UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date of
Report (Date of earliest event reported): February 4, 2010
GRIFFON
CORPORATION
(Exact
Name of Registrant as Specified in Charter)
|
Delaware
|
1-06620
|
11-1893410
|
|
(State
or Other Jurisdiction
|
(Commission
|
(I.R.S.
Employer
|
|
of
Incorporation)
|
File
Number)
|
Identification
Number)
|
|
712
Fifth Avenue, 18th
Floor
|
|
|
New
York, New York
|
10019
|
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
(212)
957-5000
(Registrant’s
telephone number, including area code)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction
A.2. below):
¨ Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
¨ Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
¨ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
2.02. Results of Operations and
Financial Condition.
On
February 4, 2010, Griffon Corporation (the “Registrant”) issued a press release
announcing the Registrant’s financial results for the first fiscal quarter ended
December 31, 2009. A copy of the Registrant’s press release is
attached hereto as Exhibit 99.1.
Item
9.01. Financial Statements and
Exhibits.
(d) Exhibits.
99.1
Press Release, dated February 4, 2010
The
information filed as an exhibit to this Form 8-K is being furnished in
accordance with Item 2.02 and shall not be deemed to be “filed” for the purposes
of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), or otherwise subject to the liabilities of such section, nor shall such
information be deemed incorporated by reference in any filing under the
Securities Act of 1933, as amended, or the Exchange Act, except as shall be
expressly set forth by specific reference in such a filing.
2
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
|
GRIFFON
CORPORATION
|
||
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By:
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/s/ Douglas J. Wetmore
|
|
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Douglas
J. Wetmore
|
||
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Executive
Vice President and
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||
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Chief
Financial Officer
|
||
Date: February
4, 2010
3
Exhibit
Index
|
|
99.1
|
Press
release, dated February 4, 2010
|
FOR IMMEDIATE
RELEASE
Griffon
Corporation Announces First Quarter Results
1Q
2010 Continuing Operations EPS of $0.07 vs. Year-ago of $0.04
1Q
2010 Segment Adjusted EBITDA increases 47% to $25 million
Book
Value Increases to $11.84 per Share
NEW YORK, NEW YORK, February 4,
2010 – Griffon Corporation (NYSE: GFF) today reported financial results
for the first quarter ended December 31, 2009.
First
quarter revenue was $305.2 million, compared to $302.3 million in the prior year
quarter. Income from continuing operations for the quarter was $4.2 million, or
$0.07 per diluted share, compared to $2.1 million, or $0.04 per diluted share,
last year. The 2010 first quarter results included $0.01 per diluted share of
restructuring charges associated with the consolidation of facilities at
Building Products and the prior year quarter included $0.04 per diluted share
relating to the gain on the extinguishment of debt. In the first
quarter of both fiscal 2010 and 2009, results of discontinued operations were
immaterial. Net income for the first quarter was $4.3 million, or
$0.07 per diluted share, compared to $2.1 million, or $0.04 per diluted share,
in the prior year first quarter.
The
Company’s segment adjusted EBITDA in the first quarter of fiscal 2010 grew 47%
to $25 million compared to $17 million in the prior year quarter. Segment
adjusted EBITDA is defined as income from continuing operations, excluding
corporate overhead, interest, taxes, depreciation and amortization,
restructuring charges and the benefit (loss) of debt
extinguishment.
On
October 1, 2009, the Company adopted the new accounting standard which requires
the liability and equity components of convertible debt instruments be
separately accounted for using the Company’s nonconvertible debt
rate. Adoption of this standard must be applied retrospectively; as a
result, the prior year’s first quarter income from continuing operations and net
income were each reduced by $2.2 million and the related diluted EPS by $0.03
per share.
Results of
Operations
Telephonics
Telephonics
revenue increased $22.8 million, or 28%, to $104 million compared to the prior
year quarter. The revenue increase was primarily the result of higher sales in
the Electronic Systems, Radar and Communications divisions, with the largest
contribution from the CREW 3.1 Sierra Nevada Corporation contract.
Segment
operating income increased $1.6 million, or 30%, to $7.0 million from the prior
year quarter, driven by the strong revenue growth. Segment operating
profit margin increased 10 basis points to 6.8%, principally due to a favorable
program mix, largely offset by higher SG&A expenses. The increase in
SG&A expenses was primarily due to higher research expenditures and
additional expense to support sales growth as Telephonics pursues new business
in the Unmanned Aerial Vehicle (UAV) and Air Traffic Management (ATM)
markets.
