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RBC Bearings Incorporated (ROLL), a leading international
manufacturer of highly-engineered precision plain, roller and ball
bearings for the industrial, defense and aerospace industries, today
reported results for the first quarter of fiscal year 2013.
First Quarter Highlights
Q1 FY 2013 Q1 FY 2012 Change
($ in millions) GAAP Adjusted (1) GAAP GAAP Adjusted (1)
------ ------------ ---------- ----- ------------
Net sales $103.3 $93.3 10.7%
Gross margin $38.4 $31.8 20.9%
Gross margin % 37.2% 34.1%
Operating income $22.0 $17.0 29.3%
Operating income % 21.3% 18.2%
Net income $17.2 $13.9 $10.7 60.2% 30.1%
Diluted EPS $0.76 $0.62 $0.48 58.3% 29.2%
(1) Results exclude items in reconciliation below.
"We are pleased with the strong start reported in our first quarter
fiscal 2013 results, with year-over-year improvements in sales, gross
margin, and earnings," said Dr. Michael J. Hartnett, Chairman and Chief
Executive Officer. "We continue to see solid demand in our core
industrial markets, coupled with further momentum in the aerospace and
defense markets driven by commercial aircraft build rates and the
aerospace aftermarket. The strength of our markets, quality of our
offering, and financial health put us in a position to continue
delivering shareholder value as we execute on our plans for sustainable
growth."
First Quarter Results
Net sales for the first quarter of fiscal 2013 were $103.3 million, an
increase of 10.7% from $93.3 million in the first quarter of fiscal
2012. The increase in net sales was mainly the result of a 6.7% increase
in industrial sales driven by volume in the general industrial markets
and industrial distribution and a 15.3% increase in aerospace and
defense driven by commercial aircraft build rates and the aerospace
aftermarket. Gross margin for the first quarter was $38.4 million
compared to $31.8 million for the same period last year. Gross margin as
a percentage of net sales was 37.2% in the first quarter of fiscal 2013
compared to 34.1% for the same period last year.
SG&A for the first quarter of fiscal 2013 was $16.1 million, an increase
of $1.6 million over the same period last year. As a percentage of net
sales, SG&A was 15.6% for both periods.
Other operating expenses for the first quarter of fiscal 2013 totaled
$0.4 million, an increase of $0.1 million, compared to $0.3 million for
the same period last year. For the first quarter of fiscal 2013 other
operating expenses consisted of $0.4 million of amortization of
intangibles. For the same period last year, other operating expenses
consisted of $0.4 million of amortization of intangibles offset by
miscellaneous income of $0.1 million.
Operating income for the first quarter of fiscal 2013 was $22.0 million,
an increase of 29.3% compared to operating income of $17.0 million for
the same period last year. As a percentage of net sales, operating
income was 21.3% compared to 18.2% for the same period last year.
Interest expense, net for the first quarter of fiscal 2013 was $0.2
million compared to $0.5 million for the same period last year.
Other non-operating income was $3.3 million for the first quarter of
fiscal 2013 compared to other non-operating expense of $0.2 million for
the same period last year. This was mainly due to the receipt of $3.6
million in CDSOA payments in the first quarter of fiscal 2013 offset by
$0.3 million of foreign exchange losses.
Income tax expense for the first quarter of fiscal 2013 was $7.9 million
compared to $5.6 million for the same period last year. Our effective
income tax rate for the first quarter of fiscal 2013 was 31.6% compared
to 34.5% for the same period last year. The effective income tax rate
for the first quarter fiscal 2013 includes a $0.9 million benefit due to
the reversal of unrecognized tax benefits associated with the conclusion
of state income tax audits. The effective income tax rate without these
discrete items would have been 35.0% for the first quarter fiscal 2013.
Net income for the first quarter of fiscal 2013 increased 60.2% to $17.2
million compared to $10.7 million for the same period last year.
Excluding the after tax impact of the CDSOA payment and the discrete tax
benefit, net income would have been $13.9 million for the first quarter
fiscal 2013, an increase of 30.1% compared to $10.7 million for the same
period last year.
Diluted EPS for the first quarter of fiscal 2013 increased 58.3% to 76
cents per share compared to 48 cents per share for the same period last
year. Excluding the after tax impact of the CDSOA payment and the
discrete tax benefit, diluted EPS for the first quarter of fiscal 2013
would have been 62 cents per share compared to 48 cents per share for
the same period last year, an increase of 29.2%.
Backlog, as of June 30, 2012, was $211.5 million compared to $206.4
million as of July 2, 2011.
CDSOA Payment
In the first quarter of fiscal 2013, the Company received approximately
$3.6 million in payments under the U.S. Continued Dumping and Subsidy
Offset Act ("CDSOA"). The CDSOA distributes antidumping duties paid by
overseas companies to qualified domestic firms hurt by unfair trade.
This payment has been classified below Operating income in "Other
non-operating (income) expense" on the Consolidated Statement of
Operations. (For further information please refer to the press release
and 8-K filing dated April 26, 2012).
Live Webcast
RBC Bearings Incorporated will host a webcast at 11:00 a.m. ET today to
discuss the quarterly results. To access the webcast, go to the investor
relations portion of the Company’s website, www.rbcbearings.com,
and click on the webcast icon. If you do not have access to the Internet
and wish to listen to the call, dial 800-920-8624 (international callers
dial 617-597-5430) and enter conference ID # 59564787. An audio replay
of the call will be available from 1:00 p.m. ET on Friday, August 3rd
until 11:59 p.m. ET on Friday, August 10th. The replay can be accessed
by dialing 888-286-8010 (international callers dial 617-801-6888) and
entering conference call ID # 98226152. Investors are advised to dial
into the call at least ten minutes prior to the call to register.
