- Revenue of $28.8 million, up 6% over prior-year period;
Fiscal year-to-date revenue increased 16%
- Diluted loss per share of $0.35 primarily due to Navy
project labor and material cost overruns at Batavia
facility
- Added more contract resources in Batavia, NY to ensure
timely execution of defense projects; significantly contributed to
third quarter loss
- Suspended dividend; obtained waiver of financial covenants
and is working with lender to amend credit facility in fourth
quarter
- Defense industry revenue and order backlog validate success
of strategy to diversify beyond refining and petrochemical
industry
- Defense revenue in quarter of $16.6 million represents 58%
of total revenue
- Record backlog of $272.6 million comprised of 77% from
defense industry
- Orders of $68 million in the quarter included $37.3 million
of orders received by BN
- Barber-Nichols (“BN”) performance to date exceeding
expectations
Graham Corporation (NYSE: GHM), a global business that designs,
manufactures, and sells critical equipment for the defense/space,
energy/new energy, and chemical/petrochemical industries, today
reported financial results for its third quarter and nine months
ended December 31, 2021, of the fiscal year ending March 31, 2022
(“fiscal 2022”). Financial results include those of Barber-Nichols
(“BN”) from the date it was acquired on June 1, 2021.
Daniel J. Thoren, President and CEO, commented, “While we are
executing on our diversification strategy to increase our
participation in the defense industry and more than half of our
revenue in the third quarter was generated from tier one defense
contractors, there are clearly challenges within our Batavia, NY
defense operations. We understand the issues and we are
aggressively taking steps to resolve them.”
He noted, “The current high volume of defense work has exceeded
the labor capacity of our Batavia facility, as its growth
inflection coincided with the COVID-19 pandemic onset. To maintain
critical schedules on two major Navy projects, we chose to incur
substantial additional costs, primarily through the use of contract
welders and outsourcing commercial work where possible. This led to
significant cost overruns and drove the disappointing results in
the quarter, the breach of our financial covenants under our term
loan and revolving credit facility, and the need to suspend our
dividend. We believe the long-term benefit of maintaining our
position with our defense customers outweighed the short-term cost.
We expect the need for these extraordinary additional costs for
these two large U.S. Navy projects will be largely behind us after
the first half of fiscal 2023.
“To ensure we meet delivery requirements for all customers and
improve long-term margins, we are moving quickly to address the
labor capacity and operational issues in Batavia by expanding our
skilled labor force via training investments, reducing the use of
contract labor and adding a dedicated business leader for even
greater focus on our Navy channel. Additionally, to drive
profitability for repeat Navy projects, we are improving
documentation of build processes and reviewing current and new
contract pricing models.”
Mr. Thoren concluded, “Our short-term challenges are real and we
are addressing them head-on. That said, I remain enthusiastic about
the future of the Company. We have positive momentum with our
diversification strategy and BN is on track to deliver above
expectations on our acquisition plan. We have record backlog and
had several significant defense industry wins in the quarter. In
our refining and chemical/petrochemical business, demand in our
aftermarket business has accelerated, which is typically a leading
indicator of recovery in those markets. We believe we are also well
positioned in new energy as well as our traditional commercial
markets. As we look out over the next three years, we believe our
strategy will result in a stronger business with materially
expanded margins and high single digit to low double digit top-line
growth.”
Third Quarter Fiscal 2022 Sales Summary (All comparisons
are with the same prior-year period unless noted otherwise.)
Net sales of $28.8 million increased 6%, or $1.6 million, as the
$12.0 million in BN sales more than offset declines in the refining
and chemical business. Sales to the defense industry were $16.6
million, up from $4.5 million while sales to the refining industry
were $4.0 million, down from $16.5 million. Space, a new industry
for the Company resulting from the BN acquisition, contributed $1.5
million in revenue. See the accompanying financial tables for a
further breakdown of sales by industry and region.
Fluctuations in Graham’s sales among geographic locations and
industries can vary measurably from quarter-to-quarter based on the
timing and magnitude of projects. Graham does not believe that such
quarter-to-quarter fluctuations are indicative of business
trends.
Third Quarter Fiscal 2022 Performance Review (All
comparisons are with the same prior-year period unless noted
otherwise.)
