Net sales of $214.0 million, decrease of
27.2 percent organically
Second-quarter GAAP net income of $14.3
million, or $0.77 diluted earnings per share; adjusted diluted EPS
of $0.96 per share
Adjusted EBITDA of $35.3 million, or 16.5
percent of sales
Strong cash and liquidity position
Tennant Company (“Tennant”) (NYSE: TNC), a world leader in the
design, manufacture and marketing of solutions that help create a
cleaner, safer and healthier world, today reported second-quarter
results for 2020. For the second quarter, net sales totaled $214.0
million, representing a year-over-year decrease of 28.6 percent, or
down 27.2 percent on an organic basis, primarily due to the
coronavirus pandemic and resulting global business slowdown. Net
income for the second quarter of 2020 was $14.3 million, or $0.77
per diluted share, compared with $14.8 million, or $0.81 per
diluted share, in the year-ago period. Adjusted diluted earnings
per share, which exclude certain non-operational items and
amortization expense, were $0.96, compared with $1.35 in the second
quarter of 2019. Excluding non-operational items, adjusted earnings
before interest, taxes, depreciation and amortization (EBITDA) for
the second quarter of 2020 were $35.3 million, or 16.5 percent of
sales, compared with $41.8 million, or 13.9 percent of sales, in
the year-ago period. In the second quarter of 2020, cash flow from
operations provided $39.8 million, compared to $22.5 million in the
prior-year second quarter. (See the Supplemental Non-GAAP Financial
Table.)
“In the second quarter, we honored our 150-year commitment to
providing the equipment, parts and service our customers need to
keep their facilities clean and safe,” said Chris Killingstad,
Tennant Company’s president and chief executive officer. “While
revenue was down year-over-year in the quarter, we are encouraged
with the trend we saw in the quarter as the decline in revenue was
significantly less in June than in the earlier months of the
quarter. At the same time, we took certain actions to manage our
costs and cash flow carefully, while preserving our ability to ramp
up quickly when global markets recover. While our profitability
measures for the second quarter reflect some considerable cost
savings that we do not expect will repeat in subsequent quarters,
they are consistent with our overall commitment to successfully
manage through this period of uncertainty. Tennant is a resilient
company that will emerge from this health crisis in a strong
position and I am proud of the way our team members have responded
with determination, dedication and resourcefulness to the
unprecedented challenges of the ongoing pandemic.”
Second-Quarter Operating
Review
“The health and safety of our employees, customers and business
partners are always our top priority,” said Killingstad. “In the
second quarter, we took a number of actions globally in response to
the pandemic to minimize its financial impact and to preserve our
operational flexibility as we plan for the future.”
In the second quarter, the Company implemented a combination of
reduced work schedules and furlough programs for employees
globally, consistent with applicable laws and regulations. These
actions also included pay reductions for our senior executives and
the board of directors within the quarter. Additionally, Tennant
reduced management incentives, limited travel to business-critical
trips only, implemented work-from-home processes where possible,
reduced non-essential discretionary and project spending, and
participated in government programs, where appropriate, that
benefited our EBITDA results. In total, a number of these actions
resulted in approximately $15 million of cost savings that are not
expected to repeat in subsequent quarters.
Sales Highlights
Tennant’s second-quarter 2020 consolidated net sales of $214.0
million were down 28.6 percent over the same period last year,
including a 1.4 percent reduction from foreign currency. On an
organic basis, sales declined 27.2 percent, reflecting an improved
trend in June compared to earlier months in the quarter.
Regional Sales Highlights
- Americas – Sales in the Americas declined 28.1 percent, or down
27.0 percent organically, with overall declines across North and
Latin America, due to the pandemic, which offset continued strength
for Tennant’s autonomous cleaning machines in North America.
- EMEA – Sales in the Europe, Middle East and Africa (EMEA)
region were down 32.3 percent, or 30.2 percent organically,
primarily due to the broad economic impact of the pandemic across
the entire region. Shutdowns of customer facilities were widespread
in the second quarter.
- APAC – Sales in the Asia Pacific (APAC) region decreased 21.8
percent, or down 20.1 percent organically, primarily as a result of
significant decreases in sales in China, along with declines in
Japan and Southeast Asia, due to the pandemic.
