Kaman Reports Fourth Quarter and Full Year 2023 Results
- Strong financial performance for Q4 2023 and FY 2023 with significant growth in net sales, operating income, net earnings, and adjusted EBITDA.
- Merger agreement with Arcline Investment Management, L.P. for an all-cash transaction at $46.00 per share, valued at $1.8 billion.
- Kaman's diluted earnings per share showed positive growth, reaching $0.07 and $0.28 per share, adjusted to $0.12 and $0.49 per share.
- The company refrained from conducting a conference call for Q4 due to the pending acquisition by Arcline and did not provide a financial outlook for FY 2024.
- None.
Insights
The disclosed financial results of Kaman Corp. reveal a year-over-year increase in net sales, from $687.9 million in the previous year to $775.9 million. This growth in revenue is a positive indicator of the company's market performance and could suggest effective sales strategies or increased market demand for Kaman's products. However, the reported net earnings of $7.9 million, compared to a loss of $48.6 million in the prior year, warrant a closer examination of the factors contributing to this turnaround. The improvement in net earnings could be attributed to operational efficiencies, cost optimization, or a combination of both.
Adjusted EBITDA, a measure of a company's operational profitability, increased to $106.7 million from $77.2 million, with a corresponding rise in the adjusted EBITDA margin from 11.2% to 13.7%. This margin expansion implies that Kaman has effectively managed its operating expenses and could be achieving economies of scale. Investors should note that the adjusted diluted earnings per share of $0.49, down from $1.04 in the previous year, may reflect dilutive events such as equity offerings or the conversion of convertible securities, which could affect shareholder value.
The merger agreement with Arcline Investment Management, L.P. is a significant event that could reshape Kaman's business structure and strategy. The all-cash acquisition at $46.00 per share represents a substantial premium over the current trading price, which is often the case in takeovers to incentivize shareholders to agree to the deal. This transaction, valued at approximately $1.8 billion, suggests confidence in Kaman's future potential and could signal consolidation trends within the industry. Market participants should monitor the regulatory approval process and shareholder sentiment, as these factors will play a crucial role in the completion of the merger.
The financial report includes a note on the revision of prior period information due to errors in accounting for labor costs and inventory valuation. This restatement could raise concerns about the company's internal controls over financial reporting. While the corrections do not appear to have a material impact on the overall financial position, they do highlight the importance of rigorous financial oversight. Stakeholders, including potential investors and regulators, will likely scrutinize these revisions for any implications of systemic issues within the company's accounting practices.
Fourth Quarter 2023 Highlights:
-
Net sales:
$203.1 million -
Operating income:
$12.0 million -
Net earnings:
$2.0 million -
Adjusted EBITDA*:
$25.6 million 12.6% -
Diluted earnings per share:
$0.07 $0.12
Full Year 2023 Highlights:
-
Net sales:
$775.9 million -
Operating income:
$49.1 million -
Net earnings:
$7.9 million -
Adjusted EBITDA*:
$106.7 million 13.7% -
Diluted earnings per share:
$0.28 $0.49
| Table 1. Summary of Financial Results (unaudited) | ||||||||||||||||||||
Thousands of (except share data) |
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||||||
|
|
December 31,
|
|
September 29,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
||||||||||
Net sales |
|
$ |
203,123 |
|
|
$ |
183,031 |
|
|
$ |
197,143 |
|
|
$ |
775,854 |
|
|
$ |
687,961 |
|
Net earnings (loss) |
|
|
1,995 |
|
|
|
1,466 |
|
|
|
(55,942 |
) |
|
|
7,947 |
|
|
|
(48,573 |
) |
Adjusted EBITDA* |
|
|
25,617 |
|
|
|
25,232 |
|
|
|
29,721 |
|
|
|
106,675 |
|
|
|
77,241 |
|
Adjusted EBITDA margin* |
|
|
12.6 |
% |
|
|
13.8 |
% |
|
|
15.1 |
% |
|
|
13.7 |
% |
|
|
11.2 |
% |
Diluted earnings (loss) per share |
|
$ |
0.07 |
|
|
$ |
0.05 |
|
|
$ |
(1.99 |
) |
|
$ |
0.28 |
|
|
$ |
(1.73 |
) |
Adjusted diluted earnings per share* |
|
$ |
0.12 |
|
|
$ |
0.10 |
|
|
$ |
0.38 |
|
|
$ |
0.49 |
|
|
$ |
1.04 |
|
*See the end of this release for an explanation of the Company's use of Adjusted EBITDA, Adjusted EBITDA margin, Free cash flow and Adjusted diluted earnings per share from continuing operations. See tables 5-11 for reconciliations to the most comparable GAAP measure.
(1) Information for the period ended December 31, 2022 has been revised from amounts reported in the prior year to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment and the net realizable value on certain portions of the Company's inventory at another business in the Structures segment. These errors resulted in an understatement of cost of sales, net of tax, of
"Our Engineered Products segment achieved another strong quarter and we delivered full year results in line with our revised outlook," said Ian K. Walsh, Chairman, President and Chief Executive Officer. "Our results reflect our continued execution in reshaping our portfolio, optimizing cost structure and eliminating major sources of variation in performance as we remained disciplined in our approach to capital allocation and realized additional opportunities to reduce expense across the organization."
MERGER
As announced on January 19, 2024, we have entered into a merger agreement wherein Arcline Investment Management, L.P. ("Arcline") will acquire Kaman. Under the terms of the agreement, Arcline will purchase Kaman in an all-cash transaction for
KAMAN BUSINESS RESULTS DISCUSSION BY REPORTING SEGMENT
Kaman manages its portfolio through three segments: (1) Engineered Products; (2) Precision Products; and (3) Structures.
Engineered Products - Our Engineered Products segment serves the aerospace and defense, industrial and medical markets providing sophisticated, proprietary aircraft bearings and components; super precision, miniature ball bearings; proprietary spring energized seals, springs and contacts; and wheels, brakes and related hydraulic components for helicopters, fixed-wing and UAV aircraft.
