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8-K - BUCKEYE TECHNOLOGIES INC. 8-K - BUCKEYE TECHNOLOGIES INC | a50546821.htm |
Exhibit 99.1
Buckeye’s Second Quarter FY 2013 Results
2Q-FY13 shipment volume up 6% vs. 2Q-FY12; up 22% vs. 1Q-FY13
Foley production rate fully recovered from June steam drum failure outage
Strong cash flow from operations reinvested in Foley specialty expansion project
MEMPHIS, Tenn.--(BUSINESS WIRE)--January 29, 2013--Buckeye Technologies Inc. (NYSE:BKI) today announced second quarter net sales of $204.3 million and adjusted net income* of $23.6 million. Adjusted EPS* of $0.60 compared to $0.69 in 2Q-FY12 and $0.62 in 1Q-FY13. Net insurance recovery in 2Q-FY13 was $0.04 per share less than expected.
Net sales for the quarter were down $17.1 million or 8% compared to the year ago quarter. While shipment volume was up 6% year over year, product mix was unfavorable as we shipped about 12,000 tons into the viscose staple fiber market during the quarter as a result of weak demand in some of our high-end markets, particularly from the European tire cord market. The sale of the Merfin Systems converting business in the third quarter of fiscal 2012 accounted for $4.3 million of this reduction in net sales.
Adjusted operating income* of $36.4 million was down $6.7 million compared to the year ago quarter, largely due to unfavorable product mix, in spite of a $6.8 million net insurance benefit related to the June steam drum failure outage at Foley.
Adjusted net income* of $23.6 million, or $0.60 per share, excludes after-tax restructuring and asset impairment charges of $10.7 million or $0.27 per share relating to the closure of our Delta airlaid nonwovens plant, which ceased production in November. Adjusted net income* was down $4.3 million or $0.09 per share compared to the prior year period’s $27.9 million or $0.69 per share, which excluded after-tax costs of $3.6 million or $0.09 per share relating to the cellulosic biofuel credit, and after-tax impairment costs of $29.7 million or $0.74 per share relating to the sale of Merfin Systems and the closure of our cotton specialty fibers plant in Americana, Brazil.
Comparison with 1Q 2013
Comparing 2Q 2013 to 1Q 2013, sales were up $7.4 million or 4%. This was driven by a 31% increase in shipment volume from the Foley specialty wood fibers facility compared to a first quarter heavily impacted by the June steam drum failure outage. Shipment volume from our Memphis specialty cotton fibers plant was down 16% in spite of a small pick-up in demand for acetate pulp from the LCD market, and Nonwovens shipment volume was off 8% due to the end of production at our Delta plant and normal seasonal weakness. Adjusted operating income* was down $2.6 million as the favorable impact from the final insurance settlement related to the June outage and increased shipment volume was not enough to offset the unfavorable product mix impact and lower fluff pulp prices. Adjusted EPS* of $0.60 was only down $0.02 versus the first quarter.
Cash Flow and Capital Allocation
Cash flow provided by operating activities was $25.0 million for the quarter. Capital expenditures, at $23.8 million, remained at a high level as Buckeye continues work on the specialty conversion and oxygen delignification projects at its Foley Mill. We also continued to return cash to shareholders during the quarter, with $9.2 million in share repurchases and $3.4 million in dividends paid out during the quarter. Long-term debt increased by $17.4 million but cash also increased by $10.1 million since September 30. Our free cash flow is forecasted to improve considerably during the next six months as black liquor tax credit paybacks, funding of our employee 401K plans, bonus payouts, and Foley property tax payments are all behind us for the fiscal year, and we expect to realize a little over $20 million in proceeds from the sale of the Delta property in February.
