BERWYN, Pa., Aug. 4, 2021 /PRNewswire/ -- Triumph Group,
Inc. (NYSE: TGI) ("Triumph" or the "Company") today
reported financial results for its first quarter fiscal year 2022,
which ended June 30, 2021.
First Quarter Fiscal 2022
- Net sales of $396.7 million
- Operating income of $20.8 million
with operating margin of 5%; adjusted operating income of
$31.3 million with adjusted operating
margin of 8%
- Net loss of $30.4 million, or
($0.47) per share; adjusted net
income of $5.9 million, or
$0.09 per diluted share
- Cash flow used in operations of $149.5
million; free cash use of $151.6
million
- Strengthened balance sheet through the retirement of
$349.0 million of debt
Full-Year Fiscal 2022 Guidance
- Net sales guidance of between $1.5
billion - $1.6 billion
- GAAP earnings per diluted share of between ($0.15) - $0.05
- Adjusted earnings per diluted share of between $0.41 - $0.61
- Cash flow used in operations of between $110.0 million - $125.0
million and free cash use of $135.0
million - $150.0 million
- Cash flow expected to be positive over the remainder of fiscal
2022
"Triumph delivered solid first quarter results with organic net
sales up 11% compared to the prior year, driven largely by
increased demand in commercial aviation, which translated into
higher orders for maintenance, repair and overhaul work," stated
Daniel J. Crowley, Triumph's
chairman, president and chief executive officer.
"Profitability on an adjusted basis improved year over year across
both business units."
Mr. Crowley continued, "During the quarter, we retired several
non-recurring cash uses and are on track to complete the 747
production later this month. We strengthened our balance
sheet in the quarter by reducing our debt and have no substantive
repayments until 2024. With most of our transformation
milestones behind us, Triumph today is a more predictably
profitable company and we expect to be cash flow positive over the
balance of the year. Improvements in the broader market
coupled with the positive momentum we are seeing across Triumph has
enabled us to initiate guidance for fiscal 2022. As we accelerate
our organic growth, we remain committed to conserving cash and
partnering with our customers to deliver value to all our
stakeholders."
First Quarter Fiscal Year 2022 Overview
After accounting for the impact of the divestitures and
sunsetting programs, sales for the first quarter of fiscal year
2022 were up 11% organically from the comparable prior year period
due to increased maintenance, repair and overhaul work. The
consolidated decline was driven by planned reductions on sunsetting
and divested programs.
First quarter operating income of $20.8
million included $6.0 million
loss on sale of assets and businesses and $4.5 million of restructuring costs associated
with facility exits. Net loss for the first quarter of fiscal
year 2022 was $30.4 million, or
($0.47) per share. On an
adjusted basis, net income was $5.9
million, or $0.09 per
share.
Triumph's results included the following:
($ millions
except EPS)
|
|
Pre-tax
|
|
|
After-tax
|
|
|
EPS
|
|
Loss from
Continuing Operations - GAAP
|
|
$
|
(29.1)
|
|
|
$
|
(30.4)
|
|
|
$
|
(0.47)
|
|
Loss on sale of
assets and businesses (non-cash)
|
|
|
6.0
|
|
|
|
6.0
|
|
|
|
0.09
|
|
Pension curtailment
charge
|
|
|
16.1
|
|
|
|
16.1
|
|
|
|
0.25
|
|
Restructuring costs
(cash)
|
|
|
4.5
|
|
|
|
4.5
|
|
|
|
0.07
|
|
Debt extinguishment
loss
|
|
|
9.7
|
|
|
|
9.7
|
|
|
|
0.15
|
|
Adjusted Income
from Continuing Operations - non-GAAP *
|
|
$
|
7.1
|
|
|
$
|
5.9
|
|
|
$
|
0.09
|
|
* Differences due to
rounding
|
The number of shares used in computing diluted earnings per
share for the first quarter of 2022 was 65.0 million.
Backlog, which represents the next 24 months of actual purchase
orders with firm delivery dates or contract requirements, was
$1.9 billion, down slightly as
expected on a sequential basis due to sunsetting programs and
recent production rate reductions, but partially offset by military
program increases in Systems & Support.
For the first quarter of fiscal year 2022, cash flow used in
operations was $149.5 million, which
included liquidation of approximately $42.0
million in prior period advances.
Outlook
Based on anticipated aircraft production rates, but excluding
the impacts of any potential divestitures, the Company expects net
sales for fiscal year 2022 will be approximately $1.5 billion to $1.6
billion.
The Company expects GAAP fiscal year 2022 earnings per diluted
share to be ($0.15) to $0.05 and adjusted earnings per diluted share to
be $0.41 to $0.61.
The Company expects fiscal year 2022 cash used in operations of
$110.0 million to $125.0 million and free cash use to be
$135.0 million to $150.0 million. The company expects to be
cash flow positive over the balance of the fiscal year.
