Gorman-Rupp Reports Fourth Quarter and Full-Year 2023 Financial Results
Fourth Quarter 2023 Highlights
-
Net sales of
$160.6 million increased 10.0%, or$14.6 million , compared to the fourth quarter of 2022 -
Fourth quarter net income was
$9.0 million , or$0.34 per share, compared to net income of$2.4 million , or$0.09 per share, for the fourth quarter of 2022-
Adjusted earnings per share1 for the fourth quarter of 2023 and 2022 were
$0.34 and$0.11 , respectively -
Adjusted earnings per share1 included non-cash LIFO expense of
$0.01 per share and$0.25 per share in 2023 and 2022, respectively
-
Adjusted earnings per share1 for the fourth quarter of 2023 and 2022 were
-
Adjusted EBITDA1 of
$29.1 million for the fourth quarter of 2023 increased$0.6 million , or 2.1%, from$28.5 million for the same period in 2022
Net sales for the fourth quarter of 2023 were
Sales increased
Gross profit was
Selling, general and administrative (“SG&A”) expenses were
Amortization expense was
Operating income was
Interest expense was
Net income was
Adjusted EBITDA1 was
Full-Year 2023 Highlights
As previously announced, on
-
Net sales of
$659.5 million increased 26.6%, or$138.5 million , compared to 2022, a 15.8% increase excluding Fill-Rite -
Net income was
$35.0 million , or$1.34 per share, compared to net income of$11.2 million , or$0.43 per share, in 2022-
Adjusted earnings per share1 for 2023 and 2022 were
$1.37 and$0.94 , respectively
-
Adjusted earnings per share1 for 2023 and 2022 were
-
Adjusted EBITDA1 of
$121.7 million for 2023 increased$33.0 million , or 37.1%, from$88.7 million in 2022 -
Total debt, net of cash, decreased
$58.2 million during 2023
Net sales for 2023 of
Sales increased
Gross profit was
Selling, general and administrative (“SG&A”) expenses were
Amortization expense was
Operating income was
Interest expense was
Other income (expense), net was
Net income was
Adjusted EBITDA1 was
The Company’s backlog of orders was
Net cash provided by operating activities in 2023 was
“I am grateful for
About
Founded in 1933,
(1) Non-GAAP Information
This release includes certain non-GAAP financial data and measures such as adjusted earnings, adjusted earnings per share, and adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”). Adjusted earnings is earnings excluding non-cash pension settlement charges, one-time acquisition costs, amortization of step up in value of acquired inventories, and amortization of customer backlog. Adjusted earnings per share is earnings per share excluding non-cash pension settlement charges per share, one-time acquisition costs per share, amortization of step up in value of acquired inventories per share, and amortization of customer backlog per share. Adjusted earnings before interest, taxes, depreciation and amortization is net income (loss) excluding interest, taxes, depreciation and amortization, adjusted to exclude non-cash pension settlement charges, one-time acquisition costs, amortization of step up in value of acquired inventories, amortization of customer backlog, and non-cash LIFO2 expense. Management utilizes these adjusted financial data and measures to assess comparative operations against those of prior periods without the distortion of non-comparable factors. The inclusion of these adjusted measures should not be construed as an indication that the Company’s future results will be unaffected by unusual or infrequent items or that the items for which the Company has made adjustments are unusual or infrequent or will not recur. Further, the impact of the LIFO2 inventory costing method can cause results to vary substantially from company to company depending upon whether they elect to utilize LIFO2 and depending upon which method they may elect.
