HOUSTON, March 7, 2017 /PRNewswire/ -- NCI
Building Systems, Inc. (NYSE: NCS) ("NCI" or the "Company")
today reported financial results for the first fiscal quarter ended
January 29, 2017.
First Quarter 2017 Financial and Operational
Highlights:
- Sales rose 5.9% to $391.7
million, compared to $370.0
million in last year's first quarter, driven by an
improvement in underlying tonnage volumes and increased
pricing
- Gross profit for the quarter was $84.0
million or 21.4% of revenues compared to $89.7 million or 24.2% of revenues in the prior
year's first quarter
- Net income decreased to $2.0
million from $5.9 million in
last year's first quarter
- Net income per diluted common share was $0.03 compared to $0.08 in the prior year first quarter. Adjusted
Net Income was $0.05 per diluted
common share compared to $0.07 in
last year's first quarter
- Adjusted EBITDA was $26.2 million
or 6.7% of revenue for the period compared to the prior year's
first quarter Adjusted EBITDA of $29.1
million or 7.9% of revenue
- Total consolidated backlog increased to $527.1 million, up 10.3% year-over-year
Norman C. Chambers, Chairman and
Chief Executive Officer, commented, "We are pleased with our first
quarter results, which were higher than the guidance we provided
due to stronger demand in our Coaters and Components businesses, as
well as commercial discipline in an environment of increasing input
costs. We continue to be encouraged by the strength of our
internal economic indicators, steel pricing trends and, most
importantly, the year-over-year growth in our bookings and backlog,
both of which are being driven by increased demand for our legacy
and insulated metal panel products. Looking ahead, we anticipate
that the growth in all our businesses during the second quarter
will strengthen the first half of the year and allow us to achieve
our top and bottom line financial targets for 2017."
First Quarter 2017 Results
First quarter 2017 sales increased to $391.7 million, or 5.9%, from $370.0 million in last year's first quarter, due
to an increase in tonnage volumes, most notably in the Coaters and
Components segments, as well as continued commercial discipline in
passing through rising steel prices.
Gross profit decreased 6.4% to $84.0
million from $89.7 million in
the first quarter of 2016 and gross profit margin contracted 280
basis points to 21.4%, compared to 24.2% in the prior year period.
The decline in margin was driven primarily by a combination of
rapidly rising steel input costs (versus rapidly declining input
costs in the prior year period) combined with a less favorable
product mix in the Components segment, where cold storage
represented the largest part of the insulated metal panels (IMP)
sales for the period and an IMP manufacturing facility was off line
for scheduled improvements. Additionally in the first quarter of
2016 as previously reported, NCI recorded a $0.7 million gain on the sale of an asset.
Steel input costs, which can impact any given quarter due to the
timing of steel cost changes, historically do not impact gross
margins when viewed from a broader full year perspective. The
Company passes on steel cost increases.
Engineering, selling, general and administrative (ESG&A)
expenses decreased to $69.0 million
from $69.9 million in the first
quarter of 2016 as a result of lower year-over-year incentive
compensation and cost reduction initiatives. As a percentage
of revenues, ESG&A expenses decreased approximately 130 basis
points to 17.6% in the 2017 first quarter compared to 18.9% in the
prior year's period.
Operating income decreased to $9.9
million compared to $15.3
million in the prior year's first quarter. Adjusted
operating income, a non-GAAP measure which excludes identified
special items, decreased to $12.5
million in the current quarter from $16.7 million in the first quarter of 2016.
First quarter 2017 net income applicable to common shares was
$2.0 million, or $0.03 per diluted common share compared to the
prior year's $5.8 million, or
$0.08 per diluted common share. Net
income was impacted by the following special items: $2.3 million of restructuring and impairment
charges; and $0.4 million of
strategic development and acquisition integration costs which were
offset by $ 1.0 million from the
related tax effect. Excluding the impact of these special items,
the Company reported adjusted net income applicable to common
shares, a non-GAAP measure, of $3.6
million, or $0.05 per diluted
common share, compared to $4.9
million, or $0.07 per diluted
common share, in the first quarter of 2016.
Adjusted EBITDA, a non-GAAP measure, defined in accordance with
the Company's Credit Agreement as earnings before interest, taxes,
depreciation and amortization, and cash and other non-cash items,
was $26.2 million, down 10.1% from
$29.1 million in the prior year's
first quarter.
