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| 8-K - 8-K - Blue Bird Corp | a20164qcoverpage.htm |
BLUE BIRD DELIVERS STRONG FISCAL 2016 FINANCIAL PERFORMANCE
Full-Year Net Sales and Adjusted EBITDA up, in line with Guidance;
Propane-Powered Bus Unit Sales up 33%;
Fourth Quarter Results Slightly Lower Compared with Prior Year
Fort Valley, GA, December 13, 2016 – Blue Bird Corporation (“Blue Bird”) (Nasdaq: BLBD), the leading independent designer and manufacturer of school buses, announced today its fiscal 2016 fourth quarter and full-year results.
Highlights
• | Achieved guidance for full-year net sales, Adjusted EBITDA and Adjusted Free Cash Flow |
• | Generated net sales of $932.0 million, $12.9 million higher than last year. Net sales of $286.4 million for the fourth quarter |
• | Overall unit sales for the year were up 2% to 10,616, with propane-powered bus sales up 33% to 2,240 units. Unit sales for the fourth quarter totaled 3,308, with propane unit sales of 693 |
• | Full-year Adjusted EBITDA of $72.2 million, up $2.3 million compared with last year. Fourth quarter Adjusted EBITDA of $24.3 million |
• | Generated strong Adjusted Free Cash Flow for the year of $33.3 million. Adjusted Free Cash Flow in the fourth quarter of $2.6 million |
• | Voluntarily prepaid $25 million of debt for the second consecutive year as a result of strong cash position |
• | On December 12, 2016, the Company successfully refinanced its $160 million term loan and $75 million revolving line of credit. The new credit facility, led by Bank of Montreal as Administrative Agent and an Issuing Bank, reduces the Company’s effective interest rate paid by approximately 4 pts. |
• | Full-year gross margins up 80 basis points to 13.9%. Fourth quarter gross margins of 13.5% |
• | Full-year income from continuing operations of $7.2 million, down $7.8 million compared with the same period last year. Fourth quarter income from continuing operations of $11.1 million. Income from continuing operations was impacted by non-recurring items associated with the change of control |
• | Well positioned for continued growth in fiscal 2017 with net sales guidance of $980 million -1.0 billion, Adjusted EBITDA guidance of $72-76 million and Adjusted Free Cash Flow guidance of $38-42 million |
Three Months Ended October 1, 2016 | B/(W) 2015 | Fiscal Year Ended October 1, 2016 | B/(W) 2015 | ||||||||||||
Unit Sales | 3,308 | (160 | ) | 10,616 | 238 | ||||||||||
GAAP Measures: | |||||||||||||||
Revenue (Mils.) | $ | 286.4 | $ | (21.2 | ) | $ | 932.0 | $ | 12.9 | ||||||
Income from Continuing Operations (Mils.) | $ | 11.1 | $ | (5.0 | ) | $ | 7.2 | $ | (7.8 | ) | |||||
Diluted Earnings per Share from Continuing Operations | $ | 0.40 | $ | (0.23 | ) | $ | 0.16 | $ | (0.43 | ) | |||||
Non-GAAP Measures: | |||||||||||||||
Adjusted EBITDA1 (Mils.) | $ | 24.3 | $ | (4.7 | ) | $ | 72.2 | $ | 2.3 | ||||||
Adjusted Income from Continuing Operations1 (Mils.) | $ | 13.4 | $ | (3.8 | ) | $ | 30.1 | $ | 0.3 | ||||||
Adjusted Diluted Earnings per Share1 | $ | 0.49 | $ | (0.19 | ) | $ | 1.17 | $ | — | ||||||
1
1 See attachments for Adjusted EBITDA, Adjusted Net Income, Adjusted Diluted EPS and Adjusted Free Cash Flow reconciliations
“Overall, we had a great year at Blue Bird. We successfully launched four, all-new powertrains while delivering solid growth in top-line revenue and Adjusted EBITDA,” said Phil Horlock, President and Chief Executive Officer of Blue Bird Corporation. “Our propane-powered bus offering continues to be the undisputed leader in alternative fuels with sales up 33% over the prior year. We shipped 406 new gasoline-powered Vision school buses in September, following an unexpected delay in CARB certification for the product. Overcoming this obstacle was a testament to our strong relationship with The Ford Motor Company and Roush CleanTech. With the broadest product range and engine choice in the industry, we are well-positioned for growth next year. Consequently, we are forecasting continued growth in fiscal 2017 with full year net revenue guidance of $980 million -1.0 billion, Adjusted EBITDA of $72-76 million and Adjusted Free Cash Flow of $38-42 million.”
