DAYTON, Ohio, Jan. 7 /PRNewswire-FirstCall/ -- Robbins & Myers, Inc. today reported diluted net earnings per share (DEPS) of $0.50 for its fiscal first quarter ended November 30, 2008, as compared with $0.40 in the prior year first quarter. First quarter 2009 sales increased 3% over the prior year first quarter to $178 million, and orders decreased 5% to $185 million. Excluding the impact from acquired product lines and currency translation, organic sales increased 6% and organic orders increased 4%. The Company experienced a significant strengthening of the US Dollar relative to the currencies of its primary non-US operations.
The Company reported first quarter 2009 earnings before interest, taxes and minority interest (EBIT) of $26 million, 14% higher than the prior year first quarter results, and EBIT margins expanded 140 basis points to 14.8%. Robbins & Myers also reported $30 million of EBITDA in the first quarter of 2009 and $141 million of adjusted EBITDA for the trailing twelve months. Cash flow from operations reflected a $6 million increase over the prior year first quarter, including improvements in net working capital. Capital expenditures were reduced 31% on a comparative basis.
In October 2008, the Company's Board of Directors authorized the repurchase of up to three million of its currently outstanding common shares. The Company announced it repurchased, as treasury shares, approximately two million of its common shares during the quarter for total cash consideration of $39 million. The current authorization allows for the repurchase of approximately one million additional common shares. Share repurchases contributed less than $0.01 to first quarter 2009 DEPS.
"I am pleased to report favorable first quarter results, led by sales of products targeting energy and chemical markets," said Peter C. Wallace, President and Chief Executive Officer of Robbins & Myers, Inc. "Our results also demonstrate the benefits resulting from changes made over the past few years to improve our customer value proposition, operating effectiveness and financial position. Many opportunities remain for continuous improvement across our global business."
"Despite strong first quarter results, most of our product lines experienced order declines late in the quarter, thus providing a cautionary tone as we enter our second quarter. We responded to this initial change in business conditions by reducing discretionary spending, deferring certain capital expenditures and developing plans to further adjust our cost structure. At the same time, we continue to pursue our key 2009 objectives to implement lean, develop our people, invest in our selling efforts, develop new products and applications, and pursue modest acquisitions."
"Robbins & Myers remains financially secure with $74 million of cash, an undrawn senior credit facility, and $33 million of debt. We have revised our expectations for the full year to reflect recent changes in order levels, unfavorable global economic conditions and currency translation headwinds, mitigated somewhat by announced share repurchases and efforts to reduce costs."
The Company announced fiscal 2009 DEPS expectations of $1.80-$2.00, which includes approximately $0.11 of benefit from recent share repurchases. The Company also expects fiscal second quarter 2009 DEPS of $0.40-$0.50, as compared with actual results of $0.47 in the second quarter of fiscal 2008, which included $0.04 of benefits from a facility sale and tax benefits.
First Quarter Results by Segment
All comparisons are made against the comparable year-ago quarterly period unless otherwise stated.
The Fluid Management segment reported first quarter 2009 sales of $82 million, an increase of 14%, and orders of $84 million, a 2% increase. Excluding currency exchange rate effects, organic sales increased 18% and organic orders improved 8% due to favorable demand for products serving energy markets, offset somewhat by weakness in municipal and industrial end markets. EBIT grew 34% to $25 million, and EBIT margins expanded 450 basis points to 30.0%.
The Process Solutions segment reported sales of $72 million in the first quarter, an increase of 2%, and orders of $74 million, a 5% decrease. Excluding the effects of currency exchange rates and an acquisition, organic sales increased 4% and organic orders increased 6%. Several orders for large chemical market projects were secured during the quarter. The segment earned $7 million of EBIT in the first quarter of 2009, and EBIT margins decreased 170 basis points to 9.5% due to an unfavorable product mix, higher project costs and increased operating expenses.
The Romaco segment reported first quarter sales of $23 million, a 23% decrease, and orders of $27 million, down 21%. Excluding the impact from currency exchange rates, organic sales decreased 17% and orders declined 8% on weakness in pharmaceutical markets and order delays. Romaco reported an EBIT loss of $1.4 million during the first quarter of 2009, including $0.5 million of restructuring costs, as compared with EBIT of $1.5 million in the prior year.
Conference Call to Be Held Tomorrow, January 8 at 10:00 AM (EST)
A conference call to discuss these results has been scheduled for 10:00 AM ET Thursday, January 8, 2009, which can be accessed at http://www.robn.com/ or by dialing 800-599-9795 (US/Canada) or +1-617-786-2905, using conference ID #14345248. Replays of the call can be accessed by dialing 888-286-8010 (U.S./Canada) or +1-617-801-6888, both using replay ID # 25121411.
About Robbins & Myers
Robbins & Myers, Inc. is a leading supplier of engineered equipment and systems for critical applications in global energy, industrial, chemical and pharmaceutical markets.
In this release the Company refers to various non-GAAP measures, including EBIT, EBITDA (earnings before interest, taxes, depreciation and amortization) and adjusted EBITDA. The Company uses these measures to evaluate its performance and believes these measures are helpful to investors in assessing its performance. Reconciliations of these measures to comparable GAAP measures are provided further below in this release.
