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Blount Announces Preliminary Fourth Quarter and Full Year 2015 Results

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  • Fourth quarter 2015 sales of $201 million 
  • Full year 2015 sales were $829 million and Adjusted EBITDA was $101 million 
  • Full year 2015 free cash flow was $33.7 million, net of $3.0 million of transaction-related costs

PORTLAND, Ore., March 02, 2016 (GLOBE NEWSWIRE) -- Blount International, Inc. (NYSE: BLT) ("Blount" or "Company") today announced preliminary results for the fourth quarter and full year ended December 31, 2015. 

Preliminary Results for the Quarter and Full Year Ended December 31, 2015 
Sales in the fourth quarter were $200.7 million, a decrease of $31.5 million or 13.6 percent compared to the fourth quarter of 2014. Operating loss for the fourth quarter of 2015 was $24.4 million compared to $2.5 million in the same quarter last year. Consolidated Adjusted EBITDA for the fourth quarter of 2015 was $21.3 million compared to $30.5 million in the fourth quarter of 2014.

Sales for the full year were $828.6 million, a decrease of 12.3 percent compared to full year 2014. Operating loss for 2015 was $46.8 million compared to operating income of $64.2 million for full year 2014. Adjusted EBITDA for full year 2015 was $100.8 million, a decrease $37.2 million compared to full year 2014.

Blount operates primarily in two business segments - the Forestry, Lawn, and Garden ("FLAG") segment and the Farm, Ranch, and Agriculture ("FRAG") segment. The Company reports separate results for the FLAG and FRAG segments. Blount's Concrete Cutting and Finishing ("CCF") business is included in "Corporate and Other."

Forestry, Lawn, and Garden
The FLAG segment had fourth quarter 2015 sales of $138.2 million, which was $22.2 million, or 13.8 percent, lower than the fourth quarter of 2014, primarily as the result of reduced unit volume and the effects of foreign currency exchange rate changes. Segment sales volumes were unfavorably impacted by pressure from continued U.S. Dollar strength. The change in segment sales for the comparable fourth quarter periods is illustrated below.

Change in FLAG Segment Sales  
(In millions; amounts may not sum due to rounding)Sales Change
 Fourth quarter 2014 $  160.4   
  Increase / (Decrease)   
  Foreign Exchange Translation(8.7) (5.4)%
   151.8  (5.4)%
  Unit Volume(14.1) (8.8)%
  Selling Price / Mix0.6  0.4%
 Fourth quarter 2015 $  138.2  (13.8)%


Segment backlog was $114.5 million at December 31, 2015, a decrease of 18 percent from $140.1 million on December 31, 2014.

Segment Earnings Before Interest, Taxes, Depreciation, Amortization, and certain charges ("Adjusted EBITDA") were $24.1 million for the fourth quarter of 2015, including $7.3 million of allocated shared services expenses. Adjusted EBITDA declined 22.6 percent for the fourth quarter of 2015 versus the fourth quarter of 2014. The change in FLAG contribution to operating income (loss) and Adjusted EBITDA for the comparable fourth quarter periods is presented below.

Change in FLAG Segment Contribution to Operating Income (Loss) and Adjusted EBITDA
(In millions; amounts may not sum due to rounding)
 
 Contribution
to
Operating
Income (Loss)
 As a Percent
of Segment
Sales
 Depreciation,
Amortization,
and
Other
 Adjusted
EBITDA
 As a Percent
of Segment
Sales
Fourth quarter 2014 $  23.9            14.9%  $  7.3   $  31.2            19.4%
Increase / (Decrease)         
Steel Costs1.2         
Foreign Exchange Translation1.7         
 26.7            17.6%      
Unit Volume(5.4)        
Selling Price / Mix0.6         
Costs / Mix(3.8)        
 18.1            13.1%      
  Acquisition accounting(1)0.2         
Fourth quarter 2015 $  18.4            13.3%  $  5.8   $  24.1            17.5%


  (1) Represents change in non-cash acquisition accounting impact for all FLAG business units

Segment contribution to operating income and Adjusted EBITDA declined mostly due to lower sales volumes, as illustrated above, and higher overall operating costs and mix. Operating costs, including mix, were approximately $3.8 million higher, primarily due to higher manufacturing costs on lower production volumes, partially offset by lower SG&A spending in the segment. FLAG factory utilization was 70 percent in the fourth quarter of 2015 compared to 88 percent in the fourth quarter of 2014. Lower SG&A in the segment was mostly related to lower incentive compensation rates resulting from lower than targeted operating results along with lower discretionary spending in the quarter in response to lower sales volumes.

Farm, Ranch, and Agriculture
The FRAG segment reported fourth quarter 2015 sales of $54.4 million, a decrease of $8.9 million, or 14.0 percent, from the fourth quarter of 2014. The reduction in sales was the result of lower volumes of log splitters and agriculture parts and attachments. Log splitter volumes are down compared to the strong fourth quarter of 2014, while the agriculture attachments have been negatively impacted by the continued weak overall agriculture machinery market conditions. The change in segment sales for the comparable fourth quarter periods is illustrated below.

Change in FRAG Segment Sales
(In millions; amounts may not sum due to rounding)Sales Change
 Fourth quarter 2014 $  63.3   
  Increase / (Decrease)   
  Foreign Exchange Translation(0.3) (0.4)%
   63.0  (0.4)%
  Unit Volume(9.3) (14.6)%
  Selling Price / Mix0.7  1.0%
 Fourth quarter 2015 $  54.4  (14.0)%


Segment backlog was $19.5 million at December 31, 2015 compared to $28.8 million at December 31, 2014.

The FRAG segment had $0.7 million of Adjusted EBITDA in the fourth quarter of 2015, including $2.3 million of allocated shared services expenses. The change in FRAG contribution to operating income and Adjusted EBITDA for the comparable fourth quarter periods is presented below.

Change in FRAG Segment Contribution to Operating Income (Loss) and Adjusted EBITDA
 (In millions; amounts may not sum due to rounding)   
    
 Contribution
to
Operating
Income
(Loss)
 As a Percent
of Segment
Sales
 Depreciation,
Amortization,
and
Other
 Adjusted
EBITDA
 As a Percent
of Segment
Sales
Fourth quarter 2014 $  (21.4)          (33.8)%  $
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