UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
_______________________
Date of Report
(Date of earliest event reported): February 8, 2016
Regal Beloit Corporation
(Exact name of registrant as specified in its charter)
|
| | |
Wisconsin | 1-7283 | 39-0875718 |
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
200 State Street, Beloit, Wisconsin 53511-6254
(Address of principal executive offices, including Zip code)
(608) 364-8800
(Registrant's telephone number)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
_______________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
On February 8, 2016, Regal Beloit Corporation (the “Company”) issued a news release reporting the financial results of the Company for the financial period ended January 2, 2016. A copy of the Company's news release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
Item 7.01 Regulation FD Disclosure.
On February 9, 2016, the Company held a conference call to discuss its financial results for the financial period ended January 2, 2016 and provided a presentation in connection therewith. A copy of the Company's conference call presentation is furnished as Exhibit 99.2 to this Current Report on Form 8-K.
Item 9.01. Financial Statements and Exhibits.
| |
(d) | Exhibits. The following exhibits are being furnished herewith: |
| |
99.1 | News Release of Regal Beloit Corporation dated February 8, 2016. |
| |
99.2 | Regal Beloit Corporation Presentation of February 9, 2016. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
REGAL BELOIT CORPORATION
Date: February 9, 2016 By: /s/ Peter C. Underwood
Peter C. Underwood
Vice President, General Counsel and Secretary
REGAL BELOIT CORPORATION
Exhibit Index to Report on Form 8-K
Dated February 8, 2016
|
| | |
Exhibit Number | | Exhibit Description |
99.1 | | News Release of Regal Beloit Corporation dated February 8, 2016. |
99.2 | | Regal Beloit Corporation Presentation of February 9, 2016. |
FOR RELEASE ON: February 8, 2016
CONTACT: Robert Cherry, VP - Investor Relations
608-361-7530
robert.cherry@regalbeloit.com
Regal Beloit Corporation Announces Fourth Quarter and Full Year 2015 Financial Results
| |
• | Record 2015 Net Sales of $3.5 Billion and Record Adjusted Earnings Per Share |
| |
• | Significant Improvement in Adjusted Operating Profit Margin |
BELOIT, WI - Regal Beloit Corporation (NYSE: RBC) today reported fourth quarter 2015 diluted loss per share of ($0.43), including (i) a goodwill impairment of $58.1 million, net of tax, or $1.30 per share, related to China and oil & gas operations, and (ii) a $12.8 million charge, or $0.29 per share, for the wind down of its Venezuelan operations. Fourth quarter 2015 adjusted diluted earnings per share* were $1.17. Sales for the full year 2015 were a record $3.5 billion, an increase of 8% from 2014.
Key financial results for the fourth quarter 2015 included:
| |
• | Sales of $774 million were flat compared to the prior year with sales increases from the PTS acquisition of 16.5% offset by (i) organic sales declines of 14.0%, approximately half of which was related to the negative effect of five less shipping days in the fourth quarter versus the prior year, and (ii) a negative 2.7% foreign currency translation. |
| |
• | Adjusted operating profit of $79.5 million increased 32% from the prior year and represented an adjusted operating profit margin of 10.3%, an increase of 250 basis points from the prior year. GAAP operating loss was ($14.1) million. |
| |
• | Adjusted diluted earnings per share of $1.17 represented a 43% increase from the prior year. |
| |
• | Free cash flow was 169% of adjusted net income and the Company paid down $77 million of debt. |
Fourth quarter 2015 segment highlights versus the prior year fourth quarter included:
| |
• | Commercial and Industrial Systems Segment net sales were $371 million, down 18%. Sales were largely impacted by five fewer shipping days, weakness in oil & gas, a slowdown in the industrial markets in China and a negative 3.7% foreign currency translation. Despite these challenges, adjusted operating profit margin increased 480 basis points to 9.5%, due primarily to the simplification initiative, cost controls, a LIFO benefit and lower bad debt expenses compared to the prior year. |
| |
• | Climate Solutions Segment net sales were $210 million, down 18%. Sales were unfavorably impacted by five fewer shipping days, the SEER 13 pre-build, the effect of contractual two-way material price formulas, warmer weather in the North American market and a negative 1.5% foreign currency translation. Even with the lower sales, adjusted operating profit margin increased 130 basis points to 13.2%, due primarily to the benefits of the simplification initiative and cost controls. |
| |
• | Power Transmission Solutions Segment net sales increased 182% to $193 million, driven primarily by acquisition growth of $128 million. Sales were negatively impacted by five fewer shipping days, weak oil & gas and agricultural end markets, slower demand in the distribution channel, and a negative 0.6% foreign currency translation. |
*This earnings release includes non-GAAP financial measures. Descriptions of why we believe these non-GAAP measures are useful and reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures are included with this earnings release.
“At the beginning of 2015, we set out two key goals: improve operating margins in our legacy businesses and successfully integrate the PTS acquisition,” said Regal Chairman and CEO Mark Gliebe. “We accomplished both of these goals with better-than-expected results. We achieved a 150 basis point year-over-year adjusted operating profit margin improvement for the year, resulting in a 24% increase in adjusted EPS, and we exceeded our PTS synergy targets both in terms of dollars and timing.
"While we faced difficult end markets in the fourth quarter, we were pleased to deliver a 250 basis point year-over-year improvement in adjusted operating profit margin, increase adjusted EPS by 43%, and generate free cash flow of 169% of adjusted net income, which we used to pay down $77 million of debt.”
2016 Outlook
“As we look ahead to 2016, we do not yet see a catalyst that changes the challenging industrial environment. We expect continued weakness in our end markets to put pressure on our sales throughout 2016, although the second half should provide more favorable year over year comparisons.
"Our simplification initiative is at full stride and delivering synergy benefits which will help offset the top line challenges. We expect 2016 adjusted diluted earnings per share to be in the range of $4.80 to $5.20," continued Mr. Gliebe.
Conference Call
Management will hold a conference call to discuss the earnings release at 9:00 AM CST (10:00 AM EST) on February 9, 2016. Individuals who would like to participate by phone should dial 888-317-6003 and enter 9009396 when prompted. International callers should dial 412-317-6061 and enter 9009396 when prompted. To view the presentation during the call, please follow this link to Regal’s Investors page:
http://investors.regalbeloit.com/phoenix.zhtml?c=116222&p=irol-presentations.
To listen to the live audio and view the presentation via the internet, please go to:
https://www.webcaster4.com/Webcast/Page/747/12847.
A telephone replay of the call will be available through May 10, 2016, at 877-344-7529, conference ID 10079299. International callers should call 412-317-0088 using the same conference ID. A webcast replay will be available until May 10, 2016, and can be accessed at
http://investors.regalbeloit.com/phoenix.zhtml?c=116222&p=irol-calendarPast.
About the Company
Regal Beloit Corporation is a leading manufacturer of electric motors, electrical motion controls, power generation and power transmission products serving markets throughout the world. Regal Beloit is headquartered in Beloit, Wisconsin, and has manufacturing, sales and service facilities throughout the United States, Canada, Mexico, Europe and Asia. Regal Beloit’s common stock is a component of the S&P Mid Cap 400 Index and the Russell 1000 Index.
