Delaware
|
1-06620
|
11-1893410
|
(State or Other
Jurisdiction
|
(Commission
|
(I.R.S.
Employer
|
of
Incorporation)
|
File Number)
|
Identification
Number)
|
100
Jericho Quadrangle
Jericho,
New York
|
11753
|
(Address of Principal Executive Offices) |
(Zip
Code)
|
(d)
|
Exhibits.
|
99.1 | Press Release, dated May 7, 2009 |
GRIFFON CORPORATION | |||
|
By:
|
/s/ Patrick L. Alesia | |
Patrick L. Alesia | |||
Chief Financial Officer |
|
99.1
|
Press
release, dated May 7, 2009
|
GRIFFON
CORPORATION AND SUBSIDIARIES
|
||||||||||||||||
OPERATING
HIGHLIGHTS
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
For
the Three Months Ended
|
For
the Six Months Ended
|
|||||||||||||||
March
31,
|
March
31,
|
|||||||||||||||
PRELIMINARY
(in thousands)
|
2009
|
2008
|
2009
|
2008
|
||||||||||||
Net
Sales:
|
||||||||||||||||
Electronic
Information and
Communication
Systems
|
$ | 96,567 | $ | 98,397 | $ | 177,394 | $ | 174,257 | ||||||||
Garage
Doors
|
79,251 | 85,499 | 188,069 | 198,043 | ||||||||||||
Specialty
Plastic Films
|
100,269 | 114,675 | 212,958 | 221,073 | ||||||||||||
$ | 276,087 | $ | 298,571 | $ | 578,421 | $ | 593,373 | |||||||||
Operating
Income (Loss):
|
||||||||||||||||
Electronic
Information and
Communication
Systems
|
$ | 8,252 | $ | 7,139 | $ | 13,630 | $ | 12,622 | ||||||||
Garage
Doors
|
(11,841 | ) | (8,946 | ) | (16,234 | ) | (10,321 | ) | ||||||||
Specialty
Plastic Films
|
6,578 | 4,352 | 12,114 | 10,350 | ||||||||||||
Segment
operating income
|
2,989 | 2,545 | 9,510 | 12,651 | ||||||||||||
Unallocated
amounts
|
(4,759 | ) | (5,128 | ) | (9,208 | ) | (10,357 | ) | ||||||||
Gain
from debt extinguishment, net
|
— | — | 6,714 | — | ||||||||||||
Interest,
net
|
(2,688 | ) | (2,899 | ) | (4,966 | ) | (5,154 | ) | ||||||||
Income
(loss) from continuing
operations
before income taxes
|
$ | (4,458 | ) | $ | (5,482 | ) | $ | 2,050 | $ | (2,860 | ) |
PRELIMINARY
|
Three
Months
Ended
March 31,
|
Six
Months
Ended
March 31,
|
||||||||||||||
2009
|
2008
|
2009
|
2008
|
|||||||||||||
Net
sales
|
$ | 276,087 | $ | 298,571 | $ | 578,421 | $ | 593,373 | ||||||||
Cost
of sales
|
222,112 | 241,121 | 465,489 | 471,165 | ||||||||||||
Gross
profit
|
53,975 | 57,450 | 112,932 | 122,208 | ||||||||||||
Selling,
general and administrative expenses
|
55,545 | 60,114 | 112,073 | 119,101 | ||||||||||||
Restructuring
and other related charges
|
— | 701 | — | 2,392 | ||||||||||||
Total
operating expenses
|
55,545 | 60,815 | 112,073 | 121,493 | ||||||||||||
Income
(loss) from operations
|
(1,570 | ) | (3,365 | ) | 859 | 715 | ||||||||||
Other
income (expense):
|
||||||||||||||||
Interest
expense
|
(2,919 | ) | (3,498 | ) | (5,633 | ) | (6,634 | ) | ||||||||
Interest
income
|
231 | 599 | 667 | 1,480 | ||||||||||||
Gain
from debt extinguishment, net
|
— | — | 6,714 | — | ||||||||||||
Other,
net
|
(200 | ) | 782 | (557 | ) | 1,579 | ||||||||||
Total
other income (expense)
|
(2,888 | ) | (2,117 | ) | 1,191 | (3,575 | ) | |||||||||
Income
(loss) from continuing operations before
income
taxes
|
(4,458 | ) | (5,482 | ) | 2,050 | (2,860 | ) | |||||||||
Benefit
for income taxes
|
(2,955 | ) | (1,336 | ) | (718 | ) | (253 | ) | ||||||||
Income
(loss) from continuing operations before discontinued
operations
|
(1,503 | ) | (4,146 | ) | 2,768 | (2,607 | ) | |||||||||
Discontinued
operations:
|
||||||||||||||||
Income
(loss) from operations of the discontinued Installation Services
business
|
1,046 | (19,208 | ) | 1,051 | (24,223 | ) | ||||||||||
Provision
(benefit) for income taxes
