Interface Reports Third Quarter 2023 Results
- None.
- None.
Third quarter highlights:
-
Net sales totaled
$311.0 million 5.1% year-over-year. -
Gross profit margin increased to
35.5% , up 226 basis points year-over-year. -
GAAP earnings per share of
$0.17 $0.28 -
Generated
$66.3 $30.6 million
“Our third quarter results reflect the resiliency of our global diversification strategy and effective execution in a relatively sluggish market. Net sales declined in the quarter primarily driven by an outsized impact from retail sector softness and broader macroeconomic uncertainty. This was partially offset by strength in healthcare, up
“We hit an important milestone in our One Interface journey with the global product launch of our Past Forward carpet tile collection, which was the first time we launched a global collection at the same time around the world. As we close out 2023, we remain focused on leveraging the power of our entire organization to drive profitable growth and value for our shareholders,” concluded Hurd.
“With strong cash flow from operations, debt repayment remains our top capital allocation priority. During the quarter we repaid
Third Quarter 2023 Financial Summary
Sales: Third quarter net sales were
Gross profit margin was
Third quarter SG&A expenses were
Operating Income: Third quarter operating income was
Net Income and EPS: On a GAAP basis, the Company recorded net income of
Adjusted EBITDA: In the third quarter of 2023, adjusted EBITDA was
First Nine Months of 2023 Summary
Sales: Net sales for the first nine months of 2023 were
Gross profit margin was
SG&A expenses for the first nine months of 2023 were
Operating Income: Operating income for the first nine months of 2023 was
Net Income and EPS: On a GAAP basis, the Company recorded net income of
Adjusted EBITDA: In the first nine months of 2023, adjusted EBITDA was
Cash and Debt: The Company had cash on hand of
Third Quarter Segment Results
AMS Results:
-
Q3 2023 net sales of
$178.2 million 8.4% versus$194.4 million -
Q3 2023 orders were down
4.2% compared to the prior year period on a currency neutral basis. -
Q3 2023 operating income was
$23.5 million $25.0 million -
Q3 2023 AOI was
$23.3 million $25.0 million
EAAA Results:
-
Q3 2023 net sales of
$132.8 million 0.4% versus$133.3 million -
Currency fluctuations had a
$5.3 million -
Q3 2023 orders were up
4.5% compared to the prior year period on a currency neutral basis. EMEA was up13.9% ,Australia was down4.8% , andAsia was down23.0% due primarily to continued softness in the region. -
Q3 2023 operating income of
$7.5 million $3.1 million -
Q3 2023 AOI was
$9.0 million $6.3 million
First Nine Months Segment Results
AMS Results:
-
Net sales for the first nine months of 2023 were
$548.7 million 1.6% versus$557.8 million -
Operating income for the first nine months of 2023 was
$57.0 million $74.6 million -
AOI for the first nine months of 2023 was
$58.6 million $74.5 million
EAAA Results:
-
Net sales for the first nine months of 2023 were
$387.7 million 4.2% versus$404.6 million -
Currency fluctuations had an approximately
$1.1 million U.S. dollar, partially offset by the strengthening of the Euro against theU.S. dollar. Excluding negative foreign currency impacts, for the first nine months of 2023, EAAA's net sales were down3.9% year-over-year. -
Operating income for the first nine months of 2023 was
$12.4 million $15.4 million -
AOI for the first nine months of 2023 was
$16.8 million $25.9 million
Outlook
Interface anticipates the following for the full fiscal year 2023:
-
Net sales of
$1.24 5 billion$1.26 5 billion -
Adjusted gross profit margin of approximately
34.4% . -
Adjusted SG&A expenses of approximately
$329 million -
Adjusted Interest & Other expenses of approximately
$35 million -
An adjusted effective tax rate of approximately
29.5% . - Fully diluted weighted average share count of approximately 58.3 million shares.
-
Capital expenditures of approximately
$32 million
Webcast and Conference Call Information
Interface will host a conference call on November 3, 2023, at 8:00 a.m. Eastern Time, to discuss its third quarter 2023 results. The conference call will be simultaneously broadcast live over the Internet.
Listeners may access the conference call live over the Internet at:
https://events.q4inc.com/attendee/413657327, or through the Company's website at: https://investors.interface.com.
The archived version of the webcast will be available at these sites for one year beginning approximately one hour after the call ends.
