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 4, 2010
(Date of earliest event reported: November 4,
2010)
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))
Item
2.02. Results of Operations and Financial Condition.
On
November 4, 2010, RBC
Bearings Incorporated (the “Company”) issued a press release announcing its
financial results for the quarter ended October 2, 2010 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 4, 2010.
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 4, 2010
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RBC
BEARINGS INCORPORATED
|
||
|
By:
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/s/
Thomas J. Williams
|
|
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Name:
Thomas J. Williams
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||
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Title:
Corporate General Counsel &
Secretary
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||
Page
2
Press
release
RBC
Bearings Incorporated Announces Fiscal 2011 Second Quarter Results
Oxford,
CT – November 4, 2010 – 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 October 2, 2010.
Second Quarter
Highlights
|
|
Q2 Fiscal 2011
|
Q2 Fiscal 2010
|
Change
|
|||||||||||||||||||||
|
($ in millions)
|
GAAP
|
Adjusted (1)
|
GAAP
|
Adjusted (1)
|
GAAP
|
Adjusted (1)
|
||||||||||||||||||
|
Net
sales
|
$ | 83.1 | $ | 63.7 | 30.5 | % | ||||||||||||||||||
|
Gross
margin
|
$ | 27.2 | $ | 27.9 | $ | 19.1 | $ | 20.0 | 42.7 | % | 39.5 | % | ||||||||||||
|
Gross
margin %
|
32.8 | % | 33.5 | % | 30.0 | % | 31.4 | % | ||||||||||||||||
|
Operating
income
|
$ | 13.9 | $ | 14.6 | $ | 7.2 | $ | 8.5 | 91.9 | % | 71.9 | % | ||||||||||||
|
Net
income
|
$ | 8.6 | $ | 9.3 | $ | 4.4 | $ | 5.3 | 94.2 | % | 75.5 | % | ||||||||||||
|
Diluted
EPS
|
$ | 0.39 | $ | 0.42 | $ | 0.20 | $ | 0.24 | 95.0 | % | 75.0 | % | ||||||||||||
(1) Results
exclude items in reconciliation below.
Six Month
Highlights
|
|
Q2 Fiscal 2011
|
Q2 Fiscal 2010
|
Change
|
|||||||||||||||||||||
|
($ in millions)
|
GAAP
|
Adjusted (1)
|
GAAP
|
Adjusted (1)
|
GAAP
|
Adjusted (1)
|
||||||||||||||||||
|
Net
sales
|
$ | 165.5 | $ | 127.4 | 29.9 | % | ||||||||||||||||||
|
Gross
margin
|
$ | 53.5 | $ | 55.0 | $ | 39.0 | $ | 40.4 | 37.2 | % | 36.2 | % | ||||||||||||
|
Gross
margin %
|
32.3 | % | 33.2 | % | 30.6 | % | 31.7 | % | ||||||||||||||||
|
Operating
income
|
$ | 27.9 | $ | 28.5 | $ | 15.0 | $ | 17.0 | 86.0 | % | 67.9 | % | ||||||||||||
|
Net
income
|
$ | 17.6 | $ | 18.5 | $ | 9.5 | $ | 10.6 | 86.0 | % | 74.5 | % | ||||||||||||
|
Diluted
EPS
|
$ | 0.80 | $ | 0.84 | $ | 0.44 | $ | 0.49 | 81.8 | % | 71.4 | % | ||||||||||||
(1) Results
exclude items in reconciliation below.
“Our
second quarter results reflect continued improvements in our markets and
demonstrate the strength of our operations and the leverage built into our cost
base,” said Dr. Michael J. Hartnett, Chairman and Chief Executive Officer. “We
delivered significant margin expansion on an adjusted basis, improving gross
margins by 210 basis points and operating margins by 420 basis points, while
further strengthening our balance sheet to afford ourselves the flexibility to
participate most effectively in the recovery. We are particularly
encouraged by the continued strength of various industrial segments, including
the OEM and distribution markets, and we remain optimistic for continued revenue
gains through fiscal 2011.”