|
397 | (1,985 | ) | 399 | (4,106 | ) | ||||||||||
Income
(loss) from discontinued operations
|
649 | (17,223 | ) | 652 | (20,117 | ) | ||||||||||
Net
income (loss)
|
$ | (854 | ) | $ | (21,369 | ) | $ | 3,420 | $ | (22,724 | ) | |||||
Basic
earnings (loss) per common share:
|
||||||||||||||||
Continuing
operations
|
$ | (.03 | ) | $ | (.13 | ) | $ | .05 | $ | (.08 | ) | |||||
Discontinued
operations
|
.01 | (.53 | ) | .01 | (.62 | ) | ||||||||||
$ | (.02 | ) | $ | (.66 | ) | $ | .06 | $ | (.70 | ) | ||||||
Diluted
earnings (loss) per common share:
|
||||||||||||||||
Continuing
operations
|
$ | (.03 | ) | $ | (.13 | ) | $ | .05 | $ | (.08 | ) | |||||
Discontinued
operations
|
.01 | (.53 | ) | .01 | (.62 | ) | ||||||||||
$ | (.02 | ) | $ | (.66 | ) | $ | .06 | $ | (.70 | ) | ||||||
Weighted-average
shares outstanding - basic
|
58,467 | 32,485 | 58,660 | 32,482 | ||||||||||||
Weighted-average
shares outstanding - diluted
|
58,467 | 32,485 | 58,745 | 32,482 |
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
||||||||
(in
thousands)
|
||||||||
(Unaudited)
|
||||||||
PRELIMINARY
|
March
31,
|
September
30,
|
||||||
2009
|
2008
|
|||||||
ASSETS
|
||||||||
Current
Assets:
|
||||||||
Cash
and cash equivalents
|
$ | 274,315 | $ | 311,921 | ||||
Accounts
receivable, net
|
154,113 | 163,586 | ||||||
Contract
costs and recognized income not yet billed
|
59,777 | 69,001 | ||||||
Inventories
|
155,908 | 167,158 | ||||||
Prepaid
expenses and other current assets
|
54,190 | 52,430 | ||||||
Assets
of discontinued operations
|
4,417 | 9,495 | ||||||
Total
current assets
|
702,720 | 773,591 | ||||||
Property,
plant and equipment, at cost, net of
|
||||||||
depreciation
and amortization
|
222,515 | 239,003 | ||||||
Costs
in excess of fair value of net assets of
|
||||||||
businesses
acquired
|
86,450 | 93,782 | ||||||
Intangible
assets, net
|
31,664 | 34,777 | ||||||
Other
assets
|
24,147 | 22,067 | ||||||
Assets
of discontinued operations
|
9,025 | 8,346 | ||||||
$ | 1,076,521 | $ | 1,171,566 | |||||
LIABILITIES AND SHAREHOLDERS’
EQUITY
|
||||||||
Current
Liabilities:
|
||||||||
Notes
payable and current portion of long-term debt
|
$ | 3,508 | $ | 2,258 | ||||
Accounts
payable
|
101,295 | 129,823 | ||||||
Accrued
liabilities
|
60,776 | 64,450 | ||||||
Liabilities
of discontinued operations
|
7,586 | 14,917 | ||||||
Total
current liabilities
|
173,165 | 211,448 | ||||||
Long-term
debt
|
192,918 | 230,930 | ||||||
Other
liabilities
|
60,872 | 59,460 | ||||||
Liabilities
of discontinued operations
|
9,462 | 10,048 | ||||||
Shareholders’
equity
|
640,104 | 659,680 | ||||||
$ | 1,076,521 | $ | 1,171,566 |
GRIFFON
CORPORATION AND SUBSIDIARIES
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in
thousands)
|
||||||||
(Unaudited)
|
||||||||
Six
Months Ended March 31,
|
||||||||
PRELIMINARY
|
2009
|
2008
|
||||||
CASH
FLOWS FROM OPERATING ACTIVITIES – CONTINUING OPERATIONS:
|
||||||||
Net
income (loss)
|
$ | 3,420 | $ | (22,724 | ) | |||
Loss
(income) from discontinued operations
|
(652 | ) | 20,117 | |||||
Adjustments
to reconcile net income (loss) to net
cash
provided by operating activities of continuing operations:
|
||||||||
Depreciation
and amortization
|
20,910 | 21,149 | ||||||
Stock-based
compensation
|
1,841 | 1,194 | ||||||
Recovery
of losses on accounts receivable
|
379 | 246 | ||||||
Amortization
of deferred financing costs
|
1,071 | 495 | ||||||
Gain
from debt extinguishment, net
|
(6,714 | ) | — | |||||
Deferred
income taxes
|
