2007'05.07.Mon
Bucyrus International, Inc. Announces Closing and Financing of DBT GmbH Acquisition, Summary First Quarter 2007 Operating Results and Combined 2007 Financial Guidance
May 07, 2007
SOUTH MILWAUKEE, Wis., May 7 /Xinhua-PRNewswire/ --
Bucyrus International, Inc. (Nasdaq: BUCY), one of the
world's leading manufacturers of large-scale excavation
equipment used in surface mining, announced today that it
has completed its previously announced acquisition of DBT
GmbH, a subsidiary of RAG Coal International AG, and a
leading designer, manufacturer and marketer of high
technology system solutions for underground coal mining.
DBT is based in Lunen, Germany. Bucyrus also announced its
summary unaudited results for the three months ended March
31, 2007, combined Bucyrus/DBT sales and EBITDA guidance
for 2007 and the terms of its financing of the DBT
acquisition.
DBT Acquisition Closing
Bucyrus, through its acquisition subsidiary, DBT
Holdings GmbH, acquired DBT for $710 million in cash,
subject to certain closing adjustments, and 471,476 shares
of Bucyrus' common stock with a market value of $21 million
at the time of announcement of the acquisition.
Timothy W. Sullivan, president and chief executive
officer of Bucyrus, said "The DBT acquisition
represents an important event in the development of our
company. We believe our entry into the underground mining
equipment industry will enhance our ability to sell
original equipment and aftermarket support to a larger
segment of the global mining equipment market, and we are
very pleased to add DBT's internationally recognized brand
and leading market position to our product
portfolio."
Bucyrus First Quarter Operating Results
-- Q1 Sales Increased 14.9%, with Original Equipment
Sales
Increase of 46.6%
-- Q1 Gross Margin Increased to 27.4%
-- Q1 Operating Earnings Increased 21.1%
-- Q1 Basic EPS Increased 21.3%
Sales for the first quarter of 2007 were $190.4
million, an increase of 14.9% from $165.7 million for the
first quarter of 2006. Original equipment sales for the
first quarter of 2007 were $78.4 million, an increase of
$24.9 million, or 46.6%, from $53.5 million for the first
quarter of 2006. Aftermarket parts and service sales for
the first quarter of 2007 were $112.0 million, a decrease
of $0.2 million from $112.2 million for the first quarter
of 2006. Original equipment sales were 41.2% of sales for
the first quarter of 2007 compared to 32.3% for the first
quarter of 2006. The increase in original equipment sales
highlights the ongoing global demand for Bucyrus' products
and services, which is being driven by customer
expectations of sustained strength in the coal, copper, oil
sands and iron ore markets, ongoing and rapid
industrialization in parts of the developing world, demand
for minerals in the developed world and the rising cost of
non-coal energy sources.
Gross profit for the first quarter of 2007 was $52.1
million, or 27.4% of sales, compared with $40.9 million, or
24.7% of sales, for the first quarter of 2006. The increase
in gross profit was primarily due to increased original
equipment sales as well as improved gross margins on both
original equipment and aftermarket parts and services.
Gross margin increased as the increasing price of steel and
other raw materials was more than offset by the higher
selling prices of Bucyrus' products. Gross profit for the
first quarter of 2007 and 2006 was reduced by $0.5 million
and $0.3 million, respectively, of training costs for
employees hired at Bucyrus' new manufacturing facilities in
Milwaukee and South Milwaukee. Bucyrus is continuing to
hire and train new employees to support its increased
capacity initiatives. Gross profit for the first quarter
of 2007 and 2006 was also reduced by $1.3 million of
additional depreciation expense in each respective quarter
as a result of the purchase price allocation to plant and
original equipment in connection with prior acquisitions of
companies. Selling, general and administrative expenses for
the first quarter of 2007 were $21.2 million, or 11.1% of
sales, compared with $15.5 million, or 9.3% of sales, for
the first quarter of 2006. The dollar amount of selling,
general and administrative expenses in the first quarter of
2007 approximated the dollar amount of selling, general and
administrative expenses recognized in the fourth quarter of
2006.
Operating earnings were $27.9 million for the first
quarter of 2007, an increase of 21.1% from $23.0 million
for the first quarter of 2006. Operating earnings
increased primarily due to increased gross profit resulting
from increased sales volume.
Net earnings for the first quarter of 2007 were $17.9
million, or $0.57 per share, compared with $14.5 million,
or $0.47 per share, for the first quarter of 2006.