CAUTIONARY STATEMENT
The following is a cautionary statement made under the Private Securities Litigation Reform Act of 1995: With the exception of historical facts, the statements contained in this press release may be forward looking statements. Forward-looking statements represent our management’s judgment regarding future events. In many cases, you can identify forward-looking statements by terminology such as “may,” “will,” “plan,” “expect,” “anticipate,” “estimate,” “believe,” or “continue” or the negative of these terms or other similar words. Actual results and events could differ materially and adversely from those contained in the forward-looking statements due to a number of factors, including: uncertainties regarding our ability to execute our restructuring plans within expected costs and timing; increases in our overall debt levels as a result of the acquisition of the Power Transmission Solutions (“PTS”) business from Emerson Electric Co., or otherwise and our ability to repay principal and interest on our outstanding debt; actions taken by our competitors and our ability to effectively compete in the increasingly competitive global electric motor, power generation and mechanical motion control industries; our ability to develop new products based on technological innovation and the marketplace acceptance of new and existing products; fluctuations in commodity prices and raw material costs; our dependence on significant customers; issues and costs arising from the integration of acquired companies and businesses such as the PTS acquisition, including the timing and impact of purchase accounting adjustments; unanticipated costs or expenses we may incur related to product warranty issues; currency devaluations, non-payment of receivables, governmental restrictions such as price and margin controls, or other difficult operating conditions relating to our doing business in Venezuela; our dependence on key suppliers and the potential effects of supply disruptions; infringement of our intellectual property by third parties, challenges to our intellectual property, and claims of infringement by us of third party technologies; product liability and other litigation, or the failure of our products to perform as anticipated, particularly in high volume applications; economic changes in global markets where we do business, such as reduced demand for the products we sell, currency exchange rates, inflation rates, interest rates, recession, foreign government policies and other external factors that we cannot control; unanticipated liabilities of acquired businesses; effect on earnings of any significant impairment of goodwill or intangible assets; cyclical downturns affecting the global market for capital goods; difficulties associated with managing foreign operations; and other risks and uncertainties including but not limited to those described in Item 1A-Risk Factors of the Company’s Annual Report on Form 10-K filed on March 4, 2015 and from time to time in our reports filed with U.S. Securities and Exchange Commission. All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the applicable cautionary statements. The forward-looking statements included in this presentation are made only as of their respective dates, and we undertake no obligation to update these statements to reflect subsequent events or circumstances.
|
| | | | | | | | | | | | | | | | |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | | | | | | |
Unaudited | | | | | | | | |
(Amounts in Millions, Except per Share Data) | | | | | | |
| | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 |
Net Sales | | $ | 773.5 |
| | $ | 775.6 |
| | $ | 3,509.7 |
| | $ | 3,257.1 |
|
Cost of Sales | | 553.7 |
| | 587.5 |
| | 2,576.5 |
| | 2,459.8 |
|
Gross Profit | | 219.8 |
| | 188.1 |
| | 933.2 |
| | 797.3 |
|
Operating Expenses | | 154.0 |
| | 140.2 |
| | 600.5 |
| | 516.3 |
|
Goodwill Impairment | | 79.9 |
| | 118.5 |
| | 79.9 |
| | 119.5 |
|
Asset Impairments and Other, Net | | — |
| | 40.0 |
| | — |
| | 40.0 |
|
Total Operating Expenses | | 233.9 |
| | 298.7 |
| | 680.4 |
| | 675.8 |
|
Income (Loss) From Operations | | (14.1 | ) | | (110.6 | ) | | 252.8 |
| | 121.5 |
|
Interest Expense | | 15.1 |
| | 8.6 |
| | 60.2 |
| | 39.1 |
|
Interest Income | | 1.2 |
| | 2.5 |
| | 4.3 |
| | 7.9 |
|
Income (Loss) Before Taxes | | (28.0 | ) | | (116.7 | ) | | 196.9 |
| | 90.3 |
|
Provision for (Benefit from) Income Taxes | | (9.4 | ) | | (0.9 | ) | | 48.4 |
| | 54.2 |
|
Net Income (Loss) | | (18.6 | ) | | (115.8 | ) | | 148.5 |
| | 36.1 |
|
Less: Net Income Attributable to Noncontrolling Interests | | 0.7 |
| | 0.7 |
| | 5.2 |
| | 5.1 |
|
Net Income (Loss) Attributable to Regal Beloit Corporation | | $ | (19.3 | ) | | $ | (116.5 | ) | | $ | 143.3 |
| | $ | 31.0 |
|
Earnings (Loss) Per Share Attributable to Regal Beloit Corporation: | | | | | | | | |
Basic | | $ | (0.43 | ) | | $ | (2.61 | ) | | $ | 3.21 |
| | $ | 0.69 |
|
Assuming Dilution | | $ | (0.43 | ) | | $ | (2.61 | ) | | $ | 3.18 |
| | $ | 0.69 |
|
Cash Dividends Declared | | $ | 0.23 |
| | $ | 0.22 |
| | $ | 0.91 |
| | $ | 0.86 |
|
Weighted Average Number of Shares Outstanding: | | | | | | | | |
Basic | | 44.7 |
| | 44.7 |
| | 44.7 |
| | 45.0 |
|
Assuming Dilution | | 44.7 |
| | 44.7 |
| | 45.1 |
| | 45.3 |
|
|
| | | | | | | | |
CONDENSED CONSOLIDATED BALANCE SHEETS | | | | |
Unaudited | | | | |
(Dollars in Millions) | | | | |
| | Jan 2,
2016 | | Jan 3,
2015 |
ASSETS | | | | |
Current Assets: | | | | |
Cash and Cash Equivalents | | $ | 252.9 |
| | $ | 334.1 |
|
Trade Receivables, less Allowances
of $11.3 million in 2015 and $11.6 million in 2014 | | 461.9 |
| | 447.5 |
|
Inventories | | 775.0 |
| | 691.7 |
|
Prepaid Expenses and Other Current Assets | | 145.4 |
| | 111.2 |
|
Total Current Assets | | 1,635.2 |
| | 1,584.5 |
|
| | | | |
Net Property, Plant, Equipment and Noncurrent Assets | | 2,938.0 |
| | 1,754.8 |
|
Total Assets | | $ | 4,573.2 |
| | $ | 3,339.3 |
|
| | | | |
LIABILITIES AND EQUITY | | | | |
