Buckeye Announces January-March Results.MEMPHIS Memphis, city, ancient Egypt Memphis (mĕm`fĭs), ancient city of Egypt, capital of the Old Kingdom (c.3100–c.2258 B.C.), at the apex of the Nile delta and 12 mi (18 km) from Cairo. , Tenn. -- Buckeye buckeye: see horse chestnut. buckeye Any of about 13 trees and shrubs of the genus Aesculus (family Hippocastanaceae), native to North America, southeastern Europe, and eastern Asia. Technologies Inc. (NYSE NYSE See: New York Stock Exchange :BKI BKI Babbar Khalsa International BKI Kota Kinabalu, Sabah, Malaysia - Kota Kinabalu (Airport Code) BKI Bible Knowledge Institute BKI Brasil Kaffe Import (Danish Coffee Importer) ) today announced that it incurred a net loss of $0.8 million after tax (2 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. ) in the quarter ended March 31, 2006. The Company's results include $1.1 million after tax (3 cents per share) in restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. expenses associated with the closure of the Glueckstadt, Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). cotton linter lint·er n. 1. The short fibers that cling to cottonseeds after the first ginning. Often used in the plural. 2. A machine that removes these short fibers from the seeds of cotton. pulp mill A pulp mill is a manufacturing facility that converts wood chips or other plant fiber source into a thick fiber board which can be shipped to a paper mill for further processing. at the end of calendar year 2005. During the same quarter of the prior year, the Company earned $4.1 million after tax (11 cents per share) which included $0.8 million after tax (2 cents per share) in restructuring costs, early extinguishment The destruction or cancellation of a right, a power, a contract, or an estate. Extinguishment is sometimes confused with merger, though there is a clear distinction between them. of debt expenses, and fees related to amending the Company's credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities . Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight in the just completed quarter were $181.4 million, slightly above the $180.9 million in the same quarter of the prior year. Buckeye Chairman, David B. Ferraro Fer`ra´ro prop. n. 1. Geraldine Anne Ferraro erson>, a United States politician. Born in 1935, she was a congresswoman from New York in the United States Congress from 1978 to 1984, and ran unsuccessfully in 1984 a candidate for Vice , commented, "The combination of startup (STARTing UP) "At startup" means when the computer is first turned on or when a program is first loaded. See Startup folder. expenses at the Company's recently upgraded cotton cellulose cellulose, chief constituent of the cell walls of plants. Chemically, it is a carbohydrate that is a high molecular weight polysaccharide. Raw cotton is composed of 91% pure cellulose; other important natural sources are flax, hemp, jute, straw, and wood. manufacturing facility in Americana Americana, term used to describe material printed in or about the Americas, or written by Americans; usually restricted to the formative period in the history of the two continents. , Brazil Brazil (brəzĭl`), Port. Brasil, officially Federative Republic of Brazil, republic (2005 est. pop. 186,113,000), 3,286,470 sq mi (8,511,965 sq km), E South America. and our inability to raise fluff pulp prices to cover extraordinarily high energy related costs resulted in our poor profit performance. On the positive side, the company was able to increase prices to offset increased costs in its high end specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. fibers and nonwovens Nonwoven textiles are those which are neither woven nor knit, for example felt. General use hyphenates the word, but industrial use spells it as one word. Non-wovens are typically not strong (unless reinforced by a backing or densified). materials and to reduce debt by about $10 million." Mr. Ferraro further stated, "With our Americana facility beginning to produce saleable sale·a·ble adj. Variant of salable. saleable or US salable Adjective fit for selling or capable of being sold saleability or US products, we are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op that the Company's financial results will improve during April-June. The reduction in startup expense and operational improvement driven by our Lean Enterprise initiative should enable us to begin to rebuild margins and accelerate the pace of debt reduction." Buckeye, a leading manufacturer and marketer of specialty fibers and nonwoven non·wo·ven adj. Made by a process not involving weaving. Used of textiles. n. Material or a fabric made by a process not involving weaving. materials, is headquartered in Memphis, Tennessee For the ancient Egyptian capital, see . Memphis is a city in the southwest corner of Tennessee, and the county seat of Shelby County. Memphis rises above the Mississippi River on the 4th Chickasaw Bluff just below the mouth of the Wolf River. , USA. The Company currently operates facilities in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , Germany, Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , and Brazil. Its products are sold worldwide to makers of consumer and industrial goods industrial goods npl → bienes mpl de producción . Certain matters discussed in this press release may constitute 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. within the meaning of the federal securities laws that involve risks and uncertainties, including but not limited to economic, competitive, governmental, and technological factors affecting the Company's operations, financing, markets, products, services and prices, and other factors. For further information on factors which could impact the Company and the statements contained herein, please refer to public filings with the Securities and Exchange Commission.