The Company's current outlook reflects adjustments detailed in
the attached tables, but excludes the impacts of any potential
future divestitures.
Conference Call
Triumph will hold a conference call today, August 4th, at 8:30 a.m.
(ET) to discuss the first quarter of fiscal year 2022
results. The conference call will be available live and
archived on the Company's website
at http://www.triumphgroup.com. A slide presentation
will be included with the audio portion of the webcast, and the
presentation has been posted on the Company's website at
http://ir.triumphgroup.com/QuarterlyResults. An audio replay will
be available from August 4th to August
11th by calling (855) 859-2056 (Domestic) or (404) 537-3406
(International), passcode #5174356.
About Triumph
Triumph Group, Inc., headquartered in Berwyn, Pennsylvania, designs, engineers,
manufactures, repairs and overhauls a broad portfolio of aerospace
and defense systems, components and structures. The company serves
the global aviation industry, including original equipment
manufacturers and the full spectrum of military and commercial
aircraft operators.
More information about Triumph can be found on the Company's
website at www.triumphgroup.com.
Forward Looking Statements
Statements in this release which are not historical facts are
forward-looking statements under the provisions of the Private
Securities Litigation Reform Act of 1995, including statements of
expectations of or assumptions about financial and operational
performance, revenues, earnings per share, cash flow or use, cost
savings and operational efficiencies and organizational
restructurings. All forward-looking statements involve risks
and uncertainties which could affect the Company's actual results
and could cause its actual results to differ materially from those
expressed in any forward-looking statements made by, or on behalf
of, the Company. Further information regarding the important
factors that could cause actual results to differ from projected
results can be found in Triumph Group's reports filed with the SEC,
including our Annual Report on Form 10-K for the fiscal year ended
March 31, 2021.
Widespread health developments, including the recent global
coronavirus (COVID-19), and the responses thereto (such as
voluntary and in some cases, mandatory quarantines as well as shut
downs and other restrictions on travel and commercial, social and
other activities) could adversely and materially affect, among
other things, the economic and financial markets and labor
resources of the countries in which we operate, our manufacturing
and supply chain operations, commercial operations and sales force,
administrative personnel, third-party service providers, business
partners and customers and the demand for our products, which could
result in a material adverse effect on our business, financial
conditions and results of operations.
FINANCIAL DATA (UNAUDITED) ON FOLLOWING
PAGES
FINANCIAL DATA
(UNAUDITED)
|
|
TRIUMPH
GROUP, INC. AND SUBSIDIARIES
|
(in thousands,
except per share data)
|
|
|
|
Three Months
Ended
|
|
|
|
June
30,
|
|
CONDENSED
STATEMENTS OF OPERATIONS
|
|
2021
|
|
|
2020
|
|
Net sales
|
|
$
|
396,646
|
|
|
$
|
495,077
|
|
Cost of sales
(excluding depreciation shown below)
|
|
|
293,678
|
|
|
|
393,843
|
|
Selling, general
& administrative
|
|
|
56,251
|
|
|
|
57,203
|
|
Depreciation &
amortization
|
|
|
15,431
|
|
|
|
28,602
|
|
Impairment of
long-lived assets
|
|
|
—
|
|
|
|
252,382
|
|
Restructuring
costs
|
|
|
4,485
|
|
|
|
15,439
|
|
Loss on sale of
assets and businesses, net
|
|
|
5,969
|
|
|
|
—
|
|
Operating income
(loss)
|
|
|
20,832
|
|
|
|
(252,392)
|
|
Interest expense and
other, net
|
|
|
38,558
|
|
|
|
34,957
|
|
Debt extinguishment
loss
|
|
|
9,689
|
|
|
|
—
|
|
Non-service defined
