The "CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS" financial table in the press release dated Oct. 31, 2007 is corrected.
The corrected release reads:
Gibraltar Reports Third-Quarter Sales and Earnings
Income from Continuing Operations Before One-Time Charges is $.43 Per Share
Gibraltar Industries, Inc. (NASDAQ: ROCK) today reported sales from continuing operations in the third quarter of 2007 were $343 million, an increase of approximately eight percent compared to $318 million in the third quarter of 2006. For the first nine months of 2007, sales from continuing operations were up by approximately five percent to $1 billion, compared to $956 million in the first nine months of 2006. Net sales, excluding acquisitions, were down eight percent for the quarter and seven percent year to date, driven by the soft residential building market. Acquisitions added approximately 15 percent to net sales in the quarter.
Income from continuing operations before one-time charges was $12.8 million, or $.43 per share, in the third quarter of 2007, compared to $18.2 million, or $.61 per share, in the third quarter of 2006. In the first nine months of 2007, income from continuing operations before one-time charges was $35.8 million, or $1.19 per share, compared to $50.0 million, or $1.67 per share, in the first nine months of 2006. The decline in income from continuing operations was in line with the lower unit volume and mix changes and was partly offset by Gibraltar’s aggressive programs to streamline its operations.
Reported third-quarter income from continuing operations of $11.4 million, or $.38 per share, was negatively impacted by two nonrecurring items including a four hundred thousand ($0.4 million), $.01 per share net of tax, restructuring charge related to the consolidation of the Company’s strip steel facilities and $1.8 million, $.04 per share, in acquisition-related purchase accounting adjustments resulting from the write-up of inventories acquired in the Noll/NorWesCo and Florence transactions from their historic cost basis to fair market value. The expensing of these inventory adjustments will be completed in October and impact fourth-quarter results by $.01 per share. Reported income from continuing operations for the first nine months of 2007 is $31.4 million, or $1.04 per share.
The cost of the planned sale of Hubbell Steel assets amounted to a pre-tax charge of $13.9 million. The Company also incurred $2.9 million in pre-tax costs associated with the sale of its Solar Michigan operation. These charges have been recorded in the third quarter and have been reflected in the results from discontinued operations. The results from Hubbell’s and Solar Michigan’s business operations have been reflected in the results for discontinued operations for all periods presented.
“We generated third-quarter sales and earnings that were within our expectations, even though conditions in our two largest markets, residential housing and automotive, remained challenging during the quarter. More importantly, we continue to strategically transform Gibraltar through acquisitions, divestitures, and the streamlining of our existing businesses, all of which positions us for significantly improved results as the markets we serve improve and volumes return to more normalized levels,” said Brian J. Lipke, Gibraltar’s Chairman and Chief Executive Officer.
“During the third quarter, we completed the acquisition of Florence Corporation, a leader in the storage and postal products market. Earlier this month, we announced the sale of the assets of Hubbell Steel, a business that was not meeting our performance targets. We also made more progress with the consolidation of our facilities, with eight locations closed or consolidated thus far in 2007 and we are looking to close or consolidate additional locations. All of these actions will improve our operating characteristics, enhancing our ability to deliver stronger and more consistent results,” said Henning N. Kornbrekke, Gibraltar’s President and Chief Operating Officer.
“Our participation in the commercial building and industrial markets, our operations in Europe and Asia, and our recent acquisitions are helping to offset the slowdown in the residential building and automotive markets. Even in the new-build housing market, which is down 27 percent compared to first nine months of 2006, our core building products sales have decreased by approximately ten percent, which indicates that we are expanding our market share in an extremely difficult operating environment. We are also continuing to focus on operational excellence, cost reductions, and the further streamlining of our operations,” said Mr. Kornbrekke.
In light of the operating environment discussed above, Mr. Kornbrekke said that, barring a significant change in business conditions, Gibraltar expects its fourth-quarter earnings per share from continuing operations before any one-time items will be in the range of $.12 to $.16, compared to $.20 in the fourth quarter of 2006.
Gibraltar Industries is a leading manufacturer, processor, and distributor of products for the building, industrial, and vehicular markets. The company serves customers in a variety of industries in all 50 states and throughout the world. It has approximately 4,100 employees and operates 84 facilities in 27 states, Canada, China, England, Germany, and Poland. Gibraltar’s common stock is a component of the S&P SmallCap 600 and the Russell 2000® Index.
Information contained in this release, other than historical information, should be considered forward-looking, and may be subject to a number of risk factors, including: general economic conditions; the impact of the availability and the effects of changing raw material prices on the Company’s results of operations; energy prices and usage; the ability to pass through cost increases to customers; changing demand for the Company’s products and services; risks associated with the integration of acquisitions; and changes in interest or tax rates.