Table 2. Engineered Products Results |
|
|
|
|
|
|
||||||||||||||
Thousands of |
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||||||
|
|
December 31,
|
|
September 29,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
||||||||||
Net sales |
|
$ |
132,394 |
|
|
$ |
123,598 |
|
|
$ |
113,972 |
|
|
$ |
512,831 |
|
|
$ |
377,241 |
|
Operating income |
|
|
28,939 |
|
|
|
29,026 |
|
|
|
17,168 |
|
|
|
107,863 |
|
|
|
57,833 |
|
Adjusted EBITDA |
|
|
38,308 |
|
|
|
38,428 |
|
|
|
30,698 |
|
|
|
147,514 |
|
|
|
91,353 |
|
Adjusted EBITDA margin |
|
|
28.9 |
% |
|
|
31.1 |
% |
|
|
26.9 |
% |
|
|
28.8 |
% |
|
|
24.2 |
% |
Three months ended December 31, 2023 versus three months ended September 29, 2023 - Operating income and Adjusted EBITDA remained relatively flat and margin decreased 2.2 percentage points versus the third quarter of 2023. Results remained strong in the fourth quarter driven by higher sales and gross margin on our commercial bearings and aircraft wheels and brakes, partially offset by lower sales volume on our springs, seals and contacts used in medical applications.
Three months ended December 31, 2023 versus three months ended December 31, 2022 - Operating income increased
Precision Products - Our Precision Products segment serves the aerospace and defense markets providing precision safe and arming solutions for missile and bomb systems for the
Table 3. Precision Products Results |
|
|
|
|
|
|
||||||||||||||
Thousands of |
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||||||
|
|
December 31,
|
|
September 29,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
||||||||||
Net sales |
|
$ |
36,019 |
|
|
$ |
27,098 |
|
|
$ |
49,925 |
|
|
$ |
129,147 |
|
|
$ |
185,023 |
|
Operating (loss) income |
|
|
(536 |
) |
|
|
(3,241 |
) |
|
|
5,628 |
|
|
|
(4,532 |
) |
|
|
16,353 |
|
Adjusted EBITDA |
|
|
355 |
|
|
|
(2,458 |
) |
|
|
6,413 |
|
|
|
(1,240 |
) |
|
|
20,016 |
|
Adjusted EBITDA margin |
|
|
1.0 |
% |
|
|
(9.1 |
)% |
|
|
12.8 |
% |
|
|
(1.0 |
)% |
|
|
10.8 |
% |
(1)Information for the period ended December 31, 2022 has been revised from amounts reported in the prior year to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment. Refer to the Company's Form 10-K for the year ended December 31, 2023 for further information.
Three months ended December 31, 2023 versus three months ended September 29, 2023 - Operating loss decreased
Three months ended December 31, 2023 versus three months ended December 31, 2022 - Operating income decreased
Structures - Our Structures segment serves the aerospace and defense and medical end markets providing sophisticated complex metallic and composite aerostructures for commercial, military and general aviation fixed and rotary wing aircraft, and medical imaging solutions.
Table 4. Structures Results |
|
|
|
|
|
|
||||||||||||||
Thousands of |
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||||||
|
|
December 31,
|
|
September 29,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
||||||||||
Net sales |
|
$ |
34,710 |
|
|
$ |
32,335 |
|
|
$ |
33,246 |
|
|
$ |
133,876 |
|
|
$ |
125,697 |
|
Operating loss |
|
|
(5,400 |
) |
|
|
(3,020 |
) |
|
|
(2,502 |
) |
|
|
(9,169 |
) |
|
|
(4,623 |
) |
Adjusted EBITDA |
|
|
(4,667 |
) |
|
|
(2,222 |
) |
|
|
(1,646 |
) |
|
|
(6,063 |
) |
|
|
(1,104 |
) |
Adjusted EBITDA margin |
|
|
(13.4 |
)% |
|
|
(6.9 |
)% |
|
|
(5.0 |
)% |
|
|
(4.5 |
)% |
|
|
(0.9 |
)% |
(1)Information for the period ended December 31, 2022 has been revised from amounts reported in the prior year to correct errors related to the net realizable value on certain portions of the Company's inventory at a business in the Structures segment. Refer to the Company's Form 10-K for the year ended December 31, 2023 for further information.
Three months ended December 31, 2023 versus three months ended September 29, 2023 - Operating income and Adjusted EBITDA decreased by
Three months ended December 31, 2023 versus three months ended December 31, 2022 - Operating loss increased by
Please see the MD&A section of the Company's Form 10-K filed with the Securities and Exchange Commission concurrently with the issuance of this release for greater detail on our results and various company programs.
CONFERENCE CALL
Given the pending acquisition by Arcline, the Company is not conducting a conference call for the fourth quarter. In addition, the Company is not providing a financial outlook for fiscal year 2024.
ABOUT KAMAN CORPORATION
Kaman Corporation, founded in 1945 by aviation pioneer Charles H. Kaman, and headquartered in
NON-GAAP MEASURES DISCLOSURE
Management believes that the Non-GAAP financial measures (i.e. financial measures that are not computed in accordance with Generally Accepted Accounting Principles) identified by an asterisk (*) used in this release or in other disclosures provide important perspectives into the Company's ongoing business performance. The Company does not intend for the information to be considered in isolation or as a substitute for the related GAAP measures. Other companies may define the measures differently. We define the Non-GAAP measures used in this release and other disclosures as follows:
Adjusted EBITDA - Adjusted EBITDA for the consolidated company results is defined as net earnings before interest, taxes, other expense (income), net, depreciation and amortization and certain items that are not indicative of the operating performance of the Company for the periods presented. Adjusted EBITDA for the segments is defined as operating income before depreciation and amortization. Adjusted EBITDA margin is defined as Adjusted EBITDA as a percent of Net sales. Management believes Adjusted EBITDA and Adjusted EBITDA margin provide an additional perspective on the operating results of the organization and its earnings capacity and helps improve the comparability of our results between periods because they provide a view of our operations that excludes items that management believes are not reflective of operating performance, such as items traditionally removed from net earnings in the calculation of EBITDA as well as Other expense (income), net and certain items that are not indicative of the operating performance of the Company for the period presented. Adjusted EBITDA and Adjusted EBITDA margin are not presented as an alternative measure of operating performance, as determined in accordance with GAAP. The following tables illustrate the calculation of Adjusted EBITDA:
Table 5. Adjusted EBITDA (unaudited) |
|
|
|
|
||||||||||||||||
Thousands of |
|
Three Months Ended December 31, 2023 |
||||||||||||||||||
|
|
Consolidated |
|
Engineered Products |
|
Precision Products |
|
Structures |
|
Corp/Elims** |
||||||||||
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated Results |
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales |
|
$ |
203,123 |
|
|
$ |
132,394 |
|
|
$ |
36,019 |
|
|
$ |
34,710 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings |
|
$ |
1,995 |
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net |
|
|
10,648 |
|
|
|
|
|
|
|
|
|
||||||||
Income tax expense |
|
|
367 |
|
|
|
|
|
|
|
|
|
||||||||
Non-service pension and post retirement benefit income |
|
|
(310 |
) |
|
|
|
|
|
|
|
|
||||||||
Other income, net |
|
|
(716 |
) |
|
|
|
|
|
|
|
|
||||||||
Operating income (loss) |
|
$ |
11,984 |
|
|
$ |
28,939 |
|
|
$ |
(536 |
) |
|
$ |
(5,400 |
) |
|
$ |
(11,019 |
) |
Depreciation and amortization |
|
|
11,794 |
|
|
|
9,369 |
|
|
|
891 |
|
|
|
733 |
|
|
|
801 |
|
Restructuring and severance costs(1) |
|
|
359 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
359 |
|
Integration and implementation costs(2) |
|
|
482 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
482 |
|
Costs associated with corporate development activities(3) |
|
|
947 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
947 |
|
Program assets impairment(4) |
|
|
51 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
51 |
|
Other Adjustments |
|
$ |
13,633 |
|
|
$ |
9,369 |
|
|
$ |
891 |
|
|
$ |
733 |
|
|
$ |
2,640 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA |
|
$ |
25,617 |
|
|
$ |
38,308 |
|
|
$ |
355 |
|
|
$ |
(4,667 |
) |
|
$ |
(8,379 |
) |
Adjusted EBITDA margin |
|
|
12.6 |
% |
|
|
28.9 |
% |
|
|
1.0 |
% |
|
|
(13.4 |
)% |
|
|
||
(1) Restructuring and severance costs include actions associated with the previously announced cost reduction efforts that include the consolidation of our JPF production facilities and discontinuation of the K-MAX® aircraft production line.