($ in millions except per share data)
Q3 FY22 Q3 FY21
Change Net sales
$
28.8
$
27.2
$
1.6
Gross profit
$
0.6
$
6.2
$
(5.7)
Gross margin
1.9%
22.9%
Operating (loss) profit
$
(4.6)
$
1.3
$
(5.9)
Operating margin
(15.9%)
4.8%
Net (loss) income
$
(3.7)
$
1.1
$
(4.8)
Diluted EPS
$
(0.35)
$
0.11
Adjusted EBITDA
$
(2.6)
$
1.8
$
(4.4)
Adjusted EBITDA margin
(9.0%)
6.7%
*Graham believes that Adjusted EBITDA (defined as consolidated
net (loss) income before net interest expense, income taxes,
depreciation, amortization, other acquisition related expenses
(income), and other nonrecurring expenses), and Adjusted EBITDA
margin (Adjusted EBITDA as a percentage of sales), which are
non-GAAP measures, help in the understanding of its operating
performance. Moreover, Graham’s credit facility also contains
ratios based on EBITDA. Graham also believes that adjusted diluted
(loss) earnings per share, which excludes intangible amortization,
other costs related to the acquisition, and other nonrecurring
(income) expenses, provides a better representation of the cash
earnings of the Company. See the attached table on page 10 for
additional important disclosures regarding Graham’s use of Adjusted
EBITDA, Adjusted EBITDA margin and Adjusted diluted (loss) earnings
per share as well as the reconciliation of net (loss) income to
Adjusted EBITDA and Adjusted diluted (loss) earnings per share.
The significant decline in gross profit and contraction of gross
margin reflected the higher-than-expected costs related to the
defense business at Graham’s Batavia operations. Resources have
been redirected to ensure critical defense orders meet customers’
delivery expectations. In addition, higher cost contracted labor
has been employed to address the Company’s U.S. Navy business
requirements.
Selling, general and administrative (“SG&A”) expenses in the
third quarter of fiscal 2022 were $5.0 million, up $0.1 million
primarily as a result of acquisition amortization expense. SG&A
expenses related to BN was $1.2 million, including intangible asset
amortization. The prior-year period included higher incentive
compensation and costs related to the BN acquisition.
Net loss and loss per diluted share were $3.7 million and $0.35,
respectively. On a non-GAAP basis, which excludes intangible
amortization, other costs related to the acquisition, and other
nonrecurring (income) expenses, adjusted diluted loss per share was
$0.27.
YTD Fiscal 2022 Performance Review (Compared with the
prior-year period unless noted otherwise)
($ in millions except per share data)
YTD FY22 YTD
FY21 Change Net sales
$
83.1
$
71.8
$
11.3
Gross profit
$
4.9
$
15.5
$
(10.6)
Gross margin
5.9%
21.6%
Operating (loss) profit
$
(9.3)
$
2.4
$
(11.7)
Operating margin
(11.2%)
3.3%
Net (loss) income
$
(7.3)
$
2.0
$
(9.3)
Diluted EPS
$
(0.70)
$
0.20
Adjusted EBITDA
$
(5.4)
$
4.0
$
(9.4)
Adjusted EBITDA margin
(6.5%)
5.6%
Net sales for the first nine months of fiscal 2022 were $83.1
million, up $11.3 million, or 16%, driven by sales of $31.9 million
from the BN acquisition. Sales to the defense industry increased
$26.1 million to $43.5 million, representing 52% of total revenue.
The expansion in defense was partially offset by declines in the
commercial refining markets, primarily in Asia.
Sales in the U.S. increased $27.4 million, or 73%, to $64.8
million and was 78% of total sales in the first nine months of
fiscal 2022. International sales, which accounted for 22% of total
sales, decreased by $16.1 million, or 47%, to $18.3 million.
Gross profit and margin were down compared with the prior-year
period due to the same factors which impacted the quarter. The
impact of the low margin defense projects and related cost overruns
in the Batavia operations are expected to lessen over the next few
quarters and be largely behind us after the end of September 2022.
The BN acquisition has helped to offset those losses.
