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Griffon Corporation Announces Annual and Fourth Quarter Results

NEW YORK--(BUSINESS WIRE)--

Griffon Corporation (“Griffon” or the “Company”) (GFF) today reported results for the fourth quarter and fiscal year ended September 30, 2018.

For the full year 2018, revenue from continuing operations totaled $2.0 billion, increasing 30% from the prior year revenue of $1.5 billion.

For the full year 2018, Income from continuing operations totaled $33.3 million, or $0.78 per share, compared to $17.8 million, or $0.41 per share, in the prior year. Current year results included acquisition costs of $7.6 million ($5.0 million, net of tax, or $0.12 per share), special dividend ESOP charges of $3.2 million ($2.1 million, net tax, or $0.05), secondary equity offering costs of $1.2 million ($0.8 million, net tax, or $0.02), cost of life insurance benefit of $2.6 million ($0.2 million, net tax, or $0.01); and discrete and certain other tax benefits, net, that affect comparability of $9.4 million or $0.22 per share. Prior year results included acquisition costs of $9.6 million ($6.1 million net of tax, or $0.14 per share), Telephonics contract settlement charges of $5.1 million ($3.3 million, net of tax, or $0.08 per share) and discrete and certain other tax benefits, net, that affect comparability of $8.3 million or $0.19 per share. Excluding these items, current year adjusted income from continuing operations was $32.1 million, or $0.76 per share compared to $19.0 million, or $0.44 per share, in the prior year.

For the full year 2018, Segment adjusted EBITDA from continuing operations totaled $213 million, increasing 24% from the prior year of $173 million. Segment adjusted EBITDA is defined as net income excluding interest income and expense, income taxes, depreciation and amortization, unallocated amounts (mainly corporate overhead), restructuring charges, loss on debt extinguishment and acquisition related expenses, as well as other items that may affect comparability, as applicable (“Segment adjusted EBITDA”, a non-GAAP measure).

Fourth quarter revenue from continuing operations of $546 million increased 27% compared to the prior year quarter revenue of $431 million.

Fourth quarter Income from continuing operations totaled $1.0 million, or $0.02 per share, compared to $4.3 million, or $0.10 per share, in the prior year quarter. Current year quarter results included discrete and certain other tax provisions, net, that affect comparability of $14.7 million or $0.35 per share. Prior year quarter results included acquisition costs of $9.6 million ($6.1 million net of tax, or $0.14 per share), Telephonics contract settlement charge of $5.1 million ($3.3 million, net of tax, or $0.08 per share) and discrete and certain other tax benefits, net, that affect comparability of $1.8 million or $0.04 per share. Excluding these items, current year Adjusted income from continuing operations was $15.7 million, or $0.38 per share compared to $12.0 million, or $0.28 per share, in the prior year quarter, a 36% increase.

Fourth quarter Segment adjusted EBITDA from continuing operations totaled $67 million, increasing 26% from the prior year quarter of $54 million.

Ronald J. Kramer, Chairman and Chief Executive Officer, commented “2018 was a transformational year for Griffon. We have significantly grown through the acquisitions of ClosetMaid, Kelkay and CornellCookson, and unlocked value through the divestiture of our Plastics business. These strategic changes position us to continue to increase operating margins and free cash flow, improve our overall financial performance and reduce debt. We are committed to long-term value creation for our shareholders and believe that Griffon has never been in a better strategic position."

Segment Operating Results

Home & Building Products

Revenue in 2018 totaled $1.7 billion, increasing 48% from the prior year. The AMES Companies, Inc. (“AMES”) revenue increased 75%, primarily due to the acquisition of La Hacienda, Tuscan Path, ClosetMaid ("CM"), Harper and Kelkay, and improved North American sales, partially offset by unfavorable weather patterns occurring throughout the year. Clopay Building Products Company, Inc. ("CBP") revenue increased 23% from the prior year period, primarily due to the acquisition of CornellCookson ("CC") and favorable mix, pricing, and increased volume. Organic growth for the year was 7%. CM and CC revenue was $311.6 million and $66.7 million, respectively, for fiscal 2018.

Segment adjusted EBITDA for 2018 was $177 million, increasing 40% compared to the prior year. The increase was primarily due to the benefit from increased revenue, partially offset by increased steel and resin costs, and tariffs.

