Triumph Group Reports Fourth Quarter Fiscal 2021 Results

BERWYN, Pa., May 20, 2021 /PRNewswire/ — Triumph Group, Inc. (NYSE: TGI) («Triumph» or the «Company») today reported financial results for…

BERWYN, Pa., May 20, 2021 /PRNewswire/ — Triumph Group, Inc. (NYSE: TGI) («Triumph» or the «Company») today reported financial results for its fourth quarter and full fiscal year 2021, which ended March 31, 2021.

Fiscal 2021 Highlights

  • Delivered positive free cash flow in second half of year as domestic COVID-19 recovery advances
  • Achieved third consecutive quarter of sequential growth in Systems and Support revenue and margins
  • Continued to successfully execute portfolio strategy to position Triumph for success in the post-COVID landscape
  • Exited the G650 and G280 structures programs and announced the divestiture of three Aerostructure sites: Milledgeville, Georgia; Rayong, Thailand; and Red Oak, Texas. Completed 19 divestitures since 2016
  • Contract wins included systems and MRO content on military helicopters and engines as well as the renegotiation and extension of several of its largest commercial transport contracts with Boeing
  • Strengthened balance sheet and enhanced liquidity following issuance of new $700 million bond offering and at-the-market equity raise of approximately $150 million with the issuance of 9.2 million shares

Fourth Quarter Fiscal 2021

  • Net sales of $466.8 million
  • Operating loss of $46.2 million with operating margin of (10%); adjusted operating income of $32.9 million with adjusted operating margin of 7%
  • Net loss of $73.5 million, or ($1.27) per share; adjusted net income of $5.7 million, or $0.10 per diluted share
  • Cash flow provided by operations of $22.8 million; free cash flow of $16.6 million

Full-Year Fiscal 2021

  • Net sales of $1.9 billion
  • Operating loss of $326.2 million with operating margin of (17%); adjusted operating income of $107.8 million with adjusted operating margin of 6%
  • Net loss of $450.9 million, or ($8.55) per share; adjusted net loss of $1.6 million, or ($0.03) per share
  • Cash flow used in operations of $173.1 million; free cash use of $198.3 million

«As the pandemic recovery progressed, we generated cash for the second consecutive quarter demonstrating strong management of working capital, improving margins from our core operations due to increased efficiencies and the benefits of robust cost reduction actions,» stated Daniel J. Crowley, Triumph’s chairman, president and chief executive officer.  «Profitability on an adjusted basis improved sequentially in the quarter, showing measurable recovery towards pre-COVID levels across both business units. As Triumph accelerates our organic growth, we remain committed to conserving cash and partnering with our customers to deliver value to all our stakeholders.»

Mr. Crowley continued, «For the third consecutive quarter, we increased revenues in our core Systems & Support business driven by higher military volumes and continued aftermarket recovery.  Consolidated organic revenue in the quarter decreased compared to the prior year period due to the exit from and expected declines in certain Aerospace Structures programs as part of our portfolio transformation, as well as the ongoing impact of the COVID-19 pandemic.  We continued to hit our transformation milestones and completed the sale of our Composites and Military structures operations earlier this month.  Furthermore, our at-the-market equity raise in the fourth quarter bolstered our liquidity position and provides additional capital to support growth.»

Fourth Quarter Fiscal Year 2021 Overview

After accounting for the impact of the divestitures, sales for the fourth quarter of fiscal year 2021 were down 29% organically from the comparable prior year period.  The consolidated decline was driven by planned reductions on sunsetting and transitioned programs, impacts of the COVID-19 pandemic and resulting production rate decreases primarily on commercial programs, partially offset by increases in military programs.

Fourth quarter operating loss of $46.2 million included $58.7 million loss on held for sale assets and $20.5 million of restructuring costs associated with reduction in force.  Net loss for the fourth quarter of fiscal year 2021 was $73.5 million, or ($1.27) per share.  On an adjusted basis, net income was $5.7 million, or $0.10 per share. 

Triumph’s results included the following: 

($ millions except EPS)


Pre-tax



After-tax



Diluted EPS


Loss from Continuing Operations – GAAP


$

(73.0)



$

(73.5)



$

(1.27)


Loss on sale of assets and businesses, net



58.7




58.7




1.00


Transformation related costs:













Restructuring costs



20.5




20.5




0.35


Adjusted Income from Continuing Operations – non-GAAP *


$

6.1



$

5.7



$

0.10


* Differences due to rounding

The number of shares used in computing diluted earnings per share for the fourth quarter of 2021 was 58.6 million.