Business Conditions and Outlook
Chairman and Chief Executive Officer John B. Crowe said, “Our second quarter fiscal 2013 earnings came in a bit weaker than expected, with adjusted EPS* below the low end of our earnings call guidance by $0.05. The net positive impact of the final insurance settlement related to the June steam drum failure at our Foley mill, which was received in December, was $0.11, or $0.04 lower than we had anticipated. Otherwise, compared to the high end of our earnings expectations going into this quarter, the main difference was that selling prices on shipments of specialty wood pulp into the viscose staple fiber market were lower than expected, and fluff pulp prices were lower than predicted due to an increase in spot business. We continued to experience weaker market conditions during the quarter in a few specialty fibers markets such as European high performance tire cord, acetate filament, and LCD screens. In order to offset weaker sales into these markets and bring our inventory levels back down, we chose to sell into the viscose staple fiber market for the first time in over two years. We are now experiencing some improvement in the tire cord market with orders up compared to the second quarter. We had good production and shipment volumes in our second quarter. Total shipment volume was up 6% compared to the year ago quarter, driven by increased shipments of specialty wood fibers, fluff pulp, and nonwovens.”
Mr. Crowe went on to say, “During the quarter, we continued to make good progress on our Specialty Expansion and Oxygen Delignification Projects at our Foley facility. Both are important projects which will be key contributors for revenue growth and cost reduction, and are expected to come on-line in April and July 2013 respectively. We currently expect the demand weakness we have been experiencing in several of our markets to continue into the third quarter before starting to improve. As a result, we expect our third quarter adjusted EPS will be about the same as second quarter earnings excluding the insurance benefit, before improving in the fourth quarter. Our long-term prospects remain positive and we are well-positioned to meet the challenges of a sluggish economy and take advantage of opportunities that present themselves.”
Conference Call Details
Buckeye has scheduled a conference call for Wednesday morning, January 30, at 9:00 a.m. ET to discuss second quarter performance. Persons interested in listening by telephone may dial in at (888) 427-9376 within the United States. International callers should dial (719) 325-2215. Supplemental material for the call will be available on the Company’s website at www.bkitech.com or at www.streetevents.com.
Buckeye, a leading manufacturer and marketer of specialty fibers and nonwoven materials, is headquartered in Memphis, Tennessee, USA. The Company currently operates facilities in the United States, Germany, and Canada. Its products are sold worldwide to makers of consumer and industrial goods.
Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws and is intended to qualify for the Safe Harbor from liability established by the Private Securities Litigation Reform Act of 1995. “Forward-looking statements” generally can be identified by the use of forward-looking terminology such as “assumptions,” “target,” “guidance,” “outlook,” “plans,” “projection,” “may,” “will,” “would,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “potential,” or “continue (or the negative or other derivatives of each of these terms or similar terminology). The “forward-looking statements” include, without limitation, statements regarding the economic outlook for Buckeye and the demand for its products, the results and timing of Buckeye’s strategic investments and growth opportunities and expected levels of cash flow and debt reduction. These statements are based on management’s estimates and assumptions with respect to future events and financial performance and are believed to be reasonable, though are inherently uncertain and difficult to predict. Actual results could differ materially from those projected as a result of certain factors. A discussion of factors that could cause results to vary is included in Buckeye’s Annual Report on Form 10-K and other periodic filings with the Securities and Exchange Commission.
Note Regarding Non-GAAP Financial Measures
*This release includes certain financial information not derived in accordance with generally accepted accounting principles (“GAAP”). The non-GAAP measures presented are “adjusted operating income”, “adjusted net income”, “and adjusted earnings per share”, “free cash flow”. The first three measures are equal to net income, pre-tax income, operating income and earnings per share excluding the after-tax effects of alternative fuel mixture credits (AFMC) and cellulosic biofuel credits (CBC), goodwill and long-term asset impairment cost, and restructuring cost. “Free cash flow” is equal to net cash provided by operating activities less net cash used in investing activities (excluding purchase of short term investments.
