SPX FLOW, INC. (NYSE:FLOW) Files An 8-K Results of Operations and Financial Condition
Item 2.02. Results of Operations and Financial Condition.
On February5, 2019, SPX FLOW, Inc. (the “Company”) issued the press release attached as Exhibit99.1 hereto and incorporated herein by reference.
The press release incorporated by reference into this Item 2.02 contains disclosure regarding organic revenue growth (decline), defined as net revenue growth (decline) excluding the effects of (i) foreign currency fluctuations as well as (ii) the impact of the new revenue recognition standard which the Company adopted on a modified retrospective basis effective January 1, 2018. The Company’s management believes that this metric is a useful financial measure for investors in evaluating its operating performance because excluding the effect of currency fluctuations and the net impact related to the adoption of the new revenue recognition standard, when read in conjunction with the Company’s revenues, presents a useful tool to evaluate the Company’s ongoing operations and provides investors with a tool they can use to evaluate the Company’s management of assets held from period to period. In addition, organic revenue growth (decline) is one of the factors the Company’s management uses in internal evaluations of the overall performance of its business.
The press release also contains disclosure regarding net debt, defined as total debt net of cash and equivalents. The Company views this measure, when read in conjunction with its comparable GAAP amount, as giving investors a useful tool to assess the financial health and leverage of the Company. Additionally, the Company’s management uses this metric as a measure of the Company’s leverage.
In the three and twelve months ended December 31, 2018, we recognized asset impairment charges of $14.6 and restructuring and other related costs of $3.5 primarily associated with the rationalization of a Food and Beverage segment business. In the three and twelve months ended December 31, 2018 and 2017, we recognized various discrete charges or benefits in our tax provision (benefit) related to changes to existing U.S. tax law that resulted from the enactment of the Tax Cuts and Jobs Act in December 2017. In 2017, we finalized the execution of a multi-year, global realignment plan to transition our organization to an operating structure, improve our competitive position and increase our ability to serve customers (“global realignment program”), to which we incurred costs in 2017 toward restructuring actions and certain tangible long-lived asset impairments. To aid investors who seek comparability period-to-period, the Company, in the press release incorporated by reference into this Item 2.02, adjusted certain metrics to exclude these and certain other charges (benefits). These metrics include disclosure of:
|
(i) |
adjusted operating income, which is defined as operating income excluding asset impairment charges and certain restructuring and other related charges as described above; |
|
(ii) |
EBITDA, which is defined as net income (loss) attributable to SPX FLOW, Inc. excluding income tax provision (benefit), net interest expense, and depreciation and amortization; |
|
(iii) |
adjusted EBITDA, which is defined as EBITDA excluding asset impairment charges and certain restructuring and other related charges as described above, and |
|
(iv) |
adjusted diluted earnings per share (“EPS”), which is defined as diluted earnings (loss) per share excluding the dilutive EPS effects of asset impairment charges and certain restructuring and other related charges (both net of tax), and discrete tax charges (benefits) primarily related to the effects of the U.S. tax law changes to the Tax Cuts and Jobs Act and other items, as described above. |
The Company views each of the above measures, when read in conjunction with their comparable GAAP number or amount, as giving investors useful tools to assess the health and prospects of the Company. Additionally, the Company’s management uses these adjusted metrics as measures of the Company’s performance.
The press release also contains disclosure regarding free cash flow from operations, defined as net cash from operations reduced by cash paid for capital expenditures. The Company’s management believes that free cash flow from operations is a useful financial measures for investors in evaluating the cash flow performance of multi-industrial companies, since the measure provides insight into the cash flow available to fund such things as equity repurchases, dividends, mandatory and discretionary debt reduction and acquisitions or other strategic investments. In addition, although the use of free cash flow from operations is limited by the fact that the measure can exclude certain cash items within management’s discretion, free cash flow from operations is a factor used by the Company’s management in internal evaluations of the overall performance of its business.
None of the non-GAAP measures described above is a measure of financial performance under accounting principles generally accepted in the United States (“GAAP”), and such measures should not be considered a substitute for, and should be used in combination with, the GAAP number or amount from which each is reconciled. Non-GAAP measures used by the Company may not be comparable to similarly titled measures reported by other companies.
Refer to the tables included in the press release for the components of each of the Company’s non-GAAP numbers or amounts referred to above, and for the reconciliations of these numbers or amounts from their respective most comparable GAAP measures.
The information in this Report is being furnished and shall not be deemed “filed” for the purposes of Section18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Report shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
Item 9.01.Financial Statements and Exhibits.
|
Exhibit Number |
Description |
|
Press Release issued February 5, 2019, furnished solely to Item 2.02 of Form8-K. |
SPX FLOW, Inc. Exhibit
EX-99.1 2 ex991-fy2018earningsrelease.htm EXHIBIT 99.1 – FLOW FY2018 EARNINGS RELEASE Exhibit Exhibit 99.1SPX FLOW REPORTS FOURTH QUARTER AND FULL YEAR 2018 RESULTS; JOURNEY TO HIGH-PERFORMANCE CULTURE CONTINUES IN 2019●Upbeat Q4 2018 with Organic Revenue Growth and Margin Expansion ○Revenues up 2% Year-Over-Year; 5% Organic* Revenue Growth Includes 13% Growth in Industrial Segment ○Segment Income Margins Up 70 Points Year-Over-Year ○Orders Steady Sequentially with 1% Organic Growth from Q3 to Q4 ●2018 Full Year Results Show Progress on Journey to High-Performance Culture ○7% Revenue Growth; 5% Organic* Revenue Growth ○19% Growth in Adjusted EBITDA* and 200 Points of Operating Margin Expansion ○Executed High Value Product Line Strategy; 6% Organic Order Growth in Aggressive Investment Products ○Reduced Gross Debt 14%; Reduced Gross Leverage to 2.8x,…
To view the full exhibit click here
About SPX FLOW, INC. (NYSE:FLOW)
SPX FLOW, Inc. is a global supplier of engineered solutions. The Company engineers, designs, manufactures and markets products and solutions used to process, blend, filter, dry, meter and transport fluids with a focus on original equipment installation, including turn-key systems, modular systems and components, as well as aftermarket components and support services. The Company operates through three segments: Food and Beverage; Power and Energy, and Industrial. The Company’s product portfolio includes pumps, valves, mixers, filters, air dryers, hydraulic tools, homogenizers, separators and heat exchangers, along with the related aftermarket parts and services. It supports global industries, including food and beverage; oil and gas; power generation, including nuclear and conventional; chemical processing, and compressed air and mining. Its brands include Anhydro, APV, Bran+Luebbe, Gerstenberg Schroeder, LIGHTNIN, Seital and Waukesha Cherry-Burrell.
