2014

NCI Building Systems Reports Fourth Quarter Fiscal 2011 Results Fourth Quarter Highlights -- Operating Income and EBITDA More than Doubled on a 17% Revenue Increase-- Broad-based Revenue Growth and Profitability Led By Engineered Building Systems-- Net Income was $3.4 million-- Bookings Increased 35%

Fiscal 2011 Highlights -- Revenues Increased 10% to $960 million-- Adjusted EBITDA was $35.6 million, up 121%-- Cash Flow From Operations Reached $42 million-- Backlog at Fiscal Year-end was $215 million

HOUSTON, Dec. 6, 2011 /PRNewswire/ -- NCI Building Systems, Inc. (NYSE: NCS) today reported financial results for the fourth quarter and fiscal year ended October 30, 2011.

Fourth Quarter 2011 Financial Results

"Our fourth quarter results clearly demonstrate the significant operating leverage that is built into our business model as a result of the restructuring we have executed in our manufacturing, engineering and supply-chain operations over the past three years. These internal improvements have enabled us to post increases in profitability that far outpace revenue and volume gains, benefiting from even modestly better business conditions," said Norman C. Chambers, Chairman, President and Chief Executive Officer. "In the fourth fiscal quarter, our total volume was up 6.4% on a year-over-year basis, while new starts in the nonresidential construction market measured in square footage declined 4.1% as reported by McGraw-Hill. This outperformance reflected improved demand from certain sectors of our addressable market as well as our ability to maintain or increase market share across all of our business segments."

"Each of our business units contributed to operating profitability in the fourth quarter, led again this quarter by our Engineered Buildings group, which moved to an operating profit of $10.7 million from a year-ago operating loss of $3.9 million, on a 21% revenue increase. Similar to the third quarter, bookings increased substantially, up 35% year-over-year. For the third consecutive quarter, we experienced a significant increase in the rate of converting our backlog into production, a metric that was up nearly 30% this period compared to the last several years. This was due to the continued greater proportion of "book for production" business in our backlog and our shortened delivery times, both changes largely driven by the success of our Express Buildings program."

"As expected, second half fiscal 2011 performance was significantly better than that of the first half, reflecting the combination of improved conditions in markets such as manufacturing, energy and mining, which have historically accounted for a large portion of our business, and the increased efficiency of our operating footprint. In the last six months of the fiscal year, we achieved year-over-year growth in revenues and adjusted EBITDA of 11.7%, and 82.6%, respectively, and revenues for the second half of the fiscal year were 145% higher than our backlog at April 30, 2011, representing a return to more normalized performance levels."

For the fourth fiscal quarter, sales were $282 million, up 17% from the $241 million reported in last year's fourth quarter and a 7.5% sequential increase over the $262 million reported in the prior quarter. Gross profit margin was 21% compared to 19.2% in the year-ago fourth quarter and 21.7% in the prior quarter. Excluding the asset impairment charge of $1.2 million, gross profit margin would have been 21.4% for this year's fourth quarter.

Engineering, selling, general and administrative expenses were $51.1 million, or 18.1% of revenues. This compares to $48.5 million, or 20.1% of revenues in last year's fourth quarter, and $50.9 million, or 19.4% of revenues in the prior quarter. The Company posted an adjusted operating profit of $9.3 million compared to last year's fourth quarter adjusted operating loss of $1.7 million and an adjusted operating profit of $5.9 million in the third quarter of fiscal 2011. Adjusted EBITDA, defined as earnings before interest, taxes, depreciation and amortization, and cash and other non-cash items, in accordance with the Company's bank credit agreement was $17.5 million compared to $7.5 million in last year's fourth quarter and $14.7 million for the 2011 third quarter.

For the fourth fiscal quarter, the Company reported net income of $3.4 million. Including the accrual of preferred stock dividends and accretion of $6.5 million and a non-cash beneficial conversion feature charge of $1.4 million, the net loss applicable to common shares was $4.4 million. In last year's fourth quarter, the Company incurred a net loss of $5.4 million and net loss applicable to common shares of $18.6 million, which included the accrual of preferred stock dividends and accretion of $8.9 million and a non-cash beneficial conversion feature charge of $4.2 million. In the 2011 third quarter, the Company reported net income of $2.6 million. The net loss applicable to common shares was $13.1 million, which included the accrual of convertible preferred stock dividends and accretion of $9.2 million and a non-cash beneficial conversion feature benefit of $6.5 million.

