ATU
$28.97
Actuant
($.08)
(.28%)
Earnings Details
3rd Quarter May 2018
Wednesday, June 20, 2018 8:30:00 AM
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Summary

Actuant Beats

Actuant (ATU) reported 3rd Quarter May 2018 earnings of $0.39 per share on revenue of $317.1 million. The consensus earnings estimate was $0.36 per share on revenue of $305.9 million. The Earnings Whisper number was $0.37 per share. Revenue grew 7.3% on a year-over-year basis.

The company said it expects fourth quarter earnings of $0.32 to $0.37 per share on revenue of $290.0 million to $300.0 million. The current consensus earnings estimate is $0.36 per share on revenue of $280.1 million for the quarter ending August 31, 2018.

Actuant Corp is a diversified company that designs, manufactures and distributes a broad industrial products and systems to various end markets. The Company is organized into three operating segments as follows: Industrial, Energy & Engineered Solutions.

Results
Reported Earnings
$0.39
Earnings Whisper
$0.37
Consensus Estimate
$0.36
Reported Revenue
$317.1 Mil
Revenue Estimate
$305.9 Mil
Growth
Earnings Growth
Revenue Growth
Guidance
Power Rating
Grade
Earnings Release

Actuant Reports Third Quarter Results; Updates Fiscal 2018 Guidance

MILWAUKEE--(BUSINESS WIRE)-- Actuant Corporation (NYSE: ATU) today announced results for its third quarter ended May 31, 2018.

Highlights

  • Consolidated sales increased 7% over the comparable prior year quarter with a 4% benefit from foreign currency rate changes and a 1% reduction associated with net acquisitions and divestitures. Third quarter core sales (total sales excluding the impact of acquisitions, divestitures and foreign currency rate changes) increased 4% on a year-over-year basis with strong volumes in both the Engineered Solutions and Industrial segments.
  • GAAP diluted earnings per share (“EPS”) was $0.48 in the third quarter of fiscal 2018 versus $0.37 in the prior year. Excluding third quarter fiscal 2018 one-time items, adjusted EPS was $0.39 (see Consolidated Results below, along with the attached reconciliation of earnings).
  • Strong operating cash flow generation and reduction in net leverage improves capital allocation liquidity.
  • Acquired Equalizer, a small tool product line tuck-in to expand pipe and flange alignment capabilities.
  • Full year fiscal 2018 sales and adjusted EPS guidance updated to $1.17-1.18 billion and $1.03-1.08 (excluding one-time items), respectively.

Randy Baker, President and CEO of Actuant commented, “I’m pleased with Actuant’s performance in the third quarter, delivering both solid sales and earnings growth. We continue to see strong momentum in the industrial tools and OEM component businesses, and global Energy maintenance activity appears to have stabilized. While we continue to experience some pressures from inflation along with commercial and engineering investments to support high service levels and growth, we are realizing the incremental margin benefits of higher volumes and restructuring actions. In summary, I am encouraged by this quarter’s performance and our team’s ability to capitalize on the broad based strong economic backdrop. I want to thank our employees across the globe for their continued commitment and execution.”

Consolidated Results

Consolidated sales for the third quarter were $317 million, 7% higher than the $295 million in the comparable prior year quarter. Core sales improved 4% year-over-year while foreign currency rate changes increased sales 4% and the net impact from the Mirage acquisition net of the Viking divestiture reduced sales by 1%. Fiscal 2018 third quarter net earnings and EPS were $29.0 million, or $0.48, compared to $22.5 million, or $0.37, respectively, in the comparable prior year quarter. Fiscal 2018 third quarter earnings included restructuring charges of $1.2 million (benefit of $0.2 million and zero EPS, after tax) and a $4.9 million ($0.09 per share) benefit related to an adjustment to the original provision for U.S. tax reform based on further IRS clarification. (Note that impacts from tax reform remain provisional and subject to further adjustment.) Third quarter 2017 results included $0.4 million ($0.2 million and zero EPS, after tax) of restructuring charges and a $3.2 million income tax benefit ($0.05 per share). Excluding these items, adjusted EPS for the third quarter of fiscal 2018 was $0.39 compared to $0.32 in the comparable prior year period (see attached reconciliation of earnings).