Profitability Measures and Related Factors
(See the Supplemental Non-GAAP Financial Table)
- Gross margin – Gross margin in the second quarter of 2020 was
42.3 percent, compared with 40.3 percent in the year-ago period.
Adjusted gross margins during the second quarter of 2020 and 2019
were 42.3 percent and 41.4 percent, respectively, primarily
reflecting actions directly resulting from the Company’s enterprise
strategy efforts like pricing and cost-out initiatives, benefits
from government programs, and cost actions including employee
furloughs and reduced work hours.
- Net income/Adjusted EBITDA – Tennant’s 2020 second-quarter net
earnings and adjusted EBITDA decreased compared to the prior year
primarily as a result of lower sales due to the pandemic. Net
earnings decreased to $14.3 million, or $0.77 per diluted share,
compared with $14.8 million, or $0.81 per diluted share. Adjusted
earnings per diluted share, excluding non-operational items and
amortization expense, were $0.96 compared with $1.35 in the
year-ago period. Adjusted EBITDA in the second quarter of 2020
decreased to $35.3 million, or 16.5 percent of sales, compared with
$41.8 million, or 13.9 percent of sales, in the second quarter of
2019. The increase as a percentage of sales was attributed to cost
savings related to steps taken by the Company, including employee
furloughs and reduced work schedules, reduced expected management
incentives and proceeds from government programs that are not
likely to repeat.
Cash Flow, Capital Allocation and
Liquidity
During the second quarter of 2020, Tennant generated $39.8
million in cash flow from operations, primarily driven by business
performance. Also in the second quarter, the Company repaid the
$125 million it had previously drawn as a precaution from its $200
million revolver. As of June 30, 2020, the Company had $99.3
million in cash and cash equivalents, and approximately $157
million of undrawn funds in its revolver.
2020 Business Outlook
As previously announced, Tennant withdrew the full-year guidance
it had provided on February 20, 2020, due to the uncertain nature
of the ongoing pandemic. At this time, the Company cannot predict
the total impact on its businesses and financial results for the
remainder of fiscal 2020 but plans to share additional updates in
its third-quarter earnings announcement and conference call.
Conference Call
Tennant will host a conference call to discuss its 2020
second-quarter results today, July 30, 2020, at 10 a.m. Central
Time (11 a.m. Eastern Time). The conference call and accompanying
slides will be available via webcast on Tennant's investor website.
To listen to the call live and view the slide presentation, go to
investors.tennantco.com and click on the link at the bottom of the
home page. A recorded replay of the conference call, with
accompanying slides, will be available at
investors.tennantco.com.
Company Profile
Founded in 1870, Tennant Company (TNC), headquartered in
Minneapolis, Minnesota, is a world leader in designing,
manufacturing and marketing solutions that empower customers to
achieve quality cleaning performance, reduce their environmental
impact and help create a cleaner, safer, healthier world. Its
products include equipment for maintaining surfaces in industrial,
commercial and outdoor environments; detergent-free and other
sustainable cleaning technologies; cleaning tools and supplies; and
coatings for protecting, repairing and upgrading surfaces.
Tennant's global field service network is the most extensive in the
industry. Tennant Company had sales of $1.14 billion in 2019 and
has approximately 4,400 employees. Tennant has manufacturing
operations throughout the world and sells products directly in 15
countries and through distributors in more than 100 countries. For
more information, visit www.tennantco.com and www.ipcworldwide.com.
The Tennant Company logo and other trademarks designated with the
symbol “®” are trademarks of Tennant Company registered in the
United States and/or other countries.
Forward-Looking
Statements
Certain statements contained in this document are considered
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act. These statements do not relate to
strictly historical or current facts and provide current
expectations or forecasts of future events. Any such expectations
or forecasts of future events are subject to a variety of factors.