For this year's fourth fiscal quarter, the adjusted loss per diluted share, excluding the non-cash beneficial conversion charge and other special items, was $0.11; the reported net loss per diluted share was $0.24. This compares to an adjusted net loss per diluted share of $0.72 and a reported net loss per diluted share of $1.01 in last year's fourth quarter, and an adjusted net loss per diluted share of $0.38 and a reported net loss per diluted share of $0.71 in the 2011 third quarter.

The weighted average number of common shares used in the calculation of fourth fiscal quarter 2011 per share amounts was 18.6 million compared to 18.4 million last year.

Inventory levels increased 8.8% over last year's fourth quarter to $88.5 million, as higher per unit costs more than offset the benefit of having lower quantities of steel on hand than in the year-ago period. Annualized inventory turnover was 8.9 turns for the fourth quarter compared to 8.6 turns for the fourth quarter last year.

For full year 2011, capital expenditures were $21 million; net cash from operating activities was positive $42 million.

Recent Development

As previously reported, the Company's ability to pay cash dividends on its Series B Cumulative Convertible Participating Preferred Stock is limited by the terms of the Company's credit facility. If not paid in cash at an 8% rate, the Company has the option to pay the dividend in-kind (or "PIK") at 12%.  For the second consecutive quarter, the Company has reached an agreement with the holders of the preferred stock to pay the dividend due on December 15, 2011 in-kind, but at the lower rate of 8%. The determination of cash payment versus PIK of the preferred dividends will be made each quarter, and there is no assurance that the holders of preferred stock will agree to this lower rate of 8% in future periods.

Fourth Quarter Segment Performance

The Company reported an adjusted operating profit of $9.3 million, which is reconciled with the reported GAAP operating income (loss) in the table below.

NCI BUILDING SYSTEMS, INC.

BUSINESS SEGMENTS

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

RECONCILIATION OF OPERATING INCOME (LOSS) TO 

ADJUSTED OPERATING INCOME (LOSS) EXCLUDING SPECIAL CHARGES

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 For the Three Months Ended October 30, 2011 

 

 

 Metal Coil
Coating

 

 Metal
Components 

 

 Engineered
Building
Systems 

 

 Corporate 

 

 Consolidated 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss), GAAP basis  

$     4,903

 

$      6,345

 

$     10,698

 

$   (14,162)

 

$      7,784

 

Asset impairments

-

 

9

 

958

 

247

 

1,214

 

Restructuring charges

-

 

-

 

283

 

-

 

283

 

"Adjusted" operating income (loss) (1)

$     4,903

 

$      6,354

 

$     11,939

 

$   (13,915)

 

$      9,281

 

 

 

 

 

 

 

 

 

 

 

 

(1)  The Company discloses a tabular comparison of "Adjusted" operating income (loss), which is a non-GAAP measure because it is instrumental 

 

       in comparing the results from period to period.  "Adjusted" operating income (loss) should not be considered in isolation or as a substitute

 

       for operating income (loss) as reported on the face of our consolidated statement of operations.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

"Each of our three business segments contributed to the strong improvement in operating results in the 2011 fourth quarter," Mr. Chambers said.

The Components group's third-party sales increased 11% in the fourth quarter as compared to the year-ago period on a modest increase in volume. Similar to the third quarter, higher raw material costs reduced the unit's profitability. Cost containment initiatives, however, enabled the segment to maintain a reasonable operating margin.

The Coatings group continued to successfully sell its products to end users outside of the nonresidential construction industry and posted a 23% increase in third-party sales. Operating income increased 31% compared to the prior year as a result of higher volumes, which was reflected in double-digit increases in both third-party and intersegment sales.

The Buildings group's third-party revenues increased 20% year-over-year, and operating profit was $10.7 million, representing a $14.6 million improvement over the prior year. Improved demand for "design and build" projects, effective brand marketing, superior execution and commercial discipline all contributed to the significantly improved results.

Full Year 2011 Highlights

  • Revenues increased 10% to $960 million from $871 million
  • Adjusted EBITDA was $35.6 million, up 121% from $16.1 million
  • Cash Flow from Operations was $42 million up from $6.3 million
  • Net debt was reduced to $51.7 million from $58.9 million at last year's fiscal year-end

Market Commentary

McGraw-Hill reported that new construction activity measured in square feet was down 4.1% in the fourth quarter of the Company's fiscal 2011 compared to the same period of 2010. For fiscal year 2011, NCI's traditionally strong manufacturing and warehousing market increased 11% compared to a 5% decline for the overall nonresidential market, as reported in McGraw-Hill's October data.

The American Institute of Architect's Architectural Billing Index published for October was somewhat improved but still below the benchmark level that indicates expansion. However, the commercial and industrial sector of the index posted its second consecutive month of growth in October.