Current Liabilities: | | | | |
Accounts Payable | | $ | 336.2 |
| | $ | 312.2 |
|
Other Accrued Expenses | | 270.3 |
| | 240.7 |
|
Current Maturities of Debt | | 6.3 |
| | 7.8 |
|
Total Current Liabilities | | 612.8 |
| | 560.7 |
|
| | | | |
Long-Term Debt | | 1,715.6 |
| | 624.7 |
|
Other Noncurrent Liabilities | | 262.0 |
| | 174.6 |
|
Equity: | | | | |
Total Regal Beloit Corporation Shareholders' Equity | | 1,937.3 |
| | 1,934.4 |
|
Noncontrolling Interests | | 45.5 |
| | 44.9 |
|
Total Equity | | 1,982.8 |
| | 1,979.3 |
|
Total Liabilities and Equity | | $ | 4,573.2 |
| | $ | 3,339.3 |
|
|
| | | | | | | | | | | | | | | | |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOW | | | | | | | | |
Unaudited | | | | | | | | |
(Dollars in Millions) | | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
| | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 |
CASH FLOWS FROM OPERATING ACTIVITIES: | | | | | | | | |
Net income (loss) | | $ | (18.6 | ) | | $ | (115.8 | ) | | $ | 148.5 |
| | $ | 36.1 |
|
Adjustments to reconcile net income (loss) and changes in assets and liabilities (net of acquisitions) to net cash provided by operating activities: | | | | | | | | |
Depreciation and amortization | | 39.3 |
| | 35.1 |
| | 159.4 |
| | 138.7 |
|
Excess tax benefits from share-based compensation | | — |
| | (0.1 | ) | | (1.3 | ) | | (1.3 | ) |
Goodwill impairment | | 79.9 |
| | 118.5 |
| | 79.9 |
| | 119.5 |
|
Asset impairment and other, net | | — |
| | 40.0 |
| | — |
| | 40.0 |
|
Loss (gain) on disposal of assets, net | | 0.6 |
| | (10.5 | ) | | 2.4 |
| | (12.1 | ) |
Share-based compensation expense | | 3.3 |
| | 3.4 |
| | 13.9 |
| | 11.9 |
|
Loss on sale of consolidated joint venture | | — |
| | — |
| | — |
| | 1.9 |
|
Loss on Venezuela currency devaluation | | — |
| | 10.4 |
| | 1.5 |
| | 10.4 |
|
Change in operating assets and liabilities, net of acquisitions | | 9.4 |
| | (9.9 | ) | | (23.2 | ) | | (46.9 | ) |
Net cash provided by operating activities | | 113.9 |
| | 71.1 |
| | 381.1 |
| | 298.2 |
|
CASH FLOWS FROM INVESTING ACTIVITIES: | | | | | | | | |
Additions to property, plant and equipment | | (26.8 | ) | | (23.1 | ) | | (92.2 | ) | | (83.6 | ) |
Net (purchases) sales of investment securities | | (4.1 | ) | | 8.0 |
| | (9.8 | ) | | (1.9 | ) |
Business acquisitions, net of cash acquired | | (0.7 | ) | | — |
| | (1,401.4 | ) | | (128.2 | ) |
Additions of equipment on operating leases | | — |
| | (0.1 | ) | | — |
| | (4.6 | ) |
Proceeds from sale of consolidated joint venture | | — |
| | 0.2 |
| | — |
| | 0.9 |
|
Proceeds from sale of assets | | 8.0 |
| | 12.4 |
| | 15.8 |
| | 12.5 |
|
Net cash used in investing activities | | (23.6 | ) | | (2.6 | ) | | (1,487.6 | ) | | (204.9 | ) |
CASH FLOWS FROM FINANCING ACTIVITIES: | | | | | | | | |
Net (repayments) borrowings under revolving credit facility | | (13.0 | ) | | (43.0 | ) | | (14.0 | ) | | 17.0 |
|
Net proceeds (repayments) from short-term borrowings | | (4.1 | ) | | 0.5 |
| | (0.6 | ) | | 0.2 |
|
Proceeds from long-term debt | | — |
| | — |
| | 1,250.0 |
| | — |
|
Repayments of long-term debt | | (60.1 | ) | | (0.3 | ) | | (132.3 | ) | | (150.4 | ) |
Dividends paid to shareholders | | (10.3 | ) | | (9.8 | ) | | (40.2 | ) | | (37.8 | ) |
Payments of contingent consideration | | — |
| | (5.3 | ) | | — |
| | (13.9 | ) |
Proceeds from the exercise of stock options | | 0.3 |
| | 0.1 |
| | 4.1 |
| | 0.9 |
|
Excess tax benefits from share-based compensation | | — |
| | 0.1 |
| | 1.3 |
| | 1.3 |
|
Repurchase of common stock | | — |
| | — |
| | (12.0 | ) | | (35.0 | ) |
Distributions to noncontrolling interest | | — |
| | — |
| | (0.3 | ) | | (0.3 | ) |
Purchase of subsidiary shares from noncontrolling interest | | — |
| | — |
| | (1.4 | ) | | — |
|
Financing fees paid | | (0.2 | ) | | — |
| | (18.0 | ) | | — |
|
Net cash provided by (used in) financing activities | | (87.4 | ) | | (57.7 | ) | | 1,036.6 |
| | (218.0 | ) |
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS | | (4.6 | ) | | (4.0 | ) | | (11.3 | ) | | (7.2 | ) |
Net increase (decrease) in cash and cash equivalents | | (1.7 | ) | | 6.8 |
| | (81.2 | ) | | (131.9 | ) |
Cash and cash equivalents at beginning of period | | 254.6 |
| | 327.3 |
| | 334.1 |
| | 466.0 |
|
Cash and cash equivalents at end of period | | $ | 252.9 |
| | $ | 334.1 |
| | $ | 252.9 |
| | $ | 334.1 |
|
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
SEGMENT INFORMATION | | | | | | | | | | | | | | |
Unaudited | | | | | | | | | | | | | | | | |
(Dollars In Millions) | | | | | | | | | | | | | | |
| | Three Months Ended |
| | Commercial & Industrial Systems | | Climate Solutions | | Power Transmission Solutions | | Total Regal |
| | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 |
Net Sales | | $ | 370.7 |
| | $ | 451.2 |
| | $ | 210.3 |
| | $ | 256.2 |
| | $ | 192.5 |
| | $ | 68.2 |
| | $ | 773.5 |
| | $ | 775.6 |
|
| | | | | | | | | | | | | | | | |
Operating Margin | | (16.1 | )% | | (18.7 | )% | | 13.7 | % | | 2.8 | % | | 8.7 | % | | (49.1 | )% | | (1.8 | )% | | (14.2 | )% |
Adjusted Operating Margin Percentage* | | 9.5 | % | | 4.7 | % | | 13.2 | % | | 11.9 | % | | 8.7 | % | | 12.3 | % | | 10.3 | % | | 7.8 | % |
| | | | | | | | | | | | | | | | |
Components of Net Sales: | | | | | | | | | | | | | | | | |
Organic Sales Growth | | (14.0 | )% | | (1.9 | )% | | (16.5 | )% | | 9.2 | % | | (5.1 | )% | | 14.0 | % | | (14.0 | )% | | 3.0 | % |
Acquisitions, Net of Divestitures | | (0.2 | )% | | 8.1 | % | | — | % | | — | % | | 188.0 | % | | — | % | | 16.4 | % | | 4.8 | % |
Foreign Currency Impact | | (3.7 | )% | | (1.6 | )% | | (1.5 | )% | | (0.6 | )% | | (0.6 | )% | | (0.6 | )% | | (2.7 | )% | | (1.2 | )% |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
SEGMENT INFORMATION | | | | | | | | | | | | | | |
Unaudited | | | | | | | | | | | | | | | | |
(Dollars In Millions) | | | | | | | | | | | | | | |
| | Twelve Months Ended |
| | Commercial & Industrial Systems | | Climate Solutions | | Power Transmission Solutions | | Total Regal |
| | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 |