These include factors that affect all businesses operating in a
global market as well as matters specific to us and the markets we
serve. Particular risks and uncertainties presently facing us
include: uncertainty surrounding the impacts and duration of the
COVID-19 pandemic; our ability to effectively develop and manage
strategic planning and growth processes and the related operational
plans; our ability to successfully upgrade and evolve our
information technology systems; fluctuations in the cost, quality
or availability of raw materials and purchased components;
geopolitical and economic uncertainty throughout the world; our
ability to integrate acquisitions; our ability to attract, retain
and develop key personnel and create effective succession planning
strategies; our ability to successfully protect our information
technology systems from cybersecurity risks; our ability to develop
and commercialize new innovative products and services; the
competition in our business; the occurrence of a significant
business interruption; our ability to comply with global laws and
regulations; the potential disruption of our business from actions
of activist investors or others; unforeseen product liability
claims or product quality issues; our ability to generate
sufficient cash to satisfy our debt obligations; and foreign
currency fluctuations.
We caution that forward-looking statements must be considered
carefully and that actual results may differ in material ways due
to risks and uncertainties both known and unknown. Information
about factors that could materially affect our results can be found
in our 2019 Form 10-K. Shareholders, potential investors and other
readers are urged to consider these factors in evaluating
forward-looking statements and are cautioned not to place undue
reliance on such forward-looking statements.
We undertake no obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise, except as required by law. Investors
are advised to consult any further disclosures by us in our filings
with the Securities and Exchange Commission and in other written
statements on related subjects. It is not possible to anticipate or
foresee all risk factors, and investors should not consider any
list of such factors to be an exhaustive or complete list of all
risks or uncertainties.
Non-GAAP Financial
Measures
This news release and the related conference call include
presentation of Non-GAAP measures that include or exclude special
items of a nonrecurring and/or non-operational nature (hereinafter
referred to as “special items”). Management believes that the
Non-GAAP measures provide useful information to investors regarding
the Company’s results of operations and financial condition because
they permit a more meaningful comparison and understanding of
Tennant Company’s operating performance for the current, past or
future periods. Management uses these Non-GAAP measures to monitor
and evaluate ongoing operating results and trends and to gain an
understanding of the comparative operating performance of the
Company.
We believe that disclosing Gross Profit – as adjusted, Gross
Margin – as adjusted, Selling and Administrative Expense – as
adjusted, Selling and Administrative Expense as a percent of Net
Sales – as adjusted, Profit from Operations – as adjusted,
Operating Margin – as adjusted, Profit Before Income Taxes – as
adjusted, Income Tax Expense – as adjusted, Net Earnings
Attributable to Tennant Company – as adjusted, Net Earnings
Attributable to Tennant Company per Share – as adjusted, Earnings
Before Interest, Taxes, Depreciation and Amortization (EBITDA) – as
adjusted, and EBITDA Margin – as adjusted (collectively, the
“Non-GAAP Measures”), excluding the impacts from special items, is
useful to investors as a measure of operating performance. We use
these as one measure to monitor and evaluate operating performance.
The Non-GAAP measures are financial measures that do not reflect
United States Generally Accepted Accounting Principles (GAAP).
We calculate Gross Profit – as adjusted and Gross Margin – as
adjusted by adding back the discontinuation of product lines. We
calculate Selling and Administrative Expense – as adjusted, and
Selling and Administrative Expense as a percent of Net Sales – as
adjusted by adding back acquisition and integration costs, certain
non-operational professional services, and restructuring charges
recorded in S&A. We calculate Profit from Operations – as
adjusted and Operating Margin – as adjusted by adding back the
pre-tax effect of the discontinuation of product lines, acquisition
and integration costs, certain non-operational professional
services, and restructuring charges. We calculate Profit Before
Income Taxes – as adjusted by adding back the pre-tax effect of the
discontinuation of product lines, acquisition and integration
costs, certain non-operational professional services, restructuring
charges, and amortization expense. We calculate Income Tax Expense
– as adjusted by adding back the tax effect of the discontinuation
of product lines, acquisition and integration costs, certain
non-operational professional services, restructuring charges and
amortization expense. We calculate Net Earnings Attributable to
Tennant Company – as adjusted by adding back the after-tax effect
of the discontinuation of product lines, acquisition and
integration costs, certain non-operational professional services,
restructuring charges, and amortization expense. We calculate Net
Earnings Attributable to Tennant Company per Share – as adjusted by
adding back the after-tax effect of the discontinuation of product
lines, acquisition and integration costs, certain non-operational
professional services, restructuring charges, and amortization
expense and dividing the result by the diluted weighted average
shares outstanding. We calculate EBITDA – as adjusted by adding
back the pre-tax effect of the discontinuation of product lines,
acquisition and integration costs, certain non-operational
professional services, restructuring charges, Interest Income,
Interest Expense, Income Tax Expense, Depreciation Expense and
Amortization Expense to Net Earnings Including Noncontrolling
Interest – as reported. We calculate EBITDA Margin – as adjusted by
dividing EBITDA – as adjusted by Net Sales.