Outlook

"For the first time since 2007, we returned to our historical seasonal pattern of fourth quarter results outpacing those of the third quarter, which we believe points to positive momentum as we enter fiscal 2012. There is still little evidence of a sustained U.S. economic recovery that would benefit all of our businesses, and global economic conditions remain a concern. Our Buildings group's bookings and backlog continues to point to a much improved start of 2012. Stronger first half comparisons coupled with our expectations for improved performance resulting from our operating leverage and business unit growth initiatives should enable us to deliver another year of significant improvement in EBITDA," Mr. Chambers concluded.

The NCI Building Systems, Inc. fourth quarter conference call is scheduled for December 6, 2011, at 5:00 PM ET. Please call 1-800-860-2442 (International: 412-858-4600) to participate in the call. To listen to a live broadcast of the call over the Internet or to review the archived call, please visit the Company's website at www.ncilp.com. To access the taped replay, please dial 1-877-344-7529 or 412-317-0088 and the passcode 10007046# when prompted. The Webcast archive and taped replay will both be available two hours after the call through December 13, 2011.

NCI Building Systems, Inc. is one of North America's largest integrated manufacturers of metal products for the nonresidential building industry. NCI is comprised of a family of companies operating manufacturing facilities across the United States and Mexico, with additional sales and distribution offices throughout the United States and Canada.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "guidance," "potential," "anticipate," "plan," "expect," "should," "will" or similar expressions are intended to identify forward-looking statements in this press release. These forward-looking statements reflect our current expectations and/or beliefs concerning future events. However, these forward-looking statements are subject to a number of risks and uncertainties that may cause the Company's actual performance to differ materially from that projected in such statements. Among the factors that could cause actual results to differ materially include, but are not limited to, industry cyclicality and seasonality and adverse weather conditions; ability to service the Company's debt; fluctuations in customer demand and other patterns; raw material pricing and supply; competitive activity and pricing pressure; general economic conditions affecting the construction industry; financial crises or fluctuations in the U.S. and abroad; changes in laws or regulations; and the volatility of the Company's stock price. See also the risk factors in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2010 and in its subsequent quarterly reports on Form 10-Q, which identify other important factors, though not necessarily all such factors, that could cause future outcomes to differ materially from those set forth in the forward-looking statements. NCI expressly disclaims any obligation to release publicly any updates or revisions to these forward-looking statements, whether as a result of new information, future events or otherwise.

 NCI BUILDING SYSTEMS, INC. 

 CONSOLIDATED STATEMENTS OF OPERATIONS 

 (Unaudited) 

 (In thousands, except per share data) 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 For the Three Months Ended 

 

 For the Year Ended 

 

 

 October 30, 

 

 October 31, 

 

 October 30, 

 

 October 31, 

 

 

2011

 

2010

 

2011

 

2010

 

 

 

 

 

 

 

 

 

 Sales 

 

$         281,788

 

$           241,454

 

$         959,577

 

$            870,526

 Cost of sales, excluding asset impairments, net 

 

221,382

 

194,876

 

758,023

 

699,641

 Asset impairments, net 

 

1,214

 

221

 

1,121

 

1,070

      Gross profit 

 

59,192

 

46,357

 

200,433

 

169,815

 

 

21.0%

 

19.2%

 

20.9%

 

19.5%

 

 

 

 

 

 

 

 

 

 Engineering, selling, general and administrative expenses 

 

51,125

 

48,503

 

202,352

 

190,870

 Restructuring charges (recovery) 

 

283

 

1,628

 

(292)

 

3,532

      Income (loss) from operations 

 

7,784

 

(3,774)

 

(1,627)

 

(24,587)

 

 

 

 

 

 

 

 

 

 Interest income 

 

24

 

22

 

127

 

91

 Interest expense 

 

(3,709)

 

(4,280)

 

(15,723)

 

(17,918)

 Refinancing costs 

 

-

 

250

 

-

 

76

 Other income (expense), net 

 

(290)

 

552

 

876

 

2,131

 

 

 

 

 

 

 

 

 

 Income (loss) before income taxes 

 

3,809

 

(7,230)

 

(16,347)

 

(40,207)

 Provision (benefit) from income taxes 

 

398

 

(1,794)

 

(6,397)

 

(13,330)

 

 

10.4%

 

24.8%

 

39.1%

 

33.2%

 

 

 

 

 

 

 

 

 

 Net income (loss) 

 

$             3,411

 

$             (5,436)

 

$           (9,950)