benefit expense (income)
|
|
|
1,722
|
|
|
|
(12,416)
|
|
Income tax
expense
|
|
|
1,214
|
|
|
|
853
|
|
Net loss
|
|
$
|
(30,351)
|
|
|
$
|
(275,786)
|
|
Loss per share -
basic:
|
|
|
|
|
|
|
Net loss
|
|
$
|
(0.47)
|
|
|
$
|
(5.32)
|
|
Weighted average
common shares outstanding - basic
|
|
|
64,299
|
|
|
|
51,860
|
|
Loss per share -
diluted:
|
|
|
|
|
|
|
Net loss
|
|
$
|
(0.47)
|
|
|
$
|
(5.32)
|
|
Weighted average
common shares outstanding - diluted
|
|
|
64,299
|
|
|
|
51,860
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Continued)
|
FINANCIAL DATA
(UNAUDITED)
|
|
TRIUMPH
GROUP, INC. AND SUBSIDIARIES
|
(dollars in
thousands, except share data)
|
|
BALANCE
SHEETS
|
|
Unaudited
June 30,
2021
|
|
|
Audited
March 31,
2021
|
|
Assets
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
237,486
|
|
|
$
|
589,882
|
|
Accounts receivable,
net
|
|
|
190,185
|
|
|
|
194,066
|
|
Contract
assets
|
|
|
144,118
|
|
|
|
134,638
|
|
Inventory,
net
|
|
|
412,663
|
|
|
|
400,366
|
|
Prepaid and other
current assets
|
|
|
22,788
|
|
|
|
19,206
|
|
Assets held for
sale
|
|
|
—
|
|
|
|
216,276
|
|
Current
assets
|
|
|
1,007,240
|
|
|
|
1,554,434
|
|
Property and
equipment, net
|
|
|
204,907
|
|
|
|
211,369
|
|
Goodwill
|
|
|
522,392
|
|
|
|
521,638
|
|
Intangible assets,
net
|
|
|
99,445
|
|
|
|
102,453
|
|
Other, net
|
|
|
49,509
|
|
|
|
61,041
|
|
Total
assets
|
|
$
|
1,883,493
|
|
|
$
|
2,450,935
|
|
Liabilities &
Stockholders' Deficit
|
|
|
|
|
|
|
Current portion of
long-term debt
|
|
$
|
4,653
|
|
|
$
|
5,247
|
|
Accounts
payable
|
|
|
164,753
|
|
|
|
179,473
|
|
Contract
liabilities
|
|
|
158,252
|
|
|
|
204,379
|
|
Accrued
expenses
|
|
|
235,043
|
|
|
|
271,160
|
|
Liabilities related
to assets held for sale
|
|
|
—
|
|
|
|
58,108
|
|
Current
liabilities
|
|
|
562,701
|
|
|
|
718,367
|
|
Long-term debt, less
current portion
|
|
|
1,606,287
|
|
|
|
1,952,296
|
|
Accrued pension and
post-retirement benefits, noncurrent
|
|
|
365,832
|
|
|
|
384,256
|
|
Deferred income
taxes, noncurrent
|
|
|
7,456
|
|
|
|
7,491
|
|
Other noncurrent
liabilities
|
|
|
167,443
|
|
|
|
207,378
|
|
Stockholders'
Deficit:
|
|
|
|
|
|
|
Common stock, $.001
par value, 100,000,000 shares authorized, 64,488,674
and 64,488,674 shares issued
|
|
|
64
|
|
|
|
64
|
|
Capital in excess of
par value
|
|
|
966,532
|
|
|
|
978,272
|
|
Treasury stock, at
cost, 54,854 and 303,673 shares
|
|
|
(560)
|
|
|
|
(12,606)
|
|
Accumulated other
comprehensive loss
|
|
|
(507,520)
|
|
|
|
(530,192)
|
|
Accumulated
deficit
|
|
|
(1,284,742)
|
|
|
|
(1,254,391)
|
|
Total stockholders'
deficit
|
|
|
(826,226)
|
|
|
|
(818,853)
|
|
Total liabilities and
stockholders' deficit
|
|
$
|
1,883,493
|
|
|
$
|
2,450,935
|
|
|
|
|
|
|
|
|
(Continued)
|
FINANCIAL DATA
(UNAUDITED)
TRIUMPH
GROUP, INC. AND SUBSIDIARIES (dollars in thousands,
except share data)
|
|
|
|
Three Months Ended
June 30,
|
|
|
|
2021
|
|
|
2020
|
|
Operating
Activities
|
|
|
|
|
|
|
Net loss
|
|
$
|
(30,351)
|
|
|
$
|
(275,786)
|
|
Adjustments to
reconcile net loss to net cash used in
operating activities:
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
15,431
|
|
|
|
28,602
|
|
Impairment of
long-lived assets
|
|
|
—
|
|
|
|
252,382
|
|
Amortization of
acquired contract liability
|
|
|
(1,214)
|
|
|
|
(10,987)
|
|
Loss on sale of assets
and businesses
|
|
|
5,969
|
|
|
|
—
|
|
Curtailments and
special termination benefits gain, net
|
|
|
16,078
|
|
|
|
—
|
|
Other amortization
included in interest expense
|
|
|
4,002
|
|
|
|
2,191
|
|
(Recovery of)
provision for credit losses
|
|
|
(28)
|
|
|
|
3,280
|
|
Share-based
compensation
|
|
|
2,247
|
|
|
|
2,786
|
|
Changes in other
assets and liabilities, excluding the effects of
acquisitions and divestitures:
|
|
|
|
|
|
|
Trade and other
receivables
|
|
|
(1,321)
|
|
|
|
86,004
|
|