EBITDA for the first quarter of 2007 was $32.2 million,
an increase of 20.8% compared to $26.6 million for the first
quarter of 2006. As a percentage of sales, EBITDA for the
first quarter of 2007 was 16.9%, compared to 16.1% for the
first quarter of 2006. EBITDA is defined as net earnings
before interest income, interest expense, income taxes,
depreciation and amortization. EBITDA includes the impact
of non-cash stock compensation expense, severance expenses
and loss on sales of fixed assets as set forth in the
following tables. EBITDA is a measurement not recognized
in accordance with accounting principles generally accepted
in the United States of America (GAAP) and should not be
viewed as an alternative to GAAP measures of performance.
For a reconciliation of net earnings as shown in Bucyrus'
Unaudited Consolidated Statements of Earnings to EBITDA and
a reconciliation of net cash provided by operating
activities as shown in Bucyrus' Unaudited Consolidated
Statements of Cash Flows to EBITDA, see the tables below.
Capital expenditures for the first quarter of 2007 were
$14.8 million, which included $9.1 million related to
Bucyrus' previously announced ongoing expansion of its
South Milwaukee facilities. The remaining capital
expenditures consisted primarily of production machinery at
its main manufacturing facility.
As of March 31, 2007, total backlog was $937.6 million,
$647.9 million of which is expected to be recognized within
the subsequent 12 months. This represents a 4.8% and 9.1%
increase from the December 31, 2006 total backlog of $894.7
million and 12-month backlog of $593.8 million,
respectively. The backlog increase from December 31, 2006
was primarily due to an increase in original equipment
orders, which totaled $140.3 million for the first quarter
of 2007. Inquiries for new original equipment continue to
remain at a high level. Bucyrus also announced that it has
entered into a preliminary, non-binding letter of intent for
the potential sale of a dragline and related equipment with
a price in excess of $100.0 million to be delivered by
2010. Bucyrus hopes to execute the contract for this
potential dragline by early to mid-summer 2007. Since
Bucyrus recognizes revenue on a percentage of completion
basis, the impact of such order, if finalized, would be
recognized over a period of several years.
Combined 2007 Financial Guidance
After giving pro forma effect to the acquisition of DBT
as if it had occurred on January 1, 2007, Bucyrus estimates
full year 2007 pro forma combined sales to be in the range
of $1.9 to $2.0 billion and full year 2007 pro forma
combined EBITDA, without reduction for estimated non-cash
stock compensation expense or any customary purchase
accounting adjustments resulting from the DBT acquisition,
to be in the range of $255 to $275 million. In making
these estimates, Bucyrus is reaffirming its previously
announced stand-alone guidance range for 2007 sales of $875
to $925 million and EBITDA, without reduction for estimated
non-cash stock compensation expense, of $155 to $165
million. This financial guidance is based on Bucyrus'
current expectations for the results of operations of both
Bucyrus and DBT for the remainder of 2007, and takes into
account that DBT's 2006 results of operations benefited
significantly from an influx of new original equipment
product orders from underground mining customers that had
previously deferred their new underground equipment
purchases during the prolonged prior period of weaker coal
commodity prices. As a result, and in combination with the
recent softening of U.S. coal commodity prices and reduced
order intake levels at DBT for the first quarter of 2007
compared to the first quarter of 2006, Bucyrus believes
that it is likely that DBT's 2007 revenues will return to
more normalized levels than the unusually high levels
recognized in 2006. Bucyrus anticipated and took this
expected normalized level of results into account when it
valued and entered into the agreement to acquire DBT.
This financial guidance is an estimate as of today's
date and is based on assumptions believed to be reasonable
as of this date. Bucyrus is providing sales and EBITDA
guidance in this format due to the significant impact of
the DBT acquisition on its expected 2007 results of
operations, and it does not necessarily intend to regularly
issue guidance in this format in the future. Bucyrus
expressly disclaims any current intention to update or
revise this guidance, whether as a result of new
information, future events or otherwise. For a description
of some of the factors that could cause Bucyrus' actual
results to differ materially from the guidance reflected
above, see "Forward-Looking Statements and Cautionary
Factors" below. There can be no assurance that
Bucyrus will achieve its financial guidance.
DBT Acquisition Financing
In connection with and to initially fund the DBT
acquisition and to refinance certain other indebtedness,
Bucyrus entered into new credit facilities totaling $1.225
billion, consisting of a $400.0 million revolving credit
facility and an $825.0 million term loan facility.