Non-GAAP Financial Measures
Interface provides adjusted earnings per share, adjusted net income, adjusted operating income ("AOI"), adjusted gross profit, adjusted gross profit margin, adjusted SG&A expenses, currency neutral sales and currency neutral sales growth, net debt, and adjusted EBITDA as additional information regarding its operating results in this press release. These non-GAAP measures are not in accordance with – or alternatives to – GAAP measures, and may be different from non-GAAP measures used by other companies. Adjusted EPS, adjusted net income, and AOI exclude nora purchase accounting amortization, the
About Interface
Interface, Inc., (NASDAQ: TILE) is a global flooring solutions enterprise with an integrated portfolio of carpet tile and resilient flooring products, where everything is third-party certified carbon neutral. With our design approach to flooring systems, we help our customers create high-performance interior spaces that have a positive impact on people’s lives and the planet. Our range includes Interface® carpet tile and LVT, nora® by Interface rubber flooring, and FLOR® premium area rugs for commercial and residential spaces.
Interface is third-party certified as a Carbon Neutral Enterprise. We neutralized our carbon impact across our entire business, including all operations and our full value chain, marking an important milestone toward our objective to become a restorative and carbon negative enterprise by 2040.
Learn more about Interface at interface.com and blog.interface.com, nora by Interface at nora.com, FLOR at FLOR.com, our sustainability journey at interface.com/sustainability, and our Carbon Neutral Enterprise certification at https://www.interface.com/US/en-US/sustainability/carbon-neutral-enterprise.html.
Follow us on Facebook, Instagram, LinkedIn, Twitter, and Pinterest.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995:
Except for historical information contained herein, the other matters set forth in this news release are forward-looking statements. Forward-looking statements may be identified by words such as “may,” “expect,” “forecast,” “anticipate,” “intend,” “plan,” “believe,” “could,” "should," "goal," "aim," "objective," “seek,” “project,” “estimate,” “target,” “will” and similar expressions. Forward-looking statements in this press release include, without limitation, any projections we make regarding the Company’s full year 2023 under “Outlook” above. The forward-looking statements set forth above involve a number of risks and uncertainties that could cause actual results to differ materially from any such statement, including but not limited to the risks under the following subheadings in “Risk Factors” in the Company's Annual Report on Form 10-K for the fiscal year ended January 1, 2023: "We compete with a large number of manufacturers in the highly competitive floorcovering products market, and some of these competitors have greater financial resources than we do. We may face challenges competing on price, making investments in our business, or competing on product design or sustainability", "Our earnings could be adversely affected by non-cash adjustments to goodwill, when a test of goodwill assets indicates a material impairment of those assets", "Our success depends significantly upon the efforts, abilities and continued service of our senior management executives, our principal design consultant and other key personnel (including experienced sales and manufacturing personnel), and our loss of any of them could affect us adversely", "Large increases in the cost of our raw materials, shipping costs, duties or tariffs could adversely affect us if we are unable to pass these cost increases through to our customers", "Unanticipated termination or interruption of any of our arrangements with our primary third-party suppliers of synthetic fiber or our primary third-party supplier for luxury vinyl tile (“LVT”) or other key raw materials could have a material adverse effect on us", "The market price of our common stock has been volatile and the value of your investment may decline", "Changes to our facilities, manufacturing processes, product construction, and product composition could disrupt our operations, increase our manufacturing costs, increase customer complaints, increase warranty claims, negatively affect our reputation, and have a material adverse effect on our financial condition and results of operations", "Our business operations could suffer significant losses from natural disasters, acts of war, terrorism, catastrophes, fire, adverse weather conditions, pandemics, endemics, unstable geopolitical situations or other unexpected events", "Disruptions to or failures of our information technology systems could adversely affect our business", "The impact of potential changes to environmental laws and regulations and industry standards regarding climate change could lead to unforeseen disruptions to our business operations", "The COVID-19 pandemic has had and could continue to have (and other public health emergencies could have in the future) a material adverse effect on our ability to operate, our ability to keep employees safe from the pandemic, our results of operations, financial condition, liquidity, capital investments, our near term and long term ability to stay in compliance with debt covenants under our Syndicated Credit Facility and Senior Notes, our ability to refinance our existing indebtedness, and our ability to obtain financing in capital markets", "Sales of our principal products have been and may continue to be affected by the COVID-19 pandemic, adverse economic cycles, and effects in the new construction market and renovation market", "Our substantial international operations are subject to various political, economic and other uncertainties that could adversely affect our business results, including foreign currency fluctuations, restrictive taxation, custom duties, border closings or other adverse government regulations", "The conflict between
Any forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995 and, as such, speak only as of the date made. The Company assumes no responsibility to update or revise forward-looking statements made in this press release and cautions readers not to place undue reliance on any such forward-looking statements.