Investors should consider these Non-GAAP financial measures in
addition to, not as a substitute for, or better than, financial
measures prepared in accordance with GAAP. Reconciliations of the
components of these measures to the most directly comparable GAAP
financial measures are included in the Supplemental Non-GAAP
Financial Table to this earnings release.
FINANCIAL TABLES FOLLOW
TENNANT COMPANY
CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(In millions, except shares and per share
data)
Three Months Ended
Six Months Ended
June 30, 2020
June 30, 2020
2020
2019
2020
2019
Net Sales
$
214.0
$
299.7
$
466.1
$
562.1
Cost of Sales
123.4
178.9
271.4
333.1
Gross Profit
90.6
120.8
194.7
229.0
Gross Margin
42.3
%
40.3
%
41.8
%
40.7
%
Operating Expense:
Research and Development Expense
6.6
8.4
14.0
15.6
Selling and Administrative Expense
61.1
92.5
143.4
182.7
Total Operating Expense
67.7
100.9
157.4
198.3
Profit from Operations
22.9
19.9
37.3
30.7
Operating Margin
10.7
%
6.6
%
8.0
%
5.5
%
Other Income (Expense):
Interest Income
0.8
0.9
1.7
1.7
Interest Expense
(5.6
)
(5.4
)
(10.7
)
(10.5
)
Net Foreign Currency Transaction Loss
—
(0.2
)
(4.1
)
—
Other (Expense) Income, Net
(0.2
)
1.4
—
1.3
Total Other Expense, Net
(5.0
)
(3.3
)
(13.1
)
(7.5
)
Profit Before Income Taxes
17.9
16.6
24.2
23.2
Income Tax Expense
3.6
1.8
4.7
3.0
Net Earnings Including Noncontrolling
Interest
14.3
14.8
19.5
20.2
Net Earnings Attributable to Tennant
Company
$
14.3
$
14.8
$
19.5
$
20.2
Net Earnings Attributable to Tennant
Company per Share:
Basic
$
0.78
$
0.82
$
1.06
$
1.12
Diluted
$
0.77
$
0.81
$
1.05
$
1.10
Weighted Average Shares Outstanding:
Basic
18,347,189
18,082,492
18,317,003
18,062,591
Diluted
18,584,693
18,394,865
18,614,527
18,367,384
GEOGRAPHICAL NET SALES(1)
(Unaudited)
(In millions)
Three Months Ended
Six Months Ended
June 30
June 30
2020
2019
%
2020
2019
%
Americas
$
136.3
$
189.5
(28.1
)
$
298.9
350.3
(14.7
)
Europe, Middle East and Africa
54.8
80.9
(32.3
)
126.8
158.9
(20.2
)
Asia Pacific
22.9
29.3
(21.8
)
40.4
52.9
(23.6
)
Total
$
214.0
$
299.7
(28.6
)
$
466.1
$
562.1
(17.1
)
(1)
Net of intercompany sales.
