UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date
of
report:
November 6, 2008 (Date
of
earliest event reported:
November 6, 2008)
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) (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):
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under
the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement
communications pursuant to Rule
14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement
communications pursuant to Rule
13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item
2.02. Results of Operations and Financial Condition.
On
November 6, 2008 RBC Bearings Incorporated (the “Company”) issued a press
release announcing its financial results for the quarter ended September
27, 2008 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
6, 2008.
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 6, 2008
|
|
RBC
BEARINGS INCORPORATED
|
|
|
|
|
|
|
By:
|
/s/
Thomas J. Williams
|
|
|
|
|
Name:
Thomas J. Williams
|
|
|
|
Title:
Corporate General Counsel &
Secretary
|
Press
release
RBC
Bearings Incorporated Announces Fiscal 2009 Second Quarter
Results
Oxford,
CT - November 6, 2008 - 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 27, 2008.
Second
Quarter Highlights
|
($
in millions)
|
Q2
Fiscal 2009
|
Q2
Fiscal 2008
|
Change
|
||||||||||||||||
|
GAAP
|
Adjusted
(1)
|
GAAP
|
Adjusted
(1)
|
GAAP
|
Adjusted
(1)
|
||||||||||||||
|
Net
sales
|
$
|
94.3
|
$
|
78.2
|
20.5
|
%
|
|||||||||||||
|
Gross
margin
|
$
|
30.2
|
$
|
30.9
|
$
|
26.2
|
$
|
26.2
|
15.2
|
%
|
17.6
|
%
|
|||||||
|
Gross
margin %
|
32.0
|
%
|
32.7
|
%
|
33.5
|
%
|
33.5
|
%
|
|||||||||||
|
Operating
income
|
$
|
15.2
|
$
|
16.6
|
$
|
14.0
|
$
|
14.4
|
8.4
|
%
|
15.1
|
%
|
|||||||
|
Net
income
|
$
|
9.6
|
$
|
10.5
|
$
|
8.7
|
$
|
9.0
|
9.6
|
%
|
16.6
|
%
|
|||||||
|
Diluted
EPS
|
$
|
0.44
|
$
|
0.48
|
$
|
0.40
|
$
|
0.41
|
10.0
|
%
|
17.1
|
%
|
|||||||
|
(1)
Results exclude items in reconciliation below.
|
|||||||||||||||||||
Six
Month Highlights
|
($
in millions)
|
Q2
Fiscal 2009
|
Q2
Fiscal 2008
|
Change
|
||||||||||||||||
|
GAAP
|
Adjusted
(1)
|
GAAP
|
Adjusted
(1)
|
GAAP
|
Adjusted
(1)
|
||||||||||||||
|
Net
sales
|
$
|
186.7
|
$
|
158.1
|
18.1
|
%
|
|||||||||||||
|
Gross
margin
|
$
|
60.8
|
$
|
61.8
|
$
|
53.7
|
$
|
53.7
|
13.2
|
%
|
15.2
|
%
|
|||||||
|
Gross
margin %
|
32.6
|
%
|
33.1
|
%
|
34.0
|
%
|
34.0
|
%
|
|||||||||||
|
Operating
income
|
$
|
32.2
|
$
|
34.1
|
$
|
29.8
|
$
|
30.3
|
8.2
|
%
|
12.6
|
%
|
|||||||
|
Net
income
|
$
|
20.3
|
$
|
21.8
|
$
|
18.6
|
$
|
18.9
|
9.1
|
%
|
14.9
|
%
|
|||||||
|
Diluted
EPS
|
$
|
0.93
|
$
|
1.00
|
$
|
0.85
|
$
|
0.87
|
9.4
|
%
|
14.9
|
%
|
|||||||
|
(1)
Results exclude items in reconciliation below.
|
|||||||||||||||||||
“We
are
very pleased to report revenue growth of 20.5% and adjusted earnings per share
growth of 17.1%,” said Dr. Michael J. Hartnett, Chairman and Chief Executive
Officer. “We continue to see strength in most of our core markets and feel we
are on track for another strong year.”
