ENPRO INDUSTRIES, INC. |
(Exact name of Registrant, as specified in its charter) |
North Carolina | 001-31225 | 01-0573945 | ||
(State or other jurisdiction | (Commission file number) | (I.R.S. Employer | ||
of incorporation | Identification No.) |
5605 Carnegie Boulevard, Suite 500 |
Charlotte, North Carolina 28209 |
(Address of principal executive offices, including zip code) |
(704) 731-1500 |
(Registrant’s telephone number, including area code) |
Not Applicable |
(Former name or address, if changed since last report) |
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 |
CFR 240.14d-2(b)) | |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 |
CFR 240.13e-4(c)) |
(d) | Exhibit 99.1 – Press Release of EnPro Industries, Inc. dated July 31, 2017 |
ENPRO INDUSTRIES, INC. | ||
By: | /s/ Robert S. McLean | |
Robert S. McLean | ||
Chief Administrative Officer, General Counsel and Secretary |
Exhibit Number | Exhibit | |
99.1 | Press Release dated July 31, 2017 |
Investor Contact: | Chris O'Neal | EnPro Industries |
Senior Vice President, Strategy, Corporate | 5605 Carnegie Boulevard | |
Development & Investor Relations | Charlotte, North Carolina 28209-4674 | |
Phone: | 704-731-1527 | Phone: 704-731-1500 |
Email: | investor.relations@enproindustries.com | Fax: 704-731-1511 |
www.enproindustries.com |
Consolidated Financial Results1 | Quarters Ended June 30 | Six Months Ended June 30 | ||||||||||||
Excludes Garlock Sealing Technologies LLC | 2017 | 2016 | % Δ | 2017 | 2016 | % Δ | ||||||||
Net Sales | $ | 307.6 | $ | 313.2 | (1.8%) | $ | 603.4 | $ | 608.1 | (0.8%) | ||||
Segment Profit | $ | 35.6 | $ | 37.0 | (3.8%) | $ | 71.6 | $ | 55.0 | 30.2% | ||||
Segment Margin | 11.6% | 11.8% | 11.9% | 9.0% | ||||||||||
Net Income (Loss) | $ | 9.0 | $ | 3.6 | 150.0% | $ | 15.4 | $ | (43.2 | ) | nm | |||
Diluted Earnings (Loss) Per Share | $ | 0.41 | $ | 0.17 | 141.2% | $ | 0.71 | $ | (1.99 | ) | nm | |||
Adjusted Net Income2 | $ | 10.1 | $ | 13.1 | (22.9%) | $ | 19.6 | $ | 12.9 | 51.9% | ||||
Adjusted Diluted Earnings (Loss) Per Share2 | $ | 0.46 | $ | 0.60 | (23.3%) | $ | 0.90 | $ | 0.59 | 52.5% | ||||
Adjusted EBITDA2 | $ | 45.2 | $ | 47.4 | (4.6%) | $ | 87.9 | $ | 74.2 | 18.5% | ||||
Adjusted EBITDA Margin2 | 14.7% | 15.1% | 14.6% | 12.2% |
Pro Forma Financial Information3 | Quarters Ended June 30 | Six Months Ended June 30 | ||||||||||||
Includes Garlock Sealing Technologies LLC | 2017 | 2016 | % Δ | 2017 | 2016 | % Δ | ||||||||
Pro Forma Net Sales2 | $ | 347.0 | $ | 352.3 | (1.5%) | $ | 684.9 | $ | 687.0 | (0.3%) | ||||
Pro Forma Segment Profit2 | $ | 45.2 | $ | 43.0 | 5.1% | $ | 88.7 | $ | 66.2 | 34.0% | ||||
Pro Forma Segment Margin2 | 13.0% | 12.2% | 13.0% | 9.6% | ||||||||||
Pro Forma Adjusted Net Income2 | $ | 22.1 | $ | 22.3 | (0.9%) | $ | 42.1 | $ | 30.7 | 37.1% | ||||
Pro Forma Adjusted EBITDA2 | $ | 58.5 | $ | 57.4 | 1.9% | $ | 112.3 | $ | 93.4 | 20.2% | ||||
Pro Forma Adjusted EBITDA Margin2 | 16.9% | 16.3% | 16.4% | 13.6% |
• | In the second quarter, the company received the bankruptcy court’s recommendation and the district court’s approval for the joint plan of reorganization in the Asbestos Claims Resolution Process (ACRP). |
• | Subsequent to the end of the quarter, on July 31, the joint plan of reorganization was consummated and GST and related entities were reconsolidated with EnPro for financial reporting purposes. |
• | EnPro continued to invest in innovation in the second quarter. Notable second quarter developments include the start of endurance testing of the OP 2.0 engine in Power Systems and continued expansion of food & pharma product offerings in Sealing Products. |
• | Capital allocation highlights: |
◦ | EnPro acquired Qualiseal Technology, a manufacturer of mechanical seals for aerospace applications, as a bolt-on acquisition within the Sealing Products segment. |
◦ | The company purchased 85,609 shares for $5.9 million in the second quarter as part of the share repurchase program authorized in October 2015. |
◦ | The company paid a $0.22 per share dividend with a total value of $4.7 million. |
Quarters Ended June 30 | Six Months Ended June 30 | |||||||||||||
($ Millions) | 2017 | 2016 | % Δ | 2017 | 2016 | % Δ | ||||||||
Consolidated Sales | $ | 191.3 | $ | 185.1 | 3.3% | $ | 370.6 | $ | 357.3 | 3.7% | ||||
Consolidated Segment Profit | $ | 21.2 | $ | 24.6 | (13.8%) | $ | 41.5 | $ | 39.3 | 5.6% | ||||
Consolidated Segment Margin | 11.1% | 13.3% | 11.2% | 11.0% | ||||||||||
Consolidated Adjusted EBITDA1 | $ | 32.5 | $ | 34.8 | (6.6%) | $ | 61.8 | $ | 59.6 | 3.7% | ||||
Consolidated Adjusted EBITDA Margin1 | 17.0% | 18.8% | 16.7% | 16.7% | ||||||||||
Pro Forma Sales2 | $ | 229.7 | $ | 223.3 | 2.9% | $ | 449.1 | $ | 434.4 | 3.4% | ||||
Pro Forma Segment Profit2 | $ | 30.3 | $ | 30.1 | 0.7% | $ | 57.2 | $ | 49.6 | 15.3% | ||||
Pro Forma Segment Margin2 | 13.2% | 13.5% | 12.7% | 11.4% | ||||||||||
Pro Forma Adjusted EBITDA1, 2 | $ | 45.6 | $ | 44.5 | 2.5% | $ | 85.5 | $ | 78.4 | 9.1% | ||||
Pro Forma Adjusted EBITDA Margin1, 2 | 19.9% | 19.9% | 19.0% | 18.0% |
• | Consolidated sales increased in the second quarter versus the prior year due to strength in semiconductor, food & pharma, and general industrial, while industrial gas turbines, nuclear, and heavy-duty trucking experienced softness in the second quarter. Pro forma net sales were impacted by the above factors plus strengthening demand in metals & mining. Excluding the impact of acquisitions, divestitures, and foreign exchange translation, consolidated sales increased 3.7% and pro forma sales increased 3.2% compared to the second quarter of 2016. |
