EX-99.1 2 a08-3746_1ex99d1.htm EX-99.1

Exhibit 99.1

Triumph Group, Inc.

 

NEWS RELEASE

 

 

 

 

Contact:

 

 

 

 

Sheila Spagnolo

 

 

 

 

Vice President

 

 

 

 

Phone (610) 251-1000

 

 

 

 

sspagnolo@triumphgroup.com

 

 

TRIUMPH GROUP REPORTS STRONG OPERATING

RESULTS FOR THIRD QUARTER FISCAL 2008;

TOTAL FISCAL YEAR 2008 GUIDANCE

INCREASED TO UPPER END OF RANGE

 

·

 

Net sales from continuing operations for third quarter fiscal 2008 increased 16% to $275.1 million

 

 

 

·

 

Operating income from continuing operations for third quarter fiscal 2008 increased 17% to $28.7 million

 

 

 

·

 

Backlog improved 14% over prior year to $1.2 billion and increased an additional 4% from second quarter fiscal 2008

 

 

 

·

 

Income from continuing operations for third quarter fiscal 2008 increased 53% to $17.9 million, or $1.00 per diluted share, computed on 9.4% higher share count

 

 

 

·

 

Net income for third quarter fiscal 2008 increased 55% to $16.7 million, or $0.93 per diluted share, inclusive of loss of $0.07 per diluted share from discontinued operations

 

 

Wayne, PA — January 24, 2008 — Triumph Group, Inc. (NYSE: TGI) today reported that net sales from continuing operations for the third quarter of the fiscal year ending March 31, 2008 totaled $275.1 million, a sixteen percent increase from last year’s third quarter net sales of $237.8 million. Income from continuing operations for the third quarter of fiscal year 2008 increased fifty-three percent to $17.9 million, or $1.00 per diluted share, versus $11.7 million, or $0.71 per diluted share, for the third quarter of the prior year.  Net income for the third quarter of fiscal year 2008 increased fifty-five percent to $16.7 million, or $0.93 per diluted share, versus $10.8 million, or $0.66 per diluted share, for the third quarter of the prior year.  The number of shares used in computing diluted earnings per share for the third quarter of fiscal 2008 increased to 18.0 million shares.  During the quarter, the company generated $21.9 million of cash flow from operations.

 

Net sales from continuing operations for the first nine months of fiscal year 2008 were $829.9 million, a twenty-two percent increase over last year’s third quarter net sales of $677.6 million.  Income from continuing operations for the first nine months of fiscal year 2008 increased fifty-three percent to $54.4 million, or $3.07 per diluted share, compared to income from continuing operations of $35.5 million, or $2.17 per diluted share, in the prior year period.  Net income for the first nine months of fiscal year 2008 increased forty-six percent to $47.9 million, or $2.70 per

 


 

diluted share, compared to net income of $32.8 million, or $2.01 per diluted share, in the prior year period.  During the nine months ended December 31, 2007, the company generated $26.2 million of cash flow from operations.

 

The Aerospace Systems segment reported net sales for the quarter of $213.0 million compared to $187.8 million in the prior year period, a thirteen percent increase.  Operating income for the third quarter of fiscal year 2008 was $26.1 million, compared to $26.1 million for the prior year period.  Organic sales growth for the quarter was fourteen percent.  Operating income for the quarter included $3.8 million of legal expenses associated with the ongoing trade secret litigation, an increase of $3.2 million over the prior year period.

 

The Aftermarket Services segment reported net sales for the quarter of $62.7 million, compared to $50.5 million in the prior year period, a twenty-four percent increase.  Operating income for the third quarter of fiscal year 2008 was $6.5 million, compared to $3.2 million for the prior year period, a 102 percent increase.  Operating margins for the quarter improved to 10.4 percent from 6.4 percent in the prior year period.  Organic sales growth for the quarter was eight percent.

 

Richard C. Ill, Triumph’s President and Chief Executive Officer, said, “Fiscal year 2008 continues to be strong, marked by sustained growth in revenues, operating income, and earnings.  The markets we serve continue to expand and our robust backlog bolsters our confidence in the outlook for the remainder of fiscal year 2008 and beyond.”

 

Commenting on the guidance for the year, Mr. Ill stated, “Based on our current outlook, we are now projecting full year earnings per share from continuing operations to be at the upper end of our previously announced range of $3.95 to $4.10.”