Please see the reconciliation of Adjusted Operating Income,
Adjusted Net Income and Adjusted EBITDA in the accompanying
financial tables.
Cash and cash equivalents at quarter's end was $15.8 million compared to $73.8 million in the comparable period in fiscal
2016 and declined sequentially from $65.4 million at the end of the fourth
quarter of fiscal 2016 as a result of a substantial investment in
inventory ahead of rising steel costs. The Company paid down an
additional $10 million under its term
loan in the first quarter of fiscal 2017, the ninth consecutive
quarter of debt repayment. Additionally, the Company utilized
$3.5 million to repurchase 0.2
million shares during the quarter at an average purchase price of
$14.18 per share. NCI's net debt
leverage ratio at the end of the first fiscal quarter was 2.3x
compared to 2.0x at the end of the fourth quarter of 2016. In
addition, the Company's $150.0
million ABL facility remained undrawn as of January 29, 2017.
First Quarter 2017 Segment Performance
Third party sales in the Buildings group decreased 0.6% to
$145.0 million in the first quarter
from $146.0 million in the prior year
quarter, primarily as a result of the slowdown in business activity
prior to the November election. Operating income was $6.5 million for the quarter compared to
$12.5 million in the first quarter of
2016. Adjusted operating income decreased to $8.4 million in the current quarter, compared to
$12.2 million in the first quarter of
fiscal 2016. The decrease in the segment's operating margins
relates primarily to steep increases in steel prices for the period
compared to the first quarter of 2016 where steel prices were in a
steeply declining market.
The Components group generated $219.0
million in third-party sales during the quarter, an increase
of 7.9% from $202.9 million in the
first quarter of fiscal 2016, led by growth in the IMP product
lines, as well as continued strength in the legacy metal component
products. Operating income was $16.0
million for the quarter compared to $16.1 million in the first quarter of 2016.
Adjusted operating income decreased to $16.3
million from $16.8 million in
the same quarter last fiscal year. The Components segment's
profitability benefited from good volume growth and commercial
discipline during the period, offset by a predominance of cold
storage in the product mix for IMP and an IMP plant being off line
for planned improvements.
Third party sales in the Coatings group were $27.7 million, a 31.0% increase from $21.2 million in last year's first
quarter. Operating income increased 8.8% to $5.2 million in the first quarter of fiscal 2017,
compared to $4.8 million reported in
the same period last year. Operating margins in the Coatings group
were lower than the prior year primarily due to the intercompany
product mix and the insourcing of intercompany processing
activities that were incremental, but at lower margins.
Market Commentary
The leading indicators that NCI follows and that typically have
the most meaningful correlation to nonresidential low-rise
construction starts are the American Institute of Architects'
("AIA") Architecture Mixed Use Index, Dodge Residential single
family starts and the Conference Board Leading Economic Index
("LEI"). Historically, there has been a very high correlation to
the Dodge low-rise nonresidential starts when the three leading
indicators are combined and then seasonally adjusted. The combined
forward projection of these metrics, based on a 9 to 14-month
historical lag for each metric, indicates an expected positive
growth of 3.0% - 6.0% for low-rise new construction starts in
fiscal 2017, with the majority of that growth occurring in the
second half of the Company's fiscal year.
Current market data from internal bookings shows improvements in
a majority of NCI's primary markets, including agriculture,
commercial, industrial and institutional. In particular, commercial
and manufacturing warehousing, office and banks, hangars,
residential and governmental buildings have shown year-over-year
positive growth. Overall, a majority of NCI's geographic markets
demonstrated year-over-year growth with South Atlantic and East
North Central being particularly strong during the quarter.
Outlook and Guidance
For the full year, NCI continues to expect 2017 to be a better
year than 2016 in terms of revenues and Adjusted EBITDA, driven
primarily by the Company's ability to leverage expected market
growth, its ongoing cost savings initiatives and opportunities to
expand the IMP product lines. The Company's two on-going cost
savings initiatives in manufacturing consolidation and ESG&A
are expected to generate $30 to $40
million in cost savings by the end of 2018. During fiscal
2017, these two initiatives are anticipated to generate an
incremental $10.0 million in cost
savings.
Similar to past years' seasonal trends, the Company expects the
second half performance in 2017 to be stronger than the first half.