(2) LIFO Inventory Method
The majority of the Company’s inventories are valued on the last-in, first-out (LIFO) method and stated at the lower of cost or market. Current cost approximates replacement cost, or market, and LIFO cost is determined at the end of each fiscal year based on inventory levels on-hand at current replacement cost and a LIFO reserve. The Company uses the simplified LIFO method, under which the LIFO reserve is determined utilizing the inflation factor specified in the Producer Price Index for Machinery and Equipment – Pumps, Compressors and Equipment, as published by the
Forward-Looking Statements
In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995,
|
|||||||||||||||
Condensed Consolidated Statements of Income (Unaudited) | |||||||||||||||
(thousands of dollars, except per share data) | |||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||||||
Net sales |
$ |
160,565 |
|
$ |
146,001 |
|
$ |
659,511 |
|
$ |
521,027 |
|
|||
Cost of products sold |
|
109,628 |
|
|
109,363 |
|
|
463,258 |
|
|
390,090 |
|
|||
Gross profit |
|
50,937 |
|
|
36,638 |
|
|
196,253 |
|
|
130,937 |
|
|||
Selling, general and administrative expenses |
|
25,996 |
|
|
20,992 |
|
|
96,660 |
|
|
83,117 |
|
|||
Amortization expense |
|
3,153 |
|
|
3,139 |
|
|
12,552 |
|
|
7,637 |
|
|||
Operating income |
|
21,788 |
|
|
12,507 |
|
|
87,041 |
|
|
40,183 |
|
|||
Interest expense |
|
(10,126 |
) |
|
(9,361 |
) |
|
(41,273 |
) |
|
(19,240 |
) |
|||
Other income (expense), net |
|
(422 |
) |
|
7 |
|
|
(1,807 |
) |
|
(7,071 |
) |
|||
Income before income taxes |
|
11,240 |
|
|
3,153 |
|
|
43,961 |
|
|
13,872 |
|
|||
Provision from income taxes |
|
2,264 |
|
|
726 |
|
|
9,010 |
|
|
2,677 |
|
|||
Net income |
$ |
8,976 |
|
$ |
2,427 |
|
$ |
34,951 |
|
$ |
11,195 |
|
|||
Earnings per share |
$ |
0.34 |
|
$ |
0.09 |
|
$ |
1.34 |
|
$ |
0.43 |
|
|||
|
|||||||
Condensed Consolidated Balance Sheets (Unaudited) | |||||||
(thousands of dollars, except share data) | |||||||
|
|||||||
Assets |
2023 |
|
2022 |
||||
Cash and cash equivalents | $ |
30,518 |
$ |
6,783 |
|||
Accounts receivable, net |
89,625 |
|
93,059 |
||||
Inventories, net |
104,156 |
|
111,133 |
||||
Prepaid and other |
11,812 |
|
14,551 |
||||
Total current assets |
236,111 |
|
225,526 |
||||
Property, plant and equipment, net |
134,872 |
|
128,640 |
||||
Other assets |
24,841 |
|
11,579 |
||||
|
494,534 |
|
507,085 |
||||
Total assets | $ |
890,358 |
$ |
872,830 |
|||
Liabilities and shareholders' equity | |||||||
Accounts payable | $ |
23,277 |
$ |
24,697 |
|||
Current portion of long-term debt |
21,875 |
|
17,500 |
||||
Accrued liabilities and expenses |
55,524 |
|
43,016 |
||||
Total current liabilities |
100,676 |
|
85,213 |
||||
Pension benefits |
11,500 |
|
9,352 |
||||
Postretirement benefits |
22,786 |
|
22,413 |
||||
Long-term debt, net of current portion |
382,579 |
|
419,327 |
||||
Other long-term liabilities |
23,358 |
|
5,331 |
||||
Total liabilities |
540,899 |
|
541,636 |
||||
Shareholders' equity |
349,459 |
|
331,194 |
||||
Total liabilities and shareholders' equity | $ |
890,358 |
$ |
872,830 |
|||
Shares outstanding |
26,193,998 |
|
26,094,865 |
|
|||||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) |
|||||||||
(thousands of dollars, except share data) |
|||||||||
Year Ended |
|||||||||
2023 |
2022 |
||||||||
Cash flows from operating activities: | |||||||||
Net income |
$ |
34,951 |
|
$ |
11,195 |
|
|||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||
Depreciation and amortization |
|
28,496 |
|
|
21,158 |
|
|||
LIFO expense |
|
6,891 |
|
|
18,041 |
|
|||
Pension expense |
|
3,604 |
|
|
9,985 |
|
|||
Contributions to pension plan |
|
(2,250 |
) |
|
(2,250 |
) |
|||
Stock based compensation |
|
3,252 |
|
|
2,957 |
|
|||
Amortization of debt issuance fees |
|
3,014 |
|
|
1,717 |
|
|||
Deferred income tax charge (benefit) |
|
(414 |
) |
|
(1,086 |
) |
|||
Other |
|
1,335 |
|
|
(128 |
) |
|||
Changes in operating assets and liabilities: | |||||||||
Accounts receivable, net |
|
3,752 |
|
|
(13,954 |
) |
|||
Inventories, net |
|
559 |
|
|
(32,772 |
) |
|||