 

Under the terms of the company’s convertible debt, the increase in the stock price, in addition to driving greater dilution, triggered a provision which gave holders of the notes a put option through March 31, 2008, as described in our press release dated January 2, 2008.  Accordingly, the balance sheet classification of the notes will be short term for as long as the put option remains in effect.

 

As previously announced, Triumph Group will hold a conference call tomorrow at 8:30 a.m. (ET) to discuss the fiscal year 2008 third quarter results.  The conference call will be available live and archived on the company’s website at http://www.triumphgroup.com.  A slide presentation will be included with the audio portion of the webcast.  An audio replay will be available from January 25th until February 1st by calling (888) 266-2081 (Domestic) or (703) 925-2533 (International), passcode #1187893.

 

Triumph Group, Inc., headquartered in Wayne, Pennsylvania, designs, engineers, manufactures, repairs and overhauls aircraft components and accessories.  The company serves a broad, worldwide spectrum of the aviation industry, including original equipment manufacturers of commercial, regional, business and military aircraft and aircraft components, as well as commercial and regional airlines and air cargo carriers.

 

More information about Triumph can be found on the Internet at http://www.triumphgroup.com.

 

Statements in this release which are not historical facts are forward-looking statements under the provisions of the Private Securities Litigation Reform Act of 1995, including expectations of future aerospace market conditions, financial and operational performance, revenue and earnings growth and sales and earnings results for fiscal 2008.  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 for the year ended March 31, 2007.

 

FINANCIAL DATA (UNAUDITED) ON FOLLOWING 6 PAGES

 


 

FINANCIAL DATA  (UNAUDITED)

 

TRIUMPH GROUP, INC. AND SUBSIDIARIES

(in thousands, except per share data)

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

December 31,

 

December 31,

 

CONDENSED STATEMENTS OF INCOME

 

2007

 

2006

 

2007

 

2006

 

 

 

 

 

 

 

 

 

 

 

Net Sales

 

$

275,099

 

$

237,756

 

$

829,875

 

$

677,561

 

 

 

 

 

 

 

 

 

 

 

Operating Income

 

28,726

 

24,513

 

90,823

 

67,333

 

 

 

 

 

 

 

 

 

 

 

Interest Expense and Other

 

3,310

 

2,534

 

10,083

 

8,694

 

Charge for Early Extinguishment of Debt

 

0

 

5,088

 

0

 

5,088

 

Income Tax Expense

 

7,493

 

5,161

 

26,304

 

18,083

 

 

 

 

 

 

 

 

 

 

 

Income from Continuing Operations

 

17,923

 

11,730

 

54,436

 

35,468

 

Loss from Discontinued Operations, net of tax

 

(1,206

)

(929

)

(6,572

)

(2,623

)

 

 

 

 

 

 

 

 

 

 

Net Income

 

$

16,717

 

$

10,801

 

$

47,864

 

$

32,845

 

 

 

 

 

 

 

 

 

 

 

Earnings Per Share - Basic:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from Continuing Operations

 

$

1.08

 

$

0.72

 

$

3.30

 

$

2.19

 

Loss from Discontinued Operations

 

$

(0.07

)

$

(0.06

)

$

(0.40

)

$

(0.16

)

Net Income

 

$

1.01

 

$

0.66

 

$

2.90

 

$

2.03

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - Basic

 

16,563

 

16,262

 

16,515

 

16,168

 

 

 

 

 

 

 

 

 

 

 

Earnings Per Share - Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from Continuing Operations

 

$

1.00

 

$

0.71

 

$

3.07

 

$

2.17

 

Loss from Discontinued Operations

 

$

(0.07

)

$

(0.06

)

$

(0.37

)

$

(0.16

)

Net Income

 

$

0.93

 

$

0.66

*

$

2.70

 

$

2.01

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding - Diluted

 

18,002

 

16,459

 

17,706

 

16,353

 

 

 

 

 

 

 

 

 

 

 

Dividends declared and paid per common share

 

$

0.04

 

$

0.04

 

$

0.12

 

$

0.08

 

* Difference due to rounding.

