Adjusted measures are reconciled to GAAP at the end of this release. Financial and operating comparisons are versus the prior year period. Figures may not sum to total due to rounding. Definitions: Advanced Materials & Structures (AMS), Engineered Papers (EP), low ignition propensity (LIP), "organic" - pro forma for
Third Quarter 2021 Financial Results Summary
- Continued strong demand in AMS, highlighted by 10% organic sales growth, offset by escalating input cost inflation and supply chain challenges across the business
- Total sales were
$383.6 million , up 37.3%, but down 1% on organic basis - GAAP operating profit was
$23.0 million , or 6.0% of sales, down$14.0 million ; Adjusted operating profit was$40.0 million , or 10.4% of sales, down$12.7 million - GAAP EPS was
$0.38 , down from$0.78 ; Adjusted EPS was$0.82 , down from$1.16 ; difficult earnings comparison to an exceptionally strong third quarter of 2020 - Management now expects full year 2021 Adjusted EPS to finish below the
$3.75 to$4.05 guidance range provided in May, with fourth quarter Adjusted EPS expected to be down approximately 20% versus prior year quarter (see Management Commentary and Business Outlook sections below for additional detail)
MManagement Commentary
Dr.
"AMS delivered 10% organic sales growth in the third quarter, highlighted by approximately 25% growth in both transportation and filtration sales. Demand fundamentals remain strong and our order books across AMS give us confidence in continued growth. Scapa's sales are also performing well, showing a strong rebound versus last year and nearing pre-Covid levels. Within EP, we faced a difficult comparison to last year's particularly strong third quarter, when several customers built LIP inventories to de-risk their supply chains. This factor, combined with anticipated industry attrition, led to a 12% sales decline."
"Consistent with the widely publicized strained supply chain themes such as rapid inflation, labor challenges and input scarcity we continue to see margin pressures, though we believe we are nearing a turning point with respect to some of these headwinds. Market forecasts indicate raw material prices for polypropylene resin and wood pulp easing towards year-end and into 2022, after unexpectedly rising to record highs throughout 2021. We have and continue to increase prices to align with these costs, and together with our contractual price escalators, we expect improved price/cost dynamics next year. Also, to offset the current scarcity of some specialty resins for our transportation films, which has constrained our total growth thus far in 2021, we have qualified new supply sources. This increased material access for 2022 should support double-digit growth in this highly strategic and profitable product line. Finally, in response to the labor challenges highlighted by so many companies, we have made salary adjustments, added additional focus on retention, and are accelerating our manufacturing automation and efficiency projects.
Third Quarter 2021 Financial Results
Advanced Materials & Structures segment sales were
GAAP operating profit was
Engineered Papers segment sales were
GAAP operating profit was
Unallocated GAAP expenses were
Consolidated sales were
GAAP income was
Interest expense was
The Company reported a tax rate of 13.2%, versus 17.0% in the prior year period. Excluding the effect of non-GAAP adjustments, the third quarter 2021 tax rate was 17.2% (the implied rate reflected in the Company's Adjusted EPS), versus 19.7% in the prior year quarter, due to a more favorable geographic mix of earnings.
The Company's Chinese JVs contributed
Net currency movements had a
Non-GAAP Adjustments reflect items included in GAAP operating profit, income, and EPS, but excluded from adjusted operating profit, income, and EPS (see non-GAAP reconciliation tables). The most significant adjustments to third quarter 2021 results were purchase accounting expenses of
2021 Year-to-Date Financial Results
Advanced Materials & Structures segment sales were
GAAP operating profit was
Engineered Papers segment sales were
GAAP operating profit was
Unallocated GAAP expenses were
Consolidated sales were
GAAP income was
Adjusted income was
Interest expense was
The Company reported a tax rate of 29.6%, versus 18.9% in the prior year period. The higher rate is primarily due to the high second quarter 2021 tax rate related to significant discrete items. These discrete items largely relate to the Scapa acquisition and are not expected to yield a material impact to the Company's effective tax rate or cash tax when incorporated into the anticipated full year results. Excluding the impact of non-GAAP adjustments, the year-to-date tax rate was 19.7% (the implied rate reflected in the Company's Adjusted EPS), versus 20.8% in the prior year period due to a more favorable geographic mix of earnings.
