Allied Motion Delivers Record Annual Gross Margin of 31.3% on Revenue of $503.0 Million in 2022
Allied Motion Technologies reported a remarkable 25% annual revenue growth to a record $503.0 million, fueled by strong demand in the Industrial and Aerospace & Defense sectors. The company achieved 35% fourth quarter revenue growth to $131.1 million with an 18.3% organic growth rate. Gross margins improved to record levels, with an annual gross margin of 31.3%. Annual net income reached $17.4 million, or $1.09 per diluted share. Orders in the fourth quarter totaled $145.6 million, leading to a strong book-to-bill ratio of 1.1x and a backlog of $330.1 million.
- Annual revenue increased 25% to $503.0 million.
- Fourth quarter revenue grew 35% to $131.1 million.
- Organic growth of 12.0% for the year on a constant currency basis.
- Gross margin expanded to a record 31.3%, up 130 basis points.
- Net income for the year was $17.4 million, or $1.09 per diluted share.
- Fourth quarter orders reached $145.6 million, with a book-to-bill ratio of 1.1x.
- Full year net income decreased from $24.1 million in the prior year to $17.4 million.
- Operating costs as a percentage of revenue increased to 25%, a rise of 140 basis points.
-
Annual revenue up
25% to a record , driven by strong demand in Industrial and Aerospace & Defense markets and incremental sales from acquisitions; Organic growth was$503.0 million 12.0% for the year on a constant currency basis -
Fourth quarter revenue grew
35% to , with organic growth of$131.1 million 18.3% on a constant currency basis -
Annual gross margin expanded 130 basis points to a record
31.3% on higher volume and accretive acquisitions; Fourth quarter gross margin expanded 240 basis points to31.1% -
Achieved annual net income of
, or$17.4 million per diluted share; Adjusted net income per share was$1.09 , up$1.88 18% for the year -
Fourth quarter net income more than doubled to
, or$3.7 million per diluted share; Adjusted net income per share for the quarter was up$0.23 43% to$0.43 -
Fourth quarter orders of
drove a book-to-bill ratio of 1.1x and record backlog of$145.6 million at year-end$330.1 million
“Our fourth quarter and full year results were strong and speak to the consistent and focused efforts of the entire Allied team to execute our strategy and deliver strong organic growth and create new growth opportunities through selective acquisitions,” commented
“We entered 2023 with momentum on our side, a record level of backlog, significantly broadened scope of expertise and solutions, and an enhanced value proposition for our customers.”
Fourth Quarter 2022 Results (Narrative compares with prior-year period unless otherwise noted)
Revenue increased
Aerospace & Defense revenue grew
Gross margin was
Operating costs and expenses were
Net income increased to
Earnings before interest, taxes, depreciation, amortization, stock-based compensation expense, business development costs, and foreign currency gains/losses (“Adjusted EBITDA”) was
Full Year 2022 Results (Narrative compares with prior-year period unless otherwise noted)
Revenue of
Gross margin was
Net income was
Balance Sheet and Cash Flow Review
Cash and cash equivalents were
Total debt was
Orders and Backlog Summary ($ in thousands)
Q4 2022 |
Q3 2022 |
Q2 2022 |
Q1 2022 |
Q4 2021 |
|||||||||||||
Orders |
$ |
145,564 |
$ |
126,158 |
$ |
139,209 |
$ |
155,295 |
$ |
114,891 |
|||||||
Backlog |
$ |
330,078 |
$ |
310,186 |
$ |
323,873 |
$ |
289,295 |
$ |
249,927 |
Fourth quarter orders increased
Backlog was up
Conference Call and Webcast
The Company will host a conference call and webcast on
To listen to the live call, dial (201) 689-8263. In addition, the webcast and slide presentation may be found at: www.alliedmotion.com/investor-relations.