 


 

FINANCIAL DATA (UNAUDITED)

 

TRIUMPH GROUP, INC. AND SUBSIDIARIES

(dollars in thousands, except per share data)

 

BALANCE SHEET

 

 

 

December 31,
2007

 

March 31,
2007

 

Assets

 

 

 

 

 

Cash

 

$

10,615

 

$

7,243

 

Accounts Receivable, net

 

165,233

 

168,372

 

Inventory

 

344,739

 

296,080

 

Deferred Income Taxes

 

11,794

 

11,316

 

Assets Held for Sale

 

23,875

 

28,643

 

Prepaid Expenses and Other

 

5,187

 

6,713

 

Current Assets

 

561,443

 

518,367

 

 

 

 

 

 

 

Property and Equipment, net

 

298,972

 

283,681

 

Goodwill

 

338,762

 

339,930

 

Intangible Assets, net

 

61,208

 

69,919

 

Other

 

14,155

 

17,261

 

 

 

 

 

 

 

Total Assets

 

$

1,274,540

 

$

1,229,158

 

 

 

 

 

 

 

Liabilities & Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

Accounts Payable

 

$

97,395

 

$

101,332

 

Accrued Expenses

 

64,921

 

75,582

 

Liabilities Related to Assets Held for Sale

 

3,756

 

7,545

 

Income Taxes Payable

 

196

 

1,484

 

Current Portion of Long-Term Debt

 

201,473

 

5,702

 

Current Liabilities

 

367,741

 

191,645

 

 

 

 

 

 

 

Long-Term Debt, less current portion

 

120,815

 

310,481

 

Deferred Income Taxes and Other

 

102,419

 

99,669

 

 

 

 

 

 

 

Stockholders' Equity:

 

 

 

 

 

Common Stock, $.001 par value, 50,000,000 shares authorized, 16,731,224 and 16,469,617 shares issued

 

16

 

16

 

Capital in excess of par value

 

287,439

 

278,177

 

Accumulated other comprehensive income (loss)

 

1,248

 

(120

)

Retained earnings

 

394,862

 

349,290

 

Total Stockholders' Equity

 

683,565

 

627,363

 

 

 

 

 

 

 

Total Liabilities and Stockholders' Equity

 

$

1,274,540

 

$

1,229,158

 

 


 

FINANCIAL DATA (UNAUDITED)

 

TRIUMPH GROUP, INC. AND SUBSIDIARIES

(dollars in thousands)

 

SEGMENT DATA

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

December 31,

 

December 31,

 

 

 

2007

 

2006

 

2007

 

2006

 

 

 

 

 

 

 

 

 

 

 

Net Sales:

 

 

 

 

 

 

 

 

 

Aerospace Systems

 

$

213,025

 

$

187,846

 

$

650,816

 

$

538,939

 

Aftermarket Services

 

62,728

 

50,459

 

181,095

 

140,941

 

Elimination of inter-segment sales

 

(654

)

(549

)

(2,036

)

(2,319

)

 

 

$

275,099

 

$

237,756

 

$

829,875

 

$

677,561

 

Operating Income (Loss):

 

 

 

 

 

 

 

 

 

Aerospace Systems

 

$

26,095

 

$

26,064

 

$

87,559

 

$

71,737

 

Aftermarket Services

 

6,519

 

3,229

 

17,072

 

8,434

 

Corporate

 

(3,888

)

(4,780

)

(13,808

)

(12,838

)

 

 

$

28,726

 

$

24,513

 

$

90,823

 

$

67,333

 

Depreciation and Amortization:

 

 

 

 

 

 

 

 

 

Aerospace Systems

 

$

7,423

 

$

6,509

 

$

22,034

 

$

19,158

 

Aftermarket Services

 

3,266

 

2,328

 

9,502

 

6,483

 

Corporate

 

64

 

57

 

197

 

168

 

 

 

$

10,753

 

$

8,894

 

$

31,733

 

$

25,809

 

Capital Expenditures:

 

 

 

 

 

 

 

 

 

Aerospace Systems

 

$

12,219

 

$

10,431

 

$

25,876

 

$

25,229

 

Aftermarket Services

 

4,339

 

3,344

 

11,670

 

14,247

 

Corporate

 

162

 

43

 

707

 

188

 

 

 

$

16,720

 

$

13,818

 

$

38,253

 

$

39,664

 

 


 

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 December 31, 2007 was $39.5 million with a margin of 14.4%.  EBITDA for the three months ended December 31, 2006 was $33.4 million with a margin of 14.1%.  EBITDA for the nine months ended December 31, 2007 was $122.6 million with a margin of 14.8%.  EBITDA for the nine months ended December 31, 2006 was $93.1 million with a margin of 13.7%.

 

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 inaccordance with GAAP.

