DALLAS, April 24, 2017 /PRNewswire/ -- Lennox
International Inc. (NYSE: LII) today reported financial results for
the first quarter of 2017. All comparisons are to the prior-year
period.
For the first quarter, revenue was a first-quarter record
$793 million, up 11%. Foreign
exchange was neutral to revenue. GAAP operating income was up 39%
to a first-quarter record $61
million. GAAP earnings per share from continuing operations
was up 79% to a first-quarter record $1.00, including a $0.17 benefit from recent GAAP accounting
requirements regarding excess tax benefits from share-based
compensation against $0.07 in charges
for special items. On an adjusted basis, total segment profit
increased 39% to a first-quarter record $65
million, and margin expanded 170 basis points to a
first-quarter record 8.2%. Adjusted EPS from continuing operations
rose 50% to a first-quarter record $0.90.
"Lennox International posted strong revenue growth and margin
expansion in a record first quarter, despite some headwind from
weather," said Chairman and CEO Todd
Bluedorn. "The company hit new first-quarter highs for
revenue, total segment profit and margin, as well as earnings per
share. Growth in the quarter included the benefit of five more
days, or 6% more days, this year than in the first quarter last
year. This balances out on a full-year basis with the fourth
quarter having 6% fewer days than a year ago.
"In our Residential business, revenue was up 11% to a new
first-quarter high. Segment margin was relatively flat in our
seasonally smallest quarter on investments in distribution
expansion, information technology, research and development, and
other SG&A investments. With warmer weather than last year,
Residential mix was not as favorable as expected due to faster
growth in new construction than replacement business. We continue
to expect strong margin expansion for 2017 overall as we head into
our seasonally largest quarters.
"In Commercial, revenue, margin and profit all set new
first-quarter records. Commercial revenue was up 15%, led by more
than 20% growth in North America
equipment. Commercial profit rose 35% as segment margin expanded
150 basis points to 9.8%. In Refrigeration, revenue was up 6%, and
profit rose 57% as segment margin expanded 250 basis points to
7.9%.
"Looking ahead for the company overall, we are reiterating
guidance for revenue and adjusted EPS from continuing operations
for 2017. While early, the company is off to a strong start, and we
continue to expect another record year as we enter our largest
seasonal period. We remain focused on capitalizing on end market
growth, capturing additional market share with our strategic
initiatives, and driving higher profitability."
FINANCIAL HIGHLIGHTS
Revenue: Revenue for the first quarter was $793 million, up 11% from the prior-year quarter.
Foreign exchange was neutral to revenue. Volume and price/mix were
up on a revenue basis from the prior-year quarter.
Gross Profit: Gross profit in the first quarter was
$211 million, up 15%. Gross margin
was 26.6%, up 90 basis points. Gross profit was positively impacted
by higher volume and lower material costs, with a partial offset
from investments in distribution expansion.
Income from Continuing Operations: On a GAAP basis,
income from continuing operations for the first quarter was
$43.5 million, or $1.00 per share, compared to $24.9 million, or $0.56 per share, in the prior-year quarter.
Adjusted income from continuing operations in the first quarter
was $38.9 million, or $0.90 per share, compared to $27.0 million, or $0.60 per share, in the prior-year quarter.
Adjusted earnings from continuing operations for the first quarter
of 2017 excludes a benefit of $4.6
million, net of special after-tax charges: a $7.4 million benefit for excess tax benefits from
share-based compensation, a charge of $1.1
million for asbestos-related litigation, $0.9 million for special legal contingency
charges, and $0.8 million in charges
for other items.
Free Cash Flow and Total Debt: Net cash from operations
in the first quarter was ($108)
million compared to ($102)
million in the prior-year quarter. Capital expenditures were
$25 million in the first quarter
compared to $24 million in the first
quarter a year ago. Free cash flow was approximately ($133) million compared to ($126) million in the prior-year quarter. Total
debt at the end of the first quarter was $1,103 million. Total cash and cash equivalents
were $49 million at the end of the
quarter. The company paid $19 million
in dividends and $75 million for
stock repurchases in the first quarter.