 

$            (26,877)

 Convertible preferred stock dividends and accretion 

 

6,454

 

8,877

 

28,120

 

34,055

 Convertible preferred stock beneficial conversion feature 

 

1,356

 

4,243

 

9,396

 

250,295

 Net loss applicable to common shares 

 

$           (4,399)

 

$           (18,556)

 

$         (47,466)

 

$          (311,227)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 Loss per common share: 

 

 

 

 

 

 

 

 

    Basic 

 

$             (0.24)

 

$               (1.01)

 

$             (2.58)

 

$              (17.07)

    Diluted 

 

$             (0.24)

 

$               (1.01)

 

$             (2.58)

 

$              (17.07)

 

 

 

 

 

 

 

 

 

 Weighted average number of common shares outstanding: 

 

 

 

 

 

 

 

 

    Basic 

 

18,632

 

18,365

 

18,369

 

18,229

    Diluted 

 

18,632

 

18,365

 

18,369

 

18,229

 

 

 

 

 

 

 

 

 

 Increase in sales 

 

16.7%

 

 

 

10.2%

 

 

 

 

 

 

 

 

 

 

 

 Gross profit percentage 

 

21.0%

 

19.2%

 

20.9%

 

19.5%

 

 

 

 

 

 

 

 

 

 Engineering, selling, general and administrative 

 

 

 

 

 

 

 

 

expenses percentage 

 

 

18.1%

 

 

20.1%

 

 

21.1%

 

 

21.9%

 NCI BUILDING SYSTEMS, INC. 

 CONSOLIDATED BALANCE SHEETS 

 (In thousands) 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 October 30, 

 

 October 31, 

 

 

 

 

2011

 

2010

 

 

 

 

 (Unaudited) 

 

 

 ASSETS 

 

 

 

 

 

 Cash and cash equivalents 

 

$           78,982

 

$           77,419

 

 Restricted cash 

 

2,836

 

2,839

 

 Accounts receivable, net 

 

95,381

 

81,896

 

 Inventories, net 

 

88,531

 

81,386

 

 Deferred income taxes 

 

20,405

 

15,101

 

 Income tax receivable 

 

1,272

 

15,919

 

 Prepaid expenses and other 

 

14,847

 

13,923

 

 Investments in debt and equity securities, at market 

 

4,483

 

3,738

 

 Assets held for sale 

 

4,874

 

6,114

 

 

 Total current assets 

 

311,611

 

298,335

 

 

 

 

 

 

 

 

 Property plant and equipment, net 

 

208,514

 

214,453

 

 Goodwill  

 

5,200

 

5,200

 

 Intangible assets, net 

 

24,254

 

26,312

 

 Other assets 

 

11,575

 

16,224

 

 

 Total assets 

 

$         561,154

 

$         560,524

 

 

 

 

 

 

 

 LIABILITIES AND STOCKHOLDERS' DEFICIT  

 

 

 

 

 

 Note payable 

 

$                292

 

$                289

 

 Accounts payable 

 

88,158

 

70,589

 

 Accrued compensation and benefits 

 

34,616

 

31,731

 

 Accrued interest 

 

1,309

 

1,546

 

 Other accrued expenses 

 

49,668

 

46,723

 

 

 Total current liabilities 

 

174,043

 

150,878

 

 

 

 

 

 

 

 

 Long-term debt 

 

130,699

 

136,305

 

 Deferred income taxes 

 

7,312

 

10,947

 

 Other long-term liabilities 

 

10,081

 

4,820

 

 

 Total long-term liabilities 

 

148,092

 

152,072

 

 

 

 

 

 

 

 

 Series B cumulative convertible participating preferred stock 

 

273,950

 

256,870

 

 

 

 

 

 

 

 

 Redeemable common stock  

 

759

 

3,418

 

 

 

 

 

 

 

 

 Common stock 

 

924

 

921

 

 Additional paid-in capital 

 

235,767

 

255,248

 

 Accumulated deficit 

 

(266,896)

 

(256,946)

 

 Accumulated other comprehensive loss 

 

(5,485)

 

(1,937)

 

 

 Total stockholders' deficit 

 

(35,690)

 

(2,714)

 

 

 

 

 

 

 

 

 

 Total liabilities and stockholders' deficit 

 

$         561,154

 

$         560,524

 

 

 

 

 

 

 

NCI BUILDING SYSTEMS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

For the Year Ended

 

 

 October 30, 2011 

 

 October 31, 2010 

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

      Net loss

 

$                    (9,950)

 

$                (26,877)

