Robbins & Myers Reports Strong Finish to Record Year
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DAYTON, Ohio, Oct. 9 /PRNewswire-FirstCall/ -- Robbins & Myers, Inc. (NYSE: RBN) today reported diluted net earnings per share (DEPS) of $0.88 for its fiscal fourth quarter ended August 31, 2008, including $0.12 from the release of tax valuation allowances for existing net operating losses (NOL) and a $0.02 gain from the fourth quarter sale of an unused property. In the prior year fourth quarter, the Company reported $0.55 of DEPS, which included a $0.03 gain from the sale of an unused property.
Robbins & Myers earned $2.52 per diluted common share for the full year ended August 31, 2008, as compared with $1.48 in the prior year, an increase of 70%. Fiscal 2008 results included $0.17 of NOL benefits and $0.18 from three asset sale gains reported throughout the year, and prior year results included $0.06 of benefit from asset sales, net of restructuring costs. Excluding these items, DEPS increased from $1.42 in fiscal 2007 to $2.17 in fiscal 2008, primarily as a result of higher sales, an improved cost structure and a lower normalized effective tax rate.
Fiscal fourth quarter 2008 sales increased 10% over the prior year fourth quarter to $228 million, and orders increased 5% to $198 million. Excluding the impact from acquired and disposed product lines and currency translation, organic sales increased 3%, with increases noted in all three business platforms, and organic orders increased 4%, led by strength in energy markets. For the full fiscal 2008 year, sales increased 13% over the prior year to $787 million, and orders increased 13% to $813 million. On an organic basis, full year sales and orders grew 6% and 7%, respectively.
"I am pleased to report a strong finish to fiscal 2008," said Peter C. Wallace, President and Chief Executive Officer of Robbins & Myers, Inc. "We again achieved year-over-year sales and order growth, reflecting market strength and our successful customer and market-based initiatives. With our improved cost structure, we leveraged our sales growth into even higher earnings growth. Our focus on cash flow enabled us to generate nearly $90 million of cash from operations during the year, 38% higher than last year. I thank our worldwide associates for their contributions towards our record performance."
The Company reported fourth quarter 2008 earnings before interest, taxes and minority interest (EBIT) of $41 million. Excluding the gains from property sales in the fourth quarters of fiscal 2007 and 2008, fourth quarter 2008 adjusted EBIT increased 15% over prior year fourth quarter results. The adjusted EBIT margin of 17.7% for fiscal Q4 2008 is 80 basis points higher than the comparable prior year period. Robbins & Myers also reported $44 million of adjusted EBITDA in the fourth quarter of 2008 and $137 million for the full year.
Mr. Wallace commented, "Our backlog and recent order activity give us a good start to the new fiscal year. We continue to make progress in our continuous improvement initiatives, providing another avenue of long-term earnings growth. We are actively pursuing acquisition opportunities that could expand our product offering and geographic reach. The Company begins fiscal 2009 in a secure financial position with $123 million of cash and an undrawn senior credit facility provided by six banks. We are well-positioned as we start fiscal 2009 but also recognize the economic environment has become more challenging."
Robbins & Myers announced its expectations for fiscal 2009 DEPS of $2.40-$2.55, which represents an 11-18% increase over fiscal 2008 adjusted DEPS of $2.17 (excluding NOL benefits and asset sale gains). The Company also expects fiscal first quarter 2009 DEPS of $0.45-$0.50, as compared with actual results of $0.40 in the first quarter of fiscal 2008.
Fourth Quarter Results by Segment
All comparisons are made against the comparable year-ago quarterly period unless otherwise stated.
The Fluid Management segment reported fourth quarter sales of $90 million, an 8% increase, and orders of $99 million, a 23% increase. Excluding currency exchange rate effects, organic sales increased 6% and organic orders improved 23% on continued strength in energy markets and new product contributions. EBIT grew 11% to $27 million, and EBIT margins expanded 100 basis points to 29.5%.
The Process Solutions segment reported sales of $87 million in the fourth quarter, a 9% increase, and orders of $69 million, a 4% decrease. Excluding the effects of currency exchange rates and an acquisition, organic sales increased 1% and organic orders decreased 4%. The segment noted strong order activity in September and expects year-over-year order growth in the first quarter of fiscal 2009. The segment earned $12 million of EBIT in the fourth quarter of 2008, including a $1 million gain on the sale of an unused property. Excluding this gain, adjusted EBIT margins in the fourth quarter were comparable to the prior year.
The Romaco segment reported fourth quarter sales of $50 million, a 16% increase, and orders of $30 million, down 19%. Excluding the impact from currency exchange rates, organic sales increased 2% and orders declined 23%. The segment noted strong order activity in September and expects year-over-year order growth in the first quarter of fiscal 2009. Romaco achieved record EBIT of $9 million and record EBIT margins of 18.0%.