(2) Integration and implementation costs include one-time costs associated with the integration of Aircraft Wheel and Brake and costs associated with the set-up of a new joint venture to satisfy existing offset requirements the Company has with a foreign customer.
(3) Costs associated with corporate development activities include one-time costs associated with the sale of Kaman Corporation and its subsidiaries.
(4) Program assets impairment includes the write-off of long lead parts received in the current period associated with K-MAX® program which were determined to have no alternative use.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and
Table 6. Adjusted EBITDA (unaudited) |
|
|
|
|
||||||||||||||||
Thousands of |
|
Three Months Ended September 29, 2023 |
||||||||||||||||||
|
|
Consolidated |
|
Engineered Products |
|
Precision Products |
|
Structures |
|
Corp/Elims** |
||||||||||
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated Results |
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales |
|
$ |
183,031 |
|
|
$ |
123,598 |
|
|
$ |
27,098 |
|
|
$ |
32,335 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings |
|
$ |
1,466 |
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net |
|
|
9,405 |
|
|
|
|
|
|
|
|
|
||||||||
Income tax expense |
|
|
462 |
|
|
|
|
|
|
|
|
|
||||||||
Non-service pension and post retirement benefit income |
|
|
(310 |
) |
|
|
|
|
|
|
|
|
||||||||
Other expense, net |
|
|
849 |
|
|
|
|
|
|
|
|
|
||||||||
Operating income (loss) |
|
$ |
11,872 |
|
|
$ |
29,026 |
|
|
$ |
(3,241 |
) |
|
$ |
(3,020 |
) |
|
$ |
(10,893 |
) |
Depreciation and amortization |
|
|
11,800 |
|
|
|
9,402 |
|
|
|
783 |
|
|
|
798 |
|
|
|
817 |
|
Restructuring and severance costs(1) |
|
|
571 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
571 |
|
Integration and implementation costs(2) |
|
|
572 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
572 |
|
Program assets impairment(3) |
|
|
417 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
417 |
|
Other Adjustments |
|
$ |
13,360 |
|
|
$ |
9,402 |
|
|
$ |
783 |
|
|
$ |
798 |
|
|
$ |
2,377 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA |
|
$ |
25,232 |
|
|
$ |
38,428 |
|
|
$ |
(2,458 |
) |
|
$ |
(2,222 |
) |
|
$ |
(8,516 |
) |
Adjusted EBITDA margin |
|
|
13.8 |
% |
|
|
31.1 |
% |
|
|
(9.1 |
)% |
|
|
(6.9 |
)% |
|
|
||
(1) Restructuring and severance costs include actions associated with the previously announced cost reduction efforts that include the consolidation of our JPF production facilities and discontinuation of the K-MAX® aircraft production line.
(2) Integration and implementation costs include one-time costs associated with the integration of Aircraft Wheel and Brake and costs associated with the set-up of a new joint venture to satisfy existing offset requirements the Company has with a foreign customer.