During
the quarter, Telephonics was awarded several new contracts and incremental
funding on current contracts totaling $87 million, and the backlog was $376
million at December 31, 2009 with 80% expected to be realized in the next 12
months.
Clopay
Building Products
Building
Products revenue decreased $9.3 million, or 9%, compared to the prior year
quarter. The decrease was primarily due to lower sales volume
resulting from the continued effects of the weak commercial construction market,
amid signs of stabilization in the housing market; the volume decline was
partially offset by the translation benefit from a weaker U.S. dollar for
Canadian based sales.
Segment
operating profit of $6.9 million increased $11.3 million compared to a loss of
$4.4 million in the prior year quarter. The improved operating
performance, notwithstanding the decline in revenue, was driven by lower product
costs and lower selling, general and administrative expenses, driven by the
various restructuring activities Building Products has undertaken in the past
several quarters.
The
segment’s facilities consolidation project remains on schedule with expected
completion in early calendar 2011.
Clopay
Plastic Products
Plastics
revenue decreased $10.7 million, or 9%, compared to the 2009 quarter. Lower
customer selling prices driven by declining resin costs, accounted for a
significant portion of the revenue decline; Plastics adjusts customer selling
prices based on underlying resin costs, on a three-month delay. Revenue was also
impacted by decreased European volume, partially offset by the benefit of
favorable foreign exchange translation and higher volume in the North American
business.
Segment
operating profit decreased by $5.2 million compared to the prior year quarter.
The cost of resin has rebounded from early calendar 2009 lows, increasing
cost of sales; such increased costs have not yet been reflected in higher
customer selling prices due to the three month delay, effecting margin.
The Company expects that, based on current resin price trends, operating
profit will continue to be unfavorably impacted by resin cost increases through
the end of its second fiscal quarter. The lower European volume also unfavorably
impacted absorption of fixed manufacturing expenses.
Balance Sheet and Capital
Expenditures
Cash and
equivalents at December 31, 2009 totaled $376.3 million. Total debt outstanding
at December 31, 2009 was $247.5 million, for a net cash position of $128.9
million. Capital expenditures in the first quarter were $10.0
million.
On
December 21, 2009, the Company issued $100 million principal amount of 4%
Convertible Subordinated Notes due 2017 (the “2017 Notes”). The
initial conversion rate is 67.0799 shares of Griffon’s common stock per $1,000
principal amount of 2017 Notes, corresponding to an initial conversion price of
$14.91 per share of Griffon’s common stock. This represented a 23%
premium over the December 15, 2009 closing price of $12.12. Upon
conversion, the Company can settle the 2017 Notes in cash or stock, or a
combination of cash and stock. The proceeds from this debt will be
used for general corporate purposes, including working capital, the repayment or
repurchase of corporate indebtedness, investment in current segments and/or
acquisition of other businesses.
In
December 2009, the Company purchased $19.2 million face value of 4% Convertible
Subordinated Notes due 2023 (the “2023 Notes”) for $19.4 million. Including
related unamortized debt issuance costs, the purchase resulted in an immaterial
pre-tax loss in the first quarter of fiscal 2010. In January 2010,
the Company purchased $10.1 million face value of the 2023 Notes for $10.2
million. Including related unamortized debt issuance costs, the purchase
resulted in an immaterial pre-tax loss to be recognized in the second quarter of
fiscal 2010. Including the effect of both of these repurchases, the
outstanding balance of the 2023 Notes was $50.0 million as of February 4,
2010.
Conference Call
Information
The
Company will hold a conference call today, February 4, 2010, at 4:30 PM
ET.
The call
can be accessed by dialing 1-877-407-0784 (U.S. participants) or (201) 689-8560
(International participants). Callers should ask to be connected to
Griffon Corporation’s first quarter fiscal 2010 teleconference and provide the
conference ID number 343595.
A replay
of the call will be available starting on Thursday, February 4, 2010 at 7:30 PM
ET by dialing 1-877-660-6853 (U.S.) or (201) 612-7415 (International). The
replay account number is 3055 with access code 343595. The replay
will be available through February 18, 2010.
