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: February 5, 2009
(Date of earliest event reported: February 5,
2009)
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):
[ ]
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
February 5, 2009 RBC Bearings
Incorporated (the “Company”) issued a press release announcing its financial
results for the quarter ended December 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
February 5, 2009.
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:
February 5, 2009
|
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 2009 Third Quarter Results
Oxford,
CT – February 5, 2009 – 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 third quarter ended December 27, 2008.
Third Quarter
Highlights
|
|
Q3
Fiscal 2009
|
Q3
Fiscal 2008
|
Change
|
|||||||||||||||||||||
|
($
in millions)
|
GAAP
|
Adjusted
(1)
|
GAAP
|
Adjusted
(1)
|
GAAP
|
Adjusted
(1)
|
||||||||||||||||||
|
Net
sales
|
$ | 85.3 | $ | 80.4 | 6.1 | % | ||||||||||||||||||
|
Gross
margin
|
$ | 28.5 | $ | 29.3 | $ | 27.6 | $ | 27.6 | 3.4 | % | 6.5 | % | ||||||||||||
|
Gross
margin %
|
33.4 | % | 34.4 | % | 34.3 | % | 34.3 | % | ||||||||||||||||
|
Operating
income
|
$ | 12.8 | $ | 14.5 | $ | 15.1 | $ | 15.3 | -15.3 | % | -5.1 | % | ||||||||||||
|
Net
income
|
$ | 7.7 | $ | 9.0 | $ | 9.6 | $ | 9.5 | -19.6 | % | -5.9 | % | ||||||||||||
|
Diluted
EPS
|
$ | 0.35 | $ | 0.41 | $ | 0.44 | $ | 0.44 | -20.5 | % | -6.8 | % | ||||||||||||
|
(1) Results
exclude items in reconciliation below.
|
||||||||||||||||||||||||
Nine Month
Highlights
|
|
Q3
Fiscal 2009
|
Q3
Fiscal 2008
|
Change
|
|||||||||||||||||||||
|
($
in millions)
|
GAAP
|
Adjusted
(1)
|
GAAP
|
Adjusted
(1)
|
GAAP
|
Adjusted
(1)
|
||||||||||||||||||
|
Net
sales
|
$ | 272.0 | $ | 238.5 | 14.0 | % | ||||||||||||||||||
|
Gross
margin
|
$ | 89.3 | $ | 91.1 | $ | 81.2 | $ | 81.2 | 9.9 | % | 12.2 | % | ||||||||||||
|
Gross
margin %
|
32.8 | % | 33.5 | % | 34.1 | % | 34.1 | % | ||||||||||||||||
|
Operating
income
|
$ | 45.0 | $ | 48.6 | $ | 44.9 | $ | 45.6 | 0.3 | % | 6.7 | % | ||||||||||||
|
Net
income
|
$ | 28.0 | $ | 30.9 | $ | 28.2 | $ | 28.4 | -0.7 | % | 8.7 | % | ||||||||||||
|
Diluted
EPS
|
$ | 1.29 | $ | 1.42 | $ | 1.29 | $ | 1.30 | 0.0 | % | 9.2 | % | ||||||||||||
|
(1) Results
exclude items in reconciliation below.
|
||||||||||||||||||||||||
“Our
third quarter certainly presented us with more challenges than we expected at
the beginning of the period,” said Dr. Michael J. Hartnett, Chairman and Chief
Executive Officer. “The length of the strike at Boeing combined with
the global financial crisis created increasing headwinds as the quarter
aged. Given these external events, we are satisfied with the
performance the Company demonstrated.”
Third Quarter
Results
Net sales
for the third quarter of fiscal 2009 were $85.3 million, an increase of 6.1%
from $80.4 million in the third quarter of fiscal 2008. Gross margin for the
third quarter rose 3.4% to $28.5 million compared to $27.6 million for the same
period last year. Gross margin as a percentage of net sales was 33.4% in the
third quarter of fiscal 2009 compared to 34.3% 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 $0.8
million of start-up costs, was 34.4% compared to 34.3% for the same period last
year.
