Posts Record Backlog of
Highlights
-
Net sales increased 85% to
$188.2 million for the fourth quarter of 2011 versus the fourth quarter of 2010, reflecting increased sales of$90.6 million from the acquisition ofLaBarge, Inc. (“LaBarge”) -
The Company reported a net loss of
$(4.60) per diluted share for the fourth quarter of 2011, reflecting a pre-tax non-cash goodwill impairment charge of$54.3 million and acquisition-related expenses. Excluding goodwill impairment charges and acquisition-related expenses, the Company’s net income was$0.27 per diluted share in the quarter. The non-cash charge does not impact the Company's ongoing business operations nor does it affect liquidity, cash flow from operations or financial covenant compliance for any of the Company's outstanding debt -
Cash flow from operations was
$27.9 million in the fourth quarter 2011 and$22.6 million for the full year 2011, excluding acquisition-related expenses -
Ducommun’s record backlog at
December 31, 2011 was approximately$636 million
“Ducommun ended 2011 much stronger and better positioned than when the
year began, with our operations bolstered by the addition of LaBarge,”
said
Fourth Quarter Results
Sales for the fourth quarter of 2011 increased 85% to
During the quarter, the Company generated
Ducommun AeroStructures (DAS)
The DAS segment reported net sales for the fourth quarter of
Ducommun LaBarge Technologies (DLT)
The DLT segment reported net sales for the fourth quarter of
Corporate General and Administrative Expenses (CG&A)
CG&A expenses for the fourth quarter 2011 were
Full Year Results
Sales for the twelve months of 2011 increased 42% to
Ducommun AeroStructures (DAS)
The DAS segment reported net sales for the twelve months of 2011 of
Ducommun LaBarge Technologies (DLT)
The DLT segment reported net sales for the twelve months of 2011 of
Corporate General and Administrative Expenses (CG&A)
CG&A expenses in 2011 were
“While we still have work to do, particularly with regard to improving margins, we feel very confident about the future given the strengths of a more capable and multifaceted Ducommun,” Mr. Reardon continued. “We now have additional talent to deploy, more technical and manufacturing expertise to provide, and a broader base of customers with which to partner. We knew that the last half of 2011 would present some challenges, but we did an excellent job integrating DLT and had solid operating performance within that segment as a result. Furthermore, we won and began development on 14 new aerostructure programs last year, and, while these startup contracts adversely impacted 2011 performance, we believe that investing in such programs and customers will help drive higher revenue and profit margins over the long term. Our immediate goal is to continue to generate solid cash flow, retire debt and reduce our leverage. Some challenges surely remain as we drive to improve operating results, but the outlook is bright for Ducommun.”
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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
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 | ||||||||||||||||||||
COMPARATIVE DATA | ||||||||||||||||||||
CONSOLIDATED STATEMENT OF OPERATIONS | ||||||||||||||||||||
(In thousands, except per share amounts) | ||||||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||||||
Dec. 31, | Dec. 31, | Dec. 31, | Dec. 31, | |||||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||||||
Sales and Service Revenues | ||||||||||||||||||||
Product sales | $ | 181,645 | $ | 93,408 | $ | 552,408 | $ | 367,563 | ||||||||||||
Service revenues | 6,593 | 8,362 | 28,506 | 40,843 | ||||||||||||||||
Total | 188,238 | 101,770 | 580,914 | 408,406 | ||||||||||||||||
