Strong Aerospace Growth, Cash Flow Improvement and Margin Expansion
Highlights
-
Net sales increased 85% to
$184.3 million for the first quarter of 2012 versus the first quarter of 2011, including sales of$84.4 million from the acquisition ofLaBarge, Inc. (“LaBarge”) -
The Company reported net income of
$2.4 million , or$0.23 per diluted share, for the first quarter of 2012 -
Adjusted EBITDA grew to
$19.0 million in the first quarter of 2012 from$9.1 million in the first quarter of 2011 -
Cash flow from operations improved
$20.5 million in the first quarter versus the prior-year period -
Ducommun ended the quarter with a record backlog of approximately$647 million .
“Our first quarter showed strong commercial aerospace growth and
improvement in many of our financial metrics,” said
First Quarter Results
Sales for the first quarter of 2012 increased 85% to
Adjusted EBITDA for the first quarter of 2012 increased to
Cash flow used in operations during the first quarter of 2012 was
Ducommun AeroStructures (DAS)
The DAS segment reported net sales for the first quarter of
Ducommun LaBarge Technologies (DLT)
The DLT segment reported net sales for the first quarter of 2012 of
Corporate General and Administrative Expenses (CG&A)
CG&A expenses for the first quarter of 2012 were
“We are pleased to see attractive build rates across the majority of our commercial aerospace programs, and we remain committed to achieving improved operating results in 2012,” Mr. Reardon added. “We are focused on driving margin expansion going forward, which is paramount to ensuring greater returns for our shareholders. With a strong product portfolio across a variety of end markets and a focus on delivering total customer satisfaction, we expect to continue to strengthen our market position.”
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About
Founded in 1849,
Statements contained in this press release regarding other than
recitation of historical facts are forward-looking statements. These
statements are identified by words such as “may,” “will,” “ begin,”
“look forward,” “expect,” “believe,” “intend,” “anticipate,” “should”,
“potential,” “estimate,” “continue,” “momentum” and other words
referring to events to occur in the future. These statements reflect the
Company’s current view of future events and are based on its assessment
of, and are subject to, a variety of risks and uncertainties beyond its
control, including, but not limited to, the state of the world
financial, credit, commodities and stock markets, any difficulties,
delays or failure in, or unanticipated costs of, realizing the expected
synergies of the LaBarge acquisition, and uncertainties regarding the
Company, its businesses and the industries in which it operates, which
are described in the Company’s filings with the
DUCOMMUN INCORPORATED AND SUBSIDIARIES | |||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||
(In thousands, except per share amounts) | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Three Months Ended | |||||||||||||||||
March 31, | April 2, | ||||||||||||||||
2012 | 2011 | ||||||||||||||||
Sales and Service Revenues: | |||||||||||||||||
Product sales | $ | 177,502 | $ | 91,333 | |||||||||||||
Service revenues | 6,841 | 8,220 | |||||||||||||||
Net Sales | 184,343 | 99,553 | |||||||||||||||
Operating Costs and Expenses: | |||||||||||||||||
Cost of product sales | 144,403 | 74,839 | |||||||||||||||
Cost of service revenues | 5,469 | 6,306 | |||||||||||||||
Selling, general and administrative expenses | 22,612 | 14,149 | |||||||||||||||
Total Operating Costs and Expenses |
172,484 | 95,294 | |||||||||||||||
Operating Income | 11,859 | 4,259 | |||||||||||||||
Interest Expense, Net | (8,239 | ) | (260 | ) | |||||||||||||
Income Before Taxes | 3,620 | 3,999 | |||||||||||||||
Income Tax Expense, Net | (1,230 | ) | (1,076 | ) | |||||||||||||
Net Income | $ | 2,390 | $ | 2,923 | |||||||||||||
Earnings Per Share: | |||||||||||||||||
Basic earnings per share | $ | 0.23 | $ | 0.28 | |||||||||||||
Diluted earnings per share | $ | 0.23 | $ | 0.27 | |||||||||||||
Weighted Average Number of Common Shares Outstanding: | |||||||||||||||||
Basic | 10,546 | 10,526 | |||||||||||||||
Diluted | 10,574 | 10,634 | |||||||||||||||
DUCOMMUN INCORPORATED AND SUBSIDIARIES | |||||||||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||||||||||
(In thousands) | |||||||||||||||||
(Unaudited) | |||||||||||||||||
March 31, | December 31, | ||||||||||||||||
2012 | 2011 | ||||||||||||||||
Assets | |||||||||||||||||
Current Assets: | |||||||||||||||||
Cash and cash equivalents | $ | 31,212 | $ | 41,449 | |||||||||||||
Accounts receivable | 94,723 | 96,174 | |||||||||||||||
Unbilled receivables | 3,313 | 3,286 | |||||||||||||||
Inventories | 157,292 | 154,503 | |||||||||||||||
Production cost of contracts | 19,988 | 18,711 | |||||||||||||||