Second Quarter
Results
Net sales
for the second quarter of fiscal 2011 were $83.1 million, an increase of 30.5%
from $63.7 million in the second quarter of fiscal 2010. The increase of 30.5%
was driven by an increase of 85.3% in our industrial business offset by a 2.7%
decrease in net sales in our aerospace and defense business. Gross
margin for the second quarter was $27.2 million compared to $19.1 million for
the same period last year. Gross margin as a percentage of net sales was 32.8%
in the second quarter of fiscal 2011 compared to 30.0% for the same period last
year. The increase in gross margin percentage was mainly driven by the current
recovery in our industrial business offset by costs associated with our
expansion into large bearing products. Gross margin as a percentage
of net sales, excluding $0.6 million of large bearing expansion costs, was 33.5%
compared to 31.4% for the same adjusted period last year.
Operating
income increased 91.9% to $13.9 million for the second quarter of fiscal 2011
compared to $7.2 million for the same period last year. As a percentage of net
sales, operating income was 16.7% compared to 11.4% for the same period last
year. Operating income excluding costs associated with the expansion into new
large bearing products and restructuring and moving costs was $14.6 million, an
increase of 71.9% compared to adjusted operating income for the same period last
year. As a percentage of net sales, operating income, excluding these
charges, was 17.5% compared to 13.3% for the same adjusted period last
year.
Interest
expense, net for the second quarter of fiscal 2011 was $0.4 million compared to
$0.5 million for the same period last year.
Other
non-operating expense was $0.4 million for the second quarter of fiscal
2011. This was mainly comprised of foreign exchange
losses.
For the
second quarter of fiscal 2011, the Company reported net income of $8.6 million
compared to net income of $4.4 million in the same period last
year. Excluding the after-tax costs associated with the expansion
into large bearing products, restructuring and moving costs, and the foreign
exchange loss, net income increased 75.5% to $9.3 million compared to $5.3
million for the same adjusted period last year.
Six Month
Results
Net sales
for the six month period ended October 2, 2010 were $165.5 million, an increase
of 29.9% from $127.4 million for the six month period ended September 26, 2009.
Gross margin for the six month period ended October 2, 2010 was $53.5 million
compared to $39.0 million for the same period last year. Gross margin as a
percentage of net sales was 32.3% for the six month period of fiscal 2011
compared to 30.6% for the same period last year. The increase in gross margin
percentage was mainly driven by the current recovery in our industrial business
offset by costs associated with the Company’s expansion into large bearing
products. Gross margin as a percentage of net sales, excluding $1.5 million of
large bearing costs, was 33.2% compared to 31.7% for the same adjusted period
last year.
For the
six month period ended October 2, 2010, the Company reported operating income of
$27.9 million compared to $15.0 million for the same period last
year. Operating income excluding costs associated with the expansion
into large bearing products, restructuring and moving costs, and a net gain on
disposition or sale of assets was $28.5 million for the six month period ended
October 2, 2010 compared to $17.0 million for the same adjusted period last
year. Operating income as a percentage of net sales excluding these
charges was 17.2% for the six month period ended October 2, 2010 compared to
13.3% for the same adjusted period last year.
Interest
expense, net for the six month period ended October 2, 2010 was $0.8 million, a
decrease of $0.1 million, from $0.9 million for the same period last
year.
Other
non-operating expense was a loss of $0.8 million for the six month period ended
October 2, 2010. This was mainly comprised of foreign exchange
losses.
Net
income for the six month period ended October 2, 2010 was $17.6 million compared
to net income of $9.5 million for the same period last
year. Excluding the after-tax costs associated with the expansion
into large bearing products, restructuring and moving costs, the foreign
exchange loss, and a net gain on disposition or sale of assets, net income was
$18.5 million compared to $10.6 million for the same adjusted period last
year.