Net Sales | | $ | 1,694.9 |
| | $ | 1,856.1 |
| | $ | 1,041.2 |
| | $ | 1,134.8 |
| | $ | 773.6 |
| | $ | 266.2 |
| | $ | 3,509.7 |
| | $ | 3,257.1 |
|
| | | | | | | | | | | | | | | | |
Operating Margin | | 3.2 | % | | 1.8 | % | | 14.1 | % | | 8.8 | % | | 6.8 | % | | (4.4 | )% | | 7.2 | % | | 3.7 | % |
Adjusted Operating Margin Percentage* | | 9.1 | % | | 7.8 | % | | 13.9 | % | | 11.7 | % | | 10.7 | % | | 11.3 | % | | 10.9 | % | | 9.4 | % |
| | | | | | | | | | | | | | | | |
Components of Net Sales: | | | | | | | | | | | | | | | | |
Organic Sales Growth | | (6.3 | )% | | (0.2 | )% | | (6.7 | )% | | 3.5 | % | | (1.1 | )% | | 6.3 | % | | (6.0 | )% | | 1.6 | % |
Acquisitions, Net of Divestitures | | 1.5 | % | | 7.4 | % | | — | % | | — | % | | 192.6 | % | | — | % | | 16.6 | % | | 4.2 | % |
Foreign Currency Impact | | (3.9 | )% | | (0.9 | )% | | (1.6 | )% | | (0.2 | )% | | (1.0 | )% | | — | % | | (2.8 | )% | | (0.6 | )% |
NON-GAAP MEASURES AND OTHER DEFINITIONS
Unaudited
(Dollars in Millions)
We prepare financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”). We also periodically disclose certain financial measures in our quarterly earnings releases, on investor conference calls, and in investor presentations and similar events that may be considered “non-GAAP” financial measures. We believe that these non-GAAP financial measures are useful measures for providing investors with additional information regarding our results of operations and for helping investors understand and compare our operating results across accounting periods and compared to our peers. In addition, since our management often uses these non-GAAP financial measures to manage and evaluate our business, make operating decisions, and forecast our future results, we believe disclosing these measures helps investors evaluate our business in the same manner as management. This additional information is not meant to be considered in isolation or as a substitute for our results of operations prepared and presented in accordance with GAAP.
In this earnings release, we disclose the following non-GAAP financial measures, and we reconcile these measures in the tables below to the most directly comparable GAAP financial measures: adjusted diluted earnings per share (both historical and projected), adjusted operating profit, adjusted operating profit margin, free cash flow and free cash flow as a percentage of adjusted net income. Adjusted net income represents net income attributable to Regal Beloit Corporation, adjusted to exclude non-cash items of Goodwill Impairment, Asset Impairments and Other, Net, and the Venezuelan Asset Write Down.
In addition to these non-GAAP measures, we also use the term “organic sales” to refer to GAAP sales from existing operations excluding sales from acquired businesses recorded prior to the first anniversary of the acquisition less the amount of sales attributable to any divested businesses (“acquisition sales”), and the impact of foreign currency translation. The impact of foreign currency translation is determined by translating the respective period’s sales (excluding acquisition sales) using the same currency exchange rates that were in effect during the prior year periods. We use the term “organic sales growth” to refer to the increase in our sales between periods that is attributable to organic sales. We use the term “acquisition growth” to refer to the increase in our sales between periods that is attributable to acquisition sales.
|
| | | | | | | | | | | | | | | | |
| | | | | | | | |
| | | | | | | | |
ADJUSTED DILUTED EARNINGS PER SHARE | | Three Months Ended | | Twelve Months Ended |
| | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 |
Diluted Earnings (Loss) Per Share | | $ | (0.43 | ) | | $ | (2.61 | ) | | $ | 3.18 |
| | $ | 0.69 |
|
Goodwill Impairment 1 | | 1.30 |
| | 2.60 |
| | 1.29 |
| | 2.59 |
|
Asset Impairments and Other, Net | | — |
| | 0.67 |
| | — |
| | 0.66 |
|
Venezuelan Asset Write Down | | 0.29 |
| | — |
| | 0.28 |
| | — |
|
Purchase Accounting and Transaction Costs | | — |
| | 0.09 |
| | 0.47 |
| | 0.14 |
|
Restructuring Costs | | 0.06 |
| | 0.03 |
| | 0.13 |
| | 0.18 |
|
Venezuelan Currency Devaluation | | — |
| | 0.15 |
| | 0.02 |
| | 0.15 |
|
Gain on Disposal of Real Estate | | (0.05 | ) | | (0.20 | ) | | (0.04 | ) | | (0.23 | ) |
Loss on Divestiture Bankruptcy | | — |
| | 0.09 |
| | — |
| | 0.09 |
|
Loss on Sale of Joint Venture | | — |
| | — |
| | — |
| | 0.04 |
|
Adjusted Diluted Earnings Per Share | | $ | 1.17 |
| | $ | 0.82 |
| | $ | 5.33 |
| | $ | 4.31 |
|
| | | | | | | | |
| |
1. | Goodwill impairment is subject to finalization. |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
ADJUSTED OPERATING INCOME | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| | Three Months Ended |
| | Commercial & Industrial Systems | | Climate Solutions | | Power Transmission Solutions | | Total Regal |
| | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 |
Income (Loss) from Operations | | $ | (59.7 | ) | | $ | (84.2 | ) | | $ | 28.9 |
| | $ | 7.1 |
| | $ | 16.7 |
| | $ | (33.5 | ) | | $ | (14.1 | ) | | $ | (110.6 | ) |
Goodwill Impairment 1 | | 79.9 |
| | 99.7 |
| | — |
| | 7.7 |
| | — |
| | 11.1 |
| | 79.9 |
| | 118.5 |
|
Asset Impairments and Other, Net | | — |
| | — |
| | — |
| | 13.8 |
| | — |
| | 26.2 |
| | — |
| | 40.0 |
|
Venezuelan Asset Write Down | | 12.8 |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 12.8 |
| | — |
|
Purchase Accounting and Transaction Costs | | — |
| | 0.7 |
| | — |
| | — |
| | — |
| | 4.4 |
| | — |
| | 5.1 |
|
Restructuring Costs | | 2.1 |
| | 0.4 |
| | 2.2 |
| | 1.8 |
| | — |
| | 0.2 |
| | 4.3 |
| | 2.4 |
|
Venezuelan Currency Devaluation | | — |
| | 10.4 |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 10.4 |
|
Gain on Disposal of Real Estate | | — |
| | (11.9 | ) | | (3.4 | ) | | — |
| | — |
| | — |
| | (3.4 | ) | | (11.9 | ) |
Loss on Divestiture Bankruptcy | | — |
| | 6.3 |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 6.3 |