• | Consolidated segment profit decreased in the second quarter versus prior year as a result of a lower proportion of nuclear and heavy-duty trucking sales and slightly higher SG&A costs partially offset by growth in semiconductor sales. Pro forma segment profit was affected by the same factors plus the positive impact from higher sales to the metals & mining market. Excluding the impact of acquisitions, divestitures, foreign exchange translation, and restructuring costs, consolidated segment profit decreased 10.6% and pro forma segment profit increased 2.0%. |
• | Segment SG&A costs in the second quarter were $1.1 million higher on a consolidated basis and $0.3 million higher on a pro forma basis versus the same period of 2016. |
Quarters Ended June 30 | Six Months Ended June 30 | |||||||||||||
($ Millions) | 2017 | 2016 | % Δ | 2017 | 2016 | % Δ | ||||||||
Consolidated Sales | $ | 75.7 | $ | 74.1 | 2.2% | $ | 150.8 | $ | 147.8 | 2.0% | ||||
Consolidated Segment Profit | $ | 8.2 | $ | 5.4 | 51.9% | $ | 17.7 | $ | 7.5 | 136.0% | ||||
Consolidated Segment Margin | 10.8% | 7.3% | 11.7% | 5.1% | ||||||||||
Consolidated Adjusted EBITDA1 | $ | 13.1 | $ | 10.6 | 23.6% | $ | 27.3 | $ | 20.1 | 35.8% | ||||
Consolidated Adjusted EBITDA Margin1 | 17.3% | 14.3% | 18.1% | 13.6% | ||||||||||
Pro Forma Sales2 | $ | 75.8 | $ | 74.3 | 2.0% | $ | 151.0 | $ | 148.3 | 1.8% | ||||
Pro Forma Segment Profit2 | $ | 8.4 | $ | 5.6 | 50.0% | $ | 17.9 | $ | 7.9 | 126.6% | ||||
Pro Forma Segment Margin2 | 11.1% | 7.5% | 11.9% | 5.3% | ||||||||||
Pro Forma Adjusted EBITDA1, 2 | $ | 13.3 | $ | 10.9 | 22.0% | $ | 27.4 | $ | 20.5 | 33.7% | ||||
Pro Forma Adjusted EBITDA Margin1, 2 | 17.5% | 14.7% | 18.1% | 13.8% |
• | Sales increased in the second quarter versus the prior year due to strength in the general industrial market and slight increases in the aerospace and automotive markets. European oil & gas demand experienced some softness. Excluding the impact of foreign exchange translation and divestitures, consolidated sales increased 4.6% and pro forma sales increased 4.5% in the second quarter versus the same period in 2016. |
• | Segment profit increased in the second quarter versus prior year as a result of higher sales, improved manufacturing efficiencies, and continued positive impacts from cost-reduction efforts and restructuring activities that occurred throughout 2016. Excluding the impact of restructuring costs, divestitures and foreign exchange translation, second quarter consolidated segment profit increased 52.0% and pro forma segment profit increased 50.0% from a year ago. |
• | Segment SG&A costs in the second quarter were $2.5 million lower on a consolidated and pro forma basis versus the same period of 2016. |
Quarters Ended June 30 | Six Months Ended June 30 | |||||||||||||
($ Millions) | 2017 | 2016 | % Δ | 2017 | 2016 | % Δ | ||||||||
Consolidated Sales | $ | 41.6 | $ | 54.7 | (23.9%) | $ | 84.0 | $ | 104.7 | (19.8%) | ||||
Consolidated Segment Profit | $ | 6.2 | $ | 7.0 | (11.4%) | $ | 12.4 | $ | 8.2 | 51.2% | ||||
Consolidated Segment Margin | 14.9 | % | 12.8 | % | 14.8% | 7.8% | ||||||||
Consolidated Adjusted EBITDA1 | $ | 7.3 | $ | 8.6 | (15.1%) | $ | 14.6 | $ | 10.9 | 33.9% | ||||
Consolidated Adjusted EBITDA Margin1 | 17.5 | % | 15.7 | % | 17.4% | 10.4% | ||||||||
Pro Forma Sales2 | $ | 42.5 | $ | 55.5 | (23.4%) | $ | 86.8 | $ | 106.2 | (18.3%) | ||||
Pro Forma Segment Profit2 | $ | 6.5 | $ | 7.3 | (11.0%) | $ | 13.7 | $ | 8.7 | 57.5% | ||||
Pro Forma Segment Margin2 | 15.3 | % | 13.2 | % | 15.8% | 8.2% | ||||||||
Pro Forma Adjusted EBITDA1, 2 | $ | 7.7 | $ | 9.0 | (14.4%) | $ | 15.9 | $ | 11.5 | 38.3% | ||||
Pro Forma Adjusted EBITDA Margin1, 2 | 18.1 | % | 16.2 | % | 18.3% | 10.8% |
• | Sales decreased in the second quarter versus the same period last year due to lower engine and aftermarket parts revenue. Year-over-year comparisons were unusually challenging due to record aftermarket parts sales in the second quarter of 2016. |
• | Segment profit was lower in the second quarter compared to the same period last year due to lower engine and aftermarket parts revenue partially offset by a net $3.3 million positive accounting adjustment related to the EDF contract during the second quarter. Consolidated segment profit decreased 11.4% and pro forma segment profit decreased 11.0% in the second quarter from a year ago. |
• | Segment SG&A costs in the second quarter were $1.0 million lower on a consolidated basis and $1.1 million lower on a pro forma basis versus the same period of 2016. |
Quarters Ended | Six Months Ended | ||||||||||||
June 30, 2017 | June 30, 2016 | June 30, 2017 | June 30, 2016 | ||||||||||
Net sales | $ | 307.6 | $ | 313.2 | $ | 603.4 | $ | 608.1 | |||||
Cost of sales | 203.1 | 205.3 | 397.3 | 402.6 | |||||||||
Gross profit | 104.5 | 107.9 | 206.1 | 205.5 | |||||||||
Operating expenses: | |||||||||||||
Selling, general and administrative | 74.1 | 75.2 | 147.0 | 160.8 | |||||||||
Asbestos settlement | — | — | — | 80.0 | |||||||||
Other | 3.1 | 3.6 | 4.4 | 8.0 | |||||||||
Total operating expenses | 77.2 | 78.8 | 151.4 | 248.8 | |||||||||
Operating income (loss) | 27.3 | 29.1 | 54.7 | (43.3 | ) | ||||||||
Interest expense | (16.1 | ) | (14.1 | ) | (31.0 | ) | (27.4 | ) | |||||
Interest income | — | 0.2 | 0.1 | 0.4 | |||||||||
Other expense | — | (2.5 | ) | (3.2 | ) | (4.1 | ) | ||||||
Income (loss) before income taxes | 11.2 | 12.7 | 20.6 | (74.4 | ) | ||||||||
Income tax benefit (expense) | (2.2 | ) | (9.1 | ) | (5.2 | ) | 31.2 | ||||||
Net income (loss) | $ | 9.0 | $ | 3.6 | 15.4 | $ | (43.2 | ) | |||||
Basic earnings (loss) per share | $ | 0.42 | $ | 0.17 | $ | 0.72 | $ | (1.99 | ) | ||||
Average common shares outstanding (millions) | 21.3 | 21.7 | 21.4 | 21.7 | |||||||||
Diluted earnings (loss) per share | $ | 0.41 | $ | 0.17 | $ | 0.71 | $ | (1.99 | ) | ||||