SG&A expenses in the first nine months of fiscal 2022 were
$15.2 million, including intangible amortization of $0.6 million,
an increase of $2.1 million, compared with SG&A expenses of
$13.1 million in the first nine months of fiscal 2021. The increase
was due to the addition of the BN business which has added $3.1
million in incremental expenses, including $0.6 million of
intangible amortization. Offsetting this increase were reduced
costs associated with acquisition activities and incentive
compensation.
Cash Management and Balance Sheet
Cash, cash equivalents and investments at December 31, 2021,
were $14.0 million compared with $16.5 million at September 30,
2021.
Net cash used by operating activities for the first nine months
of fiscal 2022 was $14.6 million compared with $0.7 million of cash
generated for the first nine months of fiscal 2021. The increase in
cash used was primarily due to operating losses and timing of
working capital requirements.
Debt at the end of the quarter included $19 million principal on
the $20 million term loan and $9.75 million drawn on the $30
million revolver. The third quarter loss resulted in the Company
being out of compliance with two financial covenants under the term
loan and revolver for which the Company subsequently obtained a
waiver. The Company was in compliance with its fixed asset coverage
ratio at the end of the third quarter. Graham is working with its
lender to execute an amended credit facility in the fourth quarter
of fiscal 2022.
The Board of Directors also has suspended its dividend subject
to the Company’s analysis of capital allocation priorities and any
requirements of a revised lending agreement.
Jeffrey F. Glajch, Chief Financial Officer, commented, “We
believe we have sufficient liquidity between our cash generated
from operations and cash on hand for the foreseeable future. In
fact, in the month of January 2022, we paid down nearly $4 million
on our revolver with cash generated from operations. Unfortunately,
the unexpected extended period of significant losses incurred at
our Batavia operations impacted our ability to meet our financial
covenants and required a waiver. We have been proactively working
with our lender with the goal to have an amended lending agreement
in place by fiscal year end.”
Capital expenditures in the quarter were $0.7 million and fiscal
year-to-date were $1.9 million. The Company now expects capital
expenditures for fiscal 2022 to be between $2.5 million to $3.0
million.
Orders and Backlog
Q1 21 Q2 21 Q3 21 Q4 21 FY2021
Q1 22 Q2 22 Q3 22 Orders
$
11.5
$
35.0
$
61.8
$
13.4
$
121.6
$
20.9
$
31.4
$
68.0
Backlog
$
107.2
$
114.9
$
149.7
$
137.6
$
137.6
$
235.9
$
233.2
$
272.6
Orders for the three-month period ended December 31, 2021, were
up $6.2 million, or 10%, to $68.0 million compared with $61.8
million for the same period of fiscal 2021. BN orders in the
quarter were $37.3 million.
Defense industry orders were $45.6 million in the quarter.
Included in the defense industry awards was a contract to provide
alternators and regulators for the MK 48 MOD 7 heavyweight torpedo
over a multi-year period. This order also includes possible option
awards for an additional six years. Other defense orders included
Block V Virginia-class Submarine torpedo ejection pumps and heat
exchangers for the submarines.
After-market and small parts orders for the refining and
chemical/petrochemical markets were approximately $7 million in the
third quarter. The Company also received an order to supply
ejectors and condensers for a new refinery in China.
Backlog at December 31, 2021, was $272.6 million, compared with
$233.2 million at September 30, 2021, a 17% increase, and $137.6
million at March 31, 2021. Approximately 40% to 50% of orders
currently in our backlog are expected to be converted to sales
within one year. Most of the orders that are expected to convert
beyond twelve months are for the defense industry, specifically the
U.S. Navy.
Backlog by industry at December 31, 2021, was approximately:
- 77% for defense projects
- 11% for refinery projects
- 5% for chemical/petrochemical projects
- 3% for space projects
- 4% for other industrial applications
Fiscal 2022 Guidance
Revenue in fiscal 2022 is now expected to be $120 million to
$125 million which implies revenue of $37 million to $42 million in
the fourth quarter. Fiscal 2022 revenue expectations include BN’s
anticipated 10-month revenue contribution for the fiscal year of
approximately $45 million to $48 million in revenue.
Adjusted EBITDA* is expected to be a loss of approximately $5
million, which implies breakeven adjusted EBITDA in the fourth
quarter of fiscal 2022.