For the second quarter of fiscal 2017, NCI expects revenues to be
in the range of $400 to $425 million
and gross profit margins to be in the range of 22.5% to 24.5%. For
the full year fiscal 2017, the Company continues to expect revenues
to be in the range of $1.75 to $1.85
billion and Adjusted EBITDA to be in the range of
$175.0 to $205.0 million.
The Company has provided additional detailed financial guidance
in the quarterly supplemental presentation at
www.ncibuildingsystems.com under the "Investors" section.
Conference Call Information
The NCI Building Systems, Inc. first quarter 2017 conference
call is scheduled for Wednesday, March 8,
2017, at 9:00 a.m. ET
(8:00 a.m. CT). Please dial
1-412-902-0003 or 1-877-407-0672 (toll-free) to participate in the
call. To listen to a live broadcast of the call over the Internet
or to review the archived call, please visit the Company's website
at www.ncibuildingsystems.com. To access the taped telephone
replay, please dial 1-201-612-7415 or 1-877-660-6853 (toll-free)
and the passcode 13654040# when prompted. The taped replay will be
available two hours after the call through March 22, 2017. A replay of the webcast will be
available on the Company's website under the Event Calendar, Calls
& Webcast section of the Investor Relations page of the NCI
website for approximately 90 days.
About NCI Building Systems
NCI Building Systems, Inc. is one of North America's largest integrated
manufacturers of metal products for the nonresidential building
industry. NCI is comprised of a family of companies operating
manufacturing facilities across the
United States, Canada,
Mexico and China with additional sales and distribution
offices throughout the United
States and Canada. For more
information visit www.ncibuildingsystems.com.
Contact:
K. Darcey Matthews
Vice President, Investor Relations
281-897-7785
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Words such as "believe," "anticipate," "guidance," "plan,"
"potential," "expect," "should," "will," "forecast" and similar
expressions are forward-looking statements within the meaning of
the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. These forward-looking statements reflect our
current expectations, assumptions and/or beliefs concerning future
events. As a result, these forward-looking statements rely on a
number of assumptions, forecasts, and estimates and, therefore,
these forward-looking statements 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. Such
forward-looking statements include, but are not limited to, the
Company's belief that the growth in all its businesses during the
second quarter will strengthen the first half of the year and allow
the Company to achieve its top and bottom line financial targets
for 2017, the Company's expectation of a 3.0% - 6.0% year-over-year
increase in low-rise nonresidential new construction starts in
fiscal 2017, with the majority of that growth occurring in the
second half of the Company's fiscal year, the Company's expectation
of year-over-year improvement in revenue and Adjusted EBITDA, the
Company's belief that its two key cost initiatives in manufacturing
consolidation and ESG&A are expected to generate $10 million in cost savings in fiscal 2017, and
between $30 to $40 million in cost
savings by the end of fiscal 2018, the Company's expectation that
the second half performance in fiscal 2017 will be stronger than
the first half, the Company's expectation that for second quarter
fiscal 2017, NCI expects revenues to be in the range of
$400 to $425 million and gross profit
margins to be in the range of 22.5% to 24.5%, and the Company's
expectation that for the full year fiscal 2017, the Company expects
revenues to be in the range of $1.75 to
$1.85 billion and Adjusted EBITDA to be in the range of
$175 to $205 million. 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; our ability to carry out our restructuring plans and
to fully realize the expected cost savings, 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 October 30, 2016, 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.
