Griffon Corporation Announces Second Quarter Results
Griffon reported its fiscal 2024 second-quarter results, showing a 5% decrease in revenue to $672.9 million. However, net income improved to $64.1 million, or $1.28 per share, compared to a loss in the prior year quarter. Adjusted net income was $67.5 million, or $1.35 per share. The company raised full-year segment EBITDA guidance to $555 million, repurchased shares, and announced a global sourcing strategy expansion for CPP.
Improved net income of $64.1 million, or $1.28 per share, compared to a loss in the prior year quarter.
Raised full-year segment EBITDA guidance to $555 million from $525 million.
Repurchased over 1.8 million shares during the fiscal second quarter, demonstrating confidence in the strategic plan.
CPP's global sourcing strategy expansion to improve EBITDA margins and free cash flow.
Revenue for the second quarter decreased by 5% to $672.9 million.
Adjusted EBITDA decreased by 2% from the prior year quarter.
CPP's second-quarter revenue decreased by 11% due to reduced consumer demand in North America and the U.K.
Insights
Griffon Corporation's recent earnings report indicating a 5% decrease in revenue but a significant swing to net income profitability reflects a mixed financial performance for the company. It's vital to note the contrast between top-line revenue and bottom-line net income, as this dichotomy can signal changes in operational efficiency or cost control measures that investors should be aware of. The mention of share repurchases is noteworthy too; this activity can be a sign of management's confidence in the company's value, potentially affecting the stock price positively.
Additionally, the increase in adjusted EBITDA guidance to
The increased capital expenditures to
Observing Griffon Corporation's strategic moves, such as the shift towards an asset-light structure for the CPP segment, suggests a realignment of the business model to adapt to changing market conditions. The goal of achieving a 15% segment EBITDA margin in CPP may boost investor confidence if achieved, but the anticipated benefits come with inherent execution risks associated with global supply chain management.
Investors should consider the broader industry trends, such as Griffon's increased focus on residential volume in the HBP segment in the context of current real estate market conditions. The decrease in commercial volume, on the other hand, could be a flag of market saturation or shifting demand that warrants further investigation. It is also important to contextualize the reduced consumer demand in North America and the U.K., which aligns with general consumer market performance indicators in these regions.
Griffon's approach to reducing discretionary spending and improving production costs represents a strategic initiative to optimize operations, which could lead to improved margins over time. The ceasing of manufacturing operations at multiple sites and the reduction of capital expenditures as part of the global sourcing strategy are moves aimed at creating a leaner, more flexible operational structure. However, investors should consider the potential disruption these changes might cause, including effects on employment and local economies.
Operational changes of this scale often involve significant upfront costs and can take multiple quarters to reflect in financials. How Griffon manages the transition, maintains quality and navigates international supply chain complexities will be critical to their success and, consequently, the stock's performance.
Revenue for the second quarter totaled
Net income totaled
Adjusted EBITDA for the second quarter was
“Griffon’s excellent second quarter performance exceeded our expectations due to the strength of residential volume in our Home and Building Products ("HBP") segment," said Ronald J. Kramer, Chairman and Chief Executive Officer.
“Our Consumer and Professional Products ("CPP") segment's performance continues to reflect improved profitability with the completion of the previously announced
“Given our robust year-to-date performance, and our expectations for the second half, we are raising full-year segment EBITDA guidance to
Segment Operating Results
Home and Building Products ("HBP")
HBP's second quarter revenue of
Adjusted EBITDA of
Consumer and Professional Products ("CPP")
CPP's second quarter revenue of
Adjusted EBITDA of
CPP Global Sourcing Strategy Expansion
In response to market conditions, Griffon announced in May 2023 that CPP is expanding its global sourcing strategy to include long handle tools, material handling, and wood storage and organization product lines for the U.S. market.
By transitioning these product lines to an asset-light structure, CPP’s operations will be better positioned to serve customers with a more flexible and cost-effective sourcing model that leverages supplier relationships around the world. These actions will be essential to CPP achieving
The global sourcing strategy expansion is expected to be complete by the end of calendar 2024 and remains on budget. Manufacturing operations have ceased at all affected sites:
Taxes
The Company reported pretax income from operations for the quarter ended March 31, 2024 compared to a pretax loss from operations for the quarter ended March 31, 2023, and recognized effective tax rates of
Balance Sheet and Capital Expenditures
At March 31, 2024, the Company had cash and equivalents of
Share Repurchases
Share repurchases during the quarter ended March 31, 2024 totaled 1.8 million shares of common stock, for a total of
2024 Outlook
We now expect 2024 revenue of
Other guidance for 2024 remains unchanged, including amortization of
Conference Call Information
The Company will hold a conference call today, May 8, 2024, at 8:30 AM ET.