The Company adjusted its expectations for gross margin for
fiscal 2022 to now be approximately 8% to 10% and for SG&A
expenses to be approximately 16% to 17% of sales. The expected
effective tax rate for fiscal 2022 is approximately 18% to 20%.
*Please refer to and read the safe harbor statement below
regarding forward-looking non-GAAP measures.
Webcast and Conference Call
Graham’s management will host a conference call and live webcast
today at 4:45 p.m. Eastern Time to review its financial condition
and operating results for the third quarter of fiscal 2022, as well
as its strategy and outlook. The review will be accompanied by a
slide presentation, which will be made available immediately prior
to the conference call on Graham’s website at
https://ir.grahamcorp.com/. A question-and-answer session will
follow the formal presentation. Graham’s conference call can be
accessed by calling (201) 689-8560. Alternatively, the webcast can
be monitored on Graham’s investor relations website.
A telephonic replay will be available from 7:45 p.m. ET today
through Monday, February 14, 2022. To listen to the archived call,
dial (412) 317-6671 and enter conference ID number 13725923. A
transcript of the call will be placed on Graham’s website, once
available.
ABOUT GRAHAM CORPORATION
Graham is a global business that designs, manufactures, and
sells critical equipment for the defense/space, energy/new energy,
and chemical/petrochemical industries. The Graham and
Barber-Nichols’ global brands are built upon world-renowned
engineering expertise in vacuum and heat transfer, cryogenics, and
turbomachinery technologies, as well as the Company’s responsive
and flexible service and unsurpassed quality.
Graham routinely posts news and other important information on
its website, www.graham-mfg.com, where additional comprehensive
information on Graham Corporation and its subsidiaries can be
found.
Safe Harbor Regarding Forward Looking Statements
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as
amended.
Forward-looking statements are subject to risks, uncertainties
and assumptions and are identified by words such as “expects,”
“estimates,” “outlook,” “anticipates,” “believes,” “implies”,
“could,” “opportunities,” “goal,” “plans,” ”may,” “will,” and other
similar words. All statements addressing operating performance,
events, or developments that Graham Corporation expects or
anticipates will occur in the future, including but not limited to,
its dividend, any future waivers of financial covenants, any
amendments to its credit facility, its ability and the timing
needed to address challenges in its defense business, including at
the Batavia, NY operations, profitability of future projects, the
development and impact of better documentation of build processes
and pricing models, its ability to meet customers’ delivery
expectations, the future impact of low margin defense projects and
related cost overruns, anticipated capital contributions, the
future expected contributions of BN, expected expansion and growth
opportunities within its domestic and international markets,
anticipated revenue, adjusted EBITDA, adjusted EBITDA margins, and
SG&A expenses, the timing of conversion of backlog to sales,
market presence, profit margins, tax rates, foreign sales
operations, its ability to improve cost competitiveness and
productivity, customer preferences, changes in market conditions in
the industries in which it operates, labor constraints, the effect
on its business of volatility in commodities prices, including, but
not limited to, changes in general economic conditions and customer
behavior, forecasts regarding the timing and scope of the economic
recovery in its markets, its acquisition and growth strategy and
its operations in China, India and other international locations,
are forward-looking statements. Because they are forward-looking,
they should be evaluated in light of important risk factors and
uncertainties. These risk factors and uncertainties are more fully
described in Graham Corporation’s most recent Annual Report filed
with the Securities and Exchange Commission, included under the
heading entitled “Risk Factors.”
Should one or more of these risks or uncertainties materialize
or should any of Graham Corporation’s underlying assumptions prove
incorrect, actual results may vary materially from those currently
anticipated. In addition, undue reliance should not be placed on
Graham Corporation’s forward-looking statements. Except as required
by law, Graham Corporation disclaims any obligation to update or
publicly announce any revisions to any of the forward-looking
statements contained in this news release.
