Attached files
| file | filename |
|---|---|
| EX-99.1 - EXHIBIT 99.1 - Cornerstone Building Brands, Inc. | q42016aexhibit991.htm |
| 8-K/A - 8-K/A - Cornerstone Building Brands, Inc. | ncs201612088-ka.htm |
Our Mission & Vision
NCI Building Systems
Full Year and 4Q 2016
Supplemental Presentation
December 9, 2016
Our Mission & Vision
Forward-looking Statements
2
Certain statements and information in this presentation may constitute forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. The words “believe,” “anticipate,” “plan,” “intend,” “foresee,” “guidance,” “potential,”
“expect,” “should,” “will” “continue,” “could,” “estimate,” “forecast,” “goal,” “may,” “objective,” “predict,” “projection,” or similar
expressions are intended to identify forward-looking statements (including those contained in certain visual depictions) in this
presentation. These forward-looking statements reflect the Company's current expectations and/or beliefs concerning future events.
The Company has made every reasonable effort to ensure that the information, estimates, forecasts and assumptions on which these
statements are based are current, reasonable and complete. Our expectations with respect to the first quarter of fiscal 2017 and the full
year 2017 that are contained in this presentation are forward looking statements based on management’s estimates, as of of the date of
this presentation. The estimates are unaudited, and reflect management’s current views with respect to future results. However, the
forward-looking statements in this presentation are subject to a number of risks and uncertainties that may cause the Company's actual
performance to differ materially from that projected in such statements. Among the factors that could cause actual results to differ
materially include, but are not limited to, industry cyclicality and seasonality and adverse weather conditions; challenging economic
conditions affecting the nonresidential construction industry; volatility in the U.S. economy and abroad, generally, and in the credit
markets; substantial indebtedness and our ability to incur substantially more indebtedness; our ability to generate significant cash flow
required to service or refinance our existing debt, including the 8.25% senior notes due 2023, and obtain future financing; our ability to
comply with the financial tests and covenants in our existing and future debt obligations; operational limitations or restrictions in
connection with our debt; increases in interest rates; recognition of asset impairment charges; commodity price increases and/or limited
availability of raw materials, including steel; our ability to make strategic acquisitions accretive to earnings; retention and replacement
of key personnel; enforcement and obsolescence of intellectual property rights; fluctuations in customer demand; costs related to
environmental clean-ups and liabilities; competitive activity and pricing pressure; increases in energy prices; volatility of the Company's
stock price; dilutive effect on the Company's common stockholders of potential future sales of the Company's common stock held by our
sponsor; substantial governance and other rights held by our sponsor; breaches of our information system security measures and
damage to our major information management systems; hazards that may cause personal injury or property damage, thereby subjecting
us to liabilities and possible losses, which may not be covered by insurance; changes in laws or regulations, including the Dodd–Frank
Act; the timing and amount of our stock repurchases; and costs and other effects of legal and administrative proceedings, settlements,
investigations, claims and other matters. See also the “Risk Factors” in the Company's Annual Report on Form 10-K for the fiscal year
ended November 1, 2015, which identifies other important factors, though not necessarily all such factors, that could cause future
outcomes to differ materially from those set forth in the forward-looking statements. The Company expressly disclaims any obligation to
release publicly any updates or revisions to these forward-looking statements, whether as a result of new information, future events, or
otherwise.
Our Mission & Vision
4Q 2016 and Full Year Financial Summary
3 (1) Reconciliations of non-GAAP financial measures to the nearest GAAP measure are included in the Company’s financial tables beginning on Slide 16
(Dollars in millions, except per share amounts)
October
30, 2016
November
1, 2015 % Chg.
October
30, 2016
November
1, 2015 % Chg.