Revenue in the current quarter totaling $444 million increased 55% from the prior year quarter. AMES revenue increased 72% compared to the prior year quarter, due to the acquisitions of Tuscan Path, CM, Harper and Kelkay, partially offset by decreased revenue at AMES US. CBP revenue increased 41%, due to the acquisition of CC and favorable mix, pricing, and increased volume. Organic growth for the quarter was 4%. CM and CC revenue was $78.0 million and $50.5 million, respectively, in the quarter.

Fourth quarter Segment adjusted EBITDA was $48 million, increasing 41% from the prior year quarter due to the benefit of increased sales, partially offset by increased steel and resin costs, and tariffs.

Defense Electronics

Revenue in 2018 totaled $326 million, decreasing 21% compared to the prior year, as expected, due to decreased maritime surveillance radar and electronic countermeasure systems revenue.

Segment adjusted EBITDA for 2018 was $36 million, compared to $46 million in the prior year primarily due to the decreased revenue noted above and the impact of revised estimates to complete remaining performance obligations on certain airborne intercommunications systems.

Revenue in the current quarter totaled $101 million, decreasing 29% from the prior year quarter, as expected, primarily due to decreased maritime surveillance radar and electronic counter measure systems revenue.

Fourth quarter Segment adjusted EBITDA of $19 million was consistent with the prior year quarter primarily due to improved product mix.

Contract backlog totaled $345 million at September 30, 2018, compared to $351 million at September 30, 2017, with approximately 69% expected to be fulfilled within the next twelve months.

Taxes

The Company reported pretax income from continuing operations for the years ended September 30, 2018 and 2017 and recognized a tax provision of 1.6% compared to a tax benefit of 6.5%, respectively. The 2018 and 2017 tax rates included $9.4 million and $8.3 million, respectively, of net discrete tax benefits and certain other items that affect comparability. Excluding these items, the effective tax rates for the years ended September 30, 2018 and 2017 were 33.8% and 39.7%, respectively.

Balance Sheet and Capital Expenditures

At September 30, 2018, the Company had cash and equivalents of $70 million, total debt outstanding of $1.1 billion, net of discounts and deferred costs, and $310 million available for borrowing under its revolving credit facility. Capital expenditures from continuing operations, net of equipment sales were $49.5 million.

Share Repurchases

In each of August 2016 and August 2018, Griffon’s Board of Directors authorized the repurchase of up to $50 million of Griffon’s outstanding common stock. Under these programs, the Company may purchase shares in the open market, including pursuant to a 10b5-1 plan, or in privately negotiated transactions. During 2018, Griffon purchased an aggregate of 2,088,739 shares of common stock for a total of $41.1 million or $19.68 per share; there were no repurchases during the fourth quarter. At September 30, 2018, $58.3 million remained under existing Board authorizations.

Conference Call Information

The Company will hold a conference call today, November 14, 2018, at 4:30 PM ET.

The call can be accessed by dialing 1-877-407-0792 (U.S. participants) or 1-201-689-8263 (International participants). Callers should ask to be connected to the Griffon Corporation teleconference or provide conference ID number 13684455. Participants are encouraged to dial-in at least 10 minutes before the scheduled start time.

A replay of the call will be available starting on Wednesday, November 14, 2018 at 7:30 PM ET by dialing 1-844-512-2921 (U.S.) or 1-412-317-6671 (International), and entering the conference ID number: 13684455. The replay will be available through Wednesday, November 28, 2018 at 11:59 PM ET.