      Adjustments to reconcile net loss to net cash provided by 

 

 

 

 

            operating activities:

 

 

 

 

            Depreciation and amortization

 

33,214

 

34,504

            Share-based compensation expense

 

6,908

 

4,953

            Gain on embedded derivative

 

(25)

 

(937)

            Loss on sale of property, plant and equipment

 

50

 

180

            Refinancing costs

 

-

 

(76)

            Provision for doubtful accounts

 

1,844

 

78

            Asset impairments, net

 

1,121

 

1,070

            Provision (benefit) from deferred income taxes

 

(6,397)

 

43

      Changes in working capital:

 

 

 

 

            Accounts receivable

 

(15,329)

 

915

            Inventories

 

(7,145)

 

(9,849)

            Income tax receivable

 

14,382

 

12,434

            Prepaid expenses and other

 

(247)

 

1,736

            Accounts payable

 

17,569

 

150

            Accrued expenses

 

5,668

 

(12,975)

            Other, net

 

238

 

957

 

 

 

 

 

Net cash provided by operating activities

 

41,901

 

6,306

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

      Capital expenditures

 

(21,040)

 

(14,030)

      Proceeds from sale of property, plant and equipment

 

583

 

767

 

 

 

 

 

Net cash used in investing activities

 

(20,457)

 

(13,263)

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

Payment of convertible notes

 

-

 

(59)

Proceeds from ABL Facility

 

43

 

245

Payments on ABL Facility

 

(43)

 

(246)

Decrease of restricted cash

 

3

 

10,140

Payment of cash dividends on Convertible Preferred Stock

 

(11,039)

 

-

Payments on term loan

 

(5,250)

 

(13,695)

Payments on note payable

 

(1,543)

 

(1,724)

Payments on other long-term debt

 

(355)

 

(190)

Payment of financing costs

 

(200)

 

(125)

Purchase of treasury stock

 

(1,477)

 

(381)

 

 

 

 

 

Net cash used in financing activities

 

(19,861)

 

(6,035)

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

(20)

 

(8)

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

1,563

 

(13,000)

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

77,419

 

90,419

 

 

 

 

 

Cash and cash equivalents at end of period

 

$                   78,982

 

$                  77,419

 

 

 

 

 


NCI BUILDING SYSTEMS, INC

BUSINESS SEGMENTS

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Three Months Ended

 

$

%

 

 

 October 30, 2011 

 

 October 31, 2010 

 

Inc/(Dec)

Change

 

 

 

% of 

 

 

% of 

 

 

 

 

 

 

Total

 

 

Total

 

 

 

Sales:

 

 

Sales

 

 

Sales

 

 

 

Metal coil coating

 

$         56,425

16

 

$         46,884

16

 

$           9,541

20.4%

Metal components

 

127,925

37

 

118,475

39

 

9,450

8.0%

Engineered building systems

 

162,346

47

 

133,959

45

 

28,387

21.2%

Total sales

346,696

100

 

299,318

100

 

47,378

15.8%

Less: Intersegment sales

 

64,908

19

 

57,864

19

 

7,044

12.2%

Total net sales

$       281,788

81

 

$       241,454

81

 

$         40,334

16.7%

 

 

 

 

 

-

 

 

 

 

 

 

 

 % of 

 

 

 % of 

 

 

 

 

 

 

Total

 

 

Total

 

 

 

Operating income (loss):

 

 

Sales

 

 

Sales

 

 

 

Metal coil coating

 

$           4,903

9

 

$           3,754

8

 

$           1,149

30.6%

Metal components

 

6,345

5

 

8,820

7

 

(2,475)

-28.1%

Engineered building systems

 

10,698

7

 

(3,859)

(3)

 

14,557

377.2%

Corporate

 

(14,162)

-

 

(12,489)

-

 

(1,673)

-13.4%

Total operating income (loss) (% of net sales)

 

$           7,784

3

 

$          (3,774)

(2)

 

$         11,558

306.3%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fiscal Year Ended

 

Fiscal Year Ended

 

$

%

 

 

 October 30, 2011 

 

 October 31, 2010 

 

Inc/(Dec)

Change

 

 

 

% of 

 

 

% of 

 

 

 

 

 

 

Total

 

 

Total

 

 

 

Sales:

 

 

Sales

 

 

Sales

 

 

 

Metal coil coating

 

$       201,098

17

 

$       181,874

17

 

$         19,224

10.6%

Metal components

 

437,655

37

 

415,857

38

 

21,798

5.2%

Engineered building systems

 

548,594

46

 

490,746

45

 

57,848

11.8%

Total sales

 