The call can be accessed by dialing 1-844-825-9789 (
A replay of the call will be available starting on Wednesday, May 8, 2024 at 11:30 AM ET by dialing 1-844-512-2921 (
Forward-looking Statements
“Safe Harbor” Statements under the Private Securities Litigation Reform Act of 1995: All statements related to, among other things, income (loss), earnings, cash flows, revenue, changes in operations, operating improvements, the impact of the Hunter Fan transaction, the industries in which Griffon Corporation (the “Company” or “Griffon”) operates and
About Griffon Corporation
Griffon Corporation is a diversified management and holding company that conducts business through wholly-owned subsidiaries. Griffon oversees the operations of its subsidiaries, allocates resources among them and manages their capital structures. Griffon provides direction and assistance to its subsidiaries in connection with acquisition and growth opportunities as well as divestitures. In order to further diversify, Griffon also seeks out, evaluates and, when appropriate, will acquire additional businesses that offer potentially attractive returns on capital.
Griffon conducts its operations through two reportable segments:
-
Home and Building Products ("HBP") conducts its operations through Clopay. Founded in 1964, Clopay is the largest manufacturer and marketer of garage doors and rolling steel doors in
North America . Residential and commercial sectional garage doors are sold through professional dealers and leading home center retail chains throughoutNorth America under the brands Clopay, Ideal, andHolmes . Rolling steel door and grille products designed for commercial, industrial, institutional, and retail use are sold under the Cornell and Cookson brands.
-
Consumer and Professional Products (“CPP”) is a leading global provider of branded consumer and professional tools; residential, industrial and commercial fans; home storage and organization products; and products that enhance indoor and outdoor lifestyles. CPP sells products globally through a portfolio of leading brands including
AMES , since 1774, Hunter, since 1886, True Temper, and ClosetMaid.
For more information on Griffon and its operating subsidiaries, please see the Company’s website at www.griffon.com.
Griffon evaluates performance and allocates resources based on segment adjusted EBITDA and adjusted EBITDA, non-GAAP measures, which is defined as income (loss) before taxes from operations, excluding interest income and expense, depreciation and amortization, strategic review charges, non-cash impairment charges, restructuring charges, gain/loss from debt extinguishment and acquisition related expenses, as well as other items that may affect comparability, as applicable. Segment adjusted EBITDA also excludes unallocated amounts, mainly corporate overhead. Griffon believes this information is useful to investors.
The following table provides operating highlights and a reconciliation of segment adjusted EBITDA and adjusted EBITDA to income (loss) before taxes:
(in thousands) |
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||
REVENUE |
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
|
|
|
|
|
|
|
|
||||
Home and Building Products |
$ |
392,062 |
|
$ |
396,659 |
|
$ |
787,853 |
|
$ |
793,232 |
Consumer and Professional Products |
|
280,818 |
|
|
314,325 |
|
|
528,180 |
|
|
567,136 |
Total revenue |
