U.S. Markets open in 6 hrs 43 mins

KMG Reports Second Quarter 2018 Financial Results

FORT WORTH, Texas, March 08, 2018 (GLOBE NEWSWIRE) -- KMG (KMG), a global provider of specialty chemicals and performance materials, today announced financial results for the fiscal 2018 second quarter ended January 31, 2018.

2018 Second Quarter Financial Highlights

  • Sales increased 44% from the second quarter of last year to a record $113.9 million.
  • GAAP diluted earnings per share increased 200% to $1.59 from $0.53 per diluted share in the second quarter of fiscal 2017.
  • Adjusted diluted earnings per share1 were a record $1.04 compared to $0.57 per share reported in the second quarter of last year. Among other items, adjusted EPS exclude an $11.0 million benefit from recent U.S. tax reform.
  • GAAP net income increased to a record $25.3 million, compared to $6.5 million in the second quarter of last year.
  • Adjusted EBITDA2 was a record $29.4 million, up 124% from $13.1 million in the second quarter of fiscal 2017.

“KMG’s record second quarter results reflect broad-based growth across our businesses, significant contributions from recent acquisitions and our disciplined focus on execution,” said Chris Fraser, KMG chairman and CEO. “Supported by our continued strong financial performance and reduction in leverage from our recent equity offering, we successfully repriced our outstanding debt during the second quarter, generating substantial interest expense savings.”

Mr. Fraser continued, “Second quarter sales in our electronic chemicals segment increased 6% year-over-year to a record $73.9 million, driven by growth in each of our major geographic regions. Segment operating income and margins also reached record levels in the second quarter, reflecting a favorable product mix and gains in operational efficiency.

“Our performance materials segment generated record sales and operating income in the second quarter, fueled by contributions from Flowchem and Sealweld, as well as growth in our industrial lubricants and wood treating chemicals businesses. Addressing key growth opportunities in the pipeline and energy markets, our pipeline performance business benefited from growing demand for our value-added products and services that enhance pipeline integrity and safety, as well as optimize pipeline throughput and performance. Our wood treating chemicals business also performed well, aided in part by the need to replace storm-damaged utility poles.”

Mr. Fraser concluded, “Considering our solid financial performance in the first half of fiscal 2018, as well as our expectations for continued growth in the second half of the year, we are increasing our fiscal 2018 sales forecast to $445-455 million, from $435-450 million previously, and increasing our fiscal 2018 adjusted EBITDA guidance to $114-118 million, from $110-115 million.”

Consolidated results

       
Second quarter
Dollars in thousands, except EPS
Fiscal 2018   Fiscal 2017
  As Reported Adjusted As Reported Adjusted
  (GAAP) (non-GAAP)3 (GAAP) (non-GAAP)4
Net sales $ 113,851   $ 113,851   $ 79,071   $ 79,071  
Operating income   21,730     25,635     9,040       9,857  
Operating margin   19.1 %   22.5 %     11.4 %     12.5 %
Net income   25,337     16,618      6,486     7,017  
Diluted earnings per share $ 1.59   $ 1.04   $  0.53   $ 0.57  
                         


       
Six months ended January 31
Dollars in thousands, except EPS
Fiscal 2018 YTD   Fiscal 2017 YTD
  As Reported Adjusted As Reported Adjusted
  (GAAP) (non-GAAP)5 (GAAP) (non-GAAP)6
Net sales $ 224,515   $ 224,515   $ 155,566   $ 155,566  
Operating income   41,810     49,126      17,720       18,670  
Operating margin   18.6 %     21.9 %     11.4 %     12.0 %
Net income   31,187     27,746       12,227      12,844  
Diluted earnings per share $   2.18   $   1.94   $   1.00   $  1.05  
                         

Business segment results

           
Electronic Chemicals Second Quarter Second Quarter   First Half First Half
Dollars in thousands Fiscal 2018 Fiscal 2017 Fiscal 2018 Fiscal 2017
  As Reported As Reported As Reported As Reported
  (GAAP) (GAAP) (GAAP) (GAAP)
Net sales $ 73,924   $ 69,766   $ 147,732   $ 136,688  
Operating income     12,730       9,583       23,988       17,644  
Operating margin     17.2 %     13.7 %     16.2 %     12.9 %
                         

For the second fiscal quarter, the Electronic Chemicals segment reported:

  • Sales of $73.9 million, up 6% from the second quarter of fiscal 2017. Sales grew in each geographic region.
  • Operating income of $12.7 million, up 32.8% from $9.6 million in the same period of fiscal 2017. Operating income increased due to higher sales, product mix and operational efficiencies. Operating margin improved to 17.2% compared to 13.7% in the prior-year period.
  • Adjusted EBITDA7 of $15.0 million compared to $12.2 million last year.

