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     396  0 Kommentare Esterline Reports Financial Results for Third Fiscal Quarter of 2015

    BELLEVUE, WA--(Marketwired - Sep 3, 2015) -  Esterline Corporation (NYSE: ESL)

    • Fiscal third quarter sales of $496.2 million
    • Earnings from continuing operations of $30.2 million, or $0.97 per diluted share
    • Adjusted earnings from continuing operations of $41.2 million, or $1.33 per diluted share
    • Year-to-date free cash flow conversion 116% of net income
    • Updated full-year 2015 adjusted EPS guidance

    Esterline Corporation (NYSE: ESL) (www.esterline.com), a leading specialty manufacturer serving the global aerospace and defense markets, today reported results for the fiscal third quarter ended July 31, 2015. Consolidated revenue of $496.2 million declined 2.0% compared with the year-ago period of $506.3 million. Foreign currency impacts were offset by sales from the Defense, Aerospace, and Training display business (DAT) acquired from Barco N.V. in the second quarter of fiscal 2015. Excluding these items, organic sales volume declined by 2.8%.

    GAAP earnings from continuing operations in the third fiscal quarter of 2015 were $30.2 million, or $0.97 per diluted share, compared with $39.8 million, or $1.22 per diluted share, in the prior-year period. Adjusted earnings from continuing operations in the third quarter of fiscal 2015 were $41.2 million, or $1.33 per diluted share. This excludes $0.26 per diluted share related to the company's previously disclosed integration and compliance activities and $0.10 per diluted share from the impact of DAT purchase accounting and integration costs (see Table 1). 

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    Curtis Reusser, Esterline's Chief Executive Officer, said, "During the third quarter we continued our work to reshape Esterline into a stronger company with increased efficiencies that will bring added value to our stakeholders. Activities this quarter included an important restructuring of our executive team and further advancement of our E3 operational excellence program. We were pleased to see solid improvement in our operating margins in the third quarter compared with the first half of this fiscal year." Reusser continued, "Our end markets are fundamentally healthy and commercial aerospace, in particular, is supported by strong orders at the OEM level and robust airline profitability. In the short term, early 2016 sales growth could remain challenged, as most commercial aerospace production rates have stabilized and energy and general industrial markets are still under pressure." 

             
             
      Table 1: Effect of Certain Items on 3rd Fiscal Quarter    
                    2015 Earnings from Continuing Operations     
               
        $ millions   EPS  
      Earnings - U.S. GAAP $ 30.2   $ 0.97  
                   
      Accelerated Integration Costs   2.3     0.08  
      Compliance Costs   5.8     0.18  
      DAT Net Loss   2.9     0.10  
                   
      Adjusted Earnings $ 41.2   $ 1.33  
                   
                   

    Including discontinued operations, net earnings for the fiscal third quarter of 2015 were $28.5 million, or $0.92 per diluted share, compared with $38.9 million, or $1.19 per diluted share, in the prior-year period. Net earnings in the third quarter of fiscal 2015 included a $1.7 million loss from discontinued operations, while the prior-year period included a $0.9 million loss from discontinued operations.

    New orders in the third quarter of fiscal 2015 were $508.7 million, including $49.3 million from DAT, compared with $515.1 million in the year-ago period. Backlog at the end of the third quarter of fiscal 2015 was $1.28 billion, compared with $1.25 billion at the end of the third quarter of fiscal 2014. Third quarter backlog for 2015 includes $190.8 million from DAT. 

    Gross margin as a percentage of sales in the third quarter of fiscal 2015 was 34.2%, compared with 35.0% in the prior-year period. The lower gross margin relative to the prior year primarily reflects lower sales volumes and unfavorable sales mix in Avionics & Controls and Advanced Materials. 

    Fiscal third quarter selling, general and administrative (SG&A) expense as a percentage of sales was 18.5%, compared with the prior-year level of 17.6%. Higher SG&A was attributable to the addition of DAT and increased compliance costs. On an adjusted basis that excludes incremental compliance costs and the DAT impact, fiscal third quarter 2015 SG&A expense as a percentage of sales was 16.4%, compared with an adjusted prior-year level of 17.1%. Foreign exchange translation drove part of this improvement. 

