP
$ 0.91 $ 0.70 Diluted EPS impact of these items 0.18 0.22
Diluted EPS – Non-GAAP $ 1.09 $ 0.92
Items Impacting Comparability of Operating Income
by Segment Three Months Ended March 31, 2017
(In millions) NSS EES UPS
Corporate Total Operating income
- U.S. GAAP $ 61.8 $ 27.9 $ 16.2 $ (36.9 ) $ 69.0 Operating margin
- U.S. GAAP 6.3 % 5.3 % 4.2 % nm 3.6 %
Total of items impacting operating income $
3.6 $ 1.6 $ 3.5
$ 0.3 $ 9.0
Adjusted operating income - Non-GAAP $ 65.4 $ 29.5 $ 19.7 $ (36.6 )
$ 78.0 Adjusted operating margin - Non-GAAP 6.6 % 5.6 % 5.1 % nm
4.1 %
nm - not meaningful
Items Impacting Comparability of Operating Income by Segment
Three Months Ended April 1, 2016 (In millions)
NSS EES UPS
Corporate Total Operating income - U.S.
GAAP $ 58.8 $ 22.5 $ 14.3 $ (35.3 ) $ 60.3 Operating margin - U.S.
GAAP 6.2 % 4.4 % 3.9 % nm 3.3 %
Total of items impacting operating income $
3.6 $ 2.2 $ 4.2
$ 1.9 $ 11.9
Adjusted operating income - Non-GAAP $ 62.4 $ 24.7 $ 18.5 $
(33.4 ) $ 72.2 Adjusted operating margin - Non-GAAP 6.6 % 4.9 % 5.1
% nm 4.0 %
nm - not meaningful
ANIXTER INTERNATIONAL INC.
Financial Measures That Supplement U.S. GAAP (Unaudited)
- continued
2017 and 2016 Effective Tax Rate – U.S. GAAP and Non-GAAP
Three Months Ended (In millions) March 31,
2017 April 1, 2016 Income from continuing operations
before taxes – U.S. GAAP $ 49.9 $ 37.4 Income tax expense – U.S.
GAAP $ 19.0 $ 14.2 Effective income tax rate 38.1 % 37.9 %
Total of items impacting pre-tax income above $
9.0 $ 11.9 Total of items
impacting income taxes above $ 2.9
$ 4.5 Income from continuing operations
before income taxes – Non-GAAP $ 58.9 $ 49.3 Income tax expense –
Non-GAAP $ 21.9 $ 18.7 Adjusted effective income tax rate 37.2 %
37.9 %
2017 EBITDA by Segment Three Months Ended March
31, 2017 (In millions) NSS EES
UPS Corporate Total Net
income from continuing operations $ 61.8 $ 27.9 $ 16.2 $ (75.0 ) $
30.9 Interest expense — — — 18.9 18.9 Income taxes — — — 19.0 19.0
Depreciation 0.8 0.6 1.0 4.6 7.0 Amortization of intangible assets
3.6 2.1 3.3 — 9.0
EBITDA
$ 66.2 $ 30.6 $
20.5 $ (32.5 ) $
84.8 EBITDA leverage 1.2x 5.0x
0.7x nm 3.3x EBITDA as a % of sales
6.7 % 5.8 % 5.3 %
nm 4.5 % Foreign exchange and other
non-operating expense $ — $ — $ — $ 0.2 $ 0.2 Stock-based
compensation 0.4 0.3 0.2 3.6 4.5 Restructuring charge — (0.5
) 0.2 0.3 —
Adjusted EBITDA $
66.6 $ 30.4 $
20.9 $ (28.4 )
$ 89.5 Adjusted EBITDA leverage
1.1x 4.7x 0.7x nm 1.7x
Adjusted EBITDA as a % of sales 6.8 %
5.8 % 5.5 % nm 4.7
% nm - not meaningful
2016
EBITDA by Segment Three Months Ended April 1,
2016 (In millions) NSS EES
UPS Corporate Total Net income
from continuing operations $ 58.8 $ 22.5 $ 14.3 $ (72.4 ) $ 23.2
Interest expense — — — 20.1 20.1 Income taxes — — — 14.2 14.2
Depreciation 0.9 0.5 1.4 4.2 7.0 Amortization of intangible assets
3.6 2.2 3.9 — 9.7
EBITDA
$ 63.3 $ 25.2 $
19.6 $ (33.9 ) $
74.2 EBITDA leverage 2.2x nm
0.4x nm 0.4x EBITDA as a % of sales
6.7 % 5.0 % 5.4 %
nm 4.1 % Foreign exchange and other
non-operating expense $ — $ — $ — $ 2.8 $ 2.8 Stock-based
compensation 0.5 0.2 0.2 3.2 4.1 Acquisition and integration costs
— — 0.3 1.9 2.2
Adjusted
EBITDA $ 63.8 $ 25.4
$ 20.1 $ (26.0 ) $
83.3 Adjusted EBITDA leverage 2.2x
nm 0.4x nm 0.5x Adjusted EBITDA as a
% of sales 6.7 % 5.0 % 5.6
% nm 4.6 % nm - not
meaningful
View source
version on businesswire.com: http://www.businesswire.com/news/home/20170425005357/en/
Anixter International Inc.INVESTOR CONTACTSTed
DoschEVP - Finance & Chief Financial Officer(224)
521-4281orLisa M. Gregory, CFAVP - Investor
Relations(224) 521-8895
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