Triumph Group Reports Fourth Quarter and Year End Fiscal 2006 Results.WAYNE Wayne, city (1990 pop. 19,899), Wayne co., SE Mich., a suburb of Detroit, on the Lower Rouge River; inc. as a village 1869, and with surrounding areas as a city 1960. It has automobile and aircraft industries and other varied manufactures. , Pa. -- Triumph triumph Ancient Roman ritual procession honouring a general who had won a major battle and killed at least 5,000 of the enemy. Senators and magistrates were followed by sacrificial animals, captured loot, and captives in chains. Group, Inc. (NYSE NYSE See: New York Stock Exchange :TGI TGI Tribunal de Grande Instance TGI Target Group Index TGI Thank God It's Friday (US restaurant chain) TGI Tracheal Gas Insufflation TGI Tumor Growth Inhibition TGI Trato Gastrointestinal (Portugese) ):
-- Net sales for fiscal year 2006 increased 10% to $760.4 million
-- Operating income in fiscal year 2006 increased 68% to $56.1
million
-- Income from continuing operations for fiscal year 2006
increased 118% to $34.5 million
-- Year end backlog reached a new record high of $887.8 million,
up 48% over prior year
Triumph Group, Inc. (NYSE:TGI) today reported that, for the fiscal year 2006, 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 totaled $760.4 million, a ten percent increase from fiscal year 2005 net sales of $688.5 million. Income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the for fiscal year 2006 increased 118 percent to $34.5 million, or $2.15 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. common share, versus $15.8 million, or $0.99 per diluted common share, for fiscal year 2005. During this fiscal year, the company generated $40.4 million of cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses . Net sales for the fourth quarter ended March 31, 2006 were $211.9 million, a sixteen percent increase from last fiscal year's fourth quarter net sales of $181.9 million. Income from continuing operations for the fourth quarter of fiscal year 2006 increased 125 percent to $11.0 million, or $0.68 per diluted common share, versus $4.9 million, or $0.30 per diluted common share, for the fourth quarter of the prior fiscal year. The quarterly results also include a tax benefit of $2.2 million associated with changes in tax reserves resulting from completed audits. During the quarter, the company generated $14.1 million of cash flow from operations. The Aerospace Systems segment reported net sales for fiscal year 2006 of $578.3 million, compared to $495.4 million for the prior fiscal year, an increase of seventeen Seventeen novel of young love. [Am. Lit.: Booth Tarkington Seventeen in Magill I, 882] See : Adolescence percent. For the fourth quarter of fiscal year 2006, the segment's net sales increased twenty-two percent to $162.2 million from $132.7 million for the prior fiscal year period. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. for fiscal year 2006 was $72.8 million, compared to $54.0 million for the prior fiscal year, an increase of thirty-five percent. For the quarter, operating income increased forty-nine percent to $21.8 million versus $14.6 million for the prior fiscal year quarter. Operating income for the fiscal year 2006 included $3.6 million of legal expenses associated with the trade secret litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. versus $2.8 million of legal expenses included in the operating income for the fiscal year 2005. The Aftermarket Aftermarket See: Secondary market. aftermarket See secondary market. Services segment reported net sales for fiscal year 2006 of $185.0 million, compared to $173.0 million for the prior fiscal year, an increase of seven percent. For the fourth quarter of fiscal year 2006, the segment's net sales increased ten percent to $50.6 million from $45.9 million for the prior fiscal year period. The operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. for the fourth quarter was $2.2 million. For the fiscal year 2006, the segment's operating loss was also $2.2 million, which included $10.8 million of costs associated with the transition of castings and sheet metal products to new aerospace programs and startup (STARTing UP) "At startup" means when the computer is first turned on or when a program is first loaded. See Startup folder. costs associated with our new Thailand Thailand (tī`lănd, –lənd), Thai Prathet Thai [land of the free], officially Kingdom of Thailand, constitutional monarchy (2005 est. pop. 65,444,000), 198,455 sq mi (514,000 sq km), Southeast Asia. maintenance and repair facility. "We remain optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op as to the results of the Aftermarket Services segment in fiscal year 2007 despite the effect of these costs on fiscal year 2006," said Richard Ri·chard , Joseph Henri Maurice Known as "Rocket." 