EnerSys Reports Earnings for Third Quarter FY 2005
READING, Pa., Feb 16, 2005 /PRNewswire-FirstCall via COMTEX/ -- EnerSys (NYSE: ENS), the world's largest manufacturer, marketer and distributor of industrial batteries, today announced net earnings for its third fiscal quarter of 2005 ending January 2, 2005 of $6,818,000, or $0.15 per share basic and $0.14 per share diluted, compared to a net loss of $10,400,000 and net loss available to common shareholders of $16,244,000 or $1.47 loss per share (basic and diluted) in the prior year's third fiscal quarter. In addition, EnerSys announced that it has reached an agreement in principle to acquire the motive power battery business of FIAMM. S.p.A. With revenues, primarily in Europe, of approximately $90 million (Euros 70 million), this will extend EnerSys' motive power battery leadership worldwide. Please see the press release regarding this acquisition for more information.
Giving effect to the EnerSys IPO as if it occurred at the beginning of the first quarter of both fiscal 2005 and 2004 and after excluding special charges, pro forma net earnings per share were $0.15 per share basic and $0.14 per share diluted in our fiscal 2005 third quarter and $0.22 per share (basic and diluted) in our fiscal 2004 third quarter, or a decrease of $0.07 basic and $0.08 diluted.
Net sales for our third quarter in fiscal 2005 were $273,707,000 compared to $253,296,000 in our prior year third quarter, or an increase of over 8%.
EnerSys' fiscal 2005 third quarter operating results for its reporting segments compared to the fiscal 2004 third quarter are as follows:
Reserve Power - Net sales increased 1% to $128,312,000, while
operating earnings decreased over 30% to $8,925,000 with margins
decreasing 320 bps to 6.9%. The net sales increase is reflective of
the previously announced temporary delay in defense shipments. The
reduction in operating earnings margins was primarily attributable to
the lower defense sales and the impact of manufacturing
inefficiencies, which was previously announced.
Motive Power - Net sales increased over 15% to $145,395,000, while
operating earnings decreased over 3% to $7,982,000 with margins
decreasing 110 bps to 5.5%. The decrease in operating earnings
margins was primarily attributable to the previously mentioned
manufacturing inefficiencies and higher commodity costs.
For the fiscal nine month period ending January 2, 2005, net sales were $798,281,000 compared to $693,700,000 for the same period in the prior year or an increase of over 15%, with pro forma diluted net earnings per share of $0.60 ($0.42 diluted earnings per share reported) compared to $0.53 ($1.19 diluted loss per share reported) in the prior year fiscal nine months or an increase of $0.07 per share which approximates a 13% increase.
"For our third quarter of fiscal 2005 our net sales increase is due primarily to the continued economic recovery throughout the world. Our net earnings were affected by two factors. First, our industry has not been as successful as anticipated in selling price recovery to offset the increase in commodity costs. Additionally, our temporary manufacturing inefficiencies, which have been corrected, impacted our third quarter results," stated John D. Craig, Chairman, President and Chief Executive Officer of the Company. "We anticipate our fiscal 2005 fourth quarter, diluted net earnings per share will be between $0.18 per share and $0.22 per share. For the full 2005 fiscal year, we expect pro forma diluted net earnings per share will be between $0.78 and $0.82 per share (between $0.61 and $0.65 per share reported), compared to $0.78 per share (a loss of $1.80 per share reported) in fiscal 2004," he said. Pro forma adjustments to calculate net earnings per share for the full years presented are interest expense (net of tax) for the assumed prepayment of debt from the proceeds of the IPO as if it occurred as of the beginning of the periods, exclusion of special charges (net of tax) and exclusion of series A convertible stock dividends. Actual weighted average shares for the full fiscal year 2005 assumes additional shares will be issued in the fourth quarter related to stock option exercises.
Yesterday, our Board of Directors set Thursday, July 21, 2005, as the date of the EnerSys 2005 Annual Meeting of Shareholders and June 1, 2005, as the record date for such meeting.
This press release contains forward-looking statements (within the meaning of the Private Securities Litigation Reform Act of 1995), which are based on management's current expectations and are subject to uncertainties and changes in circumstances. Our actual results may differ materially from the forward- looking statements for a number of reasons. For a list of the factors, which could affect our future results, including our earnings estimates, see "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations," including "Forward-Looking Statements," set forth in our Quarterly Report on Form 10-Q for the third fiscal quarter ended January 2, 2005, which was filed with the U.S. Securities and Exchange Commission. For a list of the factors that could cause our actual results to differ materially from our forward-looking statements regarding the FIAMM S.p.A. transaction, please see our press release dated February 16, 2005 announcing the proposed transaction.