BUCKEYE TECHNOLOGIES INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
March 31 June 30
2006 2005
----------- ---------
(unaudited)
Current assets:
Cash and cash equivalents $11,146 $9,926
Accounts receivable, net 113,354 118,215
Inventories 117,209 107,895
Deferred income taxes and other 8,289 10,468
----------- ---------
Total current assets 249,998 246,504
Property, plant and equipment, net 536,464 525,931
Goodwill 143,633 139,430
Intellectual property and other, net 39,639 37,872
----------- ---------
Total assets $969,734 $949,737
=========== =========
Liabilities and stockholders' equity
Current liabilities:
Trade accounts payable $32,097 $37,226
Accrued expenses 48,599 48,401
Current portion of capital lease obligations 774 685
Current portion of long-term debt 998 1,376
----------- ---------
Total current liabilities 82,468 87,688
Long-term debt 552,959 535,539
Deferred income taxes 30,816 34,660
Capital lease obligations 785 1,382
Other liabilities 21,309 20,879
Stockholders' equity 281,397 269,589
----------- ---------
Total liabilities and stockholders' equity $969,734 $949,737
=========== =========
BUCKEYE TECHNOLOGIES INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
(In thousands, except per share data)
Three Months Ended Nine Months Ended
----------------------------- -------------------
March 31, Dec. 31, March 31, March 31, March 31,
2006 2005 2005 2006 2005
--------- --------- --------- --------- ---------
Net sales $181,407 $188,254 $180,910 $535,117 $528,855
Cost of goods sold 157,063 162,546 150,700 460,872 437,869
--------- --------- --------- --------- ---------
Gross margin 24,344 25,708 30,210 74,245 90,986
Selling, research and
administrative
expenses 12,293 11,354 11,076 35,053 31,550
Amortization of
intangibles and
other 486 477 613 1,494 1,819
Impairment of long-
lived assets 1,469 - - 1,469 12,010
Restructuring costs 333 1,141 616 3,425 2,175
--------- --------- --------- --------- ---------
Operating income 9,763 12,736 17,905 32,804 43,432
Net interest expense
and amortization of
debt costs (11,061) (10,574) (11,076) (31,819) (33,633)
Loss on early
extinguishment of
debt - - (242) (151) (242)
Gain on sale of
assets held for
sale - - 30 - 7,203
Foreign exchange and
other 148 (22) (971) (242) (737)
--------- --------- --------- --------- ---------
Income (loss) before
income taxes (1,150) 2,140 5,646 592 16,023
Income tax expense
(benefit) (355) 286 1,552 (178) 4,601
--------- --------- --------- --------- ---------
Net income (loss) $(795) $1,854 $4,094 $770 $11,422
========= ========= ========= ========= =========
Earnings (loss) per
share ($0.02) $0.05 $0.11 $0.02 $0.31
Diluted earnings
(loss) per share ($0.02) $0.05 $0.11 $0.02 $0.30
Weighted average
shares for basic
earnings per share 37,638 37,592 37,499 37,606 37,400
Adjusted weighted
average shares for
diluted earnings
per share 37,638 37,630 37,723 37,646 37,595
BUCKEYE TECHNOLOGIES INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(In thousands)
Nine Months Ended
-------------------
March 31, March 31,
2006 2005
--------- ---------
OPERATING ACTIVITIES
--------------------
Net income $770 $11,422
Adjustments to reconcile net income to
net cash provided by operating activities:
Impairment of long-lived assets 1,469 12,010
Depreciation 34,947 34,703
Amortization 2,408 2,699
Loss on early extinguishment of debt 151 242
Deferred income taxes (4,511) 5,466
Gain on sale of assets held for sale - (7,203)
Other 1,624 -
Change in operating assets and liabilities
Accounts receivable 6,545 (1,752)
Inventories (8,758) (4,786)
Other assets (4,267) (4,027)
Accounts payable and other liabilities (5,338) 9,021
--------- ---------
Net cash provided by operating activities 25,040 57,795
INVESTING ACTIVITIES
Purchases of property, plant & equipment (41,179) (23,014)
Proceeds from sale of assets 42 13,662
Other (376) (401)
--------- ---------
Net cash used in investing activities (41,513) (9,753)
FINANCING ACTIVITIES
Net borrowings under line of credit 33,486 1,200
Payments on long term debt and other (16,636) (67,344)
Payments for debt issuance costs - (5)
Net proceeds from sale of equity interests 549 2,672
--------- ---------
Net cash provided by (used in) financing activities 17,399 (63,477)
--------- ---------
Effect of foreign currency rate fluctuations
on cash 294 1,061
Increase (decrease) in cash and cash equivalents 1,220 (14,374)
--------- ---------
Cash and cash equivalents at beginning of period 9,926 27,235
--------- ---------
Cash and cash equivalents at end of period $11,146 $12,861
========= =========
BUCKEYE TECHNOLOGIES INC.