- TABLES FOLLOW -
Consolidated Condensed Statements of Operations |
Three Months Ended |
|
Nine Months Ended |
||||||||||
(In thousands, except per share data) |
10/1/2023 |
|
10/2/2022 |
|
10/1/2023 |
|
10/2/2022 |
||||||
|
|
|
|
|
|
|
|
||||||
Net Sales |
$ |
311,006 |
|
$ |
327,757 |
|
|
$ |
936,380 |
|
|
$ |
962,364 |
Cost of Sales |
|
200,748 |
|
|
218,972 |
|
|
|
618,463 |
|
|
|
630,074 |
Gross Profit |
|
110,258 |
|
|
108,785 |
|
|
|
317,917 |
|
|
|
332,290 |
Selling, General & Administrative Expenses |
|
79,273 |
|
|
80,848 |
|
|
|
251,049 |
|
|
|
240,711 |
Restructuring, asset impairment, other (gains) and charges |
|
— |
|
|
(105 |
) |
|
|
(2,502 |
) |
|
|
1,592 |
Operating Income |
|
30,985 |
|
|
28,042 |
|
|
|
69,370 |
|
|
|
89,987 |
Interest Expense |
|
8,163 |
|
|
7,747 |
|
|
|
24,986 |
|
|
|
21,787 |
Other Expense, net |
|
6,702 |
|
|
124 |
|
|
|
7,674 |
|
|
|
1,688 |
Income Before Taxes |
|
16,120 |
|
|
20,171 |
|
|
|
36,710 |
|
|
|
66,512 |
Income Tax Expense |
|
6,241 |
|
|
6,106 |
|
|
|
11,748 |
|
|
|
22,336 |
Net Income |
$ |
9,879 |
|
$ |
14,065 |
|
|
$ |
24,962 |
|
|
$ |
44,176 |
|
|
|
|
|
|
|
|
||||||
Earnings Per Share – Basic |
$ |
0.17 |
|
$ |
0.24 |
|
|
$ |
0.43 |
|
|
$ |
0.75 |
|
|
|
|
|
|
|
|
||||||
Earnings Per Share – Diluted |
$ |
0.17 |
|
$ |
0.24 |
|
|
$ |
0.43 |
|
|
$ |
0.75 |
|
|
|
|
|
|
|
|
||||||
Common Shares Outstanding – Basic |
|
58,107 |
|
|
58,681 |
|
|
|
58,087 |
|
|
|
59,099 |
Common Shares Outstanding – Diluted |
|
58,342 |
|
|
58,681 |
|
|
|
58,233 |
|
|
|
59,099 |
|
|
|
|
|
|
|
|
||||||
Consolidated Condensed Balance Sheets |
|
|
|
||
(In thousands) |
10/1/2023 |
|
1/1/2023 |
||
Assets |
|
|
|
||
Cash |
$ |
119,633 |
|
$ |
97,564 |
Accounts Receivable |
|
143,884 |
|
|
182,807 |
Inventory |
|
289,320 |
|
|
306,327 |
Other Current Assets |
|
33,003 |
|
|
30,339 |
Total Current Assets |
|
585,840 |
|
|
617,037 |
Property, Plant & Equipment |
|
282,401 |
|
|
297,976 |
Operating Lease Right-of Use Asset |
|
75,604 |
|
|
81,644 |
Goodwill and Intangible Assets |
|
156,487 |
|
|
162,195 |
Other Assets |
|
101,309 |
|
|
107,651 |
Total Assets |
$ |
1,201,641 |
|
$ |
1,266,503 |
|
|
|
|
||
Liabilities |
|
|
|
||
Accounts Payable |
$ |
75,602 |
|
$ |
78,264 |
Accrued Liabilities |
|
115,266 |
|
|
120,138 |
Current Portion of Operating Lease Liabilities |
|
10,829 |
|
|
11,857 |
Current Portion of Long-Term Debt |
|
8,492 |
|
|
10,211 |
Total Current Liabilities |
|
210,189 |
|
|
220,470 |
Long-Term Debt |
|
435,899 |
|
|
510,003 |
Operating Lease Liabilities |
|
67,554 |
|
|
72,305 |
Other Long-Term Liabilities |
|
100,435 |
|
|
102,188 |
Total Liabilities |
|
814,077 |
|
|
904,966 |
Shareholders’ Equity |
|
387,564 |
|
|
361,537 |
Total Liabilities and Shareholders’ Equity |
$ |
1,201,641 |
|
$ |
1,266,503 |
Consolidated Condensed Statements of Cash Flows |
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
(In thousands) |
|
10/1/2023 |
|
10/2/2022 |
|
10/1/2023 |
|
10/2/2022 |
||||||||
OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
||||||||
Net Income |
|
$ |
9,879 |
|