Gibraltar will review its third-quarter results and discuss its outlook for the fourth quarter during its quarterly conference call, which will be held at 9 a.m. Eastern Time on November 1. Details of the call can be found on Gibraltar’s Web site, at http://www.gibraltar1.com.
Gibraltar’s news releases, along with comprehensive information about the Company, are available on the Internet, at http://www.gibraltar1.com.
GIBRALTAR INDUSTRIES, INC. Financial Highlights (in thousands, except per share data) | ||||||
| Three Months Ended | ||||||
| September 30, 2007 | September 30, 2006 | |||||
| Net Sales | $ | 342,570 | $ | 318,442 | ||
| Income from Continuing Operations | $ | 11,367 | $ | 18,230 | ||
|
Income Per Share from Continuing
Operations –Basic | $ | .38 | $ | .61 | ||
| Weighted Average Shares Outstanding-Basic | 29,873 | 29,747 | ||||
|
Income Per Share from Continuing
Operations - Diluted | $ | .38 | $ | .61 | ||
| Weighted Average Shares Outstanding-Diluted | 30,147 | 30,040 | ||||
| Reconciliation of income per share – diluted from continuing operations to reflect special items: | ||||||
| Income from continuing operation before adjustments | $ | .43 | $ | .61 | ||
| Adjustments: | ||||||
| Restructuring charges | $ | (.01 | ) | $ | - | |
| Purchased inventory markup | $ | (.04 | ) | $ | - | |
| Income from continuing operations | $ | .38 | $ | .61 | ||
| Nine Months Ended | ||||||
| September 30, 2007 | September 30, 2006 | |||||
| Net Sales | $ | 1,003,116 | $ | 955,971 | ||
| Income from Continuing Operations | $ | 31,436 | $ | 49,999 | ||
|
Income Per Share from Continuing
Operations -Basic | $ | 1.05 | $ | 1.68 | ||
| Weighted Average Shares Outstanding-Basic | 29,847 | 29,691 | ||||
|
Income Per Share from Continuing
Operations -Diluted | $ | 1.04 | $ | 1.67 | ||
| Weighted Average Shares Outstanding-Diluted | 30,103 | 29,993 | ||||
| Reconciliation of income per share – diluted from continuing operations to reflect special items: | ||||||
| Income from continuing operation before adjustments | $ | 1.19 | $ | 1.67 | ||
| Adjustments: | ||||||
| Restructuring charges | $ | (.05 | ) | $ | - | |
| Purchased inventory markup | $ | (.07 | ) | - | ||
| Abandoned M & A transaction | $ | (.03 | ) | $ | - | |
| Income from continuing operations | $ | 1.04 | $ | 1.67 | ||
| GIBRALTAR INDUSTRIES, INC. | |||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
| (in thousands) | |||||||||
September 30, | December 31, | ||||||||
| 2007 | 2006 | ||||||||
Assets | (unaudited) | ||||||||
| Current assets: | |||||||||
| Cash and cash equivalents | $ | 32,725 | $ | 13,475 | |||||
| Accounts receivable, net | 209,481 | 163,731 | |||||||
| Inventories | 229,133 | 220,119 | |||||||
| Other current assets | 20,101 | 18,099 | |||||||
| Assets of discontinued operations | 17,311 | 40,356 | |||||||
| Total current assets | 508,751 | 455,780 | |||||||
| Property, plant and equipment, net | 260,553 | 233,249 | |||||||
| Goodwill | 501,034 | 366,763 | |||||||
| Acquired intangibles | 60,505 | 62,366 | |||||||
| Investments in partnerships | 2,616 | 2,440 | |||||||
| Other assets | 14,588 | 14,307 | |||||||
| Assets of discontinued operations | 6,330 | 17,963 | |||||||
$ | 1,354,377 | $ | 1,152,868 | ||||||
Liabilities and Shareholders' Equity | |||||||||
| Current liabilities: | |||||||||
| Accounts payable | $ | 92,949 | $ | 69,040 | |||||
| Accrued expenses | 48,932 | 50,279 | |||||||
| Current maturities of long-term debt | 2,964 | 2,336 | |||||||
| Liabilities of discontinued operations | 2,540 | 2,760 | |||||||
| Total current liabilities | 147,385 | 124,415 | |||||||
| Long-term debt | 550,670 | 398,217 | |||||||
| Deferred income taxes | 72,746 | 70,981 | |||||||
| Other non-current liabilities | 14,837 | 9,027 | |||||||
| Liabilities of discontinued operations | 15 | - | |||||||
| Shareholders' equity: | |||||||||
Preferred stock, $.01 par value; authorized: 10,000,000 shares; none outstanding | - | - | |||||||