Average common shares outstanding (millions) | 21.8 | 21.9 | 21.8 | 21.7 |
2017 | 2016 | |||||||
Operating activities | ||||||||
Net income (loss) | $ | 15.4 | $ | (43.2 | ) | |||
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||
Depreciation | 14.8 | 15.0 | ||||||
Amortization | 13.2 | 13.1 | ||||||
Asbestos settlement | — | 80.0 | ||||||
Deferred income taxes | (0.4 | ) | (37.9 | ) | ||||
Stock-based compensation | 3.5 | 3.4 | ||||||
Other non-cash adjustments | 2.9 | 2.0 | ||||||
Change in assets and liabilities, net of effects of acquisition and deconsolidation of businesses: | ||||||||
Accounts receivable, net | (20.8 | ) | (16.9 | ) | ||||
Inventories | (7.5 | ) | (0.5 | ) | ||||
Accounts payable | 6.2 | (11.7 | ) | |||||
Other current assets and liabilities | 12.0 | (1.7 | ) | |||||
Other non-current assets and liabilities | (11.3 | ) | (4.6 | ) | ||||
Net cash provided by (used in) operating activities | 28.0 | (3.0 | ) | |||||
Investing activities | ||||||||
Purchases of property, plant and equipment | (15.2 | ) | (17.3 | ) | ||||
Payments for capitalized internal-use software | (1.9 | ) | (2.0 | ) | ||||
Acquisitions, net of cash acquired | (39.7 | ) | (28.3 | ) | ||||
Deconsolidation of OldCo | (4.8 | ) | — | |||||
Other | 0.3 | 0.8 | ||||||
Net cash used in investing activities | (61.3 | ) | (46.8 | ) | ||||
Financing activities | ||||||||
Proceeds from debt | 351.6 | 214.4 | ||||||
Repayments of debt | (279.6 | ) | (110.7 | ) | ||||
Repurchase of common stock | (9.8 | ) | (17.7 | ) | ||||
Dividends paid | (9.6 | ) | (9.1 | ) | ||||
Other | (3.3 | ) | (3.1 | ) | ||||
Net cash provided by financing activities | 49.3 | 73.8 | ||||||
Effect of exchange rate changes on cash and cash equivalents | 4.6 | (8.9 | ) | |||||
Net increase in cash and cash equivalents | 20.6 | 15.1 | ||||||
Cash and cash equivalents at beginning of period | 111.5 | 103.4 | ||||||
Cash and cash equivalents at end of period | $ | 132.1 | $ | 118.5 | ||||
Supplemental disclosures of cash flow information: | ||||||||
Cash paid during the period for: | ||||||||
Interest | $ | 30.4 | $ | 29.2 | ||||
Income taxes | $ | 5.5 | $ | 15.0 |
2017 | 2016 | ||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 132.1 | $ | 111.5 | |||
Accounts receivable | 234.3 | 208.1 | |||||
Inventories | 188.6 | 175.4 | |||||
Other current assets | 34.8 | 29.9 | |||||
Total current assets | 589.8 | 524.9 | |||||
Property, plant and equipment | 219.0 | 215.4 | |||||
Goodwill | 213.2 | 201.5 | |||||
Other intangible assets | 189.5 | 176.9 | |||||
Investment in GST | 236.9 | 236.9 | |||||
Deferred income taxes and income tax receivable | 115.3 | 152.6 | |||||
Other assets | 36.4 | 38.2 | |||||
Total assets | $ | 1,600.1 | $ | 1,546.4 | |||
Current liabilities: | |||||||
Short-term borrowings from GST | $ | 33.2 | $ | 26.2 | |||
Notes payable to GST | 309.3 | 12.7 | |||||
Current maturities of long-term debt | 0.2 | 0.2 | |||||
Accounts payable | 110.0 | 102.9 | |||||
Asbestos liability - current | 60.8 | 30.0 | |||||
Accrued expenses | 130.6 | 131.0 | |||||
Total current liabilities | 644.1 | 303.0 | |||||
Long-term debt | 492.4 | 424.8 | |||||
Notes payable to GST | — | 283.2 | |||||
Asbestos liability | — | 80.0 | |||||
Other liabilities | 90.2 | 96.9 | |||||
Total liabilities | 1,226.7 | 1,187.9 | |||||
Shareholders' equity: | |||||||
Common stock | 0.2 | 0.2 | |||||
Additional paid-in capital | 340.4 | 346.5 | |||||
Retained earnings | 89.6 | 84.0 | |||||
Accumulated other comprehensive loss | (55.5 | ) | (70.9 | ) | |||
Common stock held in treasury, at cost | (1.3 | ) | (1.3 | ) | |||
Total shareholders' equity | 373.4 | 358.5 | |||||
Total liabilities and equity | $ | 1,600.1 | $ | 1,546.4 |
Sales | |||||||||||||
Quarters Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||
Sealing Products | $ | 191.3 | $ | 185.1 | $ | 370.6 | $ | 357.3 | |||||
Engineered Products | 75.7 | 74.1 | 150.8 | 147.8 | |||||||||
Power Systems | 41.6 | 54.7 | 84.0 | 104.7 | |||||||||
308.6 | 313.9 | 605.4 | 609.8 | ||||||||||
Less intersegment sales | (1.0 | ) | (0.7 | ) | (2.0 | ) | (1.7 | ) | |||||
$ | 307.6 | $ | 313.2 | $ | 603.4 | $ | 608.1 |
Segment Profit | |||||||||||||
Quarters Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||
Sealing Products | $ | 21.2 | $ | 24.6 | $ | 41.5 | $ | 39.3 | |||||
Engineered Products | 8.2 | 5.4 | 17.7 | 7.5 | |||||||||
Power Systems | 6.2 | 7.0 | 12.4 | 8.2 | |||||||||
$ | 35.6 | $ | 37.0 | $ | 71.6 | $ | 55.0 |
Segment Margin | |||||||
Quarters Ended | Six Months Ended | ||||||
June 30, | June 30, | ||||||
2017 | 2016 | 2017 | 2016 | ||||
Sealing Products | 11.1% | 13.3% | 11.2 | % | 11.0 | % | |
Engineered Products | 10.8% | 7.3% | 11.7 | % | 5.1 | % | |
Power Systems | 14.9% | 12.8% | 14.8 | % | 7.8 | % | |
11.6% | 11.8% | 11.9 | % | 9.0 | % |
Reconciliation of Segment Profit to Net Income (Loss) | |||||||||||||
Quarters Ended | Six Months Ended | ||||||||||||
June 30, | June 30, | ||||||||||||
2017 | 2016 | 2017 | 2016 | ||||||||||
Segment profit | $ | 35.6 | $ | 37.0 | $ | 71.6 | $ | 55.0 | |||||
Corporate expenses | (7.1 | ) | (6.5 | ) | (14.6 | ) | (15.5 | ) | |||||
Asbestos settlement | — | — | — | (80.0 | ) | ||||||||
Interest expense, net | (16.1 | ) | (13.9 | ) | (30.9 | ) | (27.0 | ) | |||||
Other expense, net | (1.2 | ) | (3.9 | ) | (5.5 | ) | (6.9 | ) | |||||
Income (loss) before income taxes | 11.2 | 12.7 | 20.6 | (74.4 | ) | ||||||||
Income tax benefit (expense) | (2.2 | ) | (9.1 | ) | (5.2 | ) | 31.2 | ||||||
Net income (loss) | $ | 9.0 | $ | 3.6 | $ | 15.4 | $ | (43.2 | ) |
Quarters Ended June 30, | ||||||||||||||||
2017 | 2016 | |||||||||||||||
$ | Average common shares outstanding, diluted (millions) | Per share | $ | Average common shares outstanding diluted (millions) | Per share | |||||||||||
