UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date
of
report:
November 2, 2007 (Date of earliest event reported: November 2,
2007)
RBC
BEARINGS INCORPORATED
(EXACT
NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
|
Delaware
|
333-124824
|
95-4372080
|
|
(State
or other jurisdiction
of
incorporation)
|
(Commission
File
Number)
|
(IRS
Employer
Identification
No.)
|
One
Tribology Center
Oxford,
CT 06478
(Address
of Principal Executive Offices, Including Zip Code)
(203)
267-7001
(Registrant’s
Telephone Number, Including Area Code)
N/A
(Former
Name or Former Address, if Changed Since Last Report)
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
□
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))
Page
1
Item
2.02. Results of Operations and Financial Condition.
On
November 2, 2007 RBC Bearings Incorporated (the “Company”) issued a press
release announcing its financial results for the quarter ended September
29, 2007 and
certain other information. This press release has been furnished as
Exhibit 99.1 to this report and is incorporated herein by this
reference.
The
information in this report, including the exhibit hereto, is furnished pursuant
to Item 2.02 of Form 8-K, and is not deemed to be “filed” for purposes of
Section 18 of the Securities Exchange Act of 1934 or otherwise subject to
the liabilities of that section. The information contained herein and in the
accompanying exhibit is not incorporated by reference in any filing of the
Company under the Securities Act of 1933 or the Securities Exchange Act of
1934,
whether made before or after the date hereof and irrespective of any general
incorporation language in any filings.
Item 9.01
Financial Statements and Exhibits.
(d) Exhibits
Exhibit 99.1 Press Release of RBC Bearings Incorporated dated
November 2, 2007.
SIGNATURES
According
to the requirements of the Securities Exchange Act of 1934, the Company has
duly
caused this report to be signed on its behalf by the undersigned, hereunto
duly
authorized.
Date:
November 2, 2007
|
|
RBC
BEARINGS INCORPORATED
|
|
|
|
|
|
|
By:
|
/s/
Thomas J. Williams
|
|
|
|
|
Name:
Thomas J. Williams
|
|
|
|
Title:
Corporate General Counsel &
Secretary
|
Page
2
Press
release
RBC
Bearings Incorporated Announces Fiscal 2008 Second Quarter
Results
Oxford,
CT - November 2, 2007 - RBC Bearings Incorporated (Nasdaq: ROLL), a leading
international manufacturer of highly-engineered precision plain, roller and
ball
bearings for the industrial, defense and aerospace industries, today reported
results for the second quarter ended September 29, 2007.
Second
Quarter Highlights
|
($
in millions)
|
|
Q2
Fiscal 2008
|
|
Q2
Fiscal 2007
|
|
Change
|
|
||||||||||||
|
|
|
GAAP
|
|
Adjusted
(1)
|
|
GAAP
|
|
Adjusted
(1)
|
|
GAAP
|
|
Adjusted
(1)
|
|
||||||
|
Net
sales
|
$
|
78.2
|
$
|
73.2
|
6.8
|
%
|
|||||||||||||
|
Gross
margin
|
$
|
26.2
|
$
|
23.5
|
11.6
|
%
|
|||||||||||||
|
Gross
margin %
|
33.5
|
%
|
32.1
|
%
|
|||||||||||||||
|
Operating
income
|
$
|
14.0
|
$
|
14.4
|
$
|
12.6
|
$
|
12.8
|
11.0
|
%
|
12.7
|
%
|
|||||||
|
Net
income
|
$
|
8.7
|
$
|
9.0
|
$
|
7.4
|
$
|
7.5
|
18.6
|
%
|
20.7
|
%
|
|||||||
|
Diluted
EPS
|
$
|
0.40
|
$
|
0.41
|
$
|
0.35
|
$
|
0.35
|
14.3
|
%
|
17.1
|
%
|
|||||||
|
(1)
Results exclude items in reconciliation below.