Contract
assets
|
|
|
(4,426)
|
|
|
|
(63,391)
|
|
Inventories
|
|
|
(9,354)
|
|
|
|
(33,330)
|
|
Prepaid expenses and
other current assets
|
|
|
(3,633)
|
|
|
|
549
|
|
Accounts payable,
accrued expenses, and contract liabilities
|
|
|
(128,922)
|
|
|
|
(184,114)
|
|
Accrued pension and
other postretirement benefits
|
|
|
(13,713)
|
|
|
|
(5,054)
|
|
Other, net
|
|
|
(279)
|
|
|
|
(665)
|
|
Net cash used in
operating activities
|
|
|
(149,514)
|
|
|
|
(197,533)
|
|
Investing
Activities
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(2,112)
|
|
|
|
(7,723)
|
|
Proceeds from sale of
assets and businesses
|
|
|
180,478
|
|
|
|
792
|
|
Purchase of facility
related to divested businesses
|
|
|
(21,550)
|
|
|
|
—
|
|
Net cash provided by
(used in) investing activities
|
|
|
156,816
|
|
|
|
(6,931)
|
|
Financing
Activities
|
|
|
|
|
|
|
Net decrease in
revolving credit facility
|
|
|
—
|
|
|
|
(225,000)
|
|
Proceeds from
issuance of long-term debt
|
|
|
—
|
|
|
|
6,300
|
|
Retirement of debt
and finance lease obligations
|
|
|
(350,688)
|
|
|
|
(27,468)
|
|
Payment of deferred
financing costs
|
|
|
—
|
|
|
|
(4,277)
|
|
Premium on redemption
of First Lien Notes
|
|
|
(7,489)
|
|
|
|
—
|
|
Repurchase of shares
for share-based compensation
minimum tax obligation
|
|
|
(2,336)
|
|
|
|
(474)
|
|
Net cash used in
financing activities
|
|
|
(360,513)
|
|
|
|
(250,919)
|
|
Effect of exchange
rate changes on cash
|
|
|
815
|
|
|
|
829
|
|
Net change in cash
and cash equivalents
|
|
|
(352,396)
|
|
|
|
(454,554)
|
|
Cash and cash
equivalents at beginning of period
|
|
|
589,882
|
|
|
|
485,463
|
|
Cash and cash
equivalents at end of period
|
|
$
|
237,486
|
|
|
$
|
30,909
|
|
(Continued)
|
FINANCIAL DATA
(UNAUDITED)
|
|
TRIUMPH GROUP,
INC. AND SUBSIDIARIES
|
(dollars in
thousands)
|
|
|
|
Three Months
Ended
|
|
|
|
June
30,
|
|
SEGMENT
DATA
|
|
2021
|
|
|
2020
|
|
Net sales:
|
|
|
|
|
|
|
Systems &
Support
|
|
$
|
258,413
|
|
|
$
|
239,887
|
|
Aerospace
Structures
|
|
|
138,252
|
|
|
|
257,877
|
|
Elimination of
intersegment sales
|
|
|
(19)
|
|
|
|
(2,687)
|
|
|
|
$
|
396,646
|
|
|
$
|
495,077
|
|
Operating income
(loss):
|
|
|
|
|
|
|
Systems &
Support
|
|
$
|
35,546
|
|
|
$
|
25,431
|
|
Aerospace
Structures
|
|
|
11,223
|
|
|
|
(256,120)
|
|
Corporate
|
|
|
(23,690)
|
|
|
|
(18,917)
|
|
Share-based
compensation expense
|
|
|
(2,247)
|
|
|
|
(2,786)
|
|
|
|
$
|
20,832
|
|
|
$
|
(252,392)
|
|
Operating margin
%
|
|
|
|
|
|
|
Systems &
Support
|
|
|
13.8
|
%
|
|
|
10.6
|
%
|
Aerospace
Structures
|
|
|
8.1
|
%
|
|
|
(99.3)
|
%
|
Consolidated
|
|
|
5.3
|
%
|
|
|
(51.0)
|
%
|
|
|
|
|
|
|
|
Depreciation and
amortization^:
|
|
|
|
|
|
|
Systems &
Support
|
|
$
|
8,504
|
|
|
$
|
8,356
|
|
Aerospace
Structures
|
|
|
6,159
|
|
|
|
271,772
|
|
Corporate
|
|
|
768
|
|
|
|
856
|
|
|
|
$
|
15,431
|
|
|
$
|
280,984
|
|
Amortization of
acquired contract liabilities:
|
|
|
|
|
|
|
Systems &
Support
|
|
$
|
(1,202)
|
|
|
$
|
(3,719)
|
|
Aerospace
Structures
|
|
|
(12)
|
|
|
|
(7,268)
|
|
|
|
$
|
(1,214)
|
|
|
$
|
(10,987)
|
|
Capital
expenditures:
|
|
|
|
|
|
|
Systems &
Support
|
|
$
|
1,102
|
|
|
$
|
6,283
|
|
Aerospace
Structures
|
|
|
652
|
|
|
|
1,029
|
|
Corporate
|
|
|
358
|
|
|
|
411
|
|
|
|
$
|
2,112
|
|
|
$
|
7,723
|
|
^ includes long-lived
asset impairment charge in the first quarter of fiscal
2021
|
(Continued)
FINANCIAL DATA (UNAUDITED)
TRIUMPH GROUP, INC. AND SUBSIDIARIES
(dollars in thousands)
Non-GAAP Financial Measure Disclosures
We prepare and publicly release quarterly unaudited financial
statements prepared in accordance with GAAP. In accordance with
Securities and Exchange Commission (the "SEC") guidance on
Compliance and Disclosure Interpretations, we also disclose and
discuss certain non-GAAP financial measures in our public releases.