Accounts payable |
|
(1,518 |
) |
|
(2,250 |
) |
|||
Commissions payable |
|
9 |
|
|
2,051 |
|
|||
Deferred revenue and customer deposits |
|
5,773 |
|
|
(2,329 |
) |
|||
Income taxes |
|
1,226 |
|
|
1,907 |
|
|||
Accrued expenses and other |
|
6,316 |
|
|
(954 |
) |
|||
Benefit obligations |
|
3,229 |
|
|
397 |
|
|||
Net cash provided by operating activities |
|
98,225 |
|
|
13,685 |
|
|||
Cash flows from investing activities: | |||||||||
Capital additions |
|
(20,835 |
) |
|
(17,986 |
) |
|||
Acquisitions |
|
- |
|
|
(527,993 |
) |
|||
Other |
|
672 |
|
|
306 |
|
|||
Net cash used for investing activities |
|
(20,163 |
) |
|
(545,673 |
) |
|||
Cash flows from financing activities: | |||||||||
Cash dividends |
|
(18,447 |
) |
|
(17,872 |
) |
|||
|
|
(1,029 |
) |
|
(918 |
) |
|||
Proceeds from bank borrowings |
|
5,000 |
|
|
457,000 |
|
|||
Payments to banks for borrowings |
|
(39,500 |
) |
|
(8,750 |
) |
|||
Debt issuance fees |
|
- |
|
|
(15,217 |
) |
|||
Other |
|
(551 |
) |
|
(130 |
) |
|||
Net cash provided by (used for) financing activities |
|
(54,527 |
) |
|
414,113 |
|
|||
Effect of exchange rate changes on cash |
|
200 |
|
|
(536 |
) |
|||
Net increase (decrease) in cash and cash equivalents |
|
23,735 |
|
|
(118,411 |
) |
|||
Cash and cash equivalents: | |||||||||
Beginning of period |
|
6,783 |
|
|
125,194 |
|
|||
End of period |
$ |
30,518 |
|
$ |
6,783 |
|
|
|||||||||||
Non-GAAP Financial Information | |||||||||||
(thousands of dollars, except per share data) | |||||||||||
Three Months Ended |
Year Ended |
||||||||||
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||
Adjusted earnings: | |||||||||||
Reported net income – GAAP basis |
$ |
8,976 |
$ |
2,427 |
$ |
34,951 |
$ |
11,195 |
|||
Plus pension settlement charge |
|
- |
|
58 |
|
- |
|
5,216 |
|||
Plus one-time acquisition costs |
|
- |
|
31 |
|
- |
|
5,752 |
|||
Plus amortization of step up in value of acquired inventories |
|
- |
|
- |
|
- |
|
1,141 |
|||
Plus amortization of acquired customer backlog |
|
- |
|
514 |
|
863 |
|
1,231 |
|||
Non-GAAP adjusted earnings |
$ |
8,976 |
$ |
3,030 |
$ |
35,814 |
$ |
24,535 |
|||
Three Months Ended |
Year Ended |
||||||||||
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||
Adjusted earnings per share: | |||||||||||
Reported earnings per share – GAAP basis |
$ |
0.34 |
$ |
0.09 |
$ |
1.34 |
$ |
0.43 |
|||
Plus pension settlement charge |
|
- |
|
- |
|
- |
|
0.20 |
|||
Plus one-time acquisition costs |
|
- |
|
- |
|
- |
|
0.22 |
|||
Plus amortization of step up in value of acquired inventories |
|
- |
|
- |
|
- |
|
0.04 |
|||
Plus amortization of acquired customer backlog |
|
- |
|
0.02 |
|
0.03 |
|
0.05 |
|||
Non-GAAP adjusted earnings per share |
$ |
0.34 |
$ |
0.11 |
$ |
1.37 |
$ |
0.94 |
|||
Three Months Ended |
Year Ended |
||||||||||
2023 |
|
2022 |
|
2023 |
|
2022 |
|||||
Adjusted earnings before interest, taxes, depreciation and amortization: | |||||||||||
Reported net income – GAAP basis |
$ |
8,976 |
$ |
2,427 |
$ |
34,951 |
$ |
11,195 |
|||
Plus interest expense |
|
10,126 |
|
9,361 |
|
41,273 |
|
19,240 |
|||
Plus provision for income taxes |
|
2,264 |
|
726 |
|
9,010 |
|
2,677 |
|||
Plus depreciation and amortization expense |
|
7,300 |
|
6,997 |
|
28,496 |
|
21,158 |
|||
Non-GAAP earnings before interest, | |||||||||||
taxes, depreciation and amortization |
|
28,666 |
|
19,511 |
|
113,730 |
|
54,270 |
|||
Plus pension settlement charge |
|
- |
|
72 |
|
- |
|
6,427 |
|||
Plus one-time acquisition costs |
|
- |
|
40 |
|
- |
|
7,088 |
|||
Plus amortization of step up in value of acquired inventories |
|
- |
|
- |
|
- |
|
1,406 |
|||
Plus amortization of acquired customer backlog |
|
- |
|
650 |
|
1,085 |
|
1,517 |
|||
Plus non-cash LIFO expense |
|
477 |
|
8,274 |
|
6,891 |
|
18,041 |
|||
Non-GAAP adjusted earnings before interest, | |||||||||||
taxes, depreciation and amortization |
$ |
29,143 |
$ |
28,547 |
$ |
121,706 |
$ |
88,749 |
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Corporate Secretary
Telephone (419) 755-1246
For additional information, contact
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