$ |
672,880 |
|
$ |
710,984 |
|
$ |
1,316,033 |
|
$ |
1,360,368 |
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
ADJUSTED EBITDA |
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Home and Building Products |
$ |
128,924 |
|
|
$ |
131,871 |
|
|
$ |
253,643 |
|
|
$ |
256,016 |
|
Consumer and Professional Products |
|
20,121 |
|
|
|
19,635 |
|
|
|
25,660 |
|
|
|
17,826 |
|
Segment adjusted EBITDA |
|
149,045 |
|
|
|
151,506 |
|
|
|
279,303 |
|
|
|
273,842 |
|
Unallocated amounts, excluding depreciation* |
|
(14,814 |
) |
|
|
(14,630 |
) |
|
|
(28,721 |
) |
|
|
(28,406 |
) |
Adjusted EBITDA |
|
134,231 |
|
|
|
136,876 |
|
|
|
250,582 |
|
|
|
245,436 |
|
Net interest expense |
|
(25,512 |
) |
|
|
(24,643 |
) |
|
|
(50,387 |
) |
|
|
(49,187 |
) |
Depreciation and amortization |
|
(15,080 |
) |
|
|
(17,254 |
) |
|
|
(29,903 |
) |
|
|
(34,367 |
) |
Restructuring charges |
|
(2,401 |
) |
|
|
(78,334 |
) |
|
|
(14,801 |
) |
|
|
(78,334 |
) |
Gain on sale of building |
|
11 |
|
|
|
— |
|
|
|
558 |
|
|
|
10,852 |
|
Strategic review - retention and other |
|
(2,676 |
) |
|
|
(6,190 |
) |
|
|
(7,334 |
) |
|
|
(14,422 |
) |
Proxy expenses |
|
— |
|
|
|
(614 |
) |
|
|
— |
|
|
|
(2,117 |
) |
Intangible asset impairment |
|
— |
|
|
|
(100,000 |
) |
|
|
— |
|
|
|
(100,000 |
) |
Income (loss) before taxes |
$ |
88,573 |
|
|
$ |
(90,159 |
) |
|
$ |
148,715 |
|
|
$ |
(22,139 |
) |
| * Primarily Corporate Overhead | |||||||||||||||
|
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||
DEPRECIATION and AMORTIZATION |
2024 |
|
2023 |
|
2024 |
|
2023 |
||||
Segment: |
|
|
|
|
|
|
|
||||
Home and Building Products |
$ |
3,772 |
|
$ |
3,811 |
|
$ |
7,405 |
|
$ |
7,657 |
Consumer and Professional Products |
|
11,171 |
|
|
13,303 |
|
|
22,228 |
|
|
26,430 |
Total segment depreciation and amortization |
|
14,943 |
|
|
17,114 |
|
|
29,633 |
|
|
34,087 |
Corporate |
|
137 |
|
|
140 |
|
|
270 |
|
|
280 |
Total consolidated depreciation and amortization |
$ |
15,080 |
|
$ |
17,254 |
|
$ |
29,903 |
|
$ |
34,367 |
Griffon believes free cash flow ("FCF", a non-GAAP measure) is a useful measure for investors because it portrays the Company's ability to generate cash from operations for purposes such as repaying debt, funding acquisitions and paying dividends.
The following table provides a reconciliation of net cash provided by (used in) operating activities to FCF:
|
For the Six Months Ended March 31, |
||||||
(in thousands) |
|
2024 |
|
|
|
2023 |
|
Net cash provided by operating activities |
$ |
185,860 |
|
|
$ |
161,636 |
|
Acquisition of property, plant and equipment |
|
(33,289 |
) |
|
|
(11,837 |
) |
Proceeds from the sale of property, plant and equipment |
|
1,272 |
|
|
|
11,834 |
|
FCF |
$ |
153,843 |
|
|
$ |
161,633 |
|
The following tables provide a reconciliation of gross profit and selling, general and administrative expenses for items that affect comparability for the three and six months ended March 31, 2024 and 2023:
(in thousands) |
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Gross profit, as reported |
$ |
270,665 |
|
|
$ |
194,492 |
|
|
$ |
507,306 |
|
|
$ |
428,317 |
|
% of revenue |
|
40.2 |
% |
|
|
27.4 |
% |
|
|
38.5 |
% |
|
|
31.5 |
% |
Adjusting items: |
|
|
|
|
|
|
|
||||||||
Restructuring charges(1) |
|
1,334 |
|
|
|
74,645 |
|
|
|
12,980 |
|
|
|
74,645 |
|
Gross profit, as adjusted |
$ |
271,999 |
|
|
$ |
269,137 |
|
|
$ |