Full-Year 2016 Results
Net Sales
Total net sales were $932.0 million for the fiscal year ended October 1, 2016, an increase of $12.9 million, or 1.4%, compared with the prior year. This was primarily driven by an increase in bus unit sales, which were 238 units higher than last year for the same period.
Gross Profit
Full-year gross profit was $129.4 million, an increase of $9.0 million from the prior year.
Adjusted EBITDA
Adjusted EBITDA was $72.2 million, or 7.7% of net sales, for the fiscal year ended October 1, 2016, an increase of $2.3 million, or 3.3%, compared with $69.9 million, or 7.6% of net sales, for the prior year. The increase in adjusted EBITDA is primarily the result of higher gross profit, partially offset by increased selling, general and administrative expenses (excluding one-time expenses associated with the business combination and special compensation payments).
Income from Continuing Operations
Income from continuing operations was $7.2 million for the fiscal year ended October 1, 2016, a decrease of $7.8 million compared with the prior year. This primarily reflects a decrease in operating profit of $9.2 million.
Adjusted Income from Continuing Operations was $30.1 million, representing an increase of $0.3 million compared with the prior year.
Fourth Quarter 2016 Results
Net Sales
Total net sales were $286.4 million for the fourth quarter of fiscal 2016, a decrease of $21.2 million, or 6.9%, from prior year period. Bus unit sales were 3,308 units for the quarter compared with 3,468 units for the same period last year.
Gross Profit
Fourth quarter gross profit of $38.7 million represents a decrease of $2.5 million over the fourth quarter of last year.
Adjusted EBITDA
Adjusted EBITDA was $24.3 million, or 8.5% of net sales, for the fourth quarter of fiscal 2016, a decrease of $4.7 million, or 16.2%, compared with $29.0 million, or 9.4% of net sales, for the fourth quarter of the prior year. The decrease in adjusted EBITDA is primarily the result of lower volume.
Income from Continuing Operations
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Income from continuing operations was $11.1 million for the fourth quarter of fiscal 2016, a decrease of $5.0 million compared with the same period last year. The decrease primarily reflects lower operating profit of $6.2 million.
Adjusted Income from Continuing Operations was $13.4 million, representing a decrease of $3.8 million compared with the same period last year.
Conference Call Details
Blue Bird will discuss its fourth quarter and full-year 2016 results and other related matters in a conference call at 8:00 AM ET today. Participants may listen to the audio portion of the conference call either through a live audio webcast on the Company's website or by telephone. The slide presentation and webcast can be accessed via the Investor Relations portion of Blue Bird's website at www.blue-bird.com.
• | Webcast participants should log on and register at least ten minutes prior to the start time on the Investor Relations homepage of Blue Bird’s website at http://investors.blue-bird.com. Click the link in the events box on the Investor Relations landing page. |
• | Participants desiring audio only should dial 877-407-4018 or 201-689-8471. |
A replay of the webcast will be available approximately two hours after the call concludes via the same link on Blue Bird’s website.