A telephonic replay will be available from
About
The Company’s growth strategy is focused on being the controlled motion solutions leader in its selected target markets by leveraging its “technology/know how” to develop integrated precision solutions that utilize multiple
Safe Harbor Statement
The statements in this news release and in the Company’s
FINANCIAL TABLES FOLLOW
CONSOLIDATED STATEMENTS OF INCOME (In thousands, except per share data) (Unaudited) |
||||||||||||
For the three months ended |
For the year ended |
|||||||||||
|
|
|||||||||||
|
2022 |
2021 |
|
2022 |
|
2021 |
||||||
Revenue |
$ |
131,076 |
$ |
96,793 |
$ |
502,988 |
$ |
403,516 |
||||
Cost of goods sold |
|
90,348 |
|
69,043 |
|
345,729 |
|
282,460 |
||||
Gross profit |
|
40,728 |
|
27,750 |
|
157,259 |
|
121,056 |
||||
Operating costs and expenses: |
|
|
||||||||||
Selling |
|
5,541 |
|
4,270 |
|
21,877 |
|
17,249 |
||||
General and administrative |
|
13,438 |
|
9,870 |
|
50,677 |
|
42,419 |
||||
Engineering and development |
|
9,682 |
|
6,851 |
|
38,561 |
|
27,818 |
||||
Business development |
|
855 |
|
1,031 |
|
3,319 |
|
1,299 |
||||
Amortization of intangible assets |
|
3,036 |
|
1,718 |
|
11,169 |
|
6,245 |
||||
Total operating costs and expenses |
|
32,552 |
|
23,740 |
|
125,603 |
|
95,030 |
||||
Operating income |
|
8,176 |
|
4,010 |
|
31,656 |
|
26,026 |
||||
Other expense, net: |
|
|
||||||||||
Interest expense |
|
2,792 |
|
791 |
|
7,692 |
|
3,236 |
||||
Other expense (income), net |
|
274 |
|
(165) |
|
283 |
|
(323) |
||||
Total other expense, net |
|
3,066 |
|
626 |
|
7,975 |
|
2,913 |
||||
Income before income taxes |
|
5,110 |
|
3,384 |
|
23,681 |
|
23,113 |
||||
Income tax (provision) benefit |
|
(1,414) |
|
(1,823) |
|
(6,292) |
|
981 |
||||
Net income |
$ |
3,696 |
$ |
1,561 |
$ |
17,389 |
$ |
24,094 |
||||
Basic earnings per share: |
|
|
||||||||||
Earnings per share |
$ |
0.24 |
$ |
0.11 |
$ |
1.13 |
$ |
1.67 |
||||
Basic weighted average common shares |
|
15,671 |
|
14,527 |
|
15,448 |
|
14,413 |
||||
Diluted earnings per share: |
|
|
||||||||||
Earnings per share |
$ |
0.23 |
$ |
0.11 |
$ |
1.09 |
$ |
1.66 |
||||
Diluted weighted average common shares |
|
16,145 |
|
14,632 |
|
15,951 |
|
14,517 |
CONSOLIDATED BALANCE SHEETS (In thousands, except per share data) |
||||||
|
||||||
|
2022 |
|
2021 |
|||
Assets |
||||||
Current assets: |
||||||
Cash and cash equivalents |
$ |
30,614 |
$ |
22,463 |
||
Trade receivables, net of provision for credit losses of
|
76,213 |
51,239 |
||||
Inventories |
|
117,108 |
|
89,733 |
||
Prepaid expenses and other assets |
|
12,072 |
|
12,522 |
||
Total current assets |
|
236,007 |
|
175,957 |
||
Property, plant, and equipment, net |
|
68,640 |
|
56,983 |
||
Deferred income taxes |
|
4,199 |
|
5,321 |
||
Intangible assets, net |
|
119,075 |
|
103,786 |
||
|
|
126,366 |
|
106,633 |
||
Operating lease assets |
22,807 |
16,983 |
||||
Other long-term assets |
|
11,253 |
|
5,122 |
||
Total Assets |
$ |
588,347 |
$ |
470,785 |
||
Liabilities and Stockholders’ Equity |
||||||
Current liabilities: |
||||||
Accounts payable |
$ |
39,467 |
$ |
36,714 |
||
Accrued liabilities |
|
48,121 |
|
41,656 |
||
Total current liabilities |
|
87,588 |
|
78,370 |
||
Long-term debt |
|
235,454 |
|
158,960 |
||
Deferred income taxes |
|
6,262 |
|
5,040 |
||
Pension and post-retirement obligations |
|
3,009 |
|
3,932 |
||
Operating lease liabilities |