Net income | $ | 9.0 | 21.8 | $ | 0.41 | $ | 3.6 | 21.9 | $ | 0.17 | ||||||
Income tax expense | 2.2 | 9.1 | ||||||||||||||
Income before income taxes | 11.2 | 12.7 | ||||||||||||||
Adjustments: | ||||||||||||||||
Environmental reserve adjustment | — | 2.6 | ||||||||||||||
Restructuring costs | 2.5 | 2.8 | ||||||||||||||
Acquisition expenses | 0.5 | 0.4 | ||||||||||||||
Other | 0.7 | 0.9 | ||||||||||||||
Adjusted income before income taxes | 14.9 | 19.4 | ||||||||||||||
Adjusted income tax expense | (4.8 | ) | (6.3 | ) | ||||||||||||
Adjusted net income | $ | 10.1 | 21.8 | $ | 0.46 | $ | 13.1 | 21.9 | $ | 0.60 |
Six Months Ended June 30, | ||||||||||||||||
2017 | 2016 | |||||||||||||||
$ | Average common shares outstanding, diluted (millions) | Per share | $ | Average common shares outstanding diluted (millions) | Per share | |||||||||||
Net income (loss) | $ | 15.4 | 21.8 | $ | 0.71 | $ | (43.2 | ) | 21.7 | $ | (1.99 | ) | ||||
Income tax expense (benefit) | 5.2 | (31.2 | ) | |||||||||||||
Income (loss) before income taxes | 20.6 | (74.4 | ) | |||||||||||||
Adjustments: | ||||||||||||||||
Asbestos settlement | — | 80.0 | ||||||||||||||
Restructuring costs | 3.4 | 7.1 | ||||||||||||||
Environmental reserve adjustment | 3.3 | 4.2 | ||||||||||||||
Acquisition expenses | 0.6 | 0.8 | ||||||||||||||
Other | 1.1 | 1.4 | ||||||||||||||
Adjusted income before income taxes | 29.0 | 19.1 | ||||||||||||||
Adjusted income tax expense | (9.4 | ) | (6.2 | ) | ||||||||||||
Adjusted net income | $ | 19.6 | 21.8 | $ | 0.90 | $ | 12.9 | 21.9 | $ | 0.59 |
Quarter Ended June 30, 2017 | |||||||||||||
Sealing | Engineered | Power | Total | ||||||||||
Products | Products | Systems | Segments | ||||||||||
Segment profit | $ | 21.2 | $ | 8.2 | $ | 6.2 | $ | 35.6 | |||||
Acquisition expenses* | 0.5 | 0.1 | — | 0.6 | |||||||||
Restructuring costs | 1.9 | 0.6 | — | 2.5 | |||||||||
Depreciation and amortization expense | 8.9 | 4.2 | 1.1 | 14.2 | |||||||||
Earnings before interest, income taxes, depreciation, amortization, and other selected items (adjusted segment EBITDA) | $ | 32.5 | $ | 13.1 | $ | 7.3 | $ | 52.9 | |||||
Adjusted segment EBITDA margin | 17.0 | % | 17.3 | % | 17.5 | % | 17.2 | % |
Quarter Ended June 30, 2016 | |||||||||||||
Sealing | Engineered | Power | Total | ||||||||||
Products | Products | Systems | Segments | ||||||||||
Segment profit | $ | 24.6 | $ | 5.4 | $ | 7.0 | $ | 37.0 | |||||
Acquisition expenses* | 0.4 | 0.1 | — | 0.5 | |||||||||
Restructuring costs | 1.3 | 0.6 | 0.5 | 2.4 | |||||||||
Depreciation and amortization expense | 8.5 | 4.5 | 1.1 | 14.1 | |||||||||
Adjusted segment EBITDA | $ | 34.8 | $ | 10.6 | $ | 8.6 | $ | 54.0 | |||||
Adjusted segment EBITDA margin | 18.8 | % | 14.3 | % | 15.7 | % | 17.2 | % |
Six Months Ended June 30, 2017 | |||||||||||||
Sealing | Engineered | Power | Total | ||||||||||
Products | Products | Systems | Segments | ||||||||||
Segment profit | $ | 41.5 | $ | 17.7 | $ | 12.4 | $ | 71.6 | |||||
Acquisition expenses* | 0.6 | 0.1 | — | 0.7 | |||||||||
Restructuring costs | 2.2 | 1.2 | — | 3.4 | |||||||||
Depreciation and amortization expense | 17.5 | 8.3 | 2.2 | 28.0 | |||||||||
Adjusted segment EBITDA | $ | 61.8 | $ | 27.3 | $ | 14.6 | $ | 103.7 | |||||
Adjusted segment EBITDA margin | 16.7 | % | 18.1 | % | 17.4 | % | 17.2 | % |
Six Months Ended June 30, 2016 | |||||||||||||
Sealing | Engineered | Power | Total | ||||||||||
Products | Products | Systems | Segments | ||||||||||
Segment profit | $ | 39.3 | $ | 7.5 | $ | 8.2 | $ | 55.0 | |||||
Acquisition expenses* | 0.8 | 0.1 | — | 0.9 | |||||||||
Restructuring costs | 2.7 | 3.5 | 0.5 | 6.7 | |||||||||
Depreciation and amortization expense | 16.8 | 9.0 | 2.2 | 28.0 | |||||||||
Adjusted segment EBITDA | $ | 59.6 | $ | 20.1 | $ | 10.9 | $ | 90.6 | |||||
Adjusted segment EBITDA margin | 16.7 | % | 13.6 | % | 10.4 | % | 14.9 | % |
Quarters Ended | Six Months Ended | |||||||||||
June 30, | June 30, | |||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||
Net income (loss) | $ | 9.0 | $ | 3.6 | $ | 15.4 | $ | (43.2 | ) | |||
Adjustments to arrive at earnings before interest, income | ||||||||||||
taxes, depreciation and amortization (EBITDA): | ||||||||||||
Interest expense, net | 16.1 | 13.9 | 30.9 | 27.0 | ||||||||
Income tax expense (benefit) | 2.2 | 9.1 | 5.2 | (31.2 | ) | |||||||
Depreciation and amortization expense | 14.2 | 14.2 | 28.0 | 28.1 | ||||||||
EBITDA | 41.5 | 40.8 | 79.5 | (19.3 | ) | |||||||
Adjustments to arrive at earnings before interest, income taxes, depreciation, amortization and other selected items (Consolidated Adjusted EBITDA): | ||||||||||||
Asbestos settlement | — | — | — | 80.0 | ||||||||
Restructuring costs | 2.5 | 2.8 | 3.4 | 7.1 | ||||||||
Acquisition expenses | 0.5 | 0.4 | 0.6 | 0.8 | ||||||||
Environmental reserve adjustment | — | 2.6 | 3.3 | 4.2 | ||||||||
Other | 0.7 | 0.8 | 1.1 | 1.4 | ||||||||
Consolidated adjusted EBITDA | $ | 45.2 | $ | 47.4 | $ | 87.9 | $ | 74.2 |
* | Consolidated adjusted EBITDA as presented also represents the amount defined as "EBITDA" under the indenture governing the Company's 5.875% senior notes due 2022. |
Eliminate | Effect of | Pro Forma | ||||||||||||||
GST and | Intercompany | Reconsolidation | Adjustments | |||||||||||||
EnPro | OldCo | Transactions | of GST and OldCo | Pro Forma | Reference | |||||||||||
Net sales | $ | 307.6 | $ | 54.0 | $ | (14.6 | ) | $ | — | $ | 347.0 | (1) | ||||
Cost of sales | 203.1 | 32.2 | (14.6 | ) | 0.3 | 221.0 | (1), (2) | |||||||||
Gross profit | 104.5 | 21.8 | — | (0.3 | ) | 126.0 | ||||||||||
Operating expenses: | ||||||||||||||||
Selling, general and administrative | 74.1 | 10.0 | — | 2.2 | 86.3 | (2), (3) | ||||||||||