BUSINESS SEGMENT HIGHLIGHTS
Residential Heating & Cooling
Revenue in the Residential Heating & Cooling business segment
was a first-quarter record $420
million, up 11%. Foreign exchange was neutral on a revenue
basis. Segment profit was a first-quarter record $43 million, up 11%. Segment profit margin was
10.1% compared to 10.2% in the prior-year quarter. Results were
impacted by higher volume, lower material costs, and favorable
foreign exchange, with offsets from investments
in distribution expansion, information technology, research
and development, and other SG&A investments.
Commercial Heating & Cooling
Revenue in the Commercial Heating & Cooling business segment
was a first-quarter record $196
million, up 15%. Foreign exchange was neutral on a revenue
basis. Segment profit was a first-quarter record $19 million, up 35%. Segment profit margin was a
first-quarter record 9.8%, up 150 basis points. Results were
impacted by higher volume and lower material costs, with a partial
offset from SG&A investments.
Refrigeration
Revenue in the Refrigeration business segment was $178 million, up 6%. At constant currency,
revenue was up 5%. Segment profit was $14
million, up 57%. Segment profit margin was 7.9%, up 250
basis points. Results were impacted by higher volume, lower
material costs, and favorable mix, with a partial offset from
SG&A investments.
FULL-YEAR OUTLOOK
For 2017, the company is raising guidance for GAAP EPS from
continuing operations and reiterating all other guidance
points.
- Reiterating 2017 guidance for revenue growth of 3-7%, with a
minimal impact from foreign exchange.
- Raising 2017 guidance for GAAP EPS from continuing operations
from $7.55-$8.15 to $7.65-$8.25, incorporating the $0.17 first-quarter benefit from recent GAAP
accounting requirements regarding excess tax benefits from
share-based compensation against $0.07 in charges for special items.
- Reiterating 2017 guidance for adjusted EPS from continuing
operations of $7.55-$8.15.
- Reiterating 2017 corporate expenses of approximately
$85 million.
- Reiterating an effective tax rate of approximately 32% on an
adjusted basis for the full year.
- Reiterating 2017 capital expenditures of approximately
$100 million.
- Reiterating guidance for a weighted average diluted share count
of 42-43 million shares on a full-year basis, including plans for
$250 million of stock repurchases for
2017 in total.
CONFERENCE CALL INFORMATION
A conference call to discuss the company's first quarter results
will be held this morning at 8:30 a.m.
Central time. To listen, call the conference call line at
612-332-0107 at least 10 minutes prior to the scheduled start time
and use reservation number 421542. The conference call also will be
webcast on Lennox International's web site at
www.lennoxinternational.com. A replay will be available from
11:00 a.m. Central time on
April 24 through May 8, 2017 by
dialing 800-475-6701 (U.S.) or 320-365-3844 (international) and
using access code 421542. The call also will be archived on the
company's website.
About Lennox International
Lennox International Inc. is a global leader in the heating, air
conditioning, and refrigeration markets. Lennox International is
listed on the New York Stock Exchange and traded under the symbol
"LII". Additional information is available at:
www.lennoxinternational.com or by contacting Steve Harrison, Vice President, Investor
Relations, at 972-497-6670.
Forward-Looking Statements
The statements in this news release that are not historical
statements, including statements regarding the 2017 full-year
outlook and expected financial results for 2017, are
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements are based on information currently available as well as
management's assumptions and beliefs today. These statements are
subject to numerous risks and uncertainties that could cause actual
results to differ materially from the results expressed or implied