    During the fiscal third quarter the company incurred integration and certain pre-tax incremental compliance costs of $9.9 million; $7.1 million was reported in SG&A expense, $1.4 million was reflected in gross margin, and $1.4 million was reported as restructuring charges. In the prior-year period for these activities, the company incurred pre-tax costs of $7.7 million; $3.4 million was reported as restructuring charges, $2.3 million was reported in SG&A expense, and $2.0 million was reflected in gross margin. The company's integration efforts remain on track.

    Research, development and engineering (R&D) spending in the third quarter of fiscal 2015 was $29.2 million, or 5.9% of sales, compared with $24.3 million, or 4.8% of sales, in the prior-year period. Excluding the impact of DAT, the company's R&D was 4.6% of sales in the third quarter of fiscal 2015. The company expects full-year R&D spending to be approximately 5.5% of sales. 

    The company's income tax rate in the third quarter of fiscal 2015 was 17.4%, compared with 23.7% in the prior-year period. The lower tax rate was driven by higher discrete tax benefits and the DAT net loss. The company expects the full-year income tax rate for fiscal 2015 to be approximately 20%. 

    Cash flow from operations was $104.2 million through the nine months ended July 31, 2015, driving strong free cash flow conversion at 116% of net income. The company repurchased 1.4 million shares in the fiscal 2015 third quarter for $132.2 million. Since the company launched its share repurchase program in July 2014, it has repurchased 2.8 million shares for $289.8 million. The company's total approved share repurchase level is $400 million.

    Through the third fiscal quarter of 2015, sales decreased 4.0% to $1.4 billion, compared with $1.5 billion in the prior year. Year-to-date foreign currency translation effects were mostly offset by sales from the recently acquired DAT operations. Excluding these items, organic sales volumes declined by 3.5% in the first nine months of fiscal 2015.

    Year-to-date GAAP earnings from continuing operations were $76.9 million, or $2.44 per diluted share, compared with $114.4 million, or $3.53 per diluted share, in the prior-year period. Excluding discrete costs described in Table 2 below, adjusted earnings from continuing operations through the third fiscal quarter of 2015 were $106.5 million, or $3.38 per diluted share, compared with the adjusted year-ago period results of $131.3 million, or $4.05 per diluted share.

               
               
      Table 2: Effect of Certain Items on YTD        
                    2015 Earnings from Continuing Operations        
                 
        $ millions     EPS  
      Earnings - U.S. GAAP $ 76.9     $ 2.44  
                     
      Accelerated Integration Costs   8.1       0.25  
      Compliance Costs   12.0       0.38  
      DAT Closing Expenses   4.7       0.15  
      DAT Net Loss   8.5       0.27  
      Long-term Contract Adjustments   7.7       0.25  
      Pension Expense   2.3       0.07  
      Non-income Tax Gain   (13.7 )     (0.43 )
                     
      Adjusted Earnings $ 106.5     $ 3.38  
                     
                     

    Adjusted Guidance for 11-month Fiscal 2015

    The company has updated its full-year guidance for the 11-month fiscal year ended October 2, 2015, to reflect third quarter results and expectations for the fiscal fourth quarter. The company expects full-year revenue to be in a range of $1.78 billion to $1.80 billion, including approximately $100 million from DAT. Full-year adjusted earnings from continuing operations, which incorporates $3.38 per diluted share for year-to-date adjusted results, are expected in a range of $4.35 to $4.45 per diluted share. The updated adjusted earnings per share guidance excludes fiscal fourth quarter costs expected for integration and compliance, expenses related to the 7% Senior Note redemption, and costs associated with DAT purchase accounting and integration. 

    Conference Call Information

    Esterline will host a conference call to discuss this announcement today at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time). The U.S. dial-in number is 1-866-953-6859; outside the U.S., use 617-399-3483. The pass code for the call is: 53962953. The company has posted a presentation on its website (www.esterline.com) under "Presentations" in the Investor Relations section to provide additional information about its third fiscal quarter operational and financial results. The presentation is also included as Exhibit 99.2 to the company's report on Form 8-K, which is being submitted today to the SEC. 