|
$ |
14,065 |
|
|
$ |
24,962 |
|
|
$ |
44,176 |
|
Adjustments to Reconcile Net Income to Cash Provided by Operating Activities: |
|
|
|
|
|
|
|
|
||||||||
Depreciation and Amortization |
|
|
10,445 |
|
|
|
9,825 |
|
|
|
30,591 |
|
|
|
30,661 |
|
Share-Based Compensation Expense |
|
|
2,209 |
|
|
|
2,352 |
|
|
|
7,334 |
|
|
|
6,679 |
|
(Gain) Loss on Disposal of Property, Plant and Equipment, net |
|
|
10 |
|
|
|
— |
|
|
|
(2,531 |
) |
|
|
— |
|
Loss on Foreign Subsidiary Liquidation |
|
|
6,221 |
|
|
|
— |
|
|
|
6,221 |
|
|
|
— |
|
Amortization of Acquired Intangible Assets |
|
|
1,302 |
|
|
|
1,204 |
|
|
|
3,886 |
|
|
|
3,817 |
|
Deferred Income Taxes and Other Non-Cash Items |
|
|
(53 |
) |
|
|
4,675 |
|
|
|
(671 |
) |
|
|
13,616 |
|
Change in Working Capital |
|
|
|
|
|
|
|
|
||||||||
Accounts Receivable |
|
|
19,626 |
|
|
|
(1,078 |
) |
|
|
37,396 |
|
|
|
(8,860 |
) |
Inventories |
|
|
(5,808 |
) |
|
|
(8,261 |
) |
|
|
14,135 |
|
|
|
(71,487 |
) |
Prepaid Expenses and Other Current Assets |
|
|
769 |
|
|
|
8,017 |
|
|
|
(2,842 |
) |
|
|
2,321 |
|
Accounts Payable and Accrued Expenses |
|
|
21,693 |
|
|
|
(3,208 |
) |
|
|
(4,264 |
) |
|
|
(6,040 |
) |
Cash Provided by Operating Activities |
|
|
66,293 |
|
|
|
27,591 |
|
|
|
114,217 |
|
|
|
14,883 |
|
INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
||||||||
Capital Expenditures |
|
|
(5,907 |
) |
|
|
(4,187 |
) |
|
|
(17,238 |
) |
|
|
(13,314 |
) |
Proceeds from Sale of Property, Plant and Equipment |
|
|
— |
|
|
|
— |
|
|
|
6,593 |
|
|
|
— |
|
Cash Used in Investing Activities |
|
|
(5,907 |
) |
|
|
(4,187 |
) |
|
|
(10,645 |
) |
|
|
(13,314 |
) |
FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
||||||||
Repayments of Long-term Debt |
|
|
(37,631 |
) |
|
|
(71,980 |
) |
|
|
(149,738 |
) |
|
|
(151,662 |
) |
Borrowing of Long-term Debt |
|
|
7,000 |
|
|
|
49,986 |
|
|
|
74,000 |
|
|
|
159,363 |
|
Tax Withholding Payments for Share-Based Compensation |
|
|
(27 |
) |
|
|
— |
|
|
|
(1,514 |
) |
|
|
(398 |
) |
Repurchase of Common Stock |
|
|
— |
|
|
|
(8,869 |
) |
|
|
— |
|
|
|
(14,451 |
) |
Dividends Paid |
|
|
(581 |
) |
|
|
(586 |
) |
|
|
(1,742 |
) |
|
|
(1,773 |
) |
Finance Lease Payments |
|
|
(545 |
) |
|
|
(525 |
) |
|
|
(1,853 |
) |
|
|
(1,535 |
) |
Cash Used in Financing Activities |
|
|
(31,784 |
) |
|
|
(31,974 |
) |
|
|
(80,847 |
) |
|
|
(10,456 |
) |
Net Cash Provided by (Used in) Operating, Investing and Financing Activities |
|
|
28,602 |
|
|
|
(8,570 |
) |
|
|
22,725 |
|
|
|
(8,887 |
) |
Effect of Exchange Rate Changes on Cash |
|
|
(1,904 |
) |
|
|
(3,634 |
) |
|
|
(656 |
) |
|
|
(8,916 |
) |
CASH AND CASH EQUIVALENTS |
|
|
|
|
|
|
|
|
||||||||
Net Change During the Period |
|
|
26,698 |
|
|
|
(12,204 |
) |
|
|
22,069 |
|
|
|
(17,803 |
) |
Balance at Beginning of Period |
|
|
92,935 |
|
|
|
91,653 |
|
|
|
97,564 |
|
|
|
97,252 |
|
Balance at End of Period |
|
$ |
119,633 |
|
|
$ |
79,449 |
|
|
$ |
119,633 |
|
|
$ |
79,449 |
|
Segment Results |
|||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||
(in thousands) |
10/1/2023 |
|
10/2/2022 |
