Market Newsdesk

April 28, 2021 6:48 am

RPC, Inc. Reports First Quarter 2021 Financial Results

PR Newswire

ATLANTA, April 28, 2021 /PRNewswire/ — RPC, Inc. (NYSE: RES) today announced its unaudited results for the first quarter ended March 31, 2021. RPC provides a broad range of specialized oilfield services and equipment primarily to independent and major oilfield companies engaged in the exploration, production and development of oil and gas properties throughout the United States and in selected international markets.

For the quarter ended March 31, 2021, RPC generated revenues of $182.6 million, a decrease of 25.1 percent compared to $243.8 million in the first quarter of 2020. Operating loss for the first quarter of 2021 was $10.5 million compared to an operating loss of $218.7 million and an adjusted operating loss of $13.2 million in the first quarter of the prior year.¹ Net loss for the first quarter of 2021 was $9.7 million, or $0.05 loss per share, compared to a net loss of $160.4 million, or $0.76 loss per share in first quarter of the prior year. In the first quarter of 2020 the adjusted net loss was $9.0 million, or $0.04 adjusted loss per share.² Earnings before interest, taxes, depreciation and amortization (EBITDA) for the first quarter of 2021 was $7.8 million, compared to negative EBITDA of $179.7 million and an adjusted EBITDA of $25.8 million in the same period of the prior year.³

Cost of revenues during the first quarter of 2021 was $146.2 million, or 80.1 percent of revenues, compared to $181.9 million, or 74.6 percent of revenues during the first quarter of 2020. Cost of revenues declined primarily due to decreases in expenses consistent with lower activity levels and RPC’s ongoing cost reduction initiatives. Cost of revenues as a percentage of revenues increased primarily due to labor and other cost inefficiencies resulting from lower activity levels, as well as increased diesel fuel costs, in the first quarter as compared to the prior year.

Selling, general and administrative expenses were $30.6 million in the first quarter of 2021 compared to $36.5 million in the first quarter of 2020. These expenses decreased due to lower employment costs, primarily the result of cost reduction initiatives during previous quarters. Selling, general and administrative expenses increased from 15.0 percent of revenues in the first quarter of 2020 to 16.8 percent of revenues in the first quarter of 2021. Depreciation and amortization was $17.8 million in the first quarter of 2021 compared to $39.3 million in the first quarter of the prior year. Depreciation and amortization declined primarily because of RPC’s asset impairment charges recorded in prior quarters.

Discussion of Sequential Quarterly Financial Results

RPC’s revenues for the quarter ended March 31, 2021 increased by $34.0 million compared to the prior quarter, or 22.9 percent, due to activity increases in most service lines. Cost of revenues during the first quarter of 2021 increased by $28.3 million, or 24.0 percent, due to expenses which increase with higher activity levels such as materials and supplies and employment costs. As a percentage of revenues, cost of revenues increased slightly from 79.3 percent in the fourth quarter of 2020 to 80.1 percent in the first quarter of 2021 due to increases in maintenance and repair expenses and fuel costs. Selling, general and administrative expenses increased by $4.6 million in the first quarter of 2021 compared to the prior quarter, primarily due to a beneficial forfeiture rate adjustment to stock compensation recorded in the prior quarter. RPC’s operating loss in the first quarter of 2021 was $10.5 million, compared to an operating loss of $21.6 million and an adjusted operating loss of $11.3 million for the fourth quarter of 2020.¹ EBITDA for the first quarter of 2021 was $7.8 million compared to negative EBITDA of $2.5 million and adjusted EBITDA of $7.8 million in the fourth quarter of 2020.³

The average U.S. domestic rig count during the first quarter of 2021 was 396, a 49.6 percent decrease compared to the same period in 2020, but a 27.3 percent increase compared to the fourth quarter of 2020. The average price of oil during the first quarter of 2021 was $58.13 per barrel, a 23.1 percent increase compared to the same period in 2020, and a 36.4 percent increase compared to the fourth quarter of 2020. The average price of natural gas during the first quarter of 2021 was $3.59 per Mcf, an 87.0 percent increase compared to the same period in 2020, and a 43.6 percent increase compared to the fourth quarter of 2020.

Management Commentary

“First quarter revenues increased compared to the prior quarter in all of our major service lines as oil prices increased and customers initiated their annual drilling and completion plans,” stated Richard A. Hubbell, RPC’s President and Chief Executive Officer. “Equipment and crew utilization increased as we continued to improve efficiencies and streamlined operations. Job mix in several service lines contributed to our sequential revenue growth as well. These activity improvements were partially offset by the extreme winter weather in February in many of our markets, particularly the Permian Basin. This event hurt profitability because of weather-related expenses and inefficiencies arising from a two-week long operational disruption.

“As we begin the second quarter, we believe near-term industry activity will be similar to the first quarter, adjusted for the weather impact. Although drilling and completion activities have improved, supported by higher oil prices and customer spending, the oilfield services industry is still faced with overcapacity. We believe pricing for our services will continue to be intensely competitive, and financial returns do not presently support significant growth capital expenditures. Our first quarter capital expenditures of $11.8 million reflect this conservative outlook, and we are pleased that our cash balance at the end of the quarter was $85.4 million, slightly higher than year-end 2020,” concluded Hubbell.

Summary of Segment Operating Performance

RPC manages two operating segments – Technical Services and Support Services.

Technical Services includes RPC’s oilfield service lines that utilize people and equipment to perform value-added completion, production and maintenance services directly to a customer’s well. These services are generally directed toward improving the flow of oil and natural gas from producing formations or to address well control issues. The Technical Services segment includes pressure pumping, downhole tools and services, coiled tubing, hydraulic workover services, nitrogen, surface pressure control equipment, well control, and fishing tool operations.

Support Services includes RPC’s oilfield service lines that provide equipment for customer use or services to assist customer operations. The equipment and services offered include rental of tubulars and related tools, pipe handling, inspection and storage services, and oilfield training services.

Technical Services quarterly revenues decreased by 24.2 percent compared to the same period of the prior year due to significantly lower activity and pricing. On a sequential basis, Technical Services revenues increased by 24.2 percent compared to the prior quarter due to increased activity levels in most of the segment’s service lines. Support Services revenues decreased by 38.0 percent during the first quarter compared to the same period of the prior year. On a sequential basis, Support Services revenues increased by 3.2 percent compared to the prior quarter. Technical Services narrowed its operating loss during the first quarter of 2021 compared to the fourth quarter of 2020 due to higher activity levels.

(in thousands)		Three Months Ended
		March 31,		December 31,		March 31,
		2021		2020		2020

Revenues:
Technical Services	$	172,641	$	138,978	$	227,700
Support Services		9,969		9,659		16,077
Total revenues	$	182,610	$	148,637	$	243,777
Operating (loss) profit:
Technical Services	$	(5,762)	$	(11,277)	$	(12,207)
Support Services		(2,896)		(2,575)		1,547
Corporate expenses		(3,323)		577		(3,330)
Impairment and other charges *		–		(10,318)		(205,536)
Gain on disposition of assets, net		1,460		1,947		819
Total operating loss	$	(10,521)	$	(21,646)	$	(218,707)
Interest expense		(380)		(116)		(113)
Interest income		18		65		334
Other income (expense), net		507		1,101		(308)

Loss before income taxes	$	(10,376)	$	(20,596)	$	(218,794)


* December 2020 represents $5,658 of impairment charges related to Technical Services and $4,660 related
to pension settlement loss. March 2020 relates exclusively to Technical Services.

RPC, Inc. will hold a conference call today, April 28, 2021 at 9:00 a.m. ET to discuss the results for the quarter. Interested parties may listen in by accessing a live webcast in the investor relations section of RPC, Inc.’s website at rpc.net. The live conference call can also be accessed by calling (833) 579-0910 or (778) 560-2620 for international callers, and use conference ID number 3471295. For those not able to attend the live conference call, a replay will be available in the investor relations section of RPC, Inc.’s website beginning approximately two hours after the call and for a period of 90 days.

RPC provides a broad range of specialized oilfield services and equipment primarily to independent and major oilfield companies engaged in the exploration, production and development of oil and gas properties throughout the United States, including the Gulf of Mexico, mid-continent, southwest, Appalachian and Rocky Mountain regions, and in selected international markets. RPC’s investor website can be found at rpc.net.

Certain statements and information included in this press release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including all statements that look forward in time or express management’s beliefs, expectations or hopes. These statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of RPC to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements, including our expectations that activity levels during the near term will remain consistent with the first quarter of 2021; our belief that pricing for our services will continue to be intensely competitive; our belief that financial returns do not presently support significant growth capital expenditures. Such risks include changes in general global business and economic conditions, including fluctuations in prices of oil and natural gas; the impact of the COVID-19 pandemic on our operations; credit risks associated with collections of our accounts receivable from customers experiencing challenging business conditions; drilling activity and rig count; risks of reduced availability or increased costs of both labor and raw materials used in providing our services; the impact on our operations due to changes in regulatory and environmental laws; turmoil in the financial markets and the potential difficulty to fund our capital needs; the actions of OPEC+, which could impact drilling activity; adverse weather conditions in oil and gas producing regions; competition in the oil and gas industry; an inability to implement price increases; risks of international operations; and reliance upon large customers. Additional discussion of factors that could cause the actual results to differ materially from management’s projections, forecasts, estimates and expectations is contained in RPC’s Form 10-K for the year ended December 31, 2020.

For information about RPC, Inc., please contact:

Ben M. Palmer	Jim Landers
Chief Financial Officer	Vice President Corporate Services
(404) 321-2140	(404) 321-2162
[email protected]	[email protected]

¹Adjusted operating loss is a financial measure which does not conform to GAAP. Additional disclosure regarding this non-GAAP financial measure and its reconciliation to operating loss, the nearest GAAP financial measure, is disclosed in Appendix A to this press release.

² Adjusted net loss and adjusted loss per share are financial measures which do not conform to GAAP. Additional disclosure regarding these non-GAAP financial measures and their reconciliation to net loss and loss per share, the nearest GAAP financial measures, are disclosed in Appendix B to this press release.

³ Adjusted EBITDA and EBITDA are financial measures which do not conform to GAAP. Additional disclosure regarding these non-GAAP financial measures and their reconciliation to net loss, the nearest GAAP financial measure, is disclosed in Appendix C to this press release.

RPC INCORPORATED AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per share data)
Periods ended, (Unaudited)		Three Months Ended
		March 31, 2021		December 31, 2020		March 31, 2020
REVENUES	$	182,610	$	148,637	$	243,777
COSTS AND EXPENSES:
Cost of revenues		146,223		117,886		181,944
Selling, general and administrative expenses		30,595		26,017		36,530
Impairment and other charges		–		10,318		205,536
Depreciation and amortization		17,773		18,009		39,293
Gain on disposition of assets, net		(1,460)		(1,947)		(819)
Operating loss		(10,521)		(21,646)		(218,707)
Interest expense		(380)		(116)		(113)
Interest income		18		65		334
Other income (expense), net		507		1,101		(308)
Loss before income taxes		(10,376)		(20,596)		(218,794)
Income tax benefit		(714)		(10,357)		(58,371)
NET LOSS	$	(9,662)	$	(10,239)	$	(160,423)


LOSS PER SHARE
Basic	$	(0.05)	$	(0.05)	$	(0.76)
Diluted	$	(0.05)	$	(0.05)	$	(0.76)

WEIGHTED AVERAGE SHARES OUTSTANDING
Basic		212,959		212,708		212,311
Diluted		212,959		212,708		212,311

RPC INCORPORATED AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
At March 31, (Unaudited)		(In thousands)
		2021		2020
ASSETS
Cash and cash equivalents	$	85,421	$	82,646
Accounts receivable, net		186,891		247,965
Inventories		80,165		97,267
Income taxes receivable		82,612		35,000
Prepaid expenses		8,027		8,701
Assets held for sale		4,032		5,385
Other current assets		2,493		2,860
Total current assets		449,641		479,824
Property, plant and equipment, net		257,309		295,262
Operating lease right-of-use assets		25,400		33,250
Goodwill		32,150		32,150
Other assets		35,573		28,646
Total assets	$	800,073	$	869,132

LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable	$	60,649	$	70,601
Accrued payroll and related expenses		23,074		19,791
Accrued insurance expenses		4,443		7,092
Accrued state, local and other taxes		4,539		3,774
Income taxes payable		1,302		1,791
Current portion of operating lease liabilities		8,594		10,215
Other accrued expenses		946		4,914
Total current liabilities		103,547		118,178
Long-term accrued insurance expenses		10,543		14,865
Long-term pension liabilities		31,088		33,208
Long-term operating lease liabilities		19,088		27,529
Other long-term liabilities		–		49
Deferred income taxes		12,631		4,068
Total liabilities		176,897		197,897
Common stock		21,574		21,526
Capital in excess of par value		–		–
Retained earnings		619,019		672,912
Accumulated other comprehensive loss		(17,417)		(23,203)
Total stockholders’ equity		623,176		671,235
Total liabilities and stockholders’ equity	$	800,073	$	869,132

Appendix A

RPC, Inc. has used the non-GAAP financial measure of adjusted operating loss in today’s earnings release, and anticipates using this non-GAAP financial measure in today’s earnings conference call. This measure should not be considered in isolation or as a substitute for operating loss, or other performance measures prepared in accordance with GAAP.

Management believes that presenting the financial measure of adjusted operating loss enables us to compare our operating performance consistently over various time periods without regard to non-recurring items.

A non-GAAP financial measure is a numerical measure of financial performance, financial position, or cash flows that either 1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows, or 2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. Set forth below is a reconciliation of this non-GAAP measure with its most comparable GAAP measures. This reconciliation also appears on RPC, Inc.’s investor website, which can be found on the Internet at rpc.net.

The Reconciliation of Operating Loss to Adjusted Operating Loss, the nearest performance measure prepared in accordance with GAAP, is shown below:


Periods ended, (Unaudited)		Three Months Ended
(In thousands)		March 31, 2021		December 31, 2020		March 31, 2020


Reconciliation of operating loss to adjusted operating loss

Operating loss	$	(10,521)	$	(21,646)	$	(218,707)
Add:
Impairment and other charges		–		10,318		205,536
Adjusted operating loss	$	(10,521)	$	(11,328)	$	(13,171)

Appendix B

RPC, Inc. has used the non-GAAP financial measures of adjusted net loss and adjusted loss per share, in today’s earnings release and anticipates using these non-GAAP financial measures in today’s earnings conference call. These measures should not be considered in isolation or as a substitute for net loss, loss per share, or other performance measures prepared in accordance with GAAP.

Management believes that presenting the financial measures of adjusted net loss and adjusted loss per share, enable us to compare our operating performance consistently over various time periods without regard to non-recurring items.

The Reconciliation of Net Loss to Adjusted Net Loss and the Reconciliation of Loss Per Share to Adjusted Loss Per Share is shown below:


Periods ended, (Unaudited)		Three Months Ended
(In thousands except per share amounts)		March 31, 2021		December 31, 2020		March 31, 2020

Reconciliation of net loss to adjusted net loss

Net loss	$	(9,662)	$	(10,239)	$	(160,423)
Add:
Discrete tax adjustments		–		(4,581)		22,807
Impairment and other charges, net of tax		–		7,980		128,642
Total impact of discrete tax adjustments
and Impairment and other charges		–		3,399		151,449
Adjusted net loss	$	(9,662)	$	(6,840)	$	(8,974)


Reconciliation of loss per share to adjusted loss per share

Loss per share	$	(0.05)	$	(0.05)	$	(0.76)
Total impact of discrete tax adjustments
and Impairment and other charges	$	–	$	0.02	$	0.71

Adjusted loss per share	$	(0.05)	$	(0.03)	$	(0.04)

Weighted average shares outstanding		212,959		212,708		212,311

Appendix C

RPC has used the non-GAAP financial measures of earnings before interest, taxes, depreciation and amortization (EBITDA) and adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) in today’s earnings release, and anticipates using EBITDA and adjusted EBITDA in today’s earnings conference call. EBITDA and adjusted EBITDA should not be considered in isolation or as a substitute for net loss or other performance measures prepared in accordance with GAAP.