In addition to historical information, this press release contains forward-looking statements identified by use of words such as "expects," "anticipates," "believes," and similar expressions. These statements reflect management's current expectations and involve known and unknown risks, uncertainties, contingencies and other factors that could cause actual results, performance or achievements to differ materially from those stated. The most significant of these risks and uncertainties are described in our Form 10-K and Form 10-Q reports filed with the Securities and Exchange Commission and include, but are not limited to: the cyclical nature of some of our markets; a significant decline in capital expenditures in our primary markets; a major decline in oil and natural gas prices; reduced demand due to the general worldwide economic downturn and general credit market crises; increases in competition; changes in the availability and cost of our raw materials; foreign exchange rate fluctuations; work stoppages related to union negotiations; customer order cancellations; business disruptions caused by the implementation of business computer systems; the possibility of product liability lawsuits that could harm our business; events or circumstances which result in an impairment of assets; the potential impact of U.S. and foreign legislation, government regulations, and other governmental action, including those relating to export and import of products and materials, and changes in the interpretation and application of such laws and regulations; the outcome of audit, compliance, administrative or investigatory reviews; and decline in the market value of our pension plans' investment portfolios affecting our financial condition and results of operations. Except as otherwise required by law, we do not undertake any obligation to publicly update or revise these forward-looking statements to reflect events or circumstances after the date hereof.
ROBBINS & MYERS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) (in thousands) November 30, 2008 August 31, 2008 ASSETS Current Assets: Cash and cash equivalents $74,337 $123,405 Accounts receivable 132,857 153,648 Inventories 115,648 109,797 Other current assets 5,559 8,017 Deferred taxes 9,961 13,476 Total Current Assets 338,362 408,343 Goodwill & Other Intangible Assets 260,384 285,759 Deferred Taxes 21,398 21,969 Other Assets 10,603 10,931 Property, Plant & Equipment 127,444 137,715 $758,191 $864,717 LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts payable $66,403 $86,012 Accrued expenses 87,951 102,876 Current portion of long-term debt 2,269 3,192 Total Current Liabilities 156,623 192,080 Long-Term Debt - Less Current Portion 30,376 30,435 Deferred Taxes 42,883 44,628 Other Long-Term Liabilities 92,488 97,557 Shareholders' Equity 435,821 500,017 $758,191 $864,717 ROBBINS & MYERS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED INCOME STATEMENT (Unaudited) Three Months Ended November 30, November 30, (in thousands, except per share data) 2008 2007 Sales $177,971 $173,536 Cost of sales 109,995 110,674 Gross profit 67,976 62,862 SG&A expenses 41,582 39,641 Income before interest and income taxes 26,394 23,221 Interest expense, net 53 727 Income before income taxes and minority interest 26,341 22,494 Income tax expense 8,957 7,955 Minority interest 176 601 Net income $17,208 $13,938 Net Income Per Share: Basic $0.50 $0.41 Diluted $0.50 $0.40 Weighted Average Common Shares Outstanding: Basic 34,429 34,370 Diluted 34,465 34,642 ROBBINS & MYERS, INC. AND SUBSIDIARIES CONDENSED BUSINESS SEGMENT INFORMATION (Unaudited) Three Months Ended November 30, November 30, (in thousands) 2008 2007 Sales Fluid Management $82,270 $72,355 Process Solutions 72,284 70,849 Romaco 23,417 30,332 Total $177,971 $173,536 Income Before Interest and Income Taxes (EBIT) Fluid Management $24,640 $18,448 Process Solutions 6,869 7,956 Romaco (1,443) 1,545 Corporate and Eliminations (3,672) (4,728) Total $26,394 $23,221 Depreciation and Amortization Fluid Management $1,796 $1,653 Process Solutions 1,685 1,669 Romaco 482 452 Corporate and Eliminations 130 222 Total $4,093 $3,996 Orders Fluid Management $84,427 $82,792 Process Solutions 73,681 77,416 Romaco 26,725 33,713 Total $184,833 $193,921 Backlog Fluid Management $61,665 $53,394 Process Solutions 114,258 105,481 Romaco 47,676 55,332 Total $223,599 $214,207 ROBBINS & MYERS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) Three Months Ended November 30, November 30, (in thousands) 2008 2007 Operating activities: Net income $17,208 $13,938 Depreciation and amortization 4,093 3,996 Other, net (21,599) (24,296) Cash used by operating activities (298) (6,362) Investing activities: Capital expenditures, net of nominal disposals (3,377) (4,925) Cash used by investing activities (3,377) (4,925) Financing activities: Payments of long-term debt, net (982) (761) Share repurchases (39,114) - Other, net (731) 1,894 Cash (used) provided by financing activities (40,827) 1,133 Exchange rate impact on cash (4,566) 2,055 Decrease in cash (49,068) (8,099) Cash at beginning of period 123,405 116,110 Cash at end of period $74,337 $108,011 ROBBINS & MYERS, INC. AND SUBSIDIARIES RECONCILIATION OF NET INCOME TO THE NON-GAAP MEASURES OF EBIT, EBITDA, ADJUSTED EBIT AND ADJUSTED EBITDA (Unaudited) Trailing Twelve Three Months Ended Months Ended November 30, November 30, (dollar amounts in thousands) 2008 2008 Net income $17,208 $90,672 Interest expense, net 53 1,357 Income taxes 8,957 40,101 Minority interest 176 1,707 EBIT 26,394 133,837 Minority interest (176) (1,707) Depreciation & amortization 4,093 16,346 EBITDA 30,311 148,476 Special items: Property sale gain - (1,934) Business disposition gain - (5,697) Total Special Items - (7,631) Adjusted EBIT $26,394 $126,206 Adjusted EBITDA $30,311 $140,845 Note: EBIT, EBITDA, adjusted EBIT, and adjusted EBITDA are non-GAAP measures. We use these measures to evaluate our businesses, and we allocate resources to our businesses based on EBIT. EBIT, EBITDA, adjusted EBIT, and adjusted EBITDA are not measures of performance calculated in accordance with accounting principles generally accepted in the United States and should not be considered as an alternative to net income as a measure of operating results. None of these are measures of cash available for use by management.
