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8-K - 8-K - Wesco Aircraft Holdings, Inca13-3851_18k.htm
EX-99.2 - EX-99.2 - Wesco Aircraft Holdings, Inca13-3851_1ex99d2.htm

Exhibit 99.1

 

Wesco Aircraft Holdings Reports Results for Fiscal First Quarter 2013

 

VALENCIA, CA, January 29, 2013 — Wesco Aircraft Holdings, Inc. (“Wesco Aircraft” or the “Company”) (NYSE: WAIR), a leading provider of comprehensive supply chain management services to the global aerospace industry, today announced results for its fiscal first quarter ended December 31, 2012.

 

Highlights

 

·                  Revenue of $211.2 million, up 9.7% compared to $192.6 million in the prior year

·                  Net Income of $18.4 million, with Diluted Earnings Per Share of $0.19

·                  Adjusted Net Income of  $24.1 million, with Adjusted Diluted Earnings Per Share of $0.25

·                  Full year 2013 guidance unchanged for sales of $865 to $890 million, Diluted EPS of $1.08 to $1.12, and Adjusted Diluted EPS of $1.14 to $1.19.

 

Fiscal 2013 First Quarter Results

 

Revenue for the first fiscal quarter was $211.2 million, an increase of 9.7% compared to $192.6 million in the prior year period.  The increase in the North America segment was 10.3% which was mainly driven by the Interfast acquisition.  Wesco again demonstrated strong international growth during the quarter with revenues in the Rest of World segment increasing by 32.9% compared to the prior year.  In the first quarter, Ad Hoc, JIT and LTA sales as a percentage of net sales represented 40%, 26% and 34%, respectively, compared to 35%, 31% and 34%, respectively, for the same period last year.

 

Net income for the first quarter was $18.4 million, resulting in Diluted Earnings Per Share of $0.19. This compares to $23.2 million, or $0.24 per share in the prior year period.  The reduction in Diluted Earnings Per Share was primarily the result of a write-off of deferred financing costs associated with the recent refinancing of the Company’s debt and credit facilities (approx. $0.03 per share) and integration costs associated with the recent acquisition of Interfast ($0.01 per share).  Excluding these and other unusual items, Adjusted Net Income was $24.1 million and Adjusted Earnings Per Share was $0.25 in the first quarter of 2013 as compared to $24.3 million or $0.26 per share in the prior year period.  The current year period benefitted from higher sales, primarily due to the Interfast acquisition, and a lower tax rate.  Offsetting this benefit were slightly lower gross margins as our lower margin electronics products sales grew more rapidly than our hardware sales and the addition of SG&A costs associated with the Interfast business.

 

Wesco Aircraft’s Chairman, President and Chief Executive Officer, Randy Snyder said, “Our first quarter results were strong and give us high confidence in our full year guidance for sales growth and earnings per share.  We are experiencing high levels of activity in bookings, additions to our current contracts, and contract signings with new customers, which adds to our optimism for the rest of the year and beyond.  The Interfast integration is also going very well and exceeding my expectations.  None of this would

 



 

be achievable without our strong customer relationships, the support of our suppliers and the dedicated efforts of the best employees in the business.”

 

Financial Outlook

 

Based on our performance during the first quarter, Wesco reiterates its guidance for 2013 and expects full year revenues to be between $865 and $890 million, representing a growth rate of approximately 11% to 15% over 2012 results. Diluted EPS and Adjusted Diluted EPS are expected to be in the range of $1.08 to $1.12, and $1.14 to $1.19, respectively.

 

Conference Call Information

 

Wesco Aircraft will also hold a conference call to discuss its first quarter results at 5:00 p.m. EST on January 29, 2013.  The conference call can be accessed by dialing 866-825-3308 (domestic) or 617-213-8062 (international).  Participants will need to enter passcode 41826718.

 

The conference call will be simultaneously broadcast on Wesco Aircraft’s Investor Relations website (http://ir.wescoair.com).

