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• | Revenue was $331 million, increasing 12 percent from a year ago on a reported basis and 14 percent on a constant currency basis, driven by strong organic growth across the company’s core product portfolio. |
• | GAAP operating income was $40 million or 12.1 percent of sales, compared to $40 million or 13.5 percent of sales in the same period a year ago. Adjusted operating income increased 20 percent to $57 million or 17.2 percent of sales, compared to $47 million or 16.0 percent of sales in the same period a year ago. |
• | GAAP earnings were $34 million or $0.86 per diluted share, compared to $32 million or $0.83 per diluted share in the same period a year ago. Adjusted earnings increased 27 percent to $45 million or $1.16 per diluted share, compared to $35 million or $0.92 per diluted share in the same period a year ago. |
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Net sales | $ | 331,096 | $ | 296,129 | $ | 996,320 | $ | 850,669 | ||||||||
Cost of products sold | 182,794 | 163,926 | 546,844 | 465,780 | ||||||||||||
Gross profit | 148,302 | 132,203 | 449,476 | 384,889 | ||||||||||||
Selling, general and administrative | 78,013 | 72,852 | 240,226 | 223,741 | ||||||||||||
Research and development | 13,296 | 12,351 | 39,752 | 35,282 | ||||||||||||
Restructuring charges | 2,615 | 3,214 | 10,223 | 16,920 | ||||||||||||
Currency exchange (gains) losses, net | (252 | ) | 562 | 2,571 | 3,994 | |||||||||||
Other operating expense | 14,627 | 3,346 | 25,469 | 32,956 | ||||||||||||
Operating income | 40,003 | 39,878 | 131,235 | 71,996 | ||||||||||||
Interest expense | 4,492 | 3,961 | 14,454 | 10,566 | ||||||||||||
Loss on extinguishment of debt | 1,494 | — | 1,494 | — | ||||||||||||
Other income, net | (4,252 | ) | (1,720 | ) | (8,292 | ) | (4,406 | ) | ||||||||
Total other expense, net | 1,734 | 2,241 | 7,656 | 6,160 | ||||||||||||
Income before income taxes | 38,269 | 37,637 | 123,579 | 65,836 | ||||||||||||
Provision for income taxes | 4,206 | 5,411 | 23,606 | 6,306 | ||||||||||||
Net income | 34,063 | 32,226 | 99,973 | 59,530 | ||||||||||||
Net income attributable to noncontrolling interests | (346 | ) | (160 | ) | (706 | ) | (519 | ) | ||||||||
Net income attributable to MSA Safety Incorporated | $ | 33,717 | $ | 32,066 | $ | 99,267 | $ | 59,011 | ||||||||
Earnings per share attributable to MSA Safety Incorporated common shareholders: | ||||||||||||||||
Basic | $ | 0.88 | $ | 0.84 | $ | 2.59 | $ | 1.55 | ||||||||
Diluted | $ | 0.86 | $ | 0.83 | $ | 2.55 | $ | 1.52 | ||||||||
Basic shares outstanding | 38,417 | 38,074 | 38,328 | 37,970 | ||||||||||||
Diluted shares outstanding | 39,036 | 38,702 | 38,914 | 38,692 |
September 30, 2018 | December 31, 2017 | ||||||
Assets | |||||||
Cash and cash equivalents | $ | 118,161 | $ | 134,244 | |||
Trade receivables, net | 236,245 | 244,198 | |||||
Inventories | 183,829 | 153,739 | |||||
Notes receivable, insurance companies | 3,525 | 17,333 | |||||
Other current assets | 131,577 | 72,783 | |||||
Total current assets | 673,337 | 622,297 | |||||
Property, net | 150,569 | 157,014 | |||||
Prepaid pension cost | 91,914 | 83,060 | |||||
Goodwill | 416,779 | 422,185 | |||||
Notes receivable, insurance companies, noncurrent | 60,726 | 59,567 | |||||
Insurance receivable, noncurrent | 49,280 | 123,089 | |||||
Other noncurrent assets | 208,078 | 217,614 | |||||
Total assets | $ | 1,650,683 | $ | 1,684,826 | |||