|
|||||||||||||||||||
Six
Month Highlights
|
($
in millions)
|
Q2
Fiscal 2008
|
|
Q2
Fiscal 2007
|
|
Change
|
|
|||||||||||||
|
|
|
GAAP
|
|
Adjusted
(1)
|
|
GAAP
|
|
Adjusted
(1)
|
|
GAAP
|
|
Adjusted
(1)
|
|||||||
|
Net
sales
|
$
|
158.1
|
$
|
148.5
|
6.4
|
%
|
|||||||||||||
|
Gross
margin
|
$
|
53.7
|
$
|
47.0
|
14.2
|
%
|
|||||||||||||
|
Gross
margin %
|
34.0
|
%
|
31.7
|
%
|
|||||||||||||||
|
Operating
income
|
$
|
29.8
|
$
|
30.3
|
$
|
26.1
|
$
|
26.5
|
14.0
|
%
|
14.2
|
%
|
|||||||
|
Net
income
|
$
|
18.6
|
$
|
18.9
|
$
|
12.4
|
$
|
15.0
|
49.8
|
%
|
26.4
|
%
|
|||||||
|
Diluted
EPS
|
$
|
0.85
|
$
|
0.87
|
$
|
0.59
|
$
|
0.71
|
44.1
|
%
|
22.5
|
%
|
|||||||
|
(1)
Results exclude items in reconciliation below.
|
|||||||||||||||||||
“We
are
pleased to report another solid quarter as the summer period always presents
its
special challenges,” said Dr. Michael J. Hartnett, Chairman and Chief Executive
Officer. “Our core businesses in aircraft, defense and some of the industrial
sectors showed continued strength and our incoming orders reflected this as
backlog expanded to $191.2 million. The net income increase of nearly 19% from
the same period last year and nearly 50% in the six months ended September
29,
2007, demonstrates the continued improvement of our internal
operations.”
Second
Quarter Results
Net
sales
for the second quarter of fiscal 2008 were $78.2 million, an increase of 6.8%
from $73.2 million in the second quarter of fiscal 2007. Net sales for the
second quarter of fiscal 2008 increased 10.8% excluding the impact of the
decrease in the class 8 heavy truck market. Gross margin for the second quarter
rose 11.6% to $26.2 million compared to $23.5 million for the same period last
year. Gross margin as a percentage of net sales improved to 33.5% in the second
quarter of fiscal 2008 compared to 32.1% for the same period last year. Gross
margin was negatively impacted by approximately $0.3 million due to the move
of
our aerospace manufacturing facility in the quarter.
Operating
income increased 11.0% to $14.0 million for the second quarter of fiscal 2008
compared to $12.6 million for the same period last year. Operating income as
a
percentage of net sales was 17.9% for the second quarter of fiscal 2008 compared
to 17.2% for the same period last year. Operating income, excluding plant moving
and consolidation costs and disposal of fixed assets, was $14.4 million, an
increase of 12.7% compared to adjusted operating income for the same period
last
year. As a percentage of net sales, operating income, excluding these charges,
was 18.4% compared to 17.4% for the same adjusted period last year.
Interest
expense, net for the second quarter of fiscal 2008 was $0.7 million, a decrease
of $0.5 million, from $1.2 million for the same period last year.
For
the
second quarter of fiscal 2008, the Company reported net income of $8.7 million
compared to net income of $7.4 million in the same period last year. Net income
excluding the after tax impact of plant moving and consolidation costs, disposal
of fixed assets, and loss on early extinguishment of debt, increased 20.7%
to
$9.0 million compared to $7.5 million for the same adjusted period last
year.
Six
Month Results
Net
sales
for the six month period ended September 29, 2007 were $158.1 million, an
increase of 6.4% from $148.5 million for the six month period ended September
30, 2006. Net sales for the six month period ended September 29, 2007 increased
11.5%, excluding the impact of the decrease in the class 8 heavy truck market.
Gross margin rose 14.2% to $53.7 million compared to $47.0 million for the
same
six month period last year. Gross margin as a percentage of net sales improved
to 34.0% for the first six months of fiscal 2008 compared to 31.7% for the
same
period last year. For the six month period ended September 29, 2007, gross
margin was negatively impacted by approximately $0.3 million due to the move
of
our aerospace manufacturing facility in the second quarter.
For
the
six month period ended September 29, 2007, the Company reported operating income
of $29.8 million compared to $26.1 million for the same period last year.
Operating income excluding plant moving and consolidation costs and disposal
of
fixed assets increased 14.2% to $30.3 million for the six months ended September
29, 2007 compared to $26.5 million for the same adjusted period last year.
Operating income as a percentage of sales excluding these charges was 19.2%
for
the first six months of fiscal 2008 compared to 17.9% for the same adjusted
period last year.
Interest
expense, net for the six month period ended September 29, 2007 was $1.5 million,
a decrease of $1.9 million, from $3.4 million for the same period last year.