RPC uses EBITDA and adjusted EBITDA as a measure of operating performance because it allows us to compare performance consistently over various periods without regard to changes in our capital structure or non-recurring items. We are also required to use EBITDA to report compliance with financial covenants under our revolving credit facility.

A non-GAAP financial measure is a numerical measure of financial performance, financial position, or cash flows that either 1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows, or 2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. Set forth below is a reconciliation of net loss to EBITDA and adjusted EBITDA, the most comparable GAAP measures. This reconciliation also appears on RPC’s investor website, which can be found on the Internet at rpc.net.

The Reconciliation of Net Loss to EBITDA and Adjusted EBITDA is shown below:


Periods ended, (Unaudited)		Three Months Ended
(In thousands)		March 31, 2021		December 31, 2020		March 31, 2020

Reconciliation of net loss to EBITDA and adjusted EBITDA
Net loss	$	(9,662)	$	(10,239)	$	(160,423)
Add:
Income tax benefit		(714)		(10,357)		(58,371)
Interest expense		380		116		113
Depreciation and amortization		17,773		18,009		39,293
Less:
Interest income		18		65		334
EBITDA	$	7,759	$	(2,536)	$	(179,722)
Add:
Impairment and other charges		–		10,318		205,536
Adjusted EBITDA	$	7,759	$	7,782	$	25,814

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SOURCE RPC, Inc.

April 28, 2021 6:48 am

CGI to acquire Sense Corp, expanding footprint in Texas and St. Louis and end-to-end capabilities for state and local government and commercial clients

PR Newswire

FAIRFAX, Va., April 28, 2021 /PRNewswire/ — CGI (NYSE: GIB) (TSX: GIB.A) today announced its intent to acquire Sense Corp, a professional services firm focused on digital systems integration and consulting for state and local government and commercial clients. This merger further expands CGI’s footprint in Austin, Dallas, Houston, and St. Louis and grows CGI’s digital and cloud solution capabilities. The two companies signed an agreement to proceed with the transaction, which is expected to close in early May.

Sense Corp brings approximately 300 highly skilled consultants to CGI, and enhances and accelerates CGI’s position as a leading provider of comprehensive, scalable and sustainable IT and business consulting services to meet growing demand in both the state and local government and commercial sectors.

“This transaction is consistent with CGI’s well-articulated build and buy strategy to invest in both transformational and niche acquisitions that will spur future growth and expand coverage in targeted metro markets,” said Tim Hurlebaus, CGI President of U.S. Commercial and State Government Operations. “By merging forces with Sense Corp, it will have a significant positive impact on our U.S. Texas and Midwest operations while acting as a catalyst for future organic growth for the overall U.S. business.”

“One of the most closely scrutinized aspects of any merger is the alignment of culture. CGI and Sense Corp share a commitment to help clients by providing valuable insights and working together to deliver positive outcomes,” said Jody Beasley, CGI Senior Vice-President, Consulting Services and U.S. Texas Business Unit Leader. “Sense Corp brings both unique local relationships and deep industry experience to the CGI global platform.”

In the U.S., CGI has nearly 13,000 consultants and professionals across 80 offices that are organized through a client proximity model, supported by the depth of its international presence, range of services, and insights to deliver value locally.

About CGI

Founded in 1976, CGI is among the largest independent IT and business consulting services firms in the world. With 77,000 consultants and other professionals across the globe, CGI delivers an end-to-end portfolio of capabilities, from strategic IT and business consulting to systems integration, managed IT and business process services and intellectual property solutions. CGI works with clients through a local relationship model complemented by a global delivery network that helps clients digitally transform their organizations and accelerate results. CGI Fiscal 2020 reported revenue is C$12.16 billion and CGI shares are listed on the TSX (GIB.A) and the NYSE (GIB). Learn more at cgi.com.

Forward-looking information and statements
This press release contains “forward-looking information” within the meaning of Canadian securities laws and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and other applicable United States safe harbours. All such forward-looking information and statements are made and disclosed in reliance upon the safe harbour provisions of applicable Canadian and United States securities laws. Forward-looking information and statements include all information and statements regarding CGI’s intentions, plans, expectations, beliefs, objectives, future performance, and strategy, as well as any other information or statements that relate to future events or circumstances and which do not directly and exclusively relate to historical facts. Forward-looking information and statements often but not always use words such as “believe”, “estimate”, “expect”, “intend”, “anticipate”, “foresee”, “plan”, “predict”, “project”, “aim”, “seek”, “strive”, “potential”, “continue”, “target”, “may”, “might”, “could”, “should”, and similar expressions and variations thereof. These information and statements are based on our perception of historic trends, current conditions and expected future developments, as well as other assumptions, both general and specific, that we believe are appropriate in the circumstances. Such information and statements are, however, by their very nature, subject to inherent risks and uncertainties, of which many are beyond the control of CGI, and which give rise to the possibility that actual results could differ materially from our expectations expressed in, or implied by, such forward-looking information or forward-looking statements. These risks and uncertainties include but are not restricted to: risks related to the market such as the level of business activity of our clients, which is affected by economic and political conditions, external risks (such as pandemics) and our ability to negotiate new contracts; risks related to our industry such as competition and our ability to attract and retain qualified employees, to develop and expand our services, to penetrate new markets, and to protect our intellectual property rights; risks related to our business such as risks associated with our growth strategy, including the integration of new operations, financial and operational risks inherent in worldwide operations, foreign exchange risks, income tax laws, our ability to negotiate favourable contractual terms, to deliver our services and to collect receivables, and the reputational and financial risks attendant to cybersecurity breaches and other incidents; as well as other risks identified or incorporated by reference in this press release, in CGI’s annual and quarterly MD&A and in other documents that we make public, including our filings with the Canadian Securities Administrators (on SEDAR at www.sedar.com) and the U.S. Securities and Exchange Commission (on EDGAR at www.sec.gov). For a discussion of risks in response to the coronavirus (COVID-19) pandemic, see Pandemic Risks in section 8.1.1. of our Q2 2021 quarterly MD&A. Unless otherwise stated, the forward-looking information and statements contained in this press release are made as of the date hereof and CGI disclaims any intention or obligation to publicly update or revise any forward-looking information or forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. While we believe that our assumptions on which these forward-looking information and forward-looking statements are based were reasonable as at the date of this press release, readers are cautioned not to place undue reliance on these forward-looking information or statements. Furthermore, readers are reminded that forward-looking information and statements are presented for the sole purpose of assisting investors and others in understanding our objectives, strategic priorities and business outlook as well as our anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes. Further information on the risks that could cause our actual results to differ significantly from our current expectations may be found in the section titled “Risk Environment” of CGI’s annual and quarterly MD&A, which is incorporated by reference in this cautionary statement. We also caution readers that the above-mentioned risks and the risks disclosed in CGI’s annual and quarterly MD&A and other documents and filings are not the only ones that could affect us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial could also have a material adverse effect on our financial position, financial performance, cash flows, business or reputation.

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SOURCE CGI Technologies and Solutions, Inc.

April 28, 2021 6:48 am

NetEase, Inc. Announces Filing of Annual Report on Form 20-F for Fiscal Year 2020

PR Newswire

BEIJING, April 28, 2021 /PRNewswire/ — NetEase, Inc. (NASDAQ: NTES and HKEX: 9999) today announced that it filed its annual report on Form 20-F for the fiscal year ended December 31, 2020. The annual report can be accessed on the Company’s investor relations website at http://ir.netease.com/financial-information/annual-reports.

The Company will provide a hard copy of its annual report containing the audited consolidated financial statements, free of charge, to its shareholders and ADS holders upon request. Requests should be directed to the IR Department, NetEase, Inc., NetEase Building, No. 399 Wangshang Road, Binjiang District, Hangzhou, 310052, People’s Republic of China at the contact information listed above.

About NetEase, Inc.

As a leading internet technology company based in China, NetEase, Inc. (NASDAQ: NTES and HKEX: 9999, “NetEase”) is dedicated to providing premium online services centered around innovative and diverse content, community, communication and commerce. NetEase develops and operates some of China’s most popular mobile and PC games. In more recent years, NetEase has expanded into international markets including Japan and North America. In addition to its self-developed game content, NetEase partners with other leading game developers, such as Blizzard Entertainment and Mojang AB (a Microsoft subsidiary), to operate globally renowned games in China. NetEase’s other innovative service offerings include the intelligent learning services of its majority-controlled subsidiary, Youdao (NYSE: DAO); music streaming through its leading NetEase Cloud Music business; and its private label e-commerce platform, Yanxuan. For more information, please visit: http://ir.netease.com/.

Contact for Media and Investors:

Margaret Shi

Email: [email protected]
Tel: (+86) 571-8985-3378
Twitter: https://twitter.com/NetEase_Global

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SOURCE NetEase, Inc.

April 28, 2021 6:48 am

Marine Products Corporation Reports First Quarter 2021 Financial Results

PR Newswire

ATLANTA, April 28, 2021 /PRNewswire/ — Marine Products Corporation (NYSE: MPX) announced its unaudited results for the quarter ended March 31, 2021. Marine Products is a leading manufacturer of fiberglass boats under three brand names: Chaparral, Robalo and Vortex. Chaparral’s sterndrive models include SSi and SSX, along with the Chaparral Surf Series. Chaparral’s outboard offerings include OSX Luxury Sportboats, the 267 SSX OB, SSi outboard models and SunCoast Sportdecks. Robalo builds an array of outboard sport fishing boats, which include center consoles, dual consoles and Cayman Bay Boat models. Chaparral also offers jet powered boats under the Vortex brand name.

For the quarter ended March 31, 2021, Marine Products generated net sales of $78,375,000, a 32.6 percent increase compared to $59,119,000 in the same period of the prior year. The increase in net sales was due to a 17.9 percent increase in the number of units sold during the quarter as compared to the prior year as well as a 15.5 percent increase in average selling price per boat. Unit sales increased in all of our major product categories. Average selling prices also increased compared to the first quarter of the prior year due to a model mix that included more of our larger boats.

Gross profit for the first quarter of 2021 was $18,462,000, a 52.5 percent increase compared to gross profit of $12,107,000 in the same period of the prior year. Gross margin as a percentage of net sales increased to 23.6 percent in the first quarter of 2021 compared to 20.5 percent in the first quarter of 2020. Gross margin as a percentage of net sales increased due to manufacturing efficiencies resulting from higher production and a favorable model mix during the first quarter of 2021 as compared to the prior year.

Operating profit for the first quarter of 2021 was $10,025,000, an increase of 106.5 percent compared with operating profit of $4,854,000 in the first quarter of last year. Selling, general and administrative expenses were $8,437,000 in the first quarter of 2021 compared to $7,253,000 in the first quarter of 2020. These expenses increased due to costs that vary with sales and profitability, such as incentive compensation and warranty expense, partially offset by marketing cost savings during the quarter. Selling, general and administrative expenses as a percentage of net sales were 10.8 percent in the first quarter of 2021 compared to 12.3 percent of net sales during the first quarter of 2020.

Net income for the first quarter of 2021 was $8,097,000, an increase of $3,889,000, or 92.4 percent, compared with net income of $4,208,000 in the first quarter of 2020. Diluted earnings per share were $0.24 in the first quarter of 2021 compared to $0.12 in the first quarter of 2020. The effective tax rate for the first quarter of 2021 was 19.3 percent, an increase compared to an effective tax rate of 14.4 percent for the first quarter of the prior year.

Richard A. Hubbell, Marine Products’ President and Chief Executive Officer stated, “Our first quarter results reflect continued strong interest in recreational boating and the appeal of our products, as dealers continue to report strong retail demand in all of the markets. We generated strong sales across all our product lines. Although most of the winter boat shows were cancelled this year, our virtual and limited in-person marketing and sales efforts have been successful and we are looking forward to a very strong retail selling season, as our order backlog remains at historically high levels. We continue to be pleased by our growing market share. Updated statistics for the 12 months ended December 31, 2020 indicate that market share in our Robalo product line increased slightly, as did the combination of our Robalo and Chaparral outboard units. Market share within our Chaparral sterndrive models increased as well, and that product line continues to hold the second highest market share in its category.

“We are optimistic about the continued strength in the recreational boat market and our near-term financial results. However, like so many manufacturing businesses, we have started to experience supply chain disruptions which will impact our second quarter production and sales growth. We are working closely with our suppliers to understand these disruptions and manage our manufacturing processes, and we are communicating with our dealers and retail customers to manage their expectations and seek the best possible outcomes during this extraordinary time,” concluded Hubbell.

Marine Products Corporation will hold a conference call today, April 28, 2021, at 8:00 a.m. Eastern Time to discuss the results for the quarter. Interested parties may listen in by accessing a live webcast in the investor relations section of Marine Products’ website at marineproductscorp.com. Additionally, the live conference call can be accessed by calling (833) 968-2235 or (825) 312-2057 for international callers, and using conference ID number 6784804. A replay will be available in the investor relations section of Marine Products’ website beginning approximately two hours after the call.

Marine Products Corporation (NYSE: MPX) designs, manufactures and distributes premium-branded Chaparral sterndrive and outboard pleasure boats, Vortex jet drive boats, and Robalo outboard sport fishing boats. The Company continues to diversify its product lines through product innovation. With premium brands, a solid capital structure, and a strong independent dealer network, Marine Products Corporation is prepared to capitalize on opportunities to increase its market share and to generate superior financial performance to build long-term shareholder value. For more information on Marine Products Corporation visit our website at MarineProductsCorp.com.

Certain statements and information included in this press release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements that look forward in time or express management’s beliefs, expectations or hopes. In particular, such statements include, without limitation, the statement that we are looking forward to a very strong retail selling season; our optimism about the continued strength in the recreational boat market and our near-term financial results; and our belief that supply chain disruptions will impact our second quarter production and sales growth. These statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Marine Products Corporation to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements. These risks include risks related to the supply chain disruptions that may impact our production and sales in 2021. Additional discussion of factors that could cause the actual results to differ materially from management’s projections, forecasts, estimates and expectations is contained in Marine Products’ Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission (the “SEC”) for the year ended December 31, 2020.