($ in Millions) |
Q2-2013 |
Q2-2012 |
Q1-2013 |
YTD-2013 |
YTD-2012 |
|||||
Operating income |
||||||||||
Operating income in accordance with GAAP | 25.7 | 39.0 | 38.0 | 63.7 | 82.5 | |||||
Special items: | ||||||||||
Restructuring costs | 7.8 | --- | 1.0 | 8.7 | --- | |||||
Asset and Goodwill impairment |
2.9 |
4.1 |
--- |
2.9 |
4.1 |
|||||
Adjusted operating income (Excludes Americana) |
36.4 | 43.1 | 39.0 | 75.3 | 86.6 | |||||
|
||||||||||
Net income |
Q2-2013 |
Q2-2012 |
Q1-2013 |
YTD-2013 |
YTD-2012 |
|||||
Net income in accordance with GAAP | 12.9 | (5.4) | 29.5 | 42.4 | 35.7 | |||||
Special items, after-tax: | ||||||||||
Restructuring costs | 7.8 | --- | 0.6 | 8.4 | --- | |||||
AFMC / CBC | --- | 3.6 | (5.5) | (5.5) | (7.6) | |||||
Asset and Goodwill impairment |
2.9 |
29.7 |
--- |
2.9 |
29.7 |
|||||
Adjusted net income | 23.6 | 27.9 | 24.6 | 48.2 | 57.8 | |||||
Earnings per share (EPS) - Diluted |
||||||||||
EPS in accordance with GAAP | $0.33 | ($0.14) | $0.74 | $1.07 | $0.88 | |||||
Special items, after-tax, per share: | ||||||||||
Restructuring costs | 0.20 | --- | 0.02 | 0.22 | --- | |||||
AFMC / CBC | --- | 0.09 | (0.14) | (0.14) | (0.19) | |||||
Asset and Goodwill Impairment |
0.07 |
0.74 |
--- |
0.07 |
0.74 |
|||||
Adjusted EPS | $0.60 | $0.69 | $0.62 | 1.22 | 1.43 | |||||
|
||||||||||
($ in Millions) |
Q2-2013 |
Q2-2012 |
Q1-2013 |
YTD-2013 |
YTD-2012 |
|||||
Free Cash Flow |
||||||||||
Net cash provided by operating activities | 25.0 | 24.9 | 3.7 | 28.8 | 53.4 | |||||
Purchases of property, plant & equipment / Other | (23.9) | (13.7) | (28.1) | (52.1) | (24.4) | |||||
Proceeds from insurance settlement related to capital investments |
1.2 |
--- |
3.1 |
4.3 |
--- |
|||||
Free Cash Flow | 2.3 | 11.2 | (21.3) | (19.0) | 29.0 | |||||
Loss from Discontinued Operations
* As a result of the disposition of our Americana operations in Q4 2012 and resulting end to our continuing involvement with the inclusion of the waste water treatment facilities in the assets that were sold, we believe the results of the operations for this business, including the loss recognized from the sale and less applicable income taxes (benefit), should be reported in discontinued operations in our consolidated income statement. The table below shows the detail behind the loss from discontinued operations for each period reported in the press release financial statements.
($ in Millions) |
Q2-2012 |
YTD2012 |
||
Net Sales | 5.7 | 14.3 | ||
COGS |
6.3 |
14.3 |
||
Gross Margin | (0.6) | 0.0 | ||
Asset Impairment Cost | 49.0 | 49.0 | ||
Restructuring Costs |
0.0 |
0.0 |
||
Operating Income | (49.6) | (49.0) | ||
Net Interest Expense (Income) | (0.1) | (0.2) | ||
Foreign Exchange & Other |
(0.3) |
(0.2) |
||
Earnings before Tax | (49.2) | (48.6) | ||
Income tax expense (Benefit) |
(22.8) |
(22.8) |
||
Income (Loss) from Discontinued Operations | (26.4) | (25.8) | ||
BUCKEYE TECHNOLOGIES INC. | ||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
(unaudited) | ||||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
December 31, 2012 | September 30, 2012 | December 31, 2011 | December 31, 2012 | December 31, 2011 | ||||||||||||||||
Net sales | $ | 204,333 | $ | 196,958 | $ | 221,414 | $ | 401,291 | $ | 452,876 | ||||||||||
Cost of goods sold | 157,014 | 146,838 | 166,420 | 303,852 | 341,616 | |||||||||||||||
