Lydall (LDL) Tops Q2 EPS by 7c, Slight Miss on Revenues

Lydall (NYSE: LDL) reported Q2 EPS of $0.80, $0.07 better than the analyst estimate of $0.73. Revenue for the quarter came in at $174.9 million versus the consensus estimate of $174.98 million.

GAAP Financials

• Net sales of $174.9 million, up 27.4% from $137.2 million - Technical Nonwovens' acquisitions contributed $33.0 million, or 24.0%
• Gross margin of 24.7%, down 150 basis points
• Operating margin of 11.3%, flat with Q2 2016 - Includes 50 basis points of incremental intangibles amortization from acquisitions
• Earnings per share ("EPS") of $0.76, up 20.6%, from $0.63

Non-GAAP Financial Measures*

• Organic sales growth of 6.4%
• Adjusted gross margin of 25.1%, down 110 basis points
• Adjusted operating margin of 11.8%, down 60 basis points
• Adjusted EPS of $0.80, up 14.3%, from adjusted $0.70 per share
• Adjusted EBITDA margin of 15.1%, down 80 basis points

Outlook

Mr. Barnhart concluded, “Looking forward to the third quarter of 2017, demand is generally stable in our markets across all segments, and we expect to deliver marginal organic growth. From a gross margin perspective, mix, including increased low margin tooling sales in advance of new automotive platform launches later in 2017, and select commodity pricing pressures in our Thermal/Acoustical Metals segment are expected to reduce the Company's gross margin. We continue to actively implement productivity initiatives and the corrective actions needed to realize further operating improvement in the Thermal/Acoustical Metals segment. Lastly, we remain on track with integrating the Texel and Gutsche businesses, and are now moving into the execution phase of the previously disclosed restructuring plan that is expected to reduce operating costs and increase efficiency, in total delivering $5.0 million of run-rate profit improvement by 2019 and important enhancements to the Company’s flexibility and competitive position."

For earnings history and earnings-related data on Lydall (LDL) click here.

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