Liabilities and shareholders' equity | |||||||
Notes payable and current portion of long-term debt, net | $ | 20,005 | $ | 26,680 | |||
Accounts payable | 71,659 | 87,061 | |||||
Other current liabilities | 216,283 | 175,538 | |||||
Total current liabilities | 307,947 | 289,279 | |||||
Long-term debt, net | 370,195 | 447,832 | |||||
Pensions and other employee benefits | 167,373 | 170,773 | |||||
Deferred tax liabilities | 8,973 | 9,341 | |||||
Product liability and other noncurrent liabilities | 136,489 | 165,023 | |||||
Total shareholders' equity | 659,706 | 602,578 | |||||
Total liabilities and shareholders' equity | $ | 1,650,683 | $ | 1,684,826 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income | $ | 34,063 | $ | 32,226 | $ | 99,973 | $ | 59,530 | |||||||
Depreciation and amortization | 9,378 | 9,929 | 28,585 | 27,665 | |||||||||||
Change in working capital and other operating | 77,374 | 809 | 57,639 | 102,051 | |||||||||||
Cash flow from operating activities | 120,815 | 42,964 | 186,197 | 189,246 | |||||||||||
Capital expenditures | (9,808 | ) | (5,603 | ) | (18,620 | ) | (11,730 | ) | |||||||
Acquisition, net of cash acquired | — | (213,990 | ) | — | (213,990 | ) | |||||||||
Purchase of short-term investments | (57,090 | ) | — | (57,090 | ) | — | |||||||||
Property disposals | 942 | 52 | 4,001 | 729 | |||||||||||
Cash flow used in investing activities | (65,956 | ) | (219,541 | ) | (71,709 | ) | (224,991) | ||||||||
Change in debt | (38,390 | ) | 200,540 | (80,675 | ) | 75,900 | |||||||||
Cash dividends paid | (14,624 | ) | (13,376 | ) | (42,605 | ) | (39,200 | ) | |||||||
Company stock purchases under repurchase program | — | (11,781 | ) | — | (11,781 | ) | |||||||||
Other financing | (1,313 | ) | (346 | ) | (575 | ) | 7,209 | ||||||||
Cash flow (used in) provided by financing activities | (54,327 | ) | 175,037 | (123,855 | ) | 32,128 | |||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (1,822 | ) | (1,705 | ) | (9,952 | ) | 1,622 | ||||||||
Decrease in cash, cash equivalents and restricted cash | $ | (1,290 | ) | $ | (3,245 | ) | $ | (19,319 | ) | $ | (1,995 | ) |
Americas | International | Corporate | Consolidated | ||||||||||||
Three Months Ended September 30, 2018 | |||||||||||||||
Sales to external customers | $ | 209,343 | $ | 121,753 | $ | — | $ | 331,096 | |||||||
Operating income | 40,003 | ||||||||||||||
Operating margin % | 12.1 | % | |||||||||||||
Restructuring charges | 2,615 | ||||||||||||||
Currency exchange gains, net | (252 | ) | |||||||||||||
Other operating expense | 14,627 | ||||||||||||||
Strategic transaction costs | 56 | ||||||||||||||
Adjusted operating income (loss) | 51,532 | 13,329 | (7,812 | ) | 57,049 | ||||||||||
Adjusted operating margin % | 24.6 | % | 10.9 | % | 17.2 | % | |||||||||
Three Months Ended September 30, 2017 | |||||||||||||||
Sales to external customers | $ | 186,898 | $ | 109,231 | $ | — | $ | 296,129 | |||||||
Operating income | 39,878 | ||||||||||||||
Operating margin % | 13.5 | % | |||||||||||||
Restructuring charges | 3,214 | ||||||||||||||
Currency exchange losses, net | 562 | ||||||||||||||
Other operating expense | 3,346 | ||||||||||||||
Strategic transaction costs | 386 | ||||||||||||||
Adjusted operating income (loss) | 45,365 | 10,229 | (8,208 | ) | 47,386 | ||||||||||
Adjusted operating margin % | 24.3 | % | 9.4 | % | 16.0 | % |
Americas | International | Corporate | Consolidated | ||||||||||||
