TRIUMPH'S FOURTH QUARTER FISCAL 2022 RESULTS DEMONSTRATE IMPROVING PROFITABILITY AND CASH FLOW; PROVIDES FISCAL 2023 GUIDANCE
TRIUMPH reported its fourth quarter and fiscal year 2022 results, noting net sales of $386.7 million in Q4 and $1.5 billion for the year. Fiscal 2022 net loss was $42.8 million or ($0.66) per share, while adjusted net income was $51.8 million. Operating income for Q4 was $38.8 million, with an operating margin of 10%. For fiscal 2023, sales are guided between $1.2 billion and $1.3 billion with earnings per share of $0.40 to $0.60. The company reported a backlog of $1.42 billion, indicating growth prospects.
- Net sales guided between $1.2 billion - $1.3 billion for fiscal 2023.
- Adjusted net income of $25.6 million or $0.39 per diluted share in Q4.
- Backlog increased by 6% to $1.42 billion, primarily due to commercial narrow body platforms.
- Operating margin improved to 10% in Q4.
- Net loss of $10.6 million in Q4, reflecting ongoing financial challenges.
- Fiscal 2022 cash used in operations of $137 million, indicating cash flow issues.
- Operating income decreased to $104.3 million for the full year, with an operating margin of only 7%.
BERWYN, Pa., May 18, 2022 /PRNewswire/ -- Triumph Group, Inc. (NYSE: TGI) ("TRIUMPH" or the "Company") today reported financial results for its fourth quarter and fiscal 2022, which ended March 31, 2022.
- Net sales of
$386.7 million - Operating income of
$38.8 million with operating margin of10% ; adjusted operating income of$43.0 million with adjusted operating margin of11% - Net loss of
$10.6 million , or ($0.16) per share; adjusted net income of$25.6 million , or$0.39 per diluted share - Cash flow provided by operations of
$33.0 million ; free cash flow of$29.1 million
- Net sales of
$1.5 billion - Operating income of
$104.3 million with operating margin of7% ; adjusted operating income of$135.0 million with adjusted operating margin of9% - Net loss of
$42.8 million , or ($0.66) per share; adjusted net income of$51.8 million , or$0.79 per diluted share - Cash flow used in operations of
$137.0 million ; free cash use of$156.7 million
- Net sales between
$1.2 billion -$1.3 billion - Earnings per diluted share of between
$0.40 -$0.60 - Cash used in operations of (
$30.0) million to ($40.0) million , includes core cash flow from operations of between$30.0 million -$45.0 million
"TRIUMPH continued to deliver improving operating margin and cash flow, both sequentially and year over year, thanks to our talented and dedicated global team." stated Dan Crowley, TRIUMPH's chairman, president and chief executive officer. "We are pleased to provide financial outlook for fiscal 2023 powered by the diversity of our people, our highly engineered products, and the programs and markets we serve. With a growing and profitable backlog, TRIUMPH is well positioned to benefit from continued strength in military and freighter markets and the anticipated recovery in commercial aviation production and aftermarket demand over the next several years."
"Mr. Crowley continued, "During fiscal 2022 we completed several important milestones including divesting our build to print metallic structures businesses, completing 747 production and streamlining our organizational structure to reduce cost and enhance communication and efficiencies. In fiscal 2023 we will expand our investment in operations, products and people to maximize value for all stakeholders."
Excluding divestitures and sunsetting programs, sales for the fourth quarter of fiscal 2022 were down
Fourth quarter operating income of
TRIUMPH's results included the following:
($ millions except EPS) | Pre-tax | After-tax | Diluted EPS | |||||||||
Loss from Continuing Operations - GAAP | $ | (9.8) | $ | (10.6) | $ | (0.16) | ||||||
Gain on sale of assets and businesses, net | (4.3) | (4.3) | (0.07) | |||||||||
Restructuring costs (cash) | 6.3 | 6.3 | 0.10 | |||||||||
Restructuring costs (non-cash) | 2.3 | 2.3 | 0.04 | |||||||||
Pension charges | 32.0 | 32.0 | 0.49 | |||||||||
Adjusted Income from Continuing Operations - non-GAAP * | $ | 26.4 | $ | 25.6 | $ | 0.39 | ||||||
* Differences due to rounding |
The number of shares used in computing diluted earnings per share for the fourth quarter of 2022 was 65.4 million.
Adjusting for the pending Stuart divestiture, backlog, which represents the next 24 months of actual purchase orders with firm delivery dates or contract requirements, was
For the fourth quarter of fiscal 2022, cash flow provided by operations was
The Company's outlook reflects adjustments detailed in the attached tables and assumes a first quarter of fiscal 2023 closure on our Stuart facility divestiture and the resolution of the related customer advances.
Based on anticipated aircraft production rates, the Company expects net sales for fiscal 2023 will be approximately
The Company expects GAAP fiscal 2023 earnings per diluted share of
The Company expects fiscal 2023 cash used in operations of (
TRIUMPH will hold a conference call today, May 18th, at 8:30 a.m. (ET) to discuss the fourth quarter of fiscal 2022 results. The conference call will be available live and archived on the Company's website at http://www.triumphgroup.com. A slide presentation will be included with the audio portion of the webcast, and the presentation has been posted on the Company's website at http://ir.triumphgroup.com/QuarterlyResults. An audio replay will be available from May 18th to May 25th by calling (877) 344-7529 (Domestic) or (412) 317-0088 (International), passcode #5049523.