18,795 |
12,792 |
||||
Other long-term liabilities |
|
21,774 |
23,929 |
|||
Total liabilities |
|
372,882 |
|
283,023 |
||
Stockholders’ Equity: |
||||||
Common stock, no par value, authorized 50,000 shares; 15,978
and 15,361 shares issued and outstanding at
and |
|
83,852 |
|
68,097 |
||
Preferred stock, par value shares; no shares issued or outstanding |
|
— |
|
— |
||
Retained earnings |
|
143,576 |
|
127,757 |
||
Accumulated other comprehensive loss |
|
(11,963) |
|
(8,092) |
||
Total stockholders’ equity |
|
215,465 |
|
187,762 |
||
Total Liabilities and Stockholders’ Equity |
$ |
588,347 |
$ |
470,785 |
CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) |
||||||
For the year ended |
||||||
|
|
|||||
|
2022 |
|
2021 |
|||
Cash Flows From Operating Activities: |
||||||
Net income |
$ |
17,389 |
$ |
24,094 |
||
Adjustments to reconcile net income to net cash provided by operating activities |
||||||
Depreciation and amortization |
|
25,486 |
|
18,107 |
||
Deferred income taxes |
|
(3,722) |
|
(6,135) |
||
Provision for excess and obsolete inventory |
|
|
1,628 |
|
|
534 |
Stock-based compensation expense |
5,073 |
4,161 |
||||
Debt issue cost amortization recorded in interest expense |
202 |
141 |
||||
Other |
|
393 |
|
415 |
||
Changes in operating assets and liabilities, net of acquisition: |
||||||
Trade receivables |
|
(22,202) |
|
(170) |
||
Inventories |
|
(27,800) |
|
(22,874) |
||
Prepaid expenses and other assets |
|
887 |
|
(3,670) |
||
Accounts payable |
|
2,791 |
|
8,293 |
||
Accrued liabilities |
|
5,471 |
|
2,506 |
||
Net cash provided by operating activities |
|
5,596 |
|
25,402 |
||
Cash Flows From Investing Activities: |
||||||
Consideration paid for acquisitions, net of cash acquired |
|
(44,101) |
|
(47,254) |
||
Purchase of property and equipment |
(15,910) |
(13,716) |
||||
Net cash used in investing activities |
|
(60,011) |
|
(60,970) |
||
Cash Flows From Financing Activities: |
||||||
Proceeds from issuance of long-term debt |
|
74,731 |
|
51,379 |
||
Principal payments of long-term debt and finance lease obligations |
(7,585) |
(12,248) |
||||
Payment of debt issuance costs |
|
(391) |
|
— |
||
Dividends paid to stockholders |
|
(1,536) |
|
(1,371) |
||
Tax withholdings related to net share settlements of restricted stock |
|
(1,614) |
|
(1,928) |
||
Net cash provided by financing activities |
|
63,605 |
|
35,832 |
||
Effect of foreign exchange rate changes on cash |
|
(1,039) |
|
(932) |
||
Net decrease in cash and cash equivalents |
|
8,151 |
|
(668) |
||
Cash and cash equivalents at beginning of period |
|
22,463 |
|
23,131 |
||
Cash and cash equivalents at end of period |
$ |
30,614 |
$ |
22,463 |
Reconciliation of Non-GAAP Financial Measures
(In thousands)
(Unaudited)
In addition to reporting revenue and net income, which are
The Company believes that Revenue excluding foreign currency exchange rate impacts is a useful measure in analyzing organic sales results. The Company excludes the effect of currency translation from revenue for this measure because currency translation is not under management’s control, is subject to volatility and can obscure underlying business trends. The portion of revenue attributable to currency translation is calculated as the difference between the current period revenue and the current period revenue after applying foreign exchange rates from the prior period.