Forward-looking
Statements
“Safe
Harbor” Statements under the Private Securities Litigation Reform Act of 1995:
All statements related to, among other things, income, earnings, cash flows,
revenue, changes in operations, operating improvements, industries in which
Griffon Corporation (the “Company” or “Griffon”) operates and the United States
and global economies that are not historical are hereby identified as
“forward-looking statements” and may be indicated by words or phrases such as
“anticipates,” “supports,” “plans,” “projects,” “expects,” “believes,” “should,”
“would,” “could,” “hope,” “forecast,” “management is of the opinion,” “may,”
“will,” “estimates,” “intends,” “explores,” “opportunities,” the negative of
these expressions, use of the future tense and similar words or
phrases. Such forward-looking statements are subject to inherent
risks and uncertainties that could cause actual results to differ materially
from those expressed in any forward-looking statements. These risks and
uncertainties include, among others: current economic conditions and
uncertainties in the housing, credit and capital markets; the Company’s ability
to achieve expected savings from cost control, integration and disposal
initiatives; the ability to identify and successfully consummate and integrate
value-adding acquisition opportunities; increasing competition and pricing
pressures in the markets served by Griffon’s operating companies; the ability of
Griffon’s operating companies to expand into new geographic and product markets
and to anticipate and meet customer demands for new products and product
enhancements and innovations; the government reduces military spending on
projects supplied by Griffon’s Telephonics Corporation; increases in cost of raw
materials such as resin and steel; changes in customer demand; political events
that could impact the worldwide economy; a downgrade in the Company’s credit
ratings; international economic conditions including interest rate and currency
exchange fluctuations; the relative mix of products and services which impacts
margins and operating efficiencies; short-term capacity constraints or prolonged
excess capacity; unforeseen developments in contingencies such as litigation;
unfavorable results of government agency contract audits of Griffon’s
subsidiary, Telephonics Corporation; protection and validity of patent and other
intellectual property rights; the cyclical nature of the business of certain
Griffon operating companies; and possible terrorist threats and actions, and
their impact on the global economy. Such statements reflect the views
of the Company with respect to future events and are subject to these and other
risks, uncertainties and assumptions relating to the operations, results of
operations, growth strategy and liquidity of the Company as previously disclosed
in the Company’s Securities and Exchange Commission filings. Readers
are cautioned not to place undue reliance on these forward-looking statements.
These forward-looking statements speak only as of the date made. The
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise, except as required by law.
About Griffon
Corporation
Griffon
Corporation (the “Company” or “Griffon”), is a diversified management and
holding company that conducts business through wholly-owned
subsidiaries. The Company oversees the operations of its
subsidiaries, allocates resources among them and manages their capital
structures. The Company provides direction and assistance to its
subsidiaries in connection with acquisition and growth opportunities as well as
in connection with divestitures. Griffon also seeks out, evaluates
and, when appropriate, will acquire additional businesses that offer potentially
attractive returns on capital to further diversify itself.
Griffon
currently conducts its operations through Telephonics Corporation, Clopay
Building Products Company and Clopay Plastic Products Company.
|
·
|
Telephonics
Corporation high-technology engineering and manufacturing capabilities
provide integrated information, communication and sensor system solutions
to military and commercial markets
worldwide.
|
|
·
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Clopay
Building Products Company is a leading manufacturer and marketer of
residential, commercial and industrial garage doors to professional
installing dealers and major home center retail
chains.
|
|
·
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Clopay
Plastic Products Company is an international leader in the development and
production of embossed, laminated and printed specialty plastic films used
in a variety of hygienic, health-care and industrial
applications.
|
For more
information on the Company and its operating subsidiaries, please see the
Company's website at www.griffoncorp.com.
|
Company Contact:
|
Investor Relations
Contact:
|
|
|
Douglas J. Wetmore
|
James Palczynski
|
|
|
Chief
Financial Officer
|
Principal
and Director
|
|
|
Griffon
Corporation
|
ICR
Inc.