For information contact:
BEN M. PALMER	JIM LANDERS
Chief Financial Officer	Vice President Corporate Services
(404) 321-7910	(404) 321-2162
[email protected]	[email protected]

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per share data)
Period ended March 31, (Unaudited)		First Quarter
		2021		2020	% BETTER (WORSE)
Net Sales	$	78,375	$	59,119	32.6	%
Cost of Goods Sold		59,913		47,012	(27.4)
Gross Profit		18,462		12,107	52.5
Selling, General and Administrative Expenses		8,437		7,253	(16.3)
Operating Profit		10,025		4,854	106.5
Interest Income		8		61	(86.9)
Income Before Income Taxes		10,033		4,915	104.1
Income Tax Provision		1,936		707	(173.8)
Net Income	$	8,097	$	4,208	92.4	%


EARNINGS PER SHARE
Basic	$	0.24	$	0.12	100.0	%
Diluted	$	0.24	$	0.12	100.0	%

AVERAGE SHARES OUTSTANDING
Basic		33,958		33,940
Diluted		33,958		33,940

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
At March 31, (Unaudited)		(in thousands)
		2021		2020
ASSETS
Cash and cash equivalents	$	35,016	$	20,064
Accounts receivable, net		7,727		9,170
Inventories		45,929		45,946
Income taxes receivable		551		733
Prepaid expenses and other current assets		2,161		1,442
Total current assets		91,384		77,355
Property, plant and equipment, net		14,727		14,925
Goodwill		3,308		3,308
Other intangibles, net		465		465
Pension assets		12,662		6,662
Deferred income taxes		3,917		3,429
Other assets		3,702		3,681
Total assets	$	130,165	$	109,825

LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable	$	10,847	$	9,803
Accrued expenses and other liabilities		16,583		13,708
Total current liabilities		27,430		23,511
Long-term pension liabilities		13,209		8,805
Other long-term liabilities		791		523
Total liabilities		41,430		32,839
Common stock		3,399		3,397
Capital in excess of par value		–		–
Retained earnings		87,269		76,218
Accumulated other comprehensive loss		(1,933)		(2,629)
Total stockholders’ equity		88,735		76,986
Total liabilities and stockholders’ equity	$	130,165	$	109,825

View original content:http://www.prnewswire.com/news-releases/marine-products-corporation-reports-first-quarter-2021-financial-results-301278461.html

SOURCE Marine Products Corporation

April 28, 2021 6:48 am

Helen of Troy Limited Reports Fourth Quarter Fiscal 2021 Results

Helen of Troy Limited Reports Fourth Quarter Fiscal 2021 Results

Consolidated Net Sales Growth of 15.1% Despite Adverse February Winter Storm Impact

Organic Business Net Sales Growth of 12.2%; Leadership Brand Net Sales Growth of 20.2%

GAAP Diluted Earnings Per Share (“EPS”) of $0.90; Includes Impairment Charge of $0.30

Adjusted Diluted EPS of $1.57 Despite Adverse February Winter Storm Impact

Full Year Consolidated Net Sales Growth of 22.9%

Full Year GAAP Diluted EPS of $10.08

Full Year Adjusted Diluted EPS Growth of 25.3% to $11.65

Full Year Operating Cash Flow Growth of 15.8% to $314.1 million

EL PASO, Texas–(BUSINESS WIRE)–Helen of Troy Limited (NASDAQ: HELE), designer, developer and worldwide marketer of consumer brand-name housewares, health and home, and beauty products, today reported results for the three-month period ended February 28, 2021.

Executive Summary – Fourth Quarter of Fiscal 2021

Consolidated net sales revenue increase of 15.1% to $509.4 million, including:
- An adverse impact from February Winter Storm Uri of approximately $15 million, or 3.4%
- An increase in Leadership Brand net sales of 20.2%
- An increase in online channel net sales of approximately 30%
- Organic business net sales growth of 12.2%
- Core business net sales growth of 16.2%

GAAP consolidated operating income of $24.5 million, or 4.8% of net sales, which includes a non-cash asset impairment charge of $8.5 million, compared to a GAAP operating loss of $2.7 million, or 0.6% of net sales, for the same period last year, which included acquisition-related expenses of $1.1 million, non-cash asset impairment charges of $41.0 million, and restructuring charges of $2.3 million

Non-GAAP consolidated adjusted operating income decrease of 20.5% to $42.9 million, or 8.4% of net sales, compared to $53.9 million, or 12.2% of net sales, for the same period last year

GAAP diluted EPS of $0.90, which includes a non-cash asset impairment charge of $0.30 per share, compared to a GAAP diluted loss per share of $0.13 for the same period last year, which included acquisition-related expenses of $0.04 per share, non-cash asset impairment charges of $1.43 per share, and restructuring charges of $0.08 per share

Non-GAAP adjusted diluted EPS of $1.57 despite an adverse winter storm impact of approximately $0.20, compared to $1.88 for the same period last year

Executive Summary – Fiscal 2021

Consolidated net sales revenue increase of 22.9% including:
- An increase in Leadership Brand net sales of 25.5%
- An increase in online channel net sales of approximately 32%
- Organic business net sales growth of 20.3%
- Core business net sales growth of 23.7%

GAAP consolidated operating income of $281.5 million, or 13.4% of net sales, which includes a non-cash asset impairment charge of $8.5 million and restructuring charges of $0.4 million, compared to $178.3 million, or 10.4% of net sales, for the same period last year, which included acquisition-related expenses of $2.5 million, non-cash asset impairment charges of $41.0 million, and restructuring charges of $3.3 million

Non-GAAP consolidated adjusted operating income increase of 24.2% to $334.4 million, or 15.9% of net sales, compared to $269.3 million, or 15.8% of net sales, for the same period last year

GAAP diluted EPS of $10.08, which includes a non-cash asset impairment charge of $0.30 per share, restructuring charges of $0.01 per share, and a benefit from tax reform of $0.37 per share, compared to $6.02 for the same period last year, which included acquisition-related expenses of $0.10 per share, non-cash asset impairment charges of $1.44 per share, and restructuring charges of $0.12 per share

Non-GAAP adjusted diluted EPS increase of 25.3% to $11.65, compared to $9.30 for the same period last year

Net cash provided by operating activities growth of 15.8% to $314.1 million, compared to $271.3 million for the same period last year

Free cash flow of $215.4 million, which includes a one-time, up-front license fee payment of $72.5 million to extend the license of Revlon’s trademark for hair care appliances and tools, royalty-free for the next 100 years, compared to $253.5 million for the same period last year

Repurchased 960,829 shares of common stock in the open market during the fiscal year for $191.6 million, at an average price of $199.42 per share

Julien R. Mininberg, Chief Executive Officer, stated: “Our fourth quarter results cap off an extraordinary year for Helen of Troy and an outstanding second year of our Phase II Transformation. I am very proud of the agility our organization demonstrated as we worked together with even more passion to address COVID-19’s unprecedented challenges to all aspects of the business. These efforts drove us past the $2 billion sales milestone, grew our market share for several key brands, and delivered outstanding operating cash flow, adjusted operating income, and adjusted EPS growth in fiscal 2021. During the year, our Leadership Brands once again led the way, now making up more than 81% of our sales and online sales grew to now represent 26% of total sales. Our strategic focus on international continued to bear fruit. The diversified nature of our portfolio provided consistency, with some categories benefiting from changed consumer behavior and some of our categories posting another year of strong growth based on the timeless power of consumer-centric innovation and outstanding execution. We were not shy about using this strength to further invest in projects intended to power our value creation flywheel, such as new product innovations for fiscal 2022 and beyond, IT, Direct-to-Consumer, expanded production and distribution capacity, and investments in much healthier inventory levels.”

“As we look to fiscal 2022, our all-weather portfolio of Leadership Brands is well suited to continue serving consumers. As COVID-19 lingers it favors our health-related brands. Other brands such as Hydro Flask, Drybar, Revlon, and HOT Tools are expected to benefit further as the post-pandemic landscape takes shape, and OXO is positioned to succeed in most environments. We have taken steps to address the uncertainties from the continued path of COVID-19 and emerging inflationary environment. We are working with our supply chain partners and have implemented cost mitigation measures to help offset expected inflation and will make pricing decisions to further address the situation as it evolves. We believe these actions will help us deliver on our Phase II average annual growth targets from our new elevated base and that adjusted EPS growth in fiscal 2022 is achievable. Our balance sheet has never been stronger, and we have ample liquidity and operational capability to fuel growth with a combination of organic expansion and acquisition. We believe our key strategic initiatives position us well to create significant additional shareholder value over the course of the remaining three years of Phase II.”

	Three Months Ended Last Day of February,
*(in thousands)*	Housewares			Health & Home			Beauty			Total
Fiscal 2020 sales revenue, net	$	144,948		$	185,854		$	111,563		$	442,365
Organic business (1)	17,113			40,648			(3,836)			53,925
Impact of foreign currency	402			2,121			195			2,718
Acquisition (2)	—			—			10,367			10,367
Change in sales revenue, net	17,515			42,769			6,726			67,010
Fiscal 2021 sales revenue, net	$	162,463		$	228,623		$	118,289		$	509,375

Total net sales revenue growth (decline)	12.1		%	23.0		%	6.0		%	15.1		%
Organic business	11.8		%	21.9		%	(3.4)		%	12.2		%
Impact of foreign currency	0.3		%	1.1		%	0.2		%	0.6		%
Acquisition	—		%	—		%	9.3		%	2.3		%

Operating margin (GAAP)
Fiscal 2021	10.0		%	(0.7)		%	8.5		%	4.8		%
Fiscal 2020	9.6		%	8.8		%	(29.6)		%	(0.6)		%
Adjusted operating margin (non-GAAP)
Fiscal 2021	11.7		%	0.7		%	18.9		%	8.4		%
Fiscal 2020	11.8		%	11.2		%	14.4		%	12.2		%

Consistent with its strategy of focusing on its Leadership Brands, the Company committed to a plan to divest certain assets within its global mass channel personal care business (“Personal Care”). The assets to be divested include intangible assets, inventory, net trade receivables and fixed assets related to the Company’s mass channel liquids, powder and aerosol products under brands such as Pert, Brut, Sure and Infusium. The Company entered into exclusive negotiations with a selected bidder at the end of February and have largely agreed to the broader terms. The Company is currently working through the detailed negotiation of the various agreements and complexities needed to complete the transaction and hopes to have more to announce very soon. The Company defines Core as strategic business that it expects to be an ongoing part of its operations, and Non-Core as business or assets (including assets held for sale) that it expects to divest within a year of its designation as Non-Core.

	Three Months Ended Last Day of February,
*(in thousands)*	Housewares			Health & Home			Beauty			Total
Fiscal 2020 sales revenue, net	$	144,948		$	185,854		$	111,563		$	442,365
Core business (3)	17,515			42,769			11,534			71,818
Non-Core business (Personal Care) (3)	—			—			(4,808)			(4,808)
Change in sales revenue, net	17,515			42,769			6,726			67,010
Fiscal 2021 sales revenue, net	$	162,463		$	228,623		$	118,289		$	509,375

Total net sales revenue growth (decline)	12.1		%	23.0		%	6.0		%	15.1		%
Core business	12.1		%	23.0		%	10.3		%	16.2		%
Non-Core business (Personal Care)	—		%	—		%	(4.3)		%	(1.1)		%

Consolidated Results – Fourth Quarter Fiscal 2021 Compared to Fourth Quarter Fiscal 2020

Consolidated net sales revenue increased $67.0 million, or 15.1% to $509.4 million compared to $442.4 million. The growth was driven by an Organic business increase of $53.9 million, or 12.2%, primarily reflecting growth in online, international, and brick and mortar channel sales. The Drybar Products acquisition also contributed $10.4 million of incremental net sales revenue for the eight week period prior to the first anniversary of the acquisition. These factors were partially offset by the adverse impact from February Winter Storm Uri which prevented the Company from shipping approximately $15 million of orders before the end of the quarter, COVID-19 related store traffic declines at certain retail customers and a decline in Non-Core business.

Consolidated gross profit margin increased 1.7 percentage points to 45.2%, compared to 43.5%. The increase was primarily due to a more favorable channel mix within the Housewares segment, a more favorable product mix within the Organic Beauty business and Health & Home segment, and the favorable impact of the Drybar Products acquisition. These factors were partially offset by an unfavorable product mix within the Housewares segment and higher inbound freight expense.

Consolidated selling, general and administrative expense (“SG&A”) ratio increased 4.3 percentage points to 38.7%, compared to 34.4%. The increase was primarily due to higher marketing and new product development expense, increased freight and distribution expense, and higher legal, patent defense and other professional fees. These factors were partially offset by favorable operating leverage, reduced royalty expense as a result of the extension of the Revlon trademark license, lower amortization expense, and travel expense reductions due to COVID-19.

Consolidated operating income was $24.5 million, or 4.8% of net sales revenue, compared to an operating loss of $2.7 million, or 0.6% of net sales revenue. The increase in consolidated operating margin was primarily due to a higher gross profit margin and the comparative impact of lower non-cash asset impairment charges year-over-year. These factors were partially offset by an increase in the SG&A ratio.

Income tax benefit as a percentage of income before tax was 2.7%, compared to income tax benefit as a percentage of loss before tax of 48.1%. The year-over-year change was primarily due to the comparative impact of tax benefits recognized on impairment charges recorded in both periods.

Net Income was $22.2 million, or $0.90 per diluted share, compared to a net loss of $3.2 million, or $0.13 per diluted share. Diluted EPS improved primarily due to higher operating income in the Beauty segment, which includes the favorable comparative impact of lower after-tax non-cash asset impairment charges, restructuring charges and acquisition-related expenses year-over-year, higher operating income in the Housewares segment, and the favorable impact of lower weighted average diluted shares outstanding. These factors were partially offset by an adverse impact of approximately $0.20 per diluted share from Winter Storm Uri, reduced operating income in the Health & Home segment and a lower income tax benefit.

Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) decreased 16.8% to $48.6 million compared to $58.4 million.

On an adjusted basis for the fourth quarters of fiscal 2021 and 2020, excluding acquisition-related expenses, non-cash asset impairment charges, restructuring charges, amortization of intangible assets, and non-cash share-based compensation, as applicable:

Adjusted operating income decreased $11.1 million, or 20.5%, to $42.9 million, or 8.4% of net sales revenue, compared to $53.9 million, or 12.2% of net sales revenue. The 3.8 percentage point decrease in adjusted operating margin primarily reflects an unfavorable product mix within the Housewares segment, higher marketing and new product development expense, higher inbound and outbound freight and distribution expense, and higher legal, patent defense and other professional fees. These factors were partially offset by favorable operating leverage, a more favorable product mix within the Organic Beauty business and Health & Home segment, favorable channel mix within the Housewares segment, and travel expense reductions due to COVID-19.

Adjusted income decreased $9.1 million, or 19.0%, to $38.8 million, compared to $47.8 million. Adjusted diluted EPS decreased 16.5% to $1.57, compared to $1.88. The decrease in adjusted diluted EPS was primarily due to an adverse impact of approximately $0.20 per diluted share from Winter Storm Uri and reduced operating income in the Health & Home segment. These factors were partially offset by higher operating income in the Beauty and Housewares segments, and the favorable impact of lower weighted average diluted shares outstanding.

Segment Results – Fourth Quarter Fiscal 2021 Compared to Fourth Quarter Fiscal 2020

Housewares net sales revenue increased $17.5 million, or 12.1%, to $162.5 million, compared to $144.9 million. The increase was driven by an Organic business increase of $17.1 million, or 11.8%, primarily due to higher demand for OXO brand products as COVID-19 continued to keep consumers at home cooking, baking and organizing, which resulted in increases in online, brick and mortar, and international sales. These factors were partially offset by an adverse impact from Winter Storm Uri, the COVID-19 related impact of reduced store traffic at certain retail brick and mortar stores, increased competitive activity and strong new product releases in the prior year period. Operating income increased 16.0% to $16.2 million, or 10.0% of segment net sales revenue, compared to $14.0 million, or 9.6% of segment net sales revenue. The 0.4 percentage point increase was primarily due to favorable operating leverage, a more favorable channel mix, lower marketing expenses, and travel expense reductions due to COVID-19. These factors were partially offset by a less favorable product mix, higher inbound and outbound freight and distribution expense, and higher annual incentive compensation. Adjusted operating income increased 10.7% to $19.0 million, or 11.7% of segment net sales revenue, compared to $17.1 million, or 11.8% of segment net sales revenue.