Backlog, which represents the next 24 months of actual purchase orders with firm delivery dates or contract requirements, was $1.9 billion, down as expected compared to the prior year period and on a sequential basis due to divestitures, sunsetting programs and recent production rate reductions, but partially offset by military program increases in Systems & Support. 

For the fourth quarter of fiscal year 2021, cash flow provided by operations was $22.8 million, reflecting improved working capital and operating margins and which included liquidation of approximately $10.0 million in prior period advances against current period deliveries.

Outlook

Due to the uncertainty around the impacts of business disruptions related to the COVID-19 pandemic on the global market and general economic conditions, the Company is not providing financial guidance for its fiscal year ending March 31, 2022 at this time.

Conference Call

Triumph will hold a conference call today, May 20th, at 8:30 a.m. (ET) to discuss the fourth quarter of fiscal year 2021 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 20th to May 27th by calling (855) 859-2056 (Domestic) or (404) 537-3406 (International), passcode #5669003.

About Triumph

Triumph Group, Inc., 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.

Forward Looking Statements

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, 2020.

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) ON FOLLOWING PAGES

 

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


2021



2020



2021



2020


Net sales


$

466,833



$

693,110



$

1,869,719



$

2,900,117


Cost of sales (excluding depreciation shown below)



359,598




556,642




1,476,266




2,307,393


Selling, general & administrative



53,773




63,017




215,962




257,529


Depreciation & amortization



20,515




34,056




93,334




138,168


Impairment of long-lived assets and goodwill






66,121




252,382




66,121


Restructuring costs



20,477




11,850




53,224




25,340


Legal judgment gain, net of expenses












(9,257)


Loss on sale of assets and businesses, net



58,682




1,726




104,702




56,916


Operating (loss) income



(46,212)




(40,302)




(326,151)




57,907


Interest expense and other, net



39,053




26,060




171,397




122,129


Non-service defined benefit (income) expense



(12,244)




15,438




(49,519)




(40,587)


Income tax expense (benefit)



498




(6,679)




2,881




5,798


Net loss


$

(73,519)



$

(75,121)



$

(450,910)



$

(29,433)


Loss per share – basic:

















Net loss


$

(1.27)



$

(1.51)



$

(8.55)



$

(0.58)


Weighted average common shares outstanding – basic



57,920




49,774




52,739




50,494


Loss per share – diluted:

















Net loss


$

(1.27)



$

(1.51)



$

(8.55)



$

(0.58)


Weighted average common shares outstanding – diluted



57,920




49,774




52,739




50,494


Dividends declared and paid per common share


$



$

0.04



$



$

0.16


 

(Continued)

FINANCIAL DATA (UNAUDITED)


TRIUMPH GROUP, INC. AND SUBSIDIARIES

(dollars in thousands, except share data)


BALANCE SHEETS


Unaudited

March 31,

2021



Audited

March 31,

2020


Assets









Cash and cash equivalents


$

589,882



$

485,463


Accounts receivable, net



194,066




359,487


Contract assets



134,638




244,417


Inventory, net



400,366




452,976


Prepaid and other current assets



19,206




19,289


Assets held for sale



216,276





Current assets



1,554,434




1,561,632


Property and equipment, net



211,369




418,141


Goodwill



521,638




513,527


Intangible assets, net



102,453




381,968


Other, net



61,041




105,065


Total assets


$

2,450,935



$

2,980,333


Liabilities & Stockholders’ Deficit









Current portion of long-term debt


$

5,247



$

7,336


Accounts payable



179,473




457,694


Contract liabilities



204,379




295,320


Accrued expenses



271,160




227,403


Liabilities related to assets held for sale



58,108





Current liabilities



718,367




987,753


Long-term debt, less current portion



1,952,296




1,800,171


Accrued pension and post-retirement benefits, noncurrent



384,256




660,065


Deferred income taxes, noncurrent



7,491




7,439


Other noncurrent liabilities



207,378




306,169


Stockholders’ Deficit:









Common stock, $.001 par value, 100,000,000 shares authorized, 64,488,674 and 52,460,920 shares issued



64




52


Capital in excess of par value



978,272




804,830


Treasury stock, at cost, 303,673 and 602,831 shares



(12,606)




(36,217)


Accumulated other comprehensive loss



(530,192)




(746,448)


Accumulated deficit



(1,254,391)




(803,481)


Total stockholders’ deficit



(818,853)




(781,264)


Total liabilities and stockholders’ deficit


$

2,450,935



$

2,980,333


 

(Continued)

FINANCIAL DATA (UNAUDITED)