Consolidated sales for the nine months ended May 31, 2018 were $881 million, 7% higher than the $820 million in the comparable prior year period. Core sales improved 5% year-over-year while foreign currency rate changes increased sales 3%, and the net impact of acquisitions and divestitures reduced sales by 1%. Fiscal 2018’s year-to-date net earnings and EPS were $16.0 million, or $0.26, compared to earnings and EPS of $32.6 million, and $0.54, respectively, in the comparable prior year period. Fiscal 2018 year-to-date results include restructuring charges of $12.1 million ($9.8 million or $0.16 per share, after tax) along with impairment & divestiture, tax reform and equity compensation items. Fiscal 2017 comparable results included $5.4 million ($4.0 million or $0.07 per share, after tax) of restructuring charges along with director and officer transition charges and an income tax benefit. Excluding these items, adjusted EPS for the first nine months of fiscal 2018 was $0.71 compared to $0.64 in the comparable prior year period (see attached reconciliation of earnings).

Segment Results

Industrial Segment

(US $ in millions)

   
       
Three Months Ended May 31, Nine Months Ended May 31,
2018   2017 2018   2017
Sales $108.3 $100.5 $304.3 $279.4
Operating Profit $26.0 $23.7 $61.0 $60.8
Adjusted Op Profit (1) $25.8 $24.0 $63.8 $62.5
Adjusted Op Profit % (1) 23.9% 23.9% 21.0% 22.4%

(1) 2018 excludes $(0.2) and $2.8 of restructuring charges in the third quarter and nine months, respectively. 2017 excludes $0.3 and $1.7 of restructuring charges in the third quarter and nine months, respectively.

Third quarter fiscal 2018 Industrial segment sales were $108 million, or 8% higher than the prior year. The impact of foreign currency exchange rates was a 4% benefit resulting in a 4% year-over-year core sales increase. Sales of standard industrial tools remained strong, growing double digits on a global basis with broad demand across the diverse set of end markets served despite tougher comparables. The segment’s overall core sales growth rate includes significantly lower heavy lifting technology sales and a modest decline in concrete tensioning volumes. Third quarter adjusted operating profit margin was level with the prior year and improved 520 basis points sequentially. Strong incremental profits within the industrial tool channel were partially offset by continued costs associated with heavy lifting specialty projects and concrete tensioning production inefficiencies, although less severe than prior quarters.

 

Energy Segment

(US $ in millions)

           
Three Months Ended May 31, Nine Months Ended May 31,
2018   2017 2018   2017
Sales $83.9 $83.5 $225.7 $241.0
Operating Profit $6.2 $0.9 $2.0 $3.6
Adjusted Op Profit (2) $7.0 $0.9 $9.0 $3.6
Adjusted Op Profit % (2) 8.4% 1.1% 4.0% 1.5%

(2) 2018 excludes $0.8 and $4.0 of restructuring charges in the third quarter and nine months, respectively. 2018 nine month results also exclude $3.0 in impairment & divestiture charges.

Fiscal 2018 third quarter Energy segment sales were approximately level with the prior year at $84 million. The 3% favorable impact of the weaker US dollar was offset by the 2% headwind from the net of the Viking divestiture and Mirage acquisition, while core sales declined 1%. Hydratight’s global maintenance activity levels stabilized, with improvements in the Middle East and North Sea offset by declines in certain other regions. Cortland sales grew slightly on higher medical product demand along with improving offshore oil & gas seismic and cable activity. Energy segment adjusted operating profit margin improved substantially both year-over-year and sequentially due to the benefits of restructuring and service excellence actions, favorable sales mix, and the absence of Viking losses.

           

Engineered Solutions Segment

(US $ in millions)

 
Three Months Ended May 31, Nine Months Ended May 31,
2018   2017 2018   2017
Sales $124.9 $111.4 $351.2 $299.6
Operating Profit $9.0 $8.1 $17.6 $10.7
Adjusted Op Profit (3) $9.0 $8.2 $18.1 $14.3
Adjusted Op Profit % (3) 7.2% 7.3% 5.1% 4.8%

(3) 2018 excludes $0.5 of restructuring charges for the nine months. 2017 excludes $0.1 and $3.6 of restructuring charges in the third quarter and nine months, respectively.