Sales 480.3$ 459.8$ 4.5% 1,684.9$ 1,563.7$ 7.8%
Gross Profit 120.8$ 123.6$ -2.2% 427.9$ 372.3$ 14.9%
Gross Profit Margin 25.2% 26.9% -6.4% 25.4% 23.8% 6.7%
Income from Operations 39.4$ 36.5$ 7.9% 108.8$ 56.8$ 91.4%
Net Income 19.0$ 18.4$ 3.2% 51.0$ 17.8$ 186.4%
Diluted EPS 0.27$ 0.25$ 8.0% 0.70$ 0.24$ 191.7%
Adjusted Operating Income
1
40.9$ 43.8$ -6.8% 114.1$ 79.3$ 43.8%
Adjusted EBITDA
1
53.7$ 56.4$ -4.9% 166.1$ 130.0$ 27.7%
Adjusted Diluted EPS
1
0.28$ 0.31$ -9.7% 0.71$ 0.42$ 69.0%
Fiscal Three Months Ended Fiscal Year Ended
Our Mission & Vision
4Q 2016 Financial Overview
4
Sales were $480.3 million, an increase of $20.5 million or 4.5% from $459.8 million a
year ago
• Revenues for the quarter benefited from both volume increases and pricing discipline
Gross profit margins for the period were 25.2% compared to 26.9% in the comparable
prior year period
• 50 basis points of this year-over-year contraction related in large part to the rapidly rising steel
input costs, compared to rapidly declining costs in 4Q 2015
• The Company recorded a correction to the CENTRIA acquisition opening balance during the
fourth quarter, reducing revenues by $1.8 million and margins by 30 basis points
• Changes in product mix and the costs associated with the manufacturing reorganization
accounted for the remainder of the margin contraction
Operating income was $39.4 million compared to $36.5 million in the prior year period
Net income increased 3.2% to $19.0 million, or $0.27 per diluted common share
compared to $18.4 million, or $0.25 per diluted common share in the prior year period
Adjusted EBITDA1 was $53.7 million compared to $56.4 million in the prior year period
Consolidated backlog grew 3.9% year-over-year to $515.9 million
(1) Reconciliations of non-GAAP financial measures to the nearest GAAP measure are included in the Company’s financial tables beginning on Slide 16
Our Mission & Vision
Full Year 2016 Financial Overview
5
Sales were $1.68 billion, an increase of $121.2 million or 7.8% from $1.56 billion a
year ago
• External tonnage volumes increased 11.8% year-over-year, with the Components segment
showing the largest increase with a 18.6 % increase in volumes
Gross profits improved in all three business segments on a year-over-year basis
• Gross profit margins expanded by 160 basis points from 23.8% in the comparable prior
year period to 25.4%
Operating income was $108.8 million compared to $56.8 million in the prior year
period.
• Adjusted for special items, operating income increased 43.8% to $114.1 million compared
to $79.3 million in the prior year period
Net income increased 186.4% to $51.0 million, or $0.70 per diluted common share
compared to $17.8 million, or $0.24 per diluted common share in the prior year
period
Adjusted EBITDA1 grew 27.7% to $166.1 million from $130.0 million in the prior year
period
(1) Reconciliations of non-GAAP financial measures to the nearest GAAP measure are included in the Company’s financial tables beginning on Slide 16
Our Mission & Vision
6
Manufacturing
• During the quarter, equipment was brought online in the Iowa plant to enable the Company
to move forward with the remainder of its manufacturing footprint changes
• Production of insulated metal panels (IMP) at the plant in Hamilton, ON continued to ramp
up to full capacity
Commercial
• The Company reorganized its two IMP businesses, creating a single leadership team for
CENTRIA and Metl-Span to drive growth across all potential sales channels
• Underlying volume growth across segments outpaced reported market growth rates for low
rise non-residential construction starts
Steel Costs
• The fourth quarter was the first time in fiscal 2016 when steel prices were not a ‘headwind’ as
steel costs prices were higher on a year-over-year basis
• Steel prices are anticipated to increase during 2017 as a result of increased protectionism
and ongoing trade cases that are limiting foreign imports
4Q 2016 Operational Overview
Our Mission & Vision
7
4Q 2016 Revenues and Volumes – by Segment
4Q-'16 4Q-'15 % Chg.
% Vol.
Chg.
1
4Q-'16 4Q-'15 % Chg.
% Vol.
Chg.
1
4Q-'16 4Q-'15 % Chg.
% Vol.
Chg.