NCI BUILDING
SYSTEMS, INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(In
thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Three
Months Ended
|
|
|
January
29,
|
|
January
31,
|
|
|
2017
|
|
2016
|
|
|
|
|
|
Sales
|
|
$
391,703
|
|
$
370,014
|
Cost of
sales
|
|
307,752
|
|
281,023
|
Gain on sale of
assets and asset recovery
|
|
-
|
|
(725)
|
Gross
profit
|
|
83,951
|
|
89,716
|
|
|
21.4%
|
|
24.2%
|
|
|
|
|
|
Engineering,
selling, general and administrative expenses
|
|
69,039
|
|
69,850
|
Intangible
asset amortization
|
|
2,405
|
|
2,416
|
Strategic
development and acquisition related costs
|
|
357
|
|
681
|
Restructuring
and impairment charges
|
|
2,264
|
|
1,510
|
Income from
operations
|
|
9,886
|
|
15,259
|
|
|
|
|
|
Gain from
bargain purchase
|
|
-
|
|
1,864
|
Interest
income
|
|
5
|
|
22
|
Interest
expense
|
|
(6,886)
|
|
(7,869)
|
Foreign
exchange loss
|
|
(78)
|
|
(742)
|
Other income
(expense), net
|
|
387
|
|
(189)
|
|
|
|
|
|
Income before
income taxes
|
|
3,314
|
|
8,345
|
Provision for
income taxes
|
|
1,275
|
|
2,453
|
|
|
38.5%
|
|
29.4%
|
|
|
|
|
|
Net
income
|
|
$
2,039
|
|
$
5,892
|
|
|
|
|
|
Net income
allocated to participating securities
|
|
(8)
|
|
(57)
|
|
|
|
|
|
Net income
applicable to common shares
|
|
$
2,031
|
|
$
5,835
|
|
|
|
|
|
Income per
common share:
|
|
|
|
|
Basic
|
|
$
0.03
|
|
$
0.08
|
Diluted
|
|
$
0.03
|
|
$
0.08
|
|
|
|
|
|
Weighted
average number of common shares outstanding:
|
|
|
|
|
Basic
|
|
70,875
|
|
73,261
|
Diluted
|
|
71,088
|
|
73,771
|
|
|
|
|
|
Increase in
sales
|
|
5.9%
|
|
14.6%
|
|
|
|
|
|
Engineering, selling,
general and administrative expenses percentage
|
|
17.6%
|
|
18.9%
|
NCI BUILDING
SYSTEMS, INC.
|
CONSOLIDATED
BALANCE SHEETS
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January
29,
|
|
October
30,
|
|
|
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
$
15,789
|
|
$
65,403
|
|
Restricted
cash
|
|
|
192
|
|
310
|
|
Accounts
receivable, net
|
|
|
161,492
|
|
182,258
|
|
Inventories,
net
|
|
|
191,756
|
|
186,824
|
|
Income taxes
receivable
|
|
|
7,758
|
|
982
|
|
Deferred income
taxes
|
|
|
25,987
|
|
29,104
|
|
Investments in
debt and equity securities, at market
|
|
5,916
|
|
5,748
|
|
Prepaid
expenses and other
|
|
|
27,007
|
|
29,971
|
|
Assets held for
sale
|
|
|
4,256
|
|
4,256
|
|
|
Total current
assets
|
|
440,153
|
|
504,856
|
|
|
|
|
|
|
|
|
Property, plant
and equipment, net
|
|
|
238,581
|
|
242,212
|
|
Goodwill
|
|
|
154,291
|
|
154,271
|
|
Intangible
assets, net
|
|
|
144,363
|
|
146,769
|
|
Other assets,
net
|
|
|
2,022
|
|
2,092
|
|
|
Total
assets
|
|
$
979,410
|
|
$
1,050,200
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Note
payable
|
|
|
$
29
|
|
$
460
|
|
Accounts
payable
|
|
|
112,714
|
|
142,913
|
|
Accrued
compensation and benefits
|
|
|
54,004
|
|
72,612
|
|
Accrued
interest
|
|
|
1,296
|
|
7,165
|
|
Other accrued
expenses
|
|
|
93,392
|
|
103,384
|
|
|
Total current
liabilities
|
|
261,435
|
|
326,534
|
|
|
|
|
|
|
|
|
Long-term debt,
net of deferred financing costs of $7,719 and $8,096
on January 29, 2017 and October 30, 2016,
respectively
|
|
386,428
|
|
396,051
|
|
|
|
|
|
|
|
|
Deferred income
taxes
|
|
|
26,970
|
|
24,804
|
|
Other long-term
liabilities
|
|
|
21,481
