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8-K - FORM 8-K - Cornerstone Building Brands, Inc. | h80412e8vk.htm |
Exhibit 99.1
NCI Building Systems Reports First Quarter Fiscal 2011 Result
Q1 Revenues Increased 4.3%; Tonnage up 2.2%
Coatings and Components Groups Continued to Post Operating Profits
Buildings Group Bookings Increased 27% Year-Over-Year;
Coatings and Components Groups Continued to Post Operating Profits
Buildings Group Bookings Increased 27% Year-Over-Year;
Backlog Up 6% Sequentially to $205 Million
HOUSTON, March 8, 2011 /PRNewswire/ NCI Building Systems, Inc. (NYSE: NCS) today reported
financial results for the first quarter ended January 30, 2011.
First Quarter 2011 Financial Results
First quarter revenue growth was driven by a 10% increase in the combined third party sales of our
Coatings and Components groups. This performance was achieved despite a 16% decline in low-rise
nonresidential construction activity for the same period, as reported by McGraw-Hill, said Norman
C. Chambers, NCIs Chairman, President and Chief Executive Officer. Our Coatings groups results
were especially strong, reflecting the success of our efforts to build external sales to
traditional and non-traditional markets, while continuing to base load our facilities with
intersegment business. Reduced market volume affected our Buildings groups shipments, but the
group achieved year-over-year bookings and sequential backlog growth of 27% and 6%, respectively,
in the first quarter. These results serve as strong indicators that our Buildings groups
performance should improve significantly in the coming periods, particularly in the second half of
the fiscal year.
Exclusive of special charges incurred in our Components group, operating income for our Coatings
and Components groups was comparable to last years levels, absorbing the net effect of steel price
volatility in the first quarter and the impact of a record number of weather-related work stoppages
during the period. There was a modest improvement in our Buildings groups operating results, but
we expect a more meaningful improvement going forward as a result of greater commercial discipline
embedded in our current backlog and the growing proportion of work coming from the commercial and
industrial markets, which points to increasing demand from our traditional customer base.
For the first quarter, sales were $190.1 million, up 4.3% from the $182.2 million reported in last
years first quarter. Gross profit margin was 17.6% compared to 17.8% in the year-ago first
quarter.
Selling, general and administrative expenses were $47.7 million, or 25.1% of revenues, inclusive of
$1.4 million in special charges and an $884,000 increase in non-cash stock compensation. This
compares to $44.6 million, or 24.5% of revenues in last years first quarter. The Company incurred
an operating loss of $14.1 million this quarter compared to an operating loss of $12.7 million in
the prior year period. Adjusted EBITDA, defined as earnings before interest, taxes, depreciation
and amortization, and cash and other non-cash items, in accordance with the Companys bank credit
agreement, was negative $4.4 million compared to negative $2.6 million in last years first
quarter.
For the first quarter, the Company reported a net loss applicable to common shares of $20.7
million, which included the accrual of preferred stock dividends and accretion of $6.2 million and
a non-cash beneficial conversion feature charge of $1.8 million. This compares to a net loss of
$18.8 million in the 2010 first quarter.
The adjusted loss per diluted common share, excluding the non-cash beneficial conversion charge and
other special charges presented in the attached tables, was $0.99; the reported net loss per
diluted common share was $1.14. This compares to an adjusted loss per diluted common share of $0.99
and a reported net loss per diluted common share of $1.04 in last years first quarter; each
adjusted for the 1-for-5 reverse split that was effective at the close of market on March 5, 2010.
The weighted average number of common shares used in the calculation was 18.1 million for both
first quarter 2011 and 2010 per share amounts.
Inventory levels increased 2.5% sequentially to $83.4 million, reflecting seasonal factors.
Annualized inventory turnover was 7.5 turns for the first quarter compared to 7.3 turns
year-over-year and 8.6 turns sequentially.
Capital expenditures were $2.2 million; net cash from operating activities was positive $132,000.