Gross margin | 47,319 | 50,120 | 54,994 | 97,439 | 111,260 | |||||||||||||||
Gross margin as a percentage of sales | 23.2 | % | 25.4 | % | 24.8 | % | 24.3 | % | 24.6 | % | ||||||||||
Selling, research and administrative expenses | 12,196 | 13,188 | 11,348 | 25,384 | 23,687 | |||||||||||||||
Amortization of intangibles and other | 514 | 508 | 500 | 1,022 | 996 | |||||||||||||||
Asset impairment loss | 2,890 | - | 1,673 | 2,890 | 1,673 | |||||||||||||||
Goodwill impairment loss | - | - | 2,425 | - | 2,425 | |||||||||||||||
Restructuring costs | 7,796 | 963 | - | 8,759 | - | |||||||||||||||
Other operating income | (1,752 | ) | (2,528 | ) | - | (4,280 | ) | - | ||||||||||||
Operating income | 25,675 | 37,989 | 39,048 | 63,664 | 82,479 | |||||||||||||||
Net interest expense and amortization of debt costs | (562 | ) | (641 | ) | (1,021 | ) | (1,203 | ) | (4,470 | ) | ||||||||||
Foreign exchange and other | (58 | ) | (363 | ) | (277 | ) | (421 | ) | 365 | |||||||||||
Income from continuing operations before income taxes | 25,055 | 36,985 | 37,750 | 62,040 | 78,374 | |||||||||||||||
Income tax expense | 12,146 | 7,494 | 16,783 | 19,640 | 16,884 | |||||||||||||||
Income from continuing operations | 12,909 | 29,491 | 20,967 | 42,400 | 61,490 | |||||||||||||||
Loss from discontinued operations, net of tax | - | - | (26,406 | ) | - | (25,822 | ) | |||||||||||||
Net Income (loss) | $ | 12,909 | $ | 29,491 | $ | (5,439 | ) | $ | 42,400 | $ | 35,668 | |||||||||
Computation of diluted earnings per share under the two-class method: | ||||||||||||||||||||
Net income (loss) attributable to shareholders | $ | 12,909 | $ | 29,491 | $ | (5,439 | ) | $ | 42,400 | $ | 35,668 | |||||||||
Less: Distributed and undistributed income allocated to participating securities (nonvested stock) |
(134 | ) | (337 | ) | - | (454 | ) | (520 | ) | |||||||||||
Distributed and undistributed income (loss) available to shareholders |
$ | 12,775 | $ | 29,154 | $ | (5,439 | ) | $ | 41,946 | $ | 35,148 | |||||||||
Diluted weighted average shares outstanding | 39,158 | 39,255 | 39,260 | 39,246 | 39,779 | |||||||||||||||
Income per share from continuing operations | $ | 0.33 | $ | 0.74 | $ | 0.52 | $ | 1.07 | $ | 1.53 | ||||||||||
Loss per share from discontinued operations | - | - | (0.66 | ) | - | (0.65 | ) | |||||||||||||
Diluted earnings (loss) per share | $ | 0.33 | $ | 0.74 | $ | (0.14 | ) | $ | 1.07 | $ | 0.88 | |||||||||
BUCKEYE TECHNOLOGIES INC. | ||||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||||
(In thousands) | ||||||||||||
December 31 | September 30 | June 30 | December 31 | |||||||||
2012 | 2012 | 2012 | 2011 | |||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 49,310 | $ | 39,196 | $ | 38,284 | $ | 35,998 | ||||
Short term investments | 9,236 | 9,051 | 8,813 | - | ||||||||
Accounts receivable, net | 137,927 | 131,212 | 126,705 | 136,571 | ||||||||
Inventories | 105,789 | 114,948 | 90,183 | 106,756 | ||||||||
Deferred income taxes and other | 23,872 | 27,893 | 25,697 | 14,328 | ||||||||
Total current assets | 326,134 | 322,300 | 289,682 | 293,653 | ||||||||
Property, plant and equipment, net | 518,166 | 508,683 | 492,109 | 476,020 | ||||||||
Deferred income taxes | 40,300 | 50,144 | 42,427 | 48,670 | ||||||||
Intellectual property and other, net | 12,055 | 12,572 | 13,193 | 14,138 | ||||||||