Third quarter fiscal 2018 Engineered Solutions segment sales were $125 million or 12% above the prior year. Excluding the 5% benefit of the weaker US dollar, year-over-year core sales increased 7%. Strong sales growth continued across the agriculture and other off-highway equipment markets globally, while truck sales were modestly higher as growth in Europe production was partially offset by anticipated lower China volumes. Third quarter adjusted operating profit margin was about level with the comparable prior year quarter as the higher volumes were offset by higher engineering expenses to support growth, material and labor inflation and unfavorable mix.

Corporate Expenses and Income Taxes (excluding restructuring, transition, and one-time tax items)

Corporate expenses for the third quarter of fiscal 2018 were $8.1 million, or $2.7 million greater than the comparable prior year period due primarily to higher incentive compensation and outside services costs. The effective income tax rate of approximately 9% was modestly above expectations and higher than the prior year’s -4% rate.

Financial Position

Net debt at May 31, 2018 was approximately $351 million (total debt of $540 million less $189 million of cash) which declined approximately $43 million from the prior quarter end. Strong cash flow was used to reduce net debt and the Company deployed approximately $6 million on a small tool product line acquisition. The net debt to proforma EBITDA leverage ratio declined to 2.6 times.

Outlook

Baker continued, "I believe our third quarter results demonstrate that we are on the path toward higher structural sales and margin performance, and we expect to further build on these solid results. This underlying performance, combined with anticipated improvement in energy maintenance activity levels, effectively managing the inflationary environment and our expected continued progress in new product launches, we believe positions us well to deliver on our 2018 full year guidance.

With one quarter to go in the fiscal year, we are increasing our full year sales guidance and narrowing our adjusted EPS guidance range to reflect our performance to date and the latest outlook for the remainder of the year. For the fourth quarter, we anticipate sales will be in the $290-300 million range reflecting normal seasonal moderation from the third quarter. Fourth quarter adjusted EPS is expected to be in the range of $0.32-0.37. This includes core sales growth of approximately 3-5% and a mid-single digit effective income tax rate. This would bring our full year sales and adjusted EPS guidance to a range of $1.17-1.18 billion and $1.03-1.08, respectively. Free cash flow is expected to be in the $70-75 million range and would represent greater than 100% earnings conversion.”

All guidance excludes restructuring, divestiture & impairment charges, one-time tax adjustments as well as the impact of potential future acquisitions, dispositions and share repurchases.

Baker concluded, “The global economy and our markets continue to show strength, and our growth initiatives are taking hold. By working to improve our commercial effectiveness and speed to market, enhance our lean execution and complete critical portfolio management actions, we believe we will be well positioned to drive significant long-term value for our customers, employees and shareholders.”

Conference Call Information

An investor conference call is scheduled for 10am CT today, June 20, 2018. Webcast information and conference call materials will be made available on the Actuant company website (www.actuant.com) prior to the start of the call.

Safe Harbor Statement

Certain of the above comments represent forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. Management cautions that these statements are based on current estimates of future performance and are highly dependent upon a variety of factors, which could cause actual results to differ from these estimates. Actuant’s results are also subject to general economic conditions, variation in demand from customers, the impact of geopolitical activity on the economy, continued market acceptance of the Company’s new product introductions, the successful integration of acquisitions, restructuring, operating margin risk due to competitive pricing and operating efficiencies, supply chain risk, material and labor cost increases, tax reform, foreign currency fluctuations and interest rate risk. See the Company’s Form 10-K filed with the Securities and Exchange Commission for further information regarding risk factors. Actuant disclaims any obligation to publicly update or revise any forward-looking statements as a result of new information, future events or any other reason.

About Actuant Corporation

Actuant Corporation is a diversified industrial company serving customers from operations in more than 30 countries. The Actuant businesses are leaders in a broad array of niche markets including branded hydraulic tools and solutions; specialized products and services for energy markets and highly engineered position and motion control systems. The Company was founded in 1910 and is headquartered in Menomonee Falls, Wisconsin. Actuant trades on the NYSE under the symbol ATU. For further information on Actuant and its businesses, visit the Company's website at www.actuant.com.