|
Adjusted Income from Operations | | $ | 35.1 |
| | $ | 21.4 |
| | $ | 27.7 |
| | $ | 30.4 |
| | $ | 16.7 |
| | $ | 8.4 |
| | $ | 79.5 |
| | $ | 60.2 |
|
|
| | | | | | | | | | | | | | | | | | |
GAAP Operating Margin % | | (16.1)% | | (18.7)% | | 13.7% | | 2.8% | | 8.7% | | (49.1)% | | (1.8 | )% | | (14.2 | )% |
Adjusted Operating Margin % | | 9.5% | | 4.7% | | 13.2% | | 11.9% | | 8.7% | | 12.3% | | 10.3 | % | | 7.8 | % |
| |
1. | Goodwill impairment is subject to finalization. |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
ADJUSTED OPERATING INCOME | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| | Twelve Months Ended |
| | Commercial & Industrial Systems | | Climate Solutions | | Power Transmission Solutions | | Total Regal |
| | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 |
Income from Operations | | $ | 53.9 |
| | $ | 33.6 |
| | $ | 146.7 |
| | $ | 99.6 |
| | $ | 52.2 |
| | $ | (11.7 | ) | | $ | 252.8 |
| | $ | 121.5 |
|
Goodwill Impairment 1 | | 79.9 |
| | 100.7 |
| | — |
| | 7.7 |
| | — |
| | 11.1 |
| | 79.9 |
| | 119.5 |
|
Asset Impairments and Other, Net | | — |
| | — |
| | — |
| | 13.8 |
| | — |
| | 26.2 |
| | — |
| | 40.0 |
|
Purchase Accounting and Transaction Costs | | — |
| | 4.0 |
| | — |
| | — |
| | 29.8 |
| | 4.4 |
| | 29.8 |
| | 8.4 |
|
Venezuelan Asset Write Down | | 12.8 |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 12.8 |
| | — |
|
Restructuring Costs | | 6.8 |
| | 1.6 |
| | 1.5 |
| | 11.4 |
| | 0.6 |
| | 0.2 |
| | 8.9 |
| | 13.2 |
|
Venezuelan Currency Devaluation | | 1.5 |
| | 10.4 |
| | — |
| | — |
| | — |
| | — |
| | 1.5 |
| | 10.4 |
|
Gain on Disposal of Real Estate | | — |
| | (13.9 | ) | | (3.4 | ) | | — |
| | — |
| | — |
| | (3.4 | ) | | (13.9 | ) |
Loss on Sale of Joint Venture | | — |
| | 1.9 |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 1.9 |
|
Loss on Divestiture Bankruptcy | | — |
| | 6.3 |
| | — |
| | — |
| | — |
| | — |
| | — |
| | 6.3 |
|
Adjusted Income from Operations | | $ | 154.9 |
| | $ | 144.6 |
| | $ | 144.8 |
| | $ | 132.5 |
| | $ | 82.6 |
| | $ | 30.2 |
| | $ | 382.3 |
| | $ | 307.3 |
|
|
| | | | | | | | | | | | | | | | | | |
GAAP Operating Margin % | | 3.2% | | 1.8% | | 14.1% | | 8.8% | | 6.8% | | (4.4)% | | 7.2 | % | | 3.7 | % |
Adjusted Operating Margin % | | 9.1% | | 7.8% | | 13.9% | | 11.7% | | 10.7% | | 11.3% | | 10.9 | % | | 9.4 | % |
| |
1. | Goodwill impairment is subject to finalization. |
|
| | | | | | | | | | | | | | | | |
FREE CASH FLOW RECONCILIATION | | Three Months Ended | | Twelve Months Ended |
| | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 |
Net Cash Provided by Operating Activities | | $ | 113.9 |
| | $ | 71.1 |
| | $ | 381.1 |
| | $ | 298.2 |
|
Additions to Property Plant and Equipment | | (26.8 | ) | | (23.1 | ) | | (92.2 | ) | | (83.6 | ) |
Free Cash Flow | | $ | 87.1 |
| | $ | 48.0 |
| | $ | 288.9 |
| | $ | 214.6 |
|
Free Cash Flow as a Percentage of Adjusted Net Income | | 168.8 | % | | 161.6 | % | | 134.9 | % | | 120.4 | % |
|
| | | | | | | | | | | | | | | | |
| | Three Months Ended | | Twelve Months Ended |
ADJUSTED NET INCOME | | Jan 2,
2016 | | Jan 3,
2015 | | Jan 2,
2016 | | Jan 3,
2015 |
GAAP Net Income (Loss) Attributable to Regal Beloit Corporation | | $ | (19.3 | ) | | $ | (116.5 | ) | | $ | 143.3 |
| | $ | 31.0 |
|
Goodwill Impairment 1 | | 79.9 |
| | 118.5 |
| | 79.9 |
| | 119.5 |
|
Asset Impairments and Other, Net | | — |
| | 40.0 |
| | — |
| | 40.0 |
|
Venezuelan Asset Write Down | | 12.8 |
| | — |
| | 12.8 |
| | — |
|
Tax Effect from Goodwill Impairment and Asset Impairments and Other, Net | | (21.8 | ) | | (12.3 | ) | | (21.8 | ) | | (12.3 | ) |
Adjusted Net Income | | $ | 51.6 |
| | $ | 29.7 |
| | $ | 214.2 |
| | $ | 178.2 |
|
| |
1. | Goodwill impairment is subject to finalization. |
|
| | | | | | | | |
RECONCILIATION OF 2016 ADJUSTED ANNUAL GUIDANCE | | Minimum | | Maximum |
2016 EPS Annual Guidance | | $ | 4.66 |
| | $ | 5.06 |
|
Restructuring | | 0.14 |
| | 0.14 |
|
2016 Adjusted EPS Annual Guidance | | $ | 4.80 |
| | $ | 5.20 |
|
|
| | | | | | | | |
ORGANIC GROWTH | | Three Months Ended | | Twelve Months Ended |
| | Jan 2,
2016 | | Jan 2,
2016 |
Net Sales | | $ | 773.5 |
| | $ | 3,509.7 |
|
Net Sales from Businesses Acquired | | (128.2 | ) | | (552.5 | ) |
Impact from Foreign Currency Exchange Rates | | 20.7 |
| | 92.0 |
|
Net Sales from Businesses Divested | | 1.0 |
| | 11.5 |
|
Adjusted Net Sales | | $ | 667.0 |
| | $ | 3,060.7 |
|
| | | | |
Net Sales Three and Twelve Months Ended January 3, 2015 | | $ | 775.6 |
| | $ | 3,257.1 |
|
| | | | |
Organic Growth % | | (14.0 | )% | | (6.0 | )% |
Regal Beloit Corporation Fourth Quarter 2015 Earnings Conference Call February 9, 2016 Mark Gliebe Chairman and Chief Executive Officer Jon Schlemmer Chief Operating Officer Chuck Hinrichs Vice President Chief Financial Officer Robert Cherry Vice President Investor Relations
Safe Harbor Statement This presentation contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent our management’s judgment regarding future events. In many cases, you can identify forward-looking statements by terminology such as “may,” “will,” “plan,” “expect,” “anticipate,” “estimate,” “believe,” or “continue” or the negative of these terms or other similar words. Actual results and events could differ materially and adversely from those contained in the forward-looking statements due to a number of factors, including: uncertainties regarding our ability to execute our restructuring plans within expected costs and timing; increases in our overall debt levels as a result of the acquisition of the Power Transmission Solutions (“PTS”) business from Emerson Electric Co., or otherwise and our ability to repay principal and interest on our outstanding debt; actions taken by our competitors and our ability to effectively compete in the increasingly competitive global electric motor, power generation and mechanical motion control industries; our ability to develop new products based on technological innovation and the marketplace acceptance