(3) Program assets impairment includes the write-off of long lead parts received in the current period associated with K-MAX® program which were determined to have no alternative use.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and
Table 7. Adjusted EBITDA (unaudited) |
|
|
|
|
||||||||||||||||
Thousands of |
|
Three Months Ended December 31, 2022 |
||||||||||||||||||
|
|
Consolidated |
|
Engineered Products |
|
Precision Products |
|
Structures |
|
Corp/Elims** |
||||||||||
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated Results |
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales |
|
$ |
197,143 |
|
|
$ |
113,972 |
|
|
$ |
49,925 |
|
|
$ |
33,246 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net (loss) earnings |
|
$ |
(55,942 |
) |
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net |
|
|
8,786 |
|
|
|
|
|
|
|
|
|
||||||||
Income tax expense (benefit) |
|
|
(18,991 |
) |
|
|
|
|
|
|
|
|
||||||||
Non-service pension and post retirement benefit income |
|
|
(5,145 |
) |
|
|
|
|
|
|
|
|
||||||||
Other income, net |
|
|
(2,100 |
) |
|
|
|
|
|
|
|
|
||||||||
Operating income (loss) |
|
$ |
(73,392 |
) |
|
$ |
17,168 |
|
|
$ |
5,628 |
|
|
$ |
(2,502 |
) |
|
$ |
(93,686 |
) |
Depreciation and amortization |
|
|
13,675 |
|
|
|
11,231 |
|
|
|
785 |
|
|
|
856 |
|
|
|
803 |
|
Goodwill impairment |
|
|
25,306 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
25,306 |
|
Program assets impairment |
|
|
53,677 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
53,677 |
|
Restructuring and severance costs |
|
|
6,989 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
6,989 |
|
Cost associated with corporate development activities |
|
|
1,167 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,167 |
|
Inventory step-up associated with acquisition |
|
|
2,299 |
|
|
|
2,299 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Other Adjustments |
|
$ |
103,113 |
|
|
$ |
13,530 |
|
|
$ |
785 |
|
|
$ |
856 |
|
|
$ |
87,942 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA |
|
$ |
29,721 |
|
|
$ |
30,698 |
|
|
$ |
6,413 |
|
|
$ |
(1,646 |
) |
|
$ |
(5,744 |
) |
Adjusted EBITDA margin |
|
|
15.1 |
% |
|
|
26.9 |
% |
|
|
12.8 |
% |
|
|
(5.0 |
)% |
|
|
||
(1)Information for the period ended December 31, 2022 has been revised from amounts reported in prior periods to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment and the net realizable value on certain portions of the Company's inventory at another business in the Structures segment.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and
Table 8. Adjusted EBITDA (unaudited) |
|
|
|
|
||||||||||||||||
Thousands of |
|
Twelve Months Ended December 31, 2023 |
||||||||||||||||||
|
|
Consolidated |
|
Engineered Products |
|
Precision Products |
|
Structures |
|
Corp/Elims** |
||||||||||
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated Results |
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales |
|
$ |
775,854 |
|
|
$ |
512,831 |
|
|
$ |
129,147 |
|
|
$ |
133,876 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings |
|
$ |
7,947 |
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net |
|
|
39,997 |
|
|
|
|
|
|
|
|
|
||||||||
Income tax expense |
|
|
2,738 |
|
|
|
|
|
|
|
|
|
||||||||
Non-service pension and post retirement benefit income |
|
|
(1,240 |
) |
|
|
|
|
|
|
|
|
||||||||
Other income, net |
|
|
(339 |
) |
|
|
|
|
|
|
|
|
||||||||
Operating income (loss) |
|
$ |
49,103 |
|
|
$ |
107,863 |
|
|
$ |
(4,532 |
) |
|
$ |
(9,169 |
) |
|
$ |
(45,059 |
) |
Depreciation and amortization |
|
|
50,038 |
|
|
|
40,408 |
|
|
|
3,292 |
|
|
|
3,106 |
|
|
|
3,232 |
|
Restructuring and severance costs(1) |
|
|
3,392 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,392 |
|
Integration and implementation costs(2) |
|
|
2,888 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,888 |
|
Costs associated with corporate development activities(3) |
|
|
947 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
947 |
|
Program assets impairment(4) |
|
|
1,064 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,064 |
|
Tax contingency reversal(5) |
|
|
(757 |
) |
|
|
(757 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Other Adjustments |
|
$ |
57,572 |
|
|
$ |
39,651 |
|
|
$ |
3,292 |
|
|
$ |
3,106 |
|
|
$ |
11,523 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA |
|
$ |
106,675 |
|
|
$ |
147,514 |
|
|
$ |
(1,240 |
) |
|
$ |
(6,063 |
) |
|
$ |
(33,536 |
) |
Adjusted EBITDA margin |
|
|
13.7 |
% |
|
|
28.8 |
% |
|
|
(1.0 |
)% |
|
|
(4.5 |
)% |
|
|
||
(1) Restructuring and severance costs include actions associated with the previously announced cost reduction efforts that include the consolidation of our JPF production facilities and discontinuation of the K-MAX® aircraft production line.
(2) Integration and implementation costs include one-time costs associated with the integration of Aircraft Wheel and Brake and costs associated with the set-up of a new joint venture to satisfy existing offset requirements the Company has with a foreign customer.
(3) Costs associated with corporate development activities include one-time costs associated with the sale of Kaman Corporation and its subsidiaries.
(4) Program assets impairment includes the write-off of long lead parts received in the current period associated with K-MAX® program which were determined to have no alternative use.
(5) Following an evaluation of a wide range of factors, including legislative activity and administrative practices, the Company deemed a reserve was no longer needed for a certain tax contingency.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and
Table 9. Adjusted EBITDA (unaudited) |
|
|
|
|
||||||||||||||||
Thousands of |
|
Twelve Months Ended December 31, 2022 |
||||||||||||||||||
|
|
Consolidated |
|
Engineered Products |
|
Precision Products |
|
Structures |
|
Corp/Elims** |
||||||||||
Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
||||||||||
Consolidated Results |
|
|
|
|
|
|
|
|
|
|
||||||||||
Net sales |
|
$ |
687,961 |
|
|
$ |
377,241 |
|
|
$ |
185,023 |
|
|
$ |
125,697 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net earnings |
|
$ |
(48,573 |
) |
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net |
|
|
16,874 |
|
|
|
|
|
|
|
|
|
||||||||
Income tax (benefit) expense |
|
|
(17,360 |
) |
|
|
|
|
|
|
|
|
||||||||
Non-service pension and post retirement benefit income |
|
|
(20,574 |
) |
|
|
|
|
|
|
|
|
||||||||
Other income, net |
|
|
315 |
|
|
|
|
|
|
|
|
|
||||||||
Operating (loss) income |
|
$ |
(69,318 |
) |
|
$ |
57,833 |
|
|
$ |
16,353 |
|
|
$ |
(4,623 |
) |
|
$ |
(138,881 |
) |
Depreciation and amortization |
|
|
40,712 |
|
|
|
30,461 |
|
|
|
3,663 |
|
|
|
3,519 |
|
|
|
3,069 |
|
Goodwill impairment |
|
|
25,306 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
25,306 |
|
Program assets impairment |
|
|
53,677 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
53,677 |
|
Restructuring and severance costs |
|
|
9,842 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
9,842 |
|
Cost associated with corporate development activities |
|
|
14,420 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
14,420 |
|
Inventory step-up associated with acquisition |
|
|
3,059 |
|
|
|
3,059 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Gain on sale of business |
|
|
(457 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(457 |
) |
Other Adjustments |
|
$ |
146,559 |
|
|
$ |
33,520 |
|
|
$ |
3,663 |
|
|
$ |
3,519 |
|
|
$ |
105,857 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Adjusted EBITDA |
|
$ |
77,241 |
|
|
$ |
91,353 |
|
|
$ |
20,016 |
|
|
$ |
(1,104 |
) |
|
$ |
(33,024 |
) |
Adjusted EBITDA margin |
|
|
11.2 |
% |
|
|
24.2 |
% |
|
|
10.8 |
% |
|
|
(0.9 |
)% |
|
|
||
(1)Information for the period December 31, 2022 has been revised from amounts reported in prior periods to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment and the net realizable value on certain portions of the Company's inventory at another business in the Structures segment. Refer to the Company's Form 10-K for the year ended December 31, 2023 for further information.
