READING, Pa., March 13, 2015 /PRNewswire/ -- EnerSys
(NYSE: ENS) the global leader in stored energy solutions for
industrial applications, announced today that it expects to record
a fourth quarter non-cash goodwill impairment charge of
approximately $25 million to reduce
the carrying value of the Company's goodwill, which had a book
value of $403 million at December 28, 2014.
The reasons for the charge are certain reporting units in the
Americas have been negatively impacted by the slowdown in the
enclosure business resulting from lower capital spending by a major
customer in the telecommunications market and the cancellation of
certain programs with a major contractor serving the aerospace and
defense markets.
The Company is finalizing its annual goodwill impairment
testing, which commenced on the first day of the fourth quarter of
fiscal 2015, which was December 29,
2014, and estimates that the charge is expected to be
approximately $25 million, with
minimal expected tax benefit. Upon completion of the annual
goodwill impairment testing, the final charge will be recorded and
reported in the Company's Annual Report on Form 10-K for the fiscal
year ending March 31, 2015.
The impact on the Company's reported net earnings per diluted
share as a result of this charge is expected to be approximately
$0.54 per share. The guidance for
non-GAAP adjusted net earnings per diluted share for the fourth
quarter issued in the Company's press release on February 4, 2015 remains unchanged. That guidance
was $1.10 to $1.14 and excluded
highlighted charges. This impairment charge is also excluded from
the guidance.
While the goodwill impairment charge will reduce the Company's
reported results under US GAAP, it will be non-cash in nature and
will not affect the Company's liquidity, cash flows from operating
activities and debt covenants, nor will it have any impact on
future operations.
A description of the Company's accounting policies and
practices related to goodwill and other intangible assets can be
found in the Company's Annual Report on Form 10-K for the fiscal
year ended March 31, 2014 and Quarterly Report on Form 10-Q
for the fiscal period ended December 28, 2014.
For more information, contact Thomas
O'Neill, Vice President and Treasurer, EnerSys, P.O. Box
14145, Reading, PA 19612-4145,
USA. Tel: 610-236-4040; Web site:
www.enersys.com.
EDITOR'S NOTE: EnerSys, the global leader in stored energy
solutions for industrial applications, manufactures and distributes
reserve power and motive power batteries, battery chargers, power
equipment, battery accessories and outdoor equipment enclosure
solutions to customers worldwide. Motive power batteries and
chargers are utilized in electric forklift trucks and other
commercial electric powered vehicles. Reserve power batteries
are used in the telecommunication and utility industries,
uninterruptible power supplies, and numerous applications requiring
stored energy solutions including medical, aerospace and defense
systems. Outdoor equipment enclosure products are utilized in
the telecommunication, cable, utility, transportation
industries and by government and defense customers. The
company also provides aftermarket and customer support services to
its customers from over 100 countries through its sales and
manufacturing locations around the world.
More information regarding EnerSys can be found at
www.enersys.com.
Caution Concerning Forward-Looking Statements
This press release, and oral statements made regarding the
subjects of this press release, contains forward-looking
statements, within the meaning of the Private Securities Litigation
Reform Act of 1995, or the Reform Act, which may include, but are
not limited to, statements regarding EnerSys' annual goodwill
impairment testing for fiscal 2015, earnings estimates, plans,
objectives, expectations and intentions and other statements
contained in this press release that are not historical facts,
including statements identified by words such as "believe," "plan,"
"seek," "expect," "intend," "estimate," "anticipate," "will," and
similar expressions. All statements addressing operating
performance, events, or developments that EnerSys expects or
anticipates will occur in the future, including statements relating
to its annual goodwill impairment testing for fiscal 2015, as well
as statements expressing optimism or pessimism about future
operating results or benefits, are forward-looking statements
within the meaning of the Reform Act. The forward-looking
statements are based on management's current views and assumptions
regarding future events and operating performance, and are
inherently subject to significant business, economic, and
competitive uncertainties and contingencies and changes in
circumstances, many of which are beyond the Company's
control. The statements in this press release are made as of
the date of this press release, even if subsequently made available
by EnerSys on its website or otherwise. EnerSys does not
undertake any obligation to update or revise these statements to
reflect events or circumstances occurring after the date of this
press release.
Although EnerSys does not make forward-looking statements unless
it believes it has a reasonable basis for doing so, EnerSys cannot
guarantee their accuracy. The foregoing factors, among
others, could cause actual results to differ materially from those
described in these forward-looking statements. For a list of
other factors which could affect EnerSys' results, including
earnings estimates, see EnerSys' filings with the Securities and
Exchange Commission, including "Item 2. Management's Discussion and
Analysis of Financial Condition and Results of Operations," and
"Forward-Looking Statements," set forth in EnerSys' Quarterly
Report on Form 10-Q for the fiscal period ended December 28, 2014. No undue reliance should
be placed on any forward-looking statements.
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SOURCE EnerSys