Buckeye Reports Fourth Quarter 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 earned $8.7 million after tax ($0.23 per share) in the quarter ended June June: see month. 30, 2005. The Company's results include a $5.5 million tax benefit ($0.15 per share) relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the previously announced favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. tax ruling in connection with its investment in its discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: facility at Cork, Ireland Cork, Ireland is a term which may refer to the following places in southern Ireland, depending on context.
The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. ) 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. charges related to its previously announced plan to close 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 plant at the end of calendar 2005. During the same quarter of the prior year the Company earned $1.4 million after tax ($0.04 cents per share) which included $2.0 million ($0.05 per share) after tax in restructuring and impairment charges primarily related to the closure of its facilities in Cork, Ireland and Lumberton Lumberton, city (1990 pop. 18,601), seat of Robeson co., S N.C., on the Lumber River; founded 1787, inc. 1852. It is in an agricultural area, with tobacco, grains, soybeans, and livestock. , North Carolina North Carolina, state in the SE United States. It is bordered by the Atlantic Ocean (E), South Carolina and Georgia (S), Tennessee (W), and Virginia (N). Facts and Figures Area, 52,586 sq mi (136,198 sq km). Pop. . During fiscal year 2005, the Company earned $20.1 million after tax ($0.53 per share), including impairment, restructuring, financing costs, special asset sales, and the favorable tax ruling which netted to a profit increase of $0.3 million after tax. This compares to a loss of $38.2 million after tax ($1.03 per share) in fiscal year 2004 which included impairment, restructuring, and refinancing Refinancing An extension and/or increase in amount of existing debt. expenses of $36.6 million after tax ($0.99 per share). 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 for the April-June quarter were $183.9 million, 9.5% above the $168.0 million achieved in the same quarter of the prior year. Net sales for fiscal 2005 were $712.8 million, 8.5% above the $656.9 million achieved in 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, "Fiscal year 2005 was a year of improvement and recovery for Buckeye. We made considerable progress in restoring the Company's profitability and strengthened our balance sheet although our financial results still fell short of where we would like them to be." Mr. Ferraro went on to say, "Cash flow in fiscal 2005 was particularly encouraging. Net cash provided by operating activities totaled $78.6 million, which enabled us to reduce the debt on our balance sheet by $67.1 million (from $604.0 million to $536.9 million). We remain committed to achieving further debt reduction in fiscal 2006 and beyond." Buckeye, a leading manufacturer and marketer of 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 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 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. . 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 STATEMENTS OF OPERATIONS
(unaudited)
(In thousands, except per share data)
Three Months Ended
--------------------------------
June 30, March 31, June 30,
2005 2005 2004
---------- ---------- ----------
Net sales $ 183,927 $ 180,910 $ 168,042
Cost of goods sold 154,857 150,700 142,053
---------- ---------- ----------
Gross margin 29,070 30,210 25,989
Selling, research and administrative
expenses 11,720 11,076 10,438
Amortization of intangibles and other 461 613 552
Impairment of long-lived assets 316 - 1,075
Restructuring costs 2,404 616 2,073
---------- ---------- ----------
Operating income (loss) 14,169 17,905 11,851
Net interest expense and amortization
of debt costs (10,566) (11,076) (11,305)
Loss on early extinguishment of debt - (242) -
Gain on sale of assets held for sale - 30 -
Foreign exchange and other 88 (971) 284
---------- ---------- ----------
Income (loss) before income taxes 3,691 5,646 830
Income tax expense (benefit) (4,973) 1,552 (580)
---------- ---------- ----------
Income (loss) before cumulative
effect of change in accounting 8,664 4,094 1,410
Cumulative effect of change in
accounting (net of tax of $3,359) - - -
---------- ---------- ----------
Net income (loss) $ 8,664 $ 4,094 $ 1,410
========== ========== ==========
Earnings (loss) per share before
cumulative effect of change in
accounting
Basic earnings (loss) per share $ 0.23 $ 0.11 $ 0.04
Diluted earnings (loss) per share $ 0.23 $ 0.11 $ 0.04
Cumulative effect of change in
accounting
Basic earnings (loss) per share - - -
Diluted earnings (loss) per share - - -
Earnings (loss) per share
Basic earnings (loss) per share $ 0.23 $ 0.11 $ 0.04
