Aavid Thermal Technologies, Inc. Announces Third Quarter Results.Business/Technology Editors CONCORD, N.H.--(BUSINESS WIRE)--Nov. 13, 2001 Aavid Thermal thermal /ther·mal/ (ther´m'l) pertaining to or characterized by heat. ther·mal adj. 1. Of, relating to, using, producing, or caused by heat. 2. Technologies, Inc., a leading provider of thermal management solutions and developer of computational fluid dynamics Computational fluid dynamics The numerical approximation to the solution of mathematical models of fluid flow and heat transfer. Computational fluid dynamics is one of the tools (in addition to experimental and theoretical methods) available to solve software, today announced preliminary operating results for its third quarter ended September September: see month. 29, 2001. For the quarter, total sales were $46.5 million or 12.8% lower than the $53.3 million reported in the prior quarter, and represented a $22.4 million decrease from the $68.9 million in sales reported for the third quarter of 2000. Sales for the Company's software subsidiary, Fluent fluent /flu·ent/ (floo´int) flowing effortlessly; said of speech. , were $14.4 million, or 12.3% lower than the $16.4 million in sales reported for the second quarter of 2001, and an 11.6% increase over third quarter 2000 sales of $12.9 million. Third quarter sales for the thermal management group, Aavid Thermalloy, totaled $32.1 million or 13.0% lower than the prior quarter's sales of $36.9 million and 42.7% lower than the $56.0 million in sales reported for the third quarter of 2000. The Company's Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become (adjusted earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. and non-recurring charges) for the third quarter of 2001 was a loss of $ 2.3 million. This represents a $12.6 million decrease from the $10.3 million of Adjusted EBITDA for the third quarter of 2000 as well as a $ 6.3 million decrease from the $4.0 million reported in the second quarter of 2001. The Company has scheduled its quarterly conference call for Wednesday Wednesday: see week. , November November: see month. 14, 2001 at 10:00 a.m. Eastern. The call may be accessed by dialing 1-800-633-8956 and entering reservation A clause in a deed of real property whereby the grantor, one who transfers property, creates and retains for the grantor some right or interest in the estate granted, such as rent or an Easement ,a right of use over the land of another. number 19979999. The conference call will also be webcast and archived on the audio portion of the Company's website at http://www.aatt.com Company Background Aavid Thermal Technologies, Inc. is a leading provider of thermal management solutions for dissipating potentially damaging heat from digital and industrial electronics, and computational fluid dynamics (CFD CFD - Computational Fluid Dynamics ) software, which permits computer modeling and flow analysis of products and processes that would otherwise require time-consuming time-con·sum·ing adj. Taking up much time. time-consuming Adjective taking up a great deal of time Adj. 1. and expensive physical models and the facilities to test them. Aavid serves a highly diversified diversified (di·verˑ·s range of markets, principally in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). and the Far East.
Additional information on Aavid Thermal Technologies is available on the World Wide Web at http://www.aatt.com. "Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " Statement Under the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 Adjusted EBITDA is included because the Company understands that such information is considered to be an additional basis on which to evaluate our ability to pay interest, repay debt and make capital expenditures. Adjusted EBITDA is not intended to represent and should not be considered more meaningful than, or as an alternative to, measures of performance, profitability or liquidity determined in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting . The matters discussed in this release contain forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. (as such term is defined in the Private Securities Litigation Reform Act of 1995) and information relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company that is based on the beliefs of the management of the Company, as well as assumptions made by and information currently available to the management of the Company. The words "estimate," "project," "believe," "anticipate," "intend," "expect," and similar expressions are intended to identify forward-looking statements. Such statements reflect the current views of the Company with respect to future events, and are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated in such forward-looking statements. The Company does not undertake any obligation to publicly release any revisions ReVisions is a 2004 anthology of alternate history short-stories. It is edited by Julie E. Czerneda and Isaac Szpindel. Contents Title Author The Resonance of Light James Alan Gardner Out of China Julie E. to these forward-looking statements to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" or to reflect the occurrence of unanticipated events.
Aavid Thermal Technologies, Inc.