|
10/1/2023 |
|
10/2/2022 |
||||
Net Sales |
|
|
|
|
|
|
|
||||
AMS |
$ |
178,194 |
|
$ |
194,449 |
|
$ |
548,716 |
|
$ |
557,768 |
EAAA |
|
132,812 |
|
|
133,308 |
|
|
387,664 |
|
|
404,596 |
Consolidated Net Sales |
$ |
311,006 |
|
$ |
327,757 |
|
$ |
936,380 |
|
$ |
962,364 |
|
|
|
|
|
|
|
|
||||
Segment AOI |
|
|
|
|
|
|
|
||||
AMS |
$ |
23,318 |
|
$ |
24,975 |
|
$ |
58,621 |
|
$ |
74,502 |
EAAA |
|
9,049 |
|
|
6,273 |
|
|
16,805 |
|
|
25,908 |
Consolidated AOI |
$ |
32,367 |
|
$ |
31,248 |
|
$ |
75,426 |
|
$ |
100,410 |
|
|
|
|
|
|
|
|
||||
* Note: Segment AOI includes allocation of corporate SG&A expenses |
|
|
|
|
|||||||
Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures (In millions, except per share amounts) |
|||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
Third Quarter 2023 |
|
Third Quarter 2022 |
||||||||||||||||||||||||||||||||||||
|
|
|
|
Adjustments |
|
|
|
|
|
|
Adjustments |
|
|
||||||||||||||||||||||||||
|
Gross
|
SG&A |
Operating
|
Pre-tax |
Tax
|
Net
|
Diluted EPS |
|
Gross
|
SG&A |
Operating
|
Pre-tax |
Tax
|
Net
|
Diluted
|
||||||||||||||||||||||||
GAAP As Reported |
$ |
110.3 |
$ |
79.3 |
|
$ |
31.0 |
|
|
$ |
9.9 |
$ |
0.17 |
|
$ |
108.8 |
$ |
80.8 |
|
$ |
28.0 |
|
|
$ |
14.1 |
$ |
0.24 |
||||||||||||
Non-GAAP Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Purchase Accounting Amortization |
|
1.3 |
|
— |
|
|
1.3 |
1.3 |
(0.4 |
) |
|
0.9 |
|
0.02 |
|
|
1.2 |
|
— |
|
|
1.2 |
1.2 |
(0.4 |
) |
|
0.9 |
|
0.01 |
||||||||||
Thailand Plant Closure Inventory Write-down |
|
— |
|
— |
|
|
— |
— |
— |
|
|
— |
|
— |
|
|
0.5 |
|
— |
|
|
0.5 |
0.5 |
— |
|
|
0.5 |
|
0.01 |
||||||||||
Restructuring, Asset Impairment, Severance, and Other, net |
|
— |
|
— |
|
|
— |
— |
0.2 |
|
|
0.2 |
|
— |
|
|
— |
|
(1.6 |
) |
|
1.5 |
1.5 |
— |
|
|
1.5 |
|
0.03 |
||||||||||
Cyber Event |
|
— |
|
(0.1 |
) |
|
0.1 |
0.1 |
— |
|
|
0.1 |
|
— |
|
|
— |
|
— |
|
|
— |
— |
— |
|
|
— |
|
— |
||||||||||
Loss on Foreign Subsidiary Liquidation (1) |
|
— |
|
— |
|
|
— |
6.2 |
(1.1 |
) |
|
5.1 |
|
0.09 |
|
|
— |
|
— |
|
|
— |
— |
— |
|
|
— |
|
— |
||||||||||
Loss on Discontinuance of Interest Rate Swaps |
|
— |
|
— |
|
|
— |
0.2 |
— |
|
|
0.1 |
|
— |
|
|
— |
|
— |
|
|
— |
0.6 |
(0.2 |
) |
|
0.5 |
|
0.01 |
||||||||||
Adjustments Subtotal * |
|
1.3 |
|
(0.1 |
) |
|
1.4 |
7.8 |
(1.3 |
) |
|
6.5 |
|
0.11 |
|
|
1.7 |
|
(1.6 |
) |
|
3.2 |
3.9 |
(0.5 |
) |
|
3.3 |
|
0.06 |
||||||||||
Adjusted (non-GAAP) * |
$ |
111.6 |
$ |
79.2 |
|
$ |
32.4 |
|
|
$ |
16.4 |
$ |
0.28 |
|
$ |
110.5 |
$ |
79.2 |
|
$ |
31.2 |
|
|
$ |
17.4 |
$ |
0.30 |
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(1) |
|||||||||||||||||||||||||||||||||||||||
* Note: Sum of reconciling items may differ from total due to rounding of individual components |
|||||||||||||||||||||||||||||||||||||||
|
First Nine Months 2023 |
|
First Nine Months 2022 |
||||||||||||||||||||||||||||||||||||
|
|
|
|
Adjustments |
|
|
|
|
|
|
Adjustments |
|
|
||||||||||||||||||||||||||
|
Gross
|
SG&A |
Operating
|
Pre-tax |
Tax
|
Net
|
Diluted
|
|
Gross
|
SG&A |
Operating
|
Pre-tax |