1
Third-Party 28.6$ 26.7$ 7.2% 7.9% Third-Party 255.1$ 240.6$ 6.0% 1.6% Third-Party 196.6$ 192.5$ 2.1% 0.2%
Internal 40.7 37.1 9.8% 2.9% Internal 37.3 35.1 6.3% 9.6% Internal 7.6 5.1 49.3% 46.4%
Total Sales 69.3$ 63.7$ 8.7% 5.3% Total Sales 292.4$ 275.7$ 6.1% 2.8% Total Sales 204.2$ 197.6$ 3.3% 2.0%
Metal Coil Coating Metal Components Engineered Building Systems
$-
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
$80.0
4Q-'16 4Q-'15
Metal Coil Coating
Third-Party Internal
$-
$50.0
$100.0
$150.0
$200.0
$250.0
$300.0
$350.0
4Q-'16 4Q-'15
Metal Components
Third-Party Internal
$-
$50.0
$100.0
$150.0
$200.0
$250.0
4Q-'16 4Q-'15
Engineered Building Systems
Third-Party Internal
Metal Coil
Coating
6%
Metal
Components
53%
Consolidated 3rd Party Revenue
4Q 2016
Metal Coil
Coating
6%
Metal
Components
52%
Consolidated 3rd Party Revenue
4Q 2015
(Dollars in millions)
Engineered Building
Systems
41%
Engineered Building
Systems
42%
(1) Calculated as the year-over-year change in the tonnage volumes shipped
Our Mission & Vision
4Q 2016 Business Segment Results1
8
(Dollars in millions)
$69.3
$292.4
$204.2
$480.3
$63.7
$275.7
$197.6
$459.8
Coatings Components Buildings Consolidated
(1) Consolidated segments results do not include intersegment sales
(2) Reconciliation of non-GAAP financial measures to the nearest GAAP measure are included in the Company’s financial tables beginning on Slide 16
Revenue
$7.0
$31.1
$22.8
$39.4
$7.2
$18.2
$25.5
$36.5
Coatings Components Buildings Consolidated
Operating Income
$7.0
$31.6
$23.1
$40.9
$7.2
$26.9
$26.4
$43.8
Coatings Components Buildings Consolidated
Adjusted Operating Income2
$8.2
$37.8
$25.1
$53.7
$8.4
$34.0
$29.0
$56.4
Coatings Components Buildings Consolidated
2016
2015 Adjusted EBITDA2
Our Mission & Vision
Full Year 2016 Business Segment Results1
9
(Dollars in millions)
$247.7
$1,044.0
$672.2
$1,684.9
$231.7
$920.8
$667.2
$1,563.7
Coatings Components Buildings Consolidated
(1) Consolidated segments results do not include intersegment sales
(2) Reconciliation of non-GAAP financial measures to the nearest GAAP measure are included in the Company’s financial tables beginning on Slide 16
Revenue
$25.3
$102.5
$62.0
$108.8
$19.1
$50.5 $51.4
$56.8
Coatings Components Buildings Consolidated
Operating Income
$25.3
$104.6
$61.4
$114.1
$19.3
$69.2
$54.2
$79.3
Coatings Components Buildings Consolidated
Adjusted Operating Income2
$30.0
$131.1
$70.0
$166.1
$23.7
$96.4
$62.9
$130.0
Coatings Components Buildings Consolidated
2016
2015 Adjusted EBITDA2
Our Mission & Vision
Gross Margin Reconciliation
10
Gross Margin 4Q 2015 26.9%
Increasing raw material costs, net of commercial discipline (0.50%)
Transitional manufacturing efficiency costs from plant
consolidation
(0.20%)
Less favorable product and segment mix (0.40%)
New plant ramp-up costs, discontinued plant wind-down costs (0.30%)
Correction of CENTRIA opening balance sheet at acquisition (0.30%)
Gross Margin 4Q 2016 25.2%
For the quarter, gross profit was $120.8 million compared to $123.6 million in the
prior year period
For the full year, gross profit increased $55.6 million to $427.9 million compared
to $372.3 million in fiscal 2015
Note: Point attributions in the above tables are approximate
Our Mission & Vision
Key Cost Initiatives
11
$ in millions
Original
Target 1
2016 Cost
Savings Realized
Manufacturing Consolidation $15.0 - $20.0 $6.0
ESG&A Restructuring $15.0 - $20.0 $6.0
Total $30.0 - $40.0 $12.0
The Manufacturing cost initiative includes the continuing rationalization of
manufacturing facilities and relocation of equipment and machinery