Additional Corporate Developments
For the second consecutive quarter, the Preferred Dividend Committee of the Board of Directors
elected to pay the $5.5 million preferred dividend in cash. As a result, we plan to record a
dividend accrual reversal of $1.4 million in the second quarter of fiscal 2011. In addition, we
plan to record a beneficial conversion feature reversal of $4.2 million in the second quarter of
fiscal 2011. The determination of cash payment versus payment in-kind or PIK of the preferred
dividends will be made each quarter adhering to the limitations of the Companys term loan and ABL
credit facilities as well as the Companys intermediate and long-term cash flow requirements. The
Companys term loan currently restricts the payment of cash dividends to 50% of cumulative earnings
beginning with the fourth quarter of 2009, and in the absence of accumulated earnings, cash
dividends and other restricted payments, is limited to $14.5 million in the aggregate during the
term of the loan.
First Quarter Segment Performance
The Company reported an adjusted operating loss of $12.8 million, which is reconciled with the
reported GAAP operating loss in the table below.
NCI BUILDING SYSTEMS, INC.
BUSINESS SEGMENTS
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS) EXCLUDING SPECIAL CHARGES
(Unaudited)
(In thousands)
BUSINESS SEGMENTS
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS) EXCLUDING SPECIAL CHARGES
(Unaudited)
(In thousands)
For the Three Months Ended January 30, 2011 | ||||||||||||||||||||
Engineered | ||||||||||||||||||||
Metal Coil | Metal | Building | ||||||||||||||||||
Coating | Components | Systems | Corporate | Consolidated | ||||||||||||||||
Operating income (loss), GAAP basis |
$ | 3,444 | $ | 353 | $ | (5,410 | ) | $ | (12,523 | ) | $ | (14,136 | ) | |||||||
Pre-acquisition contingency adjustment |
| | 252 | | 252 | |||||||||||||||
Increase in actuarial determined general liability self-insurance reserve |
| 1,101 | | | 1,101 | |||||||||||||||
Adjusted operating income (loss) (1) |
$ | 3,444 | $ | 1,454 | $ | (5,158 | ) | $ | (12,523 | ) | $ | (12,783 | ) | |||||||
(1) | The Company discloses a tabular comparison of Adjusted operating income (loss), which is a non-GAAP measure because it is instrumental in comparing the results from period to period. Adjusted operating income (loss) should not be considered in isolation or as a substitute for operating income (loss) as reported on the face of our statement of income. |
While each of our business segments continued to be affected by historically low market
demand and the typical seasonality associated with our first fiscal quarter, we continue to focus
on efficiency improvements throughout the organization designed to streamline operations as our
markets recover, Mr. Chambers said. We believe that NCIs vertically integrated business model
provides us with important competitive advantages that we can leverage as economic conditions
improve.
Revenues for the Coatings group increased 8.3% year-over-year, reflecting successful marketing
efforts in both traditional and non-traditional markets, as well as an increase in orders in
advance of steel price increases. Operating income increased 10.4%. Once operational, the recently
purchased sixth Coatings plant in Middletown, Ohio will support future growth in third party sales
and internal demand from the Components and Buildings groups as well as significantly increase the
Coatings groups footprint in an area of the country with important growth potential.
The Components groups revenues increased 4% from last years first quarter levels. In addition to
special charges, lower selling prices caused margin compression compared to last years first
quarter. The Components group increased sales of retrofit roofing products and energy-efficient
insulated metal panels in the quarter, and work has already begun on re-tooling two of the
Companys previously idled facilities to capitalize on increasing demand for energy efficient
insulated metal panels.
The Buildings groups revenues were comparable with first quarter 2010 levels and operating results
improved modestly despite lower volume. Investments in manufacturing efficiencies and significant
upgrades to engineering and drafting systems across all brands have positioned this group for
improved results as market demand strengthens.
Market Commentary
In the first fiscal quarter of 2011, low-rise nonresidential construction activity measured in
square feet declined 16% from the comparable period in fiscal 2010, as reported by McGraw-Hill.
The American Institute of Architects Architectural Billing Index published for January was 50.0
and the commercial and industrial component of the Index remained above 50 for the seventh
consecutive month.