Tax
|
Net
|
Diluted
|
||||||||||||||||||||||||
GAAP As Reported |
$ |
317.9 |
$ |
251.0 |
|
$ |
69.4 |
|
|
$ |
25.0 |
|
$ |
0.43 |
|
|
$ |
332.3 |
$ |
240.7 |
|
$ |
90.0 |
|
|
$ |
44.2 |
$ |
0.75 |
||||||||||
Non-GAAP Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Purchase Accounting Amortization |
|
3.9 |
|
— |
|
|
3.9 |
3.9 |
|
(1.1 |
) |
|
2.8 |
|
|
0.05 |
|
|
|
3.8 |
|
— |
|
|
3.8 |
3.8 |
(1.1 |
) |
|
2.7 |
|
0.05 |
|||||||
Thailand Plant Closure Inventory Write-down |
|
— |
|
— |
|
|
— |
— |
|
— |
|
|
— |
|
|
— |
|
|
|
2.5 |
|
— |
|
|
2.5 |
2.5 |
— |
|
|
2.5 |
|
0.04 |
|||||||
Restructuring, Asset Impairment, Severance, and Other, net |
|
— |
|
(3.7 |
) |
|
1.2 |
1.2 |
|
(0.4 |
) |
|
0.8 |
|
|
0.01 |
|
|
|
— |
|
(2.5 |
) |
|
4.1 |
4.1 |
0.0 |
|
|
4.1 |
|
0.07 |
|||||||
Property Casualty Loss(1) |
|
— |
|
— |
|
|
— |
(0.5 |
) |
0.1 |
|
|
(0.4 |
) |
|
(0.01 |
) |
|
|
— |
|
— |
|
|
— |
— |
— |
|
|
— |
|
— |
|||||||
Cyber Event |
|
— |
|
(1.0 |
) |
|
1.0 |
1.0 |
|
(0.2 |
) |
|
0.7 |
|
|
0.01 |
|
|
|
— |
|
— |
|
|
— |
— |
— |
|
|
— |
|
— |
|||||||
Loss on Foreign Subsidiary Liquidation (2) |
|
— |
|
— |
|
|
— |
6.2 |
|
(1.1 |
) |
|
5.1 |
|
|
0.09 |
|
|
|
— |
|
— |
|
|
— |
— |
— |
|
|
— |
|
— |
|||||||
Loss on Discontinuance of Interest Rate Swaps |
|
— |
|
— |
|
|
— |
1.0 |
|
(0.2 |
) |
|
0.7 |
|
|
0.01 |
|
|
|
— |
|
— |
|
|
— |
2.4 |
(0.6 |
) |
|
1.8 |
|
0.03 |
|||||||
Adjustments Subtotal * |
|
3.8 |
|
(4.7 |
) |
|
6.1 |
12.8 |
|
(2.9 |
) |
|
9.8 |
|
|
0.17 |
|
|
|
6.3 |
|
(2.5 |
) |
|
10.4 |
12.8 |
(1.7 |
) |
|
11.1 |
|
0.19 |
|||||||
Adjusted (non-GAAP) * |
$ |
321.8 |
$ |
246.3 |
|
$ |
75.4 |
|
|
$ |
34.8 |
|
$ |
0.60 |
|
|
$ |
338.6 |
$ |
238.2 |
|
$ |
100.4 |
|
|
$ |
55.3 |
$ |
0.94 |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
(1) Represents insurance recovery net of loss recognized in the first quarter of 2023. |
|||||||||||||||||||||||||||||||||||||||
(2) |
|||||||||||||||||||||||||||||||||||||||
* Note: Sum of reconciling items may differ from total due to rounding of individual components |
|||||||||||||||||||||||||||||||||||||||
Reconciliation of Segment GAAP Financial Measures to Non-GAAP Financial Measures ("Currency Neutral Net Sales") (In millions) |
||||||||||||||||||
|
Third Quarter 2023 |
|
Third Quarter 2022 |
|||||||||||||||
|
AMS
|
EAAA
|
Consolidated * |
|
AMS
|
EAAA
|
Consolidated * |
|||||||||||
Net Sales as Reported (GAAP) |
$ |
178.2 |
$ |
132.8 |
|
$ |
311.0 |
|
|
$ |
194.4 |
$ |
133.3 |
$ |
327.8 |
|||
Impact of Changes in Currency |
|
0.4 |
|
(5.3 |
) |
|
(4.9 |
) |
|
|
— |
|
— |
|
— |
|||
Currency Neutral Net Sales * |
$ |
178.6 |
$ |
127.5 |
|
$ |
306.1 |
|
|
$ |
194.4 |
$ |
133.3 |
$ |
327.8 |
|||
|
|
|
|
|
|
|
|
|||||||||||
* Note: Sum of reconciling items may differ from total due to rounding of individual components |
||||||||||||||||||
|
First Nine Months 2023 |
|
First Nine Months 2022 |
|||||||||||||||
|
AMS
|
EAAA
|
Consolidated * |
|
AMS
|
EAAA
|
Consolidated * |
|||||||||||
Net Sales as Reported (GAAP) |
$ |
548.7 |
$ |
387.7 |
$ |
936.4 |
|
$ |
557.8 |
$ |
404.6 |