• To date, the Company has added two facilities and closed six facilities contributing
approximately $6.0 million of the expected $15.0 - $20.0 million annualized cost
reductions
The ESG&A initiative includes the elimination of certain fixed and indirect
costs through restructuring and consolidation in Engineering and SG&A costs
• To date, the Company has restructured its commercial operations consolidating
activities where appropriate. These actions have resulted in the realization of
approximately $6.0 million of the expected $15.0 - $20.0 million savings
During fiscal 2017, these two initiatives are expected to generate
approximately an additional $10.0 million in cost savings
(1) Key initiatives are anticipated to generate the target amount of savings by fiscal year-end 2018
Our Mission & Vision
12
Net Income:
Net income increased 3.2% to $19.0 million from $18.4 million in the prior year’s fourth quarter
Adjusted EBITDA1:
(Dollars in millions)
4Q Net Income and Adjusted EBITDA
(1) Reconciliations of non-GAAP financial measures to the nearest GAAP measure are included in the Company’s financial tables beginning on Slide 16
$56.4
$53.7
$2.5
$(3.7)
$3.0
$(1.8)
$(1.6)
$(1.0)
$48.0
$50.0
$52.0
$54.0
$56.0
$58.0
$60.0
$62.0
$64.0
Adjusted EBITDA
4Q 2015
Volume ESG&A Cost
Reductions
Margin
Contraction
CENTRIA
Adjustment
Manufacturing Other Adjusted EBITDA
4Q 2016
Our Mission & Vision
4Q 2016 Cash Flow Summary
13
Cash and Restricted Cash, as of 4Q 2016 3Q 2016 2Q 2016 1Q 2016
Beginning balance $ 50,710 $ 77,916 $ 73,849 $ 99,662
Cash provided by (used in) operating activities 26,933 20,586 24,213 (4,200)
Cash provided by (used in) investing activities 4,054 (4,044) (4,183) (5,777)
Cash used in financing activities (16,018) (43,547) (16,455) (15,495)
Exchange rate effects (276) (201) 492 (341)
Ending balance $ 65,403 $ 50,710 $ 77,916 $ 73,849
Debt Reduction
• In each quarter of fiscal 2016, the Company paid down $10.0 million under its Term Loan,
resulting in total 2016 repayments of $40.0 million (Financing Activity)
Stock Repurchase
• During fiscal 2016, the Company completed the stock repurchase program announced in
January, including the repurchase of approximately $45 million worth of shares from entities
affiliated with Clayton Dubilier & Rice, which was contingent upon and concurrent with the
July 2016 secondary offering previously announced. In September, the Company announced
a second $50 million share repurchase program.
• In the fourth quarter, ~0.5 million shares were repurchased with an average price of $14.32
and during fiscal 2016, ~ 4.5 million shares were repurchased with an average price of
$13.96. (Financing Activity)
(Dollars in thousands)
Our Mission & Vision
4Q 2016 Results Compared to Guidance
14
$ in Millions
Range
Low High 4Q Actuals
Revenues $475.0 $500.0 $480.3
Gross Profit Margin 24.5% 27.0% 25.2%
ESG&A Expenses $80.0 $84.0 $77.6
Intangible Asset Amortization $2.3 $2.5 $2.4
Total Depreciation & Amortization
(inclusive of Intangibles above)
$10.5 $11.5 $9.8
Interest Expense $7.3 $7.7 $7.6
Effective Tax Rate 33.0% 35.0% 40.0%
ESG&A expenses were lower than guidance due to continued cost restructuring successes, lower
incentive compensation costs than expected and favorable experience in the Company’s various
self-insurance programs
Gross profit margin was negatively impacted by the correction to the CENTRIA acquisition
opening balance sheet, which reduced revenues by $1.8 million and margins by ~30 basis points
Even though the annual effective tax rate was 35.4%, the 4th quarter effective rate was higher due
to the inclusion of higher than expected year-end annual tax account reconciliations and true-ups