Performance Materials
The Performance Materials segment consists of the pipeline performance business and the wood treating chemicals business.

           
Performance Materials Second Quarter Second Quarter   First Half First Half
Dollars in thousands Fiscal 2018 Fiscal 2017 Fiscal 2018 Fiscal 2017
  As Reported As Reported As Reported As Reported
  (GAAP) (GAAP) (GAAP) (GAAP)
Net sales $ 39,927   $ 9,305   $ 76,783   $ 18,878  
Operating income     12,810       3,023       24,394       6,704  
Operating margin     32.1 %     32.5 %     31.8 %     35.5 %
                         

For the second fiscal quarter, the Performance Materials segment reported:

  • Sales of $39.9 million versus $9.3 million in the same period a year ago. Sales growth reflected contributions from Flowchem and Sealweld, as well as product volume growth in both industrial lubricants and wood treating chemicals.
  • Operating income of $12.8 million compared to $3.0 million last year. The increase in operating income reflected contributions from Flowchem and Sealweld, as well as product volume growth in both industrial lubricants and wood treating chemicals. Segment operating margins were 32.1%, compared to 32.5% in the second quarter of 2017, primarily due to higher depreciation and amortization expense related to the acquisitions of Flowchem and Sealweld.   
  • Adjusted EBITDA8 of $17.1 million versus $3.2 million last year.

Fiscal 2018 Outlook

  • Sales: We increase our fiscal 2018 consolidated net sales forecast to $445-455 million, from our prior guidance of $435-450 million.
  • Adjusted EBITDA: We increase our adjusted EBITDA forecast to $114-118 million, from our prior guidance of $110-115 million, reflecting stronger growth expectations in both our electronic chemicals and performance materials segments. Our revised fiscal 2018 adjusted EBITDA forecast includes approximately $8.0 million in stock-based compensation expense, compared to our prior estimate of approximately $6.5 million.
  • Depreciation and Amortization: Depreciation and amortization expense is forecast to be approximately $31 million.
  • Capital Expenditures: Capital expenditures are forecast to be approximately $29 million, in line with our prior estimate, and include a portion of our planned capital investment in Singapore.

With respect to the Company’s full year guidance of Adjusted EBITDA, the Company is not able to provide a reconciliation of these fiscal 2018 non-GAAP financial measures to the most comparable GAAP measure without unreasonable efforts; certain items that are included have not yet occurred and cannot be reasonably predicted, and, accordingly, the probable significance of such items cannot be determined at this time. The most comparable GAAP measure and reconciling information that is unavailable, or not reasonably predictable, would include restructuring and realignment charges and acquisition and integration-related expenses.

Conference call
Date: Thursday March 8, 2018
Time: 5:00 p.m. ET
Dial in: 844-316-8066 or 703-736-7353
Conference ID: 1178959

The conference call will be webcast live via the “Investors” section of the Company’s website at http://kmgchemicals.com.

If you are unable to listen live, the conference call will be archived on the KMG website. A telephone replay of the call will also be available for one week, starting at 8:00 p.m. ET on March 8, 2018. To access the call, dial 855-859-2056 (domestic) or 404-537-3406 (international) using conference ID 1178959.

About KMG
KMG Chemicals, Inc., through its subsidiaries, produces and distributes specialty chemicals and performance materials for the semiconductor, industrial wood preservation and pipeline and energy markets. For more information, visit the Company's website at http://kmgchemicals.com.

The information in this news release includes certain forward-looking statements that are based upon assumptions that in the future may prove not to have been accurate and are subject to significant risks and uncertainties, including statements as to the future performance of the company. Although the company believes that the expectations reflected in its forward-looking statements are reasonable, it can give no assurance that such expectations or any of its forward-looking statements will prove to be correct. Factors that could cause results to differ include, but are not limited to, successful performance of internal plans, product development acceptance, the impact of competitive services and pricing and general economic risks and uncertainties.