McGraw-Hill is currently forecasting that nonresidential construction activity measured in square
feet will be 7% higher in calendar 2011 compared to calendar 2010, with most of the
improvement occurring in the second half of the year. McGraw-Hill projects CY 2011 square footage
at 695 million, up from 650 million in 2010.
Summary and Outlook
The pick-up in quoting activity that we signaled at the end of fiscal 2010 continued in the first
quarter. We are particularly encouraged by the 27% increase in bookings in the first fiscal quarter
and by the higher proportion of bookings and backlog represented by commercial/industrial work,
which prior to the economic downturn had accounted for 70% of our business. A sustained upturn in
this sector would significantly benefit NCI in future periods as we have retained the capacity to
serve a much larger marketplace with significantly reduced infrastructure costs, Mr. Chambers
noted.
In the meantime, we continue to enhance our competitive position by working diligently to roll-out
new sales initiatives, implement technical upgrades to increase efficiencies and train our
employees on new systems that will further improve customer service levels and reduce operating
costs.
The NCI Building Systems, Inc. first quarter conference call is scheduled for March 8, 2011, at
5:00 PM ET. Please call 1-412-858-4600 to participate in the call. To listen to a live broadcast of
the call over the Internet or to review the archived call, please visit the Companys website at
www.ncilp.com. To access the taped replay, please dial 1-412-317-0088 and the passcode 419727# when
prompted. The Webcast archive and taped replay will both be available two hours after the call
through March 15, 2011.
NCI Building Systems, Inc. is one of North Americas largest integrated manufacturers of metal
products for the nonresidential building industry. NCI is comprised of a family of companies
operating manufacturing facilities across the United States and Mexico, with additional sales and
distribution offices throughout the United States and Canada.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 and Section 27A of the Securities Act. These statements and other
statements identified by words such as believe, guidance, potential, expect,
should, will, forecast and similar expressions are forward-looking statements within the
meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements reflect our current expectations, assumptions and/or beliefs
concerning future events. As a result, these forward-looking statements rely on a number of
assumptions, forecasts, and estimates and, as a result, these forward-looking statements are
subject to a number of risks and uncertainties that may cause the Companys actual performance to
differ materially from that projected in such statements. Among the factors that could cause actual
results to differ materially include, but are not limited to industry cyclicality and seasonality
and adverse weather conditions; ability to service the Companys debt; fluctuations in customer
demand and other patterns; raw material pricing and supply; competitive activity and pricing
pressure; general economic conditions affecting the construction industry; financial crises or
fluctuations in the U.S. and abroad; changes in laws or regulations; and the volatility of the
Companys stock price. The Companys SEC filings, including our most recent reports on Form 10-K,
particularly under Item 1A Risk Factors in the Companys Annual Report on Form 10-K for the
fiscal year ended October 31, 2010, identify other important factors, though not necessarily all
such factors, that could cause future outcomes to differ materially from those set forth in the
forward-looking statements. NCI expressly disclaims any obligation to release publicly any updates
or revisions to these forward-looking statements to reflect any changes in its expectations.