Bucyrus also announced today that it is filing a
prospectus supplement with the Securities and Exchange
Commission relating to an underwritten public offering of
its common stock expected to raise approximately $300.0
million in gross proceeds, without taking into account any
underwriting discounts and commissions or offering expenses
or the exercise of any option granted to the underwriters to
purchase additional shares. The offering, and the amount
expected to be raised, will be subject to prevailing market
and other conditions, and is being made pursuant to an
automatic shelf registration statement that Bucyrus filed
with the Securities and Exchange Commission in June 2006.
Bucyrus intends to use the net proceeds from this equity
offering to repay a portion of its new term loan facility
used to initially finance the DBT acquisition.
Conference Call
Bucyrus will hold a telephone conference call
pertaining to this news release at 9:00 a.m. Eastern Time
(8:00 a.m. Central Time) on Monday, May 7, 2007.
Interested parties should call (866) 356-4123 ((617)
597-5393 for international callers), participant passcode
71368341. A replay of the call will be available until May
21, 2007 at (888) 286-8010 ((617) 801-6888 internationally),
passcode 85432316. The conference call will also be
available as a webcast. The webcast can be accessed
through the link provided on the Investor Relations page of
Bucyrus' website at http://www.bucyrus.com and will be
available until May 21, 2007.
Forward-Looking Statements and Cautionary Factors
This press release contains statements that constitute
"forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements may be identified by the
use of predictive, future tense or forward-looking
terminology, such as "believes,"
"anticipates," "expects,"
"estimates," "intends,"
"may," "will" or similar terms. The
2007 sales and EBITDA guidance provided under the caption
"Combined 2007 Financial Guidance" in this press
release are "forward-looking statements." You
are cautioned that any such forward-looking statements are
not guarantees of future performance and involve
significant risks and uncertainties, and that actual
results may differ materially from those contained in the
forward-looking statements as a result of various factors,
some of which are unknown. The factors that could cause
actual results to differ materially from those anticipated
in such forward-looking statements and could adversely
affect our actual results of operations and financial
condition include, without limitation:
-- disruption of our plant operations due to equipment
failures, natural disasters or other reasons;
-- our ability to attract and retain skilled labor;
-- our production capacity;
-- our ability to purchase component parts or raw
materials
from key suppliers at acceptable prices and/or on
the
required time schedule;
-- the cyclical nature of the sale of original
equipment due
to fluctuations in market prices for coal, copper,
oil,
iron ore and other minerals, changes in general
economic
conditions, interest rates, customers' replacement
or
repair cycles, consolidation in the mining industry
and
competitive pressures;
-- the loss of key customers or key members of
management;
-- the risks and uncertainties of doing business in
foreign
countries, including emerging markets, and foreign
currency risks;
-- our ability to continue to offer products
containing
innovative technology that meets the needs of our
customers;
-- costs and risks associated with regulatory
compliance and
changing regulations affecting the mining industry
and/or
electric utilities;
-- product liability, environmental and other
potential
litigation;
-- work stoppages at our company, our customers,
suppliers
or providers of transportation;
-- our ability to satisfy under-funded pension
obligations;
-- our ability to effectively and efficiently integrate
the
operations of DBT and to realize expected levels of
sales
and profit from this acquisition;
-- potential risks, material weaknesses in financial
reporting and liabilities of DBT unknown to us;
-- our dependence on the commodity price of coal and
other
conditions in the coal markets;
-- our reliance on significant customers;
-- our experience in the underground mining business,
which
is less than some of our competitors; and
-- our increased levels of debt and debt service
obligations
relating to our acquisition of DBT.
The foregoing factors do not constitute an exhaustive
list of factors that could cause actual results to differ
materially from those anticipated in forward-looking
statements, and should be read in conjunction with the
other cautionary statements and risk factors included in
our 2006 Annual Report to Stockholders and Annual Report on
Form 10-K filed with the Securities and Exchange Commission
on March 1, 2007, our prospectus supplement being filed
with the Securities and Exchange Commission and other
cautionary statements described in our other reports filed
with the Securities and Exchange Commission. All
forward-looking statements attributable to us are expressly
qualified in their entirety by the foregoing cautionary
statements. We undertake no obligation to publicly update
or revise any forward-looking statements, whether as a
result of new information, future events or otherwise.