Non-GAAP Financial Measures
In addition to disclosing results of operations that are determined in
accordance with generally accepted accounting principles ("GAAP"), this
press release also discloses non-GAAP results of operations that exclude
certain items. These non-GAAP measures adjust for items that Management
believes are unusual. Management believes that the presentation of these
non-GAAP measures provides useful information to investors regarding the
Company’s results of operations, as these non-GAAP measures allow
investors to better evaluate ingoing business performance. Investors
should consider non-GAAP measures in addition to, not as a substitute
for, financial measures prepared in accordance with GAAP. A
reconciliation of the non-GAAP measures disclosed in the press release
with the most comparable GAAP measures are included in the financial
table attached to this press release.
About RBC Bearings
RBC Bearings Incorporated is an international manufacturer and marketer
of highly engineered precision bearings and components. Founded in 1919,
the Company is primarily focused on producing highly technical or
regulated bearing products requiring sophisticated design, testing, and
manufacturing capabilities for the diversified industrial, aerospace,
and defense markets. Headquartered in Oxford, Connecticut, RBC Bearings
currently employs approximately 2,154 people and operates 23
manufacturing facilities in four countries.
Safe Harbor for Forward Looking Statements
Certain statements in this press release contain "forward-looking
statements." All statements other than statements of historical fact are
"forward-looking statements" for purposes of federal and state
securities laws, including the section of this press release entitled
"Outlook"; any projections of earnings, revenue or other financial items
relating to the Company, any statement of the plans, strategies and
objectives of management for future operations; any statements
concerning proposed future growth rates in the markets we serve; any
statements of belief; any characterization of and the Company’s ability
to control contingent liabilities; anticipated trends in the Company’s
businesses; and any statements of assumptions underlying any of the
foregoing. Forward-looking statements may include the words "may,"
"estimate," "intend," "continue," "believe," "expect," "anticipate," and
other similar words. Although the Company believes that the expectations
reflected in any forward-looking statements are reasonable, actual
results could differ materially from those projected or assumed in any
of our forward-looking statements. Our future financial condition and
results of operations, as well as any forward-looking statements, are
subject to change and to inherent risks and uncertainties beyond the
control of the Company. These risks and uncertainties include, but are
not limited to, risks and uncertainties relating to general economic
conditions, geopolitical factors, future levels of general industrial
manufacturing activity, future financial performance, market acceptance
of new or enhanced versions of the Company’s products, the pricing of
raw materials, changes in the competitive environments in which the
Company’s businesses operate, the outcome of pending or future
litigation and governmental proceedings and approvals, estimated legal
costs, increases in interest rates, the Company’s ability to meet its
debt obligations, and risks and uncertainties listed or disclosed in the
Company’s reports filed with the Securities and Exchange Commission,
including, without limitation, the risks identified under the heading
"Risk Factors" set forth in the Company’s most recent Annual Report
filed on Form 10-K. The Company does not intend, and undertakes no
obligation, to update or alter any forward-looking statements.
RBC Bearings Incorporated
Consolidated Statements of Operations
(dollars in thousands, except share and per share data)
(Unaudited)
Three Months Ended
---------------------------------------
June 30, July 2,
2012 2011
-------------------- ------------------
Net sales $ 103,334 $ 93,333
Cost of sales 64,891 61,537
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Gross margin 38,443 31,796
Operating expenses:
Selling, general and administrative 16,097 14,533
Other, net 352 250
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Total operating expenses 16,449 14,783
Operating income 21,994 17,013
Interest expense, net 215 472
Other non-operating (income) expense (3,301 ) 196
---------- - ----------
Income before income taxes 25,080 16,345
Provision for income taxes 7,916 5,633
---------- ----------
Net income $ 17,164 $ 10,712
====== ========== ====== ==========
Net income per common share:
Basic $ 0.78 $ 0.49
Diluted $ 0.76 $ 0.48
Weighted average common shares:
Basic 22,030,272 21,833,754
Diluted 22,596,404 22,308,598
Reconciliation of Reported Net Income and Net Income Three Months Ended
---------------------------------
Per Common Share to Adjusted Net Income and June 30, July 2,
Adjusted Net Income Per Common Share: 2012 2011
-------------------- ------------------
Reported net income $ 17,164 $ 10,712
CDSOA payment after taxes (2,368 ) -
Discrete tax benefit (862 ) -
---------- - ----------
Adjusted net income $ 13,934 $ 10,712
====== ========== ====== ==========
Adjusted net income per common share:
Basic $ 0.63 $ 0.49
Diluted $ 0.62 $ 0.48
Weighted average common shares:
Basic 22,030,272 21,833,754
Diluted 22,596,404 22,308,598
Three Months Ended
---------------------------------------
June 30, July 2,
Segment Data, Net External Sales: 2012 2011
-------------------- ------------------
Plain bearings segment $ 55,397 $ 47,148
Roller bearings segment 31,397 28,166
Ball bearings segment 9,387 10,088
Other segment 7,153 7,931
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$ 103,334 $ 93,333
====== ========== ====== ==========
Three Months Ended
---------------------------------------
June 30, July 2,
Selected Financial Data: 2012 2011
-------------------- ------------------
Depreciation and amortization $ 3,683 $ 3,557
Incentive stock compensation expense $ 1,127 $ 1,005
Cash provided by operating activities $ 26,517 $ 11,985
Capital expenditures $ 6,057 $ 1,955
Total debt $ 992 $ 1,147
Cash and short-term investments $ 90,921 $ 51,223
Backlog $ 211,532 $ 206,369
SOURCE: RBC Bearings Incorporated
RBC Bearings
Daniel A. Bergeron, 203-267-5028
dbergeron@rbcbearings.com
or
FTI Consulting
Michael Cummings, 617-897-1532
investors@rbcbearings.com
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