Total assets | $ | 896,655 | $ | 893,699 | $ | 837,411 | $ | 832,481 | ||||
Liabilities and stockholders' equity | ||||||||||||
Current liabilities: | ||||||||||||
Trade accounts payable | $ | 23,335 | $ | 30,775 | $ | 40,600 | $ | 32,846 | ||||
Accrued expenses | 38,948 | 38,632 | 43,135 | 40,323 | ||||||||
Other current liabilities | - | - | - | 863 | ||||||||
Total current liabilities | 62,283 | 69,407 | 83,735 | 74,032 | ||||||||
Long-term debt | 99,279 | 81,842 | 58,578 | 86,840 | ||||||||
Deferred income taxes | 4,842 | 16,385 | 4,930 | 5,531 | ||||||||
Other liabilities | 89,454 | 90,497 | 87,132 | 85,486 | ||||||||
Stockholders' equity | 640,797 | 635,568 | 603,036 | 580,592 | ||||||||
Total liabilities and stockholders' equity | $ | 896,655 | $ | 893,699 | $ | 837,411 | $ | 832,481 | ||||
BUCKEYE TECHNOLOGIES INC. | ||||||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||||||||
(unaudited) |
||||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
December 31, 2012 | September 30, 2012 | December 31, 2011 | December 31, 2012 | December 31, 2011 | ||||||||||||||||
OPERATING ACTIVITIES | ||||||||||||||||||||
Net income (loss) | $ | 12,909 | $ | 29,491 | $ | (5,439 | ) | $ | 42,400 | $ | 35,668 | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||||||||||||
Asset impairment loss | 2,890 | - | 50,711 | 2,890 | 50,711 | |||||||||||||||
Depreciation | 11,643 | 12,242 | 12,791 | 23,885 | 25,817 | |||||||||||||||
Amortization | 670 | 663 | 655 | 1,333 | 1,306 | |||||||||||||||
Loss on goodwill impairment | - | - | 2,425 | - | 2,425 | |||||||||||||||
Deferred income taxes | 2,266 | 1,608 | (2,509 | ) | 3,874 | (16,141 | ) | |||||||||||||
Noncurrent AFMC refund payable | - | 3,288 | (1,567 | ) | 3,288 | 13,895 | ||||||||||||||
Loss on disposal of equipment | 552 | 529 | 483 | 1,081 | 766 | |||||||||||||||
Insurance settlement | (1,749 | ) | (2,528 | ) | - | (4,277 | ) | - | ||||||||||||
Provision for bad debts | (144 | ) | 104 | 49 | (40 | ) | 604 | |||||||||||||
Excess tax benefit from stock based compensation | (1,162 | ) | (1,048 | ) | (788 | ) | (2,210 | ) | (1,553 | ) | ||||||||||
Stock-based compensation expense | 1,330 | 1,340 | 1,245 | 2,670 | 2,211 | |||||||||||||||
Other | (17 | ) | 20 | (244 | ) | 3 | (356 | ) | ||||||||||||
Change in operating assets and liabilities | ||||||||||||||||||||
Accounts receivable | (9,498 | ) | 16,121 | 1,999 | 6,623 | 537 | ||||||||||||||
Income tax receivable | 3,672 | (20,525 | ) | - | (16,853 | ) | - | |||||||||||||
Inventories | 9,194 | (24,043 | ) | (6,346 | ) | (14,849 | ) | (18,793 | ) | |||||||||||
Other assets | 744 | (131 | ) | (3,247 | ) | 613 | (2,888 | ) | ||||||||||||
Accounts payable and other liabilities | (8,281 | ) | (13,395 | ) | (25,288 | ) | (21,676 | ) | (40,815 | ) | ||||||||||
Net cash provided by operating activities | 25,019 | 3,736 | 24,930 | 28,755 | 53,394 | |||||||||||||||
INVESTING ACTIVITIES | ||||||||||||||||||||
Purchases of property, plant & equipment | (23,848 | ) | (28,103 | ) | (13,586 | ) | (51,951 | ) | (24,299 | ) | ||||||||||
Proceeds from insurance settlement related to capital investments |
1,206 | 3,071 | - | 4,277 | - | |||||||||||||||
Other | (110 | ) | (17 | ) | (75 | ) | (127 | ) | (126 | ) | ||||||||||