TRIUMPH, headquartered in Berwyn, Pennsylvania, designs, engineers, manufactures, repairs and overhauls a broad portfolio of aerospace and defense systems, components and structures. The company serves the global aviation industry, including original equipment manufacturers and the full spectrum of military and commercial aircraft operators.
More information about TRIUMPH can be found on the Company's website at www.triumphgroup.com.
Statements in this release which are not historical facts are forward-looking statements under the provisions of the Private Securities Litigation Reform Act of 1995, including statements of expectations of or assumptions about financial and operational performance, revenues, earnings per share, cash flow or use, cost savings and operational efficiencies and organizational restructurings. All forward-looking statements involve risks and uncertainties which could affect the Company's actual results and could cause its actual results to differ materially from those expressed in any forward-looking statements made by, or on behalf of, the Company. Further information regarding the important factors that could cause actual results to differ from projected results can be found in Triumph Group's reports filed with the SEC, including our Annual Report on Form 10-K for the fiscal year ended March 31, 2021.
Widespread health developments, including the recent global coronavirus (COVID-19), and the responses thereto (such as voluntary and in some cases, mandatory quarantines as well as shut downs and other restrictions on travel and commercial, social and other activities) could adversely and materially affect, among other things, the economic and financial markets and labor resources of the countries in which we operate, our manufacturing and supply chain operations, commercial operations and sales force, administrative personnel, third-party service providers, business partners and customers and the demand for our products, which could result in a material adverse effect on our business, financial conditions and results of operations.
FINANCIAL DATA (UNAUDITED) | ||||||||||||||||
TRIUMPH GROUP, INC. AND SUBSIDIARIES | ||||||||||||||||
(in thousands, except per share data) | ||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||
March 31, | March 31, | |||||||||||||||
CONDENSED STATEMENTS OF OPERATIONS | 2022 | 2021 | 2022 | 2021 | ||||||||||||
Net sales | $ | 386,651 | $ | 466,833 | $ | 1,459,942 | $ | 1,869,719 | ||||||||
Cost of sales (excluding depreciation shown below) | 284,722 | 359,598 | 1,073,063 | 1,476,266 | ||||||||||||
Selling, general & administrative | 49,295 | 53,773 | 202,070 | 215,962 | ||||||||||||
Depreciation & amortization | 9,600 | 20,515 | 49,635 | 93,334 | ||||||||||||
Impairment of long-lived assets and goodwill | 2,308 | — | 2,308 | 252,382 | ||||||||||||
Restructuring costs | 6,264 | 20,477 | 19,295 | 53,224 | ||||||||||||
(Gain) loss on sale of assets and businesses, net | (4,335) | 58,682 | 9,294 | 104,702 | ||||||||||||
Operating income (loss) | 38,797 | (46,212) | 104,277 | (326,151) | ||||||||||||
Interest expense and other, net | 30,801 | 39,053 | 135,861 | 171,397 | ||||||||||||
Debt extinguishment loss | — | — | 11,624 | — | ||||||||||||
Non-service defined benefit expense (income) | 17,754 | (12,244) | (5,373) | (49,519) | ||||||||||||
Income tax expense | 817 | 498 | 4,923 | 2,881 | ||||||||||||
Net loss | $ | (10,575) | $ | (73,519) | $ | (42,758) | $ | (450,910) | ||||||||
Loss per share - basic: | ||||||||||||||||
Net loss | $ | (0.16) | $ | (1.27) | $ | (0.66) | $ | (8.55) | ||||||||
Weighted average common shares outstanding - basic | 64,640 | 57,920 | 64,538 | 52,739 | ||||||||||||
Loss per share - diluted: | ||||||||||||||||
Net loss | $ | (0.16) | $ | (1.27) | $ | (0.66) | $ | (8.55) | ||||||||
Weighted average common shares outstanding - diluted | 64,640 | 57,920 | 64,538 | 52,739 | ||||||||||||
Dividends declared and paid per common share | $ | — | $ | — | $ | — | $ | — | ||||||||
(Continued)
FINANCIAL DATA (UNAUDITED) | ||||||||
TRIUMPH GROUP, INC. AND SUBSIDIARIES | ||||||||
(dollars in thousands, except share data) | ||||||||
BALANCE SHEETS | Unaudited | Audited | ||||||
Assets | ||||||||
Cash and cash equivalents | $ | 240,878 | $ | 589,882 | ||||
Accounts receivable, net | 178,663 | 194,066 | ||||||
Contract assets | 101,828 | 134,638 | ||||||
Inventory, net | 361,692 | 400,366 | ||||||
Prepaid and other current assets | 19,437 | 19,206 | ||||||
Assets held for sale | 60,104 | 216,276 | ||||||
Current assets | 962,602 | 1,554,434 | ||||||
Property and equipment, net | 169,050 | 211,369 | ||||||
Goodwill | 513,722 | 521,638 | ||||||
Intangible assets, net | 84,850 | 102,453 | ||||||
Other, net | 30,476 | 61,041 | ||||||
Total assets | $ | 1,760,700 | $ | 2,450,935 | ||||
Liabilities & Stockholders' Deficit | ||||||||
Current portion of long-term debt | $ | 3,268 | $ | 5,247 | ||||
Accounts payable | 161,534 | 179,473 | ||||||
Contract liabilities | 171,763 | 204,379 | ||||||
Accrued expenses | 207,420 | 271,160 | ||||||
Liabilities related to assets held for sale | 57,519 | 58,108 | ||||||