1 Non-U.S. GAAP measure. See Table 2 for reconciliation.    

2 Non-U.S. GAAP measure. See Tables 1 and 1A for reconciliation.

3 Non-U.S. GAAP measure. See Tables 2 and 2A for reconciliation.

4 Non-U.S. GAAP measure. See Tables 2 and 2A for reconciliation.

5 Non-U.S. GAAP measure. See Tables 2 and 2A for reconciliation.

6 Non-U.S. GAAP measure. See Tables 2 and 2A for reconciliation.

7 Non-U.S. GAAP measure. See Tables 1 and 1A for reconciliation.

8 Non-U.S. GAAP measure. See Tables 1 and 1A for reconciliation.

       
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(In thousands, except per share amounts)
       
  Three Months Ended   Six Months Ended
  January 31,   January 31,
    2018       2017       2018       2017  
Net sales   $ 113,851     $ 79,071     $ 224,515     $   155,566  
Cost of sales   64,597       47,869       128,780       94,681  
Gross profit     49,254       31,202       95,735       60,885  
               
Distribution expenses   8,680       9,770       18,122       18,872  
Selling, general and administrative expenses   14,999       11,867       28,338       23,233  
Amortization of intangible assets   3,885       525       7,396       1,060  
Restructuring charges   (40 )           69        
Operating income     21,730       9,040       41,810       17,720  
Other (expense) income              
Interest expense, net     (5,086 )       (172 )     (13,180 )     (349 )
Loss on the extinguishment of debt     (1,916 )           (6,091 )      
Derivative fair value gain     3,024             3,873        
Other, net     (596 )       (285 )     (777 )       (55 )
Total other (expense) income, net     (4,574 )     (457 )     (16,175 )     (404 )
               
Income before income taxes   17,156       8,583       25,635       17,316  
Provision for income taxes     8,181       (2,097 )     5,552       (5,089 )
Net income $ 25,337     $ 6,486     $ 31,187     $ 12,227  
Earnings per share:              
Net income per common share basic   $ 1.64     $ 0.55     $ 2.24     $ 1.03  
Net income per common share diluted   $ 1.59     $ 0.53     $ 2.18     $ 1.00  
               
Weighted average shares outstanding:              
Basic     15,495       11,882       13,923       11,881  
Diluted     15,903       12,293       14,285       12,203  
                                 


     
KMG CHEMICALS, INC. AND SUBSIDIARIES
 CONSOLIDATED BALANCE SHEETS
 (In thousands, except for share and per share amounts)
     
    January 31,     July 31,  
    2018     2017  
  (Unaudited)  
Assets    
Current assets    
Cash and cash equivalents $   21,966   $   20,708  
Accounts receivable    
Trade, net of allowances of $237 at January 31, 2018 and $263 at July 31, 2017   54,339      

51,168
 
Other   4,721     6,168  
Inventories, net   49,534     46,482  
Prepaid expenses and other   7,751     8,617  
Total current assets   138,311     133,143  
     
Property, plant and equipment, net   108,954     105,435  
Goodwill   230,214     224,391  
Intangible assets, net   307,528     320,401  
Other assets, net   11,176     9,061  
Total assets $ 796,183   $ 792,431  
     
Liabilities & stockholders’ equity    
Current liabilities    
Accounts payable $   32,496   $   29,570  
Accrued liabilities   10,686     12,456  
Employee incentive accrual   3,679     7,713  
Current portion of long-term debt       3,167  
Total current liabilities   46,861     52,906  
     
Long-term debt   337,048     523,102  
Deferred tax liabilities   22,852     37,944  
Other long-term liabilities   5,350     4,763  
Total liabilities   412,111     618,715  
     
Commitments and contingencies    
     
Stockholders’ equity    
Preferred stock, $.01 par value, 10,000,000 shares authorized, none issued        
Common stock, $.01 par value, 40,000,000 shares authorized, 15,503,290 shares issued and outstanding at January 31, 2018 and 11,889,649 shares issued and outstanding at July 31, 2017    

 

155
     

 

119
 
Additional paid-in capital   218,001     42,535  
Accumulated other comprehensive loss   (5,222 )   (9,712 )
Retained earnings   171,138     140,774  
Total stockholders’ equity   384,072     173,716  
Total liabilities and stockholders’ equity $   796,183   $   792,431  
             


       
KMG CHEMICALS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)
       