About Blue Bird Corporation
Blue Bird is the leading independent designer and manufacturer of school buses, with more than 550,000 buses sold since its formation in 1927 and approximately 180,000 buses in operation today. Blue Bird’s longevity and reputation in the school bus industry have made it an iconic American brand. Blue Bird distinguishes itself from its principal competitors by its singular focus on the design, engineering, manufacture and sale of school buses and related parts. As the only manufacturer of chassis and body production specifically designed for school bus applications, Blue Bird is recognized as an industry leader for school bus innovation, safety, product quality/reliability/durability, operating costs and drivability. In addition, Blue Bird is the market leader in alternative fuel applications with its propane-powered and compressed natural gas-powered school buses. Blue Bird manufactures school buses at two facilities in Fort Valley, Georgia. Its Micro Bird joint venture operates a manufacturing facility in Drummondville, Quebec, Canada. Service and after-market parts are distributed from Blue Bird’s parts distribution center located in Delaware, Ohio.
Non-GAAP Financial Measures
This press release may include the following non-GAAP financial measures: “Adjusted EBITDA,” "Adjusted Income from Continuing Operations," "Adjusted Diluted Earnings per Share," “Free Cash Flow” and “Adjusted Free Cash Flow.” Adjusted EBITDA is defined as income from continuing operations prior to interest income, interest expense, income taxes, and depreciation, amortization, and disposals, as adjusted to add back certain charges that we may record each year, such as stock-compensation expense and transaction costs, as these expenses are not considered an indicator of ongoing company performance. Adjusted net income is defined as net income, as adjusted to add back certain transaction costs not considered an indicator of ongoing company performance. Adjusted diluted earnings per share represents adjusted income (loss) from continuing operations divided by diluted weighted average common shares outstanding (as if we had GAAP net income during the respective period). Adjusted net income from continuing operations and adjusted diluted earnings per share are calculated net of taxes. Free cash flow represents net cash provided by continuing operations minus cash paid for fixed assets. Adjusted Free Cash flow represents free cash flow excluding cash paid for special compensation and other business combination expenses.
There are limitations to using non-GAAP measures. Although Blue Bird believes that such measures may enhance an evaluation of Blue Bird’s operating performance and cash flows, (i) other companies in Blue Bird’s industry may define such measures differently than Blue Bird does and, as a result, they may not be comparable to similarly titled measures used by other companies in Blue Bird’s industry and (ii) such measures may exclude certain financial information that some may consider important in evaluating Blue Bird’s performance and cash flows.
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Forward Looking Statements
This press release includes forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations for future financial performance, business strategies or expectations for our business. Specifically, forward-looking statements include statements in this press release regarding guidance, seasonality, product mix and gross profits and may include statements relating to:
• | Inherent limitations of internal controls impacting financial statements |
• | Growth opportunities |
• | Future profitability |
• | Ability to expand market share |
• | Customer demand for certain products |
• | Economic conditions that could affect fuel costs, commodity costs, industry size and financial conditions of our dealers and suppliers |
• | Labor or other constraints on the Company’s ability to maintain a competitive cost structure |
• | Volatility in the tax base and other funding sources that support the purchase of buses by our end customers |
• | Lower or higher than anticipated market acceptance for our products |
• | Other statements preceded by, followed by or that include the words “estimate,” “plan,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “seek,” “target” or similar expressions |
These forward-looking statements are based on information available as of the date of this press release, and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. The factors described above, as well as risk factors described in reports filed with the SEC by us (available at www.sec.gov), could cause our actual results to differ materially from estimates or expectations reflected in such forward-looking statements.