Current liabilities | 601,504 | 718,367 | ||||||
Long-term debt, less current portion | 1,586,222 | 1,952,296 | ||||||
Accrued pension and post-retirement benefits, noncurrent | 301,303 | 384,256 | ||||||
Deferred income taxes, noncurrent | 7,386 | 7,491 | ||||||
Other noncurrent liabilities | 51,708 | 207,378 | ||||||
Stockholders' Deficit: | ||||||||
Common stock, $.001 par value, 100,000,000 shares authorized, | 64 | 64 | ||||||
Capital in excess of par value | 973,112 | 978,272 | ||||||
Treasury stock, at cost, 14,897 and 303,673 shares | (96) | (12,606) | ||||||
Accumulated other comprehensive loss | (463,354) | (530,192) | ||||||
Accumulated deficit | (1,297,149) | (1,254,391) | ||||||
Total stockholders' deficit | (787,423) | (818,853) | ||||||
Total liabilities and stockholders' deficit | $ | 1,760,700 | $ | 2,450,935 | ||||
(Continued)
FINANCIAL DATA (UNAUDITED) | ||||||||
TRIUMPH GROUP, INC. AND SUBSIDIARIES | ||||||||
(dollars in thousands, except share data) | ||||||||
Fiscal Year Ended March 31 | ||||||||
2022 | 2021 | |||||||
Operating Activities | ||||||||
Net loss | $ | (42,758) | $ | (450,910) | ||||
Adjustments to reconcile net loss to net cash used in | ||||||||
Depreciation and amortization | 49,635 | 93,334 | ||||||
Impairment of long-lived assets | 2,308 | 252,382 | ||||||
Amortization of acquired contract liability | (5,870) | (38,564) | ||||||
Loss on sale of assets and businesses | 9,294 | 104,702 | ||||||
Curtailments, settlements, and special termination benefits loss, net | 52,005 | — | ||||||
Other amortization included in interest expense | 9,047 | 23,759 | ||||||
Provision for credit losses | 452 | 4,853 | ||||||
Provision (benefit) for deferred income taxes | 25 | (176) | ||||||
Share-based compensation | 9,782 | 12,701 | ||||||
Changes in other assets and liabilities, excluding the effects of | ||||||||
Trade and other receivables | 2,822 | 126,294 | ||||||
Contract assets | 702 | 46,841 | ||||||
Inventories | 25,642 | 35,412 | ||||||
Prepaid expenses and other current assets | (1,122) | (310) | ||||||
Accounts payable, accrued expenses, and contract liabilities | (189,412) | (330,992) | ||||||
Accrued pension and other postretirement benefits | (58,597) | (51,692) | ||||||
Other, net | (971) | (753) | ||||||
Net cash used in operating activities | (137,016) | (173,119) | ||||||
Investing Activities | ||||||||
Capital expenditures | (19,660) | (25,178) | ||||||
Proceeds from sale of assets and businesses | 224,518 | 15,888 | ||||||
Investment in joint venture | (2,101) | — | ||||||
Purchase of facility related to divested businesses | (21,550) | — | ||||||
Net cash provided by (used in) investing activities | 181,207 | (9,290) | ||||||
Financing Activities | ||||||||
Net decrease in revolving credit facility | — | (400,000) | ||||||
Proceeds from issuance of long-term debt | 107 | 713,900 | ||||||
Retirement of debt and finance lease obligations | (380,009) | (160,035) | ||||||
Payment of deferred financing costs | (400) | (20,716) | ||||||
Sales of common stock | — | 145,383 | ||||||
Premium on redemption of First Lien Notes | (9,108) | — | ||||||
Repurchase of shares for share-based compensation | (3,249) | (1,285) | ||||||
Net cash (used in) provided by financing activities | (392,659) | 277,247 | ||||||
Effect of exchange rate changes on cash | (536) | 9,581 | ||||||
Net change in cash and cash equivalents | (349,004) | 104,419 | ||||||
Cash and cash equivalents at beginning of period | 589,882 | 485,463 | ||||||
Cash and cash equivalents at end of period | $ | 240,878 | $ | 589,882 | ||||
(Continued)
FINANCIAL DATA (UNAUDITED) | ||||||||||||||||
TRIUMPH GROUP, INC. AND SUBSIDIARIES | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||
Three Months Ended | Year Ended | |||||||||||||||
March 31, | March 31, | |||||||||||||||
SEGMENT DATA | 2022 | 2021 | 2022 | 2021 | ||||||||||||
Net sales: | ||||||||||||||||
Systems & Support | $ | 286,969 | $ | 301,823 | $ | 1,030,444 | $ | 1,060,001 | ||||||||
Aerospace Structures | 99,684 | 165,306 | 429,547 | 814,371 | ||||||||||||
Elimination of inter-segment sales | (2) | (296) | (49) | (4,653) | ||||||||||||
$ | 386,651 | $ | 466,833 | $ | 1,459,942 | $ | 1,869,719 | |||||||||
Operating income (loss): | ||||||||||||||||
Systems & Support | $ | 49,237 | $ | 39,484 | $ | 163,450 | $ | 113,517 | ||||||||
Aerospace Structures | 2,666 | (13,515) | 13,982 | (267,702) | ||||||||||||
Corporate | (10,988) | (68,566) | (63,373) | (159,265) | ||||||||||||
Share-based compensation expense | (2,118) | (3,615) | (9,782) | (12,701) | ||||||||||||
$ | 38,797 | $ | (46,212) | $ | 104,277 | $ | (326,151) | |||||||||
Operating margin % | ||||||||||||||||
Systems & Support | 17.2 | % | 13.1 | % | 15.9 | % | 10.7 | % | ||||||||
Aerospace Structures | 2.7 | % | (8.2) | % | 3.3 | % | (32.9) | % | ||||||||
Consolidated | 10.0 | % | (9.9) | % | 7.1 | % | (17.4) | % | ||||||||
Depreciation and amortization^: | ||||||||||||||||
Systems & Support | $ | 7,699 | $ | 8,719 | $ | 32,464 | $ | 33,549 | ||||||||
Aerospace Structures | 3,556 | 10,989 | 16,234 | 308,708 | ||||||||||||
Corporate | 653 | 807 | 3,245 | 3,459 | ||||||||||||