|
|
21,494
|
|
|
Total long-term
liabilities
|
|
434,879
|
|
442,349
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common
stock
|
|
|
712
|
|
715
|
|
Additional
paid-in capital
|
|
|
595,794
|
|
603,120
|
|
Accumulated
deficit
|
|
|
(300,667)
|
|
(302,706)
|
|
Accumulated
other comprehensive loss, net
|
|
(10,467)
|
|
(10,553)
|
|
Treasury stock,
at cost
|
|
|
(2,276)
|
|
(9,259)
|
|
|
Total
stockholders' equity
|
|
283,096
|
|
281,317
|
|
|
|
|
|
|
|
|
|
Total
liabilities and stockholders' equity
|
|
$
979,410
|
|
$
1,050,200
|
NCI BUILDING
SYSTEMS, INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Three
Months Ended
|
|
|
January
29,
|
|
January
31,
|
|
|
2017
|
|
2016
|
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
Net
income
|
|
$
2,039
|
|
$
5,892
|
Adjustments to
reconcile net income to net cash used in
|
|
|
|
|
operating
activities:
|
|
|
|
|
Depreciation and amortization
|
|
10,315
|
|
10,747
|
Amortization of deferred financing costs
|
|
477
|
|
477
|
Share-based compensation expense
|
|
3,042
|
|
2,582
|
(Gains) losses on assets, net
|
|
125
|
|
(2,589)
|
Provision for doubtful accounts
|
|
1,586
|
|
1,467
|
Provision for deferred income taxes
|
|
26
|
|
1,992
|
Excess tax (benefits) shortfalls from share-based compensation
arrangements
|
|
(1,515)
|
|
261
|
Changes in operating
assets and liabilities, net of effect of acquisitions:
|
|
|
|
|
Accounts receivable
|
|
19,181
|
|
23,669
|
Inventories
|
|
(4,932)
|
|
7,469
|
Income taxes receivable
|
|
(6,777)
|
|
-
|
Prepaid expenses and other
|
|
2,157
|
|
1,899
|
Accounts payable
|
|
(30,199)
|
|
(35,619)
|
Accrued expenses
|
|
(27,240)
|
|
(22,100)
|
Other, net
|
|
(163)
|
|
(347)
|
|
|
|
|
|
Net cash used in
operating activities
|
|
(31,878)
|
|
(4,200)
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
Acquisitions, net of
cash acquired
|
|
-
|
|
(3,071)
|
Capital
expenditures
|
|
(4,120)
|
|
(5,772)
|
Proceeds from sale of
property, plant and equipment
|
|
-
|
|
3,066
|
|
|
|
|
|
Net cash used in
investing activities
|
|
(4,120)
|
|
(5,777)
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
Refund (deposit) of
restricted cash
|
|
117
|
|
(93)
|
Proceeds from stock
options exercised
|
|
1,019
|
|
-
|
Proceeds from Amended
ABL facility
|
|
30,000
|
|
-
|
Payments on Amended
ABL facility
|
|
(30,000)
|
|
-
|
Payments on term
loan
|
|
(10,000)
|
|
(10,000)
|
Payments on note
payable
|
|
(431)
|
|
(514)
|
Excess tax benefits
(shortfalls) from share-based compensation arrangements
|
|
1,515
|
|
(261)
|
Purchases of treasury
stock
|
|
(5,922)
|
|
(4,627)
|
|
|
|
|
|
Net cash used in
financing activities
|
|
(13,702)
|
|
(15,495)
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
86
|
|
(341)
|
Net decrease in cash
and cash equivalents
|
|
(49,614)
|
|
(25,813)
|
|
|
|
|
|
Cash and cash
equivalents at beginning of period
|
|
65,403
|
|
99,662
|
|
|
|
|
|
Cash and cash
equivalents at end of period
|
|
$
15,789
|
|
$
73,849
|
NCI Building
Systems, Inc
|
Business
Segments
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Three
Months Ended
|
|
Fiscal Three
Months Ended
|
|
$
|
%
|
|
|
January 29,
2017
|
|
January 31,
2016
|
|
Inc/(Dec)
|
Change
|
|
|
|
% of
|
|
|
% of
|
|
|
|
|
|
|
Total
|
|
|
Total
|
|
|
|