Other | 3.1 | (23.7 | ) | — | 23.2 | 2.6 | (4) | |||||||||
Total operating expenses | 77.2 | (13.7 | ) | — | 25.4 | 88.9 | ||||||||||
Operating income | 27.3 | 35.5 | — | (25.7 | ) | 37.1 | ||||||||||
Interest expense | (16.1 | ) | — | 8.9 | (0.7 | ) | (7.9 | ) | (5) | |||||||
Interest income | — | 9.4 | (8.9 | ) | — | 0.5 | (5) | |||||||||
Other expense | — | (2.4 | ) | — | 2.4 | — | (4) | |||||||||
Income before income taxes | 11.2 | 42.5 | — | (24.0 | ) | 29.7 | ||||||||||
Income tax expense | (2.2 | ) | (15.5 | ) | — | 8.0 | (9.7 | ) | (6) | |||||||
Net income | $ | 9.0 | $ | 27.0 | $ | — | $ | (16.0 | ) | $ | 20.0 | |||||
Basic earnings per share | $ | 0.42 | N/A | N/A | N/A | $ | 0.94 | |||||||||
Average common shares outstanding (millions) | 21.3 | 21.3 | ||||||||||||||
Diluted earnings per share | $ | 0.41 | N/A | N/A | N/A | $ | 0.92 | |||||||||
Average common shares outstanding (millions) | 21.8 | 21.8 |
(1 | ) | Eliminate intercompany sales of $14.6 million. |
(2 | ) | Reflects the increase in depreciation expense of $0.3 million due to adjusting property, plant and equipment to fair value. The total fair value adjustment to property, plant and equipment was $23.3 million of which $16.0 million related to depreciable buildings and improvements and machinery and equipment that have a net estimated remaining economic life of 14.5 years. |
(3 | ) | Reflects the increase in amortization expense as a result of the estimated fair value adjustment due to the creation of the finite-lived intangible assets. The estimated useful life of the finite-lived intangible assets is 15 years. |
(4 | ) | Eliminate asbestos-related expenses which would cease upon confirmation and consummation of the Second Amended Plan. |
(5 | ) | Eliminate intercompany interest and add interest expense on incremental borrowings made in order to make payment upon confirmation and consummation of the proposed consensual plan of reorganization. We used an estimated interest rate of 3% for all periods. |
(6 | ) | For purposes of the consolidated pro forma financial information, an estimated effective tax rate of 32.5% has been used for all periods presented. |
Effect of | ||||||||||||||||
Eliminate | Reconsolidation | Pro Forma | ||||||||||||||
Consolidated | GST and | Intercompany | of GST | Adjustments | ||||||||||||
EnPro | OldCo | Transactions | and OldCo | Pro Forma | Reference | |||||||||||
Net sales | $ | 603.4 | $ | 110.6 | $ | (29.1 | ) | $ | — | $ | 684.9 | (1) | ||||
Cost of sales | 397.3 | 68.3 | (29.1 | ) | 0.6 | 437.1 | (1), (2) | |||||||||
Gross profit | 206.1 | 42.3 | — | (0.6 | ) | 247.8 | ||||||||||
Operating expenses: | ||||||||||||||||
Selling, general and administrative | 147.0 | 20.8 | — | 4.4 | 172.2 | (2), (3) | ||||||||||
Other | 4.4 | (23.5 | ) | — | 22.7 | 3.6 | (4) | |||||||||
Total operating expenses | 151.4 | (2.7 | ) | — | 27.1 | 175.8 | ||||||||||
Operating income | 54.7 | 45.0 | — | (27.7 | ) | 72.0 | ||||||||||
Interest expense | (31.0 | ) | — | 17.6 | (1.4 | ) | (14.8 | ) | (5) | |||||||
Interest income | 0.1 | 18.4 | (17.6 | ) | — | 0.9 | (5) | |||||||||
Other expense | (3.2 | ) | (4.5 | ) | — | 4.5 | (3.2 | ) | (4) | |||||||
Income before income taxes | 20.6 | 58.9 | — | (24.6 | ) | 54.9 | ||||||||||
Income tax expense | (5.2 | ) | (21.3 | ) | — | 8.7 | (17.8 | ) | (6) | |||||||
Net income | $ | 15.4 | $ | 37.6 | $ | — | $ | (15.9 | ) | $ | 37.1 | |||||
Basic earnings per share | $ | 0.72 | N/A | N/A | N/A | $ | 1.73 | |||||||||
Average common shares outstanding (millions) | 21.4 | 21.4 | ||||||||||||||
Diluted earnings per share | $ | 0.71 | N/A | N/A | N/A | $ | 1.70 | |||||||||
Average common shares outstanding (millions) | 21.8 | 21.8 |
(1 | ) | Eliminate intercompany sales of $29.1 million. |
(2 | ) | Reflects the increase in depreciation expense of $0.6 million due to adjusting property, plant and equipment to fair value. The total fair value adjustment to property, plant and equipment was $23.3 million of which $16.0 million related to depreciable buildings and improvements and machinery and equipment that have a net estimated remaining economic life of 14.5 years. |
(3 | ) | Reflects the increase in amortization expense as a result of the estimated fair value adjustment due to the creation of the finite-lived intangible assets. The estimated useful life of the finite-lived intangible assets is 15 years. |
(4 | ) | Eliminate asbestos-related expenses which would cease upon confirmation and consummation of the proposed joint plan of reorganization. |
(5 | ) | Eliminate intercompany interest and add interest expense on incremental borrowings made in order to make payment upon confirmation and consummation of the proposed consensual plan of reorganization. We used an estimated interest rate of 3% for all periods. |
(6 | ) | For purposes of the consolidated pro forma financial information, an estimated effective tax rate of 32.5% has been used for all periods presented. |
Eliminate | Effect of | Pro Forma | ||||||||||||||
Intercompany | Reconsolidation | Adjustments | ||||||||||||||
EnPro | GST | Transactions | of GST | Pro Forma | Reference | |||||||||||
Net sales | $ | 313.2 | $ | 50.6 | $ | (11.5 | ) | $ | — | $ | 352.3 | (1) | ||||
Cost of sales | 205.3 | 31.5 | (11.5 | ) | 0.3 | 225.6 | (1), (2) | |||||||||
Gross profit | 107.9 | 19.1 | — | (0.3 | ) | 126.7 | ||||||||||
Operating expenses: | ||||||||||||||||
Selling, general and administrative | 75.2 | 10.6 | — | 2.2 | 88.0 | (2), (3) | ||||||||||
Other | 3.6 | 0.5 | — | (0.9 | ) | 3.2 | (4) | |||||||||
Total operating expenses | 78.8 | 11.1 | — | 1.3 | 91.2 | |||||||||||
Operating income | 29.1 | 8.0 | — | (1.6 | ) | 35.5 | ||||||||||
Interest expense | (14.1 | ) | — | 8.3 | (0.7 | ) | (6.5 | ) | (5) | |||||||