Summary Financial Statements
Quarter and Nine Months Ended September 29, 2001
Consolidated Statements of Operations (Unaudited)
Nine Nine
Quarter Quarter Months Months
Ending Ending Ended Ended
Sept 29, Sept 30, Sept 29, Sept 30,
2001 2000 2001 2000
(Company) (Company) (Company) (Predecessor)
(in thousands) (Pro forma)(1)
Aavid Thermalloy $32,083 $56,018 $112,895 $183,076
Fluent 14,390 12,890 48,507 42,252
Combined net sales 46,473 68,908 161,402 225,328
Cost of goods sold 32,676 43,106 105,959 149,450
Gross profit 13,797 25,802 55,443 75,878
S,G&A expenses 15,333 16,999 47,213 52,894
Write-off of
in-process R&D -- -- -- 15,000
Amortization of
intangibles 8,564 7,413 25,685 20,180
Restructuring charge (2) 1,640 -- 14,505 --
Research and development 3,454 2,660 9,982 7,539
Operating income (loss) (15,194) (1,270) (41,942) (19,735)
Interest (expense)
income, net (5,157) (6,463) (18,329) (17,582)
Other (expense) income (213) 348 (283) 306
Income before taxes (20,564) (7,385) (60,554) (37,011)
Income tax expense (699) (2,173) (3,228) (5,871)
Minority interest
income (expense) (35) (78) 3,079 (114)
Gain on extinguishment
of debt -- -- 4,979 --
Net income $(21,298) $(9,636) $(55,724) $(42,996)
Interest 4,897 6,429 16,167 17,169
Taxes 699 2,173 3,228 5,871
Depreciation 2,683 2,927 8,944 8,670
Amortization 9,005 7,764 28,581 21,328
Minority interest 35 78 (3,079) 114
Write-off in
process R&D -- -- -- 15,000
Gain on extinguishment
of debt -- -- (4,979) --
Restructuring charges 1,640 -- 14,505 --
Senior executive
severance accrual -- 540 -- --
Inventory and
receivables provisions -- -- -- 1,097
Non-cash inventory
charge from purchase
accounting write-up
to fair value (3) -- -- -- 4,532
Adjusted EBITDA $(2,339) $10,275 $7,643 $30,785
North America cost
savings add-back (4) -- -- 4,200 --
Amended Adjusted
EBITDA $(2,339) $10,275 $11,843 $30,785
(1) Pro forma combines the period January 1, 2000 to February 1, 2000
(operations of the Predecessor) with the period February 2, 2000
to September 30, 2000 (operations of the Company). Results are
considered pro forma as Aavid Thermal Technologies, Inc.'s
financial statements are presented using a new basis of
accounting subsequent to the Willis Stein merger. Presentation of
periods prior to the Willis Stein merger are referred to as
operations of the predecessor.
(2) One-time restructuring charges related to the closure of the
Dallas and Terrell, Texas manufacturing facilities, Loudwater,
U.K. facility and employee cost reductions in New Hampshire.
(3) Inventory write-up to fair value that was recorded as part of
purchase accounting is included as additional expense within cost
of sales for the first three months of 2000.
(4) This represents a pro forma add-back to EBITDA associated with
estimated cost savings which result from certain employee cost
reductions in New Hampshire and the cessation (on June 30, 2001)
of manufacturing operations in our Dallas, Texas facility as
allowed under our Amended Senior Credit Facility.