of new and existing products; fluctuations in commodity prices and raw material costs; our dependence on significant customers; issues and costs arising from the integration of acquired companies and businesses such as the PTS acquisition, including the timing and impact of purchase accounting adjustments; unanticipated costs or expenses we may incur related to product warranty issues; currency devaluations, non-payment of receivables, governmental restrictions such as price and margin controls, or other difficult operating conditions relating to our doing business in Venezuela; our dependence on key suppliers and the potential effects of supply disruptions; infringement of our intellectual property by third parties, challenges to our intellectual property, and claims of infringement by us of third party technologies; product liability and other litigation, or the failure of our products to perform as anticipated, particularly in high volume applications; economic changes in global markets where we do business, such as reduced demand for the products we sell, currency exchange rates, inflation rates, interest rates, recession, foreign government policies and other external factors that we cannot control; unanticipated liabilities of acquired businesses; affect on earnings of any significant impairment of goodwill or intangible assets; cyclical downturns affecting the global market for capital goods; difficulties associated with managing foreign operations; and other risks and uncertainties including but not limited to those described in Item 1A-Risk Factors of the Company’s Annual Report on Form 10-K filed on March 4, 2015 and from time to time in our reports filed with U.S. Securities and Exchange Commission. All subsequent written and oral forward-looking statements attributable to us or to persons acting on our behalf are expressly qualified in their entirety by the applicable cautionary statements. The forward-looking statements included in this presentation are made only as of their respective dates, and we undertake no obligation to update these statements to reflect subsequent events or circumstances. p 2
Non-GAAP Financial Measures p 3 We prepare financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”). We also periodically disclose certain financial measures in our quarterly earnings releases, on investor conference calls, and in investor presentations and similar events that may be considered “non-GAAP” financial measures. We believe that these non-GAAP financial measures are useful measures for providing investors with additional information regarding our results of operations and for helping investors understand and compare our operating results across accounting periods and compared to our peers. In addition, since our management often uses these non-GAAP financial measures to manage and evaluate our business, make operating decisions, and forecast our future results, we believe disclosing these measures helps investors evaluate our business in the same manner as management. This additional information is not meant to be considered in isolation or as a substitute for our results of operations prepared and presented in accordance with GAAP. In this earnings release, we disclose the following non-GAAP financial measures, and we reconcile these measures in the tables below to the most directly comparable GAAP financial measures: adjusted diluted earnings per share (both historical and projected), adjusted operating profit, adjusted operating profit margin, free cash flow and free cash flow as a percentage of adjusted net income. Adjusted net income represents net income attributable to Regal Beloit Corporation adjusted to exclude non-cash items of Goodwill Impairment, Asset Impairments and Other, Net and the Venezuelan Asset Write Down. In addition to these non-GAAP measures, we also use the term “organic sales” to refer to GAAP sales from existing operations excluding sales from acquired businesses recorded prior to the first anniversary of the acquisition less the amount of sales attributable to any divested businesses (“acquisition sales”), and the impact of foreign currency translation. The impact of foreign currency translation is determined by translating the respective period’s sales (excluding acquisition sales) using the same currency exchange rates that were in effect during the prior year periods. We use the term “organic sales growth” to refer to the increase in our sales between periods that is attributable to organic sales. We use the term “acquisition growth” to refer to the increase in our sales between periods that is attributable to acquisition sales.
Agenda Opening Comments Mark Gliebe Financial Update Chuck Hinrichs Segment Update Jon Schlemmer Summary Mark Gliebe Q&A All p 4
Opening Comments 4th Quarter Results 4th Quarter Highlights Increased Adjusted Operating Margin* to 10.3%, Up 250 Basis Points Over Prior Year Adjusted Earnings Per Share* Up 43% Free Cash Flow* 169% of Adjusted Net Income*, Paid Down Debt by $77 Million [VALUE] $774 $127 ($21) ($109) 4Q 2014 Net Acquisitions F/X Organic Growth 4Q 2015 5 Fewer Days 4th Quarter 2015 Sales Bridge * Non-GAAP Financial Measurement, See Appendix for Reconciliation p 5
> Commercial & Industrial Systems – Organic Sales Down 14% Five Fewer Shipping Days Steep Reduction in Oil & Gas and Weak Demand in China Adjusted Operating Margin* Up 480 Basis Points > Climate Solutions – Organic Sales Down 16.5% Five Fewer Shipping Days SEER 13 Pre-Build, Two-Way Material Price Formulas and Weaker Sales as a Result of a Warmer Winter Adjusted Operating Margin* Up 130 Basis Points > Power Transmission Solutions – Acquisition Contributed $128 Million Organic Sales Down 5.1% with Headwinds in Oil & Gas Partially Offset by Strength in Renewable Energies Opening Comments 4th Quarter Results p 6 * Non-GAAP Financial Measurement, See Appendix for Reconciliation