Contact:
Mark Benfield
Investor Relations & New Business Development
(478) 822-2315
Mark.Benfield@blue-bird.com
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BLUE BIRD CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands except for share data) | October 1, 2016 | October 3, 2015 | |||||
(unaudited) | (unaudited) | ||||||
Assets | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 52,309 | $ | 52,861 | |||
Accounts receivable, net | 20,315 | 13,746 | |||||
Inventories | 53,806 | 49,180 | |||||
Other current assets | 6,104 | 3,960 | |||||
Deferred tax asset | 7,612 | 9,150 | |||||
Total current assets | $ | 140,146 | $ | 128,897 | |||
Property, plant and equipment, net | 33,466 | 28,933 | |||||
Goodwill | 18,825 | 18,825 | |||||
Intangible assets, net | 59,491 | 60,378 | |||||
Equity investment in affiliate | 12,944 | 12,505 | |||||
Deferred tax asset | 11,468 | 15,466 | |||||
Other assets | 1,526 | 1,721 | |||||
Total assets | $ | 277,866 | $ | 266,725 | |||
Liabilities and Stockholder’s Deficit | |||||||
Current liabilities | |||||||
Accounts payable | $ | 80,646 | $ | 79,333 | |||
Warranty | 7,972 | 7,418 | |||||
Accrued expenses | 20,455 | 22,980 | |||||
Deferred warranty income | 5,666 | 4,862 | |||||
Other current liabilities | 4,032 | 7,072 | |||||
Current portion of senior term debt | 11,750 | 11,750 | |||||
Total current liabilities | $ | 130,521 | $ | 133,415 | |||
Long-term liabilities | |||||||
Long-term debt | $ | 140,366 | $ | 175,418 | |||
Warranty | 11,472 | 10,243 | |||||
Deferred warranty income | 10,521 | 9,283 | |||||
Other liabilities | 15,592 | 13,169 | |||||
Pension | 56,368 | 46,427 | |||||
Total long-term liabilities | $ | 234,319 | $ | 254,540 | |||
Stockholder’s deficit | |||||||
Preferred stock, $0.0001 par value, 10,000,000 shares authorized, 500,000 issued and liquidation preference of $50,000 | $ | 50,000 | $ | 50,000 | |||
Common stock, $0.0001 par value, 100,000,000 shares authorized, 22,518,058 and 20,874,882 issued and outstanding at October 1, 2016 and October 3, 2015, respectively. | 2 | 2 | |||||
Additional paid-in capital | 50,771 | 15,887 | |||||
Accumulated deficit | (128,856 | ) | (135,345 | ) | |||
Accumulated other comprehensive loss | (58,891 | ) | (51,774 | ) | |||
Total stockholder’s deficit | $ | (86,974 | ) | $ | (121,230 | ) | |
Total liabilities and stockholder’s deficit | $ | 277,866 | $ | 266,725 | |||
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BLUE BIRD CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
Three Months Ended | Fiscal Year Ended | ||||||||||||||
(in thousands except for share data) | October 1, 2016 | October 3, 2015 | October 1, 2016 | October 3, 2015 | |||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||
Net sales | $ | 286,414 | $ | 307,624 | $ | 932,010 | $ | 919,128 | |||||||
Cost of goods sold | 247,733 | 266,399 | 802,654 | 798,733 | |||||||||||
Gross profit | $ | 38,681 | $ | 41,225 | $ | 129,356 | $ | 120,395 | |||||||
Operating expenses | |||||||||||||||
Selling, general and administrative expenses | 21,382 | 17,748 | 102,711 | 84,561 | |||||||||||
Operating profit | $ | 17,299 | $ | 23,477 | $ | 26,645 | $ | 35,834 | |||||||
Interest expense | (3,676 | ) | (4,605 | ) | (16,412 | ) | (19,078 | ) | |||||||
Interest income | 15 | 74 | 133 | 113 | |||||||||||
Other expense, net | (42 | ) | — | (26 | ) | — | |||||||||
Income before income taxes | $ | 13,596 | $ | 18,946 | $ | 10,340 | $ | 16,869 | |||||||
Income tax expense | (3,920 | ) | (4,434 | ) | (5,989 | ) | (4,442 | ) | |||||||