Health & Home net sales revenue increased $42.8 million, or 23.0%, to $228.6 million, compared to $185.9 million. The increase was driven by an Organic business increase of $40.6 million, or 21.9%, primarily due to continued strong consumer demand for healthcare and healthy living products in domestic and international markets, primarily in thermometry and air purification, in both brick and mortar and online channels, mainly attributable to COVID-19. These factors were partially offset by declines in non-strategic product categories, a far below average cough/cold/flu season due to social distancing and remote schooling related to COVID-19, and an adverse impact from Winter Storm Uri on end-of-quarter shipments. Operating loss was $1.7 million, or 0.7% of segment net sales revenue, compared to operating income of $16.3 million, or 8.8% of segment net sales revenue. The 9.5 percentage point decrease in segment operating margin was primarily due to increased marketing and new product development expense, higher inbound freight expense, higher distribution costs, higher annual incentive compensation, and increased legal and other professional fees. These factors were partially offset by favorable operating leverage and a more favorable product mix. Adjusted operating income decreased 92.6% to $1.5 million, or 0.7% of segment net sales revenue, compared to $20.8 million, or 11.2% of segment net sales revenue in the same period last year.

Beauty net sales revenue increased $6.7 million, or 6.0%, to $118.3 million, compared to $111.6 million. The increase was driven by the incremental net sales revenue contribution from Drybar Products of $10.4 million, or 9.3% growth, for the eight week period prior to the first anniversary of the acquisition. Sales for the five week period subsequent to the acquisition anniversary date are included in Organic business sales. These factors were partially offset by an Organic business decrease of $3.8 million, or 3.4% due to a decline in Personal Care and an adverse impact from Winter Storm Uri on end-of-quarter shipments. Operating income was $10.0 million, or 8.5% of segment net sales revenue compared to an operating loss of $33.0 million, or 29.6% of segment net sales revenue. The 38.1 percentage point increase in operating margin reflects the favorable comparative impact of lower non-cash asset impairment charges, lower restructuring charges and lower acquisition-related expenses year-over-year. The increase in operating margin also reflects a more favorable product mix, reduced royalty expense as a result of the extension of the Revlon trademark license, lower amortization expense, lower bad debt expense, and travel expense reductions due to COVID-19. These factors were partially offset by increased marketing expense, increased inbound and outbound freight expense, higher personnel expense related to the acquisition of Drybar Products, and higher legal and other professional fees. Adjusted operating income increased 39.6% to $22.4 million, or 18.9% of segment net sales revenue, compared to $16.0 million, or 14.4% of segment net sales revenue.

Balance Sheet and Cash Flow Highlights – Fiscal 2021 Compared to Fiscal 2020

Cash and cash equivalents totaled $45.1 million, compared to $24.5 million.

Accounts receivable turnover for fiscal 2021 was 68.6 days, compared to 67.0 days for the same period last year.

Inventory was $481.6 million, compared to $256.3 million. Inventory turnover for fiscal 2021 was 3.2 times, compared to 3.0 times for the same period last year.

Total short- and long-term debt was $343.6 million, compared to $339.3 million.

Net cash provided by operating activities for fiscal 2021 was $314.1 million, compared to $271.3 million.

Fiscal 2022 Business Update

Due to the high level of business uncertainty related to the unpredictable path of the evolving COVID-19 pandemic, ongoing disruption in global supply chains, and the volatility in the cost and availability of commodities, freight and other resources, the Company is not providing an Outlook for fiscal 2022 at this time. The extent of the impact of COVID-19 on the Company’s business and financial results will depend largely on future developments that are impossible to predict at this juncture and outside the Company’s control, including the duration of the spread of the COVID-19 outbreak, the availability, adoption and effectiveness of the COVID-19 vaccine, the impact on capital and financial markets and the related impact on consumer confidence and spending. Additionally, surges in demand for certain products and shifts in shopping patterns related to COVID-19, as well as other factors, have strained the global freight network, resulting in higher costs, less capacity, and longer lead times across nearly all industries. With continued increases in demand and limited supply for containers, the market rates for inbound freight have increased several fold compared to calendar year 2020 averages. In order to adjust to the difficult and uncertain environment, the Company has implemented a number of mitigation and cost reduction measures that will remain in place until there is greater certainty and less variability. While we have not yet made all our pricing decisions, price increases are being considered, along with our other cost mitigation and reduction strategies.

Conference Call and Webcast

The Company will conduct a teleconference in conjunction with today’s earnings release. The teleconference begins at 9:00 a.m. Eastern Time today, Wednesday, April 28, 2021. Investors and analysts interested in participating in the call are invited to dial (877) 407-3982 approximately ten minutes prior to the start of the call. The conference call will also be webcast live at: http://investor.helenoftroy.com. A telephone replay of this call will be available at 12:00 p.m. Eastern Time on April 28, 2021 until 11:59 p.m. Eastern Time on May 5, 2021 and can be accessed by dialing (844) 512-2921 and entering replay pin number 13718414. A replay of the webcast will remain available on the website for one year.

Non-GAAP Financial Measures

The Company reports and discusses its operating results using financial measures consistent with accounting principles generally accepted in the United States of America (“GAAP”). To supplement its presentation, the Company discloses certain financial measures that may be considered non-GAAP such as Adjusted Operating Income, Adjusted Operating Margin, Adjusted Income, Adjusted Diluted Earnings per Share (“EPS”), Core and Non-Core Adjusted Diluted EPS, EBITDA, Adjusted EBITDA, and Free Cash Flow, which are presented in accompanying tables to this press release along with a reconciliation of these financial measures to their corresponding GAAP-based measures presented in the Company’s consolidated statements of income and cash flows. For additional information see Note 10 to the accompanying tables to this press release.

About Helen of Troy Limited

Helen of Troy Limited (NASDAQ: HELE) is a leading global consumer products company offering creative products and solutions for its customers through a diversified portfolio of well-recognized and widely-trusted brands, including OXO, Hydro Flask, Vicks, Braun, Honeywell, PUR, Hot Tools and Drybar. We sometimes refer to these brands as our Leadership Brands. All trademarks herein belong to Helen of Troy Limited (or its subsidiaries) and/or are used under license from their respective licensors.

For more information about Helen of Troy, please visithttp://investor.helenoftroy.com/

Forward-Looking Statements

Certain written and oral statements made by the Company and subsidiaries of the Company may constitute “forward-looking statements” as defined under the Private Securities Litigation Reform Act of 1995. This includes statements made in this press release. Generally, the words “anticipates”, “believes”, “expects”, “plans”, “may”, “will”, “should”, “seeks”, “estimates”, “project”, “predict”, “potential”, “continue”, “intends”, and other similar words identify forward-looking statements. All statements that address operating results, events or developments that the Company expects or anticipates will occur in the future, including statements related to sales, earnings per share results, and statements expressing general expectations about future operating results, are forward-looking statements and are based upon its current expectations and various assumptions. The Company believes there is a reasonable basis for these expectations and assumptions, but there can be no assurance that the Company will realize these expectations or that these assumptions will prove correct. Forward-looking statements are subject to risks that could cause them to differ materially from actual results. Accordingly, the Company cautions readers not to place undue reliance on forward-looking statements. The forward-looking statements contained in this press release should be read in conjunction with, and are subject to and qualified by, the risks described in the Company’s Form 10-K for the year ended February 28, 2021, and in the Company’s other filings with the SEC. Investors are urged to refer to the risk factors referred to above for a description of these risks. Such risks include, among others, the Company’s ability to successfully manage the demand, supply, and operational challenges associated with the actual or perceived effects of COVID-19 and any similar future public health crisis, pandemic or epidemic, the Company’s ability to deliver products to its customers in a timely manner and according to their fulfillment standards, actions taken by large customers that may adversely affect the Company’s gross profit and operating results, the Company’s dependence on the strength of retail economies and vulnerabilities to any prolonged economic downturn, including from the effects of COVID-19, the Company’s dependence on sales to several large customers and the risks associated with any loss of, or substantial decline in, sales to top customers, expectations regarding recent acquisitions and any future acquisitions or divestitures, including the Company’s ability to realize related synergies along with its ability to effectively integrate acquired businesses or disaggregate divested businesses, the Company’s reliance on its Chief Executive Officer and a limited number of other key senior officers to operate its business, obsolescence or interruptions in the operation of the Company’s central global Enterprise Resource Planning (“ERP”) systems and other peripheral information systems, occurrence of cyber incidents or failure by the Company or its third-party service providers to maintain cybersecurity and the integrity of confidential internal or customer data, the Company’s dependence on third-party manufacturers, most of which are located in the Far East, and any inability to obtain products from such manufacturers, risks associated with weather conditions, the duration and severity of the cold and flu season and other related factors, the geographic concentration and peak season capacity of certain U.S. distribution facilities which increase its risk to disruptions that could affect the Company’s ability to deliver products in a timely manner, risks associated with the use of licensed trademarks from or to third parties, the Company’s ability to develop and introduce a continuing stream of innovative new products to meet changing consumer preferences, the risks associated with trade barriers, exchange controls, expropriations, and other risks associated with domestic and foreign operations, the risks associated with significant changes in regulations, interpretations or product certification requirements, the risks associated with global legal developments regarding privacy and data security that could result in changes to its business practices, penalties, increased cost of operations, or otherwise harm the business, the risks associated with accounting for tax positions and the resolution of tax disputes, the risks of potential changes in laws and regulations, including environmental, health and safety and tax laws, and the costs and complexities of compliance with such laws, the Company’s ability to continue to avoid classification as a Controlled Foreign Corporation, the risks associated with legislation enacted in Bermuda and Barbados in response to the European Union’s review of harmful tax competition, the risks of significant tariffs or other restrictions being placed on imports from China or Mexico or any retaliatory trade measures taken by China or Mexico, the risks associated with product recalls, product liability and other claims against the Company, and associated financial risks including but not limited to, significant impairment of the Company’s goodwill, indefinite-lived and definite-lived intangible assets or other long-lived assets, risks associated with foreign currency exchange rate fluctuations, increased costs of raw materials, energy and transportation, projections of product demand, sales and net income, which are highly subjective in nature, and from which future sales and net income could vary in a material amount, the risks to the Company’s liquidity or cost of capital which may be materially adversely affected by constraints or changes in the capital and credit markets and limitations under its financing arrangements. The Company undertakes no obligation to publicly update or revise any forward-looking statements as a result of new information, future events or otherwise.

HELEN OF TROY LIMITED AND SUBSIDIARIES Consolidated Statements of Income (Unaudited) (in thousands, except per share data)

	Three Months Ended Last Day of February,
	2021				2020
Sales revenue, net	$	509,375	100.0	%	$	442,365	100.0	%
Cost of goods sold	279,037		54.8	%	249,750		56.5	%
Gross profit	230,338		45.2	%	192,615		43.5	%
Selling, general and administrative expense (“SG&A”)	197,366		38.7	%	152,108		34.4	%
Asset impairment charges	8,452		1.7	%	41,000		9.3	%
Restructuring charges	(5)		—	%	2,252		0.5	%
Operating income (loss)	24,525		4.8	%	(2,745)		(0.6)	%
Non-operating income, net	119		—	%	81		—	%
Interest expense	3,049		0.6	%	3,414		0.8	%
Income (loss) before income tax	21,595		4.2	%	(6,078)		(1.4)	%
Income tax benefit	(577)		(0.1)	%	(2,923)		(0.7)	%
Net income (loss)	$	22,172	4.4	%	$	(3,155)	(0.7)	%

Diluted earnings (loss) per share (“EPS”)	$	0.90			$	(0.13)

Weighted average shares of common stock used in computing diluted EPS	24,737				25,175

	Fiscal Year Ended Last Day of February,
	2021				2020
Sales revenue, net	$	2,098,799	100.0	%	$	1,707,432	100.0	%
Cost of goods sold	1,171,497		55.8	%	972,966		57.0	%
Gross profit	927,302		44.2	%	734,466		43.0	%
SG&A	637,012		30.4	%	511,902		30.0	%
Asset impairment charges	8,452		0.4	%	41,000		2.4	%
Restructuring charges	350		—	%	3,313		0.2	%
Operating income	281,488		13.4	%	178,251		10.4	%
Non-operating income, net	559		—	%	394		—	%
Interest expense	12,617		0.6	%	12,705		0.7	%
Income before income tax	269,430		12.8	%	165,940		9.7	%
Income tax expense	15,484		0.7	%	13,607		0.8	%
Net income	$	253,946	12.1	%	$	152,333	8.9	%

Diluted EPS	$	10.08			$	6.02

Weighted average shares of common stock used in computing diluted EPS	25,196				25,322

Consolidated Statements of Income and Reconciliation of Non-GAAP Financial Measures – Adjusted Operating Income, Adjusted Income and Adjusted Diluted EPS (2) (10) (Unaudited) (in thousands, except per share data)

	Three Months Ended February 28, 2021
	As Reported (GAAP)				Adjustments			Adjusted (Non-GAAP)
Sales revenue, net	$	509,375	100.0	%	$	—		$	509,375	100.0	%
Cost of goods sold	279,037		54.8	%	—			279,037		54.8	%
Gross profit	230,338		45.2	%	—			230,338		45.2	%
SG&A	197,366		38.7	%	(4,116)		(4)	187,486		36.8	%
					(5,764)		(5)
Asset impairment charges	8,452		1.7	%	(8,452)		(6)	—		—	%
Restructuring charges	(5)		—	%	5		(7)	—		—	%
Operating income	24,525		4.8	%	18,327			42,852		8.4	%
Non-operating income, net	119		—	%	—			119		—	%
Interest expense	3,049		0.6	%	—			3,049		0.6	%
Income before income tax	21,595		4.2	%	18,327			39,922		7.8	%
Income tax (benefit) expense	(577)		(0.1)	%	1,743			1,166		0.2	%
Net Income	$	22,172	4.4	%	$	16,584		$	38,756	7.6	%

Diluted EPS	$	0.90			$	0.67		$	1.57

Weighted average shares of common stock used in computing diluted EPS	24,737							24,737

	Three Months Ended February 29, 2020
	As Reported (GAAP)				Adjustments			Adjusted (Non-GAAP)
Sales revenue, net	$	442,365	100.0	%	$	—		$	442,365	100.0	%
Cost of goods sold	249,750		56.5	%	—			249,750		56.5	%
Gross profit	192,615		43.5	%	—			192,615		43.5	%
SG&A	152,108		34.4	%	(8,142)		(4)	138,709		31.4	%
					(4,186)		(5)
					(1,071)		(8)
Asset impairment charges	41,000		9.3	%	(41,000)		(6)	—		—	%
Restructuring charges	2,252		0.5	%	(2,252)		(7)	—		—	%
Operating (loss) income	(2,745)		(0.6)	%	56,651			53,906		12.2	%
Non-operating income, net	81		—	%	—			81		—	%
Interest expense	3,414		0.8	%	—			3,414		0.8	%
(Loss) income before income tax	(6,078)		(1.4)	%	56,651			50,573		11.4	%
Income tax (benefit) expense	(2,923)		(0.7)	%	5,676			2,753		0.6	%
Net (loss) income	$	(3,155)	(0.7)	%	$	50,975		$	47,820	10.8	%

Diluted EPS	$	(0.13)			$	2.01		$	1.88

Weighted average shares of common stock used in computing diluted EPS	25,175							25,403