In addition, forward looking adjusted EBITDA and adjusted EBITDA
margin are non-GAAP measures. The Company is unable to present a
quantitative reconciliation of these forward-looking non-GAAP
financial measures to their most directly comparable
forward-looking GAAP financial measures because such information is
not available, and management cannot reliably predict the necessary
components of such GAAP measures without unreasonable effort or
expense. In addition, the Company believes that such
reconciliations would imply a degree of precision that would be
confusing or misleading to investors. The unavailable information
could have a significant impact on the Company’s fiscal 2022
financial results. These non-GAAP financial measures are
preliminary estimates and are subject to risks and uncertainties,
including, among others, changes in connection with purchase
accounting, quarter-end and year-end adjustments. Any variation
between the Company’s actual results and preliminary financial data
set forth above may be material.
FINANCIAL TABLES FOLLOW.
Graham Corporation
Consolidated Statements of
Operations - Unaudited
(Amounts in thousands, except per
share data)
Three Months Ended Nine Months Ended
December 31, December 31,
2021
2020
% Change
2021
2020
% Change
Net sales
$
28,774
$
27,154
6%
$
83,077
$
71,818
16%
Cost of products sold
28,213
20,927
35%
78,159
56,330
39%
Gross profit
561
6,227
(91%)
4,918
15,488
(68%)
Gross margin
1.9
%
22.9
%
5.9
%
21.6
%
Other expenses and income:
Selling, general and administrative
4,729
4,936
(4%)
14,534
13,091
11%
Selling, general and administrative – amortization
274
-
NA
639
-
NA
Other operating income, net
140
-
NA
(962
)
-
NA
Operating (loss) profit
(4,582
)
1,291
NA
(9,293
)
2,397
NA
Operating margin
(15.9
%)
4.8
%
-11.2
%
3.3
%
Other income
(111
)
(55
)
102%
(416
)
(164
)
154%
Interest income
(12
)
(23
)
(48%)
(43
)
(143
)
(70%)
Interest expense
132
1
13100%
300
9
3233%
(Loss) income before (benefit) provision for income taxes
(4,591
)
1,368
NA
(9,134
)
2,695
NA
(Benefit) provision for income taxes
(861
)
308
NA
(1,786
)
709
NA
Net (loss) income
$
(3,730
)
$
1,060
NA
$
(7,348
)
$
1,986
NA
Per share data:
Basic:
Net (loss) income
$
(0.35
)
$
0.11
NA
$
(0.70
)
$
0.20
NA
Diluted:
Net (loss) income
$
(0.35
)
$
0.11
NA
$
(0.70
)
$
0.20
NA
Weighted average common shares outstanding:
Basic
10,638
9,977
10,507
9,950
Diluted
10,638
9,977
10,507
9,950
Dividends declared per share
$
0.11
$
0.11
$
0.33
$
0.33
N/A: Not Applicable
Graham Corporation
Consolidated Balance Sheets –
Unaudited
(Amounts in thousands, except per
share data)
December 31,
March 31,
2021
2021
Assets Current assets: Cash and cash equivalents
$
13,991
$
59,532
Investments
-
5,500
Trade accounts receivable, net of allowances ($176 and $29 at
December 31 and March 31, 2021, respectively)
36,650
17,378
Unbilled revenue
24,930
19,994
Inventories
20,428
17,332
Prepaid expenses and other current assets
1,905
512
Income taxes receivable
2,670
-
Total current assets
100,574
120,248
Property, plant and equipment, net
25,218
17,618
Prepaid pension asset
7,121
6,216
Operating lease assets
8,708
95
Goodwill
22,823
-
Customer relationships
11,456
-
Technology and technical know-how
9,805
-
Other intangible assets, net
10,173
-
Other assets
202
103
Total assets
$
196,080
$
144,280
Liabilities and stockholders’ equity Current
liabilities: Short-term debt obligations
$
9,750
$
-
Current portion of long-term debt
2,000
-
Current portion of finance lease obligations
23
21
Accounts payable
14,650
17,972
Accrued compensation
7,951
6,106
Accrued expenses and other current liabilities
5,414
4,628
Customer deposits
27,665
14,059
Operating lease liabilities
1,114
46
Income taxes payable
-
741
Total current liabilities
68,567
43,573
Long-term debt
17,000
-
Finance lease obligations
17
34
Operating lease liabilities
7,702
37
Deferred income tax liability
977
635
Accrued pension and postretirement benefit liabilities
1,958
2,072
Other long-term liabilities
2,320
-
Total liabilities
98,541
46,351
Stockholders’ equity: Preferred stock, $1.00 par
value, 500 shares authorized
-
-
Common stock, $0.10 par value, 25,500 shares authorized, 10,810 and