Currently, the non-GAAP financial measure that we disclose is
Adjusted EBITDA and Adjusted EBITDAP, which is our net income
before interest, income taxes, amortization of acquired contract
liabilities, curtailments, settlements and special termination
benefits, legal settlements, depreciation and amortization and
Adjusted EBITDA, less pension & other postretirement benefits.
We disclose Adjusted EBITDA and Adjusted EBITDAP on a consolidated
and Adjusted EBITDAP an operating segment basis in our earnings
releases, investor conference calls and filings with the SEC. The
non-GAAP financial measures that we use may not be comparable to
similarly titled measures reported by other companies. Also, in the
future, we may disclose different non-GAAP financial measures in
order to help our investors more meaningfully evaluate and compare
our future results of operations to our previously reported results
of operations.
We view Adjusted EBITDA and Adjusted EBITDAP as operating
performance measure and as such we believe that the GAAP financial
measure most directly comparable to it is net income. In
calculating Adjusted EBITDA and Adjusted EBITDAP, we exclude from
net income the financial items that we believe should be separately
identified to provide additional analysis of the financial
components of the day-to-day operation of our business. We have
outlined below the type and scope of these exclusions and the
material limitations on the use of these non-GAAP financial
measures as a result of these exclusions. Adjusted EBITDA and
Adjusted EBITDAP are not measurements of financial performance
under GAAP and should not be considered as a measure of liquidity,
as an alternative to net income (loss), income from continuing
operations, or as an indicator of any other measure of performance
derived in accordance with GAAP. Investors and potential
investors in our securities should not rely on Adjusted EBITDA or
Adjusted EBITDAP as substitutes for any GAAP financial measure,
including net income (loss) or income from continuing operations.
In addition, we urge investors and potential investors in our
securities to carefully review the reconciliation of Adjusted
EBITDA and Adjusted EBITDAP to net income set forth below, in our
earnings releases and in other filings with the SEC and to
carefully review the GAAP financial information included as part of
our Quarterly Reports on Form 10-Q and our Annual Reports on Form
10-K that are filed with the SEC, as well as our quarterly earnings
releases, and compare the GAAP financial information with our
Adjusted EBITDA and Adjusted EBITDAP.
Adjusted EBITDA and Adjusted EBITDAP is used by management to
internally measure our operating and management performance and by
investors as a supplemental financial measure to evaluate the
performance of our business that, when viewed with our GAAP results
and the accompanying reconciliation, we believe provides additional
information that is useful to gain an understanding of the factors
and trends affecting our business. We have spent more than 20
years expanding our product and service capabilities partially
through acquisitions of complementary businesses. Due to the
expansion of our operations, which included acquisitions, our net
income has included significant charges for depreciation and
amortization. Adjusted EBITDA and Adjusted EBITDAP exclude
these charges and provide meaningful information about the
operating performance of our business, apart from charges for
depreciation and amortization. We believe the disclosure of
Adjusted EBITDA and Adjusted EBITDAP helps investors meaningfully
evaluate and compare our performance from quarter to quarter and
from year to year. We also believe Adjusted EBITDA and Adjusted
EBITDAP is a measure of our ongoing operating performance because
the isolation of non-cash income and expenses, such as amortization
of acquired contract liabilities, depreciation and amortization,
and non-operating items, such as interest and income taxes,
provides additional information about our cost structure, and, over
time, helps track our operating progress. In addition, investors,
securities analysts and others have regularly relied on Adjusted
EBITDA and Adjusted EBITDAP to provide a financial measure by which
to compare our operating performance against that of other
companies in our industry.
Set forth below are descriptions of the financial items that
have been excluded from our net income to calculate Adjusted EBITDA
and Adjusted EBITDAP and the material limitations associated with
using this non-GAAP financial measure as compared to net
income:
- Divestitures may be useful for investors to consider because
they reflect gains or losses from sale of operating units. We do
not believe these earnings necessarily reflect the current and
ongoing cash earnings related to our operations.