 

Following the live webcast, a replay will be available on the Company’s website for one year.  A telephonic replay will also be available approximately one hour after the conference call and may be accessed by dialing 888-286-8010 (domestic) or 617-801-6888 (international) and entering passcode 57269261.  The telephonic replay will be available until February 5, 2013.

 

About Wesco Aircraft

 

Wesco Aircraft is one of the world’s largest distributors and providers of comprehensive supply chain management services to the global aerospace industry.  The Company’s services range from traditional distribution to the management of supplier relationships, quality assurance, kitting, just-in-time delivery and point-of-use inventory management.  The Company believes it offers the world’s broadest inventory of aerospace parts, comprised of more than 500,000 different stock keeping units, including hardware, bearings, tools, electronic components and machined parts. Wesco Aircraft has more than 1,200 employees across 41 locations in 12 countries.

 

To learn more about Wesco Aircraft, visit our website at www.wescoair.com.

 



 

Non-GAAP Financial Information

 

‘‘Adjusted Net Income’’ represents Net Income before: (i) amortization of intangible assets, (ii) amortization or write-off of deferred financing costs and original issue discount, or OID, (iii) unusual or non-recurring items and (iv) the tax effect of items (i) through (iii) above calculated using an assumed effective tax rate.

 

“Adjusted Basic EPS” represents Basic EPS calculated using Adjusted Net Income as opposed to Net Income.

 

“Adjusted Diluted EPS” represents Diluted EPS calculated using Adjusted Net Income as opposed to Net Income.

 

‘‘Adjusted EBITDA’’ represents Net Income before: (i) income tax provision, (ii) net interest expense, (iii) depreciation and amortization, (iv) Carlyle Acquisition related non-cash stock-based compensation expense and (v) unusual or non-recurring items.

 

Wesco utilizes and discusses Adjusted Net Income, Adjusted Basic EPS, Adjusted Diluted EPS and Adjusted EBITDA, which are non-GAAP measures our management uses to evaluate our business, because we believe they assist investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.  We believe these metrics are used in the financial community, and we present these metrics to enhance investors’ understanding of our operating performance.  You should not consider Adjusted EBITDA and Adjusted Net Income as an alternative to Net Income, determined in accordance with GAAP, as an indicator of operating performance. Adjusted Net Income, Adjusted Basic EPS, Adjusted Diluted EPS and Adjusted EBITDA are not measurements of financial performance under GAAP, and these metrics may not be comparable to similarly titled measures of other companies.  See below for a reconciliation of Adjusted Net Income, Adjusted Basic EPS, Adjusted Diluted EPS and Adjusted EBITDA to the most directly comparable financial measures calculated and presented in accordance with GAAP.

 

Forward Looking Statements

 

Certain information in this news release contains forward-looking statements with respect to the Company’s financial condition, results of operations or business or its expectations or beliefs concerning future events.  Such forward-looking statements include the discussions of the Company’s business strategies and the Company’s expectations concerning future operations, revenues, earnings per share, margins, profitability, liquidity and capital resources.  In some cases, you can identify forward-looking statements by terminology such as “guidance,” “may,” “will,” “could,” “should,” “forecasts,” “expects,” “intends,” “plans,” “anticipates,” “projects,” “outlook,” “believes,” “estimates,” “predicts,” “potential,” “continue,” “preliminary,” or the negative of these terms or other comparable terminology.  Although the Company believes that such forward-looking statements are reasonable, it cannot assure you that any forward-looking statements will prove to be correct.  Such forward-looking

 



 

statements involve risks, uncertainties, estimates and assumptions that may cause the Company’s actual results, performance or achievements to be materially different than those set forth in this news release.  Additional information relating to factors that may cause actual results to differ from the Company’s forward-looking statements can be found in the Company’s filings with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2012 filed on November 30, 2012. The Company undertakes no obligation to update or revise forward-looking statements after the day of the release as a result of new information, future events or developments except as required by law.