Sales:
|
|
|
Sales
|
|
|
Sales
|
|
|
|
Engineered building
systems
|
|
$
151,263
|
33
|
|
$ 148,975
|
34
|
|
$
2,288
|
1.5%
|
Metal components
|
245,300
|
53
|
|
230,456
|
54
|
|
14,844
|
6.4%
|
Metal coil
coating
|
|
64,202
|
14
|
|
51,206
|
12
|
|
12,996
|
25.4%
|
Total sales
|
460,765
|
100
|
|
430,637
|
100
|
|
30,128
|
7.0%
|
Less: Intersegment
sales
|
|
69,062
|
15
|
|
60,623
|
14
|
|
8,439
|
13.9%
|
Total net sales
|
|
$
391,703
|
85
|
|
$ 370,014
|
86
|
|
$ 21,689
|
5.9%
|
|
|
0.00
|
|
|
0
|
|
|
|
|
|
|
|
% of
|
|
|
% of
|
|
|
|
Operating income
(loss):
|
|
|
Sales
|
|
|
Sales
|
|
|
|
Engineered building
systems
|
|
$
6,503
|
4
|
|
$
12,462
|
8
|
|
$
(5,959)
|
-47.8%
|
Metal components
|
16,030
|
7
|
|
16,104
|
7
|
|
(74)
|
-0.5%
|
Metal coil
coating
|
|
5,244
|
8
|
|
4,819
|
9
|
|
425
|
8.8%
|
Corporate
|
(17,891)
|
-
|
|
(18,126)
|
-
|
#
|
235
|
1.3%
|
Total operating income (% of sales)
|
|
$
9,886
|
3
|
|
$
15,259
|
4
|
|
$
(5,373)
|
-35.2%
|
|
|
0
|
|
|
-
|
|
|
|
|
|
|
|
% of
|
|
|
% of
|
|
|
|
Adjusted operating
income (loss) (1):
|
|
|
Sales
|
|
|
Sales
|
|
|
|
Engineered building
systems
|
|
$
8,413
|
6
|
|
$
12,237
|
8
|
|
$
(3,824)
|
-31.2%
|
Metal components
|
16,335
|
7
|
|
16,755
|
7
|
|
(420)
|
-2.5%
|
Metal coil
coating
|
|
5,244
|
8
|
|
4,819
|
9
|
|
425
|
8.8%
|
Corporate
|
(17,485)
|
-
|
|
(17,086)
|
-
|
|
(399)
|
-2.3%
|
Total adjusted operating income (% of sales)
|
|
$
12,507
|
3
|
|
$
16,725
|
5
|
|
$
(4,218)
|
-25.2%
|
|
|
(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. See the reconciliation of Adjusted operating income
(loss) to operating income (loss) on the following
page.
|
NCI BUILDING
SYSTEMS, INC.
|
BUSINESS
SEGMENTS
|
NON-GAAP FINANCIAL
MEASURES AND RECONCILIATIONS
|
RECONCILIATION OF
OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS)
EXCLUDING SPECIAL CHARGES
|
FISCAL THREE
MONTHS ENDED JANUARY 29, 2017 AND JANUARY 31, 2016
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Three
Months Ended January 29, 2017
|
|
|
|
Engineered
Building
Systems
|
|
Metal
Components
|
|
Metal
Coil
Coating
|
|
Corporate
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss), GAAP basis
|
|
$
6,503
|
|
$
16,030
|
|
$
5,244
|
|
$
(17,891)
|
|
$
9,886
|
|
Restructuring and
impairment charges
|
|
1,910
|
|
305
|
|
-
|
|
49
|
|
2,264
|
|
Strategic development
and acquisition related costs
|
|
-
|
|
-
|
|
-
|
|
357
|
|
357
|
|
Adjusted operating
income (loss) (1)
|
|
$
8,413
|
|
$
16,335
|
|
$
5,244
|
|
$
(17,485)
|
|
$
12,507
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal Three
Months Ended January 31, 2016
|
|
|
|
Engineered
Building
Systems
|
|
Metal
Components
|
|
Metal
Coil
Coating
|
|
Corporate
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss), GAAP basis
|
|
$
12,462
|
|
$
16,104
|
|
$
4,819
|
|
$
(18,126)
|
|
$
15,259
|
|
Restructuring and
impairment charges
|
|
500
|
|
285
|
|
-
|
|
725
|
|
1,510
|
|
Strategic development
and acquisition related costs
|
|
-
|
|
366
|
|
-
|
|
315
|
|
681
|
|
(Gain) on sale of
assets and asset recovery
|
|
(725)
|
|
-
|
|
-
|
|
-
|
|
(725)
|
|
Adjusted operating
income (loss) (1)
|
|
$
12,237
|
|
$
16,755
|
|
$
4,819
|
|
$
(17,086)
|
|
$
16,725
|
|
|
(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.