Diluted earnings (loss) per share $ 0.23 $ 0.11 $ 0.04
Weighted average shares for basic
earnings per share 37,586 37,499 37,234
Adjusted weighted average shares for
diluted earnings per share 37,604 37,723 37,369
Year Ended
---------------------
June 30, June 30,
2005 2004
---------- ----------
Net sales $ 712,782 $ 656,913
Cost of goods sold 592,726 579,472
---------- ----------
Gross margin 120,056 77,441
Selling, research and administrative
expenses 43,270 42,423
Amortization of intangibles and other 2,280 2,244
Impairment of long-lived assets 12,326 45,908
Restructuring costs 4,579 5,945
---------- ----------
Operating income (loss) 57,601 (19,079)
Net interest expense and amortization
of debt costs (44,199) (46,361)
Loss on early extinguishment of debt (242) (4,940)
Gain on sale of assets held for sale 7,203 -
Foreign exchange and other (649) 273
---------- ----------
Income (loss) before income taxes 19,714 (70,107)
Income tax expense (benefit) (372) (26,197)
---------- ----------
Income (loss) before cumulative
effect of change in accounting 20,086 (43,910)
Cumulative effect of change in
accounting (net of tax of $3,359) - 5,720
---------- ----------
Net income (loss) $ 20,086 $ (38,190)
========== ==========
Earnings (loss) per share before
cumulative effect of change in
accounting
Basic earnings (loss) per share $ 0.54 ($1.18)
Diluted earnings (loss) per share $ 0.53 ($1.18)
Cumulative effect of change in
accounting
Basic earnings (loss) per share - $0.15
Diluted earnings (loss) per share - $0.15
Earnings (loss) per share
Basic earnings (loss) per share $ 0.54 ($1.03)
Diluted earnings (loss) per share $ 0.53 ($1.03)
Weighted average shares for basic
earnings per share 37,447 37,075
Adjusted weighted average shares for
diluted earnings per share 37,598 37,075
BUCKEYE TECHNOLOGIES INC.
CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)
June 30 June 30
2005 2004
----------- ----------
(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 9,926 $ 27,235
Accounts receivable, net 118,215 112,367
Inventories 107,895 107,439
Deferred income taxes and other 10,468 14,955
----------- ----------
Total current assets 246,504 261,996
Property, plant and equipment, net 525,931 537,632
Goodwill 137,964 130,172
Intellectual property and other, net 37,872 41,023
----------- ----------
Total assets $ 948,271 $ 970,823
=========== ==========
Liabilities and stockholders' equity
Current liabilities:
Trade accounts payable $ 37,226 $ 27,130
Accrued expenses 48,401 50,085
Current portion of capital lease obligations 685 632
Current portion of long-term debt 1,748 16,972
----------- ----------
Total current liabilities 88,060 94,819
Long-term debt 535,167 587,076
Deferred income taxes 32,305 30,288
Capital lease obligations 1,382 2,068
Other liabilities 20,879 27,227
Stockholders' equity 270,478 229,345
----------- ----------
Total liabilities and stockholders' equity $ 948,271 $ 970,823
=========== ==========
BUCKEYE TECHNOLOGIES INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(In thousands)
Year Ended
---------------------
June 30, June 30,
2005 2004
---------- ----------
OPERATING ACTIVITIES
--------------------
Net income (loss) $ 20,086 $ (38,190)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Cumulative effect of change in accounting - (5,720)
Impairment of long-lived assets 12,326 45,908
Depreciation 45,964 45,675
Amortization 3,477 4,227
Loss on early extinguishment of debt 242 4,940
Deferred income taxes 3,976 (27,340)
Non-cash tax benefit (5,481) -
Gain on sale of assets held for sale (7,203) -
Loss on disposal of equipment 1,935 998
Provision for bad debts 1,372 4,010
Other 402 (131)
Change in operating assets and liabilities
Accounts receivable (5,971) 11,716
Inventories (1,504) 29,838
Other assets 1,841 (2,301)
Accounts payable and other liabilities 7,159 (7,974)
---------- ----------
Net cash provided by operating activities 78,621 65,656
INVESTING ACTIVITIES
--------------------
Purchases of property, plant & equipment (45,329) (31,871)
Proceeds from sale of assets 13,648 -
Other (567) (374)
---------- ----------
Net cash used in investing activities (32,248) (32,245)
FINANCING ACTIVITIES
--------------------
Net borrowings (payments) under line of credit 400 (224,026)
Issuance of long-term debt - 350,000
Payments on long term debt and other (67,758) (178,333)
Payments for debt issuance costs (5) (9,070)
Payments related to early extinguishment of
debt - (2,115)
Proceeds from termination of swap - 4,000
Net proceeds from sale of equity interests 2,468 2,667
---------- ----------
Net cash used in financing activities (64,895) (56,877)
---------- ----------
Effect of foreign currency rate fluctuations on
cash 1,213 724
Decrease in cash and cash equivalents (17,309) (22,742)
---------- ----------
Cash and cash equivalents at beginning of period 27,235 49,977
---------- ----------
Cash and cash equivalents at end of period $ 9,926 $ 27,235
========== ==========
BUCKEYE TECHNOLOGIES INC.