The Company's Chinese JVs contributed
Net currency movements were a
Non-GAAP Adjustments reflect items included in GAAP operating profit, income, and EPS, but excluded from adjusted operating profit, income, and EPS (see non-GAAP reconciliation tables). The most significant adjustments to year-to-date 2021 results were related to the Scapa acquisition. The Company incurred
Cash Flow, Debt, Liquidity, & Dividend
Year-to-date 2021 cash provided by operating activities was
Capital spending and capitalized software totaled
Total debt was
Pursuant to the terms of the Company's credit agreement, net debt to adjusted EBITDA was 4.8x as of
The Company announced a quarterly cash dividend of
Business Outlook
Given performance to-date and the expectation that fourth quarter results will reflect continued impacts from inflationary and supply chain pressures, the Company projects full year Adjusted EPS will be below the previously provided range of
Conference Call
SWM will hold a conference call to review third quarter 2021 results with investors and analysts at
SWM will use a presentation in conjunction with its conference call. The presentation can be found on the Company's website under the Investor Relations section in advance of the earnings conference call. The presentation can also be accessed via the earnings conference call webcast.
About SWM
SWM is a leading global performance materials company, focused on bringing best-in-class innovation, design, and manufacturing solutions to our customers. Our highly engineered films, adhesive tapes, foams, nets, nonwovens, and papers are designed and manufactured using resins, polymers, and natural fibers for a variety of industries and specialty applications. SWM and its subsidiaries manufacture on four continents, conduct business in over 90 countries and employ approximately 5,000 people worldwide. For further information, please visit SWM’s website at www.swmintl.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to the safe harbor created by that Act and other legal protections. Forward-looking statements include, without limitation, those regarding the incurrence of additional debt, future performance, capital expenditures, future market and EPS trends and guidance, the future effects of supply chain challenges and price increases, sales and volume trends, growth prospects, currency rates and trends and impact on EPS, future cash flows, net leverage, purchase accounting impacts, effective tax rates, planned investments, impacts of the COVID-19 pandemic on our operations, profitability, and cash flow, the expected benefits and accretion of the Scapa acquisition and integration, and other statements generally identified by words such as "believe," "expect," "intend," "guidance," "plan," "forecast," "potential," "anticipate," "confident," "project," "appear," "future," "should," "likely," "could," "may," "typically," "will," and similar words.
These forward-looking statements are prospective in nature and not based on historical facts, but rather on current expectations and on numerous assumptions regarding the business strategies and the environment in which our business shall operate in the future and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by those statements. No assurance can be given that such expectations will prove to have been correct and persons reading this presentation are therefore cautioned not to place undue reliance on these forward-looking statements which speak only as at the date of this press release. These statements are not guarantees of future performance and are subject to certain risks, uncertainties (some of which are beyond the Company’s control) and assumptions that may cause actual results to differ materially from our expectations as of the date of this release. These risks include, among other things, the following factors:
- Risks associated with pandemics and other public health emergencies, including the continued impact of, and the governmental and third party response to, the COVID-19 pandemic and its variant strains (including any proposed new regulation concerning mandatory COVID-19 vaccination of employees);
- Changes in sales or production volumes, pricing and/or manufacturing costs of Recon products, cigarette paper (including for LIP cigarettes), including any change by our customers in their tobacco and tobacco-related blends for their cigarettes, their target inventory levels and/or the overall demand for their products, new technologies such as e-cigarettes, inventory adjustments and rebalancings in our EP segment. Additionally, competition and changes in AMS end-market products due to changing customer demands;
- Changes in the Chinese economy, including relating to the demand for reconstituted tobacco, premium cigarettes and netting and due to impact of tariffs;