TRIUMPH GROUP, INC. AND SUBSIDIARIES

(dollars in thousands, except share data)




Fiscal Year Ended March 31




2021



2020


Operating Activities









Net loss


$

(450,910)



$

(29,433)


Adjustments to reconcile net loss to net cash (used in) provided by

   operating activities:









Depreciation and amortization



93,334




138,168


Impairment of long-lived assets



252,382




66,121


Amortization of acquired contract liability



(38,564)




(75,286)


Loss on sale of assets and businesses



104,702




56,916


Curtailments and special termination benefits gain, net






14,293


Other amortization included in interest expense



23,759




11,157


Provision for credit losses



4,853




1,554


(Benefit) provision for deferred income taxes



(176)




2,823


Share-based compensation



12,701




11,062


Changes in other assets and liabilities, excluding the effects of acquisitions and divestitures:









Trade and other receivables



126,294




5,001


Contract assets



46,841




50,440


Inventories



35,412




(48,802)


Prepaid expenses and other current assets



(310)




16,376


Accounts payable, accrued expenses, and contract liabilities



(330,992)




(61,338)


Accrued pension and other postretirement benefits



(51,692)




(66,519)


Other, net



(753)




4,133


Net cash (used in) provided by operating activities



(173,119)




96,666


Investing Activities









Capital expenditures



(25,178)




(39,834)


Proceeds from sale of assets and businesses



15,888




47,229


Net cash (used in) provided by investing activities



(9,290)




7,395


Financing Activities









Net (decrease) increase in revolving credit facility



(400,000)




185,000


Proceeds from issuance of long-term debt



713,900




585,580


Retirement of debt and finance lease obligations



(160,035)




(449,650)


Payment of deferred financing costs



(20,716)




(17,718)


Sales of common stock



145,383





Dividends paid






(8,078)


Repurchase of restricted shares for minimum tax obligations



(1,285)




(1,442)


Net cash provided by financing activities



277,247




293,692


Effect of exchange rate changes on cash



9,581




(5,097)


Net change in cash and cash equivalents



104,419




392,656


Cash and cash equivalents at beginning of period



485,463




92,807


Cash and cash equivalents at end of period


$

589,882



$

485,463


 

(Continued)

FINANCIAL DATA (UNAUDITED)


TRIUMPH GROUP, INC. AND SUBSIDIARIES

(dollars in thousands)




Three Months Ended



Year Ended




March 31,



March 31,


SEGMENT DATA


2021



2020



2021



2020


Net sales:

















Systems & Support


$

301,823



$

352,066



$

1,060,001



$

1,357,564


Aerospace Structures



165,306




345,158




814,371




1,555,887


Elimination of inter-segment sales



(296)




(4,114)




(4,653)




(13,334)




$

466,833



$

693,110



$

1,869,719



$

2,900,117


Operating (loss) income:

















Systems & Support


$

39,484



$

(22,478)



$

113,517



$

141,341


Aerospace Structures



(13,515)




(2,066)




(267,702)




41,864


Corporate



(68,566)




(12,941)




(159,265)




(114,236)


Share-based compensation expense



(3,615)




(2,817)




(12,701)




(11,062)




$

(46,212)



$

(40,302)



$

(326,151)



$

57,907


Operating margin %

















Systems & Support



13.1

%



(6.4)

%



10.7

%



10.4

%

Aerospace Structures



(8.2)

%



(0.6)

%



(32.9)

%



2.7

%

Consolidated



(9.9)

%



(5.8)

%



(17.4)

%



2.0

%


















Depreciation and amortization^:

















Systems & Support


$

8,719



$

74,184



$

33,549



$

98,497


Aerospace Structures



10,989




25,153




308,708




102,418


Corporate



807




840




3,459




3,374




$

20,515



$

100,177



$

345,716



$

204,289


Amortization of acquired contract liabilities:

















Systems & Support


$

(3,493)



$

(8,360)



$

(15,062)



$

(34,486)


Aerospace Structures



(54)




(10,772)




(23,502)




(40,800)




$

(3,547)



$

(19,132)



$

(38,564)



$

(75,286)


Capital expenditures:

















Systems & Support


$

3,420



$

4,786



$

15,239



$

17,141


Aerospace Structures



2,541




7,276




8,909




21,191


Corporate



229




522




1,030




1,502




$

6,190



$

12,584



$

25,178



$

39,834


^ includes goodwill & long-lived asset impairment charges

















(Continued)

FINANCIAL DATA (UNAUDITED)

TRIUMPH GROUP, INC. AND SUBSIDIARIES

(dollars in thousands)

Non-GAAP Financial Measure Disclosures

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, 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 20 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, 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.