Our Mission & Vision
1Q and FY 2017 Guidance
15
$ in million
1Q Range
Low High
Revenues $370.0 $390.0
Gross Profit Margin 21.0% 23.5%
ESG&A Expenses $71.0 $75.0
Intangible Asset Amortization $2.3 $2.5
Total Depreciation & Amortization
(inclusive of Intangibles above)
$10.0 $11.0
Interest Expense $7.4 $7.6
Effective Tax Rate 35.0% 37.0%
Guidance for ESG&A excludes the amortization of intangible assets, which is a separate line item
Total Depreciation & Amortization includes the intangible amortization and is reported on the Company’s
Statements of Operations within Cost of Goods Sold, ESG&A Expense and Intangible Asset Amortization
Weighted average diluted common shares is expected to be ~70.7 million for 1Q 2017
Total capital expenditures for fiscal 2017 are expected to be in the range of $25.0 million to $30.0 million
Full year 2017 guidance is expected to reflect the normal quarterly patterns with second half of fiscal
2017 expected to be stronger than the first half
Revenues are expected to be in the range of $1.75 - $1.85 billion
Adjusted EBITDA is expected to be in the range of $175.0 - $205.0 million
Our Mission & Vision
Reconciliation of Net Income (Loss) and Adjusted Net Income (Loss) per
Diluted Common Share
16
(Dollars in thousands, except per share amounts)
Fiscal Three Months Ended Fiscal Year Ended
October 30, November 1, October 30, November 1,
2016 2015 2016 2015
Net income per diluted common share, GAAP basis 0.27$ 0.25$ 0.70$ 0.24$
Restructuring and impairment charges 0.01 0.10 0.06 0.15
Strategic development and acquisition related costs 0.01 0.02 0.04 0.06
Loss (gain) on sale of assets and asset recovery 0.00 - (0.02) -
(Gain) from bargain purchase - - (0.03) -
(Gain) on legal settlements - (0.05) - (0.05)
Fair value adjustment of acquired inventory - - - 0.03
Amortization of short lived acquired intangible - 0.03 - 0.11
Tax effect of applicable non-GAAP adjustments
(2)
(0.01) (0.04) (0.03) (0.12)
Adjusted net income per diluted common share
(1)
0.28$ 0.31$ 0.71$ 0.42$
Fiscal Three Months Ended Fiscal Year Ended
October 30, November 1, October 30, November 1,
2016 2015 2016 2015
Net income applicable to common shares, GAAP basis 18,896$ 18,186$ 50,638$ 17,646$
Restructuring and impairment charges 815 7,611 4,252 11,306
Strategic development and acquisition related costs 590 1,143 2,670 4,201
Loss (gain) on sale of assets and asset recovery 62 - (1,642) -
(Gain) from bargain purchase - - (1,864) -
(Gain) on legal settlements (3,765) (3,765)
Fair value adjustment of acquired inventory - - - 2,358
Amortization of short lived acquired intangible - 2,343 - 8,400
Tax effect of applicable non-GAAP adjustments
(2)
(572) (2,859) (2,059) (8,775)
Adjusted net income applicable to common shares
(1)
19,791$ 22,659$ 51,995$ 31,371$
0.278668 0.71
(0) 0
(1) The Company discloses a tabular comparison of Adjusted net income per diluted common share and Adjusted net income applicable to common shares, which are non-GAAP measures,
because they are referred to in the text of our press releases and are instrumental in comparing the results from period to period. Adjusted net income (loss) per diluted common share
and Adjusted net income applicable to common shares should not be considered in isolation or as a substitute for net income per diluted common share and net income applicable to common
shares as reported on the face of our consolidated statements of operations.
(2) The Company calculated the tax effect of non-GAAP adjustments by applying the applicable statutory tax rate for the period to each applicable non-GAAP item.