Equity in net income of non-consolidated affiliate | 1,383 | 1,585 | 2,877 | 2,634 | |||||||||||
Net income from continuing operations | $ | 11,059 | $ | 16,097 | $ | 7,228 | $ | 15,061 | |||||||
Loss from discontinued operations, net of tax | (282 | ) | (125 | ) | (328 | ) | (129 | ) | |||||||
Net income | $ | 10,777 | $ | 15,972 | $ | 6,900 | $ | 14,932 | |||||||
Defined benefit pension plan loss, net of tax benefit of $5,082, $4,004, $3,825 and $959, respectively | (9,437 | ) | (6,986 | ) | (7,104 | ) | (5,206 | ) | |||||||
Cash flow hedge gain (loss), net of tax (expense) benefit of $(142), $0, $7 and $0, respectively | 263 | — | (13 | ) | — | ||||||||||
Comprehensive income (loss) | $ | 1,603 | $ | 8,986 | $ | (217 | ) | $ | 9,726 | ||||||
Net income (from above) | $ | 10,777 | $ | 15,972 | $ | 6,900 | $ | 14,932 | |||||||
Less: preferred stock dividends | 963 | 998 | 3,878 | 2,438 | |||||||||||
Net income available to common stockholders | $ | 9,814 | $ | 14,974 | $ | 3,022 | $ | 12,494 | |||||||
Earnings per share: | |||||||||||||||
Basic weighted average shares outstanding | 22,041,111 | 20,789,435 | 21,252,616 | 21,182,885 | |||||||||||
Diluted weighted average shares outstanding | 27,581,678 | 25,437,869 | 21,315,619 | 25,497,602 | |||||||||||
Basic earnings per share, continuing operations | $ | 0.46 | $ | 0.73 | $ | 0.16 | $ | 0.60 | |||||||
Basic earnings per share, discontinued operations | (0.01 | ) | (0.01 | ) | (0.02 | ) | (0.01 | ) | |||||||
Basic earnings per share | $ | 0.45 | $ | 0.72 | $ | 0.14 | $ | 0.59 | |||||||
Diluted earnings per share, continuing operations | $ | 0.40 | $ | 0.63 | $ | 0.16 | $ | 0.59 | |||||||
Diluted earnings per share, discontinued operations | (0.01 | ) | — | (0.02 | ) | — | |||||||||
Diluted earnings per share | $ | 0.39 | $ | 0.63 | $ | 0.14 | $ | 0.59 | |||||||
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BLUE BIRD CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Fiscal Year Ended | |||||||
(in thousands of dollars) | October 1, 2016 | October 3, 2015 | |||||
(unaudited) | (unaudited) | ||||||
Cash flows from operating activities | |||||||
Net income | $ | 6,900 | $ | 14,932 | |||
Loss from discontinued operations, net of tax | 328 | 129 | |||||
Adjustments to reconcile net income to net cash provided by continuing operations | |||||||
Depreciation and amortization | 8,046 | 8,790 | |||||
Amortization of debt costs | 3,007 | 3,010 | |||||
Share-based compensation | 12,717 | 1,635 | |||||
Equity in net income of affiliate | (2,877 | ) | (2,634 | ) | |||
Loss on disposal of fixed assets | 72 | 510 | |||||
Deferred taxes | 8,957 | (8,626 | ) | ||||
Provision for bad debt | (5 | ) | 34 | ||||
Amortization of deferred actuarial pension losses | 4,787 | 3,567 | |||||
Changes in assets and liabilities: | |||||||
Accounts receivable | (6,564 | ) | 7,435 | ||||
Inventories | (4,626 | ) | 22,120 | ||||
Other assets | (2,457 | ) | (137 | ) | |||
Accounts payable | (830 | ) | (12,905 | ) | |||
Accrued expenses, pension and other liabilities | (4,474 | ) | (14,365 | ) | |||
Dividend from equity investment in affiliate | 2,316 | — | |||||
Total adjustments | $ | 18,069 | $ | 8,434 | |||
Net cash provided by continuing operations | $ | 25,297 | $ | 23,495 | |||
Net cash used in discontinued operations | (192 | ) | (129 | ) | |||
Total cash provided by operating activities | $ | 25,105 | $ | 23,366 | |||
Cash flows from investing activities | |||||||
Cash paid for fixed assets and acquired intangible assets | (9,583 | ) | (5,190 | ) | |||
Total cash used in investing activities | $ | (9,583 | ) | $ | (5,190 | ) | |