Consolidated Statements of Income and Reconciliation of Non-GAAP Financial Measures – Adjusted Operating Income, Adjusted Income and Adjusted Diluted EPS (2) (10) (Unaudited) (in thousands, except per share data)

	Fiscal Year Ended February 28, 2021
	As Reported (GAAP)				Adjustments			Adjusted (Non-GAAP)
Sales revenue, net	$	2,098,799	100.0	%	$	—		$	2,098,799	100.0	%
Cost of goods sold	1,171,497		55.8	%	—			1,171,497		55.8	%
Gross profit	927,302		44.2	%	—			927,302		44.2	%
SG&A	637,012		30.4	%	(17,643)		(4)	592,951		28.3	%
					(26,418)		(5)
Asset impairment charges	8,452		0.4	%	(8,452)		(6)	—		—	%
Restructuring charges	350		—	%	(350)		(7)	—		—	%
Operating income	281,488		13.4	%	52,863			334,351		15.9	%
Non-operating income, net	559		—	%	—			559		—	%
Interest expense	12,617		0.6	%	—			12,617		0.6	%
Income before income tax	269,430		12.8	%	52,863			322,293		15.4	%
Income tax expense	15,484		0.7	%	13,159			28,643		1.4	%
Net Income	$	253,946	12.1	%	$	39,704		$	293,650	14.0	%

Diluted EPS	$	10.08			$	1.58		$	11.65

Weighted average shares of common stock used in computing diluted EPS	25,196							25,196

	Fiscal Year Ended February 29, 2020
	As Reported (GAAP)				Adjustments			Adjusted (Non-GAAP)
Sales revenue, net	$	1,707,432	100.0	%	$	—		$	1,707,432	100.0	%
Cost of goods sold	972,966		57.0	%	—			972,966		57.0	%
Gross profit	734,466		43.0	%	—			734,466		43.0	%
SG&A	511,902		30.0	%	(21,271)		(4)	465,156		27.2	%
					(22,929)		(5)
					(2,546)		(8)
Asset impairment charges	41,000		2.4	%	(41,000)		(6)	—		—	%
Restructuring charges	3,313		0.2	%	(3,313)		(7)	—		—	%
Operating income	178,251		10.4	%	91,059			269,310		15.8	%
Non-operating income, net	394		—	%	—			394		—	%
Interest expense	12,705		0.7	%	—			12,705		0.7	%
Income before income tax	165,940		9.7	%	91,059			256,999		15.1	%
Income tax expense	13,607		0.8	%	7,821			21,428		1.3	%
Net Income	$	152,333	8.9	%	$	83,238		$	235,571	13.8	%

Diluted EPS	$	6.02			$	3.29		$	9.30

Weighted average shares of common stock used in computing diluted EPS	25,322							25,322

Consolidated and Segment Net Sales Revenue (Unaudited) (in thousands)

	Three Months Ended Last Day of February,
	Housewares			Health & Home			Beauty			Total
Fiscal 2020 sales revenue, net	$	144,948		$	185,854		$	111,563		$	442,365
Organic business (1)	17,113			40,648			(3,836)			53,925
Impact of foreign currency	402			2,121			195			2,718
Acquisition (2)	—			—			10,367			10,367
Change in sales revenue, net	17,515			42,769			6,726			67,010
Fiscal 2021 sales revenue, net	$	162,463		$	228,623		$	118,289		$	509,375

Total net sales revenue growth (decline)	12.1		%	23.0		%	6.0		%	15.1		%
Organic business	11.8		%	21.9		%	(3.4)		%	12.2		%
Impact of foreign currency	0.3		%	1.1		%	0.2		%	0.6		%
Acquisition	—		%	—		%	9.3		%	2.3		%

	Fiscal Year Ended Last Day of February,
	Housewares			Health & Home			Beauty			Total
Fiscal 2020 sales revenue, net	$	640,965		$	685,397		$	381,070		$	1,707,432
Organic business (1)	85,916			202,786			57,110			345,812
Impact of foreign currency	473			2,008			(2,926)			(445)
Acquisition (2)	—			—			46,000			46,000
Change in sales revenue, net	86,389			204,794			100,184			391,367
Fiscal 2021 sales revenue, net	$	727,354		$	890,191		$	481,254		$	2,098,799

Total net sales revenue growth (decline)	13.5		%	29.9		%	26.3		%	22.9		%
Organic business	13.4		%	29.6		%	15.0		%	20.3		%
Impact of foreign currency	0.1		%	0.3		%	(0.8)		%	—		%
Acquisition	—		%	—		%	12.1		%	2.7		%

Leadership Brand and Other Net Sales Revenue (2) (Unaudited) (in thousands)

	Three Months Ended Last Day of February,
	2021		2020		$ Change		% Change
Leadership Brand sales revenue, net (9)	$	417,931	$	347,713	$	70,218	20.2	%
All other sales revenue, net	91,444		94,652		(3,208)		(3.4)	%
Total sales revenue, net	$	509,375	$	442,365	$	67,010	15.1	%

	Fiscal Year Ended Last Day of February,
	2021		2020		$ Change		% Change
Leadership Brand sales revenue, net (9)	$	1,706,545	$	1,360,059	$	346,486	25.5	%
All other sales revenue, net	392,254		347,373		44,881		12.9	%
Total sales revenue, net	$	2,098,799	$	1,707,432	$	391,367	22.9	%

Consolidated and Segment Net Sales from Core and Non-Core Business (3) (Unaudited) (in thousands)

	Three Months Ended Last Day of February,
	Housewares			Health & Home			Beauty			Total
Fiscal 2020 sales revenue, net	$	144,948		$	185,854		$	111,563		$	442,365
Core business	17,515			42,769			11,534			71,818
Non-Core business (Personal Care)	—			—			(4,808)			(4,808)
Change in sales revenue, net	17,515			42,769			6,726			67,010
Fiscal 2021 sales revenue, net	$	162,463		$	228,623		$	118,289		$	509,375

Total net sales revenue growth (decline)	12.1		%	23.0		%	6.0		%	15.1		%
Core business	12.1		%	23.0		%	10.3		%	16.2		%
Non-Core business (Personal Care)	—		%	—		%	(4.3)		%	(1.1)		%

	Fiscal Year Ended Last Day of February,
	Housewares			Health & Home			Beauty			Total
Fiscal 2020 sales revenue, net	$	640,965		$	685,397		$	381,070		$	1,707,432
Core business	86,389			204,794			114,176			405,359
Non-Core business (Personal Care)	—			—			(13,992)			(13,992)
Change in sales revenue, net	86,389			204,794			100,184			391,367
Fiscal 2021 sales revenue, net	$	727,354		$	890,191		$	481,254		$	2,098,799

Total net sales revenue growth (decline)	13.5		%	29.9		%	26.3		%	22.9		%
Core business	13.5		%	29.9		%	30.0		%	23.7		%
Non-Core business (Personal Care)	—		%	—		%	(3.7)		%	(0.8)		%

Reconciliation of Non-GAAP Financial Measures – GAAP Operating Income to Adjusted Operating Income (Non-GAAP) (10) (Unaudited) (in thousands)

	Three Months Ended February 28, 2021
	Housewares				Health & Home				Beauty (2)				Total
Operating income (loss), as reported (GAAP)	$	16,193	10.0	%	$	(1,679)	(0.7)	%	$	10,011	8.5	%	$	24,525	4.8	%
Asset impairment charges	—		—	%	—		—	%	8,452		7.1	%	8,452		1.7	%
Restructuring charges	(2)		—	%	(6)		—	%	3		—	%	(5)		—	%
Subtotal	16,191		10.0	%	(1,685)		(0.7)	%	18,466		15.6	%	32,972		6.5	%
Amortization of intangible assets	514		0.3	%	1,196		0.5	%	2,406		2.0	%	4,116		0.8	%
Non-cash share-based compensation	2,254		1.4	%	2,025		0.9	%	1,485		1.3	%	5,764		1.1	%
Adjusted operating income (non-GAAP)	$	18,959	11.7	%	$	1,536	0.7	%	$	22,357	18.9	%	$	42,852	8.4	%

	Three Months Ended February 29, 2020
	Housewares				Health & Home				Beauty (2)				Total
Operating income (loss), as reported (GAAP)	$	13,965	9.6	%	$	16,330	8.8	%	$	(33,040)	(29.6)	%	$	(2,745)	(0.6)	%
Acquisition-related expenses (8)	—		—	%	—		—	%	1,071		1.0	%	1,071		0.2	%
Asset impairment charges	—		—	%	—		—	%	41,000		36.8	%	41,000		9.3	%
Restructuring charges	1,261		0.9	%	93		0.1	%	898		0.8	%	2,252		0.5	%
Subtotal	15,226		10.5	%	16,423		8.8	%	9,929		8.9	%	41,578		9.4	%
Amortization of intangible assets	543		0.4	%	2,451		1.3	%	5,148		4.6	%	8,142		1.8	%
Non-cash share-based compensation	1,365		0.9	%	1,878		1.0	%	943		0.8	%	4,186		0.9	%
Adjusted operating income (non-GAAP)	$	17,134	11.8	%	$	20,752	11.2	%	$	16,020	14.4	%	$	53,906	12.2	%

	Fiscal Year Ended February 28, 2021
	Housewares				Health & Home				Beauty (2)				Total
Operating income, as reported (GAAP)	$	122,487	16.8	%	$	94,103	10.6	%	$	64,898	13.5	%	$	281,488	13.4	%
Asset impairment charges	—		—	%	—		—	%	8,452		1.8	%	8,452		0.4	%
Restructuring charges	249		—	%	(6)		—	%	107		—	%	350		—	%
Subtotal	122,736		16.9	%	94,097		10.6	%	73,457		15.3	%	290,290		13.8	%
Amortization of intangible assets	2,055		0.3	%	8,611		1.0	%	6,977		1.4	%	17,643		0.8	%
Non-cash share-based compensation	10,278		1.4	%	9,191		1.0	%	6,949		1.4	%	26,418		1.3	%
Adjusted operating income (non-GAAP)	$	135,069	18.6	%	$	111,899	12.6	%	$	87,383	18.2	%	$	334,351	15.9	%

	Fiscal Year Ended February 29, 2020
	Housewares				Health & Home				Beauty (2)				Total
Operating income (loss), as reported (GAAP)	$	123,135	19.2	%	$	68,166	9.9	%	$	(13,050)	(3.4)	%	$	178,251	10.4	%
Acquisition-related expenses (8)	—		—	%	—		—	%	2,546		0.7	%	2,546		0.1	%
Asset impairment charges	—		—	%	—		—	%	41,000		10.8	%	41,000		2.4	%
Restructuring charges	1,351		0.2	%	93		—	%	1,869		0.5	%	3,313		0.2	%
Subtotal	124,486		19.4	%	68,259		10.0	%	32,365		8.5	%	225,110		13.2	%
Amortization of intangible assets	2,055		0.3	%	10,539		1.5	%	8,677		2.3	%	21,271		1.2	%
Non-cash share-based compensation	7,218		1.1	%	9,717		1.4	%	5,994		1.6	%	22,929		1.3	%
Adjusted operating income (non-GAAP)	$	133,759	20.9	%	$	88,515	12.9	%	$	47,036	12.3	%	$	269,310	15.8	%

Reconciliation of Non-GAAP Financial Measures – EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) and Adjusted EBITDA (10) (Unaudited) (in thousands)

	Three Months Ended February 28, 2021
	Housewares		Health & Home		Beauty (2)		Total
Operating income (loss), as reported (GAAP)	$	16,193	$	(1,679)	$	10,011	$	24,525
Depreciation and amortization	2,590		3,122		4,011		9,723
Non-operating income, net	—		—		119		119
EBITDA (non-GAAP)	18,783		1,443		14,141		34,367
Add: Restructuring charges	(2)		(6)		3		(5)
Asset impairment charges	—		—		8,452		8,452
Non-cash share-based compensation	2,254		2,025		1,485		5,764
Adjusted EBITDA (non-GAAP)	$	21,035	$	3,462	$	24,081	$	48,578

	Three Months Ended February 29, 2020
	Housewares		Health & Home		Beauty (2)		Total
Operating income (loss), as reported (GAAP)	$	13,965	$	16,330	$	(33,040)	$	(2,745)
Depreciation and amortization	2,006		3,791		6,736		12,533
Non-operating income, net	—		—		81		81
EBITDA (non-GAAP)	15,971		20,121		(26,223)		9,869
Add: Acquisition-related expenses (8)	—		—		1,071		1,071
Restructuring charges	1,261		93		898		2,252
Asset impairment charges	—		—		41,000		41,000
Non-cash share-based compensation	1,365		1,878		943		4,186
Adjusted EBITDA (non-GAAP)	$	18,597	$	22,092	$	17,689	$	58,378

	Fiscal Year Ended February 28, 2021
	Housewares		Health & Home		Beauty (2)		Total
Operating income, as reported (GAAP)	$	122,487	$	94,103	$	64,898	$	281,488
Depreciation and amortization	9,333		15,453		12,932		37,718
Non-operating income, net	—		—		559		559
EBITDA (non-GAAP)	131,820		109,556		78,389		319,765
Add: Restructuring charges	249		(6)		107		350
Asset impairment charges	—		—		8,452		8,452
Non-cash share-based compensation	10,278		9,191		6,949		26,418
Adjusted EBITDA (non-GAAP)	$	142,347	$	118,741	$	93,897	$	354,985

	Fiscal Year Ended February 29, 2020
	Housewares		Health & Home		Beauty (2)		Total
Operating income (loss), as reported (GAAP)	$	123,135	$	68,166	$	(13,050)	$	178,251
Depreciation and amortization	7,298		16,113		13,998		37,409
Non-operating income, net	—		—		394		394
EBITDA (non-GAAP)	130,433		84,279		1,342		216,054
Add: Acquisition-related expenses (8)	—		—		2,546		2,546
Restructuring charges	1,351		93		1,869		3,313
Asset impairment charges	—		—		41,000		41,000
Non-cash share-based compensation	7,218		9,717		5,994		22,929
Adjusted EBITDA (non-GAAP)	$	139,002	$	94,089	$	52,751	$	285,842

Reconciliation of GAAP Income (Loss) and Diluted EPS to Adjusted Income and Adjusted Diluted EPS (Non-GAAP) (10) (Unaudited) (in thousands, except per share data)

	Three Months Ended February 28, 2021
	Income						Diluted EPS
	Before Tax		Tax		Net of Tax		Before Tax		Tax		Net of Tax
As reported (GAAP)	$	21,595	$	(577)	$	22,172	$	0.87	$	(0.02)	$	0.90
Asset impairment charges	8,452		1,009		7,443		0.34		0.04		0.30
Restructuring charges	(5)		—		(5)		—		—		—
Subtotal	30,042		432		29,610		1.21		0.02		1.20
Amortization of intangible assets	4,116		214		3,902		0.17		0.01		0.16
Non-cash share-based compensation	5,764		520		5,244		0.23		0.02		0.21
Adjusted (non-GAAP)	$	39,922	$	1,166	$	38,756	$	1.61	$	0.05	$	1.57

Weighted average shares of common stock used in computing diluted EPS											24,737