    Six Months Ended  
    January, 31  
    2018     2017  
Cash flows from operating activities                
Net income   $ 31,187     $ 12,227  
Adjustments to reconcile net income to net cash provided by
operating activities
               
Depreciation and amortization     14,695       7,048  
Loss on extinguishment of debt     6,091        
Stock-based compensation expense     3,593       3,087  
Amortization of debt discounts and financing costs
included in interest expense
    828        
Debt repricing transaction costs     602        
Deferred income tax expense     (11,780 )     (821 )
Derivative fair value gain     (3,873 )      
Other     (77 )     53  
Changes in operating assets and liabilities                
Accounts receivable — trade     (2,041 )     (2,585 )
Accounts receivable — other     1,554       1,846  
Inventories     (2,272 )     1,002  
Other current and noncurrent assets     442       (302 )
Accounts payable     2,579       951  
Accrued liabilities and other     (5,293 )     (3,083 )
Net cash provided by operating activities     36,235       19,423  
                 
Cash flows from investing activities                
Additions to property, plant and equipment     (9,030 )     (5,310 )
Other investing activities     (1,262 )        
Proceeds − insurance claim           250  
Net cash used in investing activities     (10,292 )     (5,060 )
                 
Cash flows from financing activities                
Proceeds from sale of common stock, net of issuance costs     175,669        
Borrowings under credit facility           17,000  
Payments under credit facility           (11,800 )
Principal payments on borrowings on term loan     (196,000 )      
Debt repricing transaction costs     (602 )      
Payment of dividends     (822 )     (709 )
Cash payments related to tax withholdings from stock-based awards     (3,729 )     (277 )
Net cash provided by (used in) financing activities     (25,484 )     4,214  
                 
Effect of exchange rate changes on cash     799       (418 )
                 
Net increase in cash, cash equivalents and restricted cash     1,258       18,159  
Cash, cash equivalents and restricted cash at beginning of period     20,708       13,428  
Cash, cash equivalents and restricted cash at end of period   $ 21,966     $ 31,587  
                 

Reconciliation of GAAP financial measures to non-GAAP financial measures
KMG provides non-GAAP financial information to complement reported GAAP results. KMG believes that analysis of our financial performance would be enhanced by an understanding of the factors underlying that performance and our judgments about the likelihood that particular factors will repeat. We define adjusted EBITDA as earnings from operations before interest, taxes, depreciation, amortization, acquisition and integration expenses, restructuring and realignment charges and other relevant items.

KMG intends to continue to provide certain non-GAAP financial information and the appropriate reconciliation to GAAP in its financial results. As required by SEC rules, the tables below present a reconciliation of our presented non-GAAP measures to the most directly comparable GAAP measures. These non-GAAP measures should be viewed as a supplement to, and not a substitute for, U.S. GAAP measures of performance.

Table 1
RECONCILIATION OF CONSOLIDATED GAAP NET INCOME TO CONSOLIDATED ADJUSTED EBITDA

     
 

(in thousands)
Second Quarter
Fiscal 2018
Second Quarter
Fiscal 2017
Consolidated GAAP net income $ 25,337   $   6,486
Add back:    
Interest expense, net   5,086     172
Income taxes    (8,181 )   2,097
Depreciation & amortization   7,586     3,496
Loss on the extinguishment of debt   1,916    
Derivative fair value gain   (3,024 )  
Debt repricing transaction costs   602    
Acquisition & integration expenses   119     501
Corporate relocation expense       316
Restructuring charges, excluding accelerated depreciation   (40 )
Consolidated adjusted EBITDA $ 29,401   $ 13,068
 


     
 

(in thousands)
Six Months Ended
Jan. 31, 2018
Six Months Ended
Jan. 31, 2017
Consolidated GAAP net income $ 31,187   $ 12,227
Add back:    
Interest expense, net   13,180     349
Income taxes   (5,552 )   5,089
Depreciation & amortization   14,695     7,048
Loss on the extinguishment of debt   6,091    
Derivative fair value gain   (3,873 )  
Debt repricing transaction costs   602    
Acquisition & integration expenses   530     584
Corporate relocation expense       366
Restructuring charges, excluding accelerated depreciation   69  
Consolidated adjusted EBITDA $ 56,929   $ 25,663
 

Table 1A
RECONCILIATION OF OPERATING INCOME TO ADJUSTED EBITDA
Note that we do not allocate certain financial statement line items below operating income to our segments; as such, the reconciliations below only reflect the reconciliation of our operating income by segment to our non-GAAP measures.