10,748 shares issued and 10,638 and 9,959 shares outstanding at
December 31 and March 31, 2021, respectively
1,081
1,075
Capital in excess of par value
27,608
27,272
Retained earnings
78,500
89,372
Accumulated other comprehensive loss
(6,565
)
(7,397
)
Treasury stock (172 and 790 shares at December 31 and March 31,
2021, respectively)
(3,085
)
(12,393
)
Total stockholders’ equity
97,539
97,929
Total liabilities and stockholders’ equity
$
196,080
$
144,280
Graham Corporation
Consolidated Statements of
Cash Flows – Unaudited
(Amounts in thousands)
Nine Months Ended
December 31,
2021
2020
Operating activities: Net (loss) income
$
(7,348
)
$
1,986
Adjustments to reconcile net (loss) income to net cash (used)
provided by operating activities: Depreciation
2,232
1,458
Amortization
1,765
-
Amortization of actuarial losses
725
799
Equity-based compensation expense
599
821
Gain on disposal or sale of property, plant and equipment
22
3
Change in fair value of contingent consideration
(1,900
)
-
Deferred income taxes
152
776
(Increase) decrease in operating assets: Accounts receivable
(10,964
)
(4,220
)
Unbilled revenue
2,186
(284
)
Inventories
579
4,999
Prepaid expenses and other current and non-current assets
(933
)
(76
)
Income taxes receivable
(3,423
)
(119
)
Operating lease assets
744
116
Prepaid pension asset
(905
)
(631
)
Increase (decrease) in operating liabilities: Accounts payable
(6,058
)
1,401
Accrued compensation, accrued expenses and other current and
non-current liabilities
465
1,754
Customer deposits
7,553
(8,092
)
Operating lease liabilities
(663
)
(116
)
Long-term portion of accrued compensation, accrued pension
liability and accrued postretirement benefits
620
95
Net cash (used) provided by operating activities
(14,552
)
670
Investing activities: Purchase of property, plant and
equipment
(1,909
)
(1,462
)
Proceeds from disposal of property, plant and equipment
-
6
Purchase of investments
-
(37,103
)
Redemption of investments at maturity
5,500
71,651
Acquisition of Barber-Nichols, LLC
(59,563
)
-
Net cash (used) provided by investing activities
(55,972
)
33,092
Financing activities: Increase in short-term debt
obligations
9,750
-
Principal repayments on long-term debt
(1,000
)
(4,599
)
Proceeds from the issuance of long-term debt
20,000
4,599
Principal repayments on finance lease obligations
(15
)
(35
)
Repayments on lease financing obligations
(157
)
-
Payment of debt issuance costs
(150
)
-
Dividends paid
(3,524
)
(3,292
)
Purchase of treasury stock
(41
)
(23
)
Net cash provided (used) by financing activities
24,863
(3,350
)
Effect of exchange rate changes on cash
120
425
Net (decrease) increase in cash and cash equivalents
(45,541
)
30,837
Cash and cash equivalents at beginning of period
59,532
32,955
Cash and cash equivalents at end of period
$
13,991
$
63,792
Graham Corporation
Adjusted EBITDA Reconciliation
- Unaudited
(Amounts in thousands)
Three Months Ended
Nine Months Ended
December 31,
December 31,
2021
2020
2021
2020
Net (loss) income
$
(3,730
)
$
1,060
$
(7,348
)
$
1,986
Acquisition related inventory step-up expense
27
-
68
-
Acquisition related costs
111
-
373
-
Change in fair value of contingent consideration
-
-
(1,900
)
-
CEO and CFO severance
140
-
938
-
Net interest expense (income)
120
(22
)
257
(134
)
Income taxes
(861
)
308
(1,786
)
709
Depreciation & amortization
1,589
486
3,997
1,458
Adjusted EBITDA
$
(2,604
)
$
1,832
$
(5,401
)
$
4,019
Adjusted EBITDA margin %
-9.0
%
6.7
%
-6.5
%
5.6
%
Adjusted Net Income
Reconciliation - Unaudited
(Amounts in thousands)
Three Months Ended
Nine Months Ended
December 31,
December 31,
2021
2020
2021
2020
Net income (loss)
$
(3,730
)
$
1,060
$
(7,348
)
$
1,986
Acquisition related inventory step-up expense
27
-
68
#
-
Acquisition related costs
111
-
373
#
-
Amortization of intangible assets
756
-
1,765
-
Change in fair value of contingent consideration
-
-
(1,900
)
-
CEO and CFO severance
140
-
938
-
Normalize tax rate to 20%(1)
(207
)
-
(249
)
-
Adjusted net income (loss)
$
(2,903
)
$
1,060
$
(6,353
)
$
1,986
Adjusted diluted earnings per share
$
(0.27
)
$
0.11
$
(0.60
)
$
0.20
1)
Applies a normalized tax rate of 20% to
non-GAAP adjustments above, which are each pre-tax.