Net
income for the six month period ended September 29, 2007 was $18.6 million
compared to net income of $12.4 million for the same period last year. Net
income, excluding the after tax impact of plant moving and consolidation costs,
disposal of fixed assets, and loss on early extinguishment of debt, increased
26.4% to $18.9 million for the first six months of fiscal 2008 compared to
$15.0
million for the same adjusted period last year.
Coastal
Bearing Acquisition
During
the quarter, RBC Bearings Incorporated acquired the assets of CBS/Coastal
Bearing Services (“CBS”) for approximately $3.6 million. CBS, located in
Houston, Texas, manufactures, inspects, and refurbishes large bearings for
the
oil and mining industries, as well as other general industrial applications
with
sizes ranging up to 124 inches in diameter. CBS contributed to RBC’s results for
the months of August and September and its results are reported as part of
the
Company's Ball Bearings segment.
Growth
Initiatives
Over
the
next 30 months, the Company plans to invest between $25.0 to $30.0
million in equipment to expand its operations to produce large diameter
anti-friction bearings for the oil, wind, and heavy construction markets where
there is considerable demand for both existing and new products. This capacity
will be added to our existing plants in Texas, South Carolina, and
Mexico.
Outlook
“Overall,
we are pleased with the first half of fiscal 2008. We are well positioned for
a
strong second half, particularly as our team has done an outstanding job with
our recent acquisitions. We are prepared to grow our market share with new
capabilities and product offerings, and we remain focused on innovations and
refinements to our process as we close out the second half of fiscal 2008,”
concluded Dr. Hartnett.
Based
on
current market conditions, the Company expects financial performance in its
third quarter of fiscal 2008 to be as follows:
| § |
Net
sales in the range of $80.0 - $82.0
million
|
| § |
Operating
income in the range of $15.0 - $15.5 million
|
Live
Webcast
RBC
Bearings Incorporated will host a webcast at 10:30 a.m. ET today to discuss
the
quarterly results. To access the webcast, go to the investor relations portion
of the Company’s web site, www.rbcbearings.com,
on the
day of the conference call and click on the webcast icon. If you do not have
access to the Internet and wish to listen to the call, dial 888-713-4213
(international callers dial 617-213-4865) and enter conference call ID #
94765449. An audio replay of the call will be available from 12:30 p.m. ET
on
Friday, November 2nd until 11:59 p.m. ET on Friday, November 16th. The replay
can be accessed by dialing 888-286-8010 (international callers dial
617-801-6888) and entering conference call ID # 83147264.
Investors
are advised to dial into the call at least ten minutes prior to the call to
register. Participants may pre-register for the call at:
https://www.theconferencingservice.com/prereg/key.process?key=PCMVGV36M.
Pre-registrants
will be issued a PIN number to use when dialing into the live call which will
provide quick access to the conference by bypassing the operator upon
connection.
Non-GAAP
Financial Measures
In
addition to disclosing results of operations that are determined in accordance
with generally accepted accounting principles (“GAAP”), this press release also
discloses non-GAAP results of operations that exclude certain charges. These
non-GAAP measures adjust for charges that Management believes are unusual.
Management believes that the presentation of these non-GAAP measures provides
useful information to investors regarding the Company’s results of operations,
as these non-GAAP measures allow investors to better evaluate ongoing business
performance. Investors should consider non-GAAP measures in addition to, not
as
a substitute for, financial measures prepared in accordance with GAAP. A
reconciliation of the non-GAAP measures disclosed in the press release with
the
most comparable GAAP measures are included in the financial table attached
to
this press release.
About
RBC Bearings
RBC
Bearings Incorporated is an international manufacturer and marketer of highly
engineered precision bearings and components. Founded in 1919, the Company
is
primarily focused on producing highly technical or regulated bearing products
requiring sophisticated design, testing, and manufacturing capabilities for
the
diversified industrial, aerospace and defense markets. Headquartered in Oxford,
Connecticut, RBC Bearings currently employs approximately 2,030 people and
operates 20 manufacturing facilities in four countries.
Safe
Harbor for Forward Looking Statements
Certain
statements in this press release contain “forward-looking statements.” All
statements other than statements of historical fact are “forward-looking
statements” for purposes of federal and state securities laws, including the
section of this press release entitled “Outlook”; any projections of earnings,
revenue or other financial items relating to the Company, any statement of
the
plans, strategies and objectives of management for future operations; any
statements concerning proposed future growth rates in the markets we serve;
any
statements of belief; any characterization of and the Company’s ability to
control contingent liabilities; anticipated trends in the Company’s businesses;
and any statements of assumptions underlying any of the foregoing.