- Risks associated with the implementation of our strategic growth initiatives, including diversification, and the Company's understanding of, and entry into, new industries and technologies;
- Changes in the source and intensity of competition in our commercial segments;
- Our ability to attract and retain key personnel;
- Weather conditions, including potential impacts, if any, from climate change, known and unknown, seasonality factors that affect the demand for virgin tobacco leaf and natural disasters or unusual weather events;
- Seasonal or cyclical market and industry fluctuations which may result in reduced net sales and operating profits during certain periods;
- Increases in commodity prices and lack of availability of such commodities, including energy, wood pulp and resins, which could impact the sales and profitability of our products;
- Adverse changes in the oil, gas, automotive, construction and infrastructure, and mining sectors impacting key AMS segment customers;
- Increases in operating costs due to inflation or otherwise, such as labor expense, compensation and benefits costs;
- Employee retention and labor shortages;
- Changes in employment, wage and hour laws and regulations in the
U.S. ,France and elsewhere, including the loi de Securisation de l'emploi inFrance , unionization rule and regulations by theNational Labor Relations Board in theU.S. , equal pay initiatives, additional anti-discrimination rules or tests and different interpretations of exemptions from overtime laws; - Labor strikes, stoppages, disruptions or other disruptions at our facilities;
- The impact of tariffs, and the imposition of any future additional tariffs and other trade barriers, and the effects of retaliatory trade measures;
- Existing and future governmental regulation and the enforcement thereof, for example relating to the tobacco industry, taxation and the environment (including the impact thereof on our Chinese joint ventures);
- New reports as to the effect of smoking on human health or the environment;
- Changes in general economic, financial and credit conditions in the
U.S. ,Europe ,China and elsewhere, including the impact thereof on currency exchange rates (including any weakening of the Euro and Real) and on interest rates and the effects of the ongoing discussions between theU.K. andEuropean Union to determine the terms of theU.K.'s withdrawal from theEuropean Union ; - Changes in the method pursuant to which LIBOR rates are determined and the phasing out of USD LIBOR after 2023;
- Changes in the manner in which we finance our debt and future capital needs, including potential acquisitions;
- The success of, and costs associated with, our current or future restructuring initiatives, including the granting of any needed governmental approvals and the occurrence of work stoppages or other labor disruptions;
- Changes in the discount rates, revenue growth, cash flow growth rates or other assumptions used by the Company in its assessment for impairment of assets and adverse economic conditions or other factors that would result in significant impairment charges;
- Supply chain disruptions, including the failure of one or more material suppliers, including energy, resin and pulp suppliers, to supply materials as needed to maintain our product plans and cost structure;
- International conflicts and disputes, which restrict our ability to supply products into affected regions, due to the corresponding effects on demand, the application of international sanctions, or practical consequences on transportation, banking transactions, and other commercial activities in troubled regions;
- Compliance with the FCPA and other anti-corruption laws or trade control laws, as well as other laws governing our operations;
- The pace and extent of further international adoption of LIP cigarette standards and the nature of standards so adopted;
- Risks associated with our 50%-owned, non-
U.S. joint ventures relating to control and decision-making, compliance, accounting standards, transparency and customer relations, among others; - A failure in our risk management and/or currency or interest rate swaps and hedging programs, including the failures of any insurance company or counterparty;
- The number, type, outcomes (by judgment or settlement) and costs of legal, tax, regulatory or administrative proceedings, litigation and/or amnesty programs, including those in
Brazil ,France andGermany ; - The outcome and cost of LIP-related intellectual property infringement and validity litigation in
Europe and theGlatz's German Patent Court invalidation proceedings; - Risks associated with our technological advantages in our intellectual property and the likelihood that our current technological advantages are unable to continue indefinitely;