Cash flows from financing activities | |||||||
Repayments under the senior term loan | (36,750 | ) | (36,750 | ) | |||
Cash paid for capital leases | (221 | ) | (142 | ) | |||
Cash paid for debt costs | (1,117 | ) | (3,110 | ) | |||
Contributions from former majority stockholder | 16,971 | 13,550 | |||||
Payment of dividends on preferred stock | (2,881 | ) | — | ||||
Cash paid for employee taxes on vested restricted shares and stock options | (3,892 | ) | — | ||||
Proceeds from exercises of warrants | 11,816 | — | |||||
Total cash used in financing activities | $ | (16,074 | ) | $ | (26,452 | ) | |
Change in cash and cash equivalents | (552 | ) | (8,276 | ) | |||
Cash and cash equivalents, beginning of year | 52,861 | 61,137 | |||||
Cash and cash equivalents, end of year | $ | 52,309 | $ | 52,861 | |||
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Fiscal Year Ended | |||||||
(in thousands of dollars) | October 1, 2016 | October 3, 2015 | |||||
(unaudited) | (unaudited) | ||||||
Supplemental disclosures of cash flow information | |||||||
Cash Paid During the Period for: | |||||||
Interest paid, net of interest received | $ | 13,315 | $ | 20,011 | |||
Income tax paid, net of tax refunds | 159 | 7,145 | |||||
Non-cash investing and financing activity | |||||||
Capital lease acquisitions | $ | 100 | $ | 563 | |||
Change in accounts payable and other assets for capital additions to property, plant and equipment and intangible assets | 2,081 | 671 | |||||
Common stock dividend on Series A preferred stock (market value of common shares) | 998 | 2,247 | |||||
Cashless exercise of stock options | 2,312 | — | |||||
Non-cash reverse merger activity | |||||||
Issuance of Common Stock | $ | — | $ | 25,000 | |||
Issuance of Series A Preferred Stock | — | 50,000 | |||||
Shares assumed by legal acquirer | — | 42,492 | |||||
Repurchase of Common Stock from Traxis | — | 100,000 | |||||
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Reconciliation of GAAP Net Income to Adjusted EBITDA
(Unaudited)
Three Months Ended | Fiscal Year Ended | ||||||||||||||
(in thousands of dollars) | October 1, 2016 | October 3, 2015 | October 1, 2016 | October 3, 2015 | |||||||||||
Net income | $ | 10,777 | $ | 15,972 | $ | 6,900 | $ | 14,932 | |||||||
Loss from discontinued operations, net of tax | (282 | ) | (125 | ) | (328 | ) | (129 | ) | |||||||
Income from continuing operations | $ | 11,059 | $ | 16,097 | $ | 7,228 | $ | 15,061 | |||||||
Interest expense | 3,676 | 4,605 | 16,412 | 19,078 | |||||||||||
Interest income | (15 | ) | (74 | ) | (133 | ) | (113 | ) | |||||||
Income tax expense | 3,920 | 4,434 | 5,989 | 4,442 | |||||||||||
Depreciation, amortization, and disposals | 2,064 | 2,159 | 8,118 | 9,300 | |||||||||||
Special compensation payment (1) | 16 | — | 17,128 | 13,788 | |||||||||||
Public company expenses, non-recurring | — | 494 | — | 3,148 | |||||||||||
Business combination expenses | 3,559 | 162 | 3,798 | 3,526 | |||||||||||
One-time post-retirement benefit adjustment | — | — | 896 | — | |||||||||||
Share-based compensation | — | 1,109 | 12,717 | 1,635 | |||||||||||
Adjusted EBITDA | $ | 24,279 | $ | 28,986 | $ | 72,153 | $ | 69,865 | |||||||
Adjusted EBITDA margin (percentage of net sales) | 8.5 | % | 9.4 | % | 7.7 | % | 7.6 | % | |||||||
(1) The special compensation payments for fiscal 2016 and 2015 were primarily funded by contributions from our former majority stockholder concurrent with the June 2016 change in control and the 2015 Business Combination, respectively. With the 2016 payment and change in majority ownership, this incentive program has concluded.