Forward-looking statements may include the words “may,” “estimate,” “intend,”
“continue,” “believe,” “expect,” “anticipate” and other similar words. Although
the Company believes that the expectations reflected in any forward-looking
statements are reasonable, actual results could differ materially from those
projected or assumed in any of our forward-looking statements. Our future
financial condition and results of operations, as well as any forward-looking
statements, are subject to change and to inherent risks and uncertainties beyond
the control of the Company. These risks and uncertainties include, but are
not
limited to, risks and uncertainties relating to general economic conditions,
geopolitical factors, future levels of general industrial manufacturing
activity, future financial performance, market acceptance of new or enhanced
versions of the Company’s products, the pricing of raw materials, changes in the
competitive environments in which the Company’s businesses operate, the outcome
of pending or future litigation and governmental proceedings and approvals,
estimated legal costs, increases in interest rates, the Company’s ability to
meet its debt obligations, and risks and uncertainties listed or disclosed
in
the Company’s reports filed with the Securities and Exchange Commission,
including, without limitation, the risks identified under the heading “Risk
Factors” set forth in the Company’s Annual Report filed on Form 10-K. The
Company does not intend, and undertakes no obligation, to update or alter any
forward-looking statement.
Contacts
RBC
Bearings
Daniel
A.
Bergeron
203-267-5028
dbergeron@rbcbearings.com
Ashton
Partners
Steve
Calk
(800)
281-1163
investors@rbcbearings.com
|
RBC
Bearings Incorporated
|
|||||||||||||
|
Consolidated
Statements of Operations
|
|||||||||||||
|
(dollars
in thousands, except share and per share data)
|
|||||||||||||
|
(Unaudited)
|
|||||||||||||
|
Three
Months Ended
|
|
Six
Months Ended
|
|
||||||||||
|
|
|
September
29,
|
|
September
30,
|
|
September
29,
|
|
September
30,
|
|
||||
|
|
|
2007
|
|
2006
|
|
2007
|
|
2006
|
|||||
|
Net
sales
|
$
|
78,232
|
$
|
73,248
|
$
|
158,055
|
$
|
148,479
|
|||||
|
Cost
of sales
|
51,995
|
49,745
|
104,373
|
101,467
|
|||||||||
|
Gross
margin
|
26,237
|
23,503
|
53,682
|
47,012
|
|||||||||
|
Operating
expenses:
|
|||||||||||||
|
Selling,
general and administrative
|
11,888
|
10,610
|
23,190
|
20,237
|
|||||||||
|
Other,
net
|
354
|
283
|
716
|
667
|
|||||||||
|
Total
operating expenses
|
12,242
|
10,893
|
23,906
|
20,904
|
|||||||||
|
|
|||||||||||||
|
Operating
income
|
13,995
|
12,610
|
29,776
|
26,108
|
|||||||||
|
Interest
expense, net
|
681
|
1,203
|
1,547
|
3,365
|
|||||||||
|
Loss
on early extinguishment of debt
|
27
|
-
|
27
|
3,576
|
|||||||||
|
Income
before income taxes
|
13,287
|
11,407
|
28,202
|
19,167
|
|||||||||
|
Provision
for income taxes
|
4,538
|
4,029
|
9,628
|
6,765
|
|||||||||
|
Net
income
|
$
|
8,749
|
$
|
7,378
|
$
|
18,574
|
$
|
12,402
|
|||||
|
Net
income per common share:
|
|||||||||||||
|
Basic
|
$
|
0.41
|
$
|
0.36
|
$
|
0.87
|
$
|
0.61
|
|||||
|
Diluted
|
$
|
0.40
|
$
|
0.35
|
$
|
0.85
|
$
|
0.59
|
|||||
|
Weighted
average common shares:
|
|||||||||||||
|
Basic
|
21,431,498
|
20,502,251
|
21,404,490
|