This press release contains financial information determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"). EnerSys' management uses the non-GAAP measures in their analysis of the company's performance. As described in the footnotes to the tables provided below, these measures, as used by EnerSys, adjust net earnings determined in accordance with GAAP to exclude the effects of special items, including significant gains or losses that are unusual in nature or are associated with our IPO, and certain non-cash charges. Management believes presentations of financial measures excluding the impact of these items provide useful supplemental information in evaluating the operating results of our business. These disclosures should not be viewed as a substitute for net earnings determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.
EnerSys and Subsidiaries
Summary of Earnings
(In thousands, except share and per share data)
(Unaudited)
Three months ended
January 2, 2005 December 28, 2003
Net sales $273,707 $253,296
Gross profit 60,365 64,036
Special charges relating
to restructuring and
uncompleted acquisitions - 9,095
Operating earnings 16,862 11,953
Special charges relating
to a settlement
agreement - 24,405
Earnings (loss) before income taxes 10,517 (17,751)
Net earnings (loss) $6,818 $(10,400)
Net earnings (loss) available
to common shareholders $6,818 $(16,244)
Net earnings (loss)
per common share
Basic $0.15 $(1.47)
Diluted $0.14 $(1.47)
Weighted average shares
outstanding
Basic 45,954,336 11,014,421
Diluted 46,681,392 11,014,421
Pro forma net earnings
per common share (1)
Basic $0.15 $0.22
Diluted $0.14 $0.22
Pro forma weighted
average shares outstanding
Basic 45,945,559 45,945,559
Diluted 46,448,006 46,448,006
(1) Giving effect to our IPO as if it occurred at the beginning of the
first fiscal quarter of 2005 and 2004. Fiscal 2004 third quarter
pro forma net earnings per share includes $167 of additional
interest expense (net of tax) for additional borrowings from the
March 2004 recapitalization, net of the assumed repayment of debt
from the IPO proceeds, and excludes $20,770 of special charges
(net of tax) related to a settlement agreement and the series A
convertible preferred stock dividend of $5,844. Pro forma
weighted average shares outstanding are 45,945,559 basic and
46,448,006 diluted for both the third quarter of fiscal 2005 and
2004.
EnerSys and Subsidiaries
Summary of Earnings
(In thousands, except share and per share data)
(Unaudited)
Nine months ended
January 2, 2005 December 28, 2003
Net sales $798,281 $693,700
Gross profit 188,204 173,868
Special charges relating
to restructuring and
uncompleted acquisitions - 9,095
Operating earnings 59,268 41,861
Special charges relating
to a write-off of deferred
finance costs and a
prepayment penalty in
fiscal 2005 and a settlement
agreement in fiscal 2004 6,022 24,405
Earnings before income taxes 34,286 5,603
Net earnings $22,229 $4,073
Net earnings (loss) available
to common shareholders $14,074 $(13,145)
Net earnings (loss) per common share
Basic $0.42 $(1.19)
Diluted $0.42 $(1.19)
Weighted average shares outstanding
Basic 33,205,871 11,014,421
Diluted 33,803,341 11,014,421
Pro forma net earnings
per common share (2)
Basic $0.61 $0.53
Diluted $0.60 $0.53
Pro forma weighted
average shares outstanding
Basic 45,945,559 45,945,559
Diluted 46,448,006 46,448,006
(2) Giving effect to our IPO as if it occurred at the beginning of the
first fiscal quarter of 2005 and 2004. Fiscal 2005 first nine-
month pro forma net earnings per share excludes $1,879 of interest
expense (net of tax) from the assumed repayment of debt from IPO
proceeds, excludes the special charge relating to the IPO of $3,914
(net of tax) and excludes the series A convertible preferred stock
dividend of $8,155. Fiscal 2004 first nine months pro forma net
earnings per share includes $448 of additional interest expense
(net of tax) for additional borrowings from the March 2004
recapitalization, net of the assumed repayment of debt from the IPO
proceeds, and excludes the $20,770 (net of tax) special charges
related to a settlement agreement and the series A convertible
preferred stock dividend of $17,218. Pro forma weighted average
shares outstanding are 45,945,559 basic and 46,448,006 diluted for
both the first nine months of fiscal 2005 and 2004.