TENNANT COMPANY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)
June 30,
December 31,
2020
2019
ASSETS
Current Assets:
Cash, Cash Equivalents and Restricted
Cash
$
99.3
$
74.6
Receivables:
Trade, less Allowances of $3.9 and $3.6,
respectively
180.3
216.5
Other
3.9
6.8
Net Receivables
184.2
223.3
Inventories
149.9
150.1
Prepaid and Other Current Assets
27.5
33.0
Total Current Assets
460.9
481.0
Property, Plant and Equipment
428.4
412.5
Accumulated Depreciation
(249.8
)
(239.2
)
Property, Plant and Equipment, Net
178.6
173.3
Operating Lease Assets
42.4
46.6
Goodwill
193.9
195.1
Intangible Assets, Net
126.7
137.7
Other Assets
25.7
29.2
Total Assets
$
1,028.2
$
1,062.9
LIABILITIES AND TOTAL EQUITY
Current Liabilities:
Current Portion of Long-Term Debt
$
42.5
$
31.3
Accounts Payable
77.4
94.1
Employee Compensation and Benefits
45.0
63.5
Other Current Liabilities
86.6
86.0
Total Current Liabilities
251.5
274.9
Long-Term Liabilities:
Long-Term Debt
297.5
307.5
Long-Term Operating Lease Liabilities
27.1
30.3
Employee-Related Benefits
18.0
19.4
Deferred Income Taxes
38.7
41.7
Other Liabilities
22.3
27.8
Total Long-Term Liabilities
403.6
426.7
Total Liabilities
655.1
701.6
Equity:
Common Stock
6.9
6.9
Additional Paid-In Capital
49.4
45.5
Retained Earnings
357.4
346.0
Accumulated Other Comprehensive Loss
(42.0
)
(38.5
)
Total Tennant Company Shareholders’
Equity
371.7
359.9
Noncontrolling Interest
1.4
1.4
Total Equity
373.1
361.3
Total Liabilities and Total Equity
$
1,028.2
$
1,062.9
TENNANT COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In millions)
Six Months Ended
June 30
2020
2019
OPERATING ACTIVITIES
Net Earnings Including Noncontrolling
Interest
$
19.5
$
20.2
Adjustments to reconcile Net Earnings to
Net Cash Provided by Operating Activities:
Depreciation
15.7
15.9
Amortization of Intangible Assets
10.0
11.5
Amortization of Debt Issuance Costs
0.7
0.6
Fair Value Step-Up Adjustment to Acquired
Inventory
—
0.9
Deferred Income Taxes
(2.7
)
(4.2
)
Share-Based Compensation Expense
2.8
5.0
Allowance for Doubtful Accounts and
Returns
0.7
0.9
Acquisition Contingent Consideration
Adjustment
(0.3
)
2.0
Note Receivable Writedown
—
2.7
Other, Net
1.3
0.1
Changes in Operating Assets and
Liabilities, Net of Assets Acquired:
Receivables, Net
38.3
(16.3
)
Inventories
(5.1
)
(23.1
)
Accounts Payable
(17.8
)
0.5
Employee Compensation and Benefits
(16.4
)
(4.4
)
Other Current Liabilities
2.3
(2.1
)
Other Assets and Liabilities
(0.5
)
0.7
Net Cash Provided by Operating
Activities
48.5
10.9
INVESTING ACTIVITIES
Purchases of Property, Plant and
Equipment
(18.4
)
(25.4
)
Proceeds from Disposals of Property, Plant
and Equipment
0.1
—
Proceeds from Principal Payments Received
on Long-Term Note Receivable
—
0.1
Acquisition of Business, Net of Cash, Cash
Equivalents and Restricted Cash Acquired
—
(8.9
)
Purchase of Intangible Assets
(0.1
)
(0.4
)
Net Cash Used in Investing Activities
(18.4
)
(34.6
)
FINANCING ACTIVITIES
Proceeds from Borrowings
126.4
25.0
Repayments of Debt
(125.5
)
(25.9
)
Change in Finance Lease Obligations
(0.1
)
(0.1
)
Proceeds from Issuances of Common
Stock
2.6
1.2
Purchase of Noncontrolling Owner
Interest
—
(0.5
)
Dividends Paid
(8.1
)
(8.0
)
Net Cash Used in Financing Activities
(4.7
)
(8.3
)
Effect of Exchange Rate Changes on Cash,
Cash Equivalents and Restricted Cash
(0.7
)