Non-GAAP Financial Measure:
Adjusted EBITDA is defined as consolidated net (loss) income
before net interest expense, income taxes, depreciation,
amortization, other acquisition related expenses, and other
nonrecurring expenses. Adjusted EBITDA margin is defined as
Adjusted EBITDA as a percentage of sales. Adjusted EBITDA and
Adjusted EBITDA margin are not measures determined in accordance
with generally accepted accounting principles in the United States,
commonly known as GAAP. Nevertheless, Graham believes that
providing non-GAAP information, such as Adjusted EBITDA, is
important for investors and other readers of Graham's financial
statements, as it is used as an analytical indicator by Graham's
management to better understand operating performance. Moreover,
Graham’s credit facility also contains ratios based on EBITDA.
Because Adjusted EBITDA is a non-GAAP measure and is thus
susceptible to varying calculations, Adjusted EBITDA, as presented,
may not be directly comparable to other similarly titled measures
used by other companies.
Adjusted net income and adjusted diluted (loss) earnings per
share are defined as net income and diluted (loss) earnings per
share as reported, adjusted for certain items and at a normalized
tax rate. Adjusted net income and adjusted diluted (loss) earnings
per share are not measures determined in accordance with generally
accepted accounting principles in the United States, commonly known
as GAAP, and may not be comparable to the measures as used by other
companies. Nevertheless, Graham believes that providing non-GAAP
information, such as adjusted net income and adjusted diluted
(loss) earnings per share, is important for investors and other
readers of the Company’s financial statements and assists in
understanding the comparison of the current quarter’s and current
fiscal year's net income and diluted (loss) earnings per share to
the historical periods' net income and diluted (loss) earnings per
share. Graham also believes that adjusted (loss) earnings per
share, which adds back intangible amortization expense related to
acquisitions, provides a better representation of the cash earnings
of the Company.
Graham Corporation
Additional Information –
Unaudited
($ in millions)
ORDERS BY INDUSTRY FY 2022* Q1 % of
Q2 % of Q3 % of YTD % of
6/30/21 Total 9/30/21 Total
12/31/21 Total 12/31/21 Total Refining
$
11.4
55%
$
5.0
16%
$
8.4
12%
$
24.8
21%
Chemical/ Petrochemical
$
3.4
16%
$
6.1
19%
$
6.2
9%
$
15.6
13%
Defense
$
2.4
12%
$
12.4
40%
$
45.6
67%
$
60.4
50%
Space
$
-
0%
$
2.4
8%
$
2.9
4%
$
5.2
4%
Other Commercial
$
3.6
17%
$
5.6
17%
$
5.0
8%
$
14.2
12%
Total
$
20.9
$
31.4
$
68.0
$
120.2
ORDERS BY INDUSTRY FY 2021* Q1 % of Q2
% of Q3 % of Q4 % of
FY2021 % of 6/30/20 Total
9/30/20 Total 12/31/20 Total
3/31/21 Total Total Refining
$
8.7
76%
$
16.8
48%
$
3.2
5%
$
2.4
17%
$
31.0
26%
Chemical/ Petrochemical
$
1.6
14%
$
3.3
9%
$
4.6
7%
$
2.7
20%
$
12.3
10%
Defense
$
(1.2)
-10%
$
12.6
36%
$
52.3
85%
$
5.4
41%
$
69.2
57%
Other Commercial
$
2.4
20%
$
2.3
7%
$
1.7
3%
$
2.9
22%
$
9.1
7%
Total
$
11.5
$
35.0
$
61.8
$
13.4
$
121.6
*Quarters may not sum to
year-to-date/total fiscal year due to rounding.