Interest income | 0.2 | 8.5 | (8.3 | ) | — | 0.4 | (5) | |||||||||
Other expense | (2.5 | ) | (1.9 | ) | — | 1.9 | (2.5 | ) | (4) | |||||||
Income before income taxes | 12.7 | 14.6 | — | (0.4 | ) | 26.9 | ||||||||||
Income tax expense | (9.1 | ) | (4.6 | ) | — | 5.0 | (8.7 | ) | (6) | |||||||
Net income | $ | 3.6 | $ | 10.0 | $ | — | $ | 4.6 | $ | 18.2 | ||||||
Basic earnings per share | $ | 0.17 | N/A | N/A | N/A | $ | 0.84 | |||||||||
Average common shares outstanding (millions) | 21.7 | 21.7 | ||||||||||||||
Diluted earnings per share | $ | 0.17 | N/A | N/A | N/A | $ | 0.83 | |||||||||
Average common shares outstanding (millions) | 21.9 | 21.9 |
(1 | ) | Eliminate intercompany sales of $11.5 million. |
(2 | ) | Reflects the increase in depreciation expense of $0.3 million due to adjusting property, plant and equipment to fair value. The total fair value adjustment to property, plant and equipment was $23.3 million of which $16.0 million related to depreciable buildings and improvements and machinery and equipment that have a net estimated remaining economic life of 14.5 years. |
(3 | ) | Reflects the increase in amortization expense as a result of the estimated fair value adjustment due to the creation of the finite-lived intangible assets. The estimated useful life of the finite-lived intangible assets is 15 years. |
(4 | ) | Eliminate asbestos-related expenses which would cease upon confirmation and consummation of the Second Amended Plan. |
(5 | ) | Eliminate intercompany interest and add interest expense on incremental borrowings made in order to make payment upon confirmation and consummation of the proposed joint plan of reorganization. We used an estimated interest rate of 3% for all periods. |
(6 | ) | For purposes of the consolidated pro forma financial information, an estimated effective tax rate of 32.5% has been used for all periods presented. |
Eliminate | Effect of | Pro Forma | ||||||||||||||
Consolidated | Intercompany | Reconsolidation | Adjustments | |||||||||||||
EnPro | GST | Transactions | of GST | Pro Forma | Reference | |||||||||||
Net sales | $ | 608.1 | $ | 101.7 | $ | (22.8 | ) | $ | — | $ | 687.0 | (1) | ||||
Cost of sales | 402.6 | 64.0 | (22.8 | ) | 0.6 | 444.4 | (1), (2) | |||||||||
Gross profit | 205.5 | 37.7 | — | (0.6 | ) | 242.6 | ||||||||||
Operating expenses: | ||||||||||||||||
Selling, general and administrative | 160.8 | 21.3 | — | 4.4 | 186.5 | (2), (3) | ||||||||||
Other | 88.0 | 50.3 | — | (130.8 | ) | 7.5 | (4) | |||||||||
Total operating expenses | 248.8 | 71.6 | — | (126.4 | ) | 194.0 | ||||||||||
Operating income (loss) | (43.3 | ) | (33.9 | ) | — | 125.8 | 48.6 | |||||||||
Interest expense | (27.4 | ) | — | 16.6 | (1.4 | ) | (12.2 | ) | (5) | |||||||
Interest income | 0.4 | 16.9 | (16.6 | ) | — | 0.7 | (5) | |||||||||
Other expense | (4.1 | ) | (8.0 | ) | — | 8.0 | (4.1 | ) | (4) | |||||||
Income (loss) before income taxes | (74.4 | ) | (25.0 | ) | — | 132.4 | 33.0 | |||||||||
Income tax benefit (expense) | 31.2 | 9.6 | — | (51.5 | ) | (10.7 | ) | (6) | ||||||||
Net income (loss) | $ | (43.2 | ) | $ | (15.4 | ) | $ | — | $ | 80.9 | $ | 22.3 | ||||
Basic earnings (loss) per share | $ | (1.99 | ) | N/A | N/A | N/A | $ | 1.03 | ||||||||
Average common shares outstanding (millions) | 21.7 | 21.7 | ||||||||||||||
Diluted earnings (loss) per share | $ | (1.99 | ) | N/A | N/A | N/A | $ | 1.02 | ||||||||
Average common shares outstanding (millions) | 21.7 | 0.2 | 21.9 | (7) |
(1 | ) | Eliminate intercompany sales of $22.8 million. |
(2 | ) | Reflects the increase in depreciation expense of $0.6 million due to adjusting property, plant and equipment to fair value. The total fair value adjustment to property, plant and equipment was $23.3 million of which $16.0 million related to depreciable buildings and improvements and machinery and equipment that have a net estimated remaining economic life of 14.5 years. |
(3 | ) | Reflects the increase in amortization expense as a result of the estimated fair value adjustment due to the creation of the finite-lived intangible assets. The estimated useful life of the finite-lived intangible assets is 15 years. |
(4 | ) | Eliminate asbestos-related expenses which would cease upon confirmation and consummation of the proposed joint plan of reorganization. |
(5 | ) | Eliminate intercompany interest and add interest expense on incremental borrowings made in order to make payment upon confirmation and consummation of the proposed joint plan of reorganization. We used an estimated interest rate of 3% for all periods. |
(6 | ) | For purposes of the consolidated pro forma financial information, an estimated effective tax rate of 32.5% has been used for all periods presented. |
(7 | ) | Represents shares that would no longer be antidilutive since the pro forma consolidated company would have net income. |
Eliminate | Effect of | Pro Forma | |||||||||||||||||
Consolidated | GST and | Consensual | Intercompany | Reconsolidation | Adjustments | ||||||||||||||
EnPro | OldCo | Plan impact (1) | Balances | of GST and OldCo | Pro Forma | Reference | |||||||||||||
Current assets | |||||||||||||||||||
Cash and investments | $ | 132.1 | $ | 347.4 | $ | (320.7 | ) | $ | — | $ | — | $ | 158.8 | ||||||
Accounts receivable | 234.3 | 32.7 | — | (22.6 | ) | — | 244.4 | (4) | |||||||||||
Inventories | 188.6 | 18.8 | — | — | 9.6 | 217.0 | (2) | ||||||||||||
Notes receivable from EnPro | — | 342.5 | — | (342.5 | ) | — | — | (3) | |||||||||||
Asbestos insurance receivable | — | 35.8 | 32.1 | — | — | 67.9 | |||||||||||||
Other current assets | 34.8 | 19.1 | 61.0 | (16.9 | ) | — | 98.0 | (4) | |||||||||||
Total current assets | 589.8 | 796.3 | (227.6 | ) | (382.0 | ) | 9.6 | 786.1 | |||||||||||