Operating Costs and Expenses: | ||||||||||||||||||||
Cost of product sales | 151,532 | 76,396 | 453,473 | 296,104 | ||||||||||||||||
Cost of service revenues | 4,371 | 6,826 | 21,505 | 32,156 | ||||||||||||||||
Selling, general & administrative expenses | 23,487 | 14,194 | 85,790 | 53,678 | ||||||||||||||||
Goodwill impairment | 54,273 | - | 54,273 | - | ||||||||||||||||
Total | 233,663 | 97,416 | 615,041 | 381,938 | ||||||||||||||||
Operating (Loss)/Income | (45,425 | ) | 4,354 | (34,127 | ) | 26,468 | ||||||||||||||
Interest Expense | (8,151 | ) | (113 | ) | (18,198 | ) | (1,805 | ) | ||||||||||||
(Loss)/Income Before Taxes | (53,576 | ) | 4,241 | (52,325 | ) | 24,663 | ||||||||||||||
Income Tax Benefit/(Expense) | 5,082 | (82 | ) | 4,742 | (4,855 | ) | ||||||||||||||
Net (Loss)/Income | $ | (48,494 | ) | $ | 4,159 | $ | (47,583 | ) | $ | 19,808 | ||||||||||
Earnings Per Share | ||||||||||||||||||||
Basic (loss)/earnings per share | $ | (4.60 | ) | $ | 0.40 | $ | (4.52 | ) | $ | 1.89 | ||||||||||
Diluted (loss)/earnings per share | $ | (4.60 | ) | $ | 0.39 | $ | (4.52 | ) | $ | 1.87 | ||||||||||
Weighted Averaged Number of | ||||||||||||||||||||
Common Shares Outstanding: | ||||||||||||||||||||
Basic | 10,541 | 10,504 | 10,536 | 10,488 | ||||||||||||||||
Diluted | 10,565 | 10,626 | 10,621 | 10,596 | ||||||||||||||||
DUCOMMUN INCORPORATED AND SUBSIDARIES | |||||||
COMPARATIVE DATA | |||||||
CONSOLIDATED BALANCE SHEETS | |||||||
(In thousands, except per share amounts) | |||||||
Year Ended December 31, | |||||||
2011 | 2010 | ||||||
Assets | |||||||
Current Assets: | |||||||
Cash and cash equivalents | $ | 41,449 | $ | 10,268 | |||
Accounts receivable (less allowance for doubtful | |||||||
accounts of $488 and $415) | 96,174 | 47,949 | |||||
Unbilled receivables | 3,286 | 3,856 | |||||
Inventories | 154,503 | 72,597 | |||||
Production cost of contracts | 18,711 | 16,889 | |||||
Deferred income taxes | 12,020 | 5,085 | |||||
Other current assets | 14,648 | 4,748 | |||||
Total Current Assets | 340,791 | 161,392 | |||||
Property and Equipment, Net | 98,477 | 59,461 | |||||
Goodwill | 163,845 | 100,442 | |||||
Intangibles | 187,854 | 21,992 | |||||
Other Assets | 17,120 | 2,165 | |||||
$ | 808,087 | $ | 345,452 | ||||
Liabilities and Shareholders' Equity | |||||||
Current Liabilities: | |||||||
Current portion of long-term debt | $ | 1,960 | $ | 187 | |||
Accounts payable | 60,675 | 39,925 | |||||
Accrued liabilities | 53,823 | 31,174 | |||||
Total Current Liabilities | 116,458 | 71,286 | |||||
Long-Term Debt, Less Current Portion | 390,280 | 3,093 | |||||
Deferred Income Taxes | 72,043 | 7,691 | |||||
Other Long-Term Liabilities | 25,022 | 9,197 | |||||
Total Liabilities | 603,803 | 91,267 | |||||
Commitments and Contingencies | |||||||
Shareholders' Equity: | |||||||
Common stock -- $.01 par value; authorized 35,000,000 | |||||||
shares; issued 10,683,863 shares in 2011 and | |||||||
10,650,443 shares in 2010 | 107 | 106 | |||||
Treasury stock -- held in treasury 143,300 shares in 2011 | |||||||
and 2010 | (1,924 | ) | (1,924 | ) | |||
Additional paid-in capital | 64,378 | 61,684 | |||||
Retained earnings | 149,048 | 197,421 | |||||
Accumulated other comprehensive loss | (7,325 | ) | (3,102 | ) | |||
Total Shareholders' Equity | 204,284 | 254,185 | |||||
$ | 808,087 | $ | 345,452 | ||||
DUCOMMUN INCORPORATED AND SUBSIDIARIES |
|||||||||||||||||||||||
BUSINESS SEGMENT PERFORMANCE |
|||||||||||||||||||||||
(In thousands) |
|||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||
Fourth Quarter December 31, | Year Ended December 31, | ||||||||||||||||||||||
2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
Net Sales: | |||||||||||||||||||||||