1921-2000. Canadian hockey player. A right wing for the Montreal Canadiens (1942-1960), he led his team to eight Stanley Cup championships and was the first player to score 50 goals in a C. Ill, Triumph's President and Chief Executive Officer. Mr. Ill continued, "Triumph had an excellent fiscal year 2006 driven by strong organic growth in revenue, operating income and earnings across our core businesses. Our record level of backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. demonstrates that our products and services are in strong demand from our global customers. As we look ahead to fiscal year 2007 and beyond, we are confident that our commitment to develop new systems, products and services and our strong financial position will provide the foundation for continued revenue and earnings growth throughout the current upswing Upswing An upward turn in a security's price after a period of falling prices. in the aerospace market." In commenting on the outlook for fiscal year 2007, Mr. Ill said, "We see continued momentum across our operations in fiscal year 2007. We project sales in the range of $875 million to $925 million and earnings per share for the fiscal year of $2.40 to $2.70." As previously announced, Triumph will hold a conference call today at 8:30 a.m. (EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT ) to discuss the fiscal year 2006 fourth quarter and year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. results. The conference call will be available live and archived on the company's website at http://www.triumphgroup.com. An audio replay will be available from May 5th until May 12th by calling (888) 266-2081 (Domestic) or (703) 925-2533 (International), passcode #889458. Triumph Group, Inc., headquartered in Wayne, Pennsylvania Wayne is an unincorporated community and a U.S. Post Office located on the Main Line, centered in Delaware County, Pennsylvania, United States. While the center of Wayne is in Radnor Township, Wayne extends into both Tredyffrin Township in Chester County and Upper Merion Township , designs, engineers, manufactures, repairs and overhauls aircraft components and accessories. The company serves a broad, worldwide spectrum of the aviation industry, including commercial and regional airlines, air cargo carriers Air Cargo Carriers is a cargo airline based in Milwaukee, Wisconsin, USA. It was established in 1986 and operates feeder cargo services for major express carriers in Canada, the Caribbean and the USA. Air Cargo Carriers, Inc. , as well as original equipment manufacturers of commercial, regional, business and military aircraft and aircraft components. More information about Triumph can be found on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the at http://www.triumphgroup.com. Statements in this release which are not historical facts are 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. under the provisions of 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, including expectations of future product and service development, the aerospace market conditions, financial performance, revenue and earnings growth and sales and earnings results for fiscal 2007. All forward-looking statements involve risks and uncertainties which could affect the company's actual results and could cause its actual results to differ materially from those expressed in any forward looking statements made by, or on behalf of, the company. Further information regarding the important factors that could cause actual results to differ from projected results can be found in Triumph's reports filed with the SEC, including our Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended March 31, 2005.
FINANCIAL DATA (UNAUDITED)
TRIUMPH GROUP, INC. AND SUBSIDIARIES
(in thousands, except per share data)
Three Months Ended Twelve Months Ended
March 31, March 31,
------------------- -------------------
CONDENSED STATEMENTS OF INCOME 2006 2005 2006 2005
--------- --------- --------- ---------
Net Sales $211,870 $181,874 $760,421 $688,485
Operating Income 15,937 8,289 56,087 33,430
Interest Expense and Other 3,074 3,369 12,519 13,025