520,286 |
|
|
$ |
502,962 |
|
% of revenue |
|
40.4 |
% |
|
|
37.9 |
% |
|
|
39.5 |
% |
|
|
37.0 |
% |
(1) For the quarter and six months ended March 31, 2024 and 2023, restructuring charges relates to the CPP global sourcing expansion. |
|||||||||||||||
(in thousands) |
For the Three Months Ended
|
|
For the Six Months Ended
|
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Selling, general and administrative expenses, including intangible asset impairment, as reported |
$ |
157,217 |
|
|
$ |
260,301 |
|
|
$ |
310,020 |
|
|
$ |
413,021 |
|
% of revenue |
|
23.4 |
% |
|
|
36.6 |
% |
|
|
23.6 |
% |
|
|
30.4 |
% |
Adjusting items: |
|
|
|
|
|
|
|
||||||||
Restructuring charges(1) |
|
(1,067 |
) |
|
|
(3,689 |
) |
|
|
(1,821 |
) |
|
|
(3,689 |
) |
Intangible asset impairment |
|
— |
|
|
|
(100,000 |
) |
|
|
— |
|
|
|
(100,000 |
) |
Proxy expenses |
|
— |
|
|
|
(614 |
) |
|
|
— |
|
|
|
(2,117 |
) |
Strategic review - retention and other |
|
(2,676 |
) |
|
|
(6,190 |
) |
|
|
(7,334 |
) |
|
|
(14,422 |
) |
Selling, general and administrative expenses, as adjusted |
$ |
153,474 |
|
|
$ |
149,808 |
|
|
$ |
300,865 |
|
|
$ |
292,793 |
|
% of revenue |
|
22.8 |
% |
|
|
21.1 |
% |
|
|
22.9 |
% |
|
|
21.5 |
% |
(1) For the quarter and six months ended March 31, 2024 and 2023, restructuring charges relates to the CPP global sourcing expansion. |
|||||||||||||||
GRIFFON CORPORATION AND SUBSIDIARIES |
|||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) |
|||||||||||||||
(in thousands, except per share data) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
Three Months Ended March 31, |
|
Six Months Ended March 31, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Revenue |
$ |
672,880 |
|
|
$ |
710,984 |
|
|
$ |
1,316,033 |
|
|
$ |
1,360,368 |
|
Cost of goods and services |
|
402,215 |
|
|
|
516,492 |
|
|
|
808,727 |
|
|
|
932,051 |
|
Gross profit |
|
270,665 |
|
|
|
194,492 |
|
|
|
507,306 |
|
|
|
428,317 |
|
Selling, general and administrative expenses |
|
157,217 |
|
|
|
160,301 |
|
|
|
310,020 |
|
|
|
313,021 |
|
Intangible asset impairment |
|
— |
|
|
|
100,000 |
|
|
|
— |
|
|
|
100,000 |
|
Total operating expenses |
|
157,217 |
|
|
|
260,301 |
|
|
|
310,020 |
|
|
|
413,021 |
|
Income (loss) from operations |
|
113,448 |
|
|
|
(65,809 |
) |
|
|
197,286 |
|
|
|
15,296 |
|
Other income (expense) |
|
|
|
|
|
|
|
||||||||
Interest expense |
|
(26,149 |
) |
|
|
(24,879 |
) |
|
|
(51,448 |
) |
|
|
(49,527 |
) |
Interest income |
|
637 |
|
|
|
236 |
|
|
|
1,061 |
|
|
|
340 |
|
Gain on sale of building |
|
11 |
|
|
|
— |
|
|
|
558 |
|
|
|
10,852 |
|
Other, net |
|
626 |
|
|
|
293 |
|
|
|
1,258 |
|
|
|
900 |
|
Total other expense, net |
|
(24,875 |
) |
|
|
(24,350 |
) |
|
|
(48,571 |
) |
|
|
(37,435 |
) |
|
|
|
|
|
|
|
|
||||||||
Income (loss) before taxes |
|
88,573 |
|
|
|
(90,159 |
) |
|
|
148,715 |
|
|
|
(22,139 |
) |
Provision (benefit) for income taxes |
|
24,430 |
|
|
|
(27,904 |
) |
|
|
42,395 |
|
|
|
(8,586 |
) |
Net income (loss) |
$ |
64,143 |
|
|
$ |
(62,255 |
) |
|
$ |
106,320 |
|
|
$ |
(13,553 |
) |
Basic earnings (loss) per common share |
$ |
1.34 |
|
|
$ |
(1.17 |
) |
|
$ |
2.20 |
|
|
$ |
(0.26 |
) |
Basic weighted-average shares outstanding |
|
47,946 |
|
|
|
53,038 |
|
|
|
48,365 |
|
|
|
52,809 |
|
Diluted earnings (loss) per common share |
$ |
1.28 |
|
|
$ |
(1.17 |
) |
|
$ |
2.10 |
|
|
$ |
(0.26 |
) |