Net cash used in investing activities | (22,752 | ) | (25,049 | ) | (13,661 | ) | (47,801 | ) | (24,425 | ) | ||||||||||
FINANCING ACTIVITIES | ||||||||||||||||||||
Net borrowings (payments) under line of credit | 17,437 | 23,264 | (3,511 | ) | 40,701 | (10,081 | ) | |||||||||||||
Excess tax benefit from stock based compensation | 1,162 | 1,048 | 788 | 2,210 | 1,553 | |||||||||||||||
Purchase of treasury shares | (9,175 | ) | (28 | ) | (1,941 | ) | (9,203 | ) | (10,589 | ) | ||||||||||
Net proceeds from sale of equity interests | 1,210 | 874 | 1,002 | 2,084 | 1,640 | |||||||||||||||
Payment of dividend | (3,445 | ) | (3,148 | ) | (2,374 | ) | (6,593 | ) | (4,784 | ) | ||||||||||
Other | (74 | ) | (864 | ) | - | (938 | ) | (469 | ) | |||||||||||
Net cash provided by (used in) financing activities | 7,115 | 21,146 | (6,036 | ) | 28,261 | (22,730 | ) | |||||||||||||
Effect of foreign currency rate fluctuations on cash | 732 | 1,079 | (2,029 | ) | 1,811 | (735 | ) | |||||||||||||
Increase in cash and cash equivalents | 10,114 | 912 | 3,204 | 11,026 | 5,504 | |||||||||||||||
Cash and cash equivalents at beginning of period | 39,196 | 38,284 | 32,794 | 38,284 | 30,494 | |||||||||||||||
Cash and cash equivalents at end of period | $ | 49,310 | $ | 39,196 | $ | 35,998 | $ | 49,310 | $ | 35,998 | ||||||||||
BUCKEYE TECHNOLOGIES INC. | ||||||||||||||||||||
SUPPLEMENTAL FINANCIAL DATA | ||||||||||||||||||||
(unaudited) |
||||||||||||||||||||
(In thousands) | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
SEGMENT RESULTS | December 31, 2012 | September 30, 2012 | December 31, 2011 | December 31, 2012 | December 31, 2011 | |||||||||||||||
Specialty Fibers | ||||||||||||||||||||
Net sales | $ | 153,399 | $ | 143,311 | $ | 170,977 | $ | 296,710 | $ | 345,794 | ||||||||||
Operating income (a) | 35,072 | 37,072 | 42,506 | 72,144 | 85,751 | |||||||||||||||
Depreciation and amortization (b) | 7,651 | 7,709 | 7,815 | 15,360 | 15,509 | |||||||||||||||
Total assets | 533,016 | 505,281 | 482,236 | 533,016 | 482,236 | |||||||||||||||
Capital expenditures | 21,608 | 25,264 | 11,510 | 46,872 | 20,495 | |||||||||||||||
Nonwoven Materials | ||||||||||||||||||||
Net sales | $ | 54,190 | $ | 58,374 | $ | 58,307 | $ | 112,564 | $ | 122,992 | ||||||||||
Operating income (a) | 3,719 | 5,522 | 2,765 | 9,241 | 5,093 | |||||||||||||||
Depreciation and amortization (b) | 3,563 | 4,087 | 4,009 | 7,650 | 8,226 | |||||||||||||||
Total assets | 173,260 | 188,297 | 193,950 | 173,260 | 193,950 | |||||||||||||||
Capital expenditures | 1,665 | 1,885 | 1,674 | 3,550 | 3,363 | |||||||||||||||
Corporate | ||||||||||||||||||||
Net sales | $ | (3,256 | ) | $ | (4,727 | ) | $ | (7,870 | ) | $ | (7,983 | ) | $ | (15,910 | ) | |||||
Operating loss (a) | (13,116 | ) | (4,605 | ) | (6,223 | ) | (17,721 | ) | (8,365 | ) | ||||||||||
Depreciation and amortization (b) | 943 | 954 | 957 | 1,897 | 1,903 | |||||||||||||||
Total assets | 190,379 | 200,121 | 156,295 | 190,379 | 156,295 | |||||||||||||||
Capital expenditures | 575 | 954 | 402 | 1,529 | 441 | |||||||||||||||
Total | ||||||||||||||||||||
Net sales | $ | 204,333 | $ | 196,958 | $ | 221,414 | $ | 401,291 | $ | 452,876 | ||||||||||
Operating income (a) | 25,675 | 37,989 | 39,048 | 63,664 | 82,479 | |||||||||||||||
Depreciation and amortization (b) | 12,157 | 12,750 | 12,781 | 24,907 | 25,638 | |||||||||||||||