(tables follow)

 
 
Actuant Corporation
Condensed Consolidated Balance Sheets
(Dollars in thousands)
(Unaudited)
             
May 31, August 31,
2018 2017
 
ASSETS
Current assets
Cash and cash equivalents $ 189,490 $ 229,571
Accounts receivable, net 212,284 190,206
Inventories, net 167,317 143,651
Assets held for sale - 21,835
Other current assets   58,732     61,663  
Total current assets 627,823 646,926
 
Property, plant and equipment, net 100,765 94,521
Goodwill 538,792 530,081
Other intangible assets, net 210,160 220,489
Other long-term assets   27,245     24,938  
 
Total assets $ 1,504,785   $ 1,516,955  
 
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Trade accounts payable $ 142,199 $ 133,387
Accrued compensation and benefits 48,093 50,939
Current maturities of debt and short-term borrowings 30,000 30,000
Income taxes payable 17,605 6,080
Liabilities held for sale - 101,083
Other current liabilities   63,437     57,445  
Total current liabilities 301,334 378,934
 
Long-term debt, net 510,007 531,940
Deferred income taxes 19,491 29,859
Pension and postretirement benefit liabilities 18,692 19,862
Other long-term liabilities   54,233     55,821  
Total liabilities 903,757 1,016,416
 
Shareholders' equity
Capital stock 16,227 16,040
Additional paid-in capital 159,653 138,449
Treasury stock (617,731 ) (617,731 )
Retained earnings 1,207,059 1,191,042
Accumulated other comprehensive loss (164,180 ) (227,261 )
Stock held in trust (2,594 ) (2,696 )
Deferred compensation liability   2,594     2,696  
Total shareholders' equity   601,028     500,539  
 
Total liabilities and shareholders' equity $ 1,504,785   $ 1,516,955  

 
 
Actuant Corporation
Condensed Consolidated Statements of Earnings
(Dollars in thousands, except per share amounts)
(Unaudited)
               
 
Three Months Ended Nine Months Ended
May 31, May 31, May 31, May 31,
2018   2017 2018   2017
 
Net sales $ 317,096 $ 295,427 $ 881,216 $ 820,089
Cost of products sold   200,587       192,623     574,100     536,892  
Gross profit 116,509 102,804 307,116 283,197
 
Selling, administrative and engineering expenses 77,570 70,051 220,550 205,609
Amortization of intangible assets 5,184 5,037 15,483 15,368
Director & officer transition charges - - - 7,784
Restructuring charges 1,170 384 11,249 5,433
Impairment & divestiture charges   -       -     2,987     -  
Operating profit 32,585 27,332 56,847 49,003
 
Financing costs, net 7,756 7,553 22,874 22,019
Other (income) expense, net   (188 )     1,297     508     1,260  
Earnings before income tax (benefit) expense 25,017 18,482 33,465 25,724
 
Income tax (benefit) expense   (3,995 )     (4,029 )   17,448     (6,827 )
Net earnings $ 29,012     $ 22,511   $ 16,017   $ 32,551  
 
Earnings per share
Basic $ 0.48 $ 0.38 $ 0.27 $ 0.55
Diluted 0.48 0.37 0.26 0.54
 
Weighted average common shares outstanding
Basic 60,683 59,675 60,291 59,339
Diluted 61,064 60,402 60,850 60,055

 
 
Actuant Corporation
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
           
 
Three Months Ended Nine Months Ended
May 31, May 31, May 31, May 31,
2018 2017 2018 2017
 
Operating Activities
Net earnings $ 29,012 $ 22,511 $ 16,017 $ 32,551
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Impairment & other divestiture charges, including tax expense - - 12,385 -
Depreciation and amortization 10,415 10,637 30,800 32,262
Stock-based compensation expense 3,659 2,675 11,951 14,852
(Benefit) expense for deferred income taxes (3,455 ) 813 (10,579 ) 1,364
Amortization of debt issuance costs 413 418 1,239 1,244
Other non-cash adjustments 147 308 347 1,023
Changes in components of working capital and other:
Accounts receivable (4,584 ) (1,721 ) (21,456 ) (22,618 )
Inventories (4,157 ) 75 (22,590 ) (319 )
Trade accounts payable 6,915 1,181 5,162 13,457
Prepaid expenses and other assets (4,524 ) 3,707 (13,692 ) (7,112 )
Income tax accounts 8,484 (12,355 ) 25,989 (19,273 )
Accrued compensation and benefits 7,778 7,473 (2,181 ) 3,769
Other accrued liabilities   7,592     1,658     2,197     862  
Cash provided by operating activities 57,695 37,380 35,589 52,062
 