The Company believes EBITDA and Adjusted EBITDA are often a useful measure of a Company’s operating performance and are a significant basis used by the Company’s management to evaluate and compare the core operating performance of its business from period to period by removing the impact of the capital structure (interest), tangible and intangible asset base (depreciation and amortization), taxes, stock-based compensation expense, business development costs, foreign currency gains/losses on short-term assets and liabilities, and other items that are not indicative of the Company’s core operating performance. EBITDA and Adjusted EBITDA do not represent and should not be considered as an alternative to net income, operating income, net cash provided by operating activities or any other measure for determining operating performance or liquidity that is calculated in accordance with GAAP.
The Company’s calculation of Revenue excluding foreign currency exchange impacts for the three and twelve months ended
Three Months Ended |
|
Twelve Months Ended |
||
|
|
|
||
Revenue as reported |
|
|
|
|
Currency impact |
6,686 |
|
22,263 |
|
Revenue excluding foreign currency exchange impacts |
|
|
|
The Company’s calculation of Adjusted EBITDA for the three and twelve months ended
Three Months Ended |
Twelve Months Ended |
|||
|
|
|||
2022 |
2021 |
2022 |
2021 |
|
Net income |
|
|
|
|
Interest expense |
2,792 |
791 |
7,692 |
3,236 |
Provision (benefit) for income tax |
1,414 |
1,823 |
6,292 |
(981) |
Depreciation and amortization |
6,264 |
4,990 |
25,486 |
18,307 |
EBITDA |
14,166 |
9,165 |
56,859 |
44,656 |
Stock compensation expense |
1,321 |
1,060 |
5,073 |
4,161 |
Foreign currency loss |
244 |
63 |
298 |
21 |
Business development costs |
855 |
1,032 |
3,319 |
1,299 |
Adjusted EBITDA |
|
|
|
|
Reconciliation of GAAP Net Income and Diluted Earnings per Share to
Non-GAAP Adjusted Net Income and Diluted Earnings per Share
(In thousands, except per share data)
(Unaudited)
The Company’s calculation of Adjusted net income and Adjusted diluted earnings per share for the three and twelve months ended
Three Months Ended |
||||||||||||
|
||||||||||||
2022 |
Per diluted
|
2021 |
Per diluted
|
|||||||||
Net income as reported |
|
|
|
|
||||||||
Non-GAAP adjustments, net of tax |
||||||||||||
Income tax valuation allowance |
|
- |
- |
|
506 |
0.03 |
|
|||||
Amortization of intangible assets - net |
|
2,395 |
0.15 |
|
1,470 |
0.10 |
|
|||||
Foreign currency gain/ loss - net |
|
187 |
0.01 |
|
48 |
- |
|
|||||
Business development costs - net |
655 |
0.04 |
790 |
0.05 |
||||||||
Adjusted net income and diluted EPS |
|
|
|
|
||||||||
Weighted average diluted shares outstanding |
16,145 |
14,632 |
Twelve Months Ended |
||||||||||||
|
||||||||||||
2022 |
Per diluted
|
2021 |
Per diluted
|
|||||||||
Net income as reported |
|
|
|
|
||||||||
Non-GAAP adjustments, net of tax |
||||||||||||
Income tax valuation allowance |
- |
- |
|
506 |
0.03 |
|
||||||
Income tax benefit |
- |
- |
|
(7,373) |
(0.51) |
|
||||||
Amortization of intangible assets - net |
|
9,812 |
0.62 |
|
4,938 |
0.34 |
|
|||||
Foreign currency gain/ loss - net |
|
228 |
0.01 |
|
18 |
0.00 |
|
|||||
Business development costs - net |
2,542 |
0.16 |
998 |
0.07 |
||||||||
Adjusted net income and diluted EPS |
|
|
|
|
||||||||
Weighted average diluted shares outstanding |
15,951 |
14,517 |
Adjusted net income and diluted EPS are defined as net income as reported, adjusted for certain items, including amortization of intangible assets and unusual non-recurring items. Adjusted net income and diluted EPS are not a measure determined in accordance with GAAP in
View source version on businesswire.com: https://www.businesswire.com/news/home/20230307005961/en/
Investor Contacts:
716-843-3908 / 716-843-3832
dpawlowski@keiadvisors.com / cmychajluk@keiadvisors.com
Source:
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