**Corp/Elims Operating income (loss) represents the Corporate office expenses and
Adjusted Net Earnings and Adjusted Diluted Earnings Per Share - Adjusted earnings from continuing operations and adjusted diluted earnings per share are defined as GAAP "Earnings from continuing operations" and "Diluted earnings per share from continuing operations", less items that are not indicative of the operating performance of the business for the periods presented. These items are included in the reconciliation below. Management uses adjusted earnings from continuing operations and adjusted diluted earnings per share to evaluate performance period over period, to analyze the underlying trends in our business and to assess its performance relative to its competitors. We believe that this information is useful for investors and financial institutions seeking to analyze and compare companies on the basis of operating performance.
The following table illustrates the calculation of adjusted earnings from continuing operations and adjusted diluted earnings per share:
Table 10. Adjusted Net Earnings and Adjusted Diluted Earnings per Share (unaudited) |
||||||||||||||||||||||||
Thousands of |
|
|
|
|
|
|
||||||||||||||||||
|
|
Three Months Ended |
|
Three Months Ended |
||||||||||||||||||||
|
|
December 31, 2023 |
|
December 31, 2022 |
||||||||||||||||||||
|
|
Pre-Tax |
|
Tax-Effected |
|
Diluted EPS |
|
Pre-Tax |
|
Tax-Effected |
|
Diluted EPS |
||||||||||||
Net (loss) earnings |
|
$ |
2,362 |
|
|
$ |
1,995 |
|
|
$ |
0.07 |
|
|
$ |
(74,933 |
) |
|
$ |
(55,942 |
) |
|
$ |
(1.99 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
25,306 |
|
|
|
18,874 |
|
|
|
0.67 |
|
Program assets impairment |
|
|
51 |
|
|
|
40 |
|
|
|
— |
|
|
|
53,677 |
|
|
|
40,034 |
|
|
|
1.43 |
|
Restructuring and severance costs |
|
|
359 |
|
|
|
284 |
|
|
|
0.01 |
|
|
|
6,989 |
|
|
|
5,213 |
|
|
|
0.18 |
|
Integration and implementation costs |
|
|
482 |
|
|
|
381 |
|
|
|
0.01 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Costs associated with corporate development activities |
|
|
947 |
|
|
|
748 |
|
|
|
0.03 |
|
|
|
1,167 |
|
|
|
870 |
|
|
|
0.03 |
|
Inventory step-up associated with acquisition |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,299 |
|
|
|
1,715 |
|
|
|
0.06 |
|
Adjustments |
|
$ |
1,839 |
|
|
$ |
1,453 |
|
|
$ |
0.05 |
|
|
$ |
89,438 |
|
|
$ |
66,706 |
|
|
$ |
2.37 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjusted net earnings |
|
$ |
4,201 |
|
|
$ |
3,448 |
|
|
$ |
0.12 |
|
|
$ |
14,505 |
|
|
$ |
10,764 |
|
|
$ |
0.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Diluted weighted average shares outstanding |
|
|
|
|
|
|
28,403 |
|
|
|
|
|
|
|
28,051 |
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
Three Months Ended September 29, 2023 |
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
Pre-Tax |
|
Tax-Effected |
|
Diluted EPS |
||||||||||||
Net earnings |
|
$ |
1,928 |
|
|
$ |
1,466 |
|
|
$ |
0.05 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Restructuring and severance costs |
|
|
571 |
|
|
|
451 |
|
|
|
0.02 |
|
||||||||||||
Integration and implementation costs |
|
|
572 |
|
|
|
452 |
|
|
|
0.02 |
|
||||||||||||
Program assets impairment |
|
|
417 |
|
|
|
329 |
|
|
|
0.01 |
|
||||||||||||
Adjustments |
|
$ |
1,560 |
|
|
$ |
1,232 |
|
|
$ |
0.05 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjusted net earnings |
|
$ |
3,488 |
|
|
$ |
2,698 |
|
|
$ |
0.10 |
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Diluted weighted average shares outstanding |
|
|
|
|
|
|
28,350 |
|
||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Table 10 (cont). Adjusted Earnings from Continuing Operations and Adjusted Diluted Earnings per Share (unaudited) |
||||||||||||||||||||||||
Thousands of |
|
|
|
|
|
|
||||||||||||||||||
|
|
Twelve Months Ended |
|
Twelve Months Ended |
||||||||||||||||||||
|
|
December 31, 2023 |
|
December 31, 2022 |
||||||||||||||||||||
|
|
Pre-Tax |
|
Tax-Effected |
|
Diluted EPS |
|
Pre-Tax |
|
Tax-Effected |
|
Diluted EPS |
||||||||||||
Net earnings (loss) |
|
$ |
10,685 |
|
|
$ |
7,947 |
|
|
$ |
0.28 |
|
|
$ |
(65,933 |
) |
|
$ |
(48,573 |
) |
|
$ |
(1.73 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
25,306 |
|
|
|
18,580 |
|
|
|
0.66 |
|
Program assets impairment |
|
|
1,064 |
|
|
|
840 |
|
|
|
0.03 |
|
|
|
53,677 |
|
|
|
39,410 |
|
|
|
1.41 |
|
Restructuring and severance costs |
|
|
3,392 |
|
|
|
2,680 |
|
|
|
0.09 |
|
|
|
9,842 |
|
|
|
7,226 |
|
|
|
0.25 |
|
Costs associated with corporate development activities |
|
|
947 |
|
|
|
748 |
|
|
|
0.03 |
|
|
|
14,420 |
|
|
|
10,587 |
|
|
|
0.38 |
|
Inventory step-up associated with acquisition |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,059 |
|
|
|
2,246 |
|
|
|
0.08 |
|
Integration and implementation costs |
|
|
2,888 |
|
|
|
2,282 |
|
|
|
0.08 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Tax contingency reversal |
|
|
(757 |
) |
|
|
(598 |
) |
|
|
(0.02 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
(Gain) loss on sale of business |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(457 |
) |
|
|
(336 |
) |
|
|
(0.01 |
) |
Adjustments |
|
$ |
7,534 |
|
|
$ |
5,952 |
|
|
$ |
0.21 |
|
|
$ |
105,847 |
|
|
$ |
77,713 |
|
|
$ |
2.77 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Adjusted net earnings |
|
$ |
18,219 |
|
|
$ |
13,899 |
|
|
$ |
0.49 |
|
|
$ |
39,914 |
|
|
$ |
29,140 |
|
|
$ |
1.04 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Diluted weighted average shares outstanding |
|
|
|
|
|
|
28,343 |
|
|
|
|
|
|
|
28,011 |
|
||||||||
Free Cash Flow - Free cash flow is defined as GAAP “Net cash provided by (used in) operating activities” in a period less “Expenditures for property, plant & equipment” in the same period. Management believes free cash flow provides an important perspective on our ability to generate cash from our business operations and, as such, that it is an important financial measure for use in evaluating the Company's financial performance. Free cash flow should not be viewed as representing the residual cash flow available for discretionary expenditures such as dividends to shareholders or acquisitions. Management uses free cash flow internally to assess overall liquidity. The following table illustrates the calculation of free cash flow.