Investing Activities
Capital expenditures (6,169 ) (8,224 ) (18,716 ) (22,919 )
Proceeds from sale of property, plant and equipment 35 - 148 244
Rental asset buyout for Viking divestiture - - (27,718 ) -
Proceeds from sale of business, net of transaction costs - - 8,780 -
Cash paid for business acquisitions, net of cash acquired   (5,809 )   -     (22,326 )   -  
Cash used in investing activities (11,943 ) (8,224 ) (59,832 ) (22,675 )
 
Financing Activities
Principal repayments on term loan (7,500 ) (3,750 ) (22,500 ) (11,250 )
Stock option excercises & other 130 1,365 10,435 7,314
Redemption of 5.625% senior notes - (500 ) - (500 )
Taxes paid related to the net share settlement of equity awards (172 ) (79 ) (1,279 ) (999 )
Payment of deferred acquisition consideration - (742 ) - (742 )
Cash dividend   -     -     (2,390 )   (2,358 )
Cash used in financing activities (7,542 ) (3,706 ) (15,734 ) (8,535 )
 
Effect of exchange rate changes on cash   (2,315 )   1,614     (104 )   (1,502 )
Net increase (decrease) in cash and cash equivalents 35,895 27,064 (40,081 ) 19,350
Cash and cash equivalents - beginning of period   153,595     171,890     229,571     179,604  
Cash and cash equivalents - end of period $ 189,490   $ 198,954   $ 189,490   $ 198,954  

 
 
ACTUANT CORPORATION
SUPPLEMENTAL UNAUDITED DATA
(Dollars in thousands)
                       
FISCAL 2017 FISCAL 2018
Q1   Q2   Q3   Q4   TOTAL Q1   Q2   Q3   Q4   TOTAL
SALES
INDUSTRIAL SEGMENT $ 87,290 $ 91,648 $ 100,503 $ 100,315 $ 379,756 $ 96,916 $ 99,081 $ 108,297 $ - $ 304,294
ENERGY SEGMENT 84,646 72,884 83,480 68,584 309,594 75,841 65,992 83,857 - 225,690
ENGINEERED SOLUTIONS SEGMENT   93,857       94,337       111,444       106,796       406,434     116,198       110,092       124,942       -     351,232  
TOTAL $ 265,793     $ 258,869     $ 295,427     $ 275,695     $ 1,095,784   $ 288,955     $ 275,165     $ 317,096     $ -   $ 881,216  
 
% SALES GROWTH
INDUSTRIAL SEGMENT -2 % 13 % 5 % 7 % 6 % 11 % 8 % 8 % - 9 %
ENERGY SEGMENT -26 % -15 % -18 % -25 % -21 % -10 % -9 % 0 % - -6 %
ENGINEERED SOLUTIONS SEGMENT -8 % -2 % 3 % 18 % 2 % 24 % 17 % 12 % - 17 %
TOTAL -13 % -2 % -3 % 0 % -5 % 9 % 6 % 7 % - 7 %
 
OPERATING PROFIT (LOSS)
INDUSTRIAL SEGMENT $ 19,491 $ 19,037 $ 24,019 $ 24,076 $ 86,623 $ 19,482 $ 18,493 $ 25,845 $ - $ 63,820
ENERGY SEGMENT 3,328 (647 ) 895 (3,675 ) (99 ) 1,224 747 7,033 - 9,004
ENGINEERED SOLUTIONS SEGMENT 2,834 3,282 8,174 6,069 20,359 6,618 2,409 9,038 - 18,065
CORPORATE / GENERAL   (6,450 )     (6,372 )     (5,372 )     (6,935 )     (25,128 )   (6,022 )     (4,789 )     (8,145 )     -     (18,956 )
ADJUSTED OPERATING PROFIT $ 19,203 $ 15,300 $ 27,716 $ 19,535 $ 81,755 $ 21,302 $ 16,860 $ 33,771 $ - $ 71,933
IMPAIRMENT & DIVESTITURE CHARGES - - - (116,979 ) (116,979 ) - (2,987 ) - - (2,987 )
RESTRUCTURING CHARGES (1) (2,948 ) (2,101 ) (384 ) (1,795 ) (7,228 ) (6,629 ) (4,284 ) (1,186 ) - (12,099 )
DIRECTOR & OFFICER TRANSITION CHARGES   (7,784 )     -       -       -       (7,784 )   -       -       -       -     -  
OPERATING PROFIT (LOSS) $ 8,471     $ 13,199     $ 27,332     $ (99,239 )   $ (50,236 ) $ 14,673     $ 9,589     $ 32,585     $ -   $ 56,847  
 