- Risks associated with acquisitions or other strategic transactions, including acquired liabilities and restrictions, retaining customers from businesses acquired, achieving any expected results or synergies from acquired businesses, complying with new regulatory frameworks, difficulties in integrating acquired businesses or implementing strategic transactions generally and risks associated with international acquisition transactions, including in countries where we do not currently have a material presence;
- Risks associated with dispositions, including post-closing claims being made against us, disruption to our other businesses during a sale process or thereafter, credit risks associated with any buyer of such disposed assets and our ability to collect funds due from any such buyer;
- Risks associated with our global asset realignment initiatives, including: changes in tax law, treaties, interpretations, or regulatory determinations; audits made by applicable regulatory authorities and/or our auditor; and our ability to operate our business in a manner consistent with the regulatory requirements for such realignment;
- Increased taxation on tobacco-related products;
- Costs and timing of implementation of any upgrades or changes to our information technology systems;
- Failure by us to comply with any privacy or data security laws or to protect against theft of customer, employee and corporate sensitive information;
- Changes in tax rates, the adoption of new
U.S. or international tax legislation or exposure to additional tax liabilities; - Changes in construction and infrastructure spending and its impact on demand for certain products;
- Potential loss of consumer awareness and demand for acquired companies’ products if it is decided to rebrand those products under the Company’s legacy brand names; and
- Other factors described elsewhere in this document and from time to time in documents that we file with the
SEC .
All forward-looking statements made in this document are qualified by these cautionary statements. Forward-looking statements herein are made only as of the date of this document, and we do not undertake any obligation, other than as may be required by law, to update or revise any forward-looking or cautionary statements to reflect changes in assumptions, the occurrence of events, unanticipated or otherwise, or changes in future operating results over time or otherwise.
Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance unless expressed as such and should only be viewed as historical data. The financial results reported in this release are unaudited.
For additional factors and further discussion of these factors, please see SWM's Annual Report on Form 10-K for the year ended
Non-GAAP Financial Measures
Certain financial measures and comments contained in this press release exclude restructuring and impairment expenses, certain purchase accounting adjustments related to AMS segment acquisitions, acquisition and integration related costs, interest expense, the effect of income tax provisions and other tax impacts, capital spending, capitalized software costs, and depreciation and amortization. This press release also provides certain information regarding the Company's financial results excluding currency impacts. This information estimates the impact of changes in foreign currency rates on the translation of the Company's current financial results as compared to the applicable comparable period and is derived by translating the current local currency results into
The Company believes that the presentation of non-GAAP financial measures in addition to the related GAAP measures provides investors with greater transparency on the information used by the Company’s management in its financial and operational decision-making. Management also believes that the non-GAAP financial measures provide additional insight for analysts and investors in evaluating the Company’s financial and operational performance in the same way that management evaluates the Company's financial performance. Management believes that providing this information enables investors to better understand the Company’s operating performance and financial condition. These non-GAAP financial measures are not calculated or presented in accordance with, and are not intended to be considered in isolation or as alternatives or substitutes for, or superior to, financial measures prepared and presented in accordance with GAAP, and should be read only in conjunction with the Company's financial measures prepared and presented in accordance with GAAP. The non-GAAP financial measures used in this release may be different from the measures used by other companies.