For
the three months
ended March 31,
Dollars in thousands, except per share amounts 2007
2006
Consolidated Statements of Earnings
Sales $
190,361 $ 165,653
Cost of products sold
138,283 124,780
Gross profit
52,078 40,873
Selling, general and administrative expenses
21,194 15,460
Research and development expenses
2,548 1,922
Amortization of intangible assets
446 452
Operating earnings
27,890 23,039
Interest expense
1,449 645
Other (income) expense - net
(23) 122
Earnings before income taxes
26,464 22,272
Income tax expense
8,601 7,750
Net earnings
$17,863 $14,522
Net earnings per share:
Basic:
Net earnings per share
$.57 $.47
Weighted average shares
31,330,272 31,191,780
Diluted:
Net earnings per share
$.57 $.46
Weighted average shares
31,607,977 31,526,843
Other Financial Data
EBITDA (1) $
32,160 $ 26,616
Non-cash stock compensation expense (2)
1,692 578
Severance expenses (3)
473 272
Loss on sales of fixed assets (4)
95 42
$
2,260 $ 892
(1) EBITDA is defined as net earnings before interest
income, interest expense, income tax expense, depreciation
and amortization. EBITDA is presented because (i)
management uses EBITDA to measure the company's liquidity
and financial performance and (ii) management believes
EBITDA is frequently used by securities analysts, investors
and other interested parties in evaluating the performance
and enterprise value of companies in general, and in
evaluating the liquidity of companies with significant debt
service obligations and their ability to service their
indebtedness. The EBITDA calculation is not an alternative
to operating earnings under accounting principles generally
accepted in the United States of America, or GAAP, as an
indicator of operating performance or of cash flows as a
measure of liquidity. Additionally, EBITDA is not intended
to be a measure of free cash flow for management's
discretionary use, as it does not consider certain cash
requirements such as interest payments, tax payments and
debt service requirements. Because not all companies use
identical calculations, this presentation of EBITDA may not
be comparable to other similarly titled measures of other
companies. The following table reconciles net earnings and
net cash provided by operating activities.
(2) Reflects non-cash stock compensation expense
related to Bucyrus' equity incentive plans.
(3) Reflects severance expenses for personnel changes
in the ordinary course.
(4) Reflects losses on the sale of fixed assets in the
ordinary course.
For
the three months
ended March 31,
Dollars in thousands 2007
2006
EBITDA Reconciliation
Net earnings
$17,863 $14,522
Interest income
(212) (114)
Interest expense
1,449 645
Income tax expense
8,601 7,750
Depreciation
3,748 3,107
Amortization
711 706
EBITDA
32,160 26,616
Changes in assets and liabilities
(15,057) 23,822
Non-cash stock compensation expense
1,692 578
Loss on sale of fixed assets
95 42
Interest income
212 114
Interest expense
(1,449) (645)
Income tax expense
(8,601) (7,750)
Net cash provided by operating activities
$9,052 $42,777
March
31, December 31,
Dollars in thousands 2007
2006
Consolidated Balance Sheets
Assets
Cash and cash equivalents
$13,285 $9,575
Receivables-net
154,401 162,535
Inventories
196,731 176,277
Deferred income taxes
12,912 11,725
Prepaid expenses and other
17,348 16,408
Total current assets
394,677 376,520
Goodwill
47,306 47,306
Intangible assets-net
27,642 28,097
Deferred income taxes
14,960 16,117
Other assets
7,069 7,523
Total other assets
96,977 99,043
Property, plant and equipment - net
136,097 125,149
Total assets
$627,751 $600,712
Liabilities and Common Stockholders' Investment
Accounts payable and accrued expenses
$116,746 $127,724
Liabilities to customers on uncompleted
contracts and warranties
36,227 32,233
Income taxes
15,073 9,978
Current maturities of long-term debt and
other short-term obligations
539 331
Total current liabilities
168,585 170,266
Postretirement benefits
17,675 17,313
Pension and other
33,766 34,871
Total other liabilities
51,441 52,184
Long-term debt
93,641 82,266
Common stockholders' investment
314,084 295,996
Total liabilities and common
stockholders' investment
$627,751 $600,712
Bucyrus has filed a registration statement (including a
prospectus) with the SEC for the offering to which this
communication relates. Before you invest, you should read
the prospectus in that registration statement and other
documents Bucyrus has filed with the SEC for more complete
information about Bucyrus and this offering. You may get
these documents for free by visiting EDGAR on the SEC Web
site at http://www.sec.gov . Alternatively, the issuer,
any underwriter or any dealer participating in the offering
will arrange to send you the prospectus if you request it by
calling toll-free (888) 603-5847.
For more information, please contact:
Kent Henschen, Director
Marketing and Corporate Communications
Bucyrus International, Inc.
Tel: +1-414-768-4626
PR
Post your Comment
広告
ブログ内検索
アーカイブ
カウンター