Deferred income taxes | 12,286 | 12,020 | |||||||||||||||
Other current assets | 10,913 | 14,648 | |||||||||||||||
Total Current Assets | 329,727 | 340,791 | |||||||||||||||
Property and Equipment, Net | 99,524 | 98,477 | |||||||||||||||
Goodwill | 163,845 | 163,845 | |||||||||||||||
Intangibles | 184,979 | 187,854 | |||||||||||||||
Other Assets | 16,369 | 17,120 | |||||||||||||||
$ | 794,444 | $ | 808,087 | ||||||||||||||
Liabilities and Shareholders' Equity | |||||||||||||||||
Current Liabilities: | |||||||||||||||||
Current portion of long-term debt | $ | 1,950 | $ | 1,960 | |||||||||||||
Accounts payable | 57,155 | 60,675 | |||||||||||||||
Accrued liabilities | 42,056 | 53,823 | |||||||||||||||
Total Current Liabilities | 101,161 | 116,458 | |||||||||||||||
Long-Term Debt, Less Current Portion | 389,795 | 390,280 | |||||||||||||||
Deferred Income Taxes | 71,465 | 72,043 | |||||||||||||||
Other Long-Term Liabilities | 24,709 | 25,022 | |||||||||||||||
Total Liabilities | 587,130 | 603,803 | |||||||||||||||
Commitments and Contingencies | |||||||||||||||||
Shareholders' Equity: | |||||||||||||||||
Common stock | 107 | 107 | |||||||||||||||
Treasury stock | (1,924 | ) | (1,924 | ) | |||||||||||||
Additional paid-in capital | 65,018 | 64,378 | |||||||||||||||
Retained earnings | 151,438 | 149,048 | |||||||||||||||
Accumulated other comprehensive loss | (7,325 | ) | (7,325 | ) | |||||||||||||
Total Shareholders' Equity | 207,314 | 204,284 | |||||||||||||||
$ | 794,444 | $ | 808,087 | ||||||||||||||
DUCOMMUN INCORPORATED AND SUBSIDIARIES | |||||||||||||||||
BUSINESS SEGMENT PERFORMANCE | |||||||||||||||||
(In thousands) | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Three Months | |||||||||||||||||
March 31, | April 2, | ||||||||||||||||
2012 | 2011 | Change | |||||||||||||||
Net Sales: | |||||||||||||||||
Ducommun AeroStructures | $ | 74,287 | $ | 72,204 | 2.9 | % | |||||||||||
Ducommun LaBarge Technologies | 110,056 | 27,349 | 302.4 | % | |||||||||||||
Total Net Sales | $ | 184,343 | $ | 99,553 | 85.2 | % | |||||||||||
Segment Operating Income (1) | |||||||||||||||||
Ducommun AeroStructures | $ | 6,591 | $ | 7,067 | |||||||||||||
Ducommun LaBarge Technologies (5) | 8,302 | 2,123 | |||||||||||||||
14,893 | 9,190 | ||||||||||||||||
Corporate General and Administrative Expenses (3)(5) | (3,034 | ) | (4,931 | ) | |||||||||||||
Total Operating Income | $ | 11,859 | $ | 4,259 | |||||||||||||
EBITDA (1) | |||||||||||||||||
Ducommun AeroStructures | |||||||||||||||||
Operating Income | $ | 6,591 | $ | 7,067 | |||||||||||||
Depreciation and Amortization | 2,056 | 2,557 | |||||||||||||||
8,647 | 9,624 | ||||||||||||||||
Ducommun LaBarge Technologies | |||||||||||||||||
Operating Income | 8,302 | 2,123 | |||||||||||||||
Depreciation and Amortization | 4,697 | 850 | |||||||||||||||
12,999 | 2,973 | ||||||||||||||||
Corporate General and Administrative Expenses (2)(3) | |||||||||||||||||
Operating Loss | (3,034 | ) | (4,931 | ) | |||||||||||||
Depreciation and Amortization | 51 | 4 | |||||||||||||||
(2,983 | ) | (4,927 | ) | ||||||||||||||
EBITDA | $ | 18,663 | $ | 7,670 | |||||||||||||
Adjusted EBITDA | |||||||||||||||||
Acquisition-related transaction expenses (3)(4) | $ | 151 | $ | 1,400 | |||||||||||||
Acquisition-related change-in-control compensation expenses (5) | 216 | - | |||||||||||||||
367 | 1,400 | ||||||||||||||||
Adjusted EBITDA | $ | 19,030 | $ | 9,070 | |||||||||||||
Capital Expenditures: | |||||||||||||||||
Ducommun AeroStructures | $ | 2,457 | $ | 759 | |||||||||||||
Ducommun LaBarge Technologies | 2,437 | 687 | |||||||||||||||
Corporate Administration | 23 | 63 | |||||||||||||||
Total Capital Expenditures | $ | 4,917 | $ | 1,509 |
(1) |
Before certain allocated corporate overhead. |
||||
(2) |
Includes approximately $0.15 million and $1.4 million of acquisition-related transaction expenses related to the LaBarge acquisition in the three months ended March 31, 2012 and April 2, 2011, respectively. |
||||
(3) |
Certain expenses, previously incurred by the operating units, are now included in the corporate general and administrative expense as a result of the Company's organizational changes. |
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(4) |
Includes investment banking, accounting, legal, tax and valuation expenses as a direct result of the LaBarge acquisition. |
||||
(5) |
Includes approximately $0.22 million of acquisition-related transaction costs resulting from a change-in-control provision for certain LaBarge key executives and employees arising in connection with the LaBarge acquisition in the three months ended March 31, 2012. |
Source:
Ducommun Incorporated
Joseph P. Bellino
Vice President and
Chief Financial Officer
310-513-7211
or
Chris Witty
Investor
Relations
646-438-9385
cwitty@darrowir.com