by the statements, and investors should not place undue reliance on
them. Risks and uncertainties that could cause actual results
to differ materially from such statements include, but are not
limited to: the impact of higher raw material prices, LII's ability
to implement price increases for its products and services,
economic conditions in our markets, regulatory changes, the impact
of unfavorable weather, and a decline in new construction activity
and related demand for products and services. For information
concerning these and other risks and uncertainties, see LII's
publicly available filings with the Securities and Exchange
Commission. LII disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
LENNOX
INTERNATIONAL INC. AND SUBSIDIARIES
Consolidated
Statements of Operations
(Unaudited)
|
|
(Amounts in
millions, except per share data)
|
For the Three
Months Ended March 31,
|
|
2017
|
|
2016
|
Net
sales
|
$
|
793.4
|
|
|
$
|
715.2
|
|
Cost of goods
sold
|
582.5
|
|
|
531.6
|
|
Gross
profit
|
210.9
|
|
|
183.6
|
|
Operating
Expenses:
|
|
|
|
Selling, general and
administrative expenses
|
152.4
|
|
|
140.4
|
|
Losses and other
expenses, net
|
3.1
|
|
|
4.3
|
|
Restructuring charges
(gains)
|
0.1
|
|
|
(0.2)
|
|
Income from equity
method investments
|
(5.5)
|
|
|
(4.6)
|
|
Operating
income
|
60.8
|
|
|
43.7
|
|
Interest expense,
net
|
7.4
|
|
|
5.8
|
|
Income from
continuing operations before income taxes
|
53.4
|
|
|
37.9
|
|
Provision for income
taxes
|
9.9
|
|
|
13.0
|
|
Income from
continuing operations
|
43.5
|
|
|
24.9
|
|
Discontinued
Operations:
|
|
|
|
Loss from
discontinued operations before income taxes
|
—
|
|
|
—
|
|
Benefit from income
taxes
|
—
|
|
|
—
|
|
Loss from
discontinued operations
|
—
|
|
|
—
|
|
Net
income
|
$
|
43.5
|
|
|
$
|
24.9
|
|
|
|
|
|
Earnings per
share – Basic:
|
|
|
|
Income from
continuing operations
|
$
|
1.02
|
|
|
$
|
0.57
|
|
Loss from
discontinued operations
|
—
|
|
|
—
|
|
Net income
|
$
|
1.02
|
|
|
$
|
0.57
|
|
Earnings per
share – Diluted:
|
|
|
|
Income from
continuing operations
|
$
|
1.00
|
|
|
$
|
0.56
|
|
Loss from
discontinued operations
|
—
|
|
|
—
|
|
Net income
|
$
|
1.00
|
|
|
$
|
0.56
|
|
|
|
|
|
Weighted Average
Number of Shares Outstanding - Basic
|
42.8
|
|
|
44.0
|
|
Weighted Average
Number of Shares Outstanding - Diluted
|
43.5
|
|
|
44.7
|
|
|
|
|
|
Cash dividends
declared per share
|
$
|
0.43
|
|
|
$
|
0.36
|
|
LENNOX
INTERNATIONAL INC. AND SUBSIDIARIES
|
Segment Net Sales
and Profit (Loss)
|
(Unaudited)
|
|
(Amounts in
millions)
|
For the Three
Months Ended March 31,
|
|
2017
|
|
2016
|
Net
sales
|
|
|
|
Residential
Heating & Cooling
|
$
|
419.8
|
|
|
$
|
377.3
|
|
Commercial
Heating & Cooling
|
195.5
|
|
|
170.3
|
|
Refrigeration
|
178.1
|
|
|
167.6
|
|
|
$
|
793.4
|
|
|
$
|
715.2
|
|
|
|
|
|
Segment Profit
(Loss) (1)
|
|
|
|
Residential
Heating & Cooling
|
$
|
42.5
|
|
|
$
|
38.3
|
|
Commercial
Heating & Cooling
|
19.1
|
|
|
14.2
|
|
Refrigeration
|
14.1
|
|
|
9.0
|
|
Corporate and
other
|
(11.0)
|
|
|
(14.8)
|
|
Total segment
profit
|
64.7
|
|
|
46.7
|
|
Reconciliation to
Operating income:
|
|
|
|
Special product
quality adjustments
|
—
|
|
|
(0.4)
|
|
Items in Losses and
other expenses, net that are excluded from segment
profit (loss) (1)
|
3.8
|
|
|
3.6
|
|
Restructuring charges
(gains)
|
0.1
|
|
|
(0.2)
|
|
Operating
income
|
$
|
60.8
|
|
|
$
|
43.7
|
|
|
|
|
(1)
|
The Company defines
segment profit and loss as a segment's operating income included in
the accompanying Consolidated Statements of Operations,
excluding:
|
|
• Special
product quality adjustments;
|
|
• The following
items in Losses (gains) and other expenses, net:
|
|
|
• Net change in
unrealized losses (gains) on unsettled futures
contracts,
|
|
|
• Special legal
contingency charges,
|
|
|
• Asbestos-related
litigation,
|
|
|
• Contractor tax
payments,
|
|
|
• Environmental
liabilities,
|
|
|
• Acquisition
costs,
|
|
|
• Other items, net;
and,
|
|
• Restructuring
charges (gains).