Live
Webcast
RBC
Bearings Incorporated will host a webcast at 11:00 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 800-638-5495 (international
callers dial 617-614-3496) and enter conference ID # 75928233. An
audio replay of the call will be available from 2:00 p.m. ET on Thursday,
November 4th until 11:59 p.m. ET on Thursday, November 11th. The replay can be
accessed by dialing 888-286-8010 (international callers dial 617-801-6888) and
entering conference call ID # 43579669. 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 1,874 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
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
|
Six Months Ended
|
|||||||||||||||
|
October 2,
|
September 26,
|
October 2,
|
September 26,
|
|||||||||||||
|
2010
|
2009
|
2010
|
2009
|
|||||||||||||
|
Net
sales
|
$ | 83,095 | $ | 63,657 | $ | 165,469 | $ | 127,389 | ||||||||
|
Cost
of sales
|
55,857 | 44,564 | 111,978 | 88,392 | ||||||||||||
|
Gross
margin
|
27,238 | 19,093 | 53,491 | 38,997 | ||||||||||||
|
Operating
expenses:
|
||||||||||||||||
|
Selling,
general and administrative
|
12,988 | 11,132 | 25,480 | 22,751 | ||||||||||||
|
Other,
net
|
362 | 724 | 76 | 1,230 | ||||||||||||
|
Total
operating expenses
|
13,350 | 11,856 | 25,556 | 23,981 | ||||||||||||
|
Operating
income
|
13,888 | 7,237 | 27,935 | 15,016 | ||||||||||||
|
Interest
expense, net
|
398 | 460 | 790 | 929 | ||||||||||||
|
Other
non-operating expense (income)
|
447 | 85 | 817 | (240 | ) | |||||||||||
|
Income
before income taxes
|
13,043 | 6,692 | 26,328 | 14,327 | ||||||||||||
|
Provision
for income taxes
|
4,489 | 2,288 | 8,713 | 4,856 | ||||||||||||
|
Net
income
|
$ | 8,554 | $ | 4,404 | $ | 17,615 | $ | 9,471 | ||||||||
|
Net
income per common share:
|
||||||||||||||||
|
Basic
|
$ | 0.40 | $ | 0.20 | $ | 0.81 | $ | 0.44 | ||||||||
|
Diluted
|
$ | 0.39 | $ | 0.20 | $ | 0.80 | $ | 0.44 | ||||||||
|
Weighted
average common shares:
|
||||||||||||||||
|
Basic
|
21,626,198 | 21,591,779 | 21,617,923 | 21,587,193 | ||||||||||||
|
Diluted
|
21,991,668 | 21,746,552 | 21,984,410 | 21,718,805 | ||||||||||||
RBC
Bearings Incorporated
Consolidated
Statements of Operations
(dollars
in thousands, except share and per share data)
(Unaudited)
|
Three
Months Ended
|
Six
Months Ended
|
|||||||||||||||
| Reconciliation of Reported Gross Margin to Adjusted Gross |
October
2,
|
September 26,
|
October
2,
|
September 26,
|
||||||||||||
|
Margin:
|
2010
|
2009
|
2010
|
2009
|
||||||||||||
|
Reported
gross margin
|
$ | 27,238 | $ | 19,093 | $ | 53,491 | $ | 38,997 | ||||||||
|
Large
bearing expansion costs
|
638 | 892 | 1,510 | 1,374 | ||||||||||||
|
Adjusted
gross margin
|
$ | 27,876 | $ | 19,985 | $ | 55,001 | $ | 40,371 | ||||||||
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
| Reconciliation of Reported Operating Income to Adjusted |
October 2,
|
September 26,
|
October 2,
|
September 26,
|
||||||||||||
|
Operating Income:
|
2010
|
2009
|
2010
|
2009
|
||||||||||||
|
Reported
operating income
|
$ | 13,888 | $ | 7,237 | $ | 27,935 | $ | 15,016 | ||||||||