ADJUSTED OPERATING PROFIT %
INDUSTRIAL SEGMENT 22.3 % 20.8 % 23.9 % 24.0 % 22.8 % 20.1 % 18.7 % 23.9 % - 21.0 %
ENERGY SEGMENT 3.9 % -0.9 % 1.1 % -5.4 % 0.0 % 1.6 % 1.1 % 8.4 % - 4.0 %
ENGINEERED SOLUTIONS SEGMENT 3.0 % 3.5 % 7.3 % 5.7 % 5.0 % 5.7 % 2.2 % 7.2 % - 5.1 %
ADJUSTED OPERATING PROFIT % 7.2 % 5.9 % 9.4 % 7.1 % 7.5 % 7.4 % 6.1 % 10.7 % - 8.2 %
 
EBITDA
INDUSTRIAL SEGMENT $ 21,217 $ 21,064 $ 25,575 $ 25,851 $ 93,707 $ 21,202 $ 21,034 $ 27,823 $ - $ 70,059
ENERGY SEGMENT 9,108 2,943 4,633 142 16,826 5,125 4,533 11,554 - 21,212
ENGINEERED SOLUTIONS SEGMENT 6,281 7,277 11,716 9,533 34,807 10,254 6,020 12,566 - 28,840
CORPORATE / GENERAL   (5,879 )     (5,846 )     (4,868 )     (6,637 )     (23,230 )   (5,518 )     (4,799 )     (7,569 )     -     (17,886 )
ADJUSTED EBITDA $ 30,727 $ 25,438 $ 37,056 $ 28,889 $ 122,110 $ 31,063 $ 26,788 $ 44,374 $ - $ 102,225
IMPAIRMENT & DIVESTITURE CHARGES - - - (116,979 ) (116,979 ) - (2,987 ) - - (2,987 )
RESTRUCTURING CHARGES (1) (2,948 ) (2,101 ) (384 ) (1,795 ) (7,228 ) (6,629 ) (4,284 ) (1,186 ) - (12,099 )
DIRECTOR & OFFICER TRANSITION CHARGES   (7,784 )     -       -       -       (7,784 )   -       -       -       -     -  
EBITDA $ 19,995     $ 23,337     $ 36,672     $ (89,885 )   $ (9,881 ) $ 24,434     $ 19,517     $ 43,188     $ -   $ 87,139  
 
ADJUSTED EBITDA %
INDUSTRIAL SEGMENT 24.3 % 23.0 % 25.4 % 25.8 % 24.7 % 21.9 % 21.2 % 25.7 % - 23.0 %
ENERGY SEGMENT 10.8 % 4.0 % 5.5 % 0.2 % 5.4 % 6.8 % 6.9 % 13.8 % - 9.4 %
ENGINEERED SOLUTIONS SEGMENT 6.7 % 7.7 % 10.5 % 8.9 % 8.6 % 8.8 % 5.5 % 10.1 % - 8.2 %
ADJUSTED EBITDA % 11.6 % 9.8 % 12.5 % 10.5 % 11.1 % 10.8 % 9.7 % 14.0 % - 11.6 %
 
Note: (1) Approximately $0.8 million of the Q2 fiscal 2018 restructuring charges were recorded in cost of products sold. De minimis restructuring charges were also recorded in cost of products sold in Q3 fiscal 2018.