Second
Quarter Results
Net
sales
for the second quarter of fiscal 2009 were $94.3 million, an increase of 20.5%
from $78.2 million in the second quarter of fiscal 2008. Gross margin for the
second quarter rose 15.2% to $30.2 million compared to $26.2 million for the
same period last year. Gross margin as a percentage of net sales was 32.0%
in
the second quarter of fiscal 2009 compared to 33.5% for the same period last
year. The decline in gross margin percentage was mainly driven by start-up
costs
associated with the Company’s expansion into new bearing products and the
inclusion of recent acquisitions which are currently operating at lower gross
margin levels. Gross margin as a percentage of sales, excluding $0.6 million
of
start-up costs, was 32.7% compared to 33.5% for the same period last
year.
Operating
income increased 8.4% to $15.2 million for the second quarter of fiscal 2009
compared to $14.0 million for the same period last year. As a percentage of
net
sales, operating income was 16.1% compared to 17.9% for the same period last
year. Operating income excluding start-up costs associated with the expansion
into new bearing products, facility moving and consolidation expenses and
disposal of fixed assets was $16.6 million, an increase of 15.1% compared to
adjusted operating income for the same period last year. As a percentage of
net
sales, operating income, excluding these charges, was 17.6% compared to 18.4%
for the same adjusted period last year.
Interest
expense, net for the second quarter of fiscal 2009 was $0.7 million, a decrease
of $0.2 million, from $0.9 million for the same period last year.
For
the
second quarter of fiscal 2009, the Company reported net income of $9.6 million
compared to net income of $8.7 million in the same period last year. Excluding
the after-tax start-up costs associated with the expansion into new bearing
products, facility moving and consolidation expenses and disposal of fixed
assets, net income increased 16.6% to $10.5 million compared to $9.0 million
for
the same adjusted period last year.
Six
Month Results
Net
sales
for the six month period ended September 27, 2008 were $186.7 million, an
increase of 18.1% from $158.1 million for the six month period ended September
29, 2007. Gross margin for the six month period ended September 27, 2008 rose
13.2% to $60.8 million compared to $53.7 million for the same period last year.
Gross margin as a percentage of net sales was 32.6% for the six month period
of
fiscal 2009 compared to 34.0% for the same period last year. The decline in
gross margin percentage was mainly driven by start-up costs associated with
the
Company’s expansion into new bearing products and the inclusion of recent
acquisitions which are currently operating at lower gross margin levels. Gross
margin as a percentage of sales, excluding $1.0 million of start-up costs,
was
33.1% compared to 34.0% for the same period last year.
For
the
six month period ended September 27, 2008, the Company reported operating income
of $32.2 million compared to $29.8 million for the same period last year.
Operating income excluding start-up costs associated with the expansion into
new
bearing products, facility moving and consolidation expenses and disposal of
fixed assets increased 12.6% to $34.1 million for the six month period ended
September 27, 2008 compared to $30.3 million for the same adjusted period last
year. Operating income as a percentage of sales excluding these charges was
18.3% for the first six months of fiscal 2009 compared to 19.2% for the same
adjusted period last year.
Interest
expense, net for the six month period ended September 27, 2008 was $1.3 million,
a decrease of $0.6 million, from $1.9 million for the same period last year.
Net
income for the six month period ended September 27, 2008 was $20.3 million
compared to net income of $18.6 million for the same period last year. Excluding
the after-tax start-up costs associated with the expansion into new bearing
products, facility moving and consolidation expenses, disposal of fixed assets
and the loss on early extinguishment of debt, net income increased 14.9% to
$21.8 million compared to $18.9 million for the same adjusted period last
year.
Plant
Move and Consolidation
The
Company completed the move of its West Coast manufacturing facility and incurred
a final charge of $0.1 million in the second quarter. The Company also started
the consolidation and rationalization of its South Carolina operations. This
consolidation has resulted in a charge of $0.6 million in the second quarter
with a final charge of approximately $0.6 million expected in the third quarter
of this fiscal year.
Liquidity
The
Company ended the second quarter of fiscal 2009 with cash of $9.2 million,
debt
of $51.2 million and availability under its credit lines of approximately $94.6
million. The banks participating in the Company’s U.S. bank facility of $150.0
million are J.P. Morgan, Bank of America, Keybank, Citigroup, and Comerica.
This
facility expires in June 2011.
Outlook
“With
regard to the second half of fiscal 2009, we remain cautious as a result of
recent world events in the financial markets. However, we are reassured as
many
of our businesses are booked through the end of this year and some well into
the
next period,” concluded Dr. Hartnett. “The introduction of new products for our
existing customers has been robust and we expect that past years’ product
development efforts and expenses will now turn into new revenues in the months
ahead.”