$ | 11,908 | $ | 20,515 | $ | 51,943 | $ | 345,716 | |||||||||
Amortization of acquired contract liabilities: | ||||||||||||||||
Systems & Support | $ | (2,226) | $ | (3,493) | $ | (5,859) | $ | (15,062) | ||||||||
Aerospace Structures | — | (54) | (12) | (23,502) | ||||||||||||
$ | (2,226) | $ | (3,547) | $ | (5,871) | $ | (38,564) | |||||||||
^ includes impairment of long-lived assets | ||||||||||||||||
(dollars in thousands)
We prepare and publicly release quarterly unaudited financial statements prepared in accordance with GAAP. In accordance with Securities and Exchange Commission (the "SEC") guidance on Compliance and Disclosure Interpretations, we also disclose and discuss certain non-GAAP financial measures in our public releases. Currently, the non-GAAP financial measure that we disclose is Adjusted EBITDA and Adjusted EBITDAP, which is our net income before interest, income taxes, amortization of acquired contract liabilities, curtailments, settlements and special termination benefits, legal settlements, loss on divestitures, share-based compensation expense, depreciation and amortization and Adjusted EBITDA, less pension & other postretirement benefits. We disclose Adjusted EBITDA and Adjusted EBITDAP on a consolidated and Adjusted EBITDAP an operating segment basis in our earnings releases, investor conference calls and filings with the SEC. The non-GAAP financial measures that we use may not be comparable to similarly titled measures reported by other companies. Also, in the future, we may disclose different non-GAAP financial measures in order to help our investors more meaningfully evaluate and compare our future results of operations to our previously reported results of operations.
We view Adjusted EBITDA and Adjusted EBITDAP as operating performance measure and as such we believe that the GAAP financial measure most directly comparable to it is net income. In calculating Adjusted EBITDA and Adjusted EBITDAP, we exclude from net income the financial items that we believe should be separately identified to provide additional analysis of the financial components of the day-to-day operation of our business. We have outlined below the type and scope of these exclusions and the material limitations on the use of these non-GAAP financial measures as a result of these exclusions. Adjusted EBITDA and Adjusted EBITDAP are not measurements of financial performance under GAAP and should not be considered as a measure of liquidity, as an alternative to net income (loss), income from continuing operations, or as an indicator of any other measure of performance derived in accordance with GAAP. Investors and potential investors in our securities should not rely on Adjusted EBITDA or Adjusted EBITDAP as substitutes for any GAAP financial measure, including net income (loss) or income from continuing operations. In addition, we urge investors and potential investors in our securities to carefully review the reconciliation of Adjusted EBITDA and Adjusted EBITDAP to net income set forth below, in our earnings releases and in other filings with the SEC and to carefully review the GAAP financial information included as part of our Quarterly Reports on Form 10-Q and our Annual Reports on Form 10-K that are filed with the SEC, as well as our quarterly earnings releases, and compare the GAAP financial information with our Adjusted EBITDA and Adjusted EBITDAP.
Adjusted EBITDA and Adjusted EBITDAP is used by management to internally measure our operating and management performance and by investors as a supplemental financial measure to evaluate the performance of our business that, when viewed with our GAAP results and the accompanying reconciliation, we believe provides additional information that is useful to gain an understanding of the factors and trends affecting our business. We have spent more than 25 years expanding our product and service capabilities partially through acquisitions of complementary businesses. Due to the expansion of our operations, which included acquisitions, our net income has included significant charges for depreciation and amortization. Adjusted EBITDA and Adjusted EBITDAP exclude these charges and provide meaningful information about the operating performance of our business, apart from charges for depreciation and amortization. We believe the disclosure of Adjusted EBITDA and Adjusted EBITDAP helps investors meaningfully evaluate and compare our performance from quarter to quarter and from year to year. We also believe Adjusted EBITDA and Adjusted EBITDAP is a measure of our ongoing operating performance because the isolation of non-cash income and expenses, such as amortization of acquired contract liabilities, depreciation and amortization, share-based compensation and non-operating items, such as interest and income taxes, provides additional information about our cost structure, and, over time, helps track our operating progress. In addition, investors, securities analysts and others have regularly relied on Adjusted EBITDA and Adjusted EBITDAP to provide a financial measure by which to compare our operating performance against that of other companies in our industry.