Diluted weighted-average shares outstanding |
|
49,931 |
|
|
|
53,038 |
|
|
|
50,714 |
|
|
|
52,809 |
|
Dividends paid per common share |
$ |
0.15 |
|
|
$ |
0.10 |
|
|
$ |
0.30 |
|
|
$ |
0.20 |
|
Net income (loss) |
$ |
64,143 |
|
|
$ |
(62,255 |
) |
|
$ |
106,320 |
|
|
$ |
(13,553 |
) |
Other comprehensive income (loss), net of taxes: |
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments |
|
(7,199 |
) |
|
|
334 |
|
|
|
3,039 |
|
|
|
12,271 |
|
Pension and other post retirement plans |
|
531 |
|
|
|
746 |
|
|
|
1,063 |
|
|
|
1,608 |
|
Change in cash flow hedges |
|
1,772 |
|
|
|
1,533 |
|
|
|
1,477 |
|
|
|
953 |
|
Total other comprehensive income (loss), net of taxes |
|
(4,896 |
) |
|
|
2,613 |
|
|
|
5,579 |
|
|
|
14,832 |
|
Comprehensive income (loss), net |
$ |
59,247 |
|
|
$ |
(59,642 |
) |
|
$ |
111,899 |
|
|
$ |
1,279 |
|
GRIFFON CORPORATION AND SUBSIDIARIES |
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||
(in thousands) |
|||||
|
(Unaudited) |
|
|
||
|
March 31,
|
|
September 30,
|
||
CURRENT ASSETS |
|
|
|
||
Cash and equivalents |
$ |
123,030 |
|
$ |
102,889 |
Accounts receivable, net of allowances of |
|
349,818 |
|
|
312,432 |
Inventories |
|
443,970 |
|
|
507,130 |
Prepaid and other current assets |
|
65,196 |
|
|
57,139 |
Assets held for sale |
|
24,172 |
|
|
— |
Assets of discontinued operations |
|
980 |
|
|
1,001 |
Total Current Assets |
|
1,007,166 |
|
|
980,591 |
PROPERTY, PLANT AND EQUIPMENT, net |
|
267,337 |
|
|
279,218 |
OPERATING LEASE RIGHT-OF-USE ASSETS |
|
168,252 |
|
|
169,942 |
GOODWILL |
|
327,864 |
|
|
327,864 |
INTANGIBLE ASSETS, net |
|
625,202 |
|
|
635,243 |
OTHER ASSETS |
|
23,805 |
|
|
21,731 |
ASSETS OF DISCONTINUED OPERATIONS |
|
4,104 |
|
|
4,290 |
Total Assets |
$ |
2,423,730 |
|
$ |
2,418,879 |
|
|
|
|
||
CURRENT LIABILITIES |
|
|
|
||
Notes payable and current portion of long-term debt |
$ |
8,152 |
|
$ |
9,625 |
Accounts payable |
|
143,152 |
|
|
116,646 |
Accrued liabilities |
|
174,247 |
|
|
193,098 |
Current portion of operating lease liabilities |
|
33,433 |
|
|
32,632 |
Liabilities of discontinued operations |
|
2,753 |
|
|
7,148 |
Total Current Liabilities |
|
361,737 |
|
|
359,149 |
LONG-TERM DEBT, net |
|
1,577,208 |
|
|
1,459,904 |
LONG-TERM OPERATING LEASE LIABILITIES |
|
145,295 |
|
|
147,224 |
OTHER LIABILITIES |
|
132,063 |
|
|
132,708 |
LIABILITIES OF DISCONTINUED OPERATIONS |
|
5,241 |
|
|
4,650 |
Total Liabilities |
|
2,221,544 |
|
|
2,103,635 |
COMMITMENTS AND CONTINGENCIES |
|
|
|
||
SHAREHOLDERS’ EQUITY |
|
|
|
||
Total Shareholders’ Equity |
|
202,186 |
|
|
315,244 |
Total Liabilities and Shareholders’ Equity |
$ |
2,423,730 |
|
$ |
2,418,879 |
GRIFFON CORPORATION AND SUBSIDIARIES |
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
(in thousands) |
|||||||
(Unaudited) |
|||||||
|
Six Months Ended March 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
|
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
||||
Net income (loss) |
$ |
106,320 |
|
|
$ |
(13,553 |
) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
|
|
|
||||
|
|
|
|
||||
Depreciation and amortization |
|
29,903 |
|
|
|
34,367 |
|
Stock-based compensation |
|
12,674 |
|
|
|
13,335 |
|
Intangible asset impairments |
|
— |
|
|
|
100,000 |
|
Asset impairment charges - restructuring |
|
8,482 |
|
|
|
59,118 |
|
Provision for losses on accounts receivable |
|
904 |
|
|
|
343 |
|
Amortization of debt discounts and issuance costs |