Pro forma net earnings are calculated giving effect to the IPO as if it occurred as of the beginning of the pro forma periods presented and eliminating the effect of the special charges (net of tax). Pro forma basic and diluted weighted-average share amounts are calculated as of the IPO effective date.
(In Millions, Except Share and Per Share Data)
Fiscal quarter ended Nine fiscal months ended
January 2, December 28, January 2, December 28,
2005 2003 2005 2003
Net earnings reconciliation:
As reported net earnings
(loss) available to $6.8 $(16.2) $14.1 $(13.1)
common shareholders
Proforma adjustments
(net of tax):
Interest expense - (0.2) (2) 1.9 (1) (0.4) (2)
Special charges - 20.8 3.9 20.8
Series A convertible
stock dividend - 5.8 8.2 17.2
Total proforma
adjustments 0.0 26.4 14.0 37.5
Proforma net
earnings available
to common
shareholders $6.8 $10.2 $28.1 $24.4
Reported earnings per share:
Basic $0.15 $(1.47) $0.42 $(1.19)
Diluted $0.14 $(1.47) $0.42 $(1.19)
Basic shares
reconciliation:
As reported basic
weighted average
shares 45,954,336 11,014,421 33,205,871 11,014,421
Proforma adjustments:
Adjust weighting to
IPO effective
date (8,777) - 12,739,688 -
Preferred stock
converted - 22,431,138 - 22,431,138
New shares
issued in IPO - 12,500,000 - 12,500,000
Total proforma
adjustments - 34,931,138 12,739,688 34,931,138
Proforma basic
weighted average
shares 45,945,559 45,945,559 45,945,559 45,945,559
Diluted shares
reconciliation:
As reported diluted
weighted average
shares 46,681,392 11,014,421 33,803,341 11,014,421
Proforma adjustments:
Adjust dilutive
options to IPO
effective date (233,386) 502,447 (97,949) 502,447
Assumed beginning
of year weighting - - 12,742,614 -
Preferred stock
converted - 22,431,138 - 22,431,138
New shares issued
in IPO - 12,500,000 - 12,500,000
Total proforma
adjustments - 35,433,585 12,644,665 35,433,585
Proforma diluted
weighted
average shares 46,448,006 46,448,006 46,448,006 46,448,006
Proforma earnings
per share:
Basic $0.15 $0.22 $0.61 $0.53
Diluted $0.14 $0.22 $0.60 $0.53
(1) resulting from the assumed prepayment of debt from the IPO proceeds
as if it occurred on April 1, 2004
(2) resulting from the net additional debt (adjusted for the assumed
prepayment of debt associated with the March 2004 recapitalization)
as if it occurred as of April 1, 2003
EnerSys will host a conference call to discuss the Company's third fiscal quarter 2005 financial results and to provide an overview of the business. The call will conclude with a question and answer session.
The call, scheduled for February 17, 2005, will be hosted by John D. Craig, Chairman, President & Chief Executive Officer and Michael T. Philion, Executive Vice President - Finance & Chief Financial Officer.
The call will also be Webcast on EnerSys' site. There will be a free download of a compatible media player on the Company's website at http://www.enersys.com.
The conference call information is:
Date: Thursday, February 17, 2005
Time: 9:00 a.m. Eastern Time
Via Internet: http://www.enersys.com
Domestic Call-In Number: 800-901-5213
International Dial-In Number: 617-786-2962
Passcode: 82654084
A replay of the conference call will be available from 11:00 a.m. on February 17, 2005 through midnight on March 10, 2005.
The replay information is:
Via Internet: http://www.enersys.com
Domestic Replay Number: 888-286-8010
International Replay Number: 617-801-6888
Passcode: 45303701
For more information, please contact Richard Zuidema, Executive Vice President, EnerSys, P.O. Box 14145, Reading, PA 19612-4145. Tel: 800-538-3627; Website: http://www.enersys.com.
About EnerSys
EnerSys, the world leader in stored energy solutions for industrial applications, manufactures, distributes and services reserve power and motive power batteries, chargers, power equipment, and battery accessories to customers worldwide. Reserve power batteries are used in the telecommunications and utility industries, uninterruptible power suppliers, and numerous applications requiring standby power. Motive power batteries are utilized in electric fork trucks and other commercial electric powered vehicles. The Company also provides aftermarket and customer support services to its customers from over 100 countries through its sales and manufacturing locations around the world.
More information regarding EnerSys can be found at http://www.enersys.com
SOURCE EnerSys
Richard Zuidema, Executive Vice President of EnerSys, +1-800-538-3627
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