Item 2.02 Results of Operations and Financial Condition.
On
Non-GAAP Financial Measures in the Earnings Release
The Earnings Release includes, as additional information for investors, the
Company's adjusted net income, adjusted earnings per share, adjusted operating
income, adjusted selling, general and administrative expenses, adjusted gross
profit margin, net debt, adjusted earnings before interest taxes, depreciation
and amortization ("EBITDA"), organic sales and organic sales growth. These
measures are not in accordance with financial measures calculated in accordance
with generally accepted accounting principles in
Adjusted EPS, adjusted net income, and adjusted operating income exclude nora purchase accounting amortization, goodwill and intangible asset impairment charges, changes in equity award forfeiture accounting, restructuring charges, severance, asset impairment and other charges. Adjusted EPS and adjusted net income also exclude the loss associated with a warehouse fire. Adjusted gross profit excludes nora purchase accounting amortization. Adjusted SG&A expenses excludes changes in equity award forfeiture accounting, severance, asset impairment and other charges.
Organic sales and organic sales growth exclude the impact of foreign currency fluctuations. Net debt is total debt less cash on hand. Adjusted EBITDA is GAAP net income excluding interest expense, income tax expense, depreciation and amortization, stock compensation amortization, goodwill and intangible asset impairment, restructuring charges, asset impairment, severance and other charges, and nora purchase accounting amortization.
Because the Company engages in acquisitions only episodically, and not as an everyday matter, the Company believes presenting certain measures excluding the effects of acquisitions facilitates focus on normal ongoing operations. The Company also believes presenting sales information absent the effect of foreign currency exchange rate fluctuations facilitates comparison of the Company's operational performance between periods.
The Company generally believes reporting its adjusted results helps investors' understanding of historical operating trends, because it facilitates comparison to prior periods during which unique events affecting more recent results may not have occurred. The Company also believes that adjusted results provide supplemental information for comparisons to other companies which may not have experienced the same events underlying the adjustments. Furthermore, the Company uses adjusted results internally as supplemental information to evaluate its own performance, for planning purposes and in connection with its compensation programs.
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Item 9.01 Financial Statements and Exhibits
(a) Financial Statements of Businesses Acquired.
None.
(b) Pro Forma Financial Information.
None.
(c) Shell Company Transactions.
None. (d) Exhibits. Exhibit No. Description
99.1 Press Release ofInterface, Inc. , datedAugust 7, 2020 , reporting its financial results for the second quarter of 2020 (furnished pursuant to Item 2.02 of this Report). Cover Page Interactive Data File (embedded within the Inline XBRL 104 document)
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