Operating
income decreased 15.3% to $12.8 million for the third quarter of fiscal 2009
compared to $15.1 million for the same period last year. As a percentage of net
sales, operating income was 15.0% compared to 18.8% 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 $14.5 million, a decrease of 5.1% compared to
adjusted operating income for the same period last year. As a
percentage of net sales, operating income, excluding these charges, was 17.0%
compared to 19.0% for the same adjusted period last year.
Interest
expense, net for the third quarter of fiscal 2009 was $0.7 million, compared to
$0.8 million for the same period last year.
Other
non-operating expense was $0.3 million for the third quarter of fiscal
2009. This was mainly comprised of $0.4 million of income from the
CDSOA payment offset by $0.6 million of foreign exchange losses on British Pound
Sterling inter-company loans to our Phoenix division in the United
Kingdom. Since these loans are not considered long-term in nature,
the resulting translation losses are included in net income.
For the
third quarter of fiscal 2009, the Company reported net income of $7.7 million
compared to net income of $9.6 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,
disposal of fixed assets, exclusion of the CDSOA payment and the foreign
exchange loss, net income decreased 5.9% to $9.0 million compared to $9.5
million for the same adjusted period last year.
Nine Month
Results
Net sales
for the nine month period ended December 27, 2008 were $272.0 million, an
increase of 14.0% from $238.5 million for the nine month period ended December
29, 2007. Gross margin for the nine month period ended December 27, 2008 rose
9.9% to $89.3 million compared to $81.2 million for the same period last year.
Gross margin as a percentage of net sales was 32.8% for the nine month period of
fiscal 2009 compared to 34.1% 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 $1.9 million
of start-up costs, was 33.5% compared to 34.1% for the same period last
year.
For the
nine month period ended December 27, 2008, the Company reported operating income
of $45.0 million compared to $44.9 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 6.7% to $48.6 million for the nine month
period ended December 27, 2008 compared to $45.6 million for the same adjusted
period last year. Operating income as a percentage of sales excluding
these charges was 17.9% for the first nine months of fiscal 2009 compared to
19.1% for the same adjusted period last year.
Interest
expense, net for the nine month period ended December 27, 2008 was $2.1 million,
a decrease of $0.6 million, from $2.7 million for the same period last
year.
Other
non-operating expense was $0.5 million for the nine month period ended December
27, 2008. This was mainly comprised of $0.4 million of income from
the CDSOA payment offset by $0.9 million of foreign exchange losses on British
Pound Sterling inter-company loans to our Phoenix division in the United
Kingdom. Since these loans are not considered long-term in nature,
the resulting translation losses are included in net income.
Net
income for the nine month period ended December 27, 2008 was $28.0 million
compared to net income of $28.2 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, the loss on early extinguishment of debt, exclusion of
the CDSOA payment and the foreign exchange loss, net income increased 8.7% to
$30.9 million compared to $28.4 million for the same adjusted period last
year.
Plant Move and
Consolidation
The
Company completed the consolidation and rationalization of its South Carolina
operations and incurred a final charge of $0.8 million in the third quarter.
This consolidation has resulted in a total charge of $1.4 million in fiscal year
2009.
CDSOA
Payment
In
December 2008, the Company received approximately $0.4 million in payments under
the U.S. Continued Dumping and Subsidy Offset Act “CDSOA” compared to $0.3
million received in December 2007. The CDSOA distributes antidumping
duties paid by overseas companies to qualified domestic firms hurt by unfair
trade. This payment has been classified below Operating income in
“Other non-operating expense (income)” on the Consolidated Statement of
Operations.
Outlook
“We
believe the continuous introduction of new products during this year and our
sustained efforts in product development will broaden our offering in the coming
years. Our backlog continues to hold and we have made the right decisions to
strengthen our balance sheet while investing for long-term growth. The
visibility we are afforded due to the recurring revenue of our business gives us
confidence in our ability to perform despite these difficult economic times,”
concluded Dr. Hartnett.