SOURCE SWM:
CONTACT
Chief Financial Officer
+1-770-569-4271
Or
Director of Investor Relations
+1-770-569-4229 (o)
+1-917-365-0085 (c)
Website: http://www.swmintl.com
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Dollars in millions, except per share amounts)
(Unaudited)
Three Months Ended | ||||||||||
2021 | 2020 | % Change | ||||||||
Net sales | $ | 383.6 | $ | 279.3 | 37.3 | % | ||||
Cost of products sold | 298.4 | 199.1 | 49.9 | |||||||
Gross profit | 85.2 | 80.2 | 6.2 | |||||||
Selling expense | 13.2 | 9.0 | 46.7 | |||||||
Research and development expense | 5.7 | 3.6 | 58.3 | |||||||
General expense | 41.4 | 24.6 | 68.3 | |||||||
Total nonmanufacturing expenses | 60.3 | 37.2 | 62.1 | |||||||
Restructuring and impairment expense | 1.9 | 6.0 | (68.3) | |||||||
Operating profit | 23.0 | 37.0 | (37.8) | |||||||
Interest expense | 15.3 | 7.8 | 96.2 | |||||||
Other income (expense), net | 3.7 | (1.0) | N.M. | |||||||
Income before income taxes and income from equity affiliates | 11.4 | 28.2 | (59.6) | |||||||
Provision for income taxes | 1.5 | 4.8 | (68.8) | |||||||
Income from equity affiliates, net of income taxes | 2.3 | 1.1 | N.M. | |||||||
Net income | $ | 12.2 | $ | 24.5 | (50.2) | % | ||||
Net income per share - basic: | ||||||||||
Net income per share – basic | $ | 0.38 | $ | 0.78 | (51.3) | % | ||||
Net income per share – diluted: | ||||||||||
Net income per share – diluted | $ | 0.38 | $ | 0.78 | (51.3) | % | ||||
Cash dividends declared per share | $ | 0.44 | $ | 0.44 | ||||||
Weighted average shares outstanding: | ||||||||||
Basic | 31,046,100 | 30,909,700 | ||||||||
Diluted | 31,401,000 | 31,142,500 |
N.M. - Not Meaningful
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in millions, except per share amounts)
(Unaudited)
Nine Months Ended | ||||||||||
2021 | 2020 | % Change | ||||||||
Net sales | $ | 1,049.6 | $ | 795.0 | 32.0 | % | ||||
Cost of products sold | 795.5 | 566.2 | 40.5 | |||||||
Gross profit | 254.1 | 228.8 | 11.1 | |||||||
Selling expense | 34.2 | 27.3 | 25.3 | |||||||
Research and development expense | 14.9 | 10.4 | 43.3 | |||||||
General expense | 126.7 | 77.9 | 62.6 | |||||||
Total nonmanufacturing expenses | 175.8 | 115.6 | 52.1 | |||||||
Restructuring and impairment expense | 5.9 | 7.7 | (23.4) | |||||||
Operating profit | 72.4 | 105.5 | (31.4) | |||||||
Interest expense | 31.3 | 22.8 | 37.3 | |||||||
Other income (expense), net | 0.8 | (0.7) | N.M. | |||||||
Income from continuing operations before income taxes and income from equity affiliates | 41.9 | 82.0 | (48.9) | |||||||
Provision for income taxes | 12.4 | 15.5 | (20.0) | |||||||
Income from equity affiliates, net of income taxes | 6.1 | 2.0 | N.M. | |||||||
Net income | $ | 35.6 | $ | 68.5 | (48.0) | % | ||||
Net income per share - basic: | ||||||||||
Net income per share – basic | $ | 1.13 | $ | 2.19 | (48.4) | % | ||||
Net income per share – diluted: | ||||||||||
Net income per share – diluted | $ | 1.12 | $ | 2.18 | (48.6) | % | ||||
Cash dividends declared per share | $ | 1.32 | $ | 1.32 | ||||||
Weighted average shares outstanding: | ||||||||||
Basic | 31,022,100 | 30,805,300 | ||||||||
Diluted | 31,381,600 | 31,020,100 |