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

December 31,

 

December 31,

 

 

 

2007

 

2006

 

2007

 

2006

 

Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from Continuing Operations

 

$

17,923

 

$

11,730

 

$

54,436

 

$

35,468

 

 

 

 

 

 

 

 

 

 

 

Add-back:

 

 

 

 

 

 

 

 

 

Income Tax Expense

 

7,493

 

5,161

 

26,304

 

18,083

 

Charge for Early Extinguishment of Debt

 

0

 

5,088

 

0

 

5,088

 

Interest Expense and Other

 

3,310

 

2,534

 

10,083

 

8,694

 

Depreciation and Amortization

 

10,753

 

8,894

 

31,733

 

25,809

 

 

 

 

 

 

 

 

 

 

 

Earnings before Interest, Taxes, Depreciation and Amortization (“EBITDA”)

 

$

39,479

 

$

33,407

 

$

122,556

 

$

93,142

 

 

 

 

 

 

 

 

 

 

 

 

Net Sales

 

$

275,099

 

$

237,756

 

$

829,875

 

$

677,561

 

 

 

 

 

 

 

 

 

 

 

EBITDA Margin

 

14.4

%

14.1

%

14.8

%

13.7

%

 


 

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 December 31, 2007

 

 

 

 

 

Segment Data

 

 

 

Total

 

Aerospace
Systems

 

Aftermarket Services

 

Corporate / Eliminations

 

 

 

 

 

 

 

 

 

 

 

Income from Continuing Operations

 

$

17,923

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Add-back:

 

 

 

 

 

 

 

 

 

Income Tax Expense

 

7,493

 

 

 

 

 

 

 

Interest Expense and Other

 

3,310

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Expense)

 

$

28,726

 

$

26,095

 

$

6,519

 

$

(3,888

)

 

 

 

 

 

 

 

 

 

 

Depreciation and Amortization

 

10,753

 

7,423

 

3,266

 

64

 

 

 

 

 

 

 

 

 

 

 

Earnings (Losses) before Interest, Taxes,

 

 

 

 

 

 

 

 

 

Depreciation and Amortization (“EBITDA”)

 

$

39,479

 

$

33,518

 

$

9,785

 

$

(3,824

)

 

 

 

 

 

 

 

 

 

 

Net Sales

 

$

275,099

 

$

213,025

 

$

62,728

 

$

(654

)

 

 

 

 

 

 

 

 

 

 

EBITDA Margin

 

14.4

%

15.7

%

15.6

%

n/a

 

 

Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA):

 

 

 

Nine Months Ended December 31, 2007

 

 

 

 

 

Segment Data

 

 

 

Total

 

Aerospace
Systems

 

Aftermarket
Services

 

Corporate / Eliminations

 

 

 

 

 

 

 

 

 

 

 

Income from Continuing Operations

 

$

54,436

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Add-back:

 

 

 

 

 

 

 

 

 

Income Tax Expense

 

26,304

 

 

 

 

 

 

 

Interest Expense and Other

 

10,083

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income (Expense)

 

$

90,823

 

$

87,559

 

$

17,072

 

$

(13,808

)

 

 

 

 

 

 

 

 

 

 

Depreciation and Amortization

 

31,733

 

22,034

 

9,502

 

197

 

 

 

 

 

 

 

 

 

 

 

Earnings (Losses) before Interest, Taxes,

 

 

 

 

 

 

 

 

 

Depreciation and Amortization (“EBITDA”)

 

$

122,556

 

$

109,593

 

$

26,574

 

$

(13,611

)

 

 

 

 

 

 

 

 

 

 

Net Sales

 

$

829,875

 

$

650,816

 

$

181,095

 

$

(2,036

)

 

 

 

 

 

 

 

 

 

 

EBITDA Margin

 

14.8

%

16.8

%

14.7

%

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:

 

 

 

December 31,

 

March 31,

 

 

 

2007

 

2007

 

 

 

 

 

 

 

Calculation of Net Debt

 

 

 

 

 

Current Portion

 

$

201,473

 

$

5,702

 

Long-term debt

 

120,815

 

310,481

 

Total Debt

 

322,288

 

316,183

 

Less: Cash

 

10,615

 

7,243

 

Net Debt

 

$

311,673

 

$

308,940

 

 

 

 

 

 

 

Calculation of Capital

 

 

 

 

 

Net Debt

 

$

311,673

 

$

308,940

 

Stockholders’ equity

 

683,565

 

627,363

 

Total Capital

 

$

995,238

 

$

936,303

 

 

 

 

 

 

 

Percent of Net Debt to Capital

 

31.3

%

33.0

%

 

######