DJ Somero Enterprises Inc. Interim Results
Somero Enterprises, Inc. is pleased to report its interim results for the six months ended June 30, 2016.
Financial Highlights
H1 2016 H1 2015 % Increase
Revenue US$39.7m US$35.3m 12%
Adjusted EBITDA(1,2) US$12.1m US$9.5m 27%
Adjusted EBITDA Margin(1,2) 30% 27%
Operating Income US$10.3m US$8.3m 24%
Adjusted Net Income(1,3) US$7.3m US$6.0m 22%
Diluted Adjusted Net
Income Per Share(1,3,4) US$0.13 US$0.10 30%
— Broad-based geographic growth led by core markets and strong demand for new products:
— Revenue increased 12% to US$ 39.7m (H1 2015: US$ 35.3m)
— Effective conversion of revenue growth into profit:
— Adjusted EBITDA increased 27% to US$ 12.1m (H1 2015: US$ 9.5m)(1,2)
— Adjusted EBITDA margin grew to 30% (H1 2015: 27%) (1,2)
— Operating income increased 24% to US$ 10.3m (H1 2015: US$ 8.3m)
— Adjusted net income increased 22% to US$ 7.3m (H1 2015: US$ 6.0m)(1,3)
— Diluted adjusted net income per share grew 30% to US$ 0.13 (H1 2015: US$ 0.10) (1,3,4)
— Net cash flow from operations was US$5.8m (H1 2015: US$7.3m) with the change driven primarily by increased working capital investment and timing of income tax payments
— Balance sheet continues to strengthen and reflect long-term investment:
— Investment in new Global Headquarters and Training Facility in Fort Myers, Florida completed with US$ 3.3 spend in H1 2016
— Strong net cash position at June 30, 2016 of US$ 11.1m (December 31, 2015: US$ 12.6m) despite capital expenditures related to construction and US $ 2.8M in dividend payments in H1 2016 (4)
— Increased dividend payment to shareholders:
— 2.5 US cents per share declared for payment in H2 2016; a 32% increase over last year
Business Highlights
— Six of 11 regions delivered sales growth compared to H1 2015, led by core markets:
— The North American market was very strong, with sales increasing to US$ 29.8m, a 24% increase compared to H1 2015
— EMEA sales increased 13% compared to H1 2015 led by Europe which grew to US$ 2.6m in H1 2016 (H1 2015: US$ 1.9m)
— Sales in China increased 15% to US$ 3.8m compared to H1 2015
— Strong demand for new products – Mid line and Small line machines, 3-D Profiler Systems, and growth in Other revenues were significant contributors to the strong H1 2016 performance:
— S-10A and S-940 Laser Screed machines contributed combined sales of US$ 5.1m in H1 2016
— 3-D Profiler System sales increased to US$ 3.0m, up 50% from H1 2015
— Other revenues increased to US$ 8.1m, up 45% from H1 2015, driven by growth in sales of parts and services and the STS-11m Spreader
— Construction completed on new Global Headquarters and Training Facility in Fort Myers, Florida
— Building officially opened April 2016 on budget at a total project cost of US $ 4.8m
Notes:
1. The Company uses non-US GAAP financial measures in order to provide supplemental information regarding the Company's operating performance. See further information regarding non-GAAP measures below.
2. Adjusted EBITDA as used herein is a calculation of the Company's net income plus tax provision, interest expense, interest income, foreign exchange gain/(loss), other expense, depreciation, amortization, and stock based compensation.
3. Adjusted net income as used herein is a calculation of net income plus amortization of intangibles and excluding the tax impact of stock option and RSU settlements and other special items.
4. Net cash is defined as cash and cash equivalents less borrowings under bank obligations.
Commenting, Jack Cooney, President and Chief Executive Officer of Somero, said:
“Somero Enterprises, Inc. is pleased to announce that the healthy trading momentum referred to in the Company's 12 July 2016 trading update has continued. Revenue grew 12% and Operating Income by 24% compared to H1 2015 with six of 11 regions reporting increased sales, led by strong performance in the Company's core North American, European and Chinese markets. On a product basis, the strong H1 2016 performance was driven by robust demand for recently launched new products – Mid line and Small line machines, 3-D Profiler Systems, and growth in Other revenues. Due to the solid H1 2016 results and continued healthy trading environment, the Board expects another successful year of growth in line with current market expectations.”