 

Exhibits

 

Exhibit 1:

 

Consolidated Statements of Income (Unaudited)

 

 

 

Exhibit 2:

 

Condensed Consolidated Balance Sheets (Unaudited)

 

 

 

Exhibit 3:

 

Condensed Consolidated Statements of Cash Flows (Unaudited)

 

 

 

Exhibit 4:

 

Non-GAAP Financial Information (Unaudited)

 



 

Exhibit 1

 

Wesco Aircraft Holdings, Inc.

Consolidated Statements of Income (UNAUDITED)

(In thousands, except for per share data)

 

 

 

Three Months Ended

 

 

 

December 31,
2012

 

December 31,
2011

 

 

 

 

 

 

 

Net sales

 

$

211,170

 

$

192,554

 

Cost of sales

 

137,070

 

119,282

 

Gross profit

 

74,100

 

73,272

 

Selling, general and administrative expenses

 

34,725

 

28,193

 

Income from operations

 

39,375

 

45,079

 

Interest expense, net

 

(11,377

)

(6,514

)

Other expense, net

 

(155

)

(22

)

Income before provision for income taxes

 

27,843

 

38,543

 

Provision for income taxes

 

(9,417

)

(15,365

)

Net income

 

$

18,426

 

$

23,178

 

 

 

 

 

 

 

Net income per share:

 

 

 

 

 

Basic

 

$

0.20

 

$

0.25

 

Diluted

 

$

0.19

 

$

0.24

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

Basic

 

92,514

 

91,198

 

Diluted

 

95,179

 

94,979

 

 



 

Exhibit 2

 

Wesco Aircraft Holdings, Inc.

Condensed Consolidated Balance Sheets (UNAUDITED)

(In thousands)

 

 

 

December 31,
2012

 

September 30,
2012

 

 

 

 

 

 

 

Assets

 

 

 

 

 

Cash and cash equivalents

 

$

39,734

 

$

60,856

 

Accounts receivable, net

 

129,667

 

130,013

 

Inventories

 

572,731

 

557,216

 

Other current assets

 

53,764

 

53,944

 

Deferred income taxes

 

32,396

 

32,872

 

Total current assets

 

828,292

 

834,901

 

Long-term assets

 

702,586

 

702,515

 

Total assets

 

$

1,530,878

 

$

1,537,416

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

Accounts payable

 

$

72,862

 

$

79,940

 

Other current liabilities

 

14,758

 

19,788

 

Income taxes payable

 

2,843

 

2,078

 

Long-term debt—current portion

 

21,250

 

 

Capital lease obligations—current portion

 

1,085

 

593

 

Total current liabilities

 

112,798

 

102,399

 

Long-term debt

 

593,750

 

626,000

 

Capital lease obligations

 

1,342

 

205

 

Deferred income taxes

 

57,647

 

55,445

 

Total Long-term liabilities

 

652,739

 

681,650

 

Total liabilities

 

765,537

 

784,049

 

Total stockholders’ equity

 

765,341

 

753,367

 

Total liabilities and stockholders’ equity

 

$

1,530,878

 

$

1,537,416

 

 



 

Exhibit 3

 

Wesco Aircraft Holdings, Inc.

Condensed Consolidated Statements of Cash Flows (UNAUDITED)

(In thousands)

 

 

 

Three Months Ended

 

 

 

December 31,
2012

 

December 31,
2011

 

Cash flows from operating activities

 

 

 

 

 

Net income

 

$

18,426

 

$

23,178

 

Adjustments to reconcile net income to net cash provided by operating activities

 

 

 

 

 

Amortization of intangible assets

 

1,663

 

923

 

Depreciation

 

1,253

 

1,459

 

Amortization of deferred financing costs

 

5,664

 

998

 

Bad debt and sales return reserve

 

(18

)

(90

)