|
|
|
(212)
957-5000
|
(203)
682-8229
|
|
|
712
Fifth Avenue, 18th
Floor
|
||
|
New
York, NY 10019
|
4
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GRIFFON
CORPORATION AND SUBSIDIARIES
|
|
OPERATING
HIGHLIGHTS
|
|
(Unaudited)
(in
thousands)
|
|
For
the Three Months Ended
December
31,
|
||||||||
|
2009
|
2008
|
|||||||
|
REVENUE
|
||||||||
|
Telephonics
|
$ | 103,619 | $ | 80,827 | ||||
|
Building
Products
|
99,522 | 108,818 | ||||||
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Plastics
|
102,016 | 112,689 | ||||||
|
Total consolidated net
sales
|
$ | 305,157 | $ | 302,334 | ||||
|
INCOME BEFORE TAXES AND
DISCONTINUED OPERATIONS
|
||||||||
|
Segment operating profit
(loss):
|
||||||||
|
Telephonics
|
$ | 6,995 | $ | 5,378 | ||||
|
Building
Products
|
6,861 | (4,393 | ) | |||||
|
Plastics
|
361 | 5,536 | ||||||
|
Total
segment operating profit
|
14,217 | 6,521 | ||||||
|
Unallocated
amounts
|
(6,281 | ) | (4,449 | ) | ||||
|
Gain
(loss) from debt extinguishment, net
|
(18 | ) | 4,304 | |||||
|
Net
interest expense
|
(2,908 | ) | (3,313 | ) | ||||
|
Income
before taxes and discontinued operations
|
$ | 5,010 | $ | 3,063 | ||||
|
Unallocated
amounts typically include general corporate expenses not attributable to
any reportable segment.
|
Prior
year amounts have been adjusted for the adoption of the new accounting standard
for convertible debt.
5
|
GRIFFON
CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
|
(Unaudited)
|
|
(in
thousands, except per share
data)
|
|
Three Months Ended December
31,
|
||||||||
|
2009
|
2008
|
|||||||
|
Revenue
|
$ | 305,157 | $ | 302,334 | ||||
|
Cost
of goods and services
|
234,876 | 243,377 | ||||||
|
Gross
profit
|
70,281 | 58,957 | ||||||
|
Selling,
general and administrative expenses
|
61,961 | 56,528 | ||||||
|
Restructuring
and other related charges
|
1,011 | - | ||||||
|
Total
operating expenses
|
62,972 | 56,528 | ||||||
|
Income
from operations
|
7,309 | 2,429 | ||||||
|
Other
income (expense)
|
||||||||
|
Interest
expense
|
(2,970 | ) | (3,749 | ) | ||||
|
Interest
income
|
62 | 436 | ||||||
|
Gain
(loss) from debt extinguishment, net
|
(18 | ) | 4,304 | |||||
|
Other,
net
|
627 | (357 | ) | |||||
|
Total
other income (expense)
|
(2,299 | ) | 634 | |||||
|
Income
before taxes and discontinued operations
|
5,010 | 3,063 | ||||||
|
Provision
for income taxes
|
830 | 997 | ||||||
|
Income
from continuing operations
|
4,180 | 2,066 | ||||||
|
Discontinued
operations:
|
||||||||
|
Income
from operations of the discontinued Installation Services
business
|
170 | 5 | ||||||
|
Provision
for income taxes
|
59 | 2 | ||||||
|
Income
from discontinued operations
|
111 | 3 | ||||||
|
Net
income
|
$ | 4,291 | $ | 2,069 | ||||
|
Basic
earnings per common share:
|
||||||||
|
Income
from continuing operations
|
$ | 0.07 | $ | 0.04 | ||||
|
Income
from discontinued operations
|
0.00 | 0.00 | ||||||
|
Net
income
|
0.07 | 0.04 | ||||||
|
Weighted-average
shares outstanding
|
58,836 | 58,853 | ||||||
|
Diluted
earnings per common share:
|
||||||||
|
Income
from continuing operations
|
$ | 0.07 | $ | 0.04 | ||||
|
Income
from discontinued operations
|
0.00 | 0.00 | ||||||
|
Net
income
|
0.07 | 0.04 | ||||||
|
Weighted-average
shares outstanding
|
59,599 | 58,918 | ||||||
Note: Due
to rounding, the sum of earnings per share of Continuing operations and
Discontinued operations may not equal earnings per share of Net
income.
Prior
year amounts have been adjusted for the adoption of the new accounting standard
for convertible debt.