 
 
ACTUANT CORPORATION
SUPPLEMENTAL UNAUDITED DATA
RECONCILIATION OF GAAP MEASURES TO NON-GAAP MEASURES
  (Dollars in thousands, except for per share amounts)  
 
 
FISCAL 2017 FISCAL 2018
Q1 Q2 Q3 Q4 TOTAL Q1 Q2 Q3 Q4 TOTAL
ADJUSTED EARNINGS (1)
NET EARNINGS (LOSS) (GAAP MEASURE) $ 4,965 $ 5,074 $ 22,511 $ (98,764 ) $ (66,213 ) $ 5,226 $ (18,221 ) $ 29,012 $ - $ 16,017
IMPAIRMENT & DIVESTITURE CHARGES - - - 116,979 116,979 - 2,987 - - 2,987
INCOME TAX (BENEFIT) EXPENSE ON IMPAIRMENT & DIVESTITURE CHARGES - - - (8,119 ) (8,119 ) - 9,398 - - 9,398
DIRECTOR & OFFICER TRANSITION CHARGES 7,784 - - - 7,784 - - - - -
INCOME TAX BENEFIT ON DIRECTOR & OFFICER TRANSITION CHARGES (2,880 ) - - - (2,880 ) - - - - -
RESTRUCTURING CHARGES (1) 2,948 2,101 384 1,795 7,228 6,629 4,284 1,186 - 12,099
INCOME TAX BENEFIT ON RESTRUCTURING CHARGES (777 ) (564 ) (124 ) (494 ) (1,959 ) (375 ) (500 ) (1,435 ) - (2,310 )
INCOME TAX EXPENSE (BENEFIT) FROM U.S. TAX REFORM - - - - - - 8,367 (4,891 ) - 3,476
INCOME TAX EXPENSE FROM EQUITY VESTING/EXERCISES - - - - - - 1,338 - - 1,338
OTHER INCOME TAX BENEFIT   -     -     (3,193 )   -     (3,193 )   -     -     -     -   -  
ADJUSTED EARNINGS $ 12,040   $ 6,611   $ 19,578   $ 11,397   $ 49,627   $ 11,480   $ 7,653   $ 23,872   $ - $ 43,005  
 
ADJUSTED DILUTED EARNINGS PER SHARE (2)
NET EARNINGS (LOSS) (GAAP MEASURE) $ 0.08 $ 0.08 $ 0.37 $ (1.65 ) $ (1.11 ) $ 0.09 $ (0.30 ) $ 0.48 $ - $ 0.26
IMPAIRMENT & DIVESTITURE CHARGES - - - 1.96 1.96 - 0.05 - - 0.05
INCOME TAX (BENEFIT) EXPENSE ON IMPAIRMENT & DIVESTITURE CHARGES - - - (0.14 ) (0.14 ) - 0.16 - - 0.16
DIRECTOR & OFFICER TRANSITION CHARGES 0.13 - - - 0.13 - - - - -
INCOME TAX BENEFIT ON DIRECTOR & OFFICER TRANSITION CHARGES (0.05 ) - - - (0.05 ) - - - - -
RESTRUCTURING CHARGES (1) 0.05 0.04 0.01 0.03 0.12 0.11 0.07 0.02 - 0.20
INCOME TAX BENEFIT ON RESTRUCTURING CHARGES (0.01 ) (0.01 ) (0.01 ) (0.01 ) (0.03 ) (0.01 ) (0.01 ) (0.02 ) - (0.04 )
INCOME TAX EXPENSE (BENEFIT) FROM U.S. TAX REFORM - - - - - - 0.14 (0.09 ) - 0.06
INCOME TAX EXPENSE FROM EQUITY VESTING/EXERCISES - - - - - - 0.02 - - 0.02
OTHER INCOME TAX BENEFIT   -     -     (0.05 )   -     (0.05 )   -     -     -     -   -  
ADJUSTED DILUTED EARNINGS PER SHARE $ 0.20   $ 0.11   $ 0.32   $ 0.19   $ 0.83   $ 0.19   $ 0.13   $ 0.39   $ - $ 0.71  
 
