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Triumph Group Reports Second Quarter Results

WAYNE, Pa., Oct 29, 2004 (BUSINESS WIRE) -- Triumph Group, Inc. (NYSE:TGI) announced today that for the second quarter of fiscal 2005, the company delivered strong revenue growth across its core business segments, reflecting a strengthening aerospace market.

Net sales from continuing operations for the second quarter of fiscal 2005 totaled $170.0 million, a seventeen percent increase over last year's second quarter sales of $145.1 million. Income from continuing operations for the quarter was $4.9 million, or $0.31 per diluted common share, compared to $7.9 million, or $0.50 per diluted common share, for the same period last year. Net income was $5.7 million, or $0.36 per diluted common share, versus $7.3 million, or $0.46 per diluted common share, last year. During the quarter, the company generated $9.4 million of cash flow from operating activities.

Net sales from continuing operations for the first six months of fiscal 2005 were $335.3 million, a seventeen percent increase over the $285.7 million last year. Income from continuing operations in the first six months of fiscal 2005 was $7.0 million, or $0.44 per diluted common share, compared to $15.6 million, or $0.98 per diluted common share, for the same period in fiscal 2004. Net income was $8.5 million, or $0.54 per diluted common share, compared to net income of $14.4 million, or $0.90 per diluted common share, in the prior year period.

Richard C. Ill, Triumph's President and Chief Executive Officer, said, "As we near the completion of the reorganization that was initiated at the beginning of this fiscal year, we have finalized the realignment of our operations and the organizational structure that will be used to manage our business. This realignment is reflected in a change to reporting our results by operating segments. The Aerospace Systems segment includes the operations that manufacture proprietary and build to print products for the global aerospace OEM market. The Aftermarket Services segment consists of the businesses which focus on the maintenance, repair and overhaul services we provide on a global basis to both commercial and military markets on components and accessories manufactured by third parties."

The Aerospace Systems segment reported net sales for the quarter of $122.1 million, a twenty-three percent increase over the prior year quarter's sales of $98.9 million. Operating income for the current quarter increased twenty-six percent to $14.6 million, compared to $11.6 million in the prior year period.

The Aftermarket Services segment reported net sales for the quarter of $42.4 million, compared to $35.2 million in the prior year period, a twenty percent increase. Operating income for the second quarter of fiscal 2005 was $2.3 million, compared to $3.9 million for the prior year, a forty-one percent decrease.

In the Other segment, which is primarily comprised of activities related to the industrial gas turbine markets, net sales for the quarter decreased thirty-nine percent to $7.5 million, compared to $12.2 million in the prior year period. The segment incurred an operating loss in the current quarter of $3.8 million, compared to an operating loss of $0.4 million in the prior year period.

Mr. Ill said, "After reviewing our strategic alternatives, we have decided to exit the IGT business, which will involve the previously announced plant closure of our Phoenix Manufacturing Division and plans to divest, phase out or consolidate the remaining operations by the end of the calendar year. We anticipate that the costs associated with these actions will fall within the previously announced range of up to $4.0 million."

Commenting on the outlook for the year, Mr. Ill stated, "We are pleased to see a rebound in our commercial aerospace markets and are encouraged by the strong revenue growth across all of our core businesses. As we complete our plan to focus on our core aerospace operations, we believe that the strength of our position in the markets we serve will enable us to capitalize on our market share gains as the aerospace industry continues its recovery."

Triumph Group, Inc., headquartered in Wayne, Pennsylvania, designs, engineers, manufactures, repairs and overhauls aircraft components and industrial gas turbine components and accessories.

The company serves a broad, worldwide spectrum of the aviation industry, including original equipment manufacturers of aircraft and aircraft components as well as commercial, military and air cargo customers.

More information about Triumph can be found on the Internet at http://www.triumphgroup.com.

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. 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's reports filed with the SEC, including our Annual Report on Form 10-K for the year ended March 31, 2004.

