NOW Inc. Announces First Quarter 2015 Financial Results
Operating flow-through was ten percent sequentially, when excluding the
charges above and adding back margins of
The Company’s revenues for the first quarter of 2015 were
In the first quarter of 2015 the Company completed the acquisition of
The Company also completed the acquisition of Machine Tools Supply
(“MTS”) in the first quarter of 2015. MTS, based in
The Company’s third acquisition of the quarter aligns with the three
deals completed in the fourth quarter of 2014, and the Company’s most
recently completed deal in the second quarter of 2015 of a
European-based company, building on the Company’s product line and
growth strategies in valve automation, pipe, valves, fittings,
artificial lift in the U.S., personal protective equipment in the
“We are excited about the opportunities provided by our seven recent acquisitions to DistributionNOW, and welcome these employees to the family. We believe these businesses will enhance the level of service and solutions we provide our customers. We continue to focus on long-term fundamentals of the distribution and supply chain businesses as we seek to improve our strategic position for the future. We are pleased that our strong balance sheet enables us to continue to capitalize on attractive opportunities.”
First quarter revenues for
Revenues for the first quarter of 2015 for
International
International operations generated first quarter revenues of
The Company has scheduled a conference call for
Statements made in this press release that are forward-looking in nature
are intended to be "forward-looking statements" within the meaning of
Section 21E of the Securities Exchange Act of 1934 and may involve risks
and uncertainties. These statements may differ materially from actual
future events or results. Readers are referred to documents filed by
NOW INC. | |||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||||||
(In millions, except share data) | |||||||||||
March 31, | December 31, | ||||||||||
2015 | 2014 | ||||||||||
(Unaudited) | |||||||||||
ASSETS | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 122 | $ | 195 | |||||||
Receivables, net | 797 | 851 | |||||||||
Inventories, net | 945 | 949 | |||||||||
Deferred income taxes | 23 | 22 | |||||||||
Prepaid and other current assets | 20 | 30 | |||||||||
Total current assets | 1,907 | 2,047 | |||||||||
Property, plant and equipment, net | 143 | 124 | |||||||||
Deferred income taxes | 2 | 2 | |||||||||
Goodwill | 429 | 346 | |||||||||
Intangibles, net | 123 | 73 | |||||||||
Other assets | 5 | 4 | |||||||||
Total assets | $ | 2,609 | $ | 2,596 | |||||||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | 417 | $ | 490 | |||||||
Accrued liabilities | 108 | 125 | |||||||||
Other current liabilities | 1 | 5 | |||||||||
Total current liabilities | 526 | 620 | |||||||||
Long-term debt | 135 | − | |||||||||
Deferred income taxes | 21 | 10 | |||||||||
Other long-term liabilities | 5 | − | |||||||||
Total liabilities | 687 | 630 | |||||||||
Commitments and contingencies | − | − | |||||||||
Stockholders' equity: | |||||||||||
Preferred stock - par value $0.01; 20 million shares authorized; | |||||||||||
no shares issued and outstanding | − | − | |||||||||
Common stock - par value $0.01; 330 million shares authorized; | |||||||||||
107,178,567 and 107,067,457 shares issued and outstanding, respectively | 1 | 1 | |||||||||
Additional paid-in capital | 1,957 | 1,952 | |||||||||
Retained earnings | 48 | 58 | |||||||||
Accumulated other comprehensive loss | (84 | ) | (45 | ) | |||||||
Total stockholders' equity | 1,922 | 1,966 | |||||||||
Non-controlling interest |
|||||||||||
Total liabilities and stockholders' equity | $ | 2,609 | $ | 2,596 | |||||||
NOW INC. | ||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) | ||||||||||||
(In millions, except per share data) | ||||||||||||
Three Months Ended | ||||||||||||
March 31, | December 31, | |||||||||||
2015 | 2014 | 2014 | ||||||||||
Revenue | $ | 863 | $ | 1,077 | $ | 1,006 | ||||||
Operating expenses: | ||||||||||||
Cost of products | 708 | 869 | 801 | |||||||||
Warehousing, selling and administrative | 163 | 146 | 179 | |||||||||