- Non-service defined benefit income (inclusive of the adoption
of ASU 2017-07 and certain pension related transactions such as
curtailments, settlements, early retirement or other incentives)
may be useful to investors to consider because they represent the
cost of post-retirement benefits to plan participants, net of the
assumption of returns on the plan's assets and are not indicative
of the cash paid for such benefits. We do not believe these
earnings (expenses) necessarily reflect the current and ongoing
cash earnings related to our operations.
- Amortization of acquired contract liabilities may be useful for
investors to consider because it represents the non-cash earnings
on the fair value of below market contracts acquired through
acquisitions. We do not believe these earnings necessarily reflect
the current and ongoing cash earnings related to our
operations.
- Amortization expense and nonrecurring asset impairments
(including goodwill, intangible asset impairments, and nonrecurring
rotable inventory impairments) may be useful for investors to
consider because it represents the estimated attrition of our
acquired customer base and the diminishing value of tradenames,
product rights, licenses, or, in the case of goodwill, other assets
that are not individually identified and separately recognized
under U.S. GAAP, or, in the case of nonrecurring asset impairments,
the impact of unusual and nonrecurring events affecting the
estimated recoverability of existing assets. We do not believe
these charges necessarily reflect the current and ongoing cash
charges related to our operating cost structure,
- Depreciation may be useful for investors to consider because
they generally represent the wear and tear on our property and
equipment used in our operations. We do not believe these charges
necessarily reflect the current and ongoing cash charges related to
our operating cost structure.
- The amount of interest expense and other we incur may be useful
for investors to consider and may result in current cash inflows or
outflows. However, we do not consider the amount of interest
expense and other to be a representative component of the
day-to-day operating performance of our business.
- Income tax expense may be useful for investors to consider
because it generally represents the taxes which may be payable for
the period and the change in deferred income taxes during the
period and may reduce the amount of funds otherwise available for
use in our business. However, we do not consider the amount of
income tax expense to be a representative component of the
day-to-day operating performance of our business.
Management compensates for the above-described limitations of
using non-GAAP measures by using a non-GAAP measure only to
supplement our GAAP results and to provide additional information
that is useful to gain an understanding of the factors and trends
affecting our business.
(Continued)
|
FINANCIAL DATA
(UNAUDITED)
|
|
TRIUMPH GROUP,
INC. AND SUBSIDIARIES
|
(dollars in
thousands)
|
|
The following table
shows our Adjusted EBITDA and Adjusted EBITDAP reconciled to our
net income for the indicated periods (in thousands):
|
|
|
|
Three Months
Ended
|
|
|
|
June
30,
|
|
Adjusted Earnings
before Interest, Taxes, Depreciation,
Amortization, and Pension (Adjusted EBITDAP):
|
|
2021
|
|
|
2020
|
|
Net loss
|
|
$
|
(30,351)
|
|
|
$
|
(275,786)
|
|
Add-back:
|
|
|
|
|
|
|
Income tax
expense
|
|
|
1,214
|
|
|
|
853
|
|
Interest expense and
other, net
|
|
|
38,558
|
|
|
|
34,957
|
|
Debt extinguishment
loss
|
|
|
9,689
|
|
|
|
—
|
|
Pension curtailment
charge
|
|
|
16,078
|
|
|
|
—
|
|
Loss on sale of assets
and businesses, net
|
|
|
5,969
|
|
|
|
—
|
|
Amortization of
acquired contract liabilities
|
|
|
(1,214)
|
|
|
|
(10,987)
|
|
Depreciation and
amortization^
|
|
|
15,431
|
|
|
|
280,984
|
|
Adjusted Earnings
before Interest, Taxes, Depreciation
and
Amortization ("Adjusted EBITDA")
|
|
$
|
55,374
|
|
|
$
|
30,021
|
|
Non-service defined
benefit income (excluding Curtailment and special term
benefits)
|
|
|
(14,356)
|
|
|
|
(12,416)
|
|
Adjusted Earnings
before Interest, Taxes, Depreciation
and
Amortization, and Pension ("Adjusted EBITDAP")
|
|
$
|