Ducommun AeroStructures | $ | 68,870 | $ | 65,590 | 5.0 | % | $ | 292,759 | $ | 271,572 | 7.8 | % | |||||||||||
Ducommun LaBarge Technologies | 119,368 | 36,180 | 229.9 | % | 288,155 | 136,834 | 110.6 | % | |||||||||||||||
Total Net Sales | $ | 188,238 | $ | 101,770 | 85.0 | % | $ | 580,914 | $ | 408,406 | 42.2 | % | |||||||||||
Segment Operating (Loss)/Income (1) | |||||||||||||||||||||||
Ducommun AeroStructures | $ | 3,385 | $ | 5,397 | $ | 25,798 | $ | 28,738 | |||||||||||||||
Ducommun LaBarge Technologies (2)(6) | (45,520 | ) | 4,236 | (33,390 | ) | 13,151 | |||||||||||||||||
(42,135 | ) | 9,633 | (7,592 | ) | 41,889 | ||||||||||||||||||
Corporate General and Administrative Expenses (3)(5) | (3,290 | ) | (5,279 | ) | (26,535 | ) | (15,421 | ) | |||||||||||||||
Total Operating (Loss)/Income | $ | (45,425 | ) | $ | 4,354 | $ | (34,127 | ) | $ | 26,468 | |||||||||||||
EBITDA (1) | |||||||||||||||||||||||
Ducommun AeroStructures | |||||||||||||||||||||||
Operating Income | $ | 3,385 | $ | 5,397 | $ | 25,798 | $ | 28,738 | |||||||||||||||
Depreciation and Amortization | 2,241 | 2,556 | 9,953 | 9,666 | |||||||||||||||||||
5,626 | 7,953 | 35,751 | 38,404 | ||||||||||||||||||||
Ducommun LaBarge Technologies | |||||||||||||||||||||||
Operating (Loss)/Income (2) | (45,520 | ) | 4,236 | (33,390 | ) | 13,151 | |||||||||||||||||
Depreciation and Amortization | 4,718 | 978 | 11,445 | 3,880 | |||||||||||||||||||
(40,802 | ) | 5,214 | (21,945 | ) | 17,031 | ||||||||||||||||||
Corporate General and Administrative Expenses (3)(4)(5) | |||||||||||||||||||||||
Operating Loss | (3,290 | ) | (5,279 | ) | (26,535 | ) | (15,421 | ) | |||||||||||||||
Depreciation and Amortization | 22 | (7 | ) | 60 | 51 | ||||||||||||||||||
(3,268 | ) | (5,286 | ) | (26,475 | ) | (15,370 | ) | ||||||||||||||||
EBITDA - Excluding Goodwill Impairment | $ | (38,444 | ) | $ | 7,881 | $ | (12,669 | ) | $ | 40,065 | |||||||||||||
Adjusted EBITDA - Excluding Goodwill Impairment | |||||||||||||||||||||||
Merger related transaction expenses (3)(5) | $ | 609 | $ | - | $ | 12,394 | $ | - | |||||||||||||||
Merger related change-in-control compensation expenses (6) | 1,369 | - | 3,743 | - | |||||||||||||||||||
Goodwill Impairment | 54,273 | - | 54,273 | - | |||||||||||||||||||
56,251 | - | 70,410 | - | ||||||||||||||||||||
Adjusted EBITDA - Excluding Goodwill Impairment | $ | 17,807 | $ | 7,881 | $ | 57,741 | $ | 40,065 | |||||||||||||||
Capital Expenditures: | |||||||||||||||||||||||
Ducommun AeroStructures | $ | 1,826 | $ | 1,797 | $ | 8,798 | $ | 5,150 | |||||||||||||||
Ducommun LaBarge Technologies | 1,485 | 200 | 5,454 | 1,904 | |||||||||||||||||||
Corporate Administration | 39 | 53 | 284 | 52 | |||||||||||||||||||
Total Capital Expenditures | $ | 3,350 | $ | 2,050 | $ | 14,536 | $ | 7,106 | |||||||||||||||
|
(1) Before certain allocated corporate overhead. |
(2) Includes approximately $54.3 million of goodwill impairment expense in the three months and twelve months ended December 31, 2011. |
(3) Includes approximately $.6 million and $12.4 million of merger-related transaction expenses related to the Labarge acquisition in the three months and twelve months ended December 31, 2011, respectively, and $0 in 2010. |
(4) 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. |
(5) Includes investment banking, accounting, legal, tax and valuation expenses as a direct result of the LaBarge acquisition. |
(6) Includes approximately $1.4 million and $3.7 million of merger-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 and twelve months ended December 31, 2011, respectively. |
Source:
Ducommun Incorporated
Joseph P. Bellino
Vice President and
Chief Financial Officer
(310) 513-7211
or
Investor
Relations
Chris Witty, (646) 438-9385
cwitty@darrowir.com