Property, plant and equipment | 219.0 | 40.5 | — | — | 23.3 | 282.8 | (2) | ||||||||||||
Goodwill | 213.2 | 18.3 | — | — | 103.2 | 334.7 | (2) | ||||||||||||
Other intangible assets | 189.5 | 3.6 | — | — | 177.4 | 370.5 | (2) | ||||||||||||
Investment in GST | 236.9 | — | — | — | (236.9 | ) | — | (6) | |||||||||||
Asbestos insurance receivable | — | 37.1 | (32.1 | ) | — | — | 5.0 | ||||||||||||
Deferred income taxes and income taxes receivable | 115.3 | 90.5 | (61.0 | ) | (59.8 | ) | — | 85.0 | (5) | ||||||||||
Other assets | 36.4 | 3.4 | — | (0.2 | ) | — | 39.6 | (4) | |||||||||||
Total assets | $ | 1,600.1 | $ | 989.7 | $ | (320.7 | ) | $ | (442.0 | ) | $ | 76.6 | $ | 1,903.7 | |||||
Current liabilities | |||||||||||||||||||
Short-term borrowings from GST | $ | 33.2 | $ | — | $ | — | $ | (33.2 | ) | $ | — | $ | — | (3) | |||||
Notes payable to GST | 309.3 | — | — | (309.3 | ) | — | — | (3) | |||||||||||
Current maturities of long-term debt | 0.2 | — | — | — | — | 0.2 | |||||||||||||
Accounts payable | 110.0 | 21.9 | 1.6 | (22.6 | ) | — | 110.9 | (4) | |||||||||||
Asbestos liability | 60.8 | — | — | — | (60.8 | ) | — | (6) | |||||||||||
Accrued expenses | 130.6 | 11.7 | — | (16.9 | ) | — | 125.4 | (4) | |||||||||||
Total current liabilities | 644.1 | 33.6 | 1.6 | (382.0 | ) | (60.8 | ) | 236.5 | |||||||||||
Long-term debt | 492.4 | — | 96.1 | — | — | 588.5 | |||||||||||||
Asbestos liability | — | 498.4 | (418.4 | ) | — | — | 80.0 | ||||||||||||
Deferred income taxes and income taxes payable | — | 60.1 | — | (59.8 | ) | 54.5 | 54.8 | (5), (7) | |||||||||||
Other liabilities | 90.2 | 4.7 | — | (0.2 | ) | — | 94.7 | (4) | |||||||||||
Total liabilities | 1,226.7 | 596.8 | (320.7 | ) | (442.0 | ) | (6.3 | ) | 1,054.5 | ||||||||||
Shareholders' equity | 373.4 | 392.9 | — | — | 82.9 | 849.2 | |||||||||||||
Total liabilities and equity | $ | 1,600.1 | $ | 989.7 | $ | (320.7 | ) | $ | (442.0 | ) | $ | 76.6 | $ | 1,903.7 |
(1 | ) | We determined that in the initial funding of the Trust, payments of agreed-upon amounts on the effective date would be funded by cash on hand and additional borrowings of $96.1 million. Additionally, we determined that the payment to the Canadian provincial boards would be funded with cash on hand. The existing deferred tax asset on the asbestos liability was eliminated and a new deferred tax asset on the remaining trust liability payments was established. Upon payment of these liabilities, $61.0 million of the new deferred tax asset is reversed and an income tax receivable is established to reflect the tax benefits that will be realized from a carryback of the resulting tax deductions. |
(2 | ) | Upon reconsolidation, the assets and liabilities of GST will need to be recognized at fair value. Inventory is valued at net realizable value which required a $9.6 million adjustment to the carrying value. We reflected a $23.3 million fair value adjustment to property, plant and equipment. We eliminated GST's pre-existing goodwill and other identifiable intangible assets of $18.3 million and $3.6 million, respectively. We identified finite-lived intangible assets with an estimated fair value of $140.6 million. In addition, we identified $40.4 million of indefinite-lived intangible assets. The carrying value of all other assets and liabilities approximated fair value. |
(3 | ) | Eliminate intercompany notes receivable/payable. |
(4 | ) | Eliminate intercompany trade receivables/payables, intercompany interest receivable/payable and other intercompany receivables/payables. |
(5 | ) | Eliminate $59.8 million of intercompany income taxes payable. |
(6 | ) | Eliminate the investment in GST which is carried at historical cost, and release liability associated with keep well to OldCo upon reconsolidation. |
(7 | ) | The elimination of the deferred tax liability on the investment in GST and establish a deferred tax liability on the step-up in fair value of assets resulted in a net increase in long-term tax liabilities of $54.5 million. |
Quarters Ended | Six Months Ended | |||||||||||
June 30, | June 30, | |||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||
Pro forma net income | $ | 20.0 | $ | 18.2 | $ | 37.1 | $ | 22.3 | ||||
Adjustments to arrive at pro forma earnings before interest, | ||||||||||||
taxes, depreciation and amortization (pro forma EBITDA): | ||||||||||||
Interest expense, net | 7.4 | 6.1 | 13.9 | 11.5 | ||||||||
Income tax expense | 9.7 | 8.7 | 17.8 | 10.7 | ||||||||
Depreciation and amortization expense | 18.3 | 18.2 | 36.1 | 36.4 | ||||||||
Pro forma EBITDA | 55.4 | 51.2 | 104.9 | 80.9 | ||||||||
Adjustments to arrive at pro forma earnings before interest, income taxes, depreciation, amortization and other selected items (pro forma adjusted EBITDA): | ||||||||||||
Restructuring costs | 2.5 | 3.1 | 3.4 | 7.4 | ||||||||
Acquisition expenses | 0.5 | 0.4 | 0.6 | 0.8 | ||||||||
Environmental reserve adjustment | — | 2.6 | 3.3 | 4.2 | ||||||||
Other | 0.1 | 0.1 | 0.1 | 0.1 | ||||||||
Pro forma adjusted EBITDA | $ | 58.5 | $ | 57.4 | $ | 112.3 | $ | 93.4 |
Quarter Ended June 30, 2017 | |||||||||||||||
Sealing | Engineered | Power | Intersegment | ||||||||||||
Products | Products | Systems | Sales | Consolidated | |||||||||||
Net sales | $ | 191.3 | $ | 75.7 | $ | 41.6 | $ | (1.0 | ) | $ | 307.6 | ||||
Adjustments: | |||||||||||||||
Sales of deconsolidated entities | 51.7 | 0.8 | 1.5 | — | 54.0 | ||||||||||
Intercompany sales | (13.3 | ) | (0.7 | ) | (0.6 | ) | — | (14.6 | ) | ||||||
Pro forma net sales | $ | 229.7 | $ | 75.8 | $ | 42.5 | $ | (1.0 | ) | $ | 347.0 |
Quarter Ended June 30, 2016 | |||||||||||||||
Sealing | Engineered | Power | Intersegment | ||||||||||||
Products | Products | Systems | Sales | Consolidated | |||||||||||