(1,975 | ) | 707 | |||||
Change
in assets and liabilities:
|
||||||||
Decrease
in accounts receivable and contract
costs
and recognized income not yet billed
|
14,680 | 18,312 | ||||||
Decrease
(increase) in inventories
|
9,582 | (8,492 | ) | |||||
Decrease
(increase) in prepaid expenses and other assets
|
1,277 | (8,692 | ) | |||||
Increase
(decrease) in accounts payable, accrued
liabilities
and income taxes payable
|
(36,914 | ) | 11,438 | |||||
Other
changes, net
|
(1,618 | ) | (4,159 | ) | ||||
1,867 | 52,315 | |||||||
Net
cash provided by operating activities – continuing
operations
|
5,287 | 29,591 | ||||||
CASH
FLOWS FROM INVESTING ACTIVITIES – CONTINUING OPERATIONS:
|
||||||||
Acquisition
of property, plant and equipment
|
(12,088 | ) | (11,796 | ) | ||||
Acquired
businesses
|
— | (1,750 | ) | |||||
Proceeds
from sale of investment
|
— | 1,000 | ||||||
Decrease
(increase) in equipment lease deposits
|
(345 | ) | 4,024 | |||||
Net
cash used in investing activities – continuing operations
|
(12,433 | ) | (8,522 | ) | ||||
CASH
FLOWS FROM FINANCING ACTIVITIES – CONTINUING OPERATIONS:
|
||||||||
Proceeds
from issuance of shares from rights offering
|
5,274 | — | ||||||
Purchase
of shares for treasury
|
— | (579 | ) | |||||
Proceeds
from issuance of long-term debt
|
10,431 | 50,000 | ||||||
Payments
of long-term debt
|
(41,240 | ) | (76,716 | ) | ||||
Increase
in short-term borrowings
|
904 | 377 | ||||||
Financing
costs
|
(227 | ) | (1,044 | ) | ||||
Purchase
of ESOP shares
|
(4,370 | ) | — | |||||
Other,
net
|
629 | 480 | ||||||
Net
cash used in financing activities – continuing operations
|
(28,599 | ) | (27,482 | ) | ||||
CASH
FLOWS FROM DISCONTINUED OPERATIONS:
|
||||||||
Net
cash provided by (used in) operating activities
|
(759 | ) | 340 | |||||
Net
cash used in investing activities
|
— | (254 | ) | |||||
Net
cash provided by (used in) discontinued operations
|
(759 | ) | 86 | |||||
Effect
of exchange rate changes on cash and cash equivalents
|
(1,102 | ) | 981 | |||||
NET
DECREASE IN CASH AND CASH EQUIVALENTS
|
(37,606 | ) | (5,346 | ) | ||||
CASH
AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
311,921 | 44,747 | ||||||
CASH
AND CASH EQUIVALENTS AT END OF PERIOD
|
$ | 274,315 | $ | 39,401 |
GRIFFON
CORPORATION AND SUBSIDIARIES
|
||||||||||||||||
RECONCILIATION
OF NON-GAAP MEASURES
SEGMENT
OPERATING INCOME AND SEGMENT ADJUSTED EBITDA
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
The
following is a reconciliation of operating income, which is a GAAP measure
of our operating results, to segment operating income and segment adjusted
EBITDA. Management believes that the presentation of segment operating
income and segment adjusted EBITDA is appropriate to provide additional
information about the Company’s reportable segments. Segment operating
income and segment adjusted EBITDA are not presentations made in
accordance with GAAP, are not measures of financial performance or
condition, liquidity or profitability of the Company, and should not be
considered as an alternative to (1) net income, operating income or any
other performance measures determined in accordance with GAAP or (2)
operating cash flows determined in accordance with GAAP. Additionally,
segment operating income and segment adjusted EBITDA are not intended to
be measures of free cash flow for management’s discretionary use, as they
do not consider certain cash requirements such as interest payments, tax
payments, capital expenditures and debt service
requirements.