Income Tax Expense 1,908 50 9,053 4,596
--------- --------- --------- ---------
Income from Continuing
Operations 10,955 4,870 34,515 15,809
Income (Loss) from
Discontinued Operations 0 168 0 (4,381)
--------- --------- --------- ---------
Net Income $10,955 $5,038 $34,515 $11,428
========= ========= ========= =========
Earnings Per Share - Basic:
Income from Continuing
Operations $0.69 $0.31 $2.17 $1.00
Income (Loss) from
Discontinued Operations $0.00 $0.01 $0.00 ($0.28)
--------- --------- --------- ---------
Net Income $0.69 $0.32 $2.17 $0.72
========= ========= ========= =========
Weighted average common shares
outstanding - Basic 15,952 15,898 15,920 15,877
========= ========= ========= =========
Earnings Per Share - Diluted:
Income from Continuing
Operations $0.68 $0.30 $2.15 $0.99
Income (Loss) from
Discontinued Operations $0.00 $0.01 $0.00 ($0.27)
--------- --------- --------- ---------
Net Income $0.68 $0.31 $2.15 $0.72
========= ========= ========= =========
Weighted average common shares
outstanding - Diluted 16,126 16,016 16,060 15,971
========= ========= ========= =========
FINANCIAL DATA (UNAUDITED)
TRIUMPH GROUP, INC. AND SUBSIDIARIES
(dollars in thousands, except per share data)
BALANCE SHEET
March 31, March 31,
2006 2005
--------- ---------
Assets
Cash $5,698 $4,844
Accounts Receivable, net 147,780 127,942
Inventory 235,878 217,234
Deferred Income Taxes 6,868 5,422
Prepaid Expenses and Other 4,894 3,887
--------- ---------
Current Assets 401,118 359,329
Property and Equipment, net 237,325 234,123
Goodwill 272,737 273,476
Intangible Assets, net 49,424 56,227
Other 14,183 14,560
--------- ---------
Total Assets $974,787 $937,715
========= =========
Liabilities & Stockholders' Equity
Accounts Payable $73,995 $65,211
Accrued Expenses 68,488 75,598
Income Taxes Payable 5,195 2,922
Current Portion of Long-Term Debt 8,078 1,740
--------- ---------
Current Liabilities 155,756 145,471
Long-Term Debt, less current portion 153,339 156,042
Deferred Income Taxes and Other 101,986 109,539
Stockholders' Equity:
Common Stock, $.001 par value, 50,000,000
shares authorized, 16,027,324 shares issued 16 16
Capital in excess of par value 260,124 259,448
Treasury Stock, at cost, 18,311 and 123,160
shares (455) (3,057)
Accumulated other comprehensive (loss) income (159) 306
Retained earnings 304,180 269,950
--------- ---------
Total Stockholders' Equity 563,706 526,663
--------- ---------
Total Liabilities and Stockholders' Equity $974,787 $937,715
========= =========
FINANCIAL DATA (UNAUDITED)
TRIUMPH GROUP, INC. AND SUBSIDIARIES
(dollars in thousands)
SEGMENT DATA Three Months Ended Twelve Months Ended
March 31, March 31,
------------------- -------------------
2006 2005 2006 2005
--------- --------- --------- ---------
Net Sales:
Aerospace Systems $162,194 $132,734 $578,324 $495,425
Aftermarket Services 50,643 45,904 184,978 172,958
Other 0 4,969 0 26,560
Elimination of inter-
segment sales (967) (1,733) (2,881) (6,458)
--------- --------- --------- ---------
$211,870 $181,874 $760,421 $688,485
========= ========= ========= =========
Operating Income (Loss):
Aerospace Systems $21,819 $14,604 $72,766 $54,046
Aftermarket Services (2,172) 1,494 (2,172) 7,627
Other 0 (4,200) 0 (14,989)
Corporate (3,710) (3,609) (14,507) (13,254)
--------- --------- --------- ---------
$15,937 $8,289 $56,087 $33,430
========= ========= ========= =========
Depreciation and Amortization:
Aerospace Systems $5,360 $5,452 $21,981 $19,681
Aftermarket Services 2,587 2,132 9,904 8,426
Other 0 297 0 2,276
Corporate 48 37 153 145
--------- --------- --------- ---------
$7,995 $7,918 $32,038 $30,528
========= ========= ========= =========
Capital Expenditures:
Aerospace Systems $7,665 $2,103 $16,156 $12,060
Aftermarket Services 3,752 2,468 12,248 6,018
Other 0 326 0 462
Corporate 72 6 373 62
--------- --------- --------- ---------
$11,489 $4,903 $28,777 $18,602
========= ========= ========= =========
FINANCIAL DATA (UNAUDITED)
TRIUMPH GROUP, INC. AND SUBSIDIARIES
(dollars in thousands)
Non-GAAP Financial Measure Disclosures
Earnings before Interest, Taxes, Depreciation and Amortization
("EBITDA") for the three months ended March 31, 2006 was $23.9
million with a margin of 11.3%. EBITDA for the three months ended
March 31, 2005 was $16.2 million with a margin of 8.9%. EBITDA for
the twelve months ended March 31, 2006 was $88.1 million with a
margin of 11.6%. EBITDA for the twelve months ended March 31, 2005
was $64.0 million with a margin of 9.3%.