1,187,347

100

 

1,088,477

100

 

98,870

9.1%

Less: Intersegment sales

 

227,770

19

 

217,951

20

 

9,819

4.5%

Total net sales

$       959,577

81

 

$       870,526

80

 

$         89,051

10.2%

 

 

-

 

 

-

 

 

-

 

 

 

 

 % of 

 

 

 % of 

 

 

 

 

 

 

Total

 

 

Total

 

 

 

Operating income (loss):

 

 

Sales

 

 

Sales

 

 

 

Metal coil coating

 

$         17,944

9

 

$         16,166

9

 

$           1,778

11.0%

Metal components

 

20,643

5

 

26,791

6

 

(6,148)

-22.9%

Engineered building systems

 

13,011

2

 

(18,438)

(4)

 

31,449

170.6%

Corporate

 

(53,225)

-

 

(49,106)

-

 

(4,119)

-8.4%

Total operating income (loss) (% of net sales)

 

$          (1,627)

(0)

 

$        (24,587)

(3)

 

$         22,960

93.4%

 

 

 

 

 

 

 

 

 

 

\

NCI BUILDING SYSTEMS, INC.

BUSINESS SEGMENTS

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS) EXCLUDING SPECIAL CHARGES

FOR THE THREE MONTHS ENDED October 30, 2011 AND October 31, 2010

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 For the Three Months Ended October 30, 2011 

 

 

 

 Metal Coil Coating 

 

 Metal Components 

 

 Engineered Building

Systems 

 

 Corporate 

 

 Consolidated 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss), GAAP basis

$             4,903

 

$             6,345

 

$           10,698

 

$         (14,162)

 

$           7,784

 

 

Asset impairments

-

 

9

 

958

 

247

 

1,214

 

 

Restructuring charges

-

 

-

 

283

 

-

 

283

 

 

"Adjusted" operating income (loss) (1)

$             4,903

 

$             6,354

 

$           11,939

 

$         (13,915)

 

$           9,281

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 For the Three Months Ended October 31, 2010 

 

 

 

 Metal Coil Coating 

 

 Metal Components 

 

 Engineered Building Systems 

 

 Corporate 

 

 Consolidated 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss), GAAP basis

$             3,754

 

$             8,820

 

$           (3,859)

 

$         (12,489)

 

$         (3,774)

 

 

Asset impairments 

-

 

221

 

-

 

-

 

221

 

 

Restructuring charges

-

 

95

 

1,533

 

-

 

1,628

 

 

Environmental and other contingency adjustments

-

 

-

 

178

 

-

 

178

 

 

"Adjusted" operating income (loss) (1)

$             3,754

 

$             9,136

 

$           (2,148)

 

$         (12,489)

 

$         (1,747)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)  The Company discloses a tabular comparison of "Adjusted" operating income (loss), which is a non-GAAP measure because it is instrumental 

 

 

       in comparing the results from period to period.  "Adjusted" operating income (loss) should not be considered in isolation or as a substitute

 

 

       for operating income (loss) as reported on the face of our consolidated statement of operations.

 

 

 

 

 

NCI BUILDING SYSTEMS, INC.

BUSINESS SEGMENTS

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

RECONCILIATION OF OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS) EXCLUDING SPECIAL CHARGES

FOR THE FISCAL YEAR ENDED OCTOBER 30, 2011 AND OCTOBER 31, 2010

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 For the Fiscal Year Ended October 30, 2011 

 

 

 

 Metal Coil Coating 

 

 Metal Components 

 

 Engineered Building Systems 

 

 Corporate 

 

 Consolidated 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss), GAAP basis

$           17,944

 

$           20,643

 

$           13,011

 

$         (53,225)

 

$           (1,627)

 

 

Asset impairments (recoveries)

-

 

(84)

 

958

 

247

 

1,121

 

 

Restructuring recovery

-

 

-

 

(292)

 

-

 

(292)

 

 

Pre-acquisition contingency adjustment

-

 

-

 

252

 

-

 

252

 

 

Increase in actuarial determined general liability

 

 

 

 

 

 

 

 

 

 

 

     self-insurance reserve

-

 

2,398

 

-

 

-

 

2,398

 

 

"Adjusted" operating income (loss) (1)

$           17,944

 

$           22,957

 

$           13,929

 

$         (52,978)

 

$             1,852

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 For the Fiscal Year Ended October 31, 2010 

 

 

 

 Metal Coil Coating 

 

 Metal Components 

 

 Engineered Building Systems 

 

 Corporate 

 

 Consolidated 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss), GAAP basis