Net sales | $ | 185.1 | $ | 74.1 | $ | 54.7 | $ | (0.7 | ) | $ | 313.2 | ||||
Adjustments: | |||||||||||||||
Sales of deconsolidated entities | 48.8 | 0.7 | 1.1 | — | 50.6 | ||||||||||
Intercompany sales | (10.6 | ) | (0.5 | ) | (0.3 | ) | (0.1 | ) | (11.5 | ) | |||||
Pro forma net sales | $ | 223.3 | $ | 74.3 | $ | 55.5 | $ | (0.8 | ) | $ | 352.3 |
Six Months Ended June 30, 2017 | |||||||||||||||
Sealing | Engineered | Power | Intersegment | ||||||||||||
Products | Products | Systems | Sales | Consolidated | |||||||||||
Net sales | $ | 370.6 | $ | 150.8 | $ | 84.0 | $ | (2.0 | ) | $ | 603.4 | ||||
Adjustments: | |||||||||||||||
Sales of deconsolidated entities | 104.5 | 1.3 | 4.8 | — | $ | 110.6 | |||||||||
Intercompany sales | (26.0 | ) | (1.1 | ) | (2.0 | ) | — | $ | (29.1 | ) | |||||
Pro forma net sales | $ | 449.1 | $ | 151.0 | $ | 86.8 | $ | (2.0 | ) | $ | 684.9 |
Six Months Ended June 30, 2016 | |||||||||||||||
Sealing | Engineered | Power | Intersegment | ||||||||||||
Products | Products | Systems | Sales | Consolidated | |||||||||||
Net sales | $ | 357.3 | $ | 147.8 | $ | 104.7 | $ | (1.7 | ) | $ | 608.1 | ||||
Adjustments: | |||||||||||||||
Sales of deconsolidated entities | 98.3 | 1.4 | 2.0 | — | $ | 101.7 | |||||||||
Intercompany sales | (21.2 | ) | (0.9 | ) | (0.5 | ) | (0.2 | ) | $ | (22.8 | ) | ||||
Pro forma net sales | $ | 434.4 | $ | 148.3 | $ | 106.2 | $ | (1.9 | ) | $ | 687.0 |
Quarter Ended June 30, 2017 | |||||||||||||
Sealing | Engineered | Power | Total | ||||||||||
Products | Products | Systems | Segments | ||||||||||
Segment profit | $ | 21.2 | $ | 8.2 | $ | 6.2 | 35.6 | ||||||
Segment profit of deconsolidated entities | 11.6 | 0.2 | 0.3 | 12.1 | |||||||||
Pro forma depreciation and amortization adjustments (1) | (2.5 | ) | — | — | (2.5 | ) | |||||||
Pro forma segment profit | 30.3 | 8.4 | 6.5 | 45.2 | |||||||||
Adjustments: | |||||||||||||
Acquisition expenses* | 0.5 | 0.1 | — | 0.6 | |||||||||
Restructuring costs | 1.9 | 0.6 | — | 2.5 | |||||||||
Depreciation and amortization expense | 12.9 | 4.2 | 1.2 | 18.3 | |||||||||
Pro forma segment earnings before interest, income taxes, depreciation, amortization, and other selected items (pro forma adjusted segment EBITDA) | $ | 45.6 | $ | 13.3 | $ | 7.7 | $ | 66.6 |
Quarter Ended June 30, 2016 | |||||||||||||
Sealing | Engineered | Power | Total | ||||||||||
Products | Products | Systems | Segments | ||||||||||
Segment profit | $ | 24.6 | $ | 5.4 | $ | 7.0 | 37.0 | ||||||
Segment profit of deconsolidated entities | 8.0 | 0.2 | 0.3 | 8.5 | |||||||||
Pro forma depreciation and amortization adjustments (1) | (2.5 | ) | — | — | (2.5 | ) | |||||||
Pro forma segment profit | 30.1 | 5.6 | 7.3 | 43.0 | |||||||||
Adjustments: | |||||||||||||
Acquisition expenses* | 0.4 | 0.1 | — | 0.5 | |||||||||
Restructuring costs | 1.6 | 0.6 | 0.6 | 2.8 | |||||||||
Depreciation and amortization expense | 12.4 | 4.6 | 1.1 | 18.1 | |||||||||
Pro forma adjusted segment EBITDA | $ | 44.5 | $ | 10.9 | $ | 9.0 | $ | 64.4 |
Six Months Ended June 30, 2017 | |||||||||||||
Sealing | Engineered | Power | Total | ||||||||||
Products | Products | Systems | Segments | ||||||||||
Segment profit | $ | 41.5 | $ | 17.7 | $ | 12.4 | 71.6 | ||||||
Segment profit of deconsolidated entities | 20.7 | 0.1 | 1.3 | 22.1 | |||||||||
Pro forma depreciation and amortization adjustments (1) | (5.0 | ) | — | — | (5.0 | ) | |||||||
Pro forma segment profit | 57.2 | 17.8 | 13.7 | 88.7 | |||||||||
Adjustments: | |||||||||||||
Acquisition expenses* | 0.5 | 0.1 | — | 0.6 | |||||||||
Restructuring costs | 2.2 | 1.2 | — | 3.4 | |||||||||
Depreciation and amortization expense | 25.6 | 8.3 | 2.2 | 36.1 | |||||||||
Pro forma adjusted segment EBITDA | $ | 85.5 | $ | 27.4 | $ | 15.9 | $ | 128.8 |
Six Months Ended June 30, 2016 | |||||||||||||
Sealing | Engineered | Power | Total | ||||||||||
Products | Products | Systems | Segments | ||||||||||
Segment profit | $ | 39.3 | $ | 7.5 | $ | 8.2 | 55.0 | ||||||
Segment profit of deconsolidated entities | 15.3 | 0.4 | 0.5 | 16.2 | |||||||||
Pro forma depreciation and amortization adjustments (1) | (5.0 | ) | — | — | (5.0 | ) | |||||||
Pro forma segment profit | 49.6 | 7.9 | 8.7 | 66.2 | |||||||||
Adjustments: | |||||||||||||
Acquisition expenses* | 0.8 | 0.1 | — | 0.9 | |||||||||
Restructuring costs | 3.0 | 3.5 | 0.5 | 7.0 | |||||||||
Depreciation and amortization expense | 25.0 | 9.0 | 2.3 | 36.3 | |||||||||
Pro forma adjusted segment EBITDA | $ | 78.4 | $ | 20.5 | $ | 11.5 | $ | 110.4 |
(1 | ) | See notes (2) and (3) to the accompanying Pro Forma Condensed Consolidated Statements of Operations (Unaudited) for further information about these adjustments. |
Quarters Ended June 30, | ||||||
2017 | 2016 | |||||
Pro forma net income | $ | 20.0 | $ | 18.2 | ||
Income tax expense | 9.7 | 8.7 | ||||
Income before taxes | 29.7 | 26.9 | ||||
Adjustments: | ||||||
Environmental reserve adjustment | — | 2.6 | ||||
Restructuring costs | 2.5 | 3.1 | ||||
Acquisition expenses | 0.5 | 0.4 | ||||
Other | 0.1 | 0.1 | ||||
Adjusted income before taxes | 32.8 | 33.1 | ||||
Adjusted income tax expense | (10.7 | ) | (10.8 | ) | ||
Pro forma adjusted net income | $ | 22.1 | $ | 22.3 |
Six Months Ended June 30 | ||||||
2017 | 2016 | |||||
Pro forma net income | $ | 37.1 | $ | 22.3 | ||
Income tax expense | 17.8 | 10.7 | ||||
Income before taxes | 54.9 | 33.0 | ||||
Adjustments: | ||||||
Restructuring costs | 3.4 | 7.4 | ||||
Environmental reserve adjustment | 3.3 | 4.2 | ||||
Acquisition expenses | 0.6 | 0.8 | ||||
Other | 0.1 | 0.1 | ||||
Adjusted income before taxes | 62.3 | 45.5 | ||||
Adjusted income tax expense | (20.2 | ) | (14.8 | ) | ||
Pro forma adjusted net income | $ | 42.1 | $ | 30.7 |
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end