NCI BUILDING SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
For the Three Months Ended | ||||||||
January 30, | January 31, | |||||||
2011 | 2010 | |||||||
Sales |
$ | 190,086 | $ | 182,207 | ||||
Cost of sales, excluding asset impairments |
156,541 | 148,740 | ||||||
Asset impairments |
| 1,029 | ||||||
Gross profit |
33,545 | 32,438 | ||||||
17.6 | % | 17.8 | % | |||||
Selling, general and administrative expenses |
47,681 | 44,646 | ||||||
Restructuring charges |
| 524 | ||||||
Loss from operations |
(14,136 | ) | (12,732 | ) | ||||
Interest income |
47 | 25 | ||||||
Interest expense |
(4,224 | ) | (4,532 | ) | ||||
Refinancing costs |
| (174 | ) | |||||
Other income, net |
579 | 1,148 | ||||||
Loss before income taxes |
(17,734 | ) | (16,265 | ) | ||||
Benefit from income taxes |
(5,009 | ) | (5,779 | ) | ||||
28.2 | % | 35.5 | % | |||||
Net loss |
$ | (12,725 | ) | $ | (10,486 | ) | ||
Convertible preferred stock dividends and accretion |
6,230 | 8,134 | ||||||
Convertible preferred stock beneficial conversion feature |
1,786 | 187 | ||||||
Net loss applicable to common shares |
$ | (20,741 | ) | $ | (18,807 | ) | ||
Loss per common share: |
||||||||
Basic |
$ | (1.14 | ) | $ | (1.04 | ) | ||
Diluted |
$ | (1.14 | ) | $ | (1.04 | ) | ||
Weighted average number of common shares outstanding: |
||||||||
Basic |
18,149 | 18,093 | ||||||
Diluted |
18,149 | 18,093 | ||||||
Increase in sales |
4.3 | % | ||||||
Gross profit percentage |
17.6 | % | 17.8 | % | ||||
Selling, general and administrative
expenses percentage |
25.1 | % | 24.5 | % |
NCI BUILDING SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
CONSOLIDATED BALANCE SHEETS
(In thousands)
January 30, | October 31, | |||||||
2011 | 2010 | |||||||
(Unaudited) | ||||||||
ASSETS |
||||||||
Cash and cash equivalents |
$ | 65,216 | $ | 77,419 | ||||
Restricted cash |
2,841 | 2,839 | ||||||
Accounts receivable, net |
61,916 | 81,896 | ||||||
Inventories, net |
83,448 | 81,386 | ||||||
Deferred income taxes |
15,101 | 15,101 | ||||||
Income taxes receivable |
15,553 | 15,919 | ||||||
Prepaid expenses and other |
14,326 | 13,923 | ||||||
Investments in debt and equity securities, at market |
4,006 | 3,738 | ||||||
Assets held for sale |
6,114 | 6,114 | ||||||
Total current assets |
268,521 | 298,335 | ||||||
Property and equipment, net |
209,904 | 214,453 | ||||||
Goodwill |
5,200 | 5,200 | ||||||
Intangible assets, net |
25,797 | 26,312 | ||||||
Other assets |
15,062 | 16,224 | ||||||
Total assets |
$ | 524,484 | $ | 560,524 | ||||
LIABILITIES AND STOCKHOLDERS DEFICIT |
||||||||
Note payable |
$ | | $ | 289 | ||||
Accounts payable |
63,599 | 70,589 | ||||||
Accrued compensation and benefits |
31,162 | 31,731 | ||||||
Accrued interest |
1,481 | 1,546 | ||||||
Other accrued expenses |
44,440 | 46,723 | ||||||
Total current liabilities |
140,682 | 150,878 | ||||||
Long-term debt |
133,555 | 136,305 | ||||||
Deferred income taxes |
5,448 | 10,947 | ||||||
Other long-term liabilities |
4,813 | 4,820 | ||||||
Total long-term liabilities |
143,816 | 152,072 | ||||||
Series B cumulative convertible participating preferred stock |
257,550 | 256,870 | ||||||
Redeemable common stock |
2,464 | 3,418 | ||||||
Common stock |
923 | 921 | ||||||
Additional paid-in capital |
250,667 | 255,248 | ||||||
Accumulated deficit |
(269,671 | ) | (256,946 | ) | ||||
Accumulated other comprehensive loss |
(1,947 | ) | (1,937 | ) | ||||
Total stockholders deficit |
(20,028 | ) | (2,714 | ) | ||||
Total liabilities and stockholders deficit |
$ | 524,484 | $ | 560,524 | ||||
| |
NCI BUILDING SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
For the Three Months Ended | ||||||||
January 30, 2011 | January 31, 2010 | |||||||