(Continued)
(dollars in thousands)
Set forth below are descriptions of the financial items that have been excluded from our net income to calculate Adjusted EBITDA and Adjusted EBITDAP and the material limitations associated with using this non-GAAP financial measure as compared to net income:
- Divestitures may be useful for investors to consider because they reflect gains or losses from sale of operating units. We do not believe these earnings necessarily reflect the current and ongoing cash earnings related to our operations.
- Non-service defined benefit income (inclusive of certain pension related transactions such as curtailments, settlements, early retirement or other incentives) may be useful to investors to consider because they represent the cost of post-retirement benefits to plan participants, net of the assumption of returns on the plan's assets and are not indicative of the cash paid for such benefits. We do not believe these earnings (expenses) necessarily reflect the current and ongoing cash earnings related to our operations.
- Amortization of acquired contract liabilities may be useful for investors to consider because it represents the non-cash earnings on the fair value of below market contracts acquired through acquisitions. We do not believe these earnings necessarily reflect the current and ongoing cash earnings related to our operations.
- Amortization expense and nonrecurring asset impairments (including goodwill, intangible asset impairments, and nonrecurring rotable inventory impairments) may be useful for investors to consider because it represents the estimated attrition of our acquired customer base and the diminishing value of tradenames, product rights, licenses, or, in the case of goodwill, other assets that are not individually identified and separately recognized under U.S. GAAP, or, in the case of nonrecurring asset impairments, the impact of unusual and nonrecurring events affecting the estimated recoverability of existing assets. We do not believe these charges necessarily reflect the current and ongoing cash charges related to our operating cost structure,
- Share-based compensation may be useful for investors to consider because it represents a portion of the total compensation to management and the board of directors. We do not believe these charges necessarily reflect the current and ongoing cash charges related to our operating cost structure.
- Depreciation may be useful for investors to consider because they generally represent the wear and tear on our property and equipment used in our operations. We do not believe these charges necessarily reflect the current and ongoing cash charges related to our operating cost structure.
- The amount of interest expense and other we incur may be useful for investors to consider and may result in current cash inflows or outflows. However, we do not consider the amount of interest expense and other to be a representative component of the day-to-day operating performance of our business.
- Income tax expense may be useful for investors to consider because it generally represents the taxes which may be payable for the period and the change in deferred income taxes during the period and may reduce the amount of funds otherwise available for use in our business. However, we do not consider the amount of income tax expense to be a representative component of the day-to-day operating performance of our business.
Management compensates for the above-described limitations of using non-GAAP measures by using a non-GAAP measure only to supplement our GAAP results and to provide additional information that is useful to gain an understanding of the factors and trends affecting our business.
(Continued)
(dollars in thousands)
The following table shows our Adjusted EBITDA and Adjusted EBITDAP reconciled to our net income for the indicated periods (in thousands):
Three Months Ended | Year Ended | |||||||||||||||
March 31, | March 31, | |||||||||||||||
Adjusted Earnings before Interest, Taxes, Depreciation, | 2022 | 2021 | 2022 | 2021 | ||||||||||||
Net loss | $ | (10,575) | $ | (73,519) | $ | (42,758) | $ | (450,910) | ||||||||
Add-back: | ||||||||||||||||
Income tax expense | 817 | 498 | 4,923 | 2,881 | ||||||||||||
Interest expense and other, net | 30,801 | 39,053 | 135,861 | 171,397 | ||||||||||||
Debt extinguishment loss | — | — | 11,624 | — | ||||||||||||
Pension charges | 31,959 | — | 52,005 | — | ||||||||||||
(Gain) loss on sales of assets and businesses, net | (4,335) | 58,682 | 9,294 | 104,702 | ||||||||||||
Impairment of rotable inventory | — | — | — | 23,689 | ||||||||||||