Common stock, $.01 par value; authorized 50,000,000 shares; issued 29,949,229 and 29,883,795 shares in 2007 and 2006, respectively | 300 | 299 | |||||||
| Additional paid-in capital | 218,122 | 215,944 | |||||||
| Retained earnings | 340,749 | 332,920 | |||||||
| Accumulated other comprehensive income | 9,946 | 1,065 | |||||||
| 569,117 | 550,228 | ||||||||
Less: cost of 62,967 and 42,600 common shares held in treasury in 2007 and 2006 | (393) | - | |||||||
| Total shareholders' equity | 568,724 | 550,228 | |||||||
| $ | 1,354,377 | $ | 1,152,868 | ||||||
|
GIBRALTAR INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited) (in thousands) | ||||||||||||||||
|
Three Months Ended
September 30, |
Nine Months Ended
September 30, | |||||||||||||||
| 2007 | 2006 | 2007 | 2006 | |||||||||||||
| Net sales | $ | 342,570 | $ | 318,442 | $ | 1,003,116 | $ | 955,971 | ||||||||
| Cost of sales | 278,796 | 250,224 | 821,539 | 749,695 | ||||||||||||
| Gross profit | 63,774 | 68,218 | 181,577 | 206,276 | ||||||||||||
| Selling, general and administrative expense | 38,409 | 32,619 | 110,029 | 107,199 | ||||||||||||
| Income from operations | 25,365 | 35,599 | 71,548 | 99,077 | ||||||||||||
| Other (income) expense: | ||||||||||||||||
| Equity in partnerships’ loss (income) and other income | (356 | ) | 103 | (1,023 | ) | (445 | ) | |||||||||
| Interest expense | 8,372 | 6,056 | 23,063 | 19,272 | ||||||||||||
| Total other expense | 8,016 | 6,159 | 22,040 | 18,827 | ||||||||||||
| Income before taxes | 17,349 | 29,440 | 49,508 | 80,250 | ||||||||||||
| Provision for income taxes | 5,982 | 11,210 | 18,072 | 30,251 | ||||||||||||
| Income from continuing operations | 11,367 | 18,230 | 31,436 | 49,999 | ||||||||||||
| Discontinued operations: | ||||||||||||||||
| Income from discontinued operations before taxes | (18,590 | ) | (388 | ) | (21,733 | ) | 9,189 | |||||||||
| Income tax expense | (3,679 | ) | (154 | ) | (4,847 | ) | 3,482 | |||||||||
| Income from discontinued operations | (14,911 | ) | (234 | ) | (16,886 | ) | 5,707 | |||||||||
| Net income | $ | (3,544 | ) | $ | 17,996 | $ | 14,550 | $ | 55,706 | |||||||
| Net income per share - Basic: | ||||||||||||||||
| Income from continuing operations | .38 | .61 | 1.05 | 1.68 | ||||||||||||
| Income from discontinued operations | $ | (.50 | ) | $ | (.01 | ) | $ | (.56 | ) | $ | .19 | |||||
| Net income | $ | (.12 | ) | $ | .60 | $ | .49 | $ | 1.87 | |||||||
| Weighted average shares outstanding – Basic | 29,873 | 29,747 | 29,874 | 29,691 | ||||||||||||
| Net income per share - Diluted: | ||||||||||||||||
| Income from continuing operations | .38 | .61 | 1.04 | 1.67 | ||||||||||||
| Income from discontinued operations | (.50 | ) | (.01 | ) | (.56 | ) | .19 | |||||||||
| Net income | $ | (.12 | ) | $ | .60 | $ | .48 | $ | 1.86 | |||||||
| Weighted average shares outstanding – Diluted | 29,966 | 30,040 | 30,043 | 29,993 | ||||||||||||
GIBRALTAR INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) (in thousands) | ||||||
Nine Months Ended September 30, | ||||||
| 2007 | 2006 | |||||
| Cash flows from operating activities | ||||||
| Net income | $ | 14,550 | $ | 55,706 | ||
| Income from discontinued operations | (16,886 | ) | 5,707 | |||
| Income from continuing operations | 31,436 | 49,999 | ||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||
| Depreciation and amortization | 23,789 | 19,430 | ||||
| Provision for deferred income taxes | 797 | - | ||||
| Equity in partnerships’ loss (income) and other income | (778 | ) | 400 | |||
| Distributions from partnerships | 603 | 909 | ||||
| Stock compensation expense | 2,042 | 2,192 | ||||
| Other noncash adjustments | 163 | 782 | ||||
| Increase (decrease) in cash resulting from changes in (net of acquisitions and dispositions): | ||||||
| Accounts receivable | (22,360 | ) | (34,213 | ) | ||
| Inventories | 27,701 | (50,741 | ) | |||