Forward-looking Statements

“Safe Harbor” Statements under the Private Securities Litigation Reform Act of 1995: All statements related to, among other things, income (loss), earnings, cash flows, revenue, changes in operations, operating improvements, industries in which Griffon operates and the United States and global economies that are not historical are hereby identified as “forward-looking statements” and may be indicated by words or phrases such as “anticipates,” “supports,” “plans,” “projects,” “expects,” “believes,” “should,” “would,” “could,” “hope,” “forecast,” “management is of the opinion,” “may,” “will,” “estimates,” “intends,” “explores,” “opportunities,” the negative of these expressions, use of the future tense and similar words or phrases. Such forward-looking statements are subject to inherent risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statements. These risks and uncertainties include, among others: current economic conditions and uncertainties in the housing, credit and capital markets; Griffon's ability to achieve expected savings from cost control, restructuring, integration and disposal initiatives; the ability to identify and successfully consummate and integrate value-adding acquisition opportunities; increasing competition and pricing pressures in the markets served by Griffon’s operating companies; the ability of Griffon’s operating companies to expand into new geographic and product markets, and to anticipate and meet customer demands for new products and product enhancements and innovations; reduced military spending by the government on projects for which Griffon's Telephonics Corporation supplies products, including as a result of defense budget cuts or other government actions; the ability of the federal government to fund and conduct its operations; increases in the cost or lack of availabiliy of raw materials such as resin, wood and steel, components or purchased finished goods, including the impact from tariffs; changes in customer demand or loss of a material customer at one of Griffon's operating companies; the potential impact of seasonal variations and uncertain weather patterns on certain of Griffon’s businesses; political events that could impact the worldwide economy; a downgrade in Griffon’s credit ratings; changes in international economic conditions including interest rate and currency exchange fluctuations; the reliance by certain of Griffon’s businesses on particular third party suppliers and manufacturers to meet customer demands; the relative mix of products and services offered by Griffon’s businesses, which impacts margins and operating efficiencies; short-term capacity constraints or prolonged excess capacity; unforeseen developments in contingencies, such as litigation, regulatory and environmental matters; unfavorable results of government agency contract audits of Telephonics Corporation; Griffon’s ability to adequately protect and maintain the validity of patent and other intellectual property rights; the cyclical nature of the businesses of certain of Griffon’s operating companies; and possible terrorist threats and actions and their impact on the global economy; Griffon's ability to service and refinance its debt; and the impact of recent and future legislative and regulatory changes, including, without limitation, the Tax Cuts and Jobs Act of 2017. Such statements reflect the views of the Company with respect to future events and are subject to these and other risks, as previously disclosed in the Company’s Securities and Exchange Commission filings. Readers are cautioned not to place undue reliance on these forward-looking statements. These forward-looking statements speak only as of the date made. Griffon undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

About Griffon Corporation

Griffon Corporation is a diversified management and holding company that conducts business through wholly-owned subsidiaries. Griffon oversees the operations of its subsidiaries, allocates resources among them and manages their capital structures. Griffon provides direction and assistance to its subsidiaries in connection with acquisition and growth opportunities as well as divestitures. In order to further diversify, Griffon also seeks out, evaluates and, when appropriate, will acquire additional businesses that offer potentially attractive returns on capital.

Griffon currently conducts its operations through two reportable segments:

  • HBP segment consists of two companies, AMES and CBP:

AMES, founded in 1774, is the leading U.S. manufacturer and a global provider of branded consumer and professional tools, landscaping products, and outdoor lifestyle solutions. In 2018, we acquired ClosetMaid, a leader in wood and wire closet organization, general living storage and wire garage storage products for homeowners and professionals.

CBP, since 1964, is a leading manufacturer and marketer of residential and commercial garage doors and sells to professional dealers and some of the largest home center retail chains in North America. In 2018, we acquired CornellCookson, a leading U.S. manufacturer and marketer of rolling steel door and grille products designed for commercial, industrial, institutional, and retail use.

  • Defense Electronics segment consists of Telephonics Corporation ("Telephonics"), founded in 1933, a globally recognized leading provider of highly sophisticated intelligence, surveillance and communications solutions for defense, aerospace and commercial customers.

For more information on Griffon and its operating subsidiaries, please see the Company’s website at www.griffon.com.

Griffon evaluates performance and allocates resources based on each segment's operating results from continuing operations before interest income and expense, income taxes, depreciation and amortization, unallocated amounts (mainly corporate overhead), restructuring charges, loss on debt extinguishment and acquisition related expenses, as well as other items that may affect comparability, as applicable (“Segment adjusted EBITDA”, a non-GAAP measure). Griffon believes this information is useful to investors.

The following table provides a reconciliation of Segment adjusted EBITDA to Income before taxes from continuing operations:

   
GRIFFON CORPORATION AND SUBSIDIARIES
OPERATING HIGHLIGHTS
(in thousands)
 

(Unaudited)
For the Three Months
Ended September 30,

For the Twelve Months
Ended September 30,

REVENUE   2018   2017 2018   2017
Home & Building Products:
AMES $ 216,276 $ 125,506 $ 953,612 $ 545,269
CBP 227,898   161,564   697,969   568,001  
Home & Building Products 444,174 287,070 1,651,581 1,113,270

Defense Electronics

101,331   143,729   326,337   411,727  
Total revenue $ 545,505   $ 430,799   $ 1,977,918   $ 1,524,997  
 