                     FINANCIAL DATA  (UNAUDITED)

                 TRIUMPH GROUP, INC. AND SUBSIDIARIES
                (in thousands, except per share data)


                              Three Months Ended   Six Months Ended
                                 September 30,       September 30,
                              ------------------- -------------------
CONDENSED STATEMENTS OF         2004      2003      2004      2003
 INCOME                       --------- --------- --------- ---------

Net Sales                     $169,980  $145,116  $335,333  $285,745

Operating Income                 9,880    12,103    16,327    26,776

Interest Expense and Other       3,210     2,942     6,467     5,775
Income Tax Expense               1,775     1,245     2,860     5,448
                              --------- --------- --------- ---------
Income from Continuing
 Operations                      4,895     7,916     7,000    15,553
Income (Loss) from
 Discontinued Operations           777      (627)    1,531    (1,184)
                              --------- --------- --------- ---------
Net Income                      $5,672    $7,289    $8,531   $14,369
                              ========= ========= ========= =========

Earnings Per Share - Basic:

Income from Continuing
 Operations                      $0.31     $0.50     $0.44     $0.98
Income (Loss) from
 Discontinued Operations         $0.05    ($0.04)    $0.10    ($0.07)
                              --------- --------- --------- ---------
Net Income                       $0.36     $0.46     $0.54     $0.91
                              ========= ========= ========= =========
Weighted average common
 shares outstanding - Basic     15,868    15,836    15,864    15,836
                              ========= ========= ========= =========

Earnings Per Share - Diluted:

Income from Continuing
 Operations                      $0.31     $0.50     $0.44     $0.98
Income (Loss) from
 Discontinued Operations         $0.05    ($0.04)    $0.10    ($0.07)
                              --------- --------- --------- ---------
Net Income                       $0.36     $0.46     $0.54   $0.90(1)
                              ========= ========= ========= =========
Weighted average common
 shares outstanding - Diluted   15,942    15,904    15,939    15,894
                              ========= ========= ========= =========

(1) Difference due to rounding.





                      FINANCIAL DATA (UNAUDITED)

                 TRIUMPH GROUP, INC. AND SUBSIDIARIES
            (dollars in thousands, except per share data)

BALANCE SHEET
                                            September 30,  March 31,
                                                2004         2004
                                            ------------- ------------
                      Assets
Cash                                              $6,241       $6,766
Accounts Receivable, net                         119,005      122,273
Inventory                                        214,235      206,751
Assets held for sale                              31,293       28,296
Income Tax Refund Receivable                       4,339        8,829
Prepaid Expenses and Other                         4,945        3,801
                                            ------------- ------------
     Current Assets                              380,058      376,716

Property and Equipment, net                      243,944      248,626
Goodwill                                         267,937      267,621
Intangible Assets, net                            25,375       27,514
Other                                             16,070       15,371
                                            ------------- ------------
Total Assets                                    $933,384     $935,848
                                            ============= ============

        Liabilities & Stockholders' Equity

Accounts Payable                                 $52,852      $55,259
Accrued Expenses                                  50,871       49,771
Liabilities related to assets held for
 sale                                             11,533        8,809
Income Taxes Payable                               3,611        1,533
Deferred Income Taxes                              1,444        1,444
Current Portion of Long-Term Debt                  4,475        4,884
                                            ------------- ------------
       Current Liabilities                       124,786      121,700

Long-Term Debt, less current portion             206,221      220,963
Deferred Income Taxes and Other                   78,350       78,069

Stockholders' Equity:
       Common Stock, $.001 par value,
        50,000,000 shares authorized,
        16,027,324 shares issued                      16           16
Capital in excess of par value                   259,330      259,322
Treasury Stock, at cost, 167,260
 shares                                           (3,879)      (4,152)
Accumulated other comprehensive income             1,507        1,408
Retained earnings                                267,053      258,522
                                            ------------- ------------
       Total Stockholders' Equity                524,027      515,116
                                            ------------- ------------
Total Liabilities and Stockholders'
 Equity                                         $933,384     $935,848
                                            ============= ============






                      FINANCIAL DATA (UNAUDITED)

                 TRIUMPH GROUP, INC. AND SUBSIDIARIES
                        (dollars in thousands)