$           16,166

 

$           26,791

 

$         (18,438)

 

$         (49,106)

 

$         (24,587)

 

 

Asset impairments 

-

 

147

 

923

 

-

 

1,070

 

 

Restructuring charges

-

 

510

 

3,022

 

-

 

3,532

 

 

Environmental and other contingency adjustments

-

 

-

 

178

 

-

 

178

 

 

"Adjusted" operating income (loss) (1)

$           16,166

 

$           27,448

 

$         (14,315)

 

$         (49,106)

 

$         (19,807)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)  The Company discloses a tabular comparison of "Adjusted" operating income (loss), which is a non-GAAP measure because it is instrumental 

 

       in comparing the results from period to period.  "Adjusted" operating income (loss) should not be considered in isolation or as a substitute

 

 

       for operating income (loss) as reported on the face of our consolidated statement of operations.

 

 

NCI BUILDING SYSTEMS, INC.

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

COMPUTATION OF EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION,

AMORTIZATION AND OTHER NONCASH ITEMS ("ADJUSTED EBITDA")

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1st Qtr

 

2nd Qtr

 

3rd Qtr

4th Qtr

 

Trailing 12 Months

 

 

 January 30, 

 

 May 1, 

 

July 31,

 

October 30,

 

October 30,

 

 

2011

 

2011

 

2011

 

2011

 

2011

Net income (loss)

 

$             (12,725)

 

$               (3,229)

 

$                2,593

 

$                3,411

 

$                     (9,950)

Add:

 

 

 

 

 

 

 

 

 

 

     Depreciation and amortization

 

7,236

 

7,187

 

7,187

 

6,753

 

28,363

     Consolidated interest expense, net

4,177

 

3,870

 

3,864

 

3,685

 

15,596

     Provision (benefit) from income taxes

(5,009)

 

(1,786)

 

-

 

398

 

(6,397)

     Non-cash charges:

 

 

 

 

 

 

 

 

 

 

          Stock-based compensation

 

1,685

 

1,671

 

1,776

 

1,776

 

6,908

          Asset impairments (recoveries)

 

-

 

-

 

(93)

 

1,214

 

1,121

          Embedded derivative

 

(7)

 

(6)

 

(6)

 

(6)

 

(25)

          Pre-acquisition contingency adjustment

252

 

-

 

-

 

-

 

252

     Cash restructuring charges (recoveries)

-

 

-

 

(575)

 

283

 

(292)

     Transaction costs

 

-

 

-

 

-

 

-

 

-

 

 

 

 

 

 

 

 

 

 

 

     Adjusted EBITDA (1)

 

$               (4,391)

 

$                7,707

 

$              14,746

 

$              17,514

 

$                    35,576

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1st Qtr

 

2nd Qtr

 

3rd Qtr

 

4th Qtr

 

Trailing 12 Months

 

 

 January 31, 

 

 May 2nd, 

 

 August 1, 

 

 October 31, 

 

 October 31, 

 

 

2010

 

2010

 

2010

 

2010

 

2010

Net income (loss)

 

$             (10,486)

 

$               (7,656)

 

$               (3,299)

 

$               (5,436)

 

$                   (26,877)

Add:

 

 

 

 

 

 

 

 

 

 

     Depreciation and amortization

 

7,521

 

7,480

 

7,457

 

7,309

 

29,767

     Consolidated interest expense, net

4,507

 

4,670

 

4,392

 

4,258

 

17,827

     Benefit from income taxes

 

(5,779)

 

(5,536)

 

(221)

 

(1,794)

 

(13,330)

     Non-cash charges:

 

 

 

 

 

 

 

 

 

 

          Stock-based compensation

 

801

 

1,403

 

1,374

 

1,375

 

4,953

          Asset impairments (recoveries)

 

1,029

 

(116)

 

(64)

 

221

 

1,070

          Embedded derivative

 

(919)

 

(4)

 

(7)

 

(7)

 

(937)

          Pre-acquisition contingency adjustment

-

 

-

 

-

 

178

 

178

     Cash restructuring charges

 

524

 

829

 

551

 

1,628

 

3,532

     Transaction costs

 

174

 

-

 

-

 

(250)

 

(76)

 

 

 

 

 

 

 

 

 

 

 

     Adjusted EBITDA (1)

 

$               (2,628)

 

$                1,070

 

$              10,183

 

$                7,482

 

$                    16,107

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)  On October 20, 2009, the Company amended and restated its Term Note facility which defines adjusted EBITDA.  Adjusted EBITDA excludes non-cash charges for goodwill and other asset impairments, lower of cost or market charges and stock compensation as well as certain non-recurring charges. As such, the historical information is presented in accordance with the definition above.  Concurrent with the amendment and restatement of the Term Note facility, the Company entered into an Asset-Backed Lending facility which has substantially the same definition of adjusted EBITDA except that the ABL facility caps certain non-recurring charges.  The Company is disclosing adjusted EBITDA, which is a non-GAAP measure, because it is used by management and provided to investors to provide comparability of underlying operational results.