Cash flows from operating activities: |
||||||||
Net loss |
$ | (12,725 | ) | $ | (10,486 | ) | ||
Adjustments to reconcile net loss to net cash provided by (used in)
operating activities: |
||||||||
Depreciation and amortization |
8,449 | 8,701 | ||||||
Share-based compensation expense |
1,685 | 801 | ||||||
Gain on embedded derivative |
(7 | ) | (919 | ) | ||||
(Gain) loss on sale of property, plant and equipment |
(18 | ) | 103 | |||||
Provision for doubtful accounts |
457 | (416 | ) | |||||
Asset impairments |
| 1,029 | ||||||
Provision (benefit) for deferred income taxes |
(5,035 | ) | 45 | |||||
Changes in working capital |
||||||||
Accounts receivable |
19,523 | 22,231 | ||||||
Inventories |
(2,062 | ) | (18,443 | ) | ||||
Income tax receivable |
366 | (4,253 | ) | |||||
Prepaid expenses and other |
(642 | ) | (233 | ) | ||||
Accounts payable |
(6,990 | ) | (5,056 | ) | ||||
Accrued expenses |
(2,892 | ) | (12,248 | ) | ||||
Other, net |
23 | (32 | ) | |||||
Net cash provided by (used in) operating activities |
132 | (19,176 | ) | |||||
Cash flows from investing activities: |
||||||||
Capital expenditures |
(2,247 | ) | (1,287 | ) | ||||
Proceeds from sale of assets |
41 | 52 | ||||||
Net cash used in investing activities |
(2,206 | ) | (1,235 | ) | ||||
Cash flows from financing activities: |
||||||||
Payment of convertible notes |
| (59 | ) | |||||
Net borrowing on revolver (ABL) |
| 3 | ||||||
(Decrease) increase of restricted cash |
(2 | ) | 8,772 | |||||
Payment of cash dividends on Convertible Preferred Stock |
(5,550 | ) | | |||||
Payment on term loan |
(2,750 | ) | | |||||
Payments on notes payable |
(289 | ) | (481 | ) | ||||
Payment on other long-term debt |
| (190 | ) | |||||
Payment of financing costs |
(50 | ) | | |||||
Purchase of treasury stock |
(1,478 | ) | (379 | ) | ||||
Net cash (used in) provided by financing activities |
(10,119 | ) | 7,666 | |||||
Effect of exchange rate changes on cash and cash equivalents |
(10 | ) | (8 | ) | ||||
Net decrease in cash |
(12,203 | ) | (12,753 | ) | ||||
Cash at beginning of period |
77,419 | 90,419 | ||||||
Cash at end of period |
$ | 65,216 | $ | 77,666 | ||||
NCI Building Systems, Inc.
Business Segments
(Unaudited)
(In thousands)
Business Segments
(Unaudited)
(In thousands)
Three Months Ended | Three Months Ended | $ | % | |||||||||||||||||||||
January 30, 2011 | January 31, 2010 | Inc/(Dec) | Change | |||||||||||||||||||||
% of | % of | |||||||||||||||||||||||
Total | Total | |||||||||||||||||||||||
Sales | Sales | |||||||||||||||||||||||
Sales: |
||||||||||||||||||||||||
Metal coil coating |
$ | 42,274 | 22 | $ | 39,031 | 21 | $ | 3,243 | 8.3 | % | ||||||||||||||
Metal components |
90,305 | 48 | 86,806 | 48 | 3,499 | 4.0 | % | |||||||||||||||||
Engineered building systems |
101,412 | 53 | 101,938 | 56 | (526 | ) | -0.5 | % | ||||||||||||||||
Intersegment sales |
(43,905 | ) | (23 | ) | (45,568 | ) | (25 | ) | 1,663 | -3.6 | % | |||||||||||||
Total net sales |
$ | 190,086 | 100 | $ | 182,207 | 100 | $ | 7,879 | 4.3 | % | ||||||||||||||
% of | % of | |||||||||||||||||||||||
Sales | Sales | |||||||||||||||||||||||
Operating income (loss): |
||||||||||||||||||||||||
Metal coil coating |
$ | 3,444 | 8 | $ | 3,119 | 8 | $ | 325 | 10.4 | % | ||||||||||||||
Metal components |
353 | 0 | 1,791 | 2 | (1,438 | ) | -80.3 | % | ||||||||||||||||
Engineered building systems |
(5,410 | ) | (5 | ) | (5,818 | ) | (6 | ) | 408 | -7.0 | % | |||||||||||||
Corporate |
(12,523 | ) | | (11,824 | ) | | (699 | ) | -5.9 | % | ||||||||||||||
Total operating income (loss) (% of sales) |
$ | (14,136 | ) | (7 | ) | $ | (12,732 | ) | (7 | ) | $ | (1,404 | ) | -11.0 | % | |||||||||
NCI BUILDING SYSTEMS, INC.