SUPPLEMENTAL FINANCIAL DATA
(unaudited)
(In thousands)
Three Months Ended
--------------------------------
SEGMENT RESULTS June 30, March 31, June 30,
2005 2005 2004
---------- ---------- ----------
Specialty Fibers
Net sales $ 133,344 $ 132,344 $ 118,165
Operating income (a) 15,008 15,192 12,714
Depreciation and amortization (b) 7,144 6,931 7,024
Capital expenditures 19,588 9,566 4,457
Nonwoven Materials
Net sales $ 55,888 $ 56,617 $ 55,987
Operating income (a) 2,395 3,552 2,595
Depreciation and amortization (b) 3,866 4,412 3,633
Capital expenditures 1,510 943 884
Corporate
Net sales $ (5,305) $ (8,051) $ (6,110)
Operating income (loss) (a) (3,234) (839) (3,458)
Depreciation and amortization (b) 752 893 828
Capital expenditures 1,217 726 73
Total
Net sales $ 183,927 $ 180,910 $ 168,042
Operating income (loss) (a) 14,169 17,905 11,851
Depreciation and amortization (b) 11,762 12,236 11,485
Capital expenditures 22,315 11,235 5,414
Year Ended
---------------------
SEGMENT RESULTS June 30, June 30,
2005 2004
---------- ----------
Specialty Fibers
Net sales $ 513,588 $ 461,360
Operating income (a) 64,148 28,198
Depreciation and amortization (b) 28,159 27,662
Capital expenditures 39,356 28,909
Nonwoven Materials
Net sales $ 226,492 $ 217,641
Operating income (a) 12,963 7,580
Depreciation and amortization (b) 16,904 17,150
Capital expenditures 3,690 2,662
Corporate
Net sales $ (27,298) $ (22,088)
Operating income (loss) (a) (19,510) (54,857)
Depreciation and amortization (b) 3,388 3,321
Capital expenditures 2,283 300
Total
Net sales $ 712,782 $ 656,913
Operating income (loss) (a) 57,601 (19,079)
Depreciation and amortization (b) 48,451 48,133
Capital expenditures 45,329 31,871
(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
--------------------------------
ADJUSTED EBITDA June 30, March 31, June 30,
2005 2005 2004
---------- ---------- ----------
Income (loss) before cumulative
effect of change in accounting $ 8,664 $ 4,094 $ 1,410
Income tax expense (benefit) (4,973) 1,552 (580)
Net interest expense 10,187 10,684 10,900
Amortization of debt costs 379 392 405
Early extinguishment of debt - 242 -
Depreciation, depletion and
amortization 11,762 12,236 11,485
---------- ---------- ----------
EBITDA 26,019 29,200 23,620
Interest income 339 241 216
Asset impairments 316 - 1,075
Loss on disposal of assets (c) 341 198 304
Gain on sale of assets held for sale - (30) -
Restructuring charges (d) 2,404 616 492
Restatement due to change in
accounting - - -
---------- ---------- ----------
Adjusted EBITDA $ 29,419 $ 30,225 $ 25,707
========== ========== ==========
Year Ended
---------------------
ADJUSTED EBITDA June 30, June 30,
2005 2004
---------- ----------
Income (loss) before cumulative
effect of change in accounting $ 20,086 $ (43,910)
Income tax expense (benefit) (372) (26,197)
Net interest expense 42,643 44,401
Amortization of debt costs 1,556 1,960
Early extinguishment of debt 242 4,940
Depreciation, depletion and
amortization 48,451 48,133
---------- ----------
EBITDA 112,606 29,327
Interest income 943 923
Asset impairments 12,326 45,908
Loss on disposal of assets (c) 1,000 998
Gain on sale of assets held for sale (7,203) -
Restructuring charges (d) 3,020 4,364
Restatement due to change in
accounting - 8,525
---------- ----------
Adjusted EBITDA $ 122,692 $ 90,045
========== ==========
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. Prior year
calculations have been restated to conform with the current credit
facility definition. 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 June 30, 2005 we had borrowing capacity of $65.6 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 losses on
disposal of assets to $1.0 million per fiscal year. Since we exceeded
the $1.0 million threshold during the three months ended June 30, 2005
our add back was limited to $341 of the $1,276 of losses recorded
during the quarter.
(d) 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. Since we exceeded the $6.0 million threshold during the three
months ended June 30, 2004 our add back was limited to $492 of the
$2,073 of restructuring expense recorded during that quarter.
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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