|
NCI BUILDING
SYSTEMS, INC.
|
NON-GAAP FINANCIAL
MEASURES AND RECONCILIATIONS
|
COMPUTATION OF
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION,
|
AMORTIZATION AND
OTHER NONCASH ITEMS (ADJUSTED EBITDA)
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2nd
Qtr
|
|
3rd
Qtr
|
|
4th
Qtr
|
|
1st
Qtr
|
|
Trailing 12
Months
|
|
|
May
1,
|
|
July
31,
|
|
October
30,
|
|
January
29,
|
|
January
29,
|
|
|
2016
|
|
2016
|
|
2016
|
|
2017
|
|
2017
|
Net
income
|
|
$
2,420
|
|
$
23,715
|
|
$
19,001
|
|
$
2,039
|
|
$
47,175
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
10,765
|
|
10,595
|
|
9,817
|
|
10,315
|
|
41,492
|
Consolidated interest
expense, net
|
|
7,792
|
|
7,685
|
|
7,548
|
|
6,881
|
|
29,906
|
Provision for income
taxes
|
|
1,209
|
|
11,627
|
|
12,649
|
|
1,275
|
|
26,760
|
Restructuring and impairment
charges
|
|
1,149
|
|
778
|
|
815
|
|
2,264
|
|
5,006
|
Strategic development and
acquisition related costs
|
|
579
|
|
819
|
|
590
|
|
357
|
|
2,345
|
Share-based
compensation
|
|
2,468
|
|
2,661
|
|
3,181
|
|
3,042
|
|
11,352
|
(Gain) loss on sale of
assets and asset recovery
|
|
(927)
|
|
(52)
|
|
62
|
|
-
|
|
(917)
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDA(1)
|
|
$
25,455
|
|
$
57,828
|
|
$
53,663
|
|
$
26,173
|
|
$
163,119
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2nd
Qtr
|
|
3rd
Qtr
|
|
4th
Qtr
|
|
1st
Qtr
|
|
Trailing 12
Months
|
|
|
May
3,
|
|
August
2,
|
|
November
1,
|
|
January
31,
|
|
January
31,
|
|
|
2015
|
|
2015
|
|
2015
|
|
2016
|
|
2016
|
Net income
(loss)
|
|
$
(7,489)
|
|
$
7,220
|
|
$
18,407
|
|
$
5,892
|
|
$
24,030
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
13,766
|
|
14,541
|
|
13,354
|
|
10,747
|
|
52,408
|
Consolidated interest
expense, net
|
|
8,280
|
|
8,135
|
|
7,993
|
|
7,847
|
|
32,255
|
Provision (benefit) for
income taxes
|
|
(4,087)
|
|
3,520
|
|
10,029
|
|
2,453
|
|
11,915
|
Restructuring and impairment
charges
|
|
1,714
|
|
504
|
|
7,611
|
|
1,510
|
|
11,339
|
(Gain) from bargain
purchase
|
|
-
|
|
-
|
|
-
|
|
(1,864)
|
|
(1,864)
|
Strategic development and
acquisition related costs
|
|
628
|
|
701
|
|
1,143
|
|
681
|
|
3,153
|
(Gain) on legal
settlements
|
|
-
|
|
-
|
|
(3,765)
|
|
-
|
|
(3,765)
|
Fair value adjustment of
acquired inventory
|
|
775
|
|
1,000
|
|
-
|
|
-
|
|
1,775
|
Share-based
compensation
|
|
2,201
|
|
2,568
|
|
1,677
|
|
2,582
|
|
9,028
|
(Gain) on sale of assets and
asset recovery
|
|
-
|
|
-
|
|
-
|
|
(725)
|
|
(725)
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
(1)
|
|
$
15,788
|
|
$
38,189
|
|
$
56,449
|
|
$
29,123
|
|
$
139,549
|
|
|
|
|
(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 special 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.
|
NCI BUILDING
SYSTEMS, INC.