Our Mission & Vision
Reconciliation of 4Q 2016 Operating Income (Loss) to Adjusted
Operating Income (Loss) by Segment
17
(Dollars in thousands)
Engineered
Building
Systems
Metal
Components
Metal Coil
Coating Corporate Consolidated
Operating income (loss), GAAP basis 22,830$ 31,059$ 7,018$ (21,515)$ 39,392$ -
Restructuring and impairment charges 211 506 - 98 815 (0)
Strategic development and acquisition related costs # - - - 590 590 -
Loss on sale of assets and asset recovery 62 - - - 62
Adjusted operating income (loss)
(1)
23,103$ 31,565$ 7,018$ (20,827)$ 40,859$
Engineered
Building
Systems
Metal
Components
Metal Coil
Coating Corporate Consolidated
Operating income (loss), GAAP basis # 25,473$ 18,239$ 7,208$ (14,421)$ 36,499$
Restructuring and impairment charges 959 6,365 - 287 7,611
Strategic development and acquisition related costs - - - 1,143 1,143
Gain on legal settlements - - - (3,765) (3,765)
Amortization of short lived acquired intangibles - 2,343 - - 2,343
Adjusted operating income (loss)
(1)
26,432$ 26,947$ 7,208$ (16,756)$ 43,831$
(1) The Company discloses a tabular comparison of Adjusted operating income (loss), which is a non-GAAP measure because it is instrumental in comparing the results from period
to period. Adjusted operating income (loss) should not be considered in isolation or as a substitute for operating income (loss) as reported on the face of our statements of operations.
Fiscal Three Months Ended November 1, 2015
Fiscal Three Months Ended October 30, 2016
Our Mission & Vision
Reconciliation of FY 2016 Operating Income (Loss) to Adjusted
Operating Income (Loss) by Segment
18
(Dollars in thousands)
Engineered
Building Systems
Metal
Components
Metal Coil
Coating Corporate Consolidated
Operating income (loss), GAAP basis 136 62,046$ 102,495$ 25,289$ (81,051)$ 108,779$
Restructuring and impairment charges 966 1,661 39 1,586 4,252
Strategic development and acquisition related costs - 403 - 2,267 2,670
(Gain) on sale of assets and asset recovery #DIV/0! (1,642) - - - (1,642)
Adjusted operating income (loss)
(1)
61,370$ 104,559$ 25,328$ (77,198)$ 114,059$
Engineered
Building Systems
Metal
Components
Metal Coil
Coating Corporate Consolidated
Operating income (loss), GAAP basis 51,410$ 50,541$ 19,080$ (64,200)$ 56,831$
Restructuring and impairment charges 2,756 7,866 254 430 11,306
Strategic development and acquisition related costs - - - 4,201 4,201
(Gain) on legal settlements (3,765) (3,765)
Fair value adjustment of acquired inventory - 2,358 - - 2,358
Amortization of short lived acquired intangibles - 8,400 - - 8,400
Adjusted operating income (loss)
(1)
54,166$ 69,165$ 19,334$ (63,334)$ 79,331$
(1) The Company discloses a tabular comparison of Adjusted operating income (loss), which is a non-GAAP measure because it is instrumental in comparing the results from
period to period. Adjusted operating income (loss) should not be considered in isolation or as a substitute for operating income (loss) as reported on the face of our
statements of operations.
Fiscal Year Ended October 30, 2016
Fiscal Year Ended November 1, 2015
Our Mission & Vision
Reconciliation of 4Q 2016 Net Income (Loss) to Adjusted EBITDA by
Segment
19
(Dollars in thousands)
Engineered
Building
Systems
Metal
Components
Metal Coil
Coating Corporate Consolidated
Net income (loss) 24,738$ 31,309$ 7,018$ (44,064)$ 19,001$
Add:
Depreciation and amortization 2,399 5,979 1,202 237 9,817$
Consolidated interest expense, net 7 (14) - 7,554 7,548
Provision for income taxes (2,276) 7 - 14,918 12,649
Restructuring and impairment charges 211 506 - 98 815
Strategic development and acquisition related costs - - - 590 590
Share-based compensation - - - 3,181 3,181
Loss on sale of assets and asset recovery 62 - - - 62
Adjusted EBITDA
(1)
25,141$ 37,787$ 8,220$ (17,485)$ 53,663$
Engineered
Building
Systems
Metal
Components
Metal Coil
Coating Corporate Consolidated
Net income (loss) 7,001$ 18,282$ 7,209$ (14,085)$ 18,407$
Add:
Depreciation and amortization 2,555 9,387 1,156 257 13,354
Consolidated interest expense, net 11,103 (19) - (3,092) 7,993
Provision (benefit) for income taxes 7,388 - - 2,642 10,029
Restructuring and impairment charges 959 6,365 - 287 7,611
(Gain) on legal settlements - - - (3,765) (3,765)
Strategic development and acquisition related costs (0) - - 1,143 1,143
Share-based compensation - - - 1,677 1,677 Gain on sale of asset and asset recovery
Adjusted EBITDA
(1)
29,006$ 34,016$ 8,365$ (14,937)$ 56,449$
- - - - 1
(1) The Company's Credit Agreement defines Adjusted EBITDA. Adjusted EBITDA excludes non-cash charges for goodwill and other asset impairments
and stock compensation as well as certain special charges. As such, the historical information is presented in accordance with the definition above.