Amortization of acquired contract liabilities | (2,226) | (3,547) | (5,871) | (38,564) | ||||||||||||
Depreciation and amortization ^ | 11,908 | 20,515 | 51,943 | 345,716 | ||||||||||||
Adjusted Earnings before Interest, Taxes, Depreciation | $ | 58,349 | $ | 41,682 | $ | 217,021 | $ | 158,911 | ||||||||
Non-service defined benefit income (excluding settlements) | (14,205) | (12,244) | (57,378) | (49,519) | ||||||||||||
Adjusted Earnings before Interest, Taxes, Depreciation | 44,144 | 29,438 | 159,643 | 109,392 | ||||||||||||
Share-based compensation | 2,118 | 3,615 | 9,782 | 12,701 | ||||||||||||
Adjusted Earnings before Interest, Taxes, Depreciation | $ | 46,262 | $ | 33,053 | $ | 169,425 | $ | 122,093 | ||||||||
Net sales | $ | 386,651 | $ | 466,833 | $ | 1,459,942 | $ | 1,869,719 | ||||||||
Net loss margin | (2.7) | % | (15.7) | % | (2.9) | % | (24.1) | % | ||||||||
Adjusted EBITDAP margin, as historically presented | 11.5 | % | 6.4 | % | 11.0 | % | 6.0 | % | ||||||||
Adjusted EBITDAP margin | 12.0 | % | 7.1 | % | 11.7 | % | 6.7 | % | ||||||||
^ includes long-lived asset impairment charges | ||||||||||||||||
FINANCIAL DATA (UNAUDITED) | ||||||||||||||||
TRIUMPH GROUP, INC. AND SUBSIDIARIES | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||
Non-GAAP Financial Measure Disclosures (continued) | ||||||||||||||||
Three Months Ended March 31, 2022 | ||||||||||||||||
Segment Data | ||||||||||||||||
Adjusted Earnings before Interest, Taxes, Depreciation, | Total | Systems & | Aerospace | Corporate/ | ||||||||||||
Net loss | $ | (10,575) | ||||||||||||||
Add-back: | ||||||||||||||||
Non-service defined benefit expense | 17,754 | |||||||||||||||
Income tax expense | 817 | |||||||||||||||
Interest expense and other, net | 30,801 | |||||||||||||||
Operating income (loss) | $ | 38,797 | $ | 49,237 | $ | 2,666 | $ | (13,106) | ||||||||
Gain on sales of assets & businesses, net | (4,335) | — | — | (4,335) | ||||||||||||
Amortization of acquired contract liabilities | (2,226) | (2,226) | — | — | ||||||||||||
Depreciation and amortization | 11,908 | 7,699 | 3,556 | 653 | ||||||||||||
Adjusted Earnings (Losses) before Interest, Taxes, | $ | 44,144 | $ | 54,710 | $ | 6,222 | $ | (16,788) | ||||||||
Share-based compensation | 2,118 | $ | — | $ | — | $ | 2,118 | |||||||||
Adjusted Earnings (Losses) before Interest, Taxes, | $ | 46,262 | $ | 54,710 | $ | 6,222 | $ | (14,670) | ||||||||
Net sales | $ | 386,651 | $ | 286,969 | $ | 99,684 | $ | (2) | ||||||||
Adjusted EBITDAP margin, as historically presented | 11.5 | % | 19.2 | % | 6.2 | % | n/a | |||||||||
Adjusted EBITDAP margin | 12.0 | % | 19.2 | % | 6.2 | % | n/a | |||||||||
Year Ended March 31, 2022 | ||||||||||||||||
Segment Data | ||||||||||||||||
Adjusted Earnings before Interest, Taxes, Depreciation, | Total | Systems & | Aerospace | Corporate/ | ||||||||||||
Net loss | $ | (42,758) | ||||||||||||||
Add-back: | ||||||||||||||||
Non-service defined benefit income | (5,373) | |||||||||||||||
Income tax expense | 4,923 | |||||||||||||||
Debt extinguishment loss | 11,624 | |||||||||||||||
Interest expense and other, net | 135,861 | |||||||||||||||
Operating income (loss) | $ | 104,277 | $ | 163,450 | $ | 13,982 | $ | (73,155) | ||||||||
Loss on sales of assets & businesses, net | 9,294 | — | — | 9,294 | ||||||||||||
Amortization of acquired contract liabilities | (5,871) | (5,859) | (12) | — | ||||||||||||
Depreciation and amortization | 51,943 | 32,464 | 16,234 | 3,245 | ||||||||||||
Adjusted Earnings (Losses) before Interest, Taxes, | $ | 159,643 | $ | 190,055 | $ | 30,204 | $ | (60,616) | ||||||||
Share-based compensation | 9,782 | $ | — | $ | — | $ | 9,782 | |||||||||
Adjusted Earnings (Losses) before Interest, Taxes, | $ | 169,425 | $ | 190,055 | $ | 30,204 | $ | (50,834) | ||||||||
Net sales | $ | 1,459,942 | $ | 1,030,444 | $ | 429,547 | $ | (49) | ||||||||
Adjusted EBITDAP margin, as historically presented | 11.0 | % | 18.5 | % | 7.0 | % | n/a | |||||||||
Adjusted EBITDAP margin | 11.7 | % | 18.5 | % | 7.0 | % | n/a | |||||||||
* | Operating loss at Corporate includes share-based compensation expense. |
(Continued)
FINANCIAL DATA (UNAUDITED) | ||||||||||||||||
TRIUMPH GROUP, INC. AND SUBSIDIARIES | ||||||||||||||||
(dollars in thousands) | ||||||||||||||||
Non-GAAP Financial Measure Disclosures (continued) | ||||||||||||||||
Three Months Ended March 31, 2021 | ||||||||||||||||
Segment Data | ||||||||||||||||
Adjusted Earnings before Interest, Taxes, Depreciation, | Total | Systems & | Aerospace | Corporate/ | ||||||||||||
Net loss | $ | (73,519) | ||||||||||||||
Add-back: | ||||||||||||||||
Non-service defined benefit income | (12,244) | |||||||||||||||
