ENP Newswire -
Release date- 06082014 -
Second Quarter Results
In the second quarter of fiscal 2014,
'End market conditions improved throughout much of our second quarter, and while our sales level was steady with last year, on a sequential basis our sales were up 12% from our first quarter. Compared to the first quarter, sales for material handling applications, our largest served market, were up nearly 10%, while sales into elevator markets were up 15%.
In addition, our second quarter gross margin increased to 36% of sales, and our operating profit margin exceeded our stated target of 10%. In summary, we challenged the organization to improve our operating performance, and our people responded very well, as we not only saw healthy growth in our business, but also controlled our costs and managed our assets quite well,' said
Gross profit amounted to
Total operating expenses, consisting of research and development, pension expense, and selling, general and administrative costs, were
Income from continuing operations after provision for income taxes in the second quarter of fiscal 2014 was
Including the results of discontinued operations, the Company recorded net income of
Unrestricted cash balances increased by
Operations and Outlook
Total second quarter 2014 bookings were
'Business conditions in most of our end markets improved during the quarter, as the momentum we experienced late in the first quarter continued into the second quarter. We're optimistic that economic activity will continue to show modest improvement through the remainder of 2014. Over the past several quarters, we've continued to take actions to better align our cost structure with current sales volumes, improving the operating leverage in our business, and we saw the impact of those actions in our second quarter results.
If we're able to maintain current incoming order rates throughout the third quarter, we should be able to post quarterly operating results in the second half of the year similar to the results of the second quarter,' said
For example, over the past 7 years, we've generated
Reduced pension funding amounts would in turn provide us with greater resources to reinvest in opportunities aimed at growing our business and increasing profitability. In summary, mid- to longer-term, we continue to believe that we have great opportunities to increase the value of the Company through a combination of steady growth in sales and profits, consistently strong cash flow generation, and further reductions in our pension obligation,' concluded
As previously disclosed,
The Company measures its pension annually, on the last day of its fiscal year, and adjusts the reported pension obligation per the balance sheet accordingly. In its Annual Report on Form 10-K for the fiscal year ended
During the first six months of 2014, interest rates used to measure pension liabilities decreased approximately 50 basis points. The increase in the Company's pension obligation resulting from higher interest rates is estimated at approximately
During the same period, the Company's pension assets increased by approximately
The Company contributed approximately
The actual timing and amount of future pension plan contributions are dependent upon many factors, including returns on invested assets, the level of certain market interest rates, the discount rate used to determine pension obligations, voluntary contributions the Company may elect to make to the plan, and other potential regulatory actions.
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the Company's anticipated financial results for its fiscal quarters ending
Future events and actual results could differ materially from those set forth in, contemplated by, or underlying these forward-looking statements. These include, but are not limited to, economic conditions in general, business conditions in material handling, elevator, and mining markets, operating conditions, competitive factors such as pricing and technology, risks associated with acquisitions and divestitures, legal proceedings and the risk that the Company's ultimate costs of doing business exceed present estimates.
Other factors that could cause actual results to differ materially from expectations are described in the Company's reports filed with the
The Company may, in the course of its financial presentations, earnings releases, earnings conference calls, and otherwise, publicly disclose certain numerical measures which are or may be considered 'non-GAAP financial measures' under SEC Regulation G. 'GAAP' refers to generally accepted accounting principles in
These measures are not in accordance with, or a substitute for, GAAP, and may be different from or inconsistent with non-GAAP financial measures used by other companies. The Company's public disclosures may include non-GAAP measures such as EBITDA and adjusted EBITDA. EBITDA represents its GAAP results adjusted to exclude interest, taxes, depreciation and amortization.
Adjusted EBITDA represents EBITDA adjusted to exclude non-cash pension and stock compensation expenses. Company management believes that adjusted EBITDA is useful to investors as it provides a measure of the Company's cash flow prior to capital investments, changes in working capital, and pension contributions. As a result, management believes investors can use this metric as a measure of the Company's ability to fund its growth initiatives and its pension obligations.
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