6
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GRIFFON
CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
(Unaudited)
|
|
(in
thousands)
|
|
At December 31,
2009
|
At September 30,
2009
|
|||||||
|
CURRENT
ASSETS
|
||||||||
|
Cash
and equivalents
|
$ | 376,344 | $ | 320,833 | ||||
|
Accounts
receivable, net of allowances of $4,414 and $4,457
|
163,603 | 164,619 | ||||||
|
Contract
costs and recognized income not yet billed, net of progress payments of
$14,945 and $14,592
|
68,680 | 75,536 | ||||||
|
Inventories,
net
|
136,610 | 139,170 | ||||||
|
Prepaid
and other current assets
|
42,344 | 39,261 | ||||||
|
Assets
of discontinued operations
|
1,549 | 1,576 | ||||||
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Total
Current Assets
|
789,130 | 740,995 | ||||||
|
PROPERTY,
PLANT AND EQUIPMENT, net
|
236,092 | 236,019 | ||||||
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GOODWILL
|
97,359 | 97,657 | ||||||
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INTANGIBLE
ASSETS, net
|
32,988 | 34,211 | ||||||
|
OTHER
ASSETS
|
26,289 | 29,132 | ||||||
|
ASSETS
OF DISCONTINUED OPERATIONS
|
5,805 | 5,877 | ||||||
|
Total
Assets
|
$ | 1,187,663 | $ | 1,143,891 | ||||
|
CURRENT
LIABILITIES
|
||||||||
|
Notes
payable and current portion of long-term debt net of debt discount of
$1,517 and $2,820
|
$ | 60,639 | $ | 78,590 | ||||
|
Accounts
payable
|
116,174 | 125,027 | ||||||
|
Accrued
and other current liabilities
|
52,066 | 61,120 | ||||||
|
Liabilities
of discontinued operations
|
4,755 | 4,932 | ||||||
|
Total
Current Liabilities
|
233,634 | 269,669 | ||||||
|
LONG-TERM DEBT, net of
debt discount of $24,498 and $0
|
160,828 | 98,394 | ||||||
|
OTHER
LIABILITIES
|
78,760 | 78,837 | ||||||
|
LIABILITIES
OF DISCONTINUED OPERATIONS
|
8,601 | 8,784 | ||||||
|
Total
Liabilities
|
481,823 | 455,684 | ||||||
|
COMMITMENTS
AND CONTINGENCIES
|
||||||||
|
SHAREHOLDERS'
EQUITY
|
||||||||
|
Total
Shareholders' Equity
|
705,840 | 688,207 | ||||||
|
Total
Liabilities and Shareholders' Equity
|
$ | 1,187,663 | $ | 1,143,891 | ||||
Prior
year amounts have been adjusted for the adoption of the new accounting standard
for convertible debt.
7
GRIFFON
CORPORATION AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF CASH FLOWS
(Unaudited)
(in
thousands)
|
Three
Months Ended December 31,
|
||||||||
|
2009
|
2008
|
|||||||
|
CASH
FLOWS FROM OPERATING ACTIVITIES
|
||||||||
|
Net
income
|
$ | 4,291 | $ | 2,069 | ||||
|
Adjustments
to reconcile net income to net cash provided by (used in) operating
activities:
|
||||||||
|
Income
from discontinued operations
|
(111 | ) | (3 | ) | ||||
|
Depreciation
and amortization
|
9,918 | 10,553 | ||||||
|
Long-term
debt discount
|
886 | 1,001 | ||||||
|
Stock-based
compensation
|
1,430 | 814 | ||||||
|
Provisions
(recoveries) for losses on account receivable
|
514 | (346 | ) | |||||
|
Amortization/write-off
of deferred financing costs
|
310 | 374 | ||||||
|
Loss
(gain) from debt extinguishment, net
|
18 | (4,304 | ) | |||||
|
Deferred
income taxes
|
(4,597 | ) | (1,616 | ) | ||||
|
Change
in assets and liabilities:
|
||||||||
|
Decrease
in accounts receivable and contract costs and recognized income not yet
billed
|
7,060 | 20,190 | ||||||
|
(Increase)
decrease in inventories
|
2,254 | (2,934 | ) | |||||
|
Increase
in prepaid and other assets
|
(1,388 | ) | (1,341 | ) | ||||
|
Decrease
in accounts payable,
|
||||||||
|
accrued
liabilities and income taxes payable
|
(18,107 | ) | (27,402 | ) | ||||
|
Other
changes, net
|
185 | (2,267 | ) | |||||
|
Net
cash provided by (used in) operating activities
|
2,663 | (5,212 | ) | |||||
|
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
|
Acquisition
of property, plant and equipment
|
(10,010 | ) | (4,831 | ) | ||||
|
Increase
in equipment lease deposits
|
(28 | ) | (231 | ) | ||||