SUPPLEMENTAL FINANCIAL DATA
(unaudited)
(In thousands)
Three Months Ended Nine Months Ended
----------------------------- --------------------
SEGMENT RESULTS March 31, Dec. 31, March 31, March 31, March 31,
2006 2005 2005 2006 2005
--------- --------- --------- --------- ---------
Specialty Fibers
Net sales $127,223 $137,898 $132,344 $379,682 $380,244
Operating income(a) 7,010 11,559 15,192 28,732 49,140
Depreciation and
amortization(b) 7,439 7,406 6,931 22,119 21,015
Capital expenditures 5,999 13,262 9,566 38,591 19,768
Nonwoven Materials
Net sales $61,171 $58,460 $56,617 $176,957 $170,604
Operating income(a) 5,105 2,739 3,552 10,404 10,568
Depreciation and
amortization(b) 3,842 4,062 4,412 11,942 13,038
Capital expenditures 484 406 943 1,489 2,180
Corporate
Net sales $(6,987) $(8,104) $(8,051) $(21,522) $(21,993)
Operating loss(a) (2,352) (1,562) (839) (6,332) (16,276)
Depreciation and
amortization(b) 802 842 893 2,489 2,636
Capital expenditures 338 410 726 1,099 1,066
Total
Net sales $181,407 $188,254 $180,910 $535,117 $528,855
Operating income(a) 9,763 12,736 17,905 32,804 43,432
Depreciation and
amortization(b) 12,083 12,310 12,236 36,550 36,689
Capital expenditures 6,821 14,078 11,235 41,179 23,014
(a) Asset impairment and restructuring costs are included in operating
income for the corporate segment.
(b) Depreciation and amortization includes depreciation, depletion and
amortization of intangibles.
Three Months Ended Nine Months Ended
----------------------------- --------------------
ADJUSTED EBITDA March 31, Dec. 31, March 31, March 31, March 31,
2006 2005 2005 2006 2005
--------- --------- --------- --------- ---------
Income (loss) $(795) $1,854 $4,094 $770 $11,422
Income tax expense
(benefit) (355) 286 1,552 (178) 4,601
Net interest expense 10,691 10,204 10,684 30,703 32,456
Amortization of debt
costs 370 370 392 1,116 1,177
Early extinguishment
of debt - - 242 151 242
Depreciation,
depletion and
amortization 12,083 12,310 12,236 36,550 36,689
--------- --------- --------- --------- ---------
EBITDA 21,994 25,024 29,200 69,112 86,587
Interest income 133 167 241 543 604
Asset impairments 1,469 - - 1,469 12,010
Loss on disposal of
assets 278 145 198 524 659
Gain on sale of
assets held for
sale - - (30) - (7,203)
Restructuring
charges(c) 333 1,141 616 3,425 616
--------- --------- --------- --------- ---------
Adjusted EBITDA $24,207 $26,477 $30,225 $75,073 $93,273
========= ========= ========= ========= =========
We calculate EBITDA as earnings before cumulative effect of change
in accounting plus net interest expense, income taxes and
depreciation and amortization. Adjusted EBITDA further adjusts
EBITDA by adding back the following items: interest income,
cumulative effect of changes in accounting, asset impairment
charges, restructuring charges and other (gains) losses. You
should not consider adjusted EBITDA to be an alternative measure
of our net income, as an indicator of operating performance; or
our cash flow, as an indicator of liquidity. Adjusted EBITDA
corresponds with the definition contained in our US revolving
credit facility and it provides useful information concerning our
ability to comply with debt covenants. Although we believe
adjusted EBITDA enhances your understanding of our financial
condition, this measure, when viewed individually, is not a better
indicator of any trend as compared to other measures (e.g., net
sales, net earnings, net cash flows, etc.).
On March 31, 2006 we had borrowing capacity of $31.7 million on
the revolving credit facility. The portion of this amount that we
could borrow will depend on our financial results and ability to
comply with certain borrowing conditions under the revolving
credit facility.
(c) The definition of Adjusted EBITDA limits the add back of
restructuring charges to costs incurred from October 1, 2002
through June 30, 2004, provided that the aggregate amount does not
exceed $6.0 million. Restructuring charges of $1,559 incurred
between July 1, 2004 and December 31, 2004 are not added back to
Adjusted EBITDA. We amended our credit facility on March 15, 2005.
The amended credit facility provides for adding back restructuring
charges subsequent to December 31, 2004 not to exceed $12.0
million.
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