Income tax expense | 498 | |||||||||||||||
Interest expense and other, net | 39,053 | |||||||||||||||
Operating income (loss) | $ | (46,212) | $ | 39,484 | $ | (13,515) | $ | (72,181) | ||||||||
Loss on sales of assets & businesses, net | 58,682 | — | — | 58,682 | ||||||||||||
Amortization of acquired contract liabilities | (3,547) | (3,493) | (54) | — | ||||||||||||
Depreciation and amortization | 20,515 | 8,719 | 10,989 | 807 | ||||||||||||
Adjusted Earnings (Losses) before Interest, Taxes, | $ | 29,438 | $ | 44,710 | $ | (2,580) | $ | (12,692) | ||||||||
Share-based compensation | 3,615 | $ | — | $ | — | $ | 3,615 | |||||||||
Adjusted Earnings (Losses) before Interest, Taxes, | $ | 33,053 | $ | 44,710 | $ | (2,580) | $ | (9,077) | ||||||||
Net sales | $ | 466,833 | $ | 301,823 | $ | 165,306 | $ | (296) | ||||||||
Adjusted EBITDAP margin, as historically presented | 6.4 | % | 15.0 | % | (1.6) | % | n/a | |||||||||
Adjusted EBITDAP margin | 7.1 | % | 15.0 | % | (1.6) | % | n/a | |||||||||
Year Ended March 31, 2021 | ||||||||||||||||
Segment Data | ||||||||||||||||
Adjusted Earnings before Interest, Taxes, Depreciation, | Total | Systems & | Aerospace | Corporate/ | ||||||||||||
Net loss | $ | (450,910) | ||||||||||||||
Add-back: | ||||||||||||||||
Non-service defined benefit income | (49,519) | |||||||||||||||
Income tax expense | 2,881 | |||||||||||||||
Interest expense and other, net | 171,397 | |||||||||||||||
Operating income (loss) | $ | (326,151) | $ | 113,517 | $ | (267,702) | $ | (171,966) | ||||||||
Loss on sales of assets & businesses, net | 104,702 | — | — | 104,702 | ||||||||||||
Amortization of acquired contract liabilities | (38,564) | (15,062) | (23,502) | — | ||||||||||||
Impairment of rotable inventory | 23,689 | 23,689 | — | — | ||||||||||||
Depreciation and amortization ^ | 345,716 | 33,549 | 308,708 | 3,459 | ||||||||||||
Adjusted Earnings (Losses) before Interest, Taxes, | $ | 109,392 | $ | 155,693 | $ | 17,504 | $ | (63,805) | ||||||||
Share-based compensation | 12,701 | — | — | 12,701 | ||||||||||||
Adjusted Earnings (Losses) before Interest, Taxes, | $ | 122,093 | $ | 155,693 | $ | 17,504 | $ | (51,104) | ||||||||
Net sales | $ | 1,869,719 | $ | 1,060,001 | $ | 814,371 | $ | (4,653) | ||||||||
Adjusted EBITDAP margin, as historically presented | 6.0 | % | 14.9 | % | 2.2 | % | n/a | |||||||||
Adjusted EBITDAP margin | 6.7 | % | 14.9 | % | 2.2 | % | n/a | |||||||||
^ includes long-lived asset impairment charge in the first quarter of fiscal 2021 | ||||||||||||||||
(Continued)
(dollars in thousands, except per share data)
Adjusted income from continuing operations, before income taxes, adjusted income from continuing operations and adjusted income from continuing operations per diluted share, before non-recurring costs have been provided for consistency and comparability. These measures should not be considered in isolation or as alternatives to income from continuing operations before income taxes, income from continuing operations and income from continuing operations per diluted share presented in accordance with GAAP. The following tables reconcile income from continuing operations before income taxes, income from continuing operations, and income from continuing operations per diluted share, before non-recurring costs.
Three Months Ended | ||||||||||||
Pre-Tax | After-Tax | Diluted EPS | ||||||||||
Loss from continuing operations - GAAP | $ | (9,758) | $ | (10,575) | $ | (0.16) | ||||||
Adjustments: | ||||||||||||
Gain on sale of assets and businesses, net | (4,335) | (4,335) | (0.07) | |||||||||
Restructuring costs (cash based) | 6,264 | 6,264 | 0.10 | |||||||||
Restructuring costs (non-cash - accelerated depreciation) | 2,308 | 2,308 | 0.04 | |||||||||
Pension charges | 31,959 | 31,959 | 0.49 | |||||||||
Adjusted income from continuing operations - non-GAAP* | $ | 26,438 | $ | 25,621 | $ | 0.39 | ||||||
* Differences due to rounding | ||||||||||||
Year Ended | ||||||||||||
Pre-Tax | After-Tax | Diluted EPS | ||||||||||
Loss from continuing operations - GAAP | $ | (37,835) | $ | (42,758) | $ | (0.66) | ||||||
Adjustments: | ||||||||||||
Loss on sale of assets and businesses, net | 9,294 | 9,294 | 0.14 | |||||||||
Restructuring costs (cash based) | 19,295 | 19,295 | 0.30 | |||||||||
Restructuring costs (non-cash - long-lived asset impairment) | 2,308 | 2,308 | 0.04 | |||||||||
Pension charges | 52,005 | 52,005 | 0.80 | |||||||||
Debt extinguishment loss | 11,624 | 11,624 | 0.18 | |||||||||
Adjusted income from continuing operations - non-GAAP* | $ | 56,691 | $ | 51,768 | $ | 0.79 | ||||||
* Differences due to rounding | ||||||||||||