Home & Building Products $ 48,150 $ 34,260 $ 177,400 $ 126,766

Defense Electronics

19,107   19,253   36,063   45,931  
Total Segment adjusted EBITDA from continuing operations 67,257 53,513 213,463 172,697
Net interest expense (15,389 ) (12,793 ) (63,871 ) (51,449 )
Segment depreciation and amortization (15,356 ) (11,396 ) (55,334 ) (47,398 )
Unallocated amounts (12,819 ) (11,019 ) (45,812 ) (42,398 )
Acquisition costs (9,617 ) (7,597 ) (9,617 )
Special dividend ESOP charges (3,220 )
Secondary equity offering costs (1,205 )
Cost of life insurance benefits (2,614 )
Contract settlement charges   (5,137 )   (5,137 )
Income before taxes from continuing operations $ 23,693   $ 3,551   $ 33,810   $ 16,698  
 

The following is a reconciliation of each segment's operating results to Segment adjusted EBITDA:

   
GRIFFON CORPORATION AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP MEASURES
FROM CONTINUING OPERATIONS
BY REPORTABLE SEGMENT
 
(in thousands)
 

(Unaudited)
For the Three Months Ended
September 30,

For the Twelve Months Ended
September 30,

    2018   2017 2018   2017
Home & Building Products
Segment operating profit $ 35,505 $ 24,834 $ 130,487 $ 89,495
Depreciation and amortization 12,645 8,702 44,533 36,547
Acquisition costs   724   2,380   724  
Segment adjusted EBITDA $ 48,150   $ 34,260   $ 177,400   $ 126,766  
 

Defense Electronics

Segment operating profit $ 16,396 $ 11,422 $ 25,262 $ 29,943
Depreciation and amortization 2,711 2,694 10,801 10,851
Contract settlement charges   5,137     5,137  
Segment adjusted EBITDA $ 19,107   $ 19,253   $ 36,063   $ 45,931  
 
All segments:
Income from continuing operations - as reported $ 39,117 $ 16,803 $ 96,450 $ 69,027
Unallocated amounts 12,819 11,019 45,812 42,398
Other, net (35 ) (459 ) 1,231 (880 )
Corporate acquisition costs 8,893 5,217 8,893
Special dividend ESOP charges 3,220
Secondary equity offering costs 1,205
Cost of life insurance benefit     2,614    
Segment operating profit from continuing operations 51,901 36,256 155,749 119,438
Segment depreciation and amortization 15,356 11,396 55,334 47,398
Acquisition costs 724 2,380 724
Contract settlement charges   5,137     5,137  
Segment adjusted EBITDA from continuing operations $ 67,257   $ 53,513   $ 213,463   $ 172,697  
 

Unallocated amounts typically include general corporate expenses not attributable to any reportable segment.

   
GRIFFON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME
(in thousands, except per share data)
 

(Unaudited)
Three Months Ended
September 30,

 

For the Twelve Months
Ended September 30,

2018   2017   2018   2017
Revenue $ 545,505   $ 430,799 $ 1,977,918 $ 1,524,997
Cost of goods and services 397,054     316,279     1,448,358   1,116,881  
Gross profit 148,451 114,520 529,560 408,116
Selling, general and administrative expenses 109,334     97,717     433,110   339,089  
Income from continuing operations 39,117 16,803 96,450 69,027
Other income (expense)
Interest expense (15,595 ) (12,819 ) (65,568 ) (51,513 )
Interest income 206 26 1,697 64
Other, net (35 )   (459 )   1,231   (880 )
Total other income (expense) (15,424 )   (13,252 )   (62,640 ) (52,329 )
Income before taxes from continuing operations 23,693 3,551 33,810 16,698
Provision (benefit) for income taxes 22,662     (786 )   555   (1,085 )
Income from continuing operations $ 1,031 $ 4,337 $ 33,255 $ 17,783
Discontinued operations:
Income (loss) from operations of discontinued businesses (4,661 ) 637 119,981 22,276
Provision (benefit) for income taxes (2,212 ) 16,924     27,558   25,147  
Income (loss) from discontinued operations (2,449 ) (16,287 )   92,423   (2,871 )
Net income (loss) $ (1,418 ) $ (11,950 )   $ 125,678   $ 14,912  
Income from continuing operations $ 0.03 $ 0.10 $ 0.81 $ 0.43
Income (loss) from discontinued operations (0.06 ) (0.39 ) 2.25 (0.07 )
Basic earnings (loss) per common share $ (0.04 )   $ (0.29 )   $ 3.06   $ 0.36  
Weighted-average shares outstanding 40,326     41,726     41,005   41,005  
Income from continuing operations $ 0.02 $ 0.10 $ 0.78 $ 0.41
Income (loss) from discontinued operations (0.06 ) (0.39 ) 2.18 (0.07 )
Diluted earnings (loss) per common share $ (0.04 )   $ (0.29 )   $ 2.96   $ 0.35  
Weighted-average shares outstanding 40,326     41,726     42,422   43,011  
Net income (loss) $ (1,418 ) $ (11,950 ) $ 125,678 $ 14,912
Other comprehensive income (loss), net of taxes:
Foreign currency translation adjustments 114 9,323 9,403 10,667
Pension and other post retirement plans 6,328 7,571 16,381 9,203
Gain (loss) on cash flow hedge (27 ) 89     585   890  
Total other comprehensive income, net of taxes 6,415     16,983     26,369   20,760  
Comprehensive income $ 4,997     $ 5,033     $ 152,047   $ 35,672  
 