    Non-GAAP Financial Information

    This press release and the related presentation providing supplemental financial information include non-GAAP financial measures -- adjusted earnings from continuing operations, adjusted earnings from continuing operations per diluted share, adjusted earnings before interest and tax (EBIT), adjusted SG&A expense as a percentage of sales, adjusted R&D expense as a percentage of sales, adjusted gross margin, and free cash flow conversion -- that have not been calculated in accordance with generally accepted accounting principles in the U.S. (GAAP). Adjusted earnings from continuing operations consists of earnings from continuing operations attributable to Esterline less the costs associated with certain integration activities -- including restructuring charges -- and incremental compliance costs as well as discrete items associated with our acquisition of the DAT business in January 2015, adjustments to reserves on long-term contracts incurred in the periods presented and unique amounts related to pension expense and a non-income tax gain, in each case, as further detailed in the tables below. Adjusted earnings from continuing operations per diluted share divides each element of adjusted earnings from continuing operations by the weighted average number of shares outstanding, diluted for the periods presented. EBIT is defined as operating earnings from continuing operations. Adjusted EBIT excludes the same costs excluded from adjusted earnings from continuing operations and excludes DAT sales of $32 million from GAAP sales. Fiscal third quarter 2015 adjusted SG&A expense as a percentage of sales excludes the cost of certain compliance costs of $7 million as well as DAT's SG&A expense of $9 million from GAAP SG&A. The calculation also excludes DAT's sales from GAAP sales. Fiscal third quarter 2014 adjusted SG&A expense as a percentage of sales excludes the cost of certain integration and compliance costs of $2 million from GAAP SG&A. Adjusted R&D as a percentage of sales excludes $8 million of DAT R&D expense from GAAP R&D and excludes DAT sales from GAAP sales. Adjusted gross margin excludes the cost of certain integration activities and DAT's gross margin from GAAP gross margin and excludes DAT's sales from GAAP sales. Year-to-date 2015 free cash flow conversion is calculated by dividing free cash flow of $66 million (cash flow from operations of $104 million less capital expenditures of $38 million) by net earnings of $57 million. In accordance with the SEC's requirements, below is the reconciliation of the non-GAAP adjusted earnings from continuing operations to the comparable GAAP earnings from continuing operations.

                         
    In millions, except per share amounts                    
        Three Months Ended     Three Months Ended
        July 31, 2015     August 1, 2014
             Per Diluted
    Share
            Per Diluted
    Share
                                 
    Earnings from Continuing Operations Attributable to Esterline (GAAP), Net of Tax   $
    30.2
        $
    0.97
        $
    39.8
      $
    1.22
      Accelerated Integration Costs, Net of $0.5 and $1.2 Tax Benefit    
    2.3
         
    0.08
         
    4.2
       
    0.13
      Compliance Costs, Net of $1.3 and $0.5 Tax Benefit     5.8       0.18       1.8     0.06
      DAT Net Loss, Net of $0.8 Tax Benefit     2.9       0.10       --     --
                                 
    Adjusted Earnings from Continuing Operations (non-GAAP), Net of Tax   $
    41.2
        $
    1.33
        $
    45.8
      $
    1.41
                                 
    In millions, except per share amounts                    
        Nine Months Ended     Nine Months Ended
        July 31, 2015     August 1, 2014
              Per Diluted
    Share
             Per Diluted
    Share
                                 
    Earnings from Continuing Operations Attributable to Esterline (GAAP), Net of Tax   $ 76.9     $ 2.44     $ 114.4   $ 3.53
      Accelerated Integration Costs, Net of $2.0 and $3.0 Tax Benefit     8.1       0.25       11.4     0.35
      Compliance Costs, Net of $3.0 and $1.4 Tax Benefit     12.0       0.38       5.5     0.17
      DAT Closing Expenses, Net of $1.3 Tax Benefit     4.7       0.15       --     --
      DAT Net Loss, Net of $2.0 Tax Benefit     8.5       0.27       --     --
      Long-term Contract Adjustments, Net of $2.2 Tax Benefit     7.7       0.25       --     --
      Pension Expense, Net of $0.7 Tax Benefit     2.3       0.07       --     --
      Non-Income Tax Gain, Net of $4.4 Tax Expense     (13.7 )     (0.43 )     --     --
                                 
    Adjusted Earnings from Continuing Operations (non-GAAP), Net of Tax   $
    106.5
        $
    3.38
        $
    131.3
      $
    4.05
                                 

    The company provides these non-GAAP financial measures as supplemental information to our GAAP financial measures. Management uses these non-GAAP financial measures to (a) evaluate the company's historical and prospective financial performance and its performance relative to its competitors, (b) allocate resources, and (c) measure the operational performance of the company's business units.