|
LENNOX
INTERNATIONAL INC. AND SUBSIDIARIES
Consolidated
Balance Sheets
|
|
(Amounts in
millions, except shares and par values)
|
As of March
31,
2017
|
|
As of December
31,
2016
|
|
(unaudited)
|
|
|
ASSETS
|
|
|
|
Current
Assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
48.8
|
|
|
$
|
50.2
|
|
Accounts and notes
receivable, net of allowances of $6.0 and $6.7 in 2017 and 2016,
respectively
|
513.4
|
|
|
469.8
|
|
Inventories,
net
|
522.8
|
|
|
418.5
|
|
Other
assets
|
101.4
|
|
|
67.4
|
|
Total current
assets
|
1,186.4
|
|
|
1,005.9
|
|
Property, plant and
equipment, net of accumulated depreciation of $734.1 and $717.2 in
2017 and 2016, respectively
|
365.6
|
|
|
361.4
|
|
Goodwill
|
197.6
|
|
|
195.1
|
|
Deferred income
taxes
|
134.0
|
|
|
136.7
|
|
Other assets,
net
|
67.0
|
|
|
61.2
|
|
Total
assets
|
$
|
1,950.6
|
|
|
$
|
1,760.3
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
Liabilities:
|
|
|
|
Short-term
debt
|
$
|
201.6
|
|
|
$
|
52.4
|
|
Current maturities of
long-term debt
|
207.6
|
|
|
200.1
|
|
Accounts
payable
|
401.0
|
|
|
361.2
|
|
Accrued
expenses
|
224.8
|
|
|
265.9
|
|
Income taxes
payable
|
2.5
|
|
|
9.0
|
|
Total current
liabilities
|
1,037.5
|
|
|
888.6
|
|
Long-term
debt
|
693.9
|
|
|
615.7
|
|
Post-retirement
benefits, other than pensions
|
2.4
|
|
|
2.8
|
|
Pensions
|
88.3
|
|
|
87.5
|
|
Other
liabilities
|
129.5
|
|
|
127.7
|
|
Total
liabilities
|
1,951.6
|
|
|
1,722.3
|
|
Commitments and
contingencies
|
|
|
|
Stockholders'
equity:
|
|
|
|
Preferred stock, $.01
par value, 25,000,000 shares authorized, no shares issued or
outstanding
|
—
|
|
|
—
|
|
Common stock, $.01
par value, 200,000,000 shares authorized, 87,170,197 shares
issued
|
0.9
|
|
|
0.9
|
|
Additional paid-in
capital
|
1,034.1
|
|
|
1,046.2
|
|
Retained
earnings
|
1,378.1
|
|
|
1,353.0
|
|
Accumulated other
comprehensive loss
|
(176.5)
|
|
|
(195.1)
|
|
Treasury stock, at
cost, 44,436,331 shares and 44,195,250 shares as of March 31,2017
and December 31,2016, respectively
|
(2,238.0)
|
|
|
(2,167.4)
|
|
Noncontrolling
interests
|
0.4
|
|
|
0.4
|
|
Total
stockholders' equity
|
(1.0)
|
|
|
38.0
|
|
Total liabilities
and stockholders' equity
|
$
|
1,950.6
|
|
|
$
|
1,760.3
|
|
LENNOX
INTERNATIONAL INC. AND SUBSIDIARIES
Consolidated
Statements of Cash Flows
(Unaudited)
|
|
(Amounts in
millions)
|
For the Three
Months Ended
March 31,
|
|
2017
|
|
2016
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
43.5
|
|
|
$
|
24.9
|
|
Adjustments to
reconcile net income to net cash used in operating
activities:
|
|
|
|
Income from equity
method investments
|
(5.5)
|
|
|
(4.6)
|
|
Restructuring gains,
net of cash paid
|
—
|
|
|
(0.5)
|
|
Provision for bad
debts
|
1.1
|
|
|
1.3
|
|
Unrealized gains on
derivative contracts
|
(0.5)
|
|
|
(0.5)
|
|
Stock-based
compensation expense
|
4.9
|
|
|
6.3
|
|
Depreciation and
amortization
|
15.7
|
|
|
14.2
|
|
Deferred income
taxes
|
(1.1)
|
|
|
(0.5)