         
Second Quarter Fiscal 2018 Electronic
  Performance
     
(in thousands) Chemicals
  Materials
  Corporate
  Total
 
Operating Income (Loss) $ 12,730   $ 12,810   $ (3,810 ) $ 21,730  
Other income (expense)   (434 )   (23 )   (139 )   (596 )
Depreciation and amortization   2,760     4,287     539     7,586  
Acquisition & integration expenses       36     83     119  
Debt repricing costs           602     602  
Restructuring charges   (40 )           (40 )
Adjusted EBITDA   15,016     17,110     (2,725 )   29,401  
Corporate allocation   3,150     1,982     (5,132 )    
Adjusted EBITDA excl. corporate allocation $ 18,166   $ 19,092   $ (7,857 ) $ 29,401  
         


         
Six Months Ended January 31, 2018 Electronic
  Performance
 
 
(in thousands) Chemicals
  Materials
Corporate
  Total
 
Operating Income (Loss) $ 23,988   $ 24,394 $ (6,572 ) $ 41,810  
Other income (expense)   (583 )   55   (249 )   (777 )
Depreciation and amortization   5,554     8,168   973     14,695  
Acquisition & integration expenses       97   433     530  
Debt repricing transaction costs         602     602  
Restructuring charges   69           69  
Adjusted EBITDA   29,028     32,714   (4,813 )   56,929  
Corporate allocation   6,069     3,929   (9,998 )    
Adjusted EBITDA excl. corporate allocation $ 35,097   $ 36,643 $ (14,811 ) $ 56,929  
 


             
Second Quarter Fiscal 2017 Electronic
  Performance
     
(in thousands) Chemicals
  Materials
  Corporate
  Total
 
Operating Income (Loss) $ 9,583   $ 3,023   $ (3,566 ) $ 9,040  
Other income (expense)   (148 )   (75 )   (62 )   (285 )
Depreciation and amortization   2,793     285     418     3,496  
Acquisition & integration expenses           501     501  
Corporate relocation expense           316     316  
Adjusted EBITDA   12,228     3,233     (2,393 )   13,068  
Corporate allocation   3,329     842     (4,171 )    
Adjusted EBITDA excl. corporate allocation $ 15,557   $ 4,075   $ (6,564 ) $ 13,068  
         


           
Six Months Ended January 31, 2017 Electronic Performance
     
(in thousands) Chemicals Materials
  Corporate
  Total
 
Operating Income (Loss) $ 17,644 $ 6,704   $ (6,628 ) $ 17,720  
Other income (expense)   163   (99 )   (119 )   (55 )
Depreciation and amortization   5,645   572     831     7,048  
Acquisition & integration expenses         584     584  
Corporate relocation expense         366     366  
Adjusted EBITDA   23,452   7,177     (4,966 )   25,663  
Corporate allocation   6,658   1,684     (8,342 )    
Adjusted EBITDA excl. corporate allocation $ 30,110 $ 8,861   $ (13,308 ) $ 25,663  
                       

Table 2
RECONCILIATION OF NET INCOME TO ADJUSTED NET INCOME AND ADJUSTED DILUTED EARNINGS PER SHARE
(in thousands)

   
  Three Months Ended
  January 31,
    2018       2017  
Net income $ 25,337     $ 6,486  
Items impacting pre-tax income:                  
Impact of the Tax Cuts and Jobs Act   (11,005 )      
Acquisition & integration expenses   119       501  
Corporate relocation expense         316  
Restructuring charges   (40 )      
Derivative fair value gain   (3,024 )      
Amortization of Flowchem intangible assets   3,224        
Loss on the extinguishment of debt   1,916        
Debt repricing transaction costs   602        
Amortization of debt discounts and financing costs   335        
Income taxes*   (846 )     (286 )
Adjusted net income $ 16,618     $ 7,017  
Adjusted diluted earnings per share $   1.04     $ 0.57  
Weighted average diluted shares outstanding     15,903       12,293  
               
* For the three months ended January 31, 2018, represents the aggregate tax-effect assuming a 27% tax rate of the items impacting pre-tax income, which is our estimated U.S. statutory federal tax rate for fiscal year 2018 following the enactment of the Tax Cuts and Jobs Act in December 2017. For the three months ended January 31, 2017, represents the aggregate tax-effect assuming a 35% tax rate of items impacting pre-tax income.
     