|
Net
cash used in investing activities
|
(10,038 | ) | (5,062 | ) | ||||
|
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||||||
|
Proceeds
from issuance of shares from rights offering
|
- | 5,274 | ||||||
|
Proceeds
from issuance of long-term debt
|
100,000 | 4,370 | ||||||
|
Payments
of long-term debt
|
(32,513 | ) | (32,837 | ) | ||||
|
Increase
in short-term borrowings
|
- | 2,021 | ||||||
|
Financing
costs
|
(4,057 | ) | (93 | ) | ||||
|
Purchase
of ESOP shares
|
- | (4,370 | ) | |||||
|
Exercise
of stock options
|
143 | - | ||||||
|
Tax
benefit from exercise of options/vesting of restricted
stock
|
43 | - | ||||||
|
Other,
net
|
24 | 419 | ||||||
|
Net
cash provided by (used in) financing activities
|
63,640 | (25,216 | ) | |||||
|
CASH
FLOWS FROM DISCONTINUED OPERATIONS:
|
||||||||
|
Net
cash used in operating activities of discontinued
operations
|
(111 | ) | (323 | ) | ||||
|
Net
cash used in discontinued operations
|
(111 | ) | (323 | ) | ||||
|
Effect
of exchange rate changes on cash and equivalents
|
(643 | ) | (84 | ) | ||||
|
NET
INCREASE (DECREASE) IN CASH AND EQUIVALENTS
|
55,511 | (35,897 | ) | |||||
|
CASH
AND EQUIVALENTS AT BEGINNING OF PERIOD
|
320,833 | 311,921 | ||||||
|
CASH
AND EQUIVALENTS AT END OF PERIOD
|
$ | 376,344 | $ | 276,024 | ||||
Prior
year amounts have been adjusted for the adoption of the new accounting standard
for convertible debt.
8
The
following is a reconciliation of operating income, which is a GAAP measure of
Griffon’s operating results, to segment operating income and segment adjusted
EBITDA. Management believes that the presentation of segment operating income,
segment EBITDA and segment adjusted EBITDA is appropriate to provide additional
information about the Company’s reportable segments. Segment operating income
and segment adjusted EBITDA are not presentations made in accordance with GAAP,
are not measures of financial performance or condition, liquidity or
profitability of the Company, and should not be considered as an alternative to
(1) net income, operating income or any other performance measures determined in
accordance with GAAP or (2) operating cash flows determined in accordance with
GAAP. Additionally, segment operating income and segment adjusted EBITDA are not
intended to be measures of cash flow for management’s discretionary use, as they
do not consider certain cash requirements such as interest payments, tax
payments, capital expenditures and debt service requirements.
GRIFFON
CORPORATION AND SUBSIDIARIES
RECONCILIATION
OF NON-GAAP MEASURES
BY
REPORTABLE SEGMENT
(Unaudited)
|
(in thousands)
|
Three Months Ended December
31,
|
|||||||
|
2009
|
2008
|
|||||||
|
Telephonics
|
||||||||
|
Segment
operating income
|
$ | 6,995 | $ | 5,378 | ||||
|
Depreciation
and amortization
|
1,626 | 1,487 | ||||||
|
Segment
EBITDA
|
8,621 | 6,865 | ||||||
|
Clopay
Building Products
|
||||||||
|
Segment
operating income (loss)
|
6,861 | (4,393 | ) | |||||
|
Depreciation
and amortization
|
2,597 | 3,232 | ||||||
|
Restructuring
charges
|
1,011 | - | ||||||
|
Segment
adjusted EBITDA
|
10,469 | (1,161 | ) | |||||
|
Clopay
Plastic Products
|
||||||||
|
Segment
operating income
|
361 | 5,536 | ||||||
|
Depreciation
and amortization
|
5,613 | 5,763 | ||||||
|
Segment
EBITDA
|
5,974 | 11,299 | ||||||
|
All
segments:
|
||||||||
|
Income
from operations - as reported
|
7,309 | 2,429 | ||||||
|
Unallocated
amounts
|
6,281 | 4,449 | ||||||
|
Other,
net
|
627 | (357 | ) | |||||
|
Segment
operating income
|
14,217 | 6,521 | ||||||
|
Segment
depreciation and amortization
|
9,836 | 10,482 | ||||||
|
Restructuring
charges
|
1,011 | - | ||||||
|
Segment
adjusted EBITDA
|
$ | 25,064 | $ | 17,003 | ||||
Unallocated
amounts typically include general corporate expenses not attributable to any
reportable segment.
9