Consolidated Condensed Balance Sheets
Sept 29, June 30, March 31, December 31,
2001 2001 2001 2000
(in thousands) (Unaudited) (Unaudited) (Unaudited)
ASSETS
Cash $15,177 $24,272 $14,473 $23,849
Accounts receivable 35,620 38,559 43,784 49,094
Inventory 16,893 21,686 23,471 25,203
Other current assets 5,071 4,898 5,263 4,625
Current assets 72,761 89,415 86,991 102,771
Property, plant
and equipment,net 49,097 48,696 50,114 57,013
Goodwill, net 145,611 151,413 156,636 162,430
Developed technology
and assembled workforce 40,844 43,568 46,291 49,015
Other assets 7,542 8,649 10,484 15,059
Total assets $315,855 $341,741 $350,516 $386,288
LIABILITES, MINORITY INTEREST
AND STOCKHOLDERS' EQUITY
Revolving line
of credit $17,000 $ -- $ -- $ --
Term loan 41,000 4,000 10,000 10,000
Other short-term debt 368 362 744 768
Accounts payable 13,537 14,012 16,915 18,582
Accrued expenses 21,843 26,090 22,479 29,998
Restructuring charges 2,630 3,192 3,745 1,274
Other current
liabilities 16,889 17,432 17,758 17,381
Current liabilities 113,267 65,088 71,641 78,003
Revolving line of credit -- 17,000 7,700 7,700
Term loan -- 37,000 39,000 41,000
12 3/4% senior
subordinated notes 119,511 119,369 144,451 144,290
Other long term debt 277 303 173 244
Deferred taxes 9,784 9,862 9,922 9,977
Total liabilities 242,839 248,622 272,887 281,214
Commitments and
Contingencies
Minority interest
in consolidated
subsidiaries 1,527 1,492 1,744 4,915
Preferred stock -- -- -- --
Common stock -- -- -- --
Warrants 3,764 3,764 4,560 4,560
Additional paid
in capital 176,007 176,236 147,187 147,187
Cumulative translation
adjustment (2,578) (3,967) (3,321) (1,608)
Retained earnings (105,704) (84,406) (72,541) (49,980)
Total stockholder's
equity 71,489 91,627 75,885 100,159
Total liabilities,
minority interest
and stockholder's
equity $315,855 $341,741 $350,516 $386,288
Consolidated Condensed Statements of Cash Flows (Unaudited)
Quarter Ending Nine Months Ending
Sept 29, Sept 30, Sept 29, Sept 30,
2001 2000 2001 2000
(Pro Forma)(1)
(in thousands) (Company) (Company) (Company) (Predecessor)
Net Income $(21,298) $(9,636) $(55,724) $(42,996)
Depreciation and
amortization 11,546 10,148 37,072 29,129
In-process R&D -- -- -- 15,000
Inventory fair
value adjustment -- -- -- 4,532
Interest paid on
Sr. Credit Facility (988) (3,463) (2,853) (5,518)
Interest paid on
12 3/4% senior
subordinated notes (8,701) (9,509) (18,264) (9,509)
Restructuring charge 1,640 -- 14,505
Other operating
cash flows 10,404 13,090 17,503 22,435
Total cash flows
from Operations (7,397) 630 (7,761) 13,073
Purchase of Curamik
minority interest -- -- (882) --
Purchase of property,
plant and equipment (2,403) (3,392) (6,712) (8,699)
Proceeds from sale
of property 7 1,119 133 1,119
Total cash flows
from investing
Activities (2,396) (2,273) (7,461) (7,580)
Issuance of common stock -- -- -- 349
Advances under line
of credit 34 -- 9,334 7,700
Repayments of line
of credit -- -- (396) (8,182)
Advances under other
debt obligations -- -- -- 53,936
Repayments under other
debt obligations (123) (421) (10,341) (80,025)
Payment of merger expenses -- -- -- (17,192)
Repurchase of common stock,
options and warrants -- -- -- (261,267)
Make-well contribution -- -- 34,028 --
Retirement of 12 3/4%
senior subordinated notes -- -- (26,028) --
Proceeds from 12 3/4%
senior subordinated notes -- -- -- 148,312
Proceeds from investors -- -- -- 152,000
Cash flows from financing
Activities (89) (421) 6,597 (4,369)
Foreign exchange effect 787 (237) (47) (496)
Net increase (decrease)
in cash (9,095) (2,301) (8,672) 628
Cash at beginning
of period 24,272 21,202 23,849 18,273
Cash at end of period $15,177 $18,901 $15,177 $18,901
(1) Pro forma combines the period January 1, 2000 to February 1, 2000
(operations of the Predecessor) with the period February 2, 2000
to September 30, 2000 (operations of the Company). Results are
considered pro forma as Aavid Thermal Technologies, Inc.'s
financial statements are presented using a new basis of
accounting subsequent to the Willis Stein merger. Presentation of
periods prior to the Willis Stein merger are referred to as
operations of the predecessor.
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