BUSINESS SEGMENTS
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS) EXCLUDING SPECIAL CHARGES
FOR THE THREE MONTHS ENDED JANUARY 30, 2011 AND JANUARY 31, 2010
(Unaudited)
(In thousands)
BUSINESS SEGMENTS
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS) EXCLUDING SPECIAL CHARGES
FOR THE THREE MONTHS ENDED JANUARY 30, 2011 AND JANUARY 31, 2010
(Unaudited)
(In thousands)
For the Three Months Ended January 30, 2011 | ||||||||||||||||||||
Engineered | ||||||||||||||||||||
Building | ||||||||||||||||||||
Metal Coil Coating | Metal Components | Systems | Corporate | Consolidated | ||||||||||||||||
Operating income (loss), GAAP basis |
$ | 3,444 | $ | 353 | $ | (5,410 | ) | $ | (12,523 | ) | $ | (14,136 | ) | |||||||
Pre-acquisition contingency adjustment |
| | 252 | | 252 | |||||||||||||||
Increase in actuarial determined general liability
self-insurance reserve |
| 1,101 | | | 1,101 | |||||||||||||||
Adjusted operating income (loss) (1) |
$ | 3,444 | $ | 1,454 | $ | (5,158 | ) | $ | (12,523 | ) | $ | (12,783 | ) | |||||||
For the Three Months Ended January 31, 2010 | ||||||||||||||||||||
Engineered | ||||||||||||||||||||
Building | ||||||||||||||||||||
Metal Coil Coating | Metal Components | Systems | Corporate | Consolidated | ||||||||||||||||
Operating income (loss), GAAP basis |
$ | 3,119 | $ | 1,791 | $ | (5,818 | ) | $ | (11,824 | ) | $ | (12,732 | ) | |||||||
Restructuring charges |
| 109 | 415 | | 524 | |||||||||||||||
Asset impairments |
| | 1,029 | | 1,029 | |||||||||||||||
Adjusted operating income (loss) (1) |
$ | 3,119 | $ | 1,900 | $ | (4,374 | ) | $ | (11,824 | ) | $ | (11,179 | ) | |||||||
(1) | The Company discloses a tabular comparison of Adjusted operating income (loss), which is a non-GAAP measure because it is instrumental in comparing the results from period to period. Adjusted operating income (loss) should not be considered in isolation or as a substitute for operating income (loss) as reported on the face of our statement of operations. |
NCI BUILDING SYSTEMS, INC.
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
COMPUTATION OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION,
AMORTIZATION AND OTHER NONCASH ITEMS (ADJUSTED EBITDA)
(Unaudited)
(In thousands)
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
COMPUTATION OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION,
AMORTIZATION AND OTHER NONCASH ITEMS (ADJUSTED EBITDA)
(Unaudited)
(In thousands)
2nd Qtr | 3rd Qtr | 4th Qtr | 1st Qtr | Trailing 12 Months | ||||||||||||||||
May 2, | August 1, | October 31, | January 30, | January 30, | ||||||||||||||||
2010 | 2010 | 2010 | 2011 | 2011 | ||||||||||||||||
Net loss |
$ | (7,656 | ) | $ | (3,299 | ) | $ | (5,436 | ) | $ | (12,725 | ) | $ | (29,116 | ) | |||||
Add: |
||||||||||||||||||||
Depreciation and amortization |
7,480 | 7,457 | 7,309 | 7,236 | 29,482 | |||||||||||||||
Consolidated interest expense, net |