$ |
962.4 |
|||||
Impact of Changes in Currency |
|
2.1 |
|
1.1 |
|
3.1 |
|
|
— |
|
— |
|
— |
|||||
Currency Neutral Net Sales * |
$ |
550.8 |
$ |
388.8 |
$ |
939.5 |
|
$ |
557.8 |
$ |
404.6 |
$ |
962.4 |
|||||
|
|
|
|
|
|
|
|
|||||||||||
* Note: Sum of reconciling items may differ from total due to rounding of individual components |
||||||||||||||||||
Reconciliation of GAAP Operating Income to Adjusted Operating Income ("AOI") (In millions) |
||||||||||||||||
|
Third Quarter 2023 |
|
Third Quarter 2022 |
|
||||||||||||
|
AMS
|
EAAA
|
Consolidated * |
|
AMS
|
EAAA
|
Consolidated * |
|
||||||||
GAAP Operating Income |
$ |
23.5 |
|
$ |
7.5 |
$ |
31.0 |
|
$ |
25.0 |
$ |
3.1 |
$ |
28.0 |
|
|
Non-GAAP Adjustments: |
|
|
|
|
|
|
|
|
||||||||
Purchase Accounting Amortization |
|
— |
|
|
1.3 |
|
1.3 |
|
|
— |
|
1.2 |
|
1.2 |
|
|
Thailand Plant Closure Inventory Write-down |
|
— |
|
|
— |
|
— |
|
|
— |
|
0.5 |
|
0.5 |
|
|
Restructuring, Asset Impairment, Severance, and Other, net |
|
(0.3 |
) |
|
0.3 |
|
— |
|
|
— |
|
1.5 |
|
1.5 |
|
|
Cyber Event |
|
0.1 |
|
|
— |
|
0.1 |
|
|
— |
|
— |
|
— |
|
|
Adjustments Subtotal * |
|
(0.2 |
) |
|
1.6 |
|
1.4 |
|
|
— |
|
3.2 |
|
3.2 |
|
|
AOI * |
$ |
23.3 |
|
$ |
9.0 |
$ |
32.4 |
|
$ |
25.0 |
$ |
6.3 |
$ |
31.2 |
|
|
|
|
|
|
|
|
|
|
|
||||||||
* Note: Sum of reconciling items may differ from total due to rounding of individual components |
|
|
|
|
|
|||||||||||
|
First Nine Months 2023 |
|
First Nine Months 2022 |
|||||||||||||
|
AMS
|
EAAA
|
Consolidated * |
|
AMS
|
EAAA
|
Consolidated * |
|||||||||
GAAP Operating Income |
$ |
57.0 |
$ |
12.4 |
$ |
69.4 |
|
$ |
74.6 |
|
$ |
15.4 |
$ |
90.0 |
||
Non-GAAP Adjustments: |
|
|
|
|
|
|
|
|||||||||
Purchase Accounting Amortization |
|
— |
|
3.9 |
|
3.9 |
|
|
— |
|
|
3.8 |
|
3.8 |
||
Thailand Plant Closure Inventory Write-down |
|
— |
|
— |
|
— |
|
|
— |
|
|
2.5 |
|
2.5 |
||
Restructuring, Asset Impairment, Severance, and Other, net |
|
1.1 |
|
0.1 |
|
1.2 |
|
|
(0.1 |
) |
|
4.2 |
|
4.1 |
||
Cyber Event |
|
0.6 |
|
0.4 |
|
1.0 |
|
|
— |
|
|
— |
|
— |
||
Adjustments Subtotal * |
|
1.6 |
|
4.4 |
|
6.1 |
|
|
(0.1 |
) |
|
10.5 |
|
10.4 |
||
AOI * |
$ |
58.6 |
$ |
16.8 |
$ |
75.4 |
|
$ |
74.5 |
|
$ |
25.9 |
$ |
100.4 |
||
|
|
|
|
|
|
|
|
|||||||||
* Note: Sum of reconciling items may differ from total due to rounding of individual components |
|
|
|
|
||||||||||||
|
Third Quarter
|
|
Third Quarter
|
|
First Nine Months
|
|
First Nine
|
|
Last Twelve
|
|
Fiscal Year
|
|
|||||||||
Net Income as Reported (GAAP) |
$ |
9.9 |
|
|
$ |
14.1 |
|
$ |
25.0 |
|
|
$ |
44.2 |
|
$ |
0.3 |
|
|
$ |
19.6 |
|
Income Tax Expense |
|
6.2 |
|
|
|
6.1 |
|
|
11.7 |
|
|
|
22.3 |
|
|
11.8 |
|
|
|
22.4 |
|
Interest Expense (including debt issuance cost amortization) |
|
8.2 |
|
|
|
7.7 |
|
|
25.0 |
|
|
|
21.8 |
|
|
33.1 |
|
|
|
29.9 |
|
Depreciation and Amortization (excluding debt issuance cost amortization) |
|
9.6 |
|
|
|
9.4 |
|
|
29.0 |
|
|
|
29.4 |
|
|
38.3 |
|
|
|
38.7 |
|
Share-Based Compensation Expense |
|
2.2 |
|
|
|
2.4 |
|
|
7.3 |
|
|
|
6.7 |
|
|
9.2 |
|
|
|
8.5 |
|