Nine Months Ended September 30, 2018 | |||||||||||||||
Sales to external customers | $ | 633,812 | $ | 362,508 | $ | — | $ | 996,320 | |||||||
Operating income | 131,235 | ||||||||||||||
Operating margin % | 13.2 | % | |||||||||||||
Restructuring charges | 10,223 | ||||||||||||||
Currency exchange losses, net | 2,571 | ||||||||||||||
Other operating expense | 25,469 | ||||||||||||||
Strategic transaction costs | 208 | ||||||||||||||
Adjusted operating income (loss) | 151,456 | 41,960 | (23,710 | ) | 169,706 | ||||||||||
Adjusted operating margin % | 23.9 | % | 11.6 | % | 17.0 | % | |||||||||
Nine Months Ended September 30, 2017 | |||||||||||||||
Sales to external customers | $ | 528,426 | $ | 322,243 | $ | — | $ | 850,669 | |||||||
Operating income | 71,996 | ||||||||||||||
Operating margin % | 8.5 | % | |||||||||||||
Restructuring charges | 16,920 | ||||||||||||||
Currency exchange losses, net | 3,994 | ||||||||||||||
Other operating expense | 32,956 | ||||||||||||||
Strategic transaction costs | 3,365 | ||||||||||||||
Adjusted operating income (loss) | 125,087 | 30,146 | (26,002 | ) | 129,231 | ||||||||||
Adjusted operating margin % | 23.7 | % | 9.4 | % | 15.2 | % |
Three Months Ended September 30, 2018 | ||||||||||||||||||||
Breathing Apparatus | Firefighter Helmets and Protective Apparel(a) | Industrial Head Protection | Portable Gas Detection | Fixed Gas and Flame Detection | Fall Protection | Core Sales | Non-Core Sales | Net Sales | ||||||||||||
GAAP reported sales change | 22 | % | 12 | % | 7 | % | 11 | % | 6 | % | 13 | % | 12 | % | 9 | % | 12 | % | ||
Plus: Currency translation effects | 1 | % | 1 | % | 4 | % | 2 | % | 1 | % | 2 | % | 2 | % | 3 | % | 2 | % | ||
Constant currency sales change | 23 | % | 13 | % | 11 | % | 13 | % | 7 | % | 15 | % | 14 | % | 12 | % | 14 | % | ||
Less: Acquisitions | — | % | 29 | % | — | % | — | % | — | % | — | % | 1 | % | — | % | 1 | % | ||
Organic constant currency change | 23 | % | (16 | )% | 11 | % | 13 | % | 7 | % | 15 | % | 13 | % | 12 | % | 13 | % |
Nine Months Ended September 30, 2018 | ||||||||||||||||||||
Breathing Apparatus | Firefighter Helmets and Protective Apparel(a) | Industrial Head Protection | Portable Gas Detection | Fixed Gas and Flame Detection | Fall Protection | Core Sales | Non-Core Sales | Net Sales | ||||||||||||
GAAP reported sales change | 12 | % | 110 | % | 10 | % | 13 | % | 10 | % | 10 | % | 20 | % | 4 | % | 17 | % | ||
Plus: Currency translation effects | (1 | )% | (2 | )% | 1 | % | (1 | )% | (2 | )% | (1 | )% | (2 | )% | (1 | )% | (1 | )% | ||
Constant currency sales change | 11 | % | 108 | % | 11 | % | 12 | % | 8 | % | 9 | % | 18 | % | 3 | % | 16 | % | ||
Less: Acquisitions | — | % | 113 | % | — | % | — | % | — | % | — | % | 9 | % | — | % | 8 | % | ||
Organic constant currency change | 11 | % | (5 | )% | 11 | % | 12 | % | 8 | % | 9 | % | 9 | % | 3 | % | 8 | % |
Three Months Ended September 30, 2018 | ||||||||||||||||||||
Breathing Apparatus | Firefighter Helmets and Protective Apparel(a) | Industrial Head Protection | Portable Gas Detection | Fixed Gas and Flame Detection | Fall Protection | Core Sales | Non-Core Sales | Net Sales | ||||||||||||
GAAP reported sales change | 23 | % | 20 | % | 5 | % | 12 | % | 4 | % | 20 | % | 14 | % | (2 | )% | 12 | % | ||
Plus: Currency translation effects | 1 | % | — | % | 4 | % | 2 | % | 1 | % | 2 | % | 1 | % | 3 | % | 2 | % | ||