Three Months Ended | ||||||||||||
Pre-Tax | After-Tax | Diluted EPS | ||||||||||
Loss from continuing operations - GAAP | $ | (73,021) | $ | (73,519) | $ | (1.27) | ||||||
Adjustments: | ||||||||||||
Loss on sale of assets and businesses, net | 58,682 | 58,682 | 1.00 | |||||||||
Restructuring costs | 20,477 | 20,477 | 0.35 | |||||||||
Adjusted income from continuing operations - non-GAAP* | $ | 6,138 | $ | 5,640 | 0.10 | |||||||
* Differences due to rounding | ||||||||||||
(Continued)
(dollars in thousands, except per share data)
Year Ended | ||||||||||||
Pre-Tax | After-Tax | Diluted EPS | ||||||||||
Loss from continuing operations - GAAP | $ | (448,029) | $ | (450,910) | $ | (8.55) | ||||||
Adjustments: | ||||||||||||
Loss on sale of assets and businesses, net | 104,702 | 104,702 | 1.99 | |||||||||
Impairment of long-lived assets | 252,382 | 252,382 | 4.79 | |||||||||
Impairment of rotable assets | 23,689 | 23,689 | 0.45 | |||||||||
Restructuring costs | 53,224 | 53,224 | 1.01 | |||||||||
Refinancing costs | 15,305 | 15,305 | 0.29 | |||||||||
Adjusted income from continuing operations - non-GAAP* | $ | 1,273 | $ | (1,608) | $ | (0.03) | ||||||
* Differences due to rounding | ||||||||||||
Adjusted Operating Income is defined as GAAP Operating Income, less expenses/gains associated with the Company's transformation, such as restructuring expenses, gains/losses on divestitures, impairments of goodwill and other assets. Management believes that this is useful in evaluating operating performance, but this measure should not be used in isolation. The following table reconciles our Operating income to Adjusted Operating income as noted above.
Three Months Ended | Year Ended | |||||||||||||||
2022 | 2021 | 2022 | 2021 | |||||||||||||
Operating income (loss) - GAAP | $ | 38,797 | $ | (46,212) | $ | 104,277 | $ | (326,151) | ||||||||
Adjustments: | ||||||||||||||||
(Gain) loss on sale of assets and businesses, net | (4,335) | 58,682 | 9,294 | 104,702 | ||||||||||||
Impairment of long-lived assets | 2,308 | — | 2,308 | 252,382 | ||||||||||||
Impairment of rotable inventory | — | — | — | 23,689 | ||||||||||||
Restructuring costs (cash and non-cash) | 6,264 | 20,477 | 19,295 | 53,224 | ||||||||||||
Adjusted operating income - non-GAAP | $ | 43,034 | $ | 32,947 | $ | 135,174 | $ | 107,846 | ||||||||
Cash provided by operations, is provided for consistency and comparability. We also use free cash flow as a key factor in planning for and consideration of strategic acquisitions and the repayment of debt. This measure should not be considered in isolation, as a measure of residual cash flow available for discretionary purposes, or as an alternative to operating results presented in accordance with GAAP. The following table reconciles cash provided by operations to free cash flow.
Three Months Ended | Fiscal Year Ended | ||||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||||
Cash provided by (used in) operating activities | $ | 32,965 | $ | 22,752 | $ | (137,016) | $ | (173,119) | |||||||||
Less: | |||||||||||||||||
Capital expenditures | (3,843) | (6,190) | (19,660) | (25,178) | |||||||||||||
Free cash flow (use) | $ | 29,122 | $ | 16,562 | $ | (156,676) | $ | (198,297) | |||||||||
(Continued)
(dollars in thousands, except per share data)
Fiscal 2023 outlook includes cash used in operations, core cash from operations and core free cash flow. We use core cash from operations and core free cash flow to measure performance of our continuing operations. The following table reconciles cash used in operations to core cash flow from operations and core free cash flow.
Fiscal Year 2023 | ||||||||||||
($ in millions) | ||||||||||||
Cash used in operations | $ | (40.0) | - | $ | (30.0) | |||||||
Less: | ||||||||||||
Non-core cash use^ | $ | (70.0) | - | $ | (75.0) | |||||||
Core cash provided by operations | $ | 30.0 | - | $ | 45.0 | |||||||
Less: | ||||||||||||
Capital expenditures | $ | (30.0) | - | $ | (30.0) | |||||||
Core free cash flow | $ | — | - | $ | 15.0 | |||||||
Excludes: | ||||||||||||
Liquidation of customer advances | ~ | |||||||||||
^ Non-core cash use estimate includes remaining cash related to the exit or sale of legacy structures facilities and programs.
View original content:https://www.prnewswire.com/news-releases/triumphs-fourth-quarter-fiscal-2022-results-demonstrate-improving-profitability-and-cash-flow-provides-fiscal-2023-guidance-301549768.html
SOURCE Triumph Group
FAQ
What were Triumph Group's Q4 2022 results for TGI?
What is Triumph Group's guidance for fiscal 2023?
How did Triumph Group perform in fiscal 2022?
What is the current backlog for Triumph Group?