PTS Integration Essentially Complete > Consolidated the Canadian Sites in 4Q 2015 > ERP Integrated by 3Q 2016 > Delivered $12 Million of Synergies Against the Target of $7 Million > Expect to Achieve $30 Million Synergy Target Over a Three-Year Period Opening Comments 4th Quarter Results p 7 Combined Regal Canadian Team Canadian Warehouse Consolidation
> 2016 Outlook Expecting Difficult End Markets Comparisons to Improve in 2nd Half of 2016 > Key Management Focus Continued Margin Improvement Sales Growth Despite Difficult End Markets Improve Working Capital Management p 8 Simplification Initiative Positions Regal to Perform in Difficult Markets Looking Forward
> Sales of $773.5 Million, Essentially Flat – Net Acquisition Growth of 16.4% – Foreign Currency Translation of (2.7%) – Organic Sales (14%) – Approx. Half Resulting from 5 Fewer Shipping Days > Adjusted Operating Profit Margin* of 10.3%, Up 250 Basis Points from Prior Year – Contribution of Simplification Benefits, Process Improvements and Cost Controls – Lower Materials Costs and LIFO Benefit – $10 Million Prior Year A/R Reserve 4th Quarter 2015 Financial Results p 9 * Non-GAAP Financial Measurement, See Appendix for Reconciliation Fourth Consecutive Quarter of Adjusted Op Profit Improvement
4th Quarter 2015 Financial Resul p 10 Adjusted Diluted EPS* Up $0.35 or 43% * Non-GAAP Financial Measurement, See Appendix for Reconciliation ADJUSTED DILUTED EARNINGS PER SHARE Jan 2, 2016 Jan 3, 2015 GAAP Diluted Earnings Per Share (0.43)$ (2.61)$ Goodwill Impairment 1 1.30 2.60 Other Impairments, Net - 0.67 Venezuela Asset Write Down 0.29 - Purchase Accounting and Transaction Costs - 0.09 Restructuring Costs 0.06 0.03 Venezuelan Currency Devaluation - 0.15 Gain on Disposal of Real Estate (0.05) (0.20) Loss on Divestiture Bankruptcy - 0.09 Adjusted Diluted Earnings Per Share 1.17$ 0.82$ 1. Goodwill impairment is subject to finalization. Three Months Ended
Capital Expenditures > $27 Million in 4Q 2015 > $92 Million in FY 2015 > $85 Million Expected in FY 2016 Effective Tax Rate (ETR) Balance Sheet at Jan 2, 2016 > Total Debt of $1,722 Million > Net Debt of $1,469 Million > 4Q 2015 Debt Reduction of $77 Million > Reduced Total Debt by $213 Million Since the PTS Acquisition 4th Quarter 2015 Key Financial Metrics Free Cash Flow* > $87 Million in 4Q 2015 > 169% of Adj. Net Income in 4Q 2015 > $289 Million FY 2015 > 135% of Adj. Net Income FY 2015 p 11 > 24.6% ETR in FY 2015 > Expect 25% ETR for FY 2016 * Non-GAAP Financial Measurement, See Appendix for Reconciliation
0% 20% 40% 60% 80% 100% 120% 140% $- $50 $100 $150 $200 $250 $300 $350 2011 2012 2013 2014 2015 Free Cash Flow* % of Adj. Net Income* Free Cash Flow Trend Five Consecutive Years of FCF Above 100% of Adj. Net Income * Non-GAAP Financial Measurement, See Appendix for Reconciliation p 12
2016 Full Year Guidance > 2016 Sales Impacted by Continuation of Weak End Market Demand > F/X Estimated to Be a 1%-2% Headwind on 2016 Sales > Guidance Does Not Include Debt Refinancing in 2016 > 2016 Restructuring Expenses Estimated at $10 Million > Full Year 2016 GAAP EPS Guidance of $4.66 to $5.06 > Full Year 2016 Adjusted EPS* Guidance of $4.80 to $5.20 p 13 * Non-GAAP Financial Measurement, See Appendix for Reconciliation
Margin Improvement Progress 9.4% 10.7% 9.7% 7.8% 9.4% 9.8% 11.9% 11.5% 10.3% 10.9% 1Q 2Q 3Q 4Q FY 2014 2015 Adj. Operating Profit Margin* Key Drivers to 4Q Performance > $10 Million Prior Year A/R Reserve > $9 Million LIFO, Simplification, Process Improvements and Cost Controls Simplification & PTS Synergy Update > Accelerating All Programs > Recently Announced Four Additional Programs – Expect Further Announcements > Expect 2016 Restructuring of $10 Million > Synergies Exceeded Year One Target Delivering Margin Improvement in Difficult Market Conditions * Non-GAAP Financial Measurement, See Appendix for Reconciliation p 14
$451 $371 $0.0 $0.0 ($17) ($63) Prior Year FX Organic Current Year Commercial & Industrial Systems p 15 * Management Estimates Based on Sales Per Day ** Non-GAAP Financial Measurement, See Appendix for Reconciliation (millions) 5 Less Days* Oil & Gas China Power Gen Distribution Data Centers Pool Pump Adjusted Operating Margin Improved by 480 Basis Points ($31) ($27) 4Q Sales Versus Prior Year Adj. Operating Margin** 9.5% > Up 480 Basis Points from Prior Year > Operating Profit Improvement $10 Million Prior Year A/R Reserve Simplification Benefits Benefits from Lower Commodity Costs and LIFO
SyMAX-i > Motor/Drive System > ~20% More Energy Efficient > Used in Commercial HVAC and Commercial Refrigeration Applications p 16 AHR Expo in Orlando Delivering Energy Efficiency Solutions for Building Applications
$256 $210 $0.0 $0.0 ($4) ($42) Prior Year FX Organic Current Year Climate Solutions p 17 * Management Estimates Based on Sales Per Day ** Non-GAAP Financial Measurement, See Appendix for Reconciliation (millions) 5 Less Days* Price / MPF SEER 13 Warm Weather Adjusted Operating Margin Improved by 130 Basis Points 4Q Sales Versus Prior Year Adj. Operating Margin** 13.2% > Up 130 Basis Points from Prior Year Benefits of Simplification LIFO Benefits Cost Reduction Efforts ($18)
DEC Star > Smaller, Lighter, Quieter > 14% Better Efficiency > Lower Total Systems Cost p 18 AHR Expo in Orlando Standard Delivering Energy Efficiency Solutions to Meet Tougher Regulations
End Markets - Total Segment Adj. Operating Margin** 8.7% > Downward Pressure from Volume Declines > PTS Synergies Help to Offset Impact from Volume Declines Entering 2016 Power Transmission Solutions p 19 * Management Estimates Based on Sales Per Day ** Non-GAAP Financial Measurement, See Appendix for Reconciliation (millions) Oil & Gas Ag Equipment Distribution PTS Integration Near Completion and Synergies Exceeded Year One Target 4Q Sales Versus Prior Year Food & Beverage Material Handling Renewable Energy $68 $193 $0 $128 $0 ($0) $0 ($4) Prior Year FX Acquisition Organic Current Year ($5) 5 Fewer Days*
PTS Customer Service – Florence KY p 20 > Trained in 3Q 2015 > Went Live 4Q 2015 > Focused on PT Distribution Reinvesting in Our Power Transmission Segment to Grow!