N.M. - Not Meaningful
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
(Unaudited)
2021 | 2020 | ||||||
ASSETS | |||||||
Cash and cash equivalents | $ | 73.6 | $ | 54.7 | |||
Accounts receivable, net | 242.2 | 148.5 | |||||
Inventories | 261.3 | 179.7 | |||||
Other current assets | 32.7 | 13.5 | |||||
Property, plant and equipment, net | 467.5 | 339.0 | |||||
660.0 | 403.7 | ||||||
Other noncurrent assets | 682.5 | 445.8 | |||||
Total Assets | $ | 2,419.8 | $ | 1,584.9 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current debt | $ | 18.0 | $ | 2.8 | |||
Other current liabilities | 228.6 | 164.1 | |||||
Long-term debt | 1,288.2 | 590.5 | |||||
Pension and other postretirement benefits | 39.5 | 36.5 | |||||
Deferred income tax liabilities | 109.3 | 45.1 | |||||
Long-term income tax payable | 16.6 | 17.7 | |||||
Other noncurrent liabilities | 83.9 | 78.6 | |||||
Stockholders’ equity | 635.7 | 649.6 | |||||
Total Liabilities and Stockholders’ Equity | $ | 2,419.8 | $ | 1,584.9 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW
(Dollars in millions)
(Unaudited)
Nine Months Ended | |||||||
2021 | 2020 | ||||||
Operating | |||||||
Net income | $ | 35.6 | $ | 68.5 | |||
Non-cash items included in net income: | |||||||
Depreciation and amortization | 70.3 | 52.3 | |||||
Deferred income tax | 2.4 | 1.5 | |||||
Pension and other postretirement benefits | (0.2) | 2.6 | |||||
Stock-based compensation | 6.3 | 5.6 | |||||
Income from equity affiliates | (6.1) | (2.0) | |||||
(6.1) | — | ||||||
Cash dividends received from equity affiliates | 0.8 | 2.7 | |||||
Other items | (4.4) | (4.7) | |||||
Changes in operating working capital | (71.1) | (19.0) | |||||
Cash provided by operations | 27.5 | 107.5 | |||||
Investing | |||||||
Capital spending | (23.8) | (20.7) | |||||
Capitalized software costs | (1.9) | (2.8) | |||||
Acquisitions, net of cash acquired | (630.6) | (169.3) | |||||
Other investing | (2.0) | 2.3 | |||||
Cash used in investing | (658.3) | (190.5) | |||||
Financing | |||||||
Cash dividends paid to SWM stockholders | (41.5) | (41.2) | |||||
Proceeds from issuances of long-term debt | 729.7 | 212.7 | |||||
Payments on long-term debt | (19.5) | (124.6) | |||||
Payments for debt issuance costs | (14.6) | — | |||||
Purchases of common stock | (3.1) | (0.9) | |||||
Cash provided by financing | 651.0 | 46.0 | |||||
Effect of exchange rate changes on cash and cash equivalents | (1.3) | 0.3 | |||||
Increase (decrease) in cash and cash equivalents | $ | 18.9 | $ | (36.7) |
BUSINESS SEGMENT REPORTING
(Dollars in millions)
(Unaudited)
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
2021 | 2020 | % Change | 2021 | 2020 | % Change | ||||||||||||||||
AMS | $ | 260.1 | $ | 138.9 | 87.3 | % | $ | 675.1 | $ | 394.6 | 71.1 | % | |||||||||
EP | 123.5 | 140.4 | (12.0) | % | 374.5 | 400.4 | (6.5) | % | |||||||||||||
Total Consolidated | $ | 383.6 | $ | 279.3 | 37.3 | % | $ | 1,049.6 | $ | 795.0 | 32.0 | % |
Operating Profit | |||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
Return on | Return on | ||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
AMS | $ | 15.9 | $ | 18.5 | 6.1 | % | 13.3 | % | $ | 56.1 | $ | 45.3 | 8.3 | % | 11.5 | % | |||||||||||