|
NON-GAAP FINANCIAL
MEASURES AND RECONCILIATIONS
|
ADJUSTED NET
INCOME PER DILUTED COMMON SHARE AND NET INCOME (LOSS)
COMPARISON
|
(Unaudited)
|
|
|
|
|
|
|
Fiscal Three
Months Ended
|
|
|
January
29,
|
January
31,
|
|
|
2017
|
2016
|
|
Net income per
diluted common share, GAAP basis
|
$
0.03
|
$
0.08
|
|
Restructuring and
impairment charges
|
0.03
|
0.02
|
|
Strategic development
and acquisition related costs
|
0.00
|
0.01
|
|
(Gain) on sale of
assets and asset recovery
|
-
|
(0.01)
|
|
(Gain) from bargain
purchase
|
-
|
(0.03)
|
|
Tax effect of
applicable non-GAAP adjustments (2)
|
(0.01)
|
(0.01)
|
|
Adjusted net income
per diluted common share (1)
|
$
0.05
|
$
0.07
|
|
|
|
|
|
|
|
|
|
|
Fiscal Three
Months Ended
|
|
|
January
29,
|
January
31,
|
|
|
2017
|
2016
|
|
Net income applicable
to common shares, GAAP basis
|
$
2,031
|
$
5,835
|
|
Restructuring and
impairment charges
|
2,264
|
1,510
|
|
Strategic development
and acquisition related costs
|
357
|
681
|
|
(Gain) on sale of
assets and asset recovery
|
-
|
(725)
|
|
(Gain) from bargain
purchase
|
-
|
(1,864)
|
|
Tax effect of
applicable non-GAAP adjustments (2)
|
(1,022)
|
(572)
|
|
Adjusted net income
applicable to common shares (1)
|
$
3,630
|
$
4,865
|
|
|
|
|
|
(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 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.
|
NCI Building
Systems, Inc.
|
Reconciliation of Segment Sales to Third
Party Segment Sales
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal
|
|
|
Fiscal
|
|
$
|
%
|
|
|
|
1st Qtr
2017
|
|
|
1st Qtr
2016
|
|
Inc/(Dec)
|
Change
|
Engineered
Building Systems
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
$
151,263
|
33%
|
|
$
148,975
|
34%
|
$
2,288
|
1.5%
|
|
Less:
Intersegment sales
|
|
6,242
|
|
|
3,025
|
|
3,217
|
106.3%
|
|
Third Party
Sales
|
|
$
145,021
|
37%
|
|
$
145,950
|
39%
|
$
(929)
|
-0.6%
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income
|
|
$
6,503
|
4%
|
|
$
12,462
|
9%
|
$
(5,959)
|
-47.8%
|
|
|
|
(0)
|
|
|
-
|
|
|
|
Metal
Components
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
$
245,300
|
53%
|
|
$
230,456
|
54%
|
$
14,844
|
6.4%
|
|
Less:
Intersegment sales
|
|
26,341
|
|
|
27,555
|
|
(1,214)
|
-4.4%
|
|
Third Party
Sales
|
|
$
218,959
|
56%
|
|
$
202,901
|
55%
|
$
16,058
|
7.9%
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income
|
|
$
16,030
|
7%
|
|
$
16,104
|
8%
|
$
(74)
|
-0.5%
|
|
|
|
(0)
|
|
|
-
|
|
|
|
Metal Coil
Coating
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
$
64,202
|
14%
|
|
$
51,206
|
12%
|
$
12,996
|
25.4%
|
|
Less:
Intersegment sales
|
|
36,479
|
|
|
30,043
|
|
6,436
|
21.4%
|
|
Third Party
Sales
|
|
$
27,723
|
7%
|
|
$
21,163
|
6%
|
$
6,560
|
31.0%
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income
|
|
$
5,244
|
19%
|
|
$
4,819
|
23%
|
$
425
|
8.8%
|
|
|
|
0
|
|
|
-
|
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
$
460,765
|
100%
|
|
$
430,637
|
100%
|
$
30,128
|
7.0%
|
|
Less:
Intersegment
|
|
69,062
|
|
|
60,623
|
|
8,439
|
13.9%
|
|
Third Party
Sales
|
|
$
391,703
|
100%
|
|
$
370,014
|
100%
|
$
21,689
|
5.9%
|
|
|
|
-
|
|
|
-
|
|
|
|
|
Operating
Income
|
|
$
9,886
|
3%
|
|
$
15,259
|
4%
|
$
(5,373)
|
-35.2%
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/nci-building-systems-reports-first-quarter-2017-results-300419726.html
SOURCE NCI Building Systems, Inc.