20,295,367
|
|||||||||
|
Diluted
|
21,813,063
|
21,280,571
|
21,800,754
|
21,096,895
|
|||||||||
|
Three
Months Ended
|
|
Six
Months Ended
|
|
||||||||||
|
|
|
September
29,
|
|
September
30,
|
|
September
29,
|
|
September
30,
|
|||||
|
Reconciliation
of Reported Operating Income to
|
2007
|
|
2006
|
|
2007
|
|
2006
|
||||||
|
Adjusted
Operating Income:
|
|||||||||||||
|
Reported
operating income
|
$
|
13,995
|
$
|
12,610
|
$
|
29,776
|
$
|
26,108
|
|||||
|
RBC
API facility moving costs
|
353
|
-
|
478
|
-
|
|||||||||
|
Nice
facility consolidation expense
|
-
|
82
|
-
|
315
|
|||||||||
|
Disposal
of fixed assets
|
53
|
83
|
63
|
116
|
|||||||||
|
Adjusted
operating income
|
$
|
14,401
|
$
|
12,775
|
$
|
30,317
|
$
|
26,539
|
|||||
|
Reconciliation
of Reported Net Income and
|
Three
Months Ended
|
|
|
Six
Months Ended
|
|||||||||
|
Net
Income Per Common Share to Adjusted Net
|
September
29,
|
|
|
September
30,
|
|
|
September
29,
|
|
|
September
30,
|
|||
|
Income
and Adjusted Net Income Per Common Share:
|
2007
|
|
|
2006
|
|
|
2007
|
|
|
2006
|
|||
|
|
|||||||||||||
|
Reported
net income
|
$
|
8,749
|
$
|
7,378
|
$
|
18,574
|
$
|
12,402
|
|||||
|
RBC
API facility moving costs (1)
|
232
|
-
|
315
|
-
|
|||||||||
|
Nice
facility consolidation expense (1)
|
-
|
53
|
-
|
204
|
|||||||||
|
Disposal
of fixed assets (1)
|
35
|
54
|
41
|
75
|
|||||||||
|
Loss
on early extinguishment of debt (1)
|
18
|
-
|
18
|
2,315
|
|||||||||
|
Adjusted
net income
|
$
|
9,034
|
$
|
7,485
|
$
|
18,948
|
$
|
14,996
|
|||||
|
(1)
Item was tax effected at the effective tax rate.
|
|||||||||||||
|
Adjusted
net income per common share:
|
|||||||||||||
|
Basic
|
$
|
0.42
|
$
|
0.37
|
$
|
0.89
|
$
|
0.74
|
|||||
|
Diluted
|
$
|
0.41
|
$
|
0.35
|
$
|
0.87
|
$
|
0.71
|
|||||
|
Adjusted
weighted average common shares:
|
|||||||||||||
|
Basic
|
21,431,498
|
20,502,251
|
21,404,490
|
20,295,367
|
|||||||||
|
Diluted
|
21,813,063
|
21,280,571
|
21,800,754
|
21,096,895
|
|||||||||
|
Three
Months Ended
|
|
Six
Months Ended
|
|
||||||||||
|
|
|
September
29,
|
|
September
30,
|
|
September
29,
|
|
September
30,
|
|||||
|
Segment
Data, Net External Sales:
|
2007
|
|
2006
|
|
2007
|
|
2006
|
||||||
|
Roller
bearings segment
|
$
|
23,107
|
$
|
23,356
|
$
|
46,750
|
$
|
47,597
|
|||||
|
Plain
bearings segment
|
36,175
|
33,055
|
73,895
|
67,084
|
|||||||||
|
Ball
bearings segment
|
13,832
|
12,178
|
27,253
|
24,340
|
|||||||||
|
Other
segment
|
5,118
|
4,659
|
10,157
|
9,458
|
|||||||||
|
$
|
78,232
|
$
|
73,248
|
$
|
158,055
|
$
|
148,479
|
||||||
|
|
|||||||||||||
|
|
Three
Months Ended
|
|
|
Six
Months Ended
|
|
||||||||
|
|
|
|
September
29,
|
|
|
September
30,
|
|
|
September
29,
|
|
|
September
30,
|
|
|
Selected
Financial Data:
|
2007
|
|
|
2006
|
|
|
2007
|
|
|
2006
|
|||
|
Depreciation
and amortization
|
$
|
2,533
|
$
|
2,545
|
$
|
4,946
|
$
|
4,948
|
|||||
|
Cash
provided by operating activities
|
$
|
10,160
|
$
|
14,502
|
$
|
23,590
|
$
|
27,411
|
|||||
|
Capital
expenditures
|
$
|
4,506
|
$
|
1,972
|
$
|
11,129
|
$
|
4,583
|
|||||
|
Total
debt
|
$
|
54,250
|
$
|
86,605
|
|||||||||
|
Cash
on hand
|
$
|
5,772
|
$
|
7,930
|
|||||||||
|
Total
debt minus cash on hand
|
$
|
48,478
|
$
|
78,675
|
|||||||||
|
Backlog
|
$
|
191,174
|
$
|
174,985
|
|||||||||