EP | 24.0 | 28.2 | 19.4 | % | 20.1 | % | 78.1 | 93.3 | 20.9 | % | 23.3 | % | |||||||||||||||
Unallocated | (16.9) | (9.7) | (61.8) | (33.1) | |||||||||||||||||||||||
Total Consolidated | $ | 23.0 | $ | 37.0 | 6.0 | % | 13.2 | % | $ | 72.4 | $ | 105.5 | 6.9 | % | 13.3 | % |
Non-GAAP Adjustments to Operating Profit | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||
AMS - Restructuring & Impairment Expenses | $ | — | $ | — | $ | — | $ | 0.5 | |||||||
AMS - Purchase Accounting Adjustments | 11.3 | 6.5 | 32.1 | 19.3 | |||||||||||
EP - Restructuring, impairment Expenses, and plant closure expenses | 2.4 | 9.1 | 6.4 | 10.3 | |||||||||||
Unallocated - Acquisition and Integration Related Costs | 3.3 | 0.1 | 19.0 | 0.1 | |||||||||||
Total Consolidated | $ | 17.0 | $ | 15.7 | $ | 57.5 | $ | 30.2 |
Adjusted Operating Profit | |||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
Return on | Return on | ||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
AMS | $ | 27.2 | $ | 25.0 | 10.5 | % | 18.0 | % | $ | 88.2 | $ | 65.1 | 13.1 | % | 16.5 | % | |||||||||||
EP | 26.4 | 37.3 | 21.4 | % | 26.6 | % | 84.5 | 103.6 | 22.6 | % | 25.9 | % | |||||||||||||||
Unallocated | (13.6) | (9.6) | (42.8) | (33.0) | |||||||||||||||||||||||
Total Consolidated | $ | 40.0 | $ | 52.7 | 10.4 | % | 18.9 | % | $ | 129.9 | $ | 135.7 | 12.4 | % | 17.1 | % |
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTAL DATA
(Dollars in millions, except per share amounts)
Three Months Ended | Nine Months Ended | ||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||
Operating profit | $ | 23.0 | $ | 37.0 | $ | 72.4 | $ | 105.5 | |||||||
Plus: Restructuring expenses | 2.4 | 9.2 | 6.4 | 10.9 | |||||||||||
Plus: Purchase accounting adjustments | 11.3 | 6.5 | 32.1 | 19.3 | |||||||||||
Plus: Acquisition and integration related costs | 3.3 | — | 19.0 | — | |||||||||||
Adjusted Operating Profit | $ | 40.0 | $ | 52.7 | $ | 129.9 | $ | 135.7 | |||||||
Income | $ | 12.2 | $ | 24.5 | $ | 35.6 | $ | 68.5 | |||||||
Plus: Restructuring and impairment Expenses | 1.9 | 6.0 | 5.9 | 7.7 | |||||||||||
Less: Tax impact of restructuring and impairment expense | (0.5) | (1.5) | (1.5) | (2.0) | |||||||||||
Plus: Plant closure | 0.5 | 3.2 | 0.5 | 3.2 | |||||||||||
Less: Tax impact of plant closure | (0.1) | (0.7) | (0.1) | (0.7) | |||||||||||
Plus: Purchase accounting adjustments | 11.3 | 6.5 | 32.1 | 19.3 | |||||||||||
Less: Tax impact of purchase accounting adjustments | (2.2) | (1.6) | (6.4) | (4.7) | |||||||||||
Plus: | — | — | (6.1) | — | |||||||||||
Less: Tax impact of | 0.3 | — | 2.8 | — | |||||||||||
Plus: Acquisition and integration related costs | 3.3 | — | 19.0 | — | |||||||||||
Less: Tax impact on acquisition and integration related costs | (0.8) | — | (4.2) | — | |||||||||||
Plus: Acquisition related foreign currency exchange impacts | — | — | 6.9 | — | |||||||||||
Less: Tax Impact on acquisition related foreign currency exchange impacts | — | — | — | — | |||||||||||
Less: Tax legislative changes, net of other discrete items | (0.1) | — | 2.1 | (0.4) | |||||||||||
Adjusted Income | $ | 25.8 | $ | 36.4 | $ | 86.6 | $ | 90.9 | |||||||