	Three Months Ended February 29, 2020
	(Loss) Income						Diluted EPS
	Before Tax		Tax		Net of Tax		Before Tax		Tax		Net of Tax
As reported (GAAP)	$	(6,078)	$	(2,923)	$	(3,155)	$	(0.24)	$	(0.12)	$	(0.13)
Acquisition-related expenses (8)	1,071		16		1,055		0.04		—		0.04
Asset impairment charges	41,000		4,574		36,426		1.61		0.18		1.43
Restructuring charges	2,252		93		2,159		0.09		—		0.08
Subtotal	38,245		1,760		36,485		1.51		0.07		1.44
Amortization of intangible assets	8,142		624		7,518		0.32		0.02		0.30
Non-cash share-based compensation	4,186		369		3,817		0.16		0.01		0.15
Adjusted (non-GAAP)	$	50,573	$	2,753	$	47,820	$	1.99	$	0.11	$	1.88

Weighted average shares of common stock used in computing diluted EPS											25,403

	Fiscal Year Ended February 28, 2021
	Income						Diluted EPS
	Before Tax		Tax		Net of Tax		Before Tax		Tax		Net of Tax
As reported (GAAP)	$	269,430	$	15,484	$	253,946	$	10.69	$	0.61	$	10.08
Asset impairment charges	8,452		1,009		7,443		0.34		0.04		0.30
Restructuring charges	350		2		348		0.01		—		0.01
Tax reform	—		9,357		(9,357)		—		0.37		(0.37)
Subtotal	278,232		25,852		252,380		11.04		1.03		10.02
Amortization of intangible assets	17,643		865		16,778		0.70		0.03		0.67
Non-cash share-based compensation	26,418		1,926		24,492		1.05		0.08		0.97
Adjusted (non-GAAP)	$	322,293	$	28,643	$	293,650	$	12.79	$	1.14	$	11.65

Weighted average shares of common stock used in computing diluted EPS											25,196

	Fiscal Year Ended February 29, 2020
	Income						Diluted EPS
	Before Tax		Tax		Net of Tax		Before Tax		Tax		Net of Tax
As reported (GAAP)	$	165,940	$	13,607	$	152,333	$	6.55	$	0.54	$	6.02
Acquisition-related expenses (8)	2,546		38		2,508		0.10		—		0.10
Asset impairment charges	41,000		4,574		36,426		1.62		0.18		1.44
Restructuring charges	3,313		161		3,152		0.13		0.01		0.12
Subtotal	212,799		18,380		194,419		8.40		0.73		7.68
Amortization of intangible assets	21,271		1,245		20,026		0.84		0.05		0.79
Non-cash share-based compensation	22,929		1,803		21,126		0.91		0.07		0.83
Adjusted (non-GAAP)	$	256,999	$	21,428	$	235,571	$	10.15	$	0.85	$	9.30

Weighted average shares of common stock used in computing diluted EPS											25,322

Consolidated Core and Non-Core Net Sales and Reconciliation of Core and Non-Core Diluted EPS to Core and Non-Core Adjusted Diluted EPS (Non-GAAP) (3) (10) (Unaudited) (in thousands, except per share data)

	Three Months Ended Last Day of February,
	2021		2020		$ Change		% Change
Sales revenue, net
Core	$	493,458	$	421,640	$	71,818	17.0	%
Non-Core	15,917		20,725		(4,808)		(23.2)	%
Total	$	509,375	$	442,365	$	67,010	15.1	%

	Three Months Ended Last Day of February,
	2021		2020		$ Change		% Change
Adjusted Diluted EPS (non-GAAP)
Core	$	1.42	$	1.73	$	(0.31)	(17.9)	%
Non-Core	0.15		0.15		—		—	%
Total	$	1.57	$	1.88	$	(0.31)	(16.5)	%

	Three Months Ended Last Day of February,
Core Business:	2021		2020
Diluted EPS, as reported	$	1.05	$	1.31
Acquisition-related expenses, net of tax	—		0.04
Restructuring charges, net of tax	—		0.08
Subtotal	1.05		1.43
Amortization of intangible assets, net of tax	0.16		0.15
Non-cash share-based compensation, net of tax	0.21		0.15
Adjusted Diluted EPS (non-GAAP)	$	1.42	$	1.73


	Three Months Ended Last Day of February,
Non-Core Business:	2021		2020
Diluted EPS, as reported	$	(0.15)	$	(1.44)
Asset impairment charges, net of tax	0.30		1.43
Subtotal	0.15		(0.01)
Amortization of intangible assets, net of tax	—		0.15
Adjusted Diluted EPS (non-GAAP)	$	0.15	$	0.15

Diluted EPS, as reported (GAAP)	$	0.90	$	(0.13)

Consolidated Core and Non-Core Net Sales and Reconciliation of Core and Non-Core Diluted EPS to Core and Non-Core Adjusted Diluted EPS (Non-GAAP) (3) (10) (Unaudited) (in thousands, except per share data)

	Fiscal Years Ended Last Day of February,
	2021		2020		$ Change		% Change
Sales revenue, net
Core	$	2,020,453	$	1,615,094	$	405,359	25.1	%
Non-Core	78,346		92,338		(13,992)		(15.2)	%
Total	$	2,098,799	$	1,707,432	$	391,367	22.9	%

	Fiscal Years Ended Last Day of February,
	2021		2020		$ Change		% Change
Adjusted Diluted EPS (non-GAAP)
Core	$	11.03	$	8.72	$	2.31	26.5	%
Non-Core	0.62		0.58		0.04		6.9	%
Total	$	11.65	$	9.30	$	2.35	25.3	%

	Fiscal Years Ended Last Day of February,
Core Business:	2021		2020
Diluted EPS, as reported	$	9.76	$	7.16
Acquisition-related expenses, net of tax	—		0.10
Restructuring charges, net of tax	0.01		0.11
Tax Reform	(0.37)		—
Subtotal	9.40		7.37
Amortization of intangible assets, net of tax	0.67		0.53
Non-cash share-based compensation, net of tax	0.97		0.82
Adjusted Diluted EPS (non-GAAP)	$	11.03	$	8.72


	Fiscal Years Ended Last Day of February,
Non-Core Business:	2021		2020
Diluted EPS, as reported	$	0.32	$	(1.14)
Asset impairment charges, net of tax	0.30		1.44
Restructuring charges, net of tax	—		0.01
Subtotal	0.62		0.31
Amortization of intangible assets, net of tax	—		0.26
Non-cash share-based compensation, net of tax	—		0.01
Adjusted Diluted EPS (non-GAAP)	$	0.62	$	0.58

Diluted EPS, as reported (GAAP)	$	10.08	$	6.02

Selected Consolidated Balance Sheet, Cash Flow and Liquidity Information (Unaudited) (in thousands)

	Last Day of February,
	2021		2020
Balance Sheet:
Cash and cash equivalents	$	45,120	$	24,467
Receivables, net	382,449		348,023
Inventory, net	481,611		256,311
Assets held for sale	39,867		44,806
Total assets, current	971,937		682,836
Total assets	2,263,488		1,903,883
Total liabilities, current	614,892		338,896
Total long-term liabilities	409,249		403,264
Total debt	343,630		339,305
Stockholders’ equity	1,239,347		1,161,723
Liquidity:
Working capital	$	357,045	$	343,940

	Fiscal Years Ended Last Day of February,
	2021		2020
Cash Flow:
Depreciation and amortization	$	37,718	$	37,409
Net cash provided by operating activities	314,106		271,293
Capital and intangible asset expenditures	98,668		17,759
Net debt proceeds	7,100		16,900
Payments for repurchases of common stock	203,294		10,169

Reconciliation of GAAP Net Cash Provided by Operating Activities to Free Cash Flow (Non-GAAP) (10) (Unaudited) (in thousands)

	Fiscal Years Ended Last Day of February,
	2021		2020
Net cash provided by operating activities (GAAP)	$	314,106	$	271,293
Less: Capital and intangible asset expenditures	(98,668)		(17,759)
Free cash flow (non-GAAP)	$	215,438	$	253,534

HELEN OF TROY LIMITED AND SUBSIDIARIES

Notes to Press Release

Organic business refers to net sales revenue associated with product lines or brands after the first twelve months from the date the product line or brand is acquired, excluding the impact that foreign currency remeasurement had on reported net sales revenue. Net sales revenue from internally developed brands or product lines is considered Organic business activity.
On January 23, 2020, we completed the acquisition of Drybar Products. As such, fiscal 2020 includes approximately five weeks of operating results from Drybar Products and fiscal 2021 includes a full year of operating results. Drybar Products sales prior to the first annual anniversary of the acquisition are reported in Acquisition. Sales from Drybar Products subsequent to the first annual anniversary of the acquisition are reported in Organic business.
The Company defines Core business as strategic business that it expects to be an ongoing part of its operations, and Non-Core business as business or assets (including assets held for sale) that it expects to divest within a year of its designation as Non-Core.
Amortization of intangible assets.
Non-cash share-based compensation.
Non-cash asset impairment charges related to goodwill and intangible assets. The impairment charges were related to assets of the Personal Care business classified as held for sale within the Beauty segment.
Charges incurred in conjunction with the Company’s restructuring plan (Project Refuel).
Acquisition-related expense associated with the definitive agreement to acquire Drybar Products LLC are included in SG&A for the three- and twelve-month periods ended February 29, 2020.
Leadership Brand net sales consists of revenue from the OXO, Honeywell, Braun, PUR, Hydro Flask, Vicks, Hot Tools and Drybar brands.
This press release contains non-GAAP financial measures. Adjusted Operating Income, Adjusted Operating Margin, Adjusted Income, Adjusted Diluted EPS, Core and Non-Core Adjusted Diluted EPS, EBITDA, Adjusted EBITDA, and Free Cash Flow (“Non-GAAP Financial Measures”) that are discussed in the accompanying press release or in the preceding tables may be considered non-GAAP financial information as contemplated by SEC Regulation G, Rule 100. Accordingly, the Company is providing the preceding tables that reconcile these measures to their corresponding GAAP-based measures. The Company believes that these non-GAAP measures provide useful information to management and investors regarding financial and business trends relating to its financial condition and results of operations. The Company believes that these non-GAAP financial measures, in combination with the Company’s financial results calculated in accordance with GAAP, provide investors with additional perspective regarding the impact of certain charges and benefits on applicable income, margin and earnings per share measures. The Company also believes that these non-GAAP measures facilitate a more direct comparison of the Company’s performance with its competitors. The Company further believes that including the excluded charges and benefits would not accurately reflect the underlying performance of the Company’s operations for the period in which the charges and benefits are incurred, even though such charges and benefits may be incurred and reflected in the Company’s GAAP financial results in the near future. The material limitation associated with the use of the non-GAAP measures is that the non-GAAP measures do not reflect the full economic impact of the Company’s activities. These non-GAAP measures are not prepared in accordance with GAAP, are not an alternative to GAAP financial information, and may be calculated differently than non-GAAP financial information disclosed by other companies. Accordingly, undue reliance should not be placed on non-GAAP information.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210428005265/en/

Investor Contact:

Helen of Troy Limited

Anne Rakunas, Director, External Communications

(915) 225-4841

ICR, Inc.

Allison Malkin, Partner

(203) 682-8200

KEYWORDS: United States North America Texas

INDUSTRY KEYWORDS: Retail Other Consumer Consumer Other Retail Home Goods Specialty

MEDIA:

April 28, 2021 6:48 am

Real Matters Reports Second Quarter Financial Results and Intention to Renew its Normal Course Issuer Bid

Real Matters Reports Second Quarter Financial Results and Intention to Renew its Normal Course Issuer Bid

(all amounts are expressed in millions of U.S. dollars, excluding per share amounts and unless otherwise stated)

TORONTO–(BUSINESS WIRE)–
Real Matters Inc. (TSX: REAL) (“Real Matters” or the “Company”), a leading network management services platform for the mortgage and insurance industries, today announced its financial results for the second quarter ended March 31, 2021.

“We were very pleased with our performance in the second quarter; we delivered strong financial results and launched our first Tier 1 lender in U.S. Title, marking the achievement of a significant milestone in the execution of our long-term growth strategy. Consolidated Net Revenue⁽¹⁾ increased 29.8% to $46.7 million and Adjusted EBITDA⁽¹⁾ increased 30.2% to $19.0 million from the second quarter of fiscal 2020, principally driven by higher volumes and margin expansion in our U.S. Title segment,” said Real Matters Chief Executive Officer Brian Lang. “The U.S. mortgage market continued to demonstrate strong year-over-year growth in the second quarter and both our U.S. businesses outperformed the market from market share growth and new client additions. Our centralized U.S. Title revenues were up 78.4% compared with an estimated 71.1% increase in the refinance origination market, while U.S. Appraisal origination revenues were up 12.0% compared with an estimated 10.7% increase in the addressable market.”

“Looking ahead, our principal focus continues to be market share growth and adding new clients. Given our performance track record and the breadth of our U.S. lender client base, we are confident in our ability to continue driving organic growth over the long-term with a view of achieving our Fiscal 2025 targets,” added Lang.

Q2 2021 Key Performance Indicators (year-over-year)	U.S. Appraisal	U.S. Title	Consolidated
Revenues	$76.3 million	$40.1 million	$128.8 million
Revenue Growth	7.0%	30.0%	17.5%
Net Revenue^(A) Growth	-4.4%	64.1%	29.8%
Adjusted EBITDA^(A) Margin	55.5%	46.1%	40.7%

Q2 2021 Highlights

Launched first Tier 1 lender in U.S. Title and three other new lenders
Launched two new lenders in U.S. Appraisal
Purchased 594 thousand shares under our normal course issuer bid at a cost of $8.0 million

Fiscal 2021 Year to Date Highlights

Launched six new lenders in U.S. Title (including first Tier 1 and one Tier 2 lender)
Launched three lenders in U.S. Appraisal (including one Tier 2 lender)
Purchased 1.8 million shares under our normal course issuer bid at a cost of $26.9 million

Financial and Operational Summary

(millions of dollars)		Three months ended March 31
	2021		Margin	2020		Margin	$ Change		% Change

Revenues
U.S. Appraisal	$	76.3		$	71.3		$	5.0	7.0%
U.S. Title		40.1			30.8			9.3	30.0%
Canada		12.4			7.5			4.9	65.6%
Consolidated revenues	$	128.8		$	109.6		$	19.2	17.5%

Net Revenue^(A)
U.S. Appraisal	$	16.6	21.8%	$	17.4	24.4%	$	(0.8)	-4.4%
U.S. Title		28.3	70.6%		17.2	55.9%		11.1	64.1%
Canada		1.8	14.1%		1.3	17.7%		0.5	32.0%
Consolidated Net Revenue^(A)	$	46.7	36.2%	$	35.9	32.8%	$	10.8	29.8%

Adjusted EBITDA^(A)
U.S. Appraisal	$	9.2	55.5%	$	10.4	59.5%	$	(1.2)	-10.9%
U.S. Title		13.0	46.1%		7.1	41.3%		5.9	83.1%
Canada		1.3	70.6%		0.8	58.3%		0.5	60.0%
Corporate		(4.5)			(3.7)			(0.8)	-23.1%
Consolidated Adjusted EBITDA^(A)	$	19.0	40.7%	$	14.6	40.6%	$	4.4	30.2%

Net income
Net income	$	11.7		$	18.7		$	(7.0)
Net income per diluted share	$	0.13		$	0.21		$	(0.08)

Adjusted Net Income^(A)
Adjusted Net Income^(A)	$	13.1		$	11.0		$	2.1
Adjusted Net Income^(A)per diluted share	$	0.15		$	0.13		$	0.02

Financial and Operational Summary (continued)

(millions of dollars)		Six months ended March 31
	2021		Margin	2020		Margin	$ Change		% Change

Revenues
U.S. Appraisal	$	145.9		$	138.7		$	7.2	5.2%
U.S. Title		80.0			59.5			20.5	34.4%
Canada		23.2			15.2			8.0	53.0%
Consolidated revenues	$	249.1		$	213.4		$	35.7	16.7%

Net Revenue^(A)
U.S. Appraisal	$	32.3	22.2%	$	32.9	23.7%	$	(0.6)	-1.6%
U.S. Title		55.0	68.7%		35.7	60.0%		19.3	53.9%
Canada		3.4	14.6%		2.6	17.4%		0.8	28.6%
Consolidated Net Revenue^(A)	$	90.7	36.4%	$	71.2	33.4%	$	19.5	27.3%

Adjusted EBITDA^(A)
U.S. Appraisal	$	18.1	55.9%	$	19.2	58.4%	$	(1.1)	-6.0%
U.S. Title		24.6	44.8%		15.6	43.6%		9.0	58.4%
Canada		2.4	72.1%		1.5	56.6%		0.9	63.8%
Corporate		(8.7)			(7.1)			(1.6)	-22.7%
Consolidated Adjusted EBITDA^(A)	$	36.4	40.2%	$	29.2	40.9%	$	7.2	25.0%

Net income
Net income	$	18.8		$	23.8		$	(5.0)
Net income per diluted share	$	0.21		$	0.27		$	(0.06)

Adjusted Net Income^(A)
Adjusted Net Income^(A)	$	25.1		$	20.3		$	4.8
Adjusted Net Income^(A)per diluted share	$	0.29		$	0.23		$	0.06

Intention to Renew Normal Course Issuer Bid

We also announced today that, subject to the approval of the Toronto Stock Exchange (“TSX”), the Company intends to renew the current NCIB for a 12-month period commencing June 11, 2021, and ending June 10, 2022. Our Board of Directors has approved the purchase of up to 4.0 million common shares for an aggregate purchase price not to exceed $56.0 million. If the NCIB is approved by the TSX, purchases will continue to be made through the facilities of the TSX and alternative Canadian trading systems at the prevailing market price at the time of acquisition. We will determine the actual number of common shares purchased under the NCIB and the timing of such purchases.