1.3
Net Increase (Decrease) in Cash, Cash
Equivalents and Restricted Cash
24.7
(30.7
)
Cash, Cash Equivalents and Restricted Cash
at Beginning of Period
74.6
86.1
Cash, Cash Equivalents and Restricted Cash
at End of Period
$
99.3
$
55.4
TENNANT COMPANY
SUPPLEMENTAL NON-GAAP FINANCIAL
TABLE
(In millions, except per share data)
Three Months Ended
Six Months Ended
June 30
June 30
2020
2019
2020
2019
Gross Profit - as reported
$
90.6
$
120.8
$
194.7
$
229.0
Gross Margin - as reported
42.3
%
40.3
%
41.8
%
40.7
%
Adjustments:
Discontinuation of Product Lines
—
2.4
1.7
2.4
Inventory Step-Up
$
—
$
0.9
$
—
$
0.9
Gross Profit - as adjusted
$
90.6
$
124.1
$
196.4
$
232.3
Gross Margin - as adjusted
42.3
%
41.4
%
42.1
%
41.3
%
Selling and Administrative Expense - as
reported
$
61.1
$
92.5
$
143.4
$
182.7
Selling and Administrative Expense as a
percent of Net Sales - as reported
28.6
%
30.9
%
30.8
%
32.5
%
Adjustments:
Acquisition and Integration Costs
—
(0.8
)
—
(1.4
)
Professional Services
—
—
—
(0.1
)
Restructuring Charge
(0.3
)
—
(1.1
)
(4.3
)
Note Receivable Write-down
—
(2.7
)
—
(2.7
)
Acquisition Contingent Consideration
Adjustment
0.3
(2.0
)
0.3
(2.0
)
Selling and Administrative Expense - as
adjusted
$
61.1
$
87.0
$
142.6
$
172.2
Selling and Administrative Expense as a
percent of Net Sales - as adjusted
28.6
%
29.0
%
30.6
%
30.6
%
Profit from Operations - as reported
$
22.9
$
19.9
$
37.3
$
30.7
Operating Margin - as reported
10.7
%
6.6
%
8.0
%
5.5
%
Adjustments:
Discontinuation of Product Lines
—
2.4
1.7
2.4
Inventory Step-Up
—
0.9
—
0.9
Acquisition and Integration Costs
—
0.8
—
1.4
Professional Services
—
—
—
0.1
Restructuring Charge
0.3
—
1.1
4.3
Note Receivable Write-down
—
2.7
—
2.7
Acquisition Contingent Consideration
Adjustment
(0.3
)
2.0
(0.3
)
2.0
Profit from Operations - as adjusted
$
22.9
$
28.7
$
39.8
$
44.5
Operating Margin - as adjusted
10.7
%
9.6
%
8.5
%
7.9
%
TENNANT COMPANY
SUPPLEMENTAL NON-GAAP FINANCIAL
TABLE
(In millions, except per share data)
Three Months Ended
Six Months Ended
June 30
June 30
2020
2019
2020
2019
Profit Before Income Taxes - as
reported
$
17.9
$
16.6
$
24.2
$
23.2
Adjustments:
Discontinuation of Product Lines
—
2.4
1.7
2.4
Inventory Step-Up
—
0.9
—
0.9
Acquisition and Integration Costs (S&A
Expense)
—
0.8
—
1.4
Acquisition and Integration Costs (Other
Income, Net)
—
(1.8
)
—
(1.8
)
Professional Services
—
—
—
0.1
Restructuring Charge
0.3
—
1.1
4.3
Note Receivable Write-down
—
2.7
—
2.7
Acquisition Contingent Consideration
Adjustment
(0.3
)
2.0
(0.3
)
2.0
Amortization Expense
5.0
5.8
10.0
11.5
Profit Before Income Taxes - as
adjusted
$
22.9
$
29.4
$
36.7
$
46.7
Income Tax Expense - as reported
$
3.6
$
1.8
$
4.7
$
3.0
Adjustments:
Discontinuation of Product Lines(1)
—
0.6
0.4
0.6
Inventory Step-Up(1)
—
0.2
—
0.2
Acquisition and Integration Costs (S&A
Expense)(1)
—
0.2
—
0.3
Acquisition and Integration Costs (Other
Income, Net)(1)
—
—
—
—
Professional Services(1)
—
—
—
—
Restructuring Charge(1)
0.1
—
0.4
1.2
Note Receivable Write-down(1)
—
—
—
—
Acquisition Contingent Consideration
Adjustment(1)
—
—
—
—
Amortization Expense(1)
1.4
1.7
2.8
3.1
Income Tax Expense - as adjusted
$
5.1
$
4.5
$
8.3
$
8.4
(1)
In determining the tax impact, we applied
the statutory rate in effect for each jurisdiction where expenses
were incurred and deductible for tax purposes.