Table 11. Free Cash Flow (unaudited) |
||||||||||||||||||||
Thousands of |
|
Three Months Ended |
|
Last Twelve Months |
||||||||||||||||
|
|
March 31,
|
|
June 30,
|
|
September 29,
|
|
December 31,
|
|
December 31,
|
||||||||||
Net cash provided by operating activities |
|
$ |
(5,453 |
) |
|
$ |
24,259 |
|
|
$ |
10,867 |
|
|
$ |
43,042 |
|
|
$ |
72,715 |
|
Expenditures for property, plant & equipment |
|
|
(5,948 |
) |
|
|
(6,888 |
) |
|
|
(7,028 |
) |
|
|
(6,138 |
) |
|
|
(26,002 |
) |
Free cash flow |
|
$ |
(11,401 |
) |
|
$ |
17,371 |
|
|
$ |
3,839 |
|
|
$ |
36,904 |
|
|
$ |
46,713 |
|
FORWARD-LOOKING STATEMENTS
This report contains "forward-looking statements" within the meaning of the safe harbor provisions of the
Because forward-looking statements relate to the future, they are subject to inherent risks, uncertainties and other factors that may cause the Company's actual results and financial condition to differ materially from those expressed or implied in the forward-looking statements. Such risks, uncertainties and other factors include, among others: (i) the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; (ii) the risk that the Company’s shareholders may not approve the proposed transaction; (iii) inability to complete the proposed transaction because, among other reasons, conditions to the closing of the proposed transaction may not be satisfied or waived; (iv) uncertainty as to the timing of completion of the proposed transaction; (v) potential adverse effects or changes to relationships with customers, employees, suppliers or other parties resulting from the announcement or completion of the proposed transaction; (vi) potential litigation relating to the proposed transaction that could be instituted against the Company, Arcline or their respective directors and officers, including the effects of any outcomes related thereto; (vii) possible disruptions from the proposed transaction that could harm the Company’s or Arcline’s business, including current plans and operations; (viii) changes in domestic and foreign economic and competitive conditions in markets served by the Company, particularly the defense, commercial aviation and industrial production markets; (ix) changes in government and customer priorities and requirements (including cost-cutting initiatives, government and customer shut-downs, the potential deferral of awards, terminations or reductions of expenditures to respond to the priorities of Congress and the Administration, or budgetary cuts resulting from Congressional actions or automatic sequestration); (x) changes in geopolitical conditions in countries where the Company does or intends to do business; (xi) the successful conclusion of competitions for government programs (including new, follow-on and successor programs) and thereafter successful contract negotiations with government authorities (both foreign and domestic) for the terms and conditions of the programs; (xii) the timely receipt of any necessary export approvals and/or other licenses or authorizations from the USG; (xiii) timely satisfaction or fulfillment of material contractual conditions precedents in customer purchase orders, contracts, or similar arrangements; (xiv) the existence of standard government contract provisions permitting renegotiation of terms and termination for the convenience of the government; (xv) the successful resolution of government inquiries or investigations relating to our businesses and programs; (xvi) risks and uncertainties associated with the successful implementation and ramp up of significant new programs, including the ability to manufacture the products to the detailed specifications required and recover start-up costs and other investments in the programs; (xvii) potential difficulties associated with variable acceptance test results, given sensitive production materials and extreme test parameters; (xiii) the continued support of the existing K-MAX® helicopter fleet, including sale of existing K-MAX® spare parts inventory and the receipt of orders for new aircraft sufficient to recover our investments in the K-MAX® production line; (xix) the accuracy of current cost estimates associated with environmental remediation activities; (xx) the profitable integration of acquired businesses into the Company's operations; (xxi) the ability to recover from cyber-based or other security attacks, information technology failures or other disruptions; (xxii) changes in supplier sales or vendor incentive policies; (xxiii) the ability of our suppliers to satisfy their performance obligations, including any supply chain disruptions; (xxiv) the effects of price increases or decreases; (xxv) the effects of pension regulations, pension plan assumptions, pension plan asset performance, future contributions and the pension freeze; (xxvi) future levels of indebtedness and capital expenditures; (xxvii) compliance with our debt covenants; (xxiii) the continued availability of raw materials and other commodities in adequate supplies and the effect of increased costs for such items; (xxix) the effects of currency exchange rates and foreign competition on future operations; (xxx) changes in laws and regulations, taxes, interest rates, inflation rates and general business conditions; (xxxi) future repurchases and/or issuances of common stock;(xxxii) the occurrence of unanticipated restructuring costs or the failure to realize anticipated savings or benefits from past or future expense reduction actions; (xxxiii) the ability to recruit and retain skilled employees; (xxxiv) the successful resolution of all pending and future investigations, litigation or claims relating to the manufacture or design of our products, including, without limitation, the K-MAX® helicopter; and (xxxv) other risks and uncertainties set forth herein and in our 2023 Form 10-K.
Any forward-looking information provided in this release should be considered with these factors in mind. We assume no obligation to update any forward-looking statements contained in this report.