    In addition, management believes investors' and financial analysts' understanding of the company's performance is enhanced by including these non-GAAP financial measures as a reasonable basis for comparing the company's historical results of operations.

    These non-GAAP financial measures are not meant to be considered in isolation or as a substitute for the comparable GAAP measures, and free cash flow is not necessarily indicative of amounts available for discretionary use. There are limitations to these non-GAAP financial measures because they are not prepared in accordance with GAAP and may not be comparable to similarly titled measures of other companies due to potential differences in methods of calculation and items that comprise the calculation. The company compensates for these limitations by using these non-GAAP financial measures as a supplement to the GAAP measures and by providing reconciliations of the non-GAAP and comparable GAAP financial measures. The non-GAAP financial measures should be read only in conjunction with the company's consolidated financial statements prepared in accordance with GAAP.

    This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "potential," "predict," "should" or "will," or the negative of such terms, or other comparable terminology. These forward-looking statements are only predictions based on the current intent and expectations of the management of Esterline, are not guarantees of future performance or actions, and involve risks and uncertainties that are difficult to predict and may cause Esterline's or its industry's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Esterline's actual results and the timing and outcome of events may differ materially from those expressed in or implied by the forward-looking statements due to risks detailed in Esterline's public filings with the Securities and Exchange Commission including its most recent Annual Report on Form 10-K.

                             
    ESTERLINE TECHNOLOGIES CORPORATION  
    Consolidated Statement of Operations (unaudited)  
    In thousands, except per share amounts  
                             
        Three Months Ended     Nine Months Ended  
        July 31,     August 1,     July 31,     August 1,  
        2015     2014     2015     2014  
    Segment Sales                                
      Avionics & Controls   $ 207,467     $ 192,860     $ 594,534     $ 571,366  
      Sensors & Systems     175,530       192,246       515,611       579,131  
      Advanced Materials     113,220       121,203       332,496       352,613  
                                     
    Net Sales     496,217       506,309       1,442,641       1,503,110  
                                     
    Cost of Sales     326,421       329,222       963,844       976,063  
          169,796       177,087       478,797       527,047  
    Expenses                                
      Selling, general and administrative     91,968       88,884       286,366       270,051  
      Research, development and engineering     29,245       24,259       78,700       75,441  
      Restructuring charges     1,403       3,405       5,375       10,279  
      Other income     --       --       (12,744 )     -  
      Total Expenses     122,616       116,548       357,697       355,771  
                                     
    Operating Earnings From Continuing Operations     47,180       60,539       121,100       171,276  
                                     
    Interest Income     (144 )     (145 )     (447 )     (400 )
    Interest Expense     10,618       7,865       25,023       24,924  
    Loss on Extinguishment of Debt     --       533       329       533  
                                     
    Earnings From Continuing Operations Before Income Taxes    
    36,706
         
    52,286
         
    96,195
         
    146,219
     
    Income Tax Expense     6,405       12,403       19,097       31,415  
    Earnings From Continuing Operations Including Noncontrolling Interests    
    30,301
         
    39,883
         
    77,098
         
    114,804
     
    Earnings Attributable to Noncontrolling Interests     (111 )     (46 )     (218 )     (429 )
    Earnings From Continuing Operations Attributable to Esterline, Net of Tax    
    30,190
         
    39,837
         
    76,880
         
    114,375
     
    Loss From Discontinued Operations, Attributable to Esterline, Net of Tax    
    (1,693
    )    
    (929
    )    
    (20,254
    )    
    (8,485
    )
                                     
    Net Earnings Attributable to Esterline   $ 28,497     $ 38,908     $ 56,626     $ 105,890  
                                     
    Earnings (Loss) Per Share-Basic:                                
      Continuing Operations   $ 1.00     $ 1.25     $ 2.48     $ 3.60  
      Discontinued Operations     (.06 )     (.03 )     (.65 )     (.27 )
                                     
    Earnings (Loss) Per Share-Basic   $ .94     $ 1.22     $ 1.83     $ 3.33  
                                     
    Earnings (Loss) Per Share-Diluted:                                
      Continuing Operations   $ .97     $ 1.22     $ 2.44     $ 3.53  
      Discontinued Operations     (.05 )     (.03 )     (.64 )     (.26 )
                                     