41,018
|
|
|
$
|
17,605
|
|
Net sales
|
|
$
|
396,646
|
|
|
$
|
495,077
|
|
Net loss
margin
|
|
|
(7.7)
|
%
|
|
|
(55.7)
|
%
|
Adjusted EBITDAP
margin
|
|
|
10.4
|
%
|
|
|
3.6
|
%
|
|
|
|
|
|
|
|
(Continued)
|
FINANCIAL DATA
(UNAUDITED)
|
|
TRIUMPH GROUP,
INC. AND SUBSIDIARIES
|
(dollars in
thousands)
|
|
Non-GAAP Financial
Measure Disclosures (continued)
|
|
|
|
Three Months Ended
June 30, 2021
|
|
|
|
|
|
|
Segment
Data
|
|
Adjusted Earnings
before Interest, Taxes, Depreciation,
Amortization, and Pension (EBITDAP):
|
|
Total
|
|
|
Systems &
Support
|
|
|
Aerospace
Structures
|
|
|
Corporate/
Eliminations*
|
|
Net loss
|
|
$
|
(30,351)
|
|
|
|
|
|
|
|
|
|
|
Add-back:
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-service defined
benefit expense
|
|
|
1,722
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
|
1,214
|
|
|
|
|
|
|
|
|
|
|
Debt extinguishment
loss
|
|
|
9,689
|
|
|
|
|
|
|
|
|
|
|
Interest expense and
other, net
|
|
|
38,558
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss)
|
|
$
|
20,832
|
|
|
$
|
35,546
|
|
|
$
|
11,223
|
|
|
$
|
(25,937)
|
|
Loss on sales of
assets & businesses, net
|
|
|
5,969
|
|
|
|
—
|
|
|
|
—
|
|
|
|
5,969
|
|
Amortization of
acquired contract liabilities
|
|
|
(1,214)
|
|
|
|
(1,202)
|
|
|
|
(12)
|
|
|
|
—
|
|
Depreciation and
amortization
|
|
|
15,431
|
|
|
|
8,504
|
|
|
|
6,159
|
|
|
|
768
|
|
Adjusted Earnings
(Losses) before Interest, Taxes,
Depreciation and Amortization, and Pension
("Adjusted EBITDAP")
|
|
$
|
41,018
|
|
|
$
|
42,848
|
|
|
$
|
17,370
|
|
|
$
|
(19,200)
|
|
Net sales
|
|
$
|
396,646
|
|
|
$
|
258,413
|
|
|
$
|
138,252
|
|
|
$
|
(19)
|
|
Adjusted EBITDAP
margin
|
|
|
10.4
|
%
|
|
|
16.7
|
%
|
|
|
12.6
|
%
|
|
n/a
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Operating loss
at Corporate includes share-based compensation expense.
|
(Continued)
|
FINANCIAL DATA
(UNAUDITED)
|
|
TRIUMPH GROUP,
INC. AND SUBSIDIARIES
|
(dollars in
thousands)
|
|
Non-GAAP Financial
Measure Disclosures (continued)
|
|
|
|
Three Months Ended
June 30, 2020
|
|
|
|
|
|
|
Segment
Data
|
|
Adjusted Earnings
before Interest, Taxes, Depreciation,
Amortization, and Pension (EBITDAP):
|
|
Total
|
|
|
Systems &
Support
|
|
|
Aerospace
Structures
|
|
|
Corporate/
Eliminations*
|
|
Net loss
|
|
$
|
(275,786)
|
|
|
|
|
|
|
|
|
|
|
Add-back:
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-service defined
benefit income
|
|
|
(12,416)
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
|
853
|
|
|
|
|
|
|
|
|
|
|
Interest expense and
other, net
|
|
|
34,957
|
|
|
|
|
|
|
|
|
|
|
Operating (loss)
income
|
|
$
|
(252,392)
|
|
|
$
|
25,431
|
|
|
$
|
(256,120)
|
|
|
$
|
(21,703)
|
|
Amortization of
acquired contract liabilities
|
|
|
(10,987)
|
|
|
|
(3,719)
|
|
|
|
(7,268)
|
|
|
|
—
|
|
Depreciation and
amortization^
|
|
|
280,984
|
|
|
|
8,356
|
|
|
|
271,772
|
|
|
|
856
|
|
Adjusted Earnings
(Losses) before Interest,
Taxes,
Depreciation and Amortization,
and
Pension ("Adjusted EBITDAP")
|
|
$
|
17,605
|
|
|
$
|
30,068
|
|
|
$
|
8,384
|
|
|
$
|
(20,847)
|
|
Net sales
|
|
$
|
495,077
|
|
|
$
|
239,887
|
|
|
$
|
257,877
|
|
|
$
|
(2,687)
|
|
Adjusted EBITDAP
margin
|
|
|
3.6
|
%
|
|
|
12.7
|
%
|
|
|
3.3
|
%
|
|
n/a
|
|
^ includes long-lived
asset impairment charge in the first quarter of fiscal
2021
|
|
|
|
|
|
|
|
|
|
|
|
|
(Continued)
FINANCIAL DATA (UNAUDITED)
TRIUMPH GROUP, INC. AND SUBSIDIARIES
(dollars in thousands, except per share data)
Non-GAAP Financial Measure Disclosures (continued)
Adjusted income from continuing operations, before income taxes,
adjusted income from continuing operations and adjusted income from
continuing operations per diluted share, before non-recurring costs
have been provided for consistency and comparability. These
measures should not be considered in isolation or as alternatives
to income from continuing operations before income taxes, income
from continuing operations and income from continuing operations
per diluted share presented in accordance with GAAP. The
following tables reconcile income from continuing operations before
income taxes, income from continuing operations, and income from
continuing operations per diluted share, before non-recurring
costs.