|
Large
bearing expansion costs
|
638 | 892 | 1,510 | 1,374 | ||||||||||||
|
Restructuring
and moving costs
|
52 | 354 | 120 | 562 | ||||||||||||
|
(Gain)
loss on disposition or sale of assets
|
- | - | (1,066 | ) | 19 | |||||||||||
|
Adjusted
operating income
|
$ | 14,578 | $ | 8,483 | $ | 28,499 | $ | 16,971 | ||||||||
|
Reconciliation of Reported Net Income and
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
Net Income Per Common Share to Adjusted Net
|
October 2,
|
September 26,
|
October 2,
|
September 26,
|
||||||||||||
|
Income and Adjusted Net Income Per Common Share:
|
2010
|
2009
|
2010
|
2009
|
||||||||||||
|
Reported
net income
|
$ | 8,554 | $ | 4,404 | $ | 17,615 | $ | 9,471 | ||||||||
|
Large
bearing expansion costs (1)
|
418 | 587 | 1,010 | 908 | ||||||||||||
|
Restructuring
and moving costs (1)
|
34 | 233 | 80 | 372 | ||||||||||||
|
(Gain)
loss on disposition or sale of assets (1)
|
- | - | (713 | ) | 13 | |||||||||||
|
Foreign
exchange loss (gain) (1)
|
260 | 56 | 513 | (159 | ) | |||||||||||
|
Adjusted
net income
|
$ | 9,266 | $ | 5,280 | $ | 18,505 | $ | 10,605 | ||||||||
|
(1)
Item was tax effected at the effective tax rate.
|
||||||||||||||||
|
Adjusted
net income per common share:
|
||||||||||||||||
|
Basic
|
$ | 0.43 | $ | 0.24 | $ | 0.86 | $ | 0.49 | ||||||||
|
Diluted
|
$ | 0.42 | $ | 0.24 | $ | 0.84 | $ | 0.49 | ||||||||
|
Adjusted
weighted average common shares:
|
||||||||||||||||
|
Basic
|
21,626,198 | 21,591,779 | 21,617,923 | 21,587,193 | ||||||||||||
|
Diluted
|
21,991,668 | 21,746,552 | 21,984,410 | 21,718,805 | ||||||||||||
RBC
Bearings Incorporated
Consolidated
Statements of Operations
(dollars
in thousands, except share and per share data)
(Unaudited)
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
October 2,
|
September 26,
|
October 2,
|
September 26,
|
|||||||||||||
|
Segment
Data, Net External Sales:
|
2010
|
2009
|
2010
|
2009
|
||||||||||||
|
Roller
bearings segment
|
$ | 24,864 | $ | 17,311 | $ | 48,292 | $ | 32,879 | ||||||||
|
Plain
bearings segment
|
40,935 | 30,262 | 83,596 | 61,262 | ||||||||||||
|
Ball
bearings segment
|
10,939 | 11,370 | 20,976 | 23,612 | ||||||||||||
|
Other
segment
|
6,357 | 4,714 | 12,605 | 9,636 | ||||||||||||
| $ | 83,095 | $ | 63,657 | $ | 165,469 | $ | 127,389 | |||||||||
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
|
October 2,
|
September 26,
|
October 2,
|
September 26,
|
|||||||||||||
|
Selected Financial Data:
|
2010
|
2009
|
2010
|
2009
|
||||||||||||
|
Depreciation
and amortization
|
$ | 3,275 | $ | 2,976 | $ | 6,483 | $ | 5,867 | ||||||||
|
Incentive
stock compensation expense
|
$ | 1,013 | $ | 707 | $ | 2,023 | $ | 1,453 | ||||||||
|
Cash
provided by operating activities
|
$ | 9,740 | $ | 4,610 | $ | 25,652 | $ | 21,379 | ||||||||
|
Capital
expenditures
|
$ | 2,534 | $ | 1,751 | $ | 4,586 | $ | 6,021 | ||||||||
|
Total
debt
|
$ | 31,414 | $ | 63,005 | ||||||||||||
|
Cash
and short-term investments
|
$ | 47,386 | $ | 41,620 | ||||||||||||
|
Backlog
|
$ | 175,250 | $ | 160,530 | ||||||||||||