4,670 | 4,392 | 4,258 | 4,177 | 17,497 | |||||||||||||||
Provision for taxes |
(5,536 | ) | (221 | ) | (1,794 | ) | (5,009 | ) | (12,560 | ) | ||||||||||
Non-cash charges: |
||||||||||||||||||||
Stock-based compensation |
1,403 | 1,374 | 1,375 | 1,685 | 5,837 | |||||||||||||||
Asset impairments, recoveries |
(116 | ) | (64 | ) | 221 | | 41 | |||||||||||||
Embedded derivative |
(4 | ) | (7 | ) | (7 | ) | (7 | ) | (25 | ) | ||||||||||
Pre-acquisition contingency
adjustment |
| | 178 | 252 | 430 | |||||||||||||||
Cash restructuring charges |
829 | 551 | 1,628 | | 3,008 | |||||||||||||||
Transaction costs |
| | (250 | ) | | (250 | ) | |||||||||||||
Adjusted EBITDA (1) |
$ | 1,070 | $ | 10,183 | $ | 7,482 | $ | (4,391 | ) | $ | 14,344 | |||||||||
2nd Qtr | 3rd Qtr | 4th Qtr | 1st Qtr | Trailing 12 Months | ||||||||||||||||
May 3, | August 2, | November 1, | January 31, | January 31, | ||||||||||||||||
2009 | 2009 | 2009 | 2010 | 2010 | ||||||||||||||||
Net income (loss) |
$ | (121,571 | ) | $ | 2,607 | $ | (101,851 | ) | $ | (10,486 | ) | $ | (231,301 | ) | ||||||
Add: |
||||||||||||||||||||
Depreciation and amortization |
8,436 | 7,586 | 7,640 | 7,521 | 31,183 | |||||||||||||||
Consolidated interest expense, net |
6,168 | 6,487 | 9,578 | 4,507 | 26,740 | |||||||||||||||
Provision for taxes |
(16,382 | ) | 1,825 | (7,495 | ) | (5,779 | ) | (27,831 | ) | |||||||||||
Non-cash charges: |
||||||||||||||||||||
Stock-based compensation |
1,177 | 1,241 | 1,045 | 801 | 4,264 | |||||||||||||||
Goodwill and intangible impairment |
104,936 | | | | 104,936 | |||||||||||||||
Asset impairments |
5,295 | 26 | 347 | 1,029 | 6,697 | |||||||||||||||
Lower of cost or market charges |
10,608 | | | | 10,608 | |||||||||||||||
Embedded derivative |
| | | (919 | ) | (919 | ) | |||||||||||||
Cash restructuring charges |
3,796 | 1,213 | 1,564 | 524 | 7,097 | |||||||||||||||
Transaction costs |
629 | 401 | 107,718 | 174 | 108,922 | |||||||||||||||
Adjusted EBITDA (1) |
$ | 3,092 | $ | 21,386 | $ | 18,546 | $ | (2,628 | ) | $ | 40,396 | |||||||||
(1) | On October 20, 2009, the Company amended and restated its Term Note facility which defines adjusted EBITDA. Adjusted EBITDA excludes non-cash charges for goodwill and other asset impairments, lower of cost or market charges and stock compensation as well as certain non-recurring charges. As such, the historical information is presented in accordance with the definition above. Concurrent with the amendment and restatement of the term note facility, the Company entered into an Asset-Backed Lending facility which has substantially the same definition of adjusted EBITDA except that the ABL facility caps certain non-recurring charges. The Company is disclosing adjusted EBITDA, which is a non-GAAP measure, because it is used by management and provided to investors to provide comparability of underlying operational results. |
NCI BUILDING SYSTEMS, INC.