|
|
Three Months
Ended
June 30, 2021
|
|
|
Fiscal 2022
Guidance
|
|
|
|
Pre-Tax
|
|
|
After-Tax
|
|
|
Diluted
EPS
|
|
|
|
|
Loss from continuing
operations - GAAP
|
|
$
|
(29,137)
|
|
|
$
|
(30,351)
|
|
|
$
|
(0.47)
|
|
|
$(0.15) -
$0.05
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on sale of
assets and businesses
|
|
|
5,969
|
|
|
|
5,969
|
|
|
|
0.09
|
|
|
|
0.09
|
|
Restructuring
costs
|
|
|
4,485
|
|
|
|
4,485
|
|
|
|
0.07
|
|
|
|
0.07
|
|
Pension curtailment
charge
|
|
|
16,078
|
|
|
|
16,078
|
|
|
|
0.25
|
|
|
|
0.25
|
|
Restructuring
costs
|
|
|
9,689
|
|
|
|
9,689
|
|
|
|
0.15
|
|
|
|
0.15
|
|
Adjusted income from
continuing operations - non-GAAP
|
|
$
|
7,084
|
|
|
$
|
5,870
|
|
|
$
|
0.09
|
|
|
$0.41 -
$0.61
|
|
* Differences
due to rounding
|
|
|
Three Months
Ended
June 30, 2020
|
|
|
|
Pre-Tax
|
|
|
After-Tax
|
|
|
Diluted
EPS
|
|
Loss from continuing
operations - GAAP
|
|
$
|
(274,933)
|
|
|
$
|
(275,786)
|
|
|
$
|
(5.32)
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Impairment of
long-lived assets
|
|
|
252,382
|
|
|
|
252,382
|
|
|
|
4.87
|
|
Restructuring
costs
|
|
|
15,439
|
|
|
|
15,439
|
|
|
|
0.30
|
|
Adjusted loss from
continuing operations - non-GAAP
|
|
$
|
(7,112)
|
|
|
$
|
(7,965)
|
|
|
$
|
(0.15)
|
|
(Continued)
FINANCIAL DATA (UNAUDITED)
TRIUMPH GROUP, INC. AND SUBSIDIARIES
(dollars in thousands, except per share data)
Non-GAAP Financial Measure Disclosures (continued)
Adjusted Operating Income is defined as GAAP Operating Income,
less expenses/gains associated with the Company's transformation,
such as restructuring expenses, gains/losses on divestitures,
impairments of goodwill and other assets. Management believes that
this is useful in evaluating operating performance, but this
measure should not be used in isolation. The following table
reconciles our Operating income to Adjusted Operating income as
noted above.
|
|
Three Months
Ended
June 30,
|
|
|
|
2021
|
|
|
2020
|
|
Operating income
(loss) - GAAP
|
|
$
|
20,832
|
|
|
$
|
(252,392)
|
|
Adjustments:
|
|
|
|
|
|
|
Loss on sale of
assets and businesses, net
|
|
|
5,969
|
|
|
|
—
|
|
Impairment of
long-lived assets
|
|
|
—
|
|
|
|
252,382
|
|
Restructuring
costs
|
|
|
4,485
|
|
|
|
15,439
|
|
Adjusted operating
income - non-GAAP
|
|
$
|
31,286
|
|
|
$
|
15,429
|
|
Adjusted operating
margin
|
|
|
7.9
|
%
|
|
|
3.1
|
%
|
Cash provided by operations, is provided for consistency and
comparability. We also use free cash flow as a key factor in
planning for and consideration of strategic acquisitions and the
repayment of debt. This measure should not be considered in
isolation, as a measure of residual cash flow available for
discretionary purposes, or as an alternative to operating results
presented in accordance with GAAP. The following table reconciles
cash provided by operations to free cash flow.
|
|
Three Months
Ended
June 30,
|
|
|
Fiscal 2022
Guidance
|
|
|
2021
|
|
|
2020
|
|
|
|
Cash used in
operating activities
|
|
$
|
(149,514)
|
|
|
$
|
(197,533)
|
|
|
$(110,000) -
$(125,000)
|
Less:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(2,112)
|
|
|
|
(7,723)
|
|
|
~$25,000
|
Free cash
use
|
|
$
|
(151,626)
|
|
|
$
|
(205,256)
|
|
|
$(135,000) -
$(150,000)
|
View original
content:https://www.prnewswire.com/news-releases/triumph-group-reports-first-quarter-fiscal-2022-results-301347898.html
SOURCE Triumph Group