The Company believes that at times, the prevailing share price for its common shares does not reflect its underlying value such that the repurchase of common shares for cancellation represents an attractive opportunity to return value to the Company’s shareholders. The Company will use the NCIB in conjunction with its capital allocation strategy. All common shares purchased under the NCIB will be cancelled.

Our current NCIB commenced on June 11, 2020, and will expire on June 10, 2021, or earlier if we have acquired 4 million common shares. Since the beginning of our current NCIB, we have purchased for cancellation 2.0 million shares at a weighted average price of C$19.33. Since the inception of our first NCIB on June 11, 2018, the Company has acquired a total of 9.1 million shares at a weighted average price of C$10.12.

Conference Call and Webcast

A conference call to review the results will take place at 10:00 a.m. (ET) on Wednesday, April 28, 2021, hosted by Chief Executive Officer Brian Lang and Chief Financial Officer Bill Herman. An accompanying slide presentation will be posted to the Investor section of our website shortly before the call.

To access the call:

Participant Toll Free Dial-In Number: (833) 968-2239
Participant International Dial-In Number: (825) 312-2065
Conference ID: 4794289

To listen to the live webcast of the call:

Go to: https://event.on24.com/wcc/r/2929475/5417719D6AED57ADBF8E8C5C2BCF5E6D

The webcast will be archived and a transcript of the call will be available in the Investor section of our website following the call.

(A) Non-GAAP Measures

The non-GAAP measures used in this Press Release, including Net Revenue, Adjusted EBITDA and Adjusted Net Income do not have a standardized meaning prescribed by International Financial Reporting Standards and are therefore unlikely to be comparable to similar measures presented by other issuers. These non-GAAP measures are more fully defined and discussed in the Company’s MD&A for the three and six months ended March 31, 2021 available on SEDAR at www.sedar.com.

Real Matters financial results for the three and six months ended March 31, 2021 are included in the unaudited condensed consolidated financial statements and the accompanying MD&A, each of which are available on SEDAR at www.sedar.com. In addition, supplemental information is available on our website at www.realmatters.com.

Forward-Looking Information

This Press Release contains “forward-looking information” within the meaning of applicable Canadian securities laws. Words such as “could”, “forecast”, “target”, “may”, “will”, “would”, “expect”, “anticipate”, “estimate”, “intend”, “plan”, “seek”, “believe”, “likely” and “predict” and variations of such words and similar expressions are intended to identify such forward-looking information, although not all forward-looking information contains these identifying words.

The forward-looking information in this Press Release includes statements which reflect the current expectations of management with respect to our business and the industry in which we operate and is based on management’s experience and perception of historical trends, current conditions and expected future developments, as well as other factors that management believes appropriate and reasonable in the circumstances. The forward-looking information reflects management’s beliefs based on information currently available to management, including information obtained from third party sources, and should not be read as a guarantee of the occurrence or timing of any future events, performance or results.

The forward-looking information in this Press Release is subject to risks, uncertainties and other factors that are difficult to predict and that could cause actual results to differ materially from historical results or results anticipated by the forward-looking information. A comprehensive discussion of the factors which could cause results or events to differ from current expectations can be found in the “Risk Factors” section of our Annual Information Form for the year ended September 30, 2020, which is available on SEDAR at www.sedar.com.

Readers are cautioned not to place undue reliance on the forward-looking information, which reflect our expectations only as of the date of this Press Release. Except as required by law, we do not undertake to update or revise any forward-looking information, whether as a result of new information, future events or otherwise.

About Real Matters

Real Matters is a leading network management services provider for the mortgage lending and insurance industries. Real Matters’ platform combines its proprietary technology and network management capabilities with tens of thousands of independent qualified field professionals to create an efficient marketplace for the provision of mortgage lending and insurance industry services. Our clients include the majority of the top 100 mortgage lenders in the U.S. and some of the largest insurance companies in North America. We are a leading independent provider of residential real estate appraisals to the mortgage market and a leading independent provider of title and mortgage closing services in the U.S. Established in 2004, Real Matters’ principal offices include Buffalo (NY), Denver (CO), Middletown (RI), and Markham (ON). Real Matters is listed on the Toronto Stock Exchange under the symbol REAL. For more information, visit www.realmatters.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210428005313/en/

Lyne Beauregard

Vice President, Investor Relations and Marketing

Real Matters

[email protected]

416.994.5930

KEYWORDS: North America Canada

INDUSTRY KEYWORDS: Professional Services Data Management Technology Residential Building & Real Estate Insurance Construction & Property Networks

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April 28, 2021 6:48 am

Avery Dennison Announces First Quarter 2021 Results

Avery Dennison Announces First Quarter 2021 Results

Highlights:

1Q21 Reported EPS of $2.50, up 56%
- Adjusted EPS (non-GAAP) of $2.40, up 45%

1Q21 Net sales increased 19.1% to $2.05 billion
- Sales growth ex. currency (non-GAAP) of 10.9%
- Organic sales growth (non-GAAP) of 8.8%

Raised FY 2021 EPS guidance ranges
- Reported EPS range of $8.25 to $8.65 (previously $7.50 to $7.90)
- Adjusted EPS range of $8.40 to $8.80 (previously $7.65 to $8.05)

GLENDALE, Calif.–(BUSINESS WIRE)–
Avery Dennison Corporation (NYSE:AVY) today announced preliminary, unaudited results for its first quarter ended April 3, 2021 and provided an update related to the impact of the COVID-19 pandemic on the company. Non-GAAP financial measures referenced in this document are reconciled to GAAP in the attached tables. Unless otherwise indicated, comparisons are to the same period in the prior year.

“We are off to a strong start to the year, with earnings growth well above expectations, driven by higher volume and productivity gains across the portfolio,” said Mitch Butier, Avery Dennison president and CEO.

“All three of our operating segments delivered strong sales growth and significant margin expansion. Our strong performance comes at a time when the global health crisis is resurging in many parts of the world and supply chains are tightening. The current environment further reinforces our determination to remain vigilant in ensuring the health and well-being of our employees, delivering for our customers, supporting our communities, and creating value for our shareholders.

“We have raised our full-year outlook for adjusted earnings per share, reflecting the strong performance in the first quarter, and a higher organic growth assumption for the balance of the year,” said Butier. “We continue to remain confident that the consistent execution of our strategies will enable us to meet our long-term goals for superior value creation for all our stakeholders.”

“Once again, I want to thank our entire team for their tireless efforts to keep one another safe while delivering for our customers during this challenging period, bringing a whole new level of agility and dedication to address the unique challenges at hand.”

COVID-19/Operational Update

Uncertainty surrounding the global health crisis remains elevated as many parts of the world are experiencing a resurgence in COVID-19 cases. The safety and well-being of employees has been and will continue to be the company’s top priority. The company has taken steps to ensure employee safety, quickly implementing world-class safety protocols and continuing to adapt guidelines as the pandemic evolves.

As supply chains remain tight, the company continues to actively manage through a dynamic supply and demand environment. The company is leveraging its global scale and working closely with customers and suppliers to deliver industry-leading products and services. The company continues to mitigate risk to keep supply chain disruptions negligible and the team continues to demonstrate agility and preparedness through robust scenario planning.

First Quarter 2021 Results by Segment

Label and Graphic Materials

Reported sales increased 17.3% to $1.38 billion. Sales were up 8.4% ex. currency and 7.6% on an organic basis.
- Label and Packaging Materials sales were up approximately 7% from prior year on an organic basis, with strong growth in both the high value product categories and the base business.
- Sales increased by approximately 9% organically in the combined Graphics and Reflective Solutions businesses.
- On an organic basis, sales were up low-single digits in North America and Western Europe, and up mid-teens in emerging markets.

Reported operating margin increased 170 basis points to 16.4%. Adjusted operating margin increased 150 basis points to 16.3%, as the benefits from higher volume/mix, lower receivables reserves and productivity more than offset higher employee-related costs and the net impact of pricing and raw material costs.

Retail Branding and Information Solutions

Reported sales increased 20.1% to $483 million. Sales were up 15.0% ex. currency and 9.3% on an organic basis, reflecting strong growth in both the high value categories and the base business.
- Intelligent Labels were up approximately 40% ex. currency with the benefit of the Smartrac acquisition, and up approximately 20% organically.

Reported operating margin increased 470 basis points to 12.4%. Adjusted operating margin increased 440 basis points to 12.9%, as the benefits from higher volume, lower receivables reserves and productivity more than offset higher employee-related costs and growth investments.

Industrial and Healthcare Materials

Reported sales increased 29.8% to $192 million. Sales were up 18.8% ex. currency and 16.3% on an organic basis, reflecting an approximately 20% increase in industrial categories and a low-single digit decline in healthcare categories.
Reported operating margin increased 220 basis points to 12.3%. Adjusted operating margin increased 190 basis points to 12.3%, as the benefit from higher volume/mix more than offset higher employee-related costs.

Other

Balance Sheet, Liquidity, and Capital Deployment

The company’s balance sheet remains strong, with ample liquidity. The company deployed $31 million for acquisitions and equity investments in the first quarter, including two strategic acquisitions, JDC Solutions, Inc. in the IHM segment and ZippyYum, LLC in the RBIS segment.

The company recently announced it raised its quarterly dividend rate by 10%, following a 7% increase in 2020. Additionally, the company repurchased 0.3 million shares in the first quarter at an aggregate cost of $56 million. Net of dilution from long-term incentive awards, the company’s share count at the end of the quarter was down by 0.2 million compared to the same time last year. During the first quarter, the company returned $107 million in cash to shareholders through a combination of share repurchases and dividends.

Income Taxes

The company’s first quarter effective tax rate was 21.6%. The adjusted (non-GAAP) tax rate for the quarter was 25.0%, reflecting the company’s current expectation for the full-year adjusted tax rate.

Cost Reduction Actions

In the first quarter, the company realized approximately $19 million in pre-tax savings from restructuring, net of transition costs, and incurred pre-tax restructuring charges of approximately $3 million, the vast majority of which represents cash charges.

Outlook

In its supplemental presentation materials, “First Quarter 2021 Financial Review and Analysis,” the company provides a list of factors that it believes will contribute to its 2021 financial results. Based on the factors listed and other assumptions, the company has raised its guidance range for 2021 reported earnings per share from a range of $7.50 to $7.90 to a range of $8.25 to $8.65. Excluding an estimated $0.15 per share related to restructuring charges and other items, the company’s guidance for adjusted earnings per share has been raised from a range of $7.65 to $8.05 to a range of $8.40 to $8.80.

For more details on the company’s results, see the summary tables accompanying this news release, as well as the supplemental presentation materials, “First Quarter 2021 Financial Review and Analysis,” posted on the company’s website at www.investors.averydennison.com, and furnished to the SEC on Form 8-K.

Throughout this release and the supplemental presentation materials, amounts on a per share basis reflect fully diluted shares outstanding.

About Avery Dennison

Avery Dennison Corporation (NYSE: AVY) is a global materials science company specializing in the design and manufacture of a wide variety of labeling and functional materials. The company’s products, which are used in nearly every major industry, include pressure-sensitive materials for labels and graphic applications; tapes and other bonding solutions for industrial, medical, and retail applications; tags, labels and embellishments for apparel; and radio frequency identification (RFID) solutions serving retail apparel and other markets. Headquartered in Glendale, California, the company employs more than 32,000 employees in more than 50 countries. Reported sales in 2020 were $7.0 billion. Learn more at www.averydennison.com.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995

Certain statements contained in this document are “forward-looking statements” intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements, and financial or other business targets, are subject to certain risks and uncertainties. We believe that the most significant risk factors that could affect our financial performance in the near-term include: (i) the impacts to underlying demand for our products and/or foreign currency fluctuations from global economic conditions, political uncertainty, changes in environmental standards and governmental regulations, including as a result of the coronavirus/COVID-19 pandemic; (ii) competitors’ actions, including pricing, expansion in key markets, and product offerings; (iii) the degree to which higher costs can be offset with productivity measures and/or passed on to customers through price increases, without a significant loss of volume; and (iv) the execution and integration of acquisitions.

Actual results and trends may differ materially from historical or anticipated results depending on a variety of factors, including but are not limited to, risks and uncertainties relating to the following:

COVID-19
International Operations – worldwide and local economic and market conditions; changes in political conditions; and fluctuations in foreign currency exchange rates and other risks associated with foreign operations, including in emerging markets.
Our Business – changes in our markets due to competitive conditions, technological developments, environmental standards, laws and regulations, and customer preferences; fluctuations in demand affecting sales to customers; execution and integration of acquisitions; selling prices; fluctuations in the cost and availability of raw materials and energy; the impact of competitive products and pricing; customer and supplier concentrations or consolidations; financial condition of distributors; outsourced manufacturers; product and service quality; timely development and market acceptance of new products, including sustainable or sustainably-sourced products; investment in development activities and new production facilities; successful implementation of new manufacturing technologies and installation of manufacturing equipment; our ability to generate sustained productivity improvement; our ability to achieve and sustain targeted cost reductions; and collection of receivables from customers.
Income Taxes – fluctuations in tax rates; changes in tax laws and regulations, and uncertainties associated with interpretations of such laws and regulations; retention of tax incentives; outcome of tax audits; and the realization of deferred tax assets.
Information Technology – disruptions in information technology systems, including cyber-attacks or other intrusions to network security; successful installation of new or upgraded information technology systems; and data security breaches.
Human Capital – recruitment and retention of employees; fluctuations in employee benefit costs; and collective labor arrangements.
Our Indebtedness – credit risks; our ability to obtain adequate financing arrangements and maintain access to capital; volatility of financial markets; fluctuations in interest rates; and compliance with our debt covenants.
Ownership of Our Stock – potential significant variability of our stock price and amounts of future dividends and share repurchases.
Legal and Regulatory Matters – protection and infringement of intellectual property and impact of legal and regulatory proceedings, including with respect to environmental, health and safety, anti-corruption and trade compliance.
Other Financial Matters – fluctuations in pension costs and goodwill impairment.