Conference Call to Be Held on October 10 at 10:00 AM (EDT)
A conference call to discuss these results has been scheduled for 10:00 AM EDT Friday, October 10, 2008, which can be accessed at www.robn.com or by dialing 800-901-5241 (US/Canada) or +1-617-786-2963, using conference ID # 16293860. Replays of the call can be accessed by dialing 888-286-8010 (U.S./Canada) or +1-617-801-6888, both using replay ID # 85108752.
About Robbins & Myers
Robbins & Myers, Inc. is a leading supplier of engineered equipment and systems for critical applications in global energy, industrial, chemical and pharmaceutical markets.
In this release the Company refers to various non-GAAP measures, including EBIT, Adjusted EBIT, EBITDA (earnings before interest, taxes, depreciation and amortization) and Adjusted EBITDA. The Company uses these measures to evaluate its performance and believes these measures are helpful to investors in assessing its performance. Reconciliations of these measures to comparable GAAP measures are provided further below in this release.
In addition to historical information, this release contains forward-looking statements identified by use of words such as "expects," "anticipates," "believes," and similar expressions. These statements reflect management's current expectations and involve known and unknown risks, uncertainties, contingencies and other factors that could cause actual results, performance or achievements to differ materially from those stated. The most significant of these risks and uncertainties are described in our Form 10-K and Form 10-Q reports filed with the Securities and Exchange Commission and include, but are not limited to: a significant decline in capital expenditures in the specialty chemical and pharmaceutical industries; a major decline in oil and natural gas prices; foreign exchange rate fluctuations; work stoppages related to union negotiations; customer order cancellations; business disruptions caused by the implementation of business computer systems; the possibility of product liability suits that could hurt our business; events or circumstances which result in an impairment of assets; the potential impact of U.S. and foreign legislation, government regulations, and other governmental action, including those relating to export and import of products and materials, and changes in the interpretation and application of such laws and regulations; the outcome of audit, compliance, administrative or investigatory reviews; and general economic conditions that can affect demand in the process industries. Except as otherwise required by law, we do not undertake any obligation to publicly update or revise these forward-looking statements to reflect events or circumstances after the date hereof.
ROBBINS & MYERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
(in thousands) August 31, 2008 August 31, 2007
ASSETS
Current Assets:
Cash and cash equivalents $123,405 $116,110
Accounts receivable 153,648 152,779
Inventories 109,797 99,196
Other current assets 8,017 7,410
Deferred taxes 13,476 11,178
Total Current Assets 408,343 386,673
Goodwill & Other Intangible Assets 285,759 278,422
Deferred Taxes 21,969 9,583
Other Assets 10,931 12,196
Property, Plant & Equipment 137,715 129,269
$864,717 $816,143
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $86,012 $78,890
Accrued expenses 102,876 105,394
Current portion of long-term debt 3,192 72,522
Total Current Liabilities 192,080 256,806
Long-Term Debt - Less Current Portion 30,435 30,553
Deferred Taxes 44,628 24,818
Other Long-Term Liabilities 97,557 91,448
Shareholders' Equity 500,017 412,518
$864,717 $816,143
ROBBINS & MYERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED INCOME STATEMENT
(Unaudited)
Three Months Ended Twelve Months Ended
August 31, August 31, August 31, August 31,
(in thousands, except 2008 2007 2008 2007
per share data)
Sales $227,754 $207,034 $787,168 $695,393
Cost of sales 143,413 134,820 496,906 453,052
Gross profit 84,341 72,214 290,262 242,341
SG&A expenses 44,114 37,192 167,229 151,520
Other income (835) (1,303) (7,631) (3,461)
Income before interest
and income taxes 41,062 36,325 130,664 94,282
Interest expense, net 268 893 2,031 5,243
Income before income taxes and
minority interest 40,794 35,432 128,633 89,039
Income tax expense 9,812 15,963 39,099 36,866
Minority interest 350 557 2,132 1,468
Net income $30,632 $18,912 $87,402 $50,705
Net Income Per Share:
Basic $0.88 $0.55 $2.53 $1.49
Diluted $0.88 $0.55 $2.52 $1.48
Weighted Average Common Shares
Outstanding:
Basic 34,685 34,242 34,524 34,050
Diluted 34,836 34,384 34,718 34,212
ROBBINS & MYERS, INC. AND SUBSIDIARIES
CONDENSED BUSINESS SEGMENT INFORMATION
(Unaudited)
Three Months Ended Twelve Months Ended
August 31, August 31, August 31, August 31,
(in thousands) 2008 2007 2008 2007
Sales
Fluid Management $90,499 $84,047 $322,868 $292,283
Process Solutions 87,021 79,579 313,604 273,890
Romaco 50,234 43,408 150,696 129,220
Total $227,754 $207,034 $787,168 $695,393
Income Before Interest and
Income Taxes (EBIT)
Fluid Management $26,671 $23,963 $91,319 $76,973
Process Solutions 11,956 10,528 37,570 31,941
Romaco 9,046 6,721 20,603 2,612
Corporate and Eliminations (6,611) (4,887) (18,828) (17,244)
Total $41,062 $36,325 $130,664 $94,282
Depreciation and Amortization
Fluid Management $1,970 $2,260 $6,993 $7,376
Process Solutions 1,595 1,369 6,753 6,224
Romaco 491 583 1,869 2,090
Corporate and Eliminations 131 252 634 934
Total $4,187 $4,464 $16,249 $16,624
Orders
Fluid Management $99,174 $80,406 $343,079 $301,941
Process Solutions 68,872 71,402 324,542 284,371
Romaco 29,754 36,896 145,377 133,536
Total $197,800 $188,704 $812,998 $719,848
Backlog
Fluid Management $63,168 $42,956 $63,168 $42,956
Process Solutions 123,529 98,914 123,529 98,914
Romaco 51,283 51,951 51,283 51,951
Total $237,980 $193,821 $237,980 $193,821
These results include income and expense relating to special items that
are described in greater detail in the accompanying "Reconciliation of
Net Income to the Non-GAAP Measures of EBIT, EBITDA, Adjusted EBIT and
Adjusted EBITDA".
ROBBINS & MYERS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
Three Months Ended Twelve Months Ended
August 31, August 31, August 31, August 31,
(in thousands) 2008 2007 2008 2007
Operating activities:
Net income $30,632 $18,912 $87,402 $50,705
Depreciation and
amortization 4,187 4,464 16,249 16,624
Other, net 5,985 32,790 (14,091) (2,216)
Cash provided by operating
activities 40,804 56,166 89,560 65,113
Investing activities:
Capital expenditures,
net of nominal disposals (9,331) (5,109) (22,114) (16,536)
Proceeds from sales of
product line/facilities 1,291 2,330 8,484 13,712
Acquisition of business,
net of cash acquired 0 0 (5,061) 0
Cash used by investing
activities (8,040) (2,779) (18,691) (2,824)
Financing activities:
Proceeds (Payments) of
long-term debt, net 667 (585) (69,448) (2,456)
Other, net 344 682 3,576 6,663
Cash provided (used) by
financing activities 1,011 97 (65,872) 4,207
Exchange rate impact on cash (2,114) 167 2,298 1,249
Increase in cash 31,661 53,651 7,295 67,745
Cash at beginning of period 91,744 62,459 116,110 48,365
Cash at end of period $123,405 $116,110 $123,405 $116,110
ROBBINS & MYERS, INC. AND SUBSIDIARIES
RECONCILIATION OF NET INCOME TO THE NON-GAAP MEASURES OF EBIT, EBITDA,
ADJUSTED EBIT AND ADJUSTED EBITDA
(Unaudited)
Three Months Ended Twelve Months Ended
August 31, August 31, August 31, August 31,
(dollar amounts in thousands) 2008 2007 2008 2007
Net income $30,632 $18,912 $87,402 $50,705
Interest expense, net 268 893 2,031 5,243
Income taxes 9,812 15,963 39,099 36,866
Minority interest 350 557 2,132 1,468
EBIT 41,062 36,325 130,664 94,282
Minority interest (350) (557) (2,132) (1,468)
Depreciation & amortization 4,187 4,464 16,249 16,624
EBITDA 44,899 40,232 144,781 109,438
Special items:
(1) Process Solutions segment
Net product line/facility
sale gains (835) - (835) (5,036)
(835) - (835) (5,036)
(2) Romaco segment
Restructuring costs - - - 1,818
Net product line/facility
sale gains - (1,303) (6,796) (243)
- (1,303) (6,796) 1,575
Total Special Items (835) (1,303) (7,631) (3,461)
Adjusted EBIT $40,227 $35,022 $123,033 $90,821
Adjusted EBIT margin 17.7% 16.9% 15.6% 13.1%
Adjusted EBITDA $44,064 $38,929 $137,150 $105,977
Note: EBIT, adjusted EBIT, adjusted EBIT margin, and adjusted EBITDA are
non-GAAP measures. We use these measures to evaluate our businesses, and
we allocate resources to our businesses based on EBIT. EBIT is not,
however, a measure of performance calculated in accordance with accounting
principles generally accepted in the United States and should not be
considered as an alternative to net income as a measure of operating
results. Neither EBIT nor EBITDA are measures of cash available for use
by management.
SOURCE Robbins & Myers, Inc.
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