|
|
Other items,
net
|
0.1
|
|
|
0.1
|
|
Changes in assets and
liabilities, net of effects of divestitures:
|
|
|
|
Accounts and notes
receivable
|
(40.9)
|
|
|
(44.5)
|
|
Inventories
|
(101.2)
|
|
|
(95.5)
|
|
Other current
assets
|
(4.3)
|
|
|
(6.2)
|
|
Accounts
payable
|
47.3
|
|
|
67.9
|
|
Accrued
expenses
|
(41.7)
|
|
|
(28.0)
|
|
Income taxes payable
and receivable
|
(28.0)
|
|
|
(37.6)
|
|
Other
|
3.0
|
|
|
1.6
|
|
Net cash used in
operating activities
|
(107.6)
|
|
|
(101.6)
|
|
Cash flows from
investing activities:
|
|
|
|
Proceeds from the
disposal of property, plant and equipment
|
0.1
|
|
|
—
|
|
Purchases of
property, plant and equipment
|
(24.9)
|
|
|
(23.8)
|
|
Net cash used in
investing activities
|
(24.8)
|
|
|
(23.8)
|
|
Cash flows from
financing activities:
|
|
|
|
Short-term
borrowings, net
|
(0.8)
|
|
|
(0.4)
|
|
Asset securitization
borrowings
|
150.0
|
|
|
—
|
|
Asset securitization
payments
|
—
|
|
|
(20.0)
|
|
Long-term debt
payments
|
(0.2)
|
|
|
(0.3)
|
|
Borrowings from
credit facility
|
583.0
|
|
|
770.5
|
|
Payments on credit
facility
|
(497.5)
|
|
|
(392.0)
|
|
Proceeds from
employee stock purchases
|
0.7
|
|
|
0.6
|
|
Repurchases of common
stock
|
(75.0)
|
|
|
(200.0)
|
|
Repurchases of common
stock to satisfy employee withholding tax obligations
|
(13.3)
|
|
|
(16.8)
|
|
Cash dividends
paid
|
(18.5)
|
|
|
(16.1)
|
|
Net cash provided
by financing activities
|
128.4
|
|
|
125.5
|
|
(Decrease) increase
in cash and cash equivalents
|
(4.0)
|
|
|
0.1
|
|
Effect of exchange
rates on cash and cash equivalents
|
2.6
|
|
|
1.6
|
|
Cash and cash
equivalents, beginning of period
|
50.2
|
|
|
38.9
|
|
Cash and cash
equivalents, end of period
|
$
|
48.8
|
|
|
$
|
40.6
|
|
|
|
|
|
Supplemental
disclosures of cash flow information:
|
|
|
|
Interest
paid
|
$
|
2.4
|
|
|
$
|
3.3
|
|
Income taxes paid
(net of refunds)
|
$
|
36.7
|
|
|
$
|
51.2
|
|
LENNOX
INTERNATIONAL INC. AND SUBSIDIARIES
|
Reconciliation to
U.S. GAAP (Generally Accepted Accounting Principles)
Measures
|
(Unaudited, in
millions, except per share and ratio data)
|
Use of Non-GAAP
Financial Measures
|
|
|
|
|
|
To supplement the
Company's consolidated financial statements and segment net sales
and profit presented in accordance with U.S. GAAP, additional
non-GAAP financial measures are provided and reconciled in the
following tables. In addition to these non-GAAP measures, the
Company also provides rates of revenue change at constant currency
on a consolidated and segment basis if different than the
reported measures. The Company believes that these non-GAAP
financial measures, when considered together with the GAAP
financial measures, provide information that is useful to investors
in understanding period-over-period operating results. The
Company believes that these non-GAAP financial measures enhance the
ability of investors to analyze the Company's business trends and
operating performance.