KAMAN CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Operations
(Thousands of |
||||||||||||||||
|
|
Three Months Ended |
|
Twelve Months Ended |
||||||||||||
|
|
December 31, 2023 |
|
December 31, 2022 |
|
December 31, 2023 |
|
December 31, 2022 |
||||||||
Net sales |
|
$ |
203,123 |
|
|
$ |
197,143 |
|
|
$ |
775,854 |
|
|
$ |
687,961 |
|
Cost of sales |
|
|
136,400 |
|
|
|
133,437 |
|
|
|
504,646 |
|
|
|
467,445 |
|
Program inventory impairment |
|
|
51 |
|
|
|
44,542 |
|
|
|
1,064 |
|
|
|
44,542 |
|
Gross profit |
|
|
66,672 |
|
|
|
19,164 |
|
|
|
270,144 |
|
|
|
175,974 |
|
Selling, general and administrative expenses |
|
|
43,145 |
|
|
|
38,467 |
|
|
|
170,910 |
|
|
|
166,447 |
|
Goodwill impairment |
|
|
— |
|
|
|
25,306 |
|
|
|
— |
|
|
|
25,306 |
|
Program contract costs impairment |
|
|
— |
|
|
|
9,135 |
|
|
|
— |
|
|
|
9,135 |
|
Research and development costs |
|
|
5,582 |
|
|
|
5,287 |
|
|
|
20,704 |
|
|
|
19,552 |
|
Intangible asset amortization expense |
|
|
5,572 |
|
|
|
7,307 |
|
|
|
25,509 |
|
|
|
15,331 |
|
Restructuring and severance costs |
|
|
359 |
|
|
|
6,989 |
|
|
|
3,392 |
|
|
|
9,842 |
|
Gain on sale of business |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(457 |
) |
Net loss on disposition of assets |
|
|
30 |
|
|
|
65 |
|
|
|
526 |
|
|
|
136 |
|
Operating income (loss) |
|
|
11,984 |
|
|
|
(73,392 |
) |
|
|
49,103 |
|
|
|
(69,318 |
) |
Interest expense, net |
|
|
10,648 |
|
|
|
8,786 |
|
|
|
39,997 |
|
|
|
16,874 |
|
Non-service pension and post retirement benefit income |
|
|
(310 |
) |
|
|
(5,145 |
) |
|
|
(1,240 |
) |
|
|
(20,574 |
) |
Other (income) expense, net |
|
|
(716 |
) |
|
|
(2,100 |
) |
|
|
(339 |
) |
|
|
315 |
|
Earnings (loss) before income taxes |
|
|
2,362 |
|
|
|
(74,933 |
) |
|
|
10,685 |
|
|
|
(65,933 |
) |
Income tax expense (benefit) |
|
|
367 |
|
|
|
(18,991 |
) |
|
|
2,738 |
|
|
|
(17,360 |
) |
Net earnings (loss) |
|
$ |
1,995 |
|
|
$ |
(55,942 |
) |
|
$ |
7,947 |
|
|
$ |
(48,573 |
) |
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share: |
|
|
|
|
|
|
|
|
||||||||
Basic earnings (loss) per share |
|
$ |
0.07 |
|
|
$ |
(1.99 |
) |
|
$ |
0.28 |
|
|
$ |
(1.73 |
) |
Diluted earnings (loss) per share |
|
$ |
0.07 |
|
|
$ |
(1.99 |
) |
|
$ |
0.28 |
|
|
$ |
(1.73 |
) |
Average shares outstanding: |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
|
28,265 |
|
|
|
28,051 |
|
|
|
28,208 |
|
|
|
28,011 |
|
Diluted |
|
|
28,403 |
|
|
|
28,051 |
|
|
|
28,343 |
|
|
|
28,011 |
|
(1) The condensed consolidated statement of operations for the three-month and twelve-month fiscal periods ended December 31, 2022 has been revised from amounts reported in the prior year to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment and the net realizable value on certain portions of the Company's inventory at another business in the Structures segment. These errors resulted in an understatement of cost of sales, net of tax, of
KAMAN CORPORATION AND SUBSIDIARIES Condensed Consolidated Balance Sheets
(Thousands of |
||||||||
|
|
December 31, 2023 |
|
December 31, 2022 |
||||
Assets |
|
|
|
|
||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
35,183 |
|
|
$ |
24,154 |
|
Accounts receivable, net |
|
|
96,882 |
|
|
|
87,659 |
|
Contract assets |
|
|
94,091 |
|
|
|
113,182 |
|
Inventories |
|
|
207,607 |
|
|
|
172,383 |
|
Income tax refunds receivable |
|
|
1,276 |
|
|
|
14,843 |
|
Other current assets |
|
|
17,400 |
|
|
|
16,114 |
|
Total current assets |
|
|
452,439 |
|
|
|
428,335 |
|
Property, plant and equipment, net of accumulated depreciation of |
|
|
205,210 |
|
|
|
201,606 |
|
Operating right-of-use assets, net |
|
|
7,774 |
|
|
|
7,391 |
|
Goodwill |
|
|
383,997 |
|
|
|
379,854 |
|
Other intangible assets, net |
|
|
347,424 |
|
|
|
372,331 |
|
Deferred income taxes |
|
|
46,917 |
|
|
|
47,385 |
|
Other assets |
|
|
54,894 |
|
|
|
51,207 |
|
Total assets |
|
$ |
1,498,655 |
|
|
$ |
1,488,109 |
|
Liabilities and Shareholders’ Equity |
|
|
|
|
||||
Current liabilities: |
|
|
|
|
||||
Current portion of long-term debt, net of debt issuance costs |
|
$ |
199,128 |
|
|
$ |
— |
|
Accounts payable – trade |
|
|
51,862 |
|
|
|
48,277 |
|
Accrued salaries and wages |
|
|
37,005 |
|
|
|
31,395 |
|
Contract liabilities, current portion |
|
|
12,284 |
|
|
|
4,081 |
|
Operating lease liabilities, current portion |
|
|
3,492 |
|
|
|
3,332 |
|
Income taxes payable |
|
|
707 |
|
|
|
393 |
|
Other current liabilities |
|
|
38,322 |
|
|
|
39,097 |
|
Total current liabilities |
|
|
342,800 |
|
|
|
126,575 |
|
Long-term debt, excluding current portion, net of debt issuance costs |
|
|
358,000 |
|
|
|
561,061 |
|
Deferred income taxes |
|
|
8,082 |
|
|
|
6,079 |
|
Underfunded pension |
|
|
42,268 |
|
|
|
52,309 |
|
Contract liabilities, noncurrent portion |
|
|
19,787 |
|
|
|
20,515 |
|
Operating lease liabilities, noncurrent portion |
|
|
4,646 |
|
|
|
4,534 |
|
Other long-term liabilities |
|
|
31,305 |
|
|
|
36,280 |
|
Commitments and contingencies |
|
|
|
|
||||
Shareholders' equity: |
|
|
|
|
||||
Preferred stock, |
|
|
— |
|
|
|
— |
|
Common stock, |
|
|
30,954 |
|
|
|
30,640 |
|
Additional paid-in capital |
|
|
254,727 |
|
|
|
245,436 |
|
Retained earnings |
|
|
670,607 |
|
|
|
685,234 |
|
Accumulated other comprehensive income (loss) |
|
|
(141,584 |
) |
|
|
(158,421 |
) |
Less 2,663,532 and 2,607,841 shares of common stock, respectively, held in treasury, at cost |
|
|
(122,937 |
) |
|
|
(122,133 |
) |
Total shareholders’ equity |
|
|
691,767 |
|
|
|
680,756 |
|
Total liabilities and shareholders’ equity |
|
$ |
1,498,655 |
|
|
$ |
1,488,109 |
|
(1) The condensed consolidated balance sheet at December 31, 2022 has been revised from amounts reported in the prior year to correct misstatements related to the accounting for certain labor costs at one business in the Precision Products segment and the net realizable value on certain portions of the Company's inventory at another business in the Structures segment. The correction of these errors impacted the amounts reported for inventory, income tax refunds receivable and retained earnings. Refer to the Company's Form 10-K for the year ended December 31, 2023 for further information.