Management believes that EBITDA provides the reader a good measure of
cash generated from the operations of the business before any
investment in working capital or fixed assets.
The following definition is provided for the non-GAAP financial
measure identified above, together with a reconciliation of such non-
GAAP financial measure to the most directly comparable financial
measure calculated and presented in accordance with GAAP.
Three Months Ended Twelve Months Ended
March 31, March 31,
------------------- -------------------
2006 2005 2006 2005
--------- --------- --------- ---------
Earnings before Interest,
Taxes, Depreciation and
Amortization (EBITDA):
Income from Continuing
Operations $10,955 $4,870 $34,515 $15,809
Add-back:
Income Tax Expense 1,908 50 9,053 4,596
Interest Expense and Other 3,074 3,369 12,519 13,025
Depreciation and
Amortization 7,995 7,918 32,038 30,528
--------- --------- --------- ---------
Earnings before Interest,
Taxes, Depreciation and
Amortization ("EBITDA") $23,932 $16,207 $88,125 $63,958
--------- --------- --------- ---------
Net Sales $211,870 $181,874 $760,421 $688,485
--------- --------- --------- ---------
EBITDA Margin 11.3% 8.9% 11.6% 9.3%
========= ========= ========= =========
FINANCIAL DATA (UNAUDITED)
TRIUMPH GROUP, INC. AND SUBSIDIARIES
(dollars in thousands)
Non-GAAP Financial
Measure Disclosures
(continued)
Earnings before Interest,
Taxes, Depreciation and
Amortization (EBITDA): Three Months Ended March 31, 2006
--------------------------------------------
Segment Data
----------------------------------
Aerospace Aftermarket Corporate/
Total Systems Services Eliminations
--------- --------- ----------- ------------
Income from Continuing
Operations $10,955
Add-back:
Income Tax Expense 1,908
Interest Expense and
Other 3,074
---------
Operating Income
(Expense) $15,937 $21,819 ($2,172) ($3,710)
Depreciation and
Amortization 7,995 5,360 2,587 48
--------- --------- ----------- ------------
Earnings (Losses) before
Interest, Taxes,
Depreciation and
Amortization ("EBITDA") $23,932 $27,179 $415 ($3,662)
========= ========= =========== ============
Net Sales $211,870 $162,194 $50,643 ($967)
========= ========= =========== ============
EBITDA Margin 11.3% 16.8% 0.8% n/a
========= ========= =========== ============
Earnings before Interest,
Taxes, Depreciation and
Amortization (EBITDA): Twelve Months Ended March 31, 2006
--------------------------------------------
Segment Data
----------------------------------
Aerospace Aftermarket Corporate/
Total Systems Services Eliminations
--------- --------- ----------- ------------
Income from Continuing
Operations $34,515
Add-back:
Income Tax Expense 9,053
Interest Expense and
Other 12,519
---------
Operating Income
(Expense) $56,087 $72,766 ($2,172) ($14,507)
Depreciation and
Amortization 32,038 21,981 9,904 153
--------- --------- ----------- ------------
Earnings (Losses) before
Interest, Taxes,
Depreciation and
Amortization ("EBITDA") $88,125 $94,747 $7,732 ($14,354)
========= ========= =========== ============
Net Sales $760,421 $578,324 $184,978 ($2,881)
========= ========= =========== ============
EBITDA Margin 11.6% 16.4% 4.2% n/a
========= ========= =========== ============
FINANCIAL DATA (UNAUDITED)
TRIUMPH GROUP, INC. AND SUBSIDIARIES
(dollars in thousands)
Non-GAAP Financial Measure Disclosures (continued)
We use "Net Debt to Capital" as a measure of financial leverage. The
following table sets forth the computation of Net Debt to Capital:
March 31, March 31,
2006 2005
--------- ---------
Calculation of Net Debt
-----------------------
Current Portion $8,078 $1,740
Long-Term Debt 153,339 156,042
--------- ---------
Total Debt 161,417 157,782
Less: Cash and Cash Equivalents 5,698 4,844
--------- ---------
Net Debt $155,719 $152,938
========= =========
Calculation of Capital
----------------------
Net Debt $155,719 $152,938
Stockholders' Equity 563,706 526,663
--------- ---------
Total Capital $719,425 $679,601
========= =========
Percent of Net Debt to Capital 21.6% 22.5%
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