    Earnings (Loss) Per Share-Diluted   $ .92     $ 1.19     $ 1.80     $ 3.27  
                                     
    Weighted Average Number of Shares Outstanding-Basic    
    30,397
         
    31,995
         
    31,003
         
    31,818
     
                                     
    Weighted Average Number of Shares Outstanding-Diluted    
    30,914
         
    32,591
         
    31,531
         
    32,427
     
                                     
       
    ESTERLINE TECHNOLOGIES CORPORATION  
    Consolidated Sales and Earnings From Continuing Operations by Segment (unaudited)  
    In thousands  
                             
        Three Months Ended     Nine Months Ended  
        July 31,     August 1,     July 31,     August 1,  
        2015     2014     2015     2014  
                                     
    Segment Sales                                
      Avionics & Controls   $ 207,467     $ 192,860     $ 594,534     $ 571,366  
      Sensors & Systems     175,530       192,246       515,611       579,131  
      Advanced Materials     113,220       121,203       332,496       352,613  
                                     
        Net Sales   $ 496,217     $ 506,309     $ 1,442,641     $ 1,503,110  
                                     
    Earnings From Continuing Operations Before Income Taxes                                
      Avionics & Controls   $ 23,473     $ 30,902     $ 52,024     $ 81,952  
      Sensors & Systems     23,356       18,055       55,491       61,811  
      Advanced Materials     24,396       27,724       65,908       75,911  
        Segment Earnings     71,225       76,681       173,423       219,674  
                                     
      Corporate expense     (24,045 )     (16,142 )     (65,067 )     (48,398 )
      Other income     --       --       12,744       -  
      Interest income     144       145       447       400  
      Interest expense     (10,618 )     (7,865 )     (25,023 )     (24,924 )
      Loss on extinguishment of debt     -       (533 )     (329 )     (533 )
                                     
      Earnings From Continuing Operations Before Income Taxes    
    $36,706
         
    $52,286
         
    $96,195
         
    $146,219
     
                                     
     
    ESTERLINE TECHNOLOGIES CORPORATION
    Consolidated Balance Sheet (unaudited)
    In thousands
        July 31,   August 1,
        2015   2014
    Assets            
    Current Assets            
      Cash and cash equivalents   $ 187,682   $ 210,456
      Accounts receivable, net     373,699     361,827
      Inventories     469,700     493,812
      Income tax refundable     17,515     7,681
      Deferred income tax benefits     36,945     50,716
      Prepaid expenses     21,407     24,816
      Other current assets     17,196     4,286
      Current assets held for sale     14,398     --
        Total Current Assets     1,138,542     1,153,594
                 
    Property, Plant and Equipment, Net     306,391     363,205
                 
    Other Non-Current Assets            
      Goodwill     1,040,443     1,132,987
      Intangibles, net     459,968     560,893
      Debt issuance costs, net     11,035     4,637
      Deferred income tax benefits     75,612     68,416
      Other assets     22,103     24,726
      Non-current assets held for sale     31,558     --
        $ 3,085,652   $ 3,308,458
                 
    Liabilities and Shareholders' Equity            
    Current Liabilities            
      Accounts payable   $ 111,415   $ 123,376
      Accrued liabilities     267,386     238,968
      Current maturities of long-term debt     1,014     12,822
      Deferred income tax liabilities     2,993     3,205
      Federal and foreign income taxes     3,853     2,309
      Current liabilities held for sale     8,885     --
        Total Current Liabilities     395,546     380,680
                 
    Long-Term Liabilities            
      Credit facilities     200,000     115,000
      Long-term debt, net of current maturities     712,809     513,119
      Deferred income tax liabilities     133,499     178,796
      Pension and post-retirement obligations     56,758     62,759
      Other liabilities     30,512     47,313
      Non-current liabilities held for sale     1,859     --
                 
    Total Shareholders' Equity     1,554,669     2,010,791
        $ 3,085,652   $ 3,308,458
                 



    Verfasst von Marketwired
    Esterline Reports Financial Results for Third Fiscal Quarter of 2015 BELLEVUE, WA--(Marketwired - Sep 3, 2015) -  Esterline Corporation (NYSE: ESL) Fiscal third quarter sales of $496.2 million Earnings from continuing operations of $30.2 million, or $0.97 per diluted share …