KAMAN CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Cash Flows
(Thousands of |
||||||||
|
|
Twelve Months Ended |
||||||
|
|
December 31, 2023 |
|
December 31, 2022 |
||||
Cash flows from operating activities: |
|
|
|
|
||||
Net earnings (loss) |
|
$ |
7,947 |
|
|
$ |
(48,573 |
) |
Adjustments to reconcile earnings, net of tax to net cash provided by operating activities: |
|
|
|
|
||||
Depreciation and amortization |
|
|
50,038 |
|
|
|
40,712 |
|
Amortization of debt issuance costs |
|
|
3,654 |
|
|
|
2,750 |
|
Provision for doubtful accounts |
|
|
1,998 |
|
|
|
1,301 |
|
Gain on sale of business |
|
|
— |
|
|
|
(457 |
) |
Net loss on disposition of assets |
|
|
526 |
|
|
|
136 |
|
Goodwill impairment |
|
|
— |
|
|
|
25,306 |
|
Program inventory impairment |
|
|
1,064 |
|
|
|
44,542 |
|
Program contract cost impairment |
|
|
— |
|
|
|
9,135 |
|
Net loss on derivative instruments |
|
|
97 |
|
|
|
1,175 |
|
Stock compensation expense |
|
|
7,681 |
|
|
|
7,821 |
|
Non-cash consideration received for blade exchange |
|
|
(1,309 |
) |
|
|
(827 |
) |
Deferred income taxes |
|
|
(1,123 |
) |
|
|
(19,054 |
) |
Changes in assets and liabilities, excluding effects of acquisitions/divestitures: |
|
|
|
|
||||
Accounts receivable |
|
|
(10,749 |
) |
|
|
(8,387 |
) |
Contract assets |
|
|
19,117 |
|
|
|
(707 |
) |
Inventories |
|
|
(35,721 |
) |
|
|
(14,873 |
) |
Income tax refunds receivable |
|
|
13,567 |
|
|
|
(772 |
) |
Operating right of use assets |
|
|
(350 |
) |
|
|
3,551 |
|
Other assets |
|
|
(469 |
) |
|
|
(2,262 |
) |
Accounts payable - trade |
|
|
3,439 |
|
|
|
1,959 |
|
Contract liabilities |
|
|
7,436 |
|
|
|
4,433 |
|
Operating lease liabilities |
|
|
239 |
|
|
|
(3,707 |
) |
Other current liabilities |
|
|
5,083 |
|
|
|
(2,860 |
) |
Income taxes payable |
|
|
260 |
|
|
|
12 |
|
Pension liabilities |
|
|
4,007 |
|
|
|
(17,745 |
) |
Other long-term liabilities |
|
|
(3,717 |
) |
|
|
(1,640 |
) |
Net cash provided by operating activities |
|
|
72,715 |
|
|
|
20,969 |
|
Cash flows from investing activities: |
|
|
|
|
||||
Proceeds from sale of business, net of cash on hand |
|
|
— |
|
|
|
1,200 |
|
Expenditures for property, plant & equipment |
|
|
(26,002 |
) |
|
|
(23,689 |
) |
Acquisition of businesses, net of cash acquired |
|
|
(1,487 |
) |
|
|
(441,340 |
) |
Investment in Near Earth Autonomy |
|
|
— |
|
|
|
(10,000 |
) |
Other, net |
|
|
(1,627 |
) |
|
|
778 |
|
Net cash used in investing activities |
|
|
(29,116 |
) |
|
|
(473,051 |
) |
Cash flows from financing activities: |
|
|
|
|
||||
Net (repayments) borrowings under revolving credit agreement |
|
|
(5,000 |
) |
|
|
363,000 |
|
Purchase of treasury shares |
|
|
(782 |
) |
|
|
(801 |
) |
Dividends paid |
|
|
(22,522 |
) |
|
|
(22,363 |
) |
Debt issuance costs |
|
|
(4,828 |
) |
|
|
(4,380 |
) |
Other, net |
|
|
260 |
|
|
|
467 |
|
Net cash (used in) provided by financing activities |
|
|
(32,872 |
) |
|
|
335,923 |
|
Net increase (decrease) in cash and cash equivalents |
|
|
10,727 |
|
|
|
(116,159 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
302 |
|
|
|
(487 |
) |
Cash and cash equivalents and restricted cash at beginning of period |
|
|
24,154 |
|
|
|
140,800 |
|
Cash and cash equivalents and restricted cash at end of period |
|
$ |
35,183 |
|
|
$ |
24,154 |
|
(1) The condensed consolidated statement of cash flows for the twelve-month fiscal period ended December 31, 2022 has been revised from amounts reported in the prior year to correct errors related to the accounting for certain labor costs at one business in the Precision Products segment and the net realizable value on certain portions of the Company's inventory at another business in the Structures segment. The correction of these errors impacted the amounts reported for net earnings, inventory and income tax refunds receivable. Refer to the Company's Form 10-K for the year ended December 31, 2023 for further information.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240221356903/en/
Investor Relations
(860) 243-7100
InvestorRelations@kaman.com
Source: Kaman Corp.
FAQ
What were Kaman Corp.'s net sales for Q4 2023 and FY 2023?
What is the merger agreement Kaman entered into?
What is the expected timeline for the merger with Arcline Investment Management, L.P.?
What was Kaman Corp.'s diluted earnings per share for Q4 2023 and FY 2023?
Why did Kaman Corp. not conduct a conference call for Q4 2023?