Constant currency sales change | 24 | % | 20 | % | 9 | % | 14 | % | 5 | % | 22 | % | 15 | % | 1 | % | 14 | % | ||
Less: Acquisitions | — | % | 32 | % | — | % | — | % | — | % | — | % | 2 | % | — | % | 2 | % | ||
Organic constant currency change | 24 | % | (12 | )% | 9 | % | 14 | % | 5 | % | 22 | % | 13 | % | 1 | % | 12 | % |
Nine Months Ended September 30, 2018 | ||||||||||||||||||||
Breathing Apparatus | Firefighter Helmets and Protective Apparel(a) | Industrial Head Protection | Portable Gas Detection | Fixed Gas and Flame Detection | Fall Protection | Core Sales | Non-Core Sales | Net Sales | ||||||||||||
GAAP reported sales change | 8 | % | 177 | % | 9 | % | 13 | % | 9 | % | 16 | % | 24 | % | (5 | )% | 20 | % | ||
Plus: Currency translation effects | 1 | % | 1 | % | 3 | % | 1 | % | — | % | 1 | % | 1 | % | 2 | % | 1 | % | ||
Constant currency sales change | 9 | % | 178 | % | 12 | % | 14 | % | 9 | % | 17 | % | 25 | % | (3 | )% | 21 | % | ||
Less: Acquisitions | — | % | 183 | % | — | % | — | % | — | % | — | % | 15 | % | — | % | 12 | % | ||
Organic constant currency change | 9 | % | (5 | )% | 12 | % | 14 | % | 9 | % | 17 | % | 10 | % | (3 | )% | 9 | % |
Three Months Ended September 30, 2018 | ||||||||||||||||||||
Breathing Apparatus | Firefighter Helmets and Protective Apparel(a) | Industrial Head Protection | Portable Gas Detection | Fixed Gas and Flame Detection | Fall Protection | Core Sales | Non-Core Sales | Net Sales | ||||||||||||
GAAP reported sales change | 19 | % | (18 | )% | 14 | % | 8 | % | 7 | % | 4 | % | 9 | % | 23 | % | 11 | % | ||
Plus: Currency translation effects | 4 | % | 1 | % | 4 | % | 4 | % | 2 | % | 2 | % | 3 | % | 4 | % | 3 | % | ||
Constant currency sales change | 23 | % | (17 | )% | 18 | % | 12 | % | 9 | % | 6 | % | 12 | % | 27 | % | 14 | % | ||
Less: Acquisitions | — | % | 2 | % | — | % | — | % | — | % | — | % | 1 | % | — | % | — | % | ||
Organic constant currency change | 23 | % | (19 | )% | 18 | % | 12 | % | 9 | % | 6 | % | 11 | % | 27 | % | 14 | % |
Nine Months Ended September 30, 2018 | ||||||||||||||||||||
Breathing Apparatus | Firefighter Helmets and Protective Apparel(a) | Industrial Head Protection | Portable Gas Detection | Fixed Gas and Flame Detection | Fall Protection | Core Sales | Non-Core Sales | Net Sales | ||||||||||||
GAAP reported sales change | 20 | % | 3 | % | 13 | % | 13 | % | 11 | % | 3 | % | 12 | % | 14 | % | 12 | % | ||
Plus: Currency translation effects | (5 | )% | (6 | )% | (3 | )% | (4 | )% | (5 | )% | (4 | )% | (5 | )% | (4 | )% | (4 | )% | ||
Constant currency sales change | 15 | % | (3 | )% | 10 | % | 9 | % | 6 | % | (1 | )% | 7 | % | 10 | % | 8 | % | ||
Less: Acquisitions | — | % | 2 | % | — | % | — | % | — | % | — | % | — | % | — | % | — | % | ||
Organic constant currency change | 15 | % | (5 | )% | 10 | % | 9 | % | 6 | % | (1 | )% | 7 | % | 10 | % | 8 | % |
Three Months Ended September 30, 2018 | ||||||||
Consolidated | Americas | International | ||||||
Breathing Apparatus | 23 | % | 24 | % | 23 | % | ||
Fall Protection | 15 | % | 22 | % | 6 | % | ||
Portable Gas Detection | 13 | % | 14 | % | 12 | % | ||
Firefighter Helmets and Protective Apparel(a) | 13 | % | 20 | % | (17 | )% | ||
Industrial Head Protection | 11 | % | 9 | % | 18 | % | ||
Fixed Gas and Flame Detection | 7 | % | 5 | % | 9 | % | ||
Core Sales | 14 | % | 15 | % | 12 | % | ||
Core excluding Acquisitions | 13 | % | 13 | % | 11 | % | ||
Non-Core Sales | 12 | % | 1 | % | 27 | % | ||
Net Sales | 14 | % | 14 | % | 14 | % | ||