Total assets | 896,655 | 893,699 | 832,481 | 896,655 | 832,481 | |||||||||||||||
Capital expenditures | 23,848 | 28,103 | 13,586 | 51,951 | 24,299 | |||||||||||||||
(a) The corporate segment includes operating elements such as segment eliminations, amortization of intangibles, impairment of long-lived assets, goodwill impairment, alternative fuel mixture credits, charges related to restructuring, unallocated at-risk compensation and unallocated stock-based compensation for executive officers and certain other employees. Corporate net sales represents the elimination of intersegment sales included in the specialty fibers reporting segment. | ||||||||||||||||||||
(b) Depreciation and amortization includes depreciation, depletion and amortization of intangibles. | ||||||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||||||
ADJUSTED EBITDA | December 31, 2012 | September 30, 2012 | December 31, 2011 | December 31, 2012 | December 31, 2011 | |||||||||||||||
Net income (loss) | $ | 12,909 | $ | 29,491 | $ | (5,439 | ) | $ | 42,400 | $ | 35,668 | |||||||||
Elimination of discontinued operations | - | - | 26,406 | - | 25,822 | |||||||||||||||
Income tax expense | 12,146 | 7,494 | 16,783 | 19,640 | 16,884 | |||||||||||||||
Interest expense | 450 | 535 | 868 | 985 | 4,216 | |||||||||||||||
Amortization of debt costs | 156 | 155 | 155 | 311 | 310 | |||||||||||||||
Depreciation, depletion and amortization | 12,157 | 12,750 | 12,781 | 24,907 | 25,638 | |||||||||||||||
EBITDA | 37,818 | 50,425 | 51,554 | 88,243 | 108,538 | |||||||||||||||
Asset impairments | 2,890 | - | 4,098 | 2,890 | 4,098 | |||||||||||||||
Restructuring | 7,796 | 963 | - | 8,759 | - | |||||||||||||||
Non cash charges | 566 | 531 | 481 | 1,097 | 781 | |||||||||||||||
Adjusted EBITDA | $ | 49,070 | $ | 51,919 | $ | 56,133 | $ | 100,989 | $ | 113,417 | ||||||||||
We calculate EBITDA as earnings before cumulative effect of change in accounting plus interest expense, income taxes and depreciation and amortization. Adjusted EBITDA further adjusts EBITDA by adding back the following items: asset impairment charges, goodwill impairment, restructuring charges incurred since the inception of the current credit facility, non-cash charges and other (gains) losses and deducting any non-cash expense associated with alternative fuel mixture credits. You should not consider adjusted EBITDA to be an alternative measure of our net income, as an indicator of operating performance; or our cash flow, as an indicator of liquidity. Adjusted EBITDA corresponds with the definition contained in our US revolving credit facility, established on October 22, 2010, and it provides useful information concerning our ability to comply with debt covenants. Although we believe adjusted EBITDA enhances your understanding of our financial condition, this measure, when viewed individually, is not a better indicator of any trend as compared to other measures (e.g., net sales, net earnings, net cash flows, etc.). Prior period amounts have been adjusted to conform to the definition contained in our new credit facility. | ||||||||||||||||||||
CONTACT:
Buckeye Technologies Inc.
Steve Dean, 901-320-8352
Executive
Vice President and Chief Financial Officer
or
Eric Whaley,
901-320-8509
Director Investor Relations
www.bkitech.com