SEGMENT DATA                   Three Months Ended   Six Months Ended
                                  September 30,       September 30,
                               ------------------- -------------------
                                 2004      2003      2004      2003
                               --------- --------- --------- ---------

Net Sales:
   Aerospace Systems           $122,090   $98,944  $241,506  $193,598
   Aftermarket Services          42,421    35,212    82,162    67,347
   Other                          7,467    12,201    15,197    26,966
   Elimination of inter-segment
    sales                        (1,998)   (1,241)   (3,532)   (2,166)
                               --------- --------- --------- ---------
                               $169,980  $145,116  $335,333  $285,745
                               ========= ========= ========= =========

Operating Income (Expense):
   Aerospace Systems            $14,600   $11,563   $25,909   $23,205
   Aftermarket Services           2,295     3,879     3,561     6,844
   Other                         (3,780)     (426)   (6,933)    2,083
   Corporate                     (3,235)   (2,913)   (6,210)   (5,356)
                               --------- --------- --------- ---------
                                 $9,880   $12,103   $16,327   $26,776
                               ========= ========= ========= =========

Depreciation and Amortization:
   Aerospace Systems             $4,640    $3,831    $9,337    $7,407
   Aftermarket Services           2,092     1,878     4,163     3,762
   Other                            745       892     1,505     1,878
   Corporate                         32        31        75        64
                               --------- --------- --------- ---------
                                 $7,509    $6,632   $15,080   $13,111
                               ========= ========= ========= =========

Capital Expenditures:
   Aerospace Systems             $5,814    $4,564    $7,874   $10,377
   Aftermarket Services           1,015     1,010     1,896     2,287
   Other                             17     1,403        24     1,500
   Corporate                          8        29        34        53
                               --------- --------- --------- ---------
                                 $6,854    $7,006    $9,828   $14,217
                               ========= ========= ========= =========





                      FINANCIAL DATA (UNAUDITED)

                 TRIUMPH GROUP, INC. AND SUBSIDIARIES
                        (dollars in thousands)


Non-GAAP Financial Measure Disclosures


Earnings before Interest, Taxes, Depreciation and Amortization
("EBITDA") for the three months ended September 30, 2004 was $17.4
million with a margin of 10.2%. EBITDA for the three months ended
September 30, 2003 was $18.7 million with a margin of 12.9%. EBITDA
for the six months ended September 30, 2004 was $31.4 million with a
margin of 9.4%. EBITDA for the six months ended September 30, 2003 was
$39.9 million with a margin of 14.0%.

Management believes that EBITDA provides investors with an
important perspective on the current underlying performance of the
business by identifying non-cash expenses, interest and taxes included
in income from continuing operations.

The following definition is provided for the non-GAAP financial
measure identified above, together with a reconciliation of such
non-GAAP financial measure to the most directly comparable financial
measure calculated and presented in accordance with GAAP.


                               Three Months Ended   Six Months Ended
                                  September 30,       September 30,
                               ------------------- -------------------
                                  2004      2003     2004      2003
                               --------- --------- --------- ---------

Earnings before Interest,
 Taxes, Depreciation and
 Amortization (EBITDA):


   Income from Continuing
    Operations                   $4,895    $7,916    $7,000   $15,553

   Add-back:
     Income Tax Expense           1,775     1,245     2,860     5,448
     Interest Expense and Other   3,210     2,942     6,467     5,775
     Depreciation and
      Amortization                7,509     6,632    15,080    13,111
                               --------- --------- --------- ---------

   Earnings before Interest,
    Taxes, Depreciation and
    Amortization ("EBITDA")     $17,389   $18,735   $31,407   $39,887
                               --------- --------- --------- ---------

   Net Sales                   $169,980  $145,116  $335,333  $285,745
                               --------- --------- --------- ---------

   EBITDA Margin                   10.2%     12.9%      9.4%     14.0%
                               ========= ========= ========= =========

SOURCE: Triumph Group, Inc.

Triumph Group, Inc.
John Bartholdson, 610-251-1000

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