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.
  • Legal settlements may be useful to investors to consider because they reflect gains or losses from disputes with third parties. We do not believe that these earnings necessarily reflect the current and ongoing cash earnings related to our operations.
  • Non-service defined benefit income (inclusive of the adoption of ASU 2017-07 and 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,
  • 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)

FINANCIAL DATA (UNAUDITED)

TRIUMPH GROUP, INC. AND SUBSIDIARIES

(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,

Amortization, and Pension (Adjusted EBITDAP):


2021



2020



2021



2020


Net loss


$

(73,519)



$

(75,121)



$

(450,910)



$

(29,433)


Add-back:

















Income tax expense (benefit)



498




(6,679)




2,881




5,798


Interest expense and other, net



39,053




26,060




171,397




122,129


Settlements, curtailments & special termination, net






28,666







14,293


Union incentives












7,071


Loss on sales of assets and businesses, net



58,682




1,726




104,702




56,916


Impairment of rotable inventory









23,689





Legal judgment gain, net of expenses












(9,257)


Amortization of acquired contract liabilities



(3,547)




(19,132)




(38,564)




(75,286)


Depreciation and amortization ^



20,515




100,177




345,716




204,289


Adjusted Earnings before Interest, Taxes, Depreciation and Amortization («Adjusted EBITDA»)


$

41,682



$

55,697



$

158,911



$

296,520


Non-service defined benefit income (excluding settlements)



(12,244)




(13,228)




(49,519)




(54,880)


Adjusted Earnings before Interest, Taxes, Depreciation and Amortization, and Pension («Adjusted EBITDAP»)


$

29,438



$

42,469



$

109,392



$

241,640


Net sales


$

466,833



$

693,110



$

1,869,719



$

2,900,117


Net loss margin



(15.7)

%



(10.8)

%



(24.1)

%



(1.0)

%

Adjusted EBITDAP margin



6.4

%



6.3

%



6.0

%



8.6

%

^ includes goodwill & long-lived asset impairment charges



(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,

Amortization, and Pension (EBITDAP):


Total



Systems &

Support



Aerospace

Structures



Corporate/

Eliminations*


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, Depreciation and Amortization, and Pension («Adjusted EBITDAP»)


$

29,438



$

44,710



$

(2,580)



$

(12,692)


Net sales


$

466,833



$

301,823



$

165,306



$

(296)


Adjusted EBITDAP margin



6.4

%



15.0

%



(1.6)

%


n/a






Year Ended March 31, 2021








Segment Data


Adjusted Earnings before Interest, Taxes, Depreciation,

Amortization, and Pension (EBITDAP):


Total



Systems &

Support



Aerospace

Structures



Corporate/

Eliminations*


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, Depreciation and Amortization, and Pension («Adjusted EBITDAP»)


$

109,392



$

155,693



$

17,504



$

(63,805)


Net sales


$

1,869,719



$

1,060,001



$

814,371



$

(4,653)


Adjusted EBITDAP margin



6.0

%



14.9

%



2.2

%


n/a


* Operating loss at Corporate includes share-based compensation expense.

^ includes long-lived asset impairment charges in fiscal Q1



(Continued)

FINANCIAL DATA (UNAUDITED)


TRIUMPH GROUP, INC. AND SUBSIDIARIES

(dollars in thousands)


Non-GAAP Financial Measure Disclosures (continued)




Three Months Ended March 31, 2020








Segment Data


Adjusted Earnings before Interest, Taxes, Depreciation,

Amortization, and Pension (EBITDAP):


Total



Systems &

Support



Aerospace

Structures



Corporate/

Eliminations*


Net loss


$

(75,121)














Add-back:

















Non-service defined benefit expense



15,438














Income tax benefit



(6,679)














Interest expense and other, net



26,060














Operating loss


$

(40,302)



$

(22,478)



$

(2,066)



$

(15,758)


Loss on sales of assets & businesses, net



1,726










1,726


Amortization of acquired contract liabilities



(19,132)




(8,360)




(10,772)





Depreciation and amortization ^



100,177




74,184




25,153




840


Adjusted Earnings (Losses) before Interest, Taxes, Depreciation and Amortization, and Pension («Adjusted EBITDAP»)


$

42,469



$

43,346



$

12,315



$

(13,192)


Net sales


$

693,110



$

352,066



$

345,158



$

(4,114)