  Six Months Ended  
  January 31,  
    2018       2017  
Net income $ 31,187     $ 12,227  
Items impacting pre-tax income:              
Impact of the Tax Cuts and Jobs Act   (11,005 )    
 
Acquisition & integration expenses   530         584  
Corporate relocation expense           366  
Restructuring charges   69          
 
Derivative fair value gain   (3,873 )    
 
Amortization of Flowchem intangible assets   6,115      
 
Loss on the extinguishment of debt   6,091      
 
Debt repricing transaction costs   602      
 
Amortization of debt discounts and financing costs   828      
 
Income taxes*   (2,798 )       (332
Adjusted net income** $ 27,746     $ 12,845  
Adjusted diluted earnings per share ** $ 1.94     $  1.05  
Weighted average diluted shares outstanding   14,285       12,203  
 * For the six months ended January 31, 2018, represents the aggregate tax-effect assuming a 27% tax rate of the items impacting pre-tax income, which is the estimated blended statutory tax rate for fiscal year 2018. For the six months ended January 31, 2017, represents the aggregate tax-effect assuming a 35% tax rate of items impacting pre-tax income.
** Adjusted net income and adjusted diluted earnings per share for the first quarter of fiscal 2018, which are included in the six months ended January 31, 2018, have been adjusted to reflect the assumed 27% tax rate for fiscal year 2018.
 
   

Table 2A
RECONCILIATION OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL MEASURES

   
Second Quarter Fiscal 2018 KMG Chemicals, Inc.
Dollars in thousands, except EPS  
    Operating   Net   Diluted Earnings
Income   Margin   Income   Per Share
GAAP measure $ 21,730     19.1 %   $ 25,337     $ 1.59  
Amortization of Flowchem intangible assets   3,224     2.8 %     2,354       0.15  
Debt repricing transaction costs   602     0.5 %     439       0.03  
Acquisition & integration expenses   119     0.1 %     87       0.01  
Restructuring charges   (40 )   (0.0 %)     (30 )     (0.01 )
Impact of the Tax Cuts and Jobs Act             (11,005 )     (0.69 )
Derivative fair value gain             (2,208 )     (0.14 )
Loss on the extinguishment of debt             1,399       0.09  
Amortization of debt discounts and financing costs             245       0.01  
Non-GAAP measure $ 25,635     22.5 %   $ 16,618     $ 1.04  
                             


   
Six Months Ended January 31, 2018 KMG Chemicals, Inc.
Dollars in thousands, except EPS  
    Operating   Net   Diluted Earnings
Income   Margin   Income   Per Share
GAAP measure $ 41,810   18.6 %   $ 31,187     $ 2.18  
Amortization of Flowchem intangible assets   6,115   2.7 %     4,464       0.31  
Debt repricing transaction costs   602   0.3 %     439       0.03  
Acquisition & integration expenses   530   0.2 %     387       0.03  
Restructuring charges   69   0.1 %     51       0.01  
Impact of the Tax Cuts and Jobs Act           (11,005 )     (0.77 )
Loss on the extinguishment of debt           4,446       0.31  
Derivative fair value gain           (2,827 )     (0.20 )
Amortization of debt discounts and financing costs           604       0.04  
Non-GAAP measure $ 49,126   21.9 %   $ 27,746     $ 1.94  
                           


   
Second Quarter Fiscal 2017 KMG Chemicals, Inc.
Dollars in thousands, except EPS  
    Operating   Net   Diluted Earnings
Income   Margin   Income   Per Share
GAAP measure $  9,040   11.5 %   $ 6,486   $ 0.53
Acquisition & integration expenses     501     0.6 %     326       0.02
Corporate relocation expense     316     0.4 %     205       0.02
Non-GAAP measure $   9,857   12.5 %   $ 7,017   $ 0.57
                       


   
Six Months Ended January 31, 2017 KMG Chemicals, Inc.
Dollars in thousands, except EPS  
    Operating   Net   Diluted Earnings
Income   Margin   Income   Per Share
GAAP measure $  17,720   11.4 %   $ 12,227   $ 1.00
Acquisition & integration expenses   584   0.4 %     380     0.03
Corporate relocation expense   366   0.2 %     238     0.02
Non-GAAP measure $   18,670   12.0 %   $ 12,845   $ 1.05