Earnings per share - diluted | $ | 0.38 | $ | 0.78 | $ | 1.12 | $ | 2.18 | |||||||
Plus: Restructuring and impairment Expenses | 0.06 | 0.19 | 0.19 | 0.25 | |||||||||||
Less: Tax impact of restructuring and impairment expense | (0.02) | (0.04) | (0.05) | (0.06) | |||||||||||
Plus: Plant closure | 0.02 | 0.10 | 0.02 | 0.10 | |||||||||||
Less: Tax impact of plant closure | — | (0.02) | — | (0.02) | |||||||||||
Plus: Purchase accounting adjustments | 0.36 | 0.20 | 1.02 | 0.62 | |||||||||||
Less: Tax impact of purchase accounting adjustment | (0.07) | (0.05) | (0.21) | (0.15) | |||||||||||
Plus: | — | — | (0.20) | — | |||||||||||
Less: Tax impact of | 0.01 | — | 0.09 | — | |||||||||||
Plus: Acquisition and integration related costs | 0.10 | — | 0.60 | — | |||||||||||
Less: Tax impact on acquisition and integration related costs | (0.02) | — | (0.13) | — | |||||||||||
Plus: Acquisition related foreign currency exchange impacts | — | — | 0.22 | — | |||||||||||
Less: Tax legislative changes, net of other discrete items | — | — | 0.07 | (0.01) | |||||||||||
Adjusted Earnings Per Share - Diluted | $ | 0.82 | $ | 1.16 | $ | 2.74 | $ | 2.91 | |||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES AND SUPPLEMENTAL DATA
(Dollars in millions, except per share amounts)
Three Months Ended | Nine Months Ended | ||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||
Net income | $ | 12.2 | $ | 24.5 | $ | 35.6 | $ | 68.5 | |||||||
Plus: Interest expense on debt | 15.3 | 7.8 | 35.8 | 22.8 | |||||||||||
Plus: Reversal of interest expense on | — | — | (4.5) | — | |||||||||||
Plus: Provision for income taxes | 1.5 | 4.8 | 12.4 | 15.5 | |||||||||||
Plus: Depreciation and amortization | 24.1 | 19.2 | 67.5 | 50.8 | |||||||||||
Plus: Restructuring and impairment Expenses | 1.9 | 6.0 | 5.9 | 7.7 | |||||||||||
Plus: Inventory write-down expense related to plant closure | 0.5 | 2.0 | 0.5 | 2.0 | |||||||||||
Plus: Acquisition and integration related costs | 3.3 | — | 19.0 | — | |||||||||||
Plus: Income from equity affiliates | (2.3) | (1.1) | (6.1) | (2.0) | |||||||||||
Plus: Other (income) loss, net | (3.7) | 1.0 | (6.1) | 0.7 | |||||||||||
Plus: Acquisition related foreign currency exchange impacts | — | — | 6.9 | — | |||||||||||
Plus: Reversal of other expenses related to | — | — | (1.6) | — | |||||||||||
Adjusted EBITDA | $ | 52.8 | $ | 64.2 | $ | 165.3 | $ | 166.0 | |||||||
AMS adjusted EBITDA | $ | 34.3 | $ | 29.1 | $ | 106.6 | $ | 76.6 | |||||||
EP adjusted EBITDA | 32.0 | 44.4 | 100.9 | 121.7 | |||||||||||
Unallocated adjusted EBITDA | (13.5) | (9.3) | (42.2) | (32.3) | |||||||||||
Adjusted EBITDA | $ | 52.8 | $ | 64.2 | $ | 165.3 | $ | 166.0 | |||||||
Cash provided by operating activities | $ | 7.7 | $ | 58.2 | $ | 27.5 | $ | 107.5 | |||||||
Less: Capital spending | (7.5) | (5.8) | (23.8) | (20.7) | |||||||||||
Less: Capitalized software costs | (0.6) | (1.1) | (1.9) | (2.8) | |||||||||||
Free Cash Flow | $ | (0.4) | $ | 51.3 | $ | 1.8 | $ | 84.0 | |||||||
Total Debt | $ | 1,306.2 | $ | 593.3 | |||||||||||
Less: Cash | 73.6 | 54.7 | |||||||||||||
Net Debt | $ | 1,232.6 | $ | 538.6 |
Source:
2021 GlobeNewswire, Inc., source