Adjusted EBITDAP margin



6.3

%



12.6

%



3.7

%


n/a


^ includes goodwill impairment charges




Year Ended March 31, 2020








Segment Data


Adjusted Earnings before Interest, Taxes, Depreciation,

Amortization, and Pension (EBITDAP):


Total



Systems &

Support



Aerospace

Structures



Corporate/

Eliminations*


Net loss


$

(29,433)














Add-back:

















Non-service defined benefit income



(40,587)














Income tax expense



5,798














Interest expense and other, net



122,129














Operating income (loss)


$

57,907



$

141,341



$

41,864



$

(125,298)


Loss on sales of assets & businesses, net



56,916







(10,121)




67,037


Legal judgment gain, net of expenses



(9,257)










(9,257)


Union represented employee incentives



7,071







7,071






Amortization of acquired contract liabilities



(75,286)




(34,486)




(40,800)





Depreciation and amortization ^



204,289




98,497




102,418




3,374


Adjusted Earnings (Losses) before Interest, Taxes, Depreciation and Amortization, and Pension («Adjusted EBITDAP»)


$

241,640



$

205,352



$

100,432



$

(64,144)


Net sales


$

2,900,117



$

1,357,564



$

1,555,887



$

(13,334)


Adjusted EBITDAP margin



8.6

%



15.5

%



6.6

%


n/a


^ includes goodwill impairment charges

(Continued)

FINANCIAL DATA (UNAUDITED)

TRIUMPH GROUP, INC. AND SUBSIDIARIES

(dollars in thousands, except per share data)

Non-GAAP Financial Measure Disclosures (continued)

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

March 31, 2021




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



Year Ended

March 31, 2021




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 cost



15,305




15,305




0.29


Adjusted income from continuing operations – non-GAAP*


$

1,273



$

(1,608)



$

(0.03)


* Differences due to rounding



Three Months Ended

March 31, 2020




Pre-Tax



After-Tax



Diluted EPS


Loss from continuing operations – GAAP


$

(81,800)



$

(75,121)



$

(1.44)


Adjustments:













Loss on sale of assets and businesses, net



1,726




1,726




0.03


Settlements, curtailments, & special termination, net



28,666




28,666




0.55


Goodwill impairment



66,121




66,121




1.27


Restructuring costs



11,850




11,850




0.23


CARES Act tax adjustment






2,747




0.05


Adjusted income from continuing operations – non-GAAP


$

26,563



$

35,989




0.69


(1) As adjusted 

 

(Continued)

FINANCIAL DATA (UNAUDITED)


TRIUMPH GROUP, INC. AND SUBSIDIARIES

(dollars in thousands, except per share data)


Non-GAAP Financial Measure Disclosures (continued)




Year Ended

March 31, 2020




Pre-Tax



After-Tax



Diluted EPS


Loss from continuing operations – GAAP


$

(23,635)



$

(29,433)



$

(0.58)


Adjustments:













Loss on sale of assets and businesses, net



56,916




56,916




1.12


Settlements, curtailments, & special termination, net



14,293




14,293




0.28


Goodwill impairment



66,121




66,121




1.30


Legal settlement gain, net of expenses



(9,257)




(9,257)




(0.18)


Union incentives



7,071




7,071




0.14


Restructuring costs



25,340




25,340




0.50


Refinancing costs



3,030




3,030




0.06


CARES Act tax adjustment






2,747




0.05


Adjusted income from continuing operations – non-GAAP


$

139,879



$

136,828



$

2.69


(1) As adjusted 

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

March 31,



Year Ended

March 31,




2021



2020



2021



2020


Operating (loss) income – GAAP


$

(46,212)



$

(40,302)



$

(326,151)



$

57,907


Adjustments:

















Loss on sale of assets and businesses, net



58,682




1,726




104,702




56,916


Impairment of long-lived assets and goodwill






66,121




252,382




66,121


Impairment of rotable inventory









23,689





Restructuring costs



20,477




11,850




53,224




25,340


Legal judgment gain, net of expenses












(9,257)


Union incentives












7,071


Adjusted operating income – non-GAAP


$

32,947



$

39,395



$

107,846



$

204,098


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

March 31,



Fiscal Year Ended

March 31,




2021



2020



2021



2020


Cash provided by (used in) operating activities


$

22,752



$

57,378



$

(173,119)



$

96,666


Less:

















Capital expenditures



(6,190)




(12,584)




(25,178)




(39,834)


Free cash flow (use)


$

16,562



$

44,794



$

(198,297)



$

56,832


 

Cision View original content:http://www.prnewswire.com/news-releases/triumph-group-reports-fourth-quarter-fiscal-2021-results-301295570.html

SOURCE Triumph Group