|
|
Reconciliation of
Income from Continuing Operations, a GAAP measure, to Adjusted
Income from Continuing Operations, a Non-GAAP
measure
|
|
|
For the Three
Months Ended March 31,
|
|
2017
|
|
2016
|
|
Pre-Tax
|
Tax Impact
(e)
|
After
Tax
|
|
Pre-Tax
|
Tax Impact
(e)
|
After
Tax
|
Income from
continuing operations, a GAAP measure
|
$
|
53.4
|
|
$
|
(9.9)
|
|
$
|
43.5
|
|
|
$
|
37.9
|
|
$
|
(13.0)
|
|
$
|
24.9
|
|
Restructuring
charges
|
0.1
|
|
—
|
|
0.1
|
|
|
(0.2)
|
|
0.1
|
|
(0.1)
|
|
Special product
quality adjustments (b)
|
—
|
|
—
|
|
—
|
|
|
(0.4)
|
|
0.1
|
|
(0.3)
|
|
Special legal
contingency charges (a)
|
0.9
|
|
—
|
|
0.9
|
|
|
1.7
|
|
(0.5)
|
|
1.2
|
|
Asbestos-related
litigation (a)
|
1.7
|
|
(0.6)
|
|
1.1
|
|
|
0.8
|
|
(0.3)
|
|
0.5
|
|
Net change in
unrealized losses (gains) on unsettled future contracts
(a)
|
0.7
|
|
(0.3)
|
|
0.4
|
|
|
(0.5)
|
|
0.2
|
|
(0.3)
|
|
Environmental
liabilities(a)
|
0.5
|
|
(0.2)
|
|
0.3
|
|
|
0.7
|
|
(0.2)
|
|
0.5
|
|
Excess tax benefits
from share-based compensation (c)
|
—
|
|
(7.4)
|
|
(7.4)
|
|
|
—
|
|
—
|
|
—
|
|
Contractor tax payments (a)
|
—
|
|
—
|
|
—
|
|
|
0.5
|
|
(0.2)
|
|
0.3
|
|
Other items, net
(a)
|
—
|
|
—
|
|
—
|
|
|
0.4
|
|
(0.1)
|
|
0.3
|
|
Adjusted income
from continuing operations, a non-GAAP measure
|
$
|
57.3
|
|
$
|
(18.4)
|
|
$
|
38.9
|
|
|
$
|
40.9
|
|
$
|
(13.9)
|
|
$
|
27.0
|
|
|
|
|
|
|
|
|
|
Earnings per share
from continuing operations - diluted, a GAAP measure
|
|
|
$
|
1.00
|
|
|
|
|
$
|
0.56
|
|
Restructuring
charges
|
|
|
—
|
|
|
|
|
(0.01)
|
|
Special product
quality adjustments (b)
|
|
|
—
|
|
|
|
|
(0.01)
|
|
Special legal
contingency charges(a)
|
|
|
0.02
|
|
|
|
|
0.03
|
|
Asbestos-related
litigation(a)
|
|
|
0.03
|
|
|
|
|
0.01
|
|
Net change in
unrealized losses (gains) on unsettled future contracts
(a)
|
|
|
0.01
|
|
|
|
|
(0.01)
|
|
Environmental
liabilities (a)
|
|
|
0.01
|
|
|
|
|
0.01
|
|
Excess tax benefits
from share-based compensation (c)
|
|
|
(0.17)
|
|
|
|
|
—
|
|
Contractor tax
payments (a)
|
|
|
—
|
|
|
|
|
0.01
|
|
Other items, net
(a)
|
|
|
—
|
|
|
|
|
0.01
|
|
Change in share
counts from share-based compensation (d)
|
|
|
—
|
|
|
|
|
—
|
|
Adjusted earnings
per share from continuing operations - diluted, a non-GAAP
measure
|
|
|
$
|
0.90
|
|
|
|
|
$
|
0.60
|
|
|
(a) Recorded in
Losses (gains) and other expenses, net in the Consolidated
Statements of Operations
|
(b) Recorded in Cost
of goods sold in the Consolidated Statements of
Operations
|
(c) Recorded in
Provision for income taxes in the Consolidated Statements of
Operations
|
(d) The impact of
excess tax benefits from the change in share-based compensation
also impacts our diluted share counts. The reconciliation of
average outstanding diluted shares on a GAAP and non-GAAP basis is
included in this document.
|
(e) Tax impact based
on the applicable tax rate relevant to the location and nature of
the adjustment.