| Other current assets and other assets | 3,782 | 2,375 | ||||
| Accounts payable | 13,650 | 11,254 | ||||
| Accrued expenses and other non-current liabilities | (2,962 | ) | (18,120 | ) | ||
| Net cash provided by (used in) continuing operations | 77,863 | (15,733 | ) | |||
| Net cash provided by (used in) discontinued operations | 15,923 | (8,429 | ) | |||
| Net cash provided by (used in) provided by operating activities | 93,786 | (24,162 | ) | |||
| Cash flows from investing activities | ||||||
| Acquisitions, net of cash acquired | (203,980 | ) | (13,206 | ) | ||
| Purchases of property, plant and equipment | (15,148 | ) | (16,943 | ) | ||
| Net proceeds from sale of property and equipment | 3,125 | 388 | ||||
| Net proceeds from sale of business | 1,677 | 151,511 | ||||
| Net cash (used in) provided by investing activities from continuing operations | (214,326 | ) | 121,750 | |||
Net cash used in investing activities for discontinued operations | (69 | ) | (3,433 | ) | ||
| Net cash (used in) provided by investing activities | (214,395 | ) | 118,317 | |||
| Cash flows from financing activities | ||||||
| Long-term debt reduction | (2,128 | ) | (114,292 | ) | ||
| Proceeds from long-term debt | 147,768 | 9,604 | ||||
| Payment of deferred financing costs | (1,440 | ) | (569 | ) | ||
| Payment of dividends | (4,477 | ) | (4,464 | ) | ||
| Net proceeds from issuance of common stock | 136 | 1,174 | ||||
| Tax benefit from stock options | - | 167 | ||||
Net cash provided by (used in) financing activities from continuing operations | 139,859 | (108,380 | ) | |||
| Net cash used in financing activities for discontinued operations | - | (1,500 | ) | |||
| Net cash provided by (used in) financing activities | 139,859 | (109,880 | ) | |||
| Net increase in cash and cash equivalents | 19,250 | (15,725 | ) | |||
| Cash and cash equivalents at beginning of year | 13,475 | 28,529 | ||||
| Cash and cash equivalents at end of period | $ | 32,725 | $ | 12,804 | ||
GIBRALTAR INDUSTRIES, INC. Segment Information (Unaudited) (in thousands) | ||||||||||||
| Three Months Ended September 30, | ||||||||||||
| Increase (Decrease) | ||||||||||||
| 2007 | 2006 | $ | % | |||||||||
| Net Sales | ||||||||||||
| Building products | $ | 247,175 | $ | 223,711 | $ | 23,464 | 10.5 | % | ||||
| Processed metal products | 95,395 | 94,731 | 664 | 0.7 | % | |||||||
| Total Sales | 342,570 | 318,442 | 24,128 | 7.6 | % | |||||||
| Income from Operations | ||||||||||||
| Building products | $ | 28,497 | $ | 34,511 | $ | (6,014 | ) | (17.4 | )% | |||
| Processed metal products | 5,540 | 7,187 | (1,647 | ) | (22.9 | )% | ||||||
| Corporate | (8,672 | ) | (6,099 | ) | (2,573 | ) | 42.2 | % | ||||
| Total Income from Operations | $ | 25,365 | $ | 35,599 | (10,234 | ) | (28.7 | )% | ||||
| Operating Margin | ||||||||||||
| Building products | 11.5 | % | 15.4 | % | ||||||||
| Processed metal products | 5.8 | % | 7.6 | % | ||||||||
Nine Months Ended September 30, | ||||||||||||
| Increase (Decrease) | ||||||||||||
| 2007 | 2006 | $ | % | |||||||||
| Net Sales | ||||||||||||
| Building products | $ | 710,522 | $ | 672,064 | $ | 38,458 | 5.7 | % | ||||
| Processed metal products | 292,594 | 283,907 | 8,687 | 3.1 | % | |||||||
| Total Sales | 1,003,116 | 955,971 | 47,145 | 4.9 | % | |||||||
| Income from Operations | ||||||||||||
| Building products | $ | 78,382 | $ | 106,163 | $ | (27,781 | ) | (26.2 | )% | |||
| Processed metal products | 16,089 | 20,862 | (4,773 | ) | (22.9 | )% | ||||||
| Corporate | (22,923 | ) | (27,948 | ) | 5,025 | (18.0 | )% | |||||
| Total Income from Operations | $ | 71,548 | $ | 99,077 | $ | (27,529 | ) | (27.8 | )% | |||
| Operating Margin | ||||||||||||
| Building products | 11.0 | % | 15.8 | % | ||||||||
| Processed metal products | 5.5 | % | 7.3 | % | ||||||||
Contacts:
Kenneth P. Houseknecht, 716-826-6500
Vice
President of Communications and Investor Relations
khouseknecht@gibraltar1.com