Non-cash foreign currency exchange

 

230

 

(39

)

Non-cash stock-based compensation

 

987

 

665

 

Excess tax benefit related to stock options exercised

 

(741

)

 

Change in value of derivative

 

 

(734

)

Deferred income tax provision

 

2,677

 

2,070

 

Loss on fixed asset disposal

 

 

339

 

Changes in assets and liabilities

 

 

 

 

 

Accounts receivable

 

(1,343

)

(3,252

)

Income taxes receivable

 

3,891

 

5,808

 

Inventories

 

(16,034

)

(5,382

)

Prepaid expenses and other assets

 

(2,885

)

(2,008

)

Accounts payable

 

(5,460

)

2,682

 

Accrued expenses and other liabilities

 

(5,017

)

(6,663

)

Income taxes payable

 

788

 

2,643

 

Net cash provided by operating activities

 

4,081

 

22,597

 

Cash flows from investing activities

 

 

 

 

 

Purchases of property and equipment

 

(597

)

(644

)

Proceeds from sale of equipment

 

 

2,759

 

Net cash provided by (used in) investing activities

 

(597

)

2,115

 

Cash flows from financing activities

 

 

 

 

 

Proceeds from issuance of long-term debt

 

615,000

 

 

Repayments of long-term debt

 

(626,000

)

(25,000

)

Financing fees

 

(7,274

)

 

Repayment of capital lease obligations

 

(341

)

(521

)

Excess tax benefit related to stock options exercised

 

741

 

 

Proceeds from exercise of stock options

 

1,787

 

 

Purchase of Treasury Stock

 

(8,452

)

 

Net cash used in financing activities

 

(24,539

)

(25,521

)

Effect of foreign currency exchange rates on cash and cash equivalents

 

(67

)

(41

)

Net decrease in cash and cash equivalents

 

(21,122

)

(850

)

Cash and cash equivalents, beginning of period

 

60,856

 

45,525

 

Cash and cash equivalents, end of period

 

$

39,734

 

$

44,675

 

 



 

Exhibit 4

 

Wesco Aircraft Holdings, Inc.

Non-GAAP Financial Information (UNAUDITED)

(In thousands, except for per share data)

 

 

 

Three Months Ended

 

 

 

December 31,
2012

 

December 31,
2011

 

 

 

 

 

 

 

EBITDA & Adjusted EBITDA

 

 

 

 

 

Net income

 

$

18,426

 

$

23,178

 

Provision for income taxes

 

9,417

 

15,365

 

Interest and other, net

 

11,377

 

6,514

 

Depreciation and amortization

 

2,916

 

2,382

 

EBITDA

 

42,136

 

47,439

 

Unusual or non-recurring items

 

1,454

 

 

Adjusted EBITDA

 

$

43,590

 

$

47,439

 

 

 

 

 

 

 

Adjusted Net Income

 

 

 

 

 

Net income

 

$

18,426

 

$

23,178

 

Amortization of intangible assets

 

1,663

 

923

 

Amortization of deferred financing costs

 

5,664

 

998

 

Unusual or non-recurring items

 

1,454

 

 

Adjustments for tax effect

 

(3,082

)

(768

)

Adjusted Net Income

 

$

24,125

 

$

24,331

 

 

 

 

 

 

 

Adjusted Basic Earnings Per Share

 

 

 

 

 

Weighted-average number of basic shares outstanding

 

92,514

 

91,198

 

Adjusted Net Income Per Basic Shares

 

$

0.26

 

$

0.27

 

 

 

 

 

 

 

Adjusted Diluted Earnings Per Share

 

 

 

 

 

Weighted-average number of diluted shares outstanding

 

95,179

 

94,979

 

Adjusted Net Income Per Diluted Shares

 

$

0.25

 

$

0.26

 

 



 

Contact Information

 

Mark Davidson

Investor Relations

661-802-5090

Mark.Davidson@wescoair.com