|
2,113 |
|
|
|
2,045 |
|
Deferred income tax provision (benefit) |
|
— |
|
|
|
(25,744 |
) |
Gain on sale of assets and investments |
|
(1,075 |
) |
|
|
(10,852 |
) |
Change in assets and liabilities: |
|
|
|
||||
Increase in accounts receivable |
|
(33,503 |
) |
|
|
(19,431 |
) |
Decrease in inventories |
|
56,250 |
|
|
|
64,582 |
|
(Increase) decrease in prepaid and other assets |
|
(5,766 |
) |
|
|
3,451 |
|
Increase (decrease) in accounts payable, accrued liabilities, income taxes payable and operating lease liabilities |
|
7,979 |
|
|
|
(51,409 |
) |
Other changes, net |
|
1,579 |
|
|
|
5,384 |
|
Net cash provided by operating activities |
|
185,860 |
|
|
|
161,636 |
|
|
|
|
|
||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
||||
Acquisition of property, plant and equipment |
|
(33,289 |
) |
|
|
(11,837 |
) |
Payments related to sale of business |
|
— |
|
|
|
(2,568 |
) |
Proceeds from the sale of property, plant and equipment |
|
1,272 |
|
|
|
11,834 |
|
|
|
|
|
||||
Net cash used in investing activities |
|
(32,017 |
) |
|
|
(2,571 |
) |
|
|
|
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
||||
Dividends paid |
|
(21,676 |
) |
|
|
(12,824 |
) |
Purchase of shares for treasury |
|
(222,421 |
) |
|
|
(12,989 |
) |
Proceeds from long-term debt |
|
179,500 |
|
|
|
45,419 |
|
Payments of long-term debt |
|
(67,184 |
) |
|
|
(119,110 |
) |
Other, net |
|
(262 |
) |
|
|
(127 |
) |
Net cash used in financing activities |
|
(132,043 |
) |
|
|
(99,631 |
) |
GRIFFON CORPORATION AND SUBSIDIARIES |
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - continued |
|||||||
(in thousands) |
|||||||
(Unaudited) |
|||||||
|
Six Months Ended March 31, |
||||||
|
|
2024 |
|
|
|
2023 |
|
CASH FLOWS FROM DISCONTINUED OPERATIONS: |
|
|
|
||||
Net cash used in operating activities |
|
(3,273 |
) |
|
|
(2,598 |
) |
|
|
|
|
||||
Net cash used in discontinued operations |
|
(3,273 |
) |
|
|
(2,598 |
) |
Effect of exchange rate changes on cash and equivalents |
|
1,614 |
|
|
|
(1,428 |
) |
NET INCREASE IN CASH AND EQUIVALENTS |
|
20,141 |
|
|
|
55,408 |
|
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD |
|
102,889 |
|
|
|
120,184 |
|
CASH AND EQUIVALENTS AT END OF PERIOD |
$ |
123,030 |
|
|
$ |
175,592 |
|
Griffon evaluates performance based on adjusted net income (loss) and the related adjusted earnings (loss) per share, which excludes restructuring charges, gain/loss from debt extinguishment, acquisition related expenses, discrete and certain other tax items, as well other items that may affect comparability, as applicable, non-GAAP measures. Griffon believes this information is useful to investors. The following tables provides a reconciliation of net income (loss) to adjusted net income and earnings (loss) per common share to adjusted earnings per common share:
(in thousands, except per share data) |
For the Three Months Ended March 31, |
|
For the Six Months Ended March 31, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net income (loss) |
$ |
64,143 |
|
|
$ |
(62,255 |
) |
|
$ |
106,320 |
|
|
$ |
(13,553 |
) |
|
|
|
|
|
|
|
|
||||||||
Adjusting items: |
|
|
|
|
|
|
|
||||||||
Restructuring charges(1) |
|
2,401 |
|
|
|
78,334 |
|
|
|
14,801 |
|
|
|
78,334 |
|
Intangible asset impairment |
|
— |
|
|
|
100,000 |
|
|
|
— |
|
|
|
100,000 |
|
Gain on sale of building |
|
(11 |
) |
|
|
— |
|
|
|
(558 |
) |
|
|