   
GRIFFON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
 

At September 30,
2018

At September 30,
2017

CURRENT ASSETS
Cash and equivalents $ 69,758 $ 47,681
Accounts receivable, net of allowances of $6,408 and $5,966 280,509 208,229
Contract costs and recognized income not yet billed, net of progress payments of $3,172 and $4,407 121,803 131,662
Inventories 398,359 299,437
Prepaid and other current assets 42,121 40,067
Assets of discontinued operations held for sale 370,724
Assets of discontinued operations not held for sale 324   329  
Total Current Assets 912,874 1,098,129
PROPERTY, PLANT AND EQUIPMENT, net 342,492 232,135
GOODWILL 439,395 319,139
INTANGIBLE ASSETS, net 370,858 205,127
OTHER ASSETS 16,355 16,051
ASSETS OF DISCONTINUED OPERATIONS 2,916   2,960  
Total Assets $ 2,084,890   $ 1,873,541  
CURRENT LIABILITIES
Notes payable and current portion of long-term debt $ 13,011 $ 11,078
Accounts payable 233,658 183,951
Accrued liabilities 139,192 83,258
Liabilities of discontinued operations held for sale 84,450
Liabilities of discontinued operations 7,210   8,342  
Total Current Liabilities 393,071 371,079
LONG-TERM DEBT, net 1,108,071 968,080
OTHER LIABILITIES 106,710 132,537
LIABILITIES OF DISCONTINUED OPERATIONS 2,647   3,037  
Total Liabilities 1,610,499 1,474,733
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY
Preferred stock, par value $0.25 per share, authorized 3,000 shares, no shares issued

Common stock, par value $0.25 per share, authorized 85,000 shares,
issued outstanding shares of 81,520 and 80,663, respectively.

20,380 20,166
Capital in excess of par value 503,396 487,077
Retained earnings 550,523 480,347
Treasury shares, at cost, 35,846 common shares and 33,557 common shares (534,830 ) (489,225 )
Accumulated other comprehensive loss (34,112 ) (60,481 )
Deferred compensation (30,966 ) (39,076 )
Total Shareholders’ Equity 474,391   398,808  
Total Liabilities and Shareholders’ Equity $ 2,084,890   $ 1,873,541  
 