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
ADJUSTED LOSS PER DILUTED COMMON SHARE AND NET LOSS COMPARISON
(Unaudited)
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
ADJUSTED LOSS PER DILUTED COMMON SHARE AND NET LOSS COMPARISON
(Unaudited)
Fiscal Three Months Ended | ||||||||
January 30, | January 31, | |||||||
2011 | 2010 | |||||||
Loss per diluted common share, GAAP basis |
$ | (1.14 | ) | $ | (1.04 | ) | ||
Refinancing costs |
| 0.01 | ||||||
Convertible preferred stock beneficial conversion feature |
0.10 | 0.01 | ||||||
Restructuring charges |
| 0.02 | ||||||
Asset impairments |
| 0.04 | ||||||
Gain on embedded derivative |
(0.00 | ) | (0.03 | ) | ||||
Increase in actuarial determined general liability self-insurance reserve |
0.04 | | ||||||
Pre-acquisition contingency adjustment |
0.01 | | ||||||
Adjusted diluted loss per common share (1) |
$ | (0.99 | ) | $ | (0.99 | ) | ||
Fiscal Three Months Ended | ||||||||
January 30, | January 31, | |||||||
2011 | 2010 | |||||||
Net loss applicable to common shares, GAAP basis |
$ | (20,741 | ) | $ | (18,807 | ) | ||
Refinancing costs |
| 113 | ||||||
Convertible preferred stock beneficial conversion feature |
1,786 | 187 | ||||||
Restructuring charges |
| 340 | ||||||
Asset impairments |
| 669 | ||||||
Gain on embedded derivative |
(5 | ) | (597 | ) | ||||
Increase in actuarial determined general liability self-insurance reserve |
790 | | ||||||
Pre-acquisition contingency adjustment |
181 | | ||||||
Adjusted net loss applicable to common shares (1) |
$ | (17,989 | ) | $ | (18,095 | ) | ||
(1) | The Company discloses a tabular comparison of Adjusted loss per diluted common share and net loss, which are non-GAAP measures, because they are referred to in the text of our press releases and are instrumental in comparing the results from period to period. Adjusted diluted loss per common share and net loss should not be considered in isolation or as a substitute for loss per diluted common share and net loss as reported on the face of our statement of income. |
NCI Building Systems, Inc.
Reconciliation of Segment Sales to Third Party Segment Sales (Internal Information)
(Unaudited)
(In thousands)
Reconciliation of Segment Sales to Third Party Segment Sales (Internal Information)
(Unaudited)
(In thousands)
% | ||||||||||||||||||||||||
1st Qtr 2011 | 1st Qtr 2010 | Inc/(Dec) | Change | |||||||||||||||||||||
Metal Coil Coating |
||||||||||||||||||||||||
Total Sales |
42,274 | 18 | % | 39,031 | 17 | % | 3,243 | 8 | % | |||||||||||||||
Intersegment |
(25,081 | ) | (26,223 | ) | 1,142 | -4 | % | |||||||||||||||||
Third Party Sales |
17,193 | 9 | % | 12,808 | 7 | % | 4,385 | 34 | % | |||||||||||||||
Operating Income
(Loss) |
3,444 | 20 | % | 3,119 | 24 | % | 325 | 10 | % | |||||||||||||||
Metal Components |
||||||||||||||||||||||||
Total |
90,305 | 39 | % | 86,806 | 38 | % | 3,499 | 4 | % | |||||||||||||||
Intersegment |
(16,289 | ) | (16,668 | ) | 379 | -2 | % | |||||||||||||||||
Third Party Sales |
74,016 | 39 | % | 70,138 | 39 | % | 3,878 | 6 | % | |||||||||||||||
Operating Income
(Loss) |
353 | 0 | % | 1,791 | 3 | % | (1,438 | ) | -80 | % | ||||||||||||||
Engineered Building Systems |
||||||||||||||||||||||||
Total |
101,412 | 43 | % | 101,938 | 45 | % | (526 | ) | -1 | % | ||||||||||||||
Intersegment |
(2,535 | ) | (2,677 | ) | 142 | -5 | % | |||||||||||||||||
Third Party Sales |
98,877 | 52 | % | 99,261 | 54 | % | (384 | ) | 0 | % | ||||||||||||||
Operating Income
(Loss) |
(5,410 | ) | -5 | % | (5,818 | ) | -6 | % | 408 | 7 | % | |||||||||||||
Consolidated |
||||||||||||||||||||||||
Total |
233,991 | 100 | % | 227,775 | 100 | % | 6,216 | 3 | % | |||||||||||||||
Intersegment |
(43,905 | ) | (45,568 | ) | 1,663 | -4 | % | |||||||||||||||||
Third Party Sales |
190,086 | 100 | % | 182,207 | 100 | % | 7,879 | 4 | % | |||||||||||||||
Operating Income
(Loss) |
(14,136 | ) | -7 | % | (12,732 | ) | -7 | % | (1,404 | ) | -11 | % |