(10,852 |
) |
Strategic review - retention and other |
|
2,676 |
|
|
|
6,190 |
|
|
|
7,334 |
|
|
|
14,422 |
|
Proxy expenses |
|
— |
|
|
|
614 |
|
|
|
— |
|
|
|
2,117 |
|
Tax impact of above items(2) |
|
(1,309 |
) |
|
|
(47,224 |
) |
|
|
(5,513 |
) |
|
|
(47,055 |
) |
Discrete and certain other tax provisions (benefits), net(3) |
|
(390 |
) |
|
|
(8,723 |
) |
|
|
393 |
|
|
|
(9,056 |
) |
|
|
|
|
|
|
|
|
||||||||
Adjusted net income |
$ |
67,510 |
|
|
$ |
66,936 |
|
|
$ |
122,777 |
|
|
$ |
114,357 |
|
Earnings (loss) per common share |
$ |
1.28 |
|
|
$ |
(1.17 |
) |
|
$ |
2.10 |
|
|
$ |
(0.26 |
) |
|
|
|
|
|
|
|
|
||||||||
Adjusting items, net of tax: |
|
|
|
|
|
|
|
||||||||
Anti-dilutive share impact(4) |
|
— |
|
|
|
0.05 |
|
|
|
— |
|
|
|
0.02 |
|
Restructuring charges(1) |
|
0.04 |
|
|
|
1.06 |
|
|
|
0.22 |
|
|
|
1.06 |
|
Intangible asset impairment |
|
— |
|
|
|
1.34 |
|
|
|
— |
|
|
|
1.34 |
|
Gain on sale of building |
|
— |
|
|
|
— |
|
|
|
(0.01 |
) |
|
|
(0.15 |
) |
Strategic review - retention and other |
|
0.04 |
|
|
|
0.08 |
|
|
|
0.11 |
|
|
|
0.20 |
|
Proxy expenses |
|
— |
|
|
|
0.01 |
|
|
|
— |
|
|
|
0.03 |
|
Discrete and certain other tax provisions (benefits), net(3) |
|
(0.01 |
) |
|
|
(0.16 |
) |
|
|
0.01 |
|
|
|
(0.16 |
) |
|
|
|
|
|
|
|
|
||||||||
Adjusted earnings per common share |
$ |
1.35 |
|
|
$ |
1.21 |
|
|
$ |
2.42 |
|
|
$ |
2.07 |
|
Weighted-average shares outstanding (in thousands) |
|
47,946 |
|
|
|
53,038 |
|
|
|
48,365 |
|
|
|
52,809 |
|
Diluted weighted-average shares outstanding (in thousands) |
|
49,931 |
|
|
|
55,364 |
|
|
|
50,714 |
|
|
|
55,334 |
|
Note: Due to rounding, the sum of earnings per common share and adjusting items, net of tax, may not equal adjusted earnings per common share.
(1) For the quarters ended March 31, 2024 and 2023, restructuring charges relate to the CPP global sourcing expansion, of which
(2) The tax impact for the above reconciling adjustments from GAAP to non-GAAP net income and EPS is determined by comparing the Company's tax provision, including the reconciling adjustments, to the tax provision excluding such adjustments.
(3) Discrete and certain other tax provisions (benefits) primarily relate to the impact of a rate differential between statutory and annual effective tax rate on items impacting the quarter.
(4) In the three and six months ended March 31, 2023, Earnings (loss) per common share is calculated using basic shares on the face of the income statement. The anti-dilutive share impact represents the impact of converting from basic shares to diluted shares used in calculating Earnings (loss) per common share.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240507214507/en/
Company Contact
Brian G. Harris
SVP & Chief Financial Officer
Griffon Corporation
(212) 957-5000
IR@griffon.com
Investor Relations Contact
Michael Callahan
Managing Director
ICR Inc.
(203) 682-8311
Source: Griffon Corporation
FAQ
What was Griffon 's revenue for the second quarter of fiscal 2024?
What was the net income of Griffon for the second quarter of fiscal 2024?
What was the adjusted net income per share of Griffon for the second quarter of fiscal 2024?
What was the change in Griffon 's revenue in the second quarter of fiscal 2024 compared to the prior year quarter?
What was the change in adjusted EBITDA for Griffon in the second quarter of fiscal 2024 compared to the prior year quarter?