Based on
current market conditions and assessments, the Company expects financial
performance in its fourth quarter of fiscal 2009 to be as follows:
Net sales in the range of $84.0 - $87.0
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 877-718-5107 (international
callers dial 719-325-4796). An audio replay of the call will be
available from 1:00 p.m. ET on Thursday, February 5th until 11:59 p.m. ET on
Thursday, February 19th. The replay can be accessed by dialing 888-203-1112
(international callers dial 719-457-0820) and entering conference call ID #
2180044. 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 2,133 people and operates 22 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 and most recent quarterly reports filed on Form 10-Q. 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
Michael
Cummings
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
|
Nine
Months Ended
|
|||||||||||||||
|
December
27,
|
December
29,
|
December
27,
|
December
29,
|
|||||||||||||
|
2008
|
2007
|
2008
|
2007
|
|||||||||||||
|
Net
sales
|
$ | 85,281 | $ | 80,407 | $ | 271,955 | $ | 238,462 | ||||||||
|
Cost
of sales
|
56,779 | 52,853 | 182,681 | 157,226 | ||||||||||||
|
Gross
margin
|
28,502 | 27,554 | 89,274 | 81,236 | ||||||||||||
|
Operating
expenses:
|
||||||||||||||||
|
Selling,
general and administrative
|
14,403 | 12,042 | 41,482 | 35,232 | ||||||||||||
|
Other,
net
|
1,304 | 401 | 2,783 | 1,117 | ||||||||||||
|
Total
operating expenses
|
15,707 | 12,443 | 44,265 | 36,349 | ||||||||||||
|
Operating
income
|
12,795 | 15,111 | 45,009 | 44,887 | ||||||||||||
|
Interest
expense, net
|
749 | 849 | 2,080 | 2,748 | ||||||||||||
|
Loss
on early extinguishment of debt
|
- | - | 319 | 27 | ||||||||||||
|
Other
non-operating expense (income)
|
325 | (360 | ) | 491 | (712 | ) | ||||||||||
|
Income
before income taxes
|
11,721 | 14,622 | 42,119 | 42,824 | ||||||||||||
|
Provision
for income taxes
|
4,021 | 5,041 | 14,148 | 14,669 | ||||||||||||
|
Net
income
|
$ | 7,700 | $ | 9,581 | $ | 27,971 | $ | 28,155 | ||||||||
|
Net
income per common share:
|
||||||||||||||||
|
Basic
|
$ | 0.36 | $ | 0.45 | $ | 1.30 | $ | 1.31 | ||||||||
|
Diluted
|
$ | 0.35 | $ | 0.44 | $ | 1.29 | $ | 1.29 | ||||||||
|
Weighted
average common shares:
|
||||||||||||||||
|
Basic
|
21,575,756 | 21,458,764 | 21,568,227 | 21,422,581 | ||||||||||||
|
Diluted
|
21,745,996 | 21,833,870 | 21,763,105 | 21,811,793 | ||||||||||||
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
|
December
27,
|
December
29,
|
December
27,
|
December
29,
|
|||||||||||||
|
Reconciliation
of Reported Operating Income to
|
2008
|
2007
|
2008
|
2007
|
||||||||||||
|
Adjusted
Operating Income:
|
||||||||||||||||
|
Reported
operating income
|
$ | 12,795 | $ | 15,111 | $ | 45,009 | $ | 44,887 | ||||||||
|
Large
bearing start-up costs
|
832 | - | 1,875 | - | ||||||||||||
|
Facility
moving and consolidation expenses
|