Based
on
current market conditions and assessments, the Company expects financial
performance in its third quarter of fiscal 2009 to be as follows:
|
§
|
Net
sales in the range of $87.0 - $92.0
million
|
|
§
|
Adjusted
operating income in the range of $14.0 - $16.0 million
|
Live
Webcast
RBC
Bearings Incorporated will host a webcast at 10:00 a.m. ET today to discuss
the
quarterly results. To access the webcast, go to the investor relations portion
of the Company’s website, www.rbcbearings.com,
and
click on the webcast icon. If you do not have access to the Internet and wish
to
listen to the call, dial 877-604-9670 (international callers dial 719-325-4873).
An audio replay of the call will be available from 1:00 p.m. ET on Thursday,
November 6th until 11:59 p.m. ET on Thursday, November 20th. The replay can
be
accessed by dialing 888-203-1112 (international callers dial 719-457-0820)
and
entering conference call ID # 4040758. Investors are advised to dial into the
call at least ten minutes prior to the call to register.
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 2,232 people and
operates 23 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
FD
Ashton
Partners
Michael
Cummings/Geoff Grande
617-747-1796
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
27,
|
September
29,
|
September
27,
|
September
29,
|
||||||||||
|
2008
|
2007
|
2008
|
2007
|
||||||||||
|
Net
sales
|
$
|
94,294
|
$
|
78,232
|
$
|
186,674
|
$
|
158,055
|
|||||
|
Cost
of sales
|
64,077
|
51,995
|
125,902
|
104,373
|
|||||||||
|
Gross
margin
|
30,217
|
26,237
|
60,772
|
53,682
|
|||||||||
|
Operating
expenses:
|
|||||||||||||
|
Selling,
general and administrative
|
13,952
|
11,888
|
27,079
|
23,190
|
|||||||||
|
Other,
net
|
1,097
|
354
|
1,479
|
716
|
|||||||||
|
Total
operating expenses
|
15,049
|
12,242
|
28,558
|
23,906
|
|||||||||
|
Operating
income
|
15,168
|
13,995
|
32,214
|
29,776
|
|||||||||
|
Interest
expense, net
|
650
|
919
|
1,331
|
1,899
|
|||||||||
|
Loss
on early extinguishment of debt
|
-
|
27
|
319
|
27
|
|||||||||
|
Other
non-operating expense (income)
|
249
|
(238
|
)
|
166
|
(352
|
)
|
|||||||
|
Income
before income taxes
|
14,269
|
13,287
|
30,398
|
28,202
|
|||||||||
|
Provision
for income taxes
|
4,681
|
4,538
|
10,127
|
9,628
|
|||||||||
|
Net
income
|
$
|
9,588
|
$
|
8,749
|
$
|
20,271
|
$
|
18,574
|
|||||
|
Net
income per common share:
|
|||||||||||||
|
Basic
|
$
|
0.44
|
$
|
0.41
|
$
|
0.94
|
$
|
0.87
|
|||||
|
Diluted
|
$
|
0.44
|
$
|
0.40
|
$
|
0.93
|
$
|
0.85
|
|||||
|
Weighted
average common shares:
|
|||||||||||||
|
Basic
|
21,567,551
|
21,431,498
|
21,564,463
|
21,404,490
|
|||||||||
|
Diluted
|
21,761,677
|
21,813,063
|
21,771,849
|
21,800,754
|
|||||||||
|
RBC
Bearings Incorporated
|
|||||||||||||
|
Consolidated
Statements of Operations
|
|||||||||||||
|
(dollars
in thousands, except share and per share data)
|
|||||||||||||
|
(Unaudited)
|
|
Three
Months Ended
|
Six
Months Ended
|
||||||||||||
|
September
27,
|
September
29,
|
September
27,
|
September
29,
|
||||||||||
|
Reconciliation
of Reported Operating Income to
|
2008
|
2007
|
2008