Graham Corporation
Additional Information –
Unaudited
($ in millions)
SALES BY INDUSTRY FY 2022* Q1 % of
Q2 % of Q3 % of YTD % of
6/30/21 Total 9/30/21 Total
12/31/21 Total 12/31/21 Total Refining
$
4.6
23%
$
6.3
19%
$
4.0
14%
$
14.9
18%
Chemical/ Petrochemical
$
4.6
23%
$
3.5
10%
$
3.0
11%
$
11.1
13%
Defense
$
7.1
35%
$
19.8
58%
$
16.6
58%
$
43.5
52%
Space
$
0.7
4%
$
1.3
4%
$
1.5
5%
$
3.5
4%
Other Commercial
$
3.2
15%
$
3.2
9%
$
3.7
12%
$
10.1
13%
Total
$
20.2
$
34.1
$
28.8
$
83.1
SALES BY INDUSTRY FY 2021* Q1 % of Q2
% of Q3 % of Q4 % of
FY2021 % of 6/30/20 Total
9/30/20 Total 12/31/20 Total
3/31/21 Total Total Refining
$
2.7
16%
$
10.3
37%
$
16.5
60%
$
10.3
40%
$
39.7
41%
Chemical/ Petrochemical
$
8.0
48%
$
5.5
20%
$
4.8
18%
$
5.8
23%
$
24.0
24%
Defense
$
3.5
21%
$
9.4
34%
$
4.5
17%
$
6.5
25%
$
24.0
25%
Other Commercial
$
2.5
15%
$
2.8
10%
$
1.4
5%
$
3.1
12%
$
9.8
10%
Total
$
16.7
$
28.0
$
27.2
$
25.7
$
97.5
SALES BY REGION FY 2022* Q1 % of Q2
% of Q3 % of YTD % of
6/30/21 Total 9/30/21 Total
12/31/21 Total 12/31/21 Total United
States
$
13.9
69%
$
26.2
77%
$
24.7
86%
$
64.8
78%
Middle East
$
0.6
3%
$
1.0
3%
$
0.6
2%
$
2.2
3%
Asia
$
3.5
17%
$
5.5
16%
$
1.5
5%
$
10.5
13%
Other
$
2.2
11%
$
1.4
4%
$
2.0
7%
$
5.6
6%
Total
$
20.2
$
34.1
$
28.8
$
83.1
SALES BY REGION FY 2021* Q1 % of Q2
% of Q3 % of Q4 % of
FY2021 % of 6/30/20 Total
9/30/20 Total 12/31/20 Total
3/31/21 Total Total United States
$
9.4
56%
$
17.3
62%
$
10.7
39%
$
15.3
60%
$
52.7
54%
Middle East
$
0.4
3%
$
1.0
4%
$
0.8
3%
$
2.6
10%
$
4.8
5%
Asia
$
5.2
31%
$
4.5
16%
$
11.2
41%
$
4.7
18%
$
25.6
26%
Other
$
1.7
10%
$
5.2
18%
$
4.5
17%
$
3.1
12%
$
14.4
15%
Total
$
16.7
$
28.0
$
27.2
$
25.7
$
97.5
*Quarters may not sum to
year-to-date/total fiscal year due to rounding.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220207005871/en/
For more information: Jeffrey F. Glajch Vice President -
Finance and CFO Phone: (585) 343-2216 jglajch@graham-mfg.com
Deborah K. Pawlowski Kei Advisors LLC Phone: (716) 843-3908
dpawlowski@keiadvisors.com
Graham (NYSE:GHM)
Historical Stock Chart
From Sep 2024 to Oct 2024
Graham (NYSE:GHM)
Historical Stock Chart
From Oct 2023 to Oct 2024