581 | 111 | 1,068 | 589 | ||||||||||||
|
Disposal
of fixed assets
|
276 | 42 | 676 | 105 | ||||||||||||
|
Adjusted
operating income
|
$ | 14,484 | $ | 15,264 | $ | 48,628 | $ | 45,581 | ||||||||
|
Reconciliation
of Reported Net Income and
|
Three
Months Ended
|
Nine
Months Ended
|
||||||||||||||
|
Net
Income Per Common Share to Adjusted Net
|
December
27,
|
December
29,
|
December
27,
|
December
29,
|
||||||||||||
|
Income
and Adjusted Net Income Per Common Share:
|
2008
|
2007
|
2008
|
2007
|
||||||||||||
|
Reported
net income
|
$ | 7,700 | $ | 9,581 | $ | 27,971 | $ | 28,155 | ||||||||
|
Large
bearing start-up costs (1)
|
547 | - | 1,245 | - | ||||||||||||
|
Facility
moving and consolidation expenses (1)
|
382 | 73 | 709 | 387 | ||||||||||||
|
Disposal
of fixed assets (1)
|
181 | 28 | 449 | 69 | ||||||||||||
|
Loss
on early extinguishment of debt (1)
|
- | - | 212 | 18 | ||||||||||||
|
CDSOA
payment (1)
|
(248 | ) | (167 | ) | (250 | ) | (168 | ) | ||||||||
|
Foreign
exchange loss on inter-company loans (1)
|
420 | 32 | 585 | (16 | ) | |||||||||||
|
Adjusted
net income
|
$ | 8,982 | $ | 9,547 | $ | 30,921 | $ | 28,445 | ||||||||
|
(1)
Item was tax effected at the effective tax rate.
|
||||||||||||||||
|
Adjusted
net income per common share:
|
||||||||||||||||
|
Basic
|
$ | 0.42 | $ | 0.44 | $ | 1.43 | $ | 1.33 | ||||||||
|
Diluted
|
$ | 0.41 | $ | 0.44 | $ | 1.42 | $ | 1.30 | ||||||||
|
Adjusted
weighted average common shares:
|
||||||||||||||||
|
Basic
|
21,575,756 | 21,458,764 | 21,568,227 | 21,422,581 | ||||||||||||
|
Diluted
|
21,745,996 | 21,833,870 | 21,763,105 | 21,811,793 | ||||||||||||
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
|
December
27,
|
December
29,
|
December
27,
|
December
29,
|
|||||||||||||
|
Segment
Data, Net External Sales:
|
2008
|
2007
|
2008
|
2007
|
||||||||||||
|
Roller
bearings segment
|
$ | 20,969 | $ | 22,832 | $ | 71,592 | $ | 69,582 | ||||||||
|
Plain
bearings segment
|
39,898 | 38,653 | 126,794 | 112,548 | ||||||||||||
|
Ball
bearings segment
|
16,157 | 13,004 | 47,758 | 40,257 | ||||||||||||
|
Other
segment
|
8,257 | 5,918 | 25,811 | 16,075 | ||||||||||||
| $ | 85,281 | $ | 80,407 | $ | 271,955 | $ | 238,462 | |||||||||
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||
|
December
27,
|
December
29,
|
December
27,
|
December
29,
|
|||||||||||||
|
Selected
Financial Data:
|
2008
|
2007
|
2008
|
2007
|
||||||||||||
|
Depreciation
and amortization
|
$ | 3,130 | $ | 2,670 | $ | 9,546 | $ | 7,616 | ||||||||
|
Cash
provided by operating activities
|
$ | 8,622 | $ | 1,016 | $ | 32,565 | $ | 24,606 | ||||||||
|
Capital
expenditures
|
$ | 6,707 | $ | 3,159 | $ | 17,727 | $ | 14,288 | ||||||||
|
Total
debt
|
$ | 54,190 | $ | 51,250 | ||||||||||||
|
Cash
on hand
|
$ | 15,098 | $ | 9,194 | ||||||||||||
|
Total
debt minus cash on hand
|
$ | 39,092 | $ | 42,056 | ||||||||||||
|
Backlog
|
$ | 221,434 | $ | 192,663 | ||||||||||||