Net Sales excluding Acquisitions | 13 | % | 12 | % | 14 | % |
Nine Months Ended September 30, 2018 | ||||||||
Consolidated | Americas | International | ||||||
Breathing Apparatus | 11 | % | 9 | % | 15 | % | ||
Fall Protection | 9 | % | 17 | % | (1 | )% | ||
Portable Gas Detection | 12 | % | 14 | % | 9 | % | ||
Firefighter Helmets and Protective Apparel(a) | 108 | % | 178 | % | (3 | )% | ||
Industrial Head Protection | 11 | % | 12 | % | 10 | % | ||
Fixed Gas and Flame Detection | 8 | % | 9 | % | 6 | % | ||
Core Sales | 18 | % | 25 | % | 7 | % | ||
Core excluding Acquisitions | 9 | % | 10 | % | 7 | % | ||
Non-Core Sales | 3 | % | (3 | )% | 10 | % | ||
Net Sales | 16 | % | 21 | % | 8 | % | ||
Net Sales excluding Acquisitions | 8 | % | 9 | % | 8 | % |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||
2018 | 2017 | % Change | 2018 | 2017 | % Change | ||||||||||||||
Net income attributable to MSA Safety Incorporated | $ | 33,717 | $ | 32,066 | 5% | $ | 99,267 | $ | 59,011 | 68% | |||||||||
Tax benefit associated with U.S. Tax Reform | (1,956 | ) | — | (1,956 | ) | — | |||||||||||||
Tax benefit associated with European reorganization | — | (2,474 | ) | — | (2,474 | ) | |||||||||||||
Tax benefit associated with ASU 2016-09: Improvements to employee share-based payment accounting | (430 | ) | (98 | ) | (2,306 | ) | (6,910 | ) | |||||||||||
Subtotal | 31,331 | 29,494 | 6% | 95,005 | 49,627 | 91% | |||||||||||||
Restructuring charges | 2,615 | 3,214 | 10,223 | 16,920 | |||||||||||||||
Currency exchange (gains) losses, net | (252 | ) | 562 | 2,571 | 3,994 | ||||||||||||||
Loss on extinguishment of debt | 1,494 | — | 1,494 | — | |||||||||||||||
Other operating expense | 14,627 | 3,346 | 25,469 | 32,956 | |||||||||||||||
Strategic transaction costs | 56 | 386 | 208 | 3,365 | |||||||||||||||
Asset related (gain) losses and other, net | (733 | ) | 30 | 415 | 274 | ||||||||||||||
Income tax expense on adjustments | (4,024 | ) | (1,598 | ) | (9,645 | ) | (16,367 | ) | |||||||||||
Adjusted earnings | $ | 45,114 | $ | 35,434 | 27% | $ | 125,740 | $ | 90,769 | 39% | |||||||||
Adjusted earnings per diluted share | $ | 1.16 | $ | 0.92 | 26% | $ | 3.23 | $ | 2.35 | 37% |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||
Cash flow from operating activities | $ | 120,815 | $ | 42,964 | $ | 186,197 | $ | 189,246 | |||||||
Capital expenditures | (9,808 | ) | (5,603 | ) | (18,620 | ) | (11,730 | ) | |||||||
Free cash flow | $ | 111,007 | $ | 37,361 | $ | 167,577 | $ | 177,516 | |||||||
Net income attributable to MSA Safety Incorporated | $ | 33,717 | $ | 32,066 | $ | 99,267 | $ | 59,011 | |||||||
Free cash flow conversion | 329% | 117% | 169% | 301% |
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Compare this 8-K Corporate News to its predecessor by reading our highlights to see what text and tables were removed , added and changed by Msa Safety Inc.
Msa Safety Inc's Definitive Proxy Statement (Form DEF 14A) filed after their 2018 10-K Annual Report includes:
Material Contracts, Statements, Certifications & more
Msa Safety Inc provided additional information to their SEC Filing as exhibits
Ticker: MSAEvents:
CIK: 66570
Form Type: 8-K Corporate News
Accession Number: 0000066570-18-000045
Submitted to the SEC: Wed Oct 24 2018 5:02:32 PM EST
Accepted by the SEC: Wed Oct 24 2018
Period: Wednesday, October 24, 2018
Industry: Orthopedic Prosthetic And Surgical Appliances And Supplies