Purchase Accounting Amortization |
|
1.3 |
|
|
|
1.2 |
|
|
3.9 |
|
|
|
3.8 |
|
|
5.1 |
|
|
|
5.0 |
|
Goodwill and Intangible Asset Impairment |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
36.2 |
|
|
|
36.2 |
|
Thailand Plant Closure Inventory Write-down |
|
— |
|
|
|
0.5 |
|
|
— |
|
|
|
2.5 |
|
|
— |
|
|
|
2.5 |
|
Restructuring, Asset Impairment, Severance, and Other, net |
|
— |
|
|
|
1.5 |
|
|
1.2 |
|
|
|
4.1 |
|
|
5.3 |
|
|
|
8.2 |
|
Property Casualty Loss(1) |
|
— |
|
|
|
— |
|
|
(0.5 |
) |
|
|
— |
|
|
(0.5 |
) |
|
|
— |
|
Cyber Event |
|
0.1 |
|
|
|
— |
|
|
1.0 |
|
|
|
— |
|
|
6.1 |
|
|
|
5.1 |
|
Loss on Foreign Subsidiary Liquidation (2) |
|
6.2 |
|
|
|
— |
|
|
6.2 |
|
|
|
— |
|
|
6.2 |
|
|
|
— |
|
Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (AEBITDA)* |
$ |
43.7 |
|
|
$ |
42.9 |
|
$ |
109.8 |
|
|
$ |
134.8 |
|
$ |
151.1 |
|
|
$ |
176.1 |
|
(1) Represents insurance recovery net of loss recognized in the first quarter of 2023. |
|
||||||||||||||||||||
(2) |
|
||||||||||||||||||||
* Note: Sum of reconciling items may differ from total due to rounding of individual components |
|
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
As of 10/1/23 |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total Debt |
$ |
444.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total Cash on Hand |
|
(119.6 |
) |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Total Debt, Net of Cash on Hand (Net Debt)* |
$ |
324.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
10/1/2023 |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Total Debt / LTM Net Income |
1284.4x |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Net Debt / LTM AEBITDA |
2.1x |
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
* Note: Sum of reconciling items may differ from total due to rounding of individual components |
|
||||||||||||||||||||
|
|||||||||||||||||||||
The impacts of changes in foreign currency presented in the tables are calculated based on applying the prior year period's average foreign currency exchange rates to the current year period.
The Company believes that the above non-GAAP performance measures, which management uses in managing and evaluating the Company’s business, may provide users of the Company’s financial information with additional meaningful basis for comparing the Company’s current results and results in a prior period, as these measures reflect factors that are unique to one period relative to the comparable period. However, these non‑GAAP performance measures should be viewed in addition to, and not as an alternative for, the Company’s reported results under accounting principles generally accepted in
View source version on businesswire.com: https://www.businesswire.com/news/home/20231103991253/en/
Media Contact:
Christine Needles
Global Corporate Communications
Christine.Needles@interface.com
+1 404-491-4660
Investor Contact:
Bruce Hausmann
Chief Financial Officer
Bruce.Hausmann@interface.com
+1 770-437-6802
Source: Interface, Inc.
FAQ
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