|
||||||||||||||||
For
the Three Months Ended
|
For
the Six Months Ended
|
|||||||||||||||
March
31,
|
March
31,
|
|||||||||||||||
PRELIMINARY
(in thousands)
|
2009
|
2008
|
2009
|
2008
|
||||||||||||
Operating
income – as reported
|
$ | (1,570 | ) | $ | (3,365 | ) | $ | 859 | $ | 715 | ||||||
Corporate
and related charges
|
4,759 | 5,128 | 9,208 | 10,357 | ||||||||||||
Other
income (expense)
|
(200 | ) | 782 | (557 | ) | 1,579 | ||||||||||
Segment
operating income
|
2,989 | 2,545 | 9,510 | 12,651 | ||||||||||||
Depreciation
and amortization
|
10,044 | 10,272 | 20,526 | 20,568 | ||||||||||||
Restructuring
charges
|
— | 701 | — | 2,392 | ||||||||||||
Segment
adjusted EBITDA
|
$ | 13,033 | $ | 13,518 | $ | 30,036 | $ | 35,611 |
GRIFFON
CORPORATION AND SUBSIDIARIES
|
||||||||||||||||
RECONCILIATION
OF NON-GAAP MEASURES
SEGMENT
ADJUSTED EBITDA – BY REPORTABLE SEGMENT
|
||||||||||||||||
(Unaudited)
|
||||||||||||||||
For
the Three Months Ended
|
For
the Six Months Ended
|
|||||||||||||||
March
31,
|
March
31,
|
|||||||||||||||
PRELIMINARY
(in thousands)
|
2009
|
2008
|
2009
|
2008
|
||||||||||||
Electronic
Information and Communication Systems:
|
||||||||||||||||
Segment
operating income
|
$ | 8,252 | $ | 7,139 | $ | 13,630 | $ | 12,622 | ||||||||
Depreciation
and amortization
|
1,543 | 1,465 | 3,030 | 2,918 | ||||||||||||
Segment
adjusted EBITDA
|
$ | 9,795 | $ | 8,604 | $ | 16,660 | $ | 15,540 | ||||||||
Garage
Doors:
|
||||||||||||||||
Segment
operating income
|
$ | (11,841 | ) | $ | (8,946 | ) | $ | (16,234 | ) | $ | (10,321 | ) | ||||
Depreciation
and amortization
|
3,254 | 3,221 | 6,486 | 6,480 | ||||||||||||
Restructuring
charges
|
— | 701 | — | 2,392 | ||||||||||||
Segment
adjusted EBITDA
|
$ | (8,587 | ) | $ | (5,024 | ) | $ | (9,748 | ) | $ | (1,449 | ) | ||||
Specialty
Plastic Films:
|
||||||||||||||||
Segment
operating income
|
$ | 6,578 | $ | 4,352 | $ | 12,114 | $ | 10,350 | ||||||||
Depreciation
and amortization
|
5,247 | 5,586 | 11,010 | 11,170 | ||||||||||||
Segment
adjusted EBITDA
|
$ | 11,825 | $ | 9,938 | $ | 23,124 | $ | 21,520 | ||||||||
All
segments:
|
||||||||||||||||
Segment
operating income
|
$ | 2,989 | $ | 2,545 | $ | 9,510 | $ | 12,651 | ||||||||
Depreciation
and amortization
|
10,044 | 10,272 | 20,526 | 20,568 | ||||||||||||
Restructuring
charges
|
— | 701 | — | 2,392 | ||||||||||||
Segment
adjusted EBITDA
|
$ | 13,033 | $ | 13,518 | $ | 30,036 | $ | 35,611 |