ADJUSTED EBITDA (3)
NET EARNINGS (LOSS) (GAAP MEASURE) $ 4,965 $ 5,074 $ 22,511 $ (98,764 ) $ (66,213 ) $ 5,226 $ (18,221 ) $ 29,012 $ - $ 16,017
FINANCING COSTS, NET 7,132 7,334 7,553 7,683 29,703 7,514 7,604 7,756 - 22,874
INCOME TAX (BENEFIT) EXPENSE (2,998 ) 200 (4,029 ) (9,651 ) (16,478 ) 1,604 19,839 (3,995 ) - 17,448
DEPRECIATION & AMORTIZATION   10,896     10,729     10,637     10,847     43,108     10,090     10,295     10,415     -   30,800  
EBITDA $ 19,995 $ 23,337 $ 36,672 $ (89,885 ) $ (9,881 ) $ 24,434 $ 19,517 $ 43,188 $ - $ 87,139
IMPAIRMENT & OTHER DIVESTITURE CHARGES - - - 116,979 116,979 - 2,987 - - 2,987
DIRECTOR & OFFICER TRANSITION CHARGES 7,784 - - - 7,784 - - - - -
RESTRUCTURING CHARGES   2,948     2,101     384     1,795     7,228     6,629     4,284     1,186     -   12,099  
ADJUSTED EBITDA $ 30,727   $ 25,438   $ 37,056   $ 28,889   $ 122,110   $ 31,063   $ 26,788   $ 44,374   $ - $ 102,225  
 
FOOTNOTES
NOTE: The total of the individual quarters may not equal the annual total due to rounding.
 
(1) Approximately $0.8 million of Q2 fiscal 2018 restructuring charges were recorded in cost of products sold. De minimis restructuring charges were also recorded in cost of products sold in Q3 fiscal 2018.
 
(2) Adjusted earnings and adjusted diluted earnings per share represent net earnings (loss) and diluted earnings (loss) per share per the Condensed Consolidated Statements of Earnings net of charges or credits for items to be highlighted for comparability purposes. These measures should not be considered as an alternative to net earnings (loss) or diluted earnings (loss) per share or as an indicator of the Company's operating performance. However, this presentation is important to investors for understanding the operating results of the current portfolio of Actuant companies. The total of the individual components may not equal due to rounding.
 
(3) EBITDA represents net earnings (loss) before financing costs, net, income tax (benefit) expense, and depreciation & amortization. EBITDA is not a calculation based upon generally accepted accounting principles (GAAP). The amounts included in the EBITDA and Adjusted EBITDA calculation, however, are derived from amounts included in the Condensed Consolidated Statements of Earnings. EBITDA should not be considered as an alternative to net earnings (loss), operating profit (loss) or operating cash flows. Actuant has presented EBITDA because it regularly reviews this performance measure. In addition, EBITDA is used by many of our investors and lenders, and is presented as a convenience to them. The EBITDA measure presented may not always be comparable to similarly titled measures reported by other companies due to differences in the components of the calculation.

       
 
ACTUANT CORPORATION
SUPPLEMENTAL UNAUDITED DATA
RECONCILIATION OF GAAP TO NON-GAAP GUIDANCE
  (Dollars in millions, except for per share amounts)
 
 
Q4 FISCAL 2018 FISCAL 2018
LOW HIGH LOW HIGH
RECONCILIATION OF GAAP DILUTED EARNINGS PER SHARE TO ADJUSTED
DILUTED EARNINGS PER SHARE GUIDANCE
GAAP DILUTED EARNINGS PER SHARE $ 0.32 $ 0.37 $ 0.58 $ 0.63
IMPAIRMENT & DIVESTITURE CHARGES, NET OF TAX - - 0.21 0.21
RESTRUCTURING CHARGES, NET OF TAX - - 0.16 0.16
INCOME TAX EXPENSE FROM U.S. TAX REFORM - - 0.06 0.06
INCOME TAX EXPENSE FROM EQUITY VESTING/EXERCISES   -   -   0.02     0.02  
ADJUSTED DILUTED EARNINGS PER SHARE GUIDANCE $ 0.32 $ 0.37 $ 1.03   $ 1.08  
 
 
RECONCILIATION OF GAAP CASH FLOW FROM OPERATIONS TO FREE CASH FLOW
CASH FLOW FROM OPERATIONS $ 85 $ 90
CAPITAL EXPENDITURES (25 ) (25 )
OTHER   10     10  
FREE CASH FLOW GUIDANCE $ 70   $ 75  
 
FOOTNOTES
NOTE: Management does not provide guidance on GAAP financial measures as we are unable to predict and estimate with certainty items such as potential impairments, refinancing costs, business divestiture gains/losses, discrete tax adjustments, or other items impacting GAAP financial metrics. As a result, we have included above only those items about which we are aware and are reasonably likely to occur during the guidance period covered.

Actuant Corporation
Karen Bauer
Communications & Investor Relations Leader
262-293-1562

Source: Actuant Corporation