Operating profit (loss) | (8 | ) | 62 | 26 | ||||||||
Other income (expense) | (4 | ) | − | (2 | ) | |||||||
Income (loss) before income taxes | (12 | ) | 62 | 24 | ||||||||
Income tax provision (benefit) | (2 | ) | 21 | 8 | ||||||||
Net income (loss) | $ | (10 | ) | $ | 41 | $ | 16 | |||||
Earnings (loss) per share: | ||||||||||||
Basic earnings (loss) per common share | $ | (0.09 | ) | $ | 0.38 | $ | 0.15 | |||||
Diluted earnings (loss) per common share | $ | (0.09 | ) | $ | 0.38 | $ | 0.14 | |||||
Weighted-average common shares outstanding, basic | 107 | 107 | 107 | |||||||||
Weighted-average common shares outstanding, diluted | 107 | 107 | 108 | |||||||||
NOW INC. SUPPLEMENTAL INFORMATION |
||||||||||
BUSINESS SEGMENTS (UNAUDITED) | ||||||||||
(In millions) | ||||||||||
Three Months Ended | ||||||||||
March 31, | December 31, | |||||||||
2015 | 2014 | 2014 | ||||||||
Revenue: | ||||||||||
United States | $ | 601 | $ | 704 | $ | 679 | ||||
Canada | 116 | 191 | 180 | |||||||
International | 146 | 182 | 147 | |||||||
Total revenue | $ | 863 | $ | 1,077 | $ | 1,006 | ||||
NOW INC. SUPPLEMENTAL INFORMATION (CONTINUED)
NET INCOME (LOSS) TO EBITDA EXCLUDING OTHER COSTS RECONCILIATION (UNAUDITED) (In millions) |
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Three Months Ended | |||||||||||||
March 31, | December 31, | ||||||||||||
2015 | 2014 | 2014 | |||||||||||
Net income (loss) (1) | $ | (10 | ) | $ | 41 | $ | 16 | ||||||
Interest, net (2) | − | − | − | ||||||||||
Income tax provision (benefit) | (2 | ) | 21 | 8 | |||||||||
Depreciation and amortization | 7 | 4 | 7 | ||||||||||
Other costs (3) | 9 | − | 1 | ||||||||||
EBITDA excluding other costs | $ | 4 | $ | 66 | $ | 32 | |||||||
EBITDA % excluding other costs (4) | 0.5 | % | 6.1 | % | 3.2 | % | |||||||
DILUTED EARNINGS PER SHARE (“EPS”) TO DILUTED EPS EXCLUDING OTHER COSTS RECONCILIATION (UNAUDITED) |
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Three Months Ended | |||||||||||
March 31, | December 31, | ||||||||||
2015 | 2014 | 2014 | |||||||||
GAAP diluted earnings (loss) per share (5) | $ | (0.09 | ) | $ | 0.38 | $ | 0.14 | ||||
Other costs (3) | 0.07 | − | 0.01 | ||||||||
Diluted earnings (loss) per share excluding other costs | $ | (0.02 | ) | $ | 0.38 | $ | 0.15 |
(1) We believe that net income (loss) is the financial measure calculated and presented in accordance with U.S. generally accepted accounting principles that is most directly comparable to EBITDA excluding other costs. EBITDA excluding other costs measures the Company’s operating performance without regard to certain expenses. EBITDA excluding other costs is not a presentation made in accordance with GAAP and the Company’s computation of EBITDA excluding other costs may vary from others in the industry. EBITDA excluding other costs has important limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP. | |
(2) Interest, net was less than $1 million for all periods presented. | |
(3) Other costs primarily includes the transaction costs associated with acquisitions including the cost of inventory that was stepped up to fair value during purchase accounting related to acquisitions and severance expenses which are included in operating profit (loss). Other costs in the quarter ended March 31, 2015 was approximately $7 million, net of tax. | |
(4) EBITDA % excluding other costs is defined as EBITDA excluding other costs divided by Revenue. | |
(5) We believe that diluted earnings (loss) per share is the financial measure calculated and presented in accordance with U.S. generally accepted accounting principles that is most directly comparable to diluted earnings (loss) per share excluding other costs. Diluted earnings (loss) per share excluding other costs measures the Company’s operating performance without regard to certain expenses. Diluted earnings (loss) per share excluding other costs is not a presentation made in accordance with GAAP and the Company’s computation of diluted earnings (loss) per share excluding other costs may vary from others in the industry. Diluted earnings (loss) per share excluding other costs has important limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP. |
Source:
NOW Inc.
Daniel Molinaro, 281-823-4941