Reconciliation of Free Cash Flow and Adjusted Free Cash Flow
(Unaudited)
Three Months Ended | Fiscal Year Ended | ||||||||||||||
(in thousands of dollars) | October 1, 2016 | October 3, 2015 | October 1, 2016 | October 3, 2015 | |||||||||||
Net cash provided by continuing operations | $ | 3,990 | $ | 55,128 | $ | 25,297 | $ | 23,495 | |||||||
Cash paid for fixed assets and acquired intangible assets | (3,072 | ) | (1,763 | ) | (9,583 | ) | (5,190 | ) | |||||||
Free cash flow | $ | 918 | $ | 53,365 | $ | 15,714 | $ | 18,305 | |||||||
Cash paid for special compensation payment | (1,371 | ) | — | (17,128 | ) | (13,788 | ) | ||||||||
Cash paid for business combination expenses | (261 | ) | — | (500 | ) | (12,500 | ) | ||||||||
Adjusted free cash flow | 2,550 | 53,365 | 33,342 | 44,593 | |||||||||||
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Reconciliation of Net Income to Adjusted Income from Continuing Operations
(Unaudited)
Three Months Ended | Fiscal Year Ended | ||||||||||||||
(in thousands) | October 1, 2016 | October 3, 2015 | October 1, 2016 | October 3, 2015 | |||||||||||
Net income, GAAP | $ | 10,777 | $ | 15,972 | $ | 6,900 | $ | 14,932 | |||||||
Add: loss from discontinued operations, net of tax, GAAP | 282 | 125 | 328 | 129 | |||||||||||
Income from continuing operations, GAAP | 11,059 | 16,097 | 7,228 | 15,061 | |||||||||||
One-time charge adjustments, net of tax benefit (1) | |||||||||||||||
Special compensation payment | 10 | — | 11,133 | 8,962 | |||||||||||
Public company expenses, non-recurring | — | 321 | — | 2,046 | |||||||||||
Business combination expenses | 2,313 | 105 | 2,469 | 2,292 | |||||||||||
Loss on disposal of fixed assets | 28 | 10 | 47 | 332 | |||||||||||
One-time post-retirement benefit adjustment | — | — | 582 | — | |||||||||||
Share-based compensation (2) | — | 721 | 8,619 | 1,063 | |||||||||||
Adjusted income from continuing operations, non-GAAP | 13,410 | 17,254 | 30,078 | 29,756 | |||||||||||
(1) Amounts are net of federal statutory tax rate of 35%.
(2) Also includes tax shortfall expense.
Reconciliation of GAAP Diluted EPS to Non-GAAP Diluted EPS
(Unaudited)
Three Months Ended | Fiscal Year Ended | ||||||||||||||
(in thousands) | October 1, 2016 | October 3, 2015 | October 1, 2016 | October 3, 2015 | |||||||||||
Diluted earnings per share, continuing operations, GAAP | $ | 0.40 | $ | 0.63 | $ | 0.16 | $ | 0.59 | |||||||
One-time charge adjustments, net of tax benefit and inclusion of dilutive securities | 0.09 | 0.05 | 1.01 | 0.58 | |||||||||||
Adjusted diluted earnings per share from continuing operations, non-GAAP (1) | $ | 0.49 | $ | 0.68 | $ | 1.17 | $ | 1.17 | |||||||
Weighted average dilutive shares outstanding, non-GAAP (2) | 27,581,678 | 25,437,869 | 25,629,683 | 25,497,602 | |||||||||||
(1) Numerator is adjusted income from continuing operations, non-GAAP.
(2) With adjusted income from continuing operations for the fiscal year ended 2016, 4,314,064 shares of convertible preferred stock were included in the weighted average dilutive shares outstanding, non-GAAP. The shares were excluded from the GAAP diluted earnings per share calculation since the if-converted impact would be anti-dilutive and, as a result, the numerator used in the GAAP calculation included the preferred stock dividend impact on income.
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