4th Quarter Summary 4th Quarter Results > Sales Essentially Flat > Adjusted Operating Profit Margin* Up 250 Basis Points > PTS Integration Practically Complete – Synergies Exceeded Year 1 Target > Free Cash Flow* 169% of Adjusted Net Income, Paid Down $77 Million Debt p 21 * Non-GAAP Financial Measurement, See Appendix for Reconciliation
p 22 2014 2015 2014 2015 2014 2015 $3,257 $3,510 $307 $382 $215 $289 (millions) Sales Adj. Op Profit* Free Cash Flow* Full Year 2015 Results 2015 Full Year Summary * Non-GAAP Financial Measurement, See Appendix for Reconciliation Strong Execution on Key Objectives
2015 Full Year Summary > Delivered on Two Key Goals Adjusted Op Margin up 150 Basis Points PTS Integration Essentially Complete > Simplification Accomplishments Consolidated Six More Factories Executed Another Engineering Platform Consolidation Exited Five More Warehouses Converted Five More ERPs > Launched 45 New Products, Customer Survey Scores Improved and Received Five Awards from Key Customers > Regal Simplification Efforts at Full Stride p 23 Regal Delivers Record Sales and Record Adjusted Earnings* in 2015 * Non-GAAP Financial Measurement, See Appendix for Reconciliation
Questions and Answers p 24
p 25 Appendix Non-GAAP Reconciliations ADJUSTED DILUTED EARNINGS PER SHARE Jan 2, 2016 Jan 3, 2015 Jan 2, 2016 Jan 3, 2015 GAAP Diluted Earnings Per Share (0.43)$ (2.61)$ 3.18$ 0.69$ Goodwill Impairment 1 1.30 2.60 1.29 2.59 Other Impairments, Net - 0.67 - 0.66 Venezuela Asset Write Down 0.29 - 0.28 - Purchase Accounting and Transaction Costs - 0.09 0.47 0.14 Restructuring Costs 0.06 0.03 0.13 0.18 Venezuelan Currency Devaluation - 0.15 0.02 0.15 Gain on Disposal of Real Estate (0.05) (0.20) (0.04) (0.23) Loss on Divestiture Bankruptcy - 0.09 - 0.09 Loss on Sale of Joint Venture - - - 0.04 Adjusted Diluted Earnings Per Share 1.17$ 0.82$ 5.33$ 4.31$ 1. Goodwill impairment is subject to finalization. Three Months Ended Twelve Months Ended
p 26 Appendix Non-GAAP Reconciliations RECONCILIATION OF 2016 ADJUSTED ANNUAL GUIDANCE Minimum Maximum 2016 EPS Annual Guidance 4.66$ 5.06$ Restructuring 0.14 0.14 2016 Adjusted EPS Annual Guidance 4.80$ 5.20$
ADJUSTED INCOME FROM OPERATIONS Jan 2, 2016 Jan 3, 2015 Jan 2, 2016 Jan 3, 2015 Jan 2, 2016 Jan 3, 2015 Jan 2, 2016 Jan 3, 2015 GAAP Income from Operations (59.7)$ (84.2)$ 28.9$ 7.1$ 16.7$ (33.5)$ (14.1)$ (110.6)$ Goodwill Impairment 1 79.9 99.7 - 7.7 - 11.1 79.9 118.5 Asset Impairments and Other, Net - - - 13.8 - 26.2 - 40.0 Venezuelan Asset Write Down 12.8 - - - - - 12.8 - Purchase Accounting and Transaction Costs - 0.7 - - - 4.4 - 5.1 Restructuring Costs (Benefit) 2.3 0.4 2.2 1.8 - 0.2 4.3 2.4 Venezuelan Currency Devaluation - 10.4 - - - - - 10.4 Gain on Disposal of Real Estate - (11.9) (3.4) - - - (3.4) (11.9) Loss on Divestiture Bankruptcy - 6.3 - - - - - 6.3 Adjusted Income from Operations 35.3$ 21.4$ 27.7$ 30.4$ 16.7$ 8.4$ 79.5$ 60.2$ GAAP Operating Margin % (16.1)% (18.7)% 13.7 % 2.8 % 8.7 % (49.1)% (1.8)% (14.2)% Adjusted Operating Margin % 9.5 % 4.7 % 13.2 % 11.9 % 8.7 % 12.3 % 10.3 % 7.8 % 1. Goodwill impairment is subject to finalization. ADJUSTED INCOME FROM OPERATIONS Jan 2, 2016 Jan 3, 2015 Jan 2, 2016 Jan 3, 2015 Jan 2, 2016 Jan 3, 2015 Jan 2, 2016 Jan 3, 2015 GAAP Income from Operations 53.9$ 33.6$ 146.7$ 99.6$ 52.2$ (11.7)$ 252.8$ 121.5$ Goodwill Impairment 1 79.9 100.7 - 7.7 - 11.1 79.9 119.5 Asset Impairments and Other, Net - - - 13.8 - 26.2 - 40.0 Venezuelan Asset Write Down 12.8 - - - - - 12.8 - Purchase Accounting and Transaction Costs - 4.0 - - 29.8 4.4 29.8 8.4 Restructuring Costs 6.8 1.6 1.5 11.4 0.6 0.2 8.9 13.2 Venezuelan Currency Devaluation1 1.5 10.4 - - - - 1.5 10.4 Gain on Disposal of Real Estate - (13.9) (3.4) - - - (3.4) (13.9) Loss on Divestiture Bankruptcy - 6.3 - - - - - 6.3 Loss on Sale of Joint Venture - 1.9 - - - - - 1.9 Adjusted Income from Operations 154.9$ 144.6$ 144.8$ 132.5$ 82.6$ 30.2$ 382.3$ 307.3$ — GAAP Operating Margin % 3.2 % 1.8 % 14.1 % 8.8 % 6.8 % (4.4)% 7.2 % 3.7 % Adjusted Operating Margin % 9.1 % 7.8 % 13.9 % 11.7 % 10.7 % 11.3 % 10.9 % 9.4 % 1. Goodwill impairment is subject to finalization. Three Months Ended Commercial & Industrial Systems Climate Solutions Power Transmission Solutions Total Regal Twelve Months Ended Commercial & Industrial Systems Climate Solutions Power Transmission Solutions Total Regal Dollars in Millions p 27 Dollars in Millions Appendix Non-GAAP Reconciliations
Dollars in Millions p 28 FREE CASH FLOW Jan 2, 2016 Jan 3, 2015 Jan 2, 2016 Jan 3, 2015 GAAP Net Cash Provided by Operating Activities 113.9$ 71.1$ 381.1$ 298.2$ Additions to Property Plant and Equipment (26.8) (23.1) (92.2) (83.6) Free Cash Flow 87.1$ 48.0$ 288.9$ 214.6$ Free Cash Flow as a Percentage of Adjusted Net Income 168.8 % 161.6 % 134.9 % 120.4 % Three Months Ended Twelve Months EndedAppendix Non-GAAP Reconciliations ADJUSTED NET INCOME Jan 2, 2016 Jan 3, 2015 Jan 2, 2016 Jan 3, 2015 GAAP Net Income (Loss) Attributable to Regal Beloit Corporation (19.3)$ (116.5)$ 143.3$ 1.0$ oodwill Imp irment 1 79.9 118.5 79.9 11 .5 ss t Impairments and Other, Net — 40.0 — 40.0 Venezuelan Asset Writ Down 12.8 — 12.8 — Tax Effect from Goodwill Impairment and Asset Impairments and Other, Net (21.8) (12.3) (21.8) (12.3) Adjusted Net Income 51.6$ 29.7$ 214.2$ 178.2$ 1. Goodwill impairment is subject to finalization. Three Months Ended Twelve Months Ended Dollars in Millions
p 29 ORGANIC GROWTH Three Months Ended Twelve Months Ended Net Sales 773.5$ 3,509.7$ Net Sales from Businesses Acquired (128.2) (552.5) Impact from Foreign Currency Exchange Rates 20.7 92.0 Net Sales from Businesses Divested 1.0 11.5 Adjusted Net Sales 667.0$ 3,060.7$ Net Sales Three and Twelve Months Ended January 3, 2015 775.6$ 3,257.1$ Organic Growth % (14.0)% (6.0)% Jan 2, 2016 Dollars in Millions Appendix Non-GAAP Reconciliations
Appendix Regal Shipping Days p 30 1Q 2Q 3Q 4Q FY 2014 63 63 63 64 253 2015 64 63 64 59 250 2016 64 64 63 60 251 > Regal operates on a 52/53 week fiscal year ending on the Saturday closest to December 31 > Fiscal Years 2015 and 2016 have 52 weeks > Fiscal Year 2014 had 53 weeks
RBC Bearings (NYSE:RBC)
과거 데이터 주식 차트
부터 6월(6) 2024 으로 7월(7) 2024
RBC Bearings (NYSE:RBC)
과거 데이터 주식 차트
부터 7월(7) 2023 으로 7월(7) 2024