 
GRIFFON CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
 
Years Ended September 30,
2018   2017   2016
CASH FLOWS FROM OPERATING ACTIVITIES - CONTINUING OPERATIONS:
Net income $ 125,678 $ 14,912 $ 30,010
Net (income) loss from discontinued operations (92,423 ) 2,871 (10,229 )
Adjustments to reconcile net income to net cash provided by operating activities of continuing operations:
Depreciation and amortization 55,803 47,878 46,342
Stock-based compensation 10,078 8,090 10,136
Provision for losses on accounts receivable 96 271 351
Amortization of deferred financing costs and debt discounts 5,219 4,511 7,321
Deferred income tax (17,633 ) 2,341 6,044
Gain (loss) on sale/disposal of assets and investments 290 (126 ) (319 )
Change in assets and liabilities, net of assets and liabilities acquired:
(Increase) decrease in accounts receivable and contract costs and recognized income not yet billed 2,681 (19,131 ) (35,933 )
(Increase) decrease in inventories (52,122 ) (29,299 ) 16,103
(Increase) decrease in prepaid and other assets 5,969 (4,781 ) 1,462
Increase in accounts payable, accrued liabilities and income taxes payable 11,078 17,541 4,829
Other changes, net 11,732   4,073   4,001  
Net cash provided by operating activities - continuing operations 66,446 49,151 80,118
CASH FLOWS FROM INVESTING ACTIVITIES - CONTINUING OPERATIONS:
Acquisition of property, plant and equipment (50,138 ) (34,937 ) (59,276 )
Acquired business, net of cash acquired (430,932 ) (34,719 ) (4,470 )
Investment sales (purchases) (1,824 ) 715
Proceeds from sale of business 474,727
Proceeds from sale of property, plant and equipment 663   143   770  
Net cash used in investing activities - continuing operations (5,680 ) (71,337 ) (62,261 )
CASH FLOWS FROM FINANCING ACTIVITIES - CONTINUING OPERATIONS:
Dividends paid (49,797 ) (10,325 ) (8,798 )
Purchase of shares for treasury (45,605 ) (15,841 ) (65,307 )
Proceeds from long-term debt 443,058 233,443 302,362
Payments of long-term debt (300,993 ) (170,454 ) (208,514 )
Change in short-term borrowings 144
Share premium payment on settled debt (24,997 )
Financing costs (7,793 ) (1,548 ) (4,384 )
Purchase of ESOP shares (10,908 )
Other, net 51   (70 ) 55  
Net cash provided by (used) in financing activities - continuing operations 39,065 (700 ) 15,414
CASH FLOWS FROM DISCONTINUED OPERATIONS:
Net cash provided by (used in) operating activities (45,624 ) 47,193 24,264
Net cash used in investing activities (10,762 ) (45,075 ) (31,343 )
Net cash provided by (used in) financing activities (22,541 ) (4,268 ) (6,526 )
Net cash provided by (used in) discontinued operations (78,927 ) (2,150 ) (13,605 )
Effect of exchange rate changes on cash and equivalents 1,173   164   886  
NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS 22,077 (24,872 ) 20,552
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD 47,681   72,553   52,001  
CASH AND EQUIVALENTS AT END OF PERIOD $ 69,758   $ 47,681   $ 72,553  
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest $ 59,793 $ 48,137 $ 43,208
Cash paid for taxes 32,140 20,998 3,431
 

Griffon evaluates performance based on Earnings per share and Net income excluding restructuring charges, loss on debt extinguishment, acquisition related expenses, discrete and certain other tax items, as well other items that may affect comparability, as applicable. Griffon believes this information is useful to investors. The following tables provides a reconciliation of Income from continuing operations to Adjusted income from continuing operations and Earnings per common share from continuing operations to Adjusted earnings per common share from continuing operations:

   
GRIFFON CORPORATION AND SUBSIDIARIES
RECONCILIATION OF INCOME FROM CONTINUING OPERATIONS
TO ADJUSTED INCOME FROM CONTINUING OPERATIONS
(in thousands, except per share data)
 

For the Three Months
Ended September 30,

 

For the Twelve Months
Ended September 30,

2018   2017   2018   2017
Income from continuing operations $ 1,031   $ 4,337 $ 33,255 $ 17,783
Adjusting items, net of tax:
Acquisition costs 6,145 5,047 6,145
Contract settlement charges 3,300 3,300
Special dividend ESOP charges 2,125
Secondary equity offering costs 795
Cost of life insurance benefit 248
Discrete and other certain tax provisions (benefits) 14,696     (1,769 )   (9,384 ) (8,274 )
Adjusted income from continuing operations $ 15,727     $ 12,013     $ 32,086   $ 18,954  
 
Earnings per common share from continuing operations $ 0.02 $ 0.10 $ 0.78 $ 0.41
 
Adjusting items, net of tax:
Acquisition costs 0.14 0.12 0.14
Contract settlement charges 0.08 0.08
Special dividend ESOP charges 0.05
Secondary equity offering costs 0.02
Cost of life insurance benefit 0.01
Discrete and other certain tax provisions (benefits) 0.35 (0.04 ) (0.22 ) (0.19 )
Adjusted earnings per share from continuing operations $ 0.38     $ 0.28     $ 0.76   $ 0.44  
Weighted-average shares outstanding (in thousands) 41,797     43,237     42,422   43,011  
 

Note: Due to rounding, the sum of earnings per common share and adjusting items, net of tax, may not equal adjusted earnings per common share.

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