TENNANT COMPANY
SUPPLEMENTAL NON-GAAP FINANCIAL
TABLE
(In millions, except per share data)
Three Months Ended
Six Months Ended
June 30
June 30
2020
2019
2020
2019
Net Earnings Attributable to Tennant
Company - as reported
$
14.3
$
14.8
$
19.5
$
20.2
Adjustments:
Discontinuation of Product Lines
—
1.8
1.3
1.8
Inventory Step-Up
—
0.7
—
0.7
Acquisition and Integration Costs (S&A
Expense)
—
0.6
—
1.1
Acquisition and Integration Costs (Other
Income, Net)
—
(1.8
)
—
(1.8
)
Professional Services
—
—
—
0.1
Restructuring Charge
0.2
—
0.7
3.1
Note Receivable Write-down
—
2.7
—
2.7
Acquisition Contingent Consideration
Adjustment
(0.3
)
2.0
(0.3
)
2.0
Amortization Expense
3.6
4.1
7.2
8.4
Net Earnings Attributable to Tennant
Company - as adjusted
$
17.8
$
24.9
$
28.4
$
38.3
Net Earnings Attributable to Tennant
Company per Share - as reported:
Diluted
$
0.77
$
0.81
$
1.05
$
1.10
Adjustments:
Discontinuation of Product Lines
—
0.10
0.07
0.10
Inventory Step-Up
—
0.04
—
0.04
Acquisition and Integration Costs (S&A
Expense)
—
0.02
—
0.06
Acquisition and Integration Costs (Other
Income, Net)
—
(0.10
)
—
(0.10
)
Professional Services
—
—
—
—
Restructuring Charge
0.01
—
0.04
0.17
Note Receivable Write-down
—
0.15
—
0.15
Acquisition Contingent Consideration
Adjustment
(0.02
)
0.11
(0.02
)
0.11
Amortization Expense
0.20
0.22
0.39
0.46
Net Earnings Attributable to Tennant
Company per Share - as adjusted
$
0.96
$
1.35
$
1.53
$
2.09
TENNANT COMPANY
SUPPLEMENTAL NON-GAAP FINANCIAL
TABLE
(In millions, except per share data)
Three Months Ended
Six Months Ended
June 30
June 30
2020
2019
2020
2019
Net Earnings Including Noncontrolling
Interest - as reported
$
14.3
$
14.8
$
19.5
$
20.2
Adjustments:
Interest Income
(0.8
)
(0.9
)
(1.7
)
(1.7
)
Interest Expense
5.6
5.4
10.7
10.5
Income Tax Expense
3.6
1.8
4.7
3.0
Depreciation Expense
7.6
7.9
15.7
15.9
Amortization Expense
5.0
5.8
10.0
11.5
Discontinuation of Product Lines
—
2.4
1.7
2.4
Inventory Step-Up
—
0.9
—
0.9
Acquisition and Integration Costs (S&A
Expense)
—
0.8
—
1.4
Acquisition and Integration Costs (Other
Income, Net)
—
(1.8
)
—
(1.8
)
Professional Services
—
—
—
0.1
Restructuring Charge
0.3
—
1.1
4.3
Note Receivable Write-down
—
2.7
—
2.7
Acquisition Contingent Consideration
Adjustment
(0.3
)
2.0
(0.3
)
2.0
Earnings Before Interest, Taxes,
Depreciation & Amortization - as adjusted
$
35.3
$
41.8
$
61.4
$
71.4
EBITDA Margin - as adjusted
16.5
%
13.9
%
13.2
%
12.7
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200730005125/en/
INVESTOR CONTACT: William Prate Director, Investor Relations
william.prate@tennantco.com 763-540-1547
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