|
|
For the Three
Months Ended
March 31,
|
|
2017
|
|
2016
|
Components of
Losses and other expenses, net (pre-tax):
|
|
|
|
Realized (gains)
losses on settled future contracts (a)
|
$
|
(0.4)
|
|
|
$
|
0.5
|
|
Foreign currency
exchange (gains) losses (a)
|
(0.2)
|
|
|
0.2
|
|
Gains on disposal of
fixed assets (a)
|
(0.1)
|
|
|
—
|
|
Net change in
unrealized losses (gains) on unsettled futures contracts
(b)
|
0.7
|
|
|
(0.5)
|
|
Special legal
contingency charges (b)
|
0.9
|
|
|
1.7
|
|
Asbestos-related
litigation (b)
|
1.7
|
|
|
0.8
|
|
Environmental
liabilities (b)
|
0.5
|
|
|
0.7
|
|
Contractor tax
payments (b)
|
—
|
|
|
0.5
|
|
Acquisition costs
(b)
|
—
|
|
|
0.4
|
|
Other items, net
(b)
|
—
|
|
|
—
|
|
Losses and other
expenses, net (pre-tax)
|
$
|
3.1
|
|
|
$
|
4.3
|
|
|
(a)
Included in both segment profit (loss) and Adjusted income from
continuing operations
|
(b)
Excluded from both segment profit (loss) and Adjusted income from
continuing operations
|
Reconciliation of
Earnings per Share from Continuing Operations - Diluted, a GAAP
measure, to Estimated Adjusted Earnings per Share from Continuing
Operations - Diluted, a Non-GAAP measure
|
|
|
|
|
|
For the Year
Ended
December 31, 2017 ESTIMATED
|
Earnings per share
from continuing operations - diluted, a GAAP measure
|
$7.65 -
$8.25
|
Excess tax benefits
from share-based compensation and other items
|
(0.10)
|
Adjusted Earnings
per share from continuing operations - diluted, a Non-GAAP
measure
|
$7.55 -
$8.15
|
|
|
Reconciliation of
Average Shares Outstanding - Diluted, a GAAP measure, to Adjusted
Average Shares Outstanding - Diluted, a Non-GAAP measure (shares in
millions):
|
|
|
|
For the Three
Months Ended
March 31,
|
|
|
2017
|
|
2016
|
Average shares
outstanding - diluted, a GAAP measure
|
|
43.5
|
|
44.7
|
Impact on diluted
shares from excess tax benefits from share-based
compensation
|
|
(0.2)
|
|
—
|
Adjusted average
shares outstanding - diluted, a Non- GAAP measure
|
|
43.3
|
|
44.7
|
|
|
|
|
|
|
Reconciliation of
Net Cash Used in Operating Activities, a GAAP measure, to Free Cash
Flow, a Non-GAAP measure (dollars in millions)
|
|
|
|
For the Three
Months Ended
March 31,
|
|
|
2017
|
|
2016
|
Net cash used in
operating activities, a GAAP measure
|
|
$
|
(107.6)
|
|
|
$
|
(101.6)
|
|
Purchases of
property, plant and equipment
|
|
(24.9)
|
|
|
(23.8)
|
|
Proceeds from
the disposal of property, plant and equipment
|
|
0.1
|
|
|
—
|
|
Free cash
flow, a Non-GAAP measure
|
|
$
|
(132.4)
|
|
|
$
|
(125.4)
|
|
|
|
|
|
|
Calculation of
Debt to EBITDA Ratio (dollars in millions):
|
|
|
|
Trailing Twelve Months to March 31, 2017
|
Adjusted EBIT
(a)
|
|
|
|
$
|
487.6
|
|
Depreciation
and amortization expense (b)
|
|
|
|
59.7
|
|
EBITDA (a +
b)
|
|
|
|
$
|
547.3
|
|
Total debt at
March 31, 2017 (c)
|
|
|
|
$
|
1,103.1
|
|
Total Debt
to EBITDA ratio ((c / (a + b))
|
|
|
|
2.0
|
|
|
|
|
|
|
Reconciliation of
Adjusted EBIT, a Non-GAAP measure, to Income From Continuing
Operations Before Income Taxes, a GAAP measure (dollars in
millions)
|
|
|
|
|
|
Trailing Twelve Months to March 31, 2017
|
Adjusted
EBIT per above, a Non-GAAP measure
|
$
|
487.6
|
|
Items in Losses
(gains) and other expenses, net that are excluded from segment
profit
|
7.6
|
|
Restructuring
charges
|
2.1
|
|
Interest
expense, net
|
28.6
|
|
Pension
Settlement
|
31.4
|
|
Other expenses,
net
|
(0.3)
|
|
Income from
continuing operations before income taxes, a GAAP
measure
|
$
|
418.2
|
|
![](https://mma.prnewswire.com/media/95644/lennox_international_logo.jpg)
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/lennox-international-reports-record-first-quarter-revenue-and-profit-300443651.html
SOURCE Lennox International Inc.