|
2007
|
|||||||||
|
Adjusted
Operating Income:
|
|||||||||||||
|
Reported
operating income
|
$
|
15,168
|
$
|
13,995
|
$
|
32,214
|
$
|
29,776
|
|||||
|
Large
bearing start-up costs
|
645
|
-
|
1,043
|
-
|
|||||||||
|
Facility
moving and consolidation expenses
|
389
|
353
|
487
|
478
|
|||||||||
|
Disposal
of fixed assets
|
370
|
53
|
400
|
63
|
|||||||||
|
Adjusted
operating income
|
$
|
16,572
|
$
|
14,401
|
$
|
34,144
|
$
|
30,317
|
|||||
|
Reconciliation
of Reported Net Income and
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||
|
Net
Income Per Common Share to Adjusted Net
|
September
27,
|
September
29,
|
September
27,
|
September
29,
|
|||||||||
|
Income
and Adjusted Net Income Per Common Share:
|
2008
|
2007
|
2008
|
2007
|
|||||||||
|
Reported
net income
|
$
|
9,588
|
$
|
8,749
|
$
|
20,271
|
$
|
18,574
|
|||||
|
Large
bearing start-up costs (1)
|
433
|
-
|
696
|
-
|
|||||||||
|
Facility
moving and consolidation expenses (1)
|
261
|
232
|
325
|
315
|
|||||||||
|
Disposal
of fixed assets (1)
|
249
|
35
|
267
|
41
|
|||||||||
|
Loss
on early extinguishment of debt (1)
|
-
|
18
|
213
|
18
|
|||||||||
|
Adjusted
net income
|
$
|
10,531
|
$
|
9,034
|
$
|
21,772
|
$
|
18,948
|
|||||
|
(1)
Item was tax effected at the effective tax rate.
|
|||||||||||||
|
Adjusted
net income per common share:
|
|||||||||||||
|
Basic
|
$
|
0.49
|
$
|
0.42
|
$
|
1.01
|
$
|
0.89
|
|||||
|
Diluted
|
$
|
0.48
|
$
|
0.41
|
$
|
1.00
|
$
|
0.87
|
|||||
|
Adjusted
weighted average common shares:
|
|||||||||||||
|
Basic
|
21,567,551
|
21,431,498
|
21,564,463
|
21,404,490
|
|||||||||
|
Diluted
|
21,761,677
|
21,813,063
|
21,771,849
|
21,800,754
|
|||||||||
|
RBC
Bearings Incorporated
|
|||||||||||||
|
Consolidated
Statements of Operations
|
|||||||||||||
|
(dollars
in thousands, except share and per share data)
|
|||||||||||||
|
(Unaudited)
|
|
Three
Months Ended
|
Six
Months Ended
|
||||||||||||
|
September
27,
|
September
29,
|
September
27,
|
September
29,
|
||||||||||
|
Segment
Data, Net External Sales:
|
2008
|
2007
|
2008
|
2007
|
|||||||||
|
Roller
bearings segment
|
$
|
25,666
|
$
|
23,107
|
$
|
50,623
|
$
|
46,750
|
|||||
|
Plain
bearings segment
|
43,181
|
36,175
|
86,896
|
73,895
|
|||||||||
|
Ball
bearings segment
|
16,555
|
13,832
|
31,601
|
27,253
|
|||||||||
|
Other
segment
|
8,892
|
5,118
|
17,554
|
10,157
|
|||||||||
|
$
|
94,294
|
$
|
78,232
|
$
|
186,674
|
$
|
158,055
|
||||||
|
Three
Months Ended
|
Six
Months Ended
|
||||||||||||
|
September
27,
|
September
29,
|
September
27,
|
September
29,
|
||||||||||
|
Selected
Financial Data:
|
2008
|
2007
|
2008
|
2007
|
|||||||||
|
Depreciation
and amortization
|
$
|
3,250
|
$
|
2,533
|
$
|
6,416
|
$
|
4,946
|
|||||
|
Cash
provided by operating activities
|
$
|
2,230
|
$
|
10,160
|
$
|
23,943
|
$
|
23,590
|
|||||
|
Capital
expenditures
|
$
|
6,451
|
$
|
4,506
|
$
|
11,020
|
$
|
11,129
|
|||||
|
Total
debt
|
$
|
51,190
|
$
|
54,250
|
|||||||||
|
Cash
on hand
|
$
|
9,262
|
$
|
5,772
|
|||||||||
|
Total
debt minus cash on hand
|
$
|
41,928
|
$
|
48,478
|
|||||||||
|
Backlog
|
$
|
239,939
|
$
|
191,174
|
|||||||||