 

 

 

 

 

 

 

 

 

 

 

NCI BUILDING SYSTEMS, INC.

NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS

"ADJUSTED" LOSS PER DILUTED COMMON SHARE AND NET LOSS COMPARISON 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

Fiscal Three Months Ended

 

Fiscal Year Ended

 

 

 

 October 30, 

 October 31, 

 

 October 30, 

 October 31, 

 

 

 

2011

2010

 

2011

2010

Loss per diluted common share, GAAP basis

 

$                  (0.24)

$                    (1.01)

 

$             (2.58)

$           (17.07)

Refinancing costs, net of taxes

 

 

-

(0.01)

 

-

(0.00)

Convertible preferred stock beneficial conversion feature

0.07

0.23

 

0.51

13.73

Restructuring charges (recovery), net of taxes

 

0.01

0.05

 

(0.01)

0.12

Asset impairments, net of taxes

 

 

0.04

0.01

 

0.04

0.03

Gain on embedded derivative, net of taxes

 

(0.00)

(0.00)

 

(0.00)

(0.03)

Increase in actuarial determined general liability self-insurance reserve, net of taxes

-

-

 

0.08

-

Pre-acquisition contingency adjustment, net of taxes

 

-

0.01

 

0.01

0.01

"Adjusted" loss per diluted common share (1)

 

$                  (0.11)

$                    (0.72)

 

$             (1.96)

$             (3.21)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fiscal Three Months Ended

 

Fiscal Year Ended

 

 

 

 October 30, 

 October 31, 

 

 October 30, 

 October 31, 

 

 

 

2011

2010

 

2011

2010

Net loss applicable to common shares, GAAP basis

 

$                (4,399)

$                (18,556)

 

$         (47,466)

$       (311,227)

Refinancing costs, net of taxes

 

 

-

(163)

 

-

(49)

Convertible preferred stock beneficial conversion feature

1,356

4,242

 

9,396

250,294

Restructuring charges (recovery), net of taxes

 

174

1,058

 

(180)

2,296

Asset impairments, net of taxes

 

 

748

144

 

691

696

Gain on embedded derivative, net of taxes

 

(4)

(4)

 

(16)

(609)

Increase in actuarial determined general liability self-insurance reserve, net of taxes

-

-

 

1,477

-

Pre-acquisition contingency adjustment, net of taxes

 

-

116

 

181

116

"Adjusted" net loss applicable to common shares (1)

 

$                (2,125)

$                (13,163)

 

$         (35,917)

$         (58,483)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 (1) The Company discloses a tabular comparison of "Adjusted" loss per diluted common share and net loss, which are non-GAAP measures, 

        because they are referred to in the text of our press releases and are instrumental in comparing the results from period to period.  "Adjusted"

        loss per diluted common share and net loss should not be considered in isolation or as a substitute for loss per diluted common share and 

        net loss as reported on the face of our consolidated statement of operations.

 

 

 

 

NCI Building Systems, Inc. 

Reconciliation of Segment Sales to Third Party Segment Sales (Internal Information) 

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

%

 

 

 

 4th Qtr 2011 

 

 

 4th Qtr 2010 

 

 Inc/(Dec) 

 Change 

 Metal Coil Coating 

 

 

 

 

 

 

 

 

 

 Total Sales 

 

56,425

16%

 

46,884

16%

9,541

20%

 

 Less:  Intersegment sales 

 

35,030

 

 

29,433

 

5,597

19%

 

 Third Party Sales 

 

21,395

8%

 

17,451

7%

3,944

23%

 

 

 

 

 

 

 

 

 

 

 

 Operating Income (Loss) 

 

4,903

23%

 

3,754

22%

1,149

31%

 

 

 

 

 

 

 

 

 

 

 Metal Components 

 

 

 

 

 

 

 

 

 

 Total 

 

127,925

36%

 

118,475

39%

9,450

8%

 

 Less:  Intersegment sales 

 

23,758

 

 

24,329

 

(571)

-2%

 

 Third Party Sales 

 

104,167

35%

 

94,146

39%

10,021

11%