Concurrent with the amendment and restatement of the Term Loan facility, the Company entered into an Asset-Based Lending facility which has substantially
the same definition of Adjusted EBITDA except that the ABL facility caps certain non-recurring charges. The Company is disclosing Adjusted EBITDA, which is
a non-GAAP measure, because it is used by management and provided to investors to provide comparability of underlying operational results.
Fiscal Three Months Ended October 30, 2016
Fiscal Three Months Ended November 1, 2015
Our Mission & Vision
Reconciliation of FY 2016 Net Income (Loss) to Adjusted EBITDA by
Quarter
20
(Dollars in thousands)
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Fiscal Year Ended
January 31, May 1, July 31, October 30, October 30,
2016 2016 2016 2016 2016
Net income 5,892$ 2,420$ 23,715$ 19,001$ 51,028$
Add:
Depreciation and amortization 10,747 10,765 10,595 9,817 41,924
Consolidated interest expense, net 7,847 7,792 7,685 7,548 30,872
Provision for income taxes 2,453 1,209 11,627 12,649 27,938
Restructuring and impairment charges 1,510 1,149 778 815 4,252
(Gain) from bargain purchase (1,864) - - - (1,864)
Strategic development and acquisition related costs 681 579 819 590 2,669
Share-based compensation 2,582 2,468 2,661 3,181 10,892
(Gain) loss on sale of assets and asset recovery (725) (927) (52) 62 (1,642)
Adjusted EBITDA
(1)
29,123$ 25,455$ 57,828$ 53,663$ 166,069$
1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Fiscal Year Ended
February 1, May 3, August 2, November 1, November 1,
2015 2015 2015 2015 2015
Net income (loss) (320)$ (7,489)$ 7,220$ 18,407$ 17,818$
Add:
Depreciation and amortization 9,731 13,766 14,541 13,354 51,392
Consolidated interest expense, net 3,980 8,280 8,135 7,993 28,388
Provision (benefit) for income taxes (490) (4,087) 3,520 10,029 8,972
Restructuring and impairment charges 1,477 1,714 504 7,611 11,306
Strategic development and acquisition related costs 1,729 628 701 1,143 4,201
(Gain) on legal settlements - - - (3,765) (3,765)
Fair value adjustment of acquired inventory 583 775 1,000 - 2,358
Share-based compensation 2,933 2,201 2,568 1,677 9,379 Gain on sale of asset and asset recovery -
Adjusted EBITDA
(1)
19,623$ 15,788$ 38,189$ 56,449$ 130,049$
(1) The Company's Credit Agreement defines Adjusted EBITDA. Adjusted EBITDA excludes non-cash charges for goodwill and other asset impairments and stock compensation
as well as certain special charges. As such, the historical information is presented in accordance with the definition above. Concurrent with the amendment and restatement of the
Term Loan facility, the Company entered into an Asset-Based Lending facility which has substantially the same definition of Adjusted EBITDA except that the ABL facility caps
certain non-recurring charges. The Company is disclosing Adjusted EBITDA, which is a non-GAAP measure, because it is used by management and provided to investors to provide
comparability of underlying operational results.
Our Mission & Vision
K. DARCEY MATTHEWS
Vice President, Investor Relations
E: darcey.matthews@ncigroup.com
10943 N. Sam Houston Pkwy W.
Houston, Texas 77064
P.O. Box 692055
Houston, Texas 77269-2055
281.897.7788
ncibuildingsystems.com