For a more detailed discussion of these factors, see “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2020 Form 10-K, filed with the Securities and Exchange Commission on February 25, 2021.

The forward-looking statements included in this document are made only as of the date of this document, and we undertake no obligation to update these statements to reflect subsequent events or circumstances, other than as may be required by law.

For more information and to listen to a live broadcast or an audio replay of the quarterly conference call with analysts, visit the Avery Dennison website at www.investors.averydennison.com

First Quarter Financial Summary – Preliminary, unaudited

(In millions, except % and per share amounts)

% Sales Change vs. P/Y

2021

2020

Reported

Ex. Currency

Organic

(a)

(b)

Net sales, by segment:

Label and Graphic Materials

$1,377.0

$1,173.5

17.3%

8.4%

7.6%

Retail Branding and Information Solutions

482.7

401.9

20.1%

15.0%

9.3%

Industrial and Healthcare Materials

191.6

147.6

29.8%

18.8%

16.3%

Total net sales

$2,051.3

$1,723.0

19.1%

10.9%

8.8%

As Reported (GAAP)

Adjusted Non-GAAP (c)

% of Sales

2021

2020

Change

2021

2020

2021

2020

Change

2021

2020

Operating income (loss) / operating margins before interest, other non-operating expense (income), and taxes, by segment:

Label and Graphic Materials

$226.2

$172.5

16.4%

14.7%

$224.3

$173.6

16.3%

14.8%

Retail Branding and Information Solutions

60.0

30.9

12.4%

7.7%

62.1

34.2

12.9%

8.5%

Industrial and Healthcare Materials

23.5

14.9

12.3%

10.1%

23.6

15.4

12.3%

10.4%

Corporate expense

(25.9)

(19.1)

(25.3)

(19.1)

Total operating income / operating margins before interest, other non-operating expense (income), and taxes

$283.8

$199.2

42%

13.8%

11.6%

$284.7

$204.1

39%

13.9%

11.8%

Interest expense

$16.2

$18.8

$16.2

$18.8

Other non-operating expense (income), net (d)

($1.3)

($0.5)

($1.7)

($0.5)

Income before taxes

$268.9

$180.9

49%

13.1%

10.5%

$270.2

$185.8

45%

13.2%

10.8%

Provision for (benefit from) income taxes

$58.1

$46.3

$67.6

$45.9

Equity method investment (losses) gains

($1.3)

($0.4)

($1.3)

($0.4)

Net income

$209.5

$134.2

56%

10.2%

7.8%

$201.3

$139.5

44%

9.8%

8.1%

Net income per common share, assuming dilution

$2.50

$1.60

56%

$2.40

$1.66

45%

Free Cash Flow (e)

$182.0

($35.3)

See accompanying schedules A-4 to A-8 for reconciliations from GAAP to non-GAAP financial measures.

(a)

Sales change ex. currency refers to the increase or decrease in net sales, excluding the estimated impact of foreign currency translation, and, where applicable, the calendar shift resulting from the extra week in the prior fiscal year and currency adjustment for transitional reporting of highly inflationary economies. The estimated impact of foreign currency translation is calculated on a constant currency basis, with prior period results translated at current period average exchange rates to exclude the effect of currency fluctuations.

(b)

Organic sales change refers to sales change ex. currency, excluding the estimated impact of product line exits, acquisitions and divestitures.

(c)

Excludes impact of restructuring charges and other items. Corporate expense excludes impact of severance and related costs of $.6 in the first quarter of 2021.

(d)

As reported “Other non-operating expense (income), net” includes pension plan settlement loss of $.4 in the first quarter of 2021.

(e)

A-1

AVERY DENNISON CORPORATION
PRELIMINARY CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share amounts)


		(UNAUDITED)

		Three Months Ended

		Apr. 3, 2021			Mar. 28, 2020


Net sales	$	2,051.3		$	1,723.0
Cost of products sold		1,454.3			1,237.9
Gross profit		597.0			485.1
Marketing, general and administrative expense		312.3			281.0
Other expense (income), net⁽¹⁾		0.9			4.9
Interest expense		16.2			18.8
Other non-operating expense (income), net⁽²⁾		(1.3	)		(0.5	)
Income before taxes		268.9			180.9
Provision for (benefit from) income taxes		58.1			46.3
Equity method investment (losses) gains		(1.3	)		(0.4	)
Net income	$	209.5		$	134.2

Per share amounts:
Net income per common share, assuming dilution	$	2.50		$	1.60

Weighted average number of common shares outstanding, assuming dilution		83.9			84.1

⁽¹⁾		“Other expense (income), net” for the first quarter of 2021 includes severance and related costs of $2.4, asset impairment and lease cancellation charges of $.5, outcome of legal proceedings of $2.1, and transaction and related costs of $.7, partially offset by gain on sale of product line of $4.8.

		“Other expense (income), net” for the first quarter of 2020 includes severance and related costs of $2.4 and transaction and related costs of $2.5.

⁽²⁾		“Other non-operating expense (income), net” for the first quarter of 2021 includes pension plan settlement loss of $.4.


A-2

AVERY DENNISON CORPORATION
PRELIMINARY CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions)


				(UNAUDITED)

ASSETS			Apr. 3, 2021				Mar. 28, 2020


Current assets:
	Cash and cash equivalents			$	328.0			$	742.0
	Trade accounts receivable, net				1,301.4				1,222.5
	Inventories, net				786.7				723.3
	Other current assets				216.3				225.8
		Total current assets			2,632.4				2,913.6
Property, plant and equipment, net					1,329.0				1,232.0
Goodwill and other intangibles resulting from business acquisitions, net					1,363.5				1,225.7
Deferred tax assets					201.4				224.8
Other assets					746.9				664.8
				$	6,273.2			$	6,260.9



LIABILITIES AND SHAREHOLDERS’ EQUITY


Current liabilities:
	Short-term borrowings and current portion of long-term debt and finance leases			$	116.9			$	832.3
	Accounts payable				1,178.0				1,030.8
	Other current liabilities				763.6				697.0
		Total current liabilities			2,058.5				2,560.1
Long-term debt and finance leases					2,025.9				1,988.0
Other long-term liabilities					606.9				539.4
Shareholders’ equity:
	Common stock				124.1				124.1
	Capital in excess of par value				845.8				852.5
	Retained earnings				3,504.4				3,064.8
	Treasury stock at cost				(2,546.3	)			(2,456.0	)
	Accumulated other comprehensive loss				(346.1	)			(412.0	)
		Total shareholders’ equity			1,581.9				1,173.4
				$	6,273.2			$	6,260.9

A-3

AVERY DENNISON CORPORATION
PRELIMINARY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)


			(UNAUDITED)

			Three Months Ended

		Apr. 3, 2021				Mar. 28, 2020



Operating Activities:
Net income			$	209.5			$	134.2
Adjustments to reconcile net income to net cash provided by operating activities:
	Depreciation			40.0				36.8
	Amortization			14.4				10.7
	Provision for credit losses and sales returns			8.9				31.2
	Stock-based compensation			9.9				6.3
	Pension plan settlement loss			0.4				—
	Deferred taxes and other non-cash taxes			1.5				6.4
	Other non-cash expense and loss (income and gain), net			2.7				4.4
Changes in assets and liabilities and other adjustments				(78.0	)			(225.6	)
Net cash provided by operating activities				209.3				4.4

Investing Activities:
Purchases of property, plant and equipment				(25.2	)			(33.2	)
Purchases of software and other deferred charges				(2.3	)			(6.2	)
Proceeds from sales of property, plant and equipment				0.7				—
Proceeds from insurance and sales (purchases) of investments, net				(0.5	)			(0.3	)
Proceeds from sale of product line				6.7				—
Payments for acquisitions, net of cash acquired, and investments in businesses				(30.6	)			(245.9	)
Net cash used in investing activities				(51.2	)			(285.6	)

Financing Activities:
Net increase (decrease) in borrowings (maturities of three months or less)				53.8				(106.0	)
Additional borrowings under revolving credit facility				—				500.0
Additional long-term borrowings				—				494.4
Repayments of long-term debt and finance leases				(1.5	)			(1.1	)
Dividends paid				(51.6	)			(48.4	)
Share repurchases				(55.6	)			(45.2	)
Net (tax withholding) proceeds related to stock-based compensation				(25.3	)			(20.0	)
Net cash (used in) provided by financing activities				(80.2	)			773.7
Effect of foreign currency translation on cash balances				(2.2	)			(4.2	)
Increase (decrease) in cash and cash equivalents				75.7				488.3
Cash and cash equivalents, beginning of year				252.3				253.7
Cash and cash equivalents, end of period			$	328.0			$	742.0

A-4

Reconciliation of Non-GAAP Financial Measures to GAAP

We report our financial results in conformity with accounting principles generally accepted in the United States of America, or GAAP, and also communicate with investors using certain non-GAAP financial measures. These non-GAAP financial measures are not in accordance with, nor are they a substitute for or superior to, the comparable GAAP financial measures. These non-GAAP financial measures are intended to supplement the presentation of our financial results that are prepared in accordance with GAAP. Based upon feedback from investors and financial analysts, we believe that the supplemental non-GAAP financial measures we provide are useful to their assessments of our performance and operating trends, as well as liquidity

Our non-GAAP financial measures exclude the impact of certain events, activities or strategic decisions. The accounting effects of these events, activities or decisions, which are included in the GAAP financial measures, may make it difficult to assess our underlying performance in a single period. By excluding the accounting effects, positive or negative, of certain items (e.g., restructuring charges, outcome of certain legal proceedings, certain effects of strategic transactions and related costs, losses from debt extinguishments, gains or losses from curtailment or settlement of pension obligations, gains or losses on sales of certain assets, gains or losses on investments, and other items), we believe that we are providing meaningful supplemental information that facilitates an understanding of our core operating results and liquidity measures. While some of the items we exclude from GAAP financial measures recur, they tend to be disparate in amount, frequency, or timing.

We use these non-GAAP financial measures internally to evaluate trends in our underlying performance, as well as to facilitate comparison to the results of competitors for a single period and full year, as applicable.

We use the following non-GAAP financial measures in the accompanying news release and presentation:

Organic sales change refers to sales change ex. currency, excluding the estimated impact of product line exits, acquisitions and divestitures.

We believe that sales change ex. currency and organic sales change assist investors in evaluating the sales change from the ongoing activities of our businesses and enhance their ability to evaluate our results from period to period.

Adjusted operating income refers to income before taxes; interest expense; other non-operating expense (income), net; and other expense (income), net.

Adjusted EBITDA refers to adjusted operating income before depreciation and amortization.

Adjusted operating margin refers to adjusted operating income as a percentage of net sales.

Adjusted EBITDA margin refers to adjusted EBITDA as a percentage of net sales.

Adjusted tax rate refers to the projected full-year GAAP tax rate, adjusted to exclude certain unusual or infrequent events that are expected to significantly impact that rate, such as effects of certain discrete tax planning actions, impacts related to the enactment of the U.S. Tax Cuts and Jobs Act (“TCJA”), where applicable, and other items.

Adjusted net income refers to income before taxes, tax-effected at the adjusted tax rate, and adjusted for tax-effected restructuring charges and other items.

Adjusted net income per common share, assuming dilution (adjusted EPS) refers to adjusted net income divided by weighted average number of common shares outstanding, assuming dilution.

We believe that adjusted operating margin, adjusted EBITDA margin, adjusted net income, and adjusted EPS assist investors in understanding our core operating trends and comparing our results with those of our competitors.

Net debt to adjusted EBITDA ratio refers to total debt (including finance leases) less cash and cash equivalents, divided by adjusted EBITDA for the last twelve months. We believe that the net debt to adjusted EBITDA ratio assists investors in assessing our leverage position.

Free cash flow refers to cash flow provided by operating activities, less payments for property, plant and equipment, software and other deferred charges, plus proceeds from sales of property, plant and equipment, plus (minus) net proceeds from insurance and sales (purchases) of investments. We believe that free cash flow assists investors by showing the amount of cash we have available for debt reductions, dividends, share repurchases, and acquisitions.

The following reconciliations are provided in accordance with Regulations G and S-K and reconcile our non-GAAP financial measures with the most directly comparable GAAP financial measures.

A-5

AVERY DENNISON CORPORATION
PRELIMINARY RECONCILIATION FROM GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, except % and per share amounts)

					(UNAUDITED)

					Three Months Ended

					Apr. 3, 2021			Mar. 28, 2020


Reconciliation from GAAP to Non-GAAP operating margins:
Net sales				$	2,051.3		$	1,723.0
Income before taxes				$	268.9		$	180.9
Income before taxes as a percentage of net sales					13.1	%		10.5	%
	Adjustments:
		Interest expense		$	16.2		$	18.8
		Other non-operating expense (income), net			(1.3	)		(0.5	)
Operating income before interest expense, other non-operating expense (income), and taxes				$	283.8		$	199.2
Operating margins					13.8	%		11.6	%


Income before taxes				$	268.9		$	180.9
	Adjustments:
		Restructuring charges:
			Severance and related costs		2.4			2.4
			Asset impairment and lease cancellation charges		0.5			—
		Outcome of legal proceedings			2.1			—
		Transaction and related costs			0.7			2.5
		Gain on sale of product line			(4.8	)		—
		Interest expense			16.2			18.8
		Other non-operating expense (income), net			(1.3	)		(0.5	)
Adjusted operating income (non-GAAP)				$	284.7		$	204.1
Adjusted operating margins (non-GAAP)					13.9	%		11.8	%

Reconciliation from GAAP to Non-GAAP net income:
As reported net income				$	209.5		$	134.2
	Adjustments:
		Restructuring charges and other items⁽¹⁾			0.9			4.9
		Pension plan settlement loss			0.4			—
		Tax effect on restructuring charges and other items and impact of adjusted tax rate			(9.5	)		0.4
Adjusted net income (non-GAAP)				$	201.3		$	139.5

⁽¹⁾ Includes pretax restructuring and related charges, outcome of legal proceedings, transaction and related costs, and gain on sale of product line.

A-5 (continued)

AVERY DENNISON CORPORATION
PRELIMINARY RECONCILIATION FROM GAAP TO NON-GAAP FINANCIAL MEASURES
(In millions, except % and per share amounts)


				(UNAUDITED)

				Three Months Ended

				Apr. 3, 2021			Mar. 28, 2020


Reconciliation from GAAP to Non-GAAP net income per common share:
As reported net income per common share, assuming dilution			$	2.50		$	1.60
	Adjustments per common share, net of tax:
		Restructuring charges and other items⁽¹⁾		0.01			0.06
		Tax effect on restructuring charges and other items and impact of adjusted tax rate		(0.11	)		—

Adjusted net income per common share, assuming dilution (non-GAAP)			$	2.40		$	1.66
Weighted average number of common shares outstanding, assuming dilution				83.9			84.1

Our adjusted tax rate was 25% and 24.7% for the three months ended Apr. 3, 2021 and Mar. 28, 2020, respectively.

⁽¹⁾ Includes pretax restructuring and related charges, outcome of legal proceedings, transaction and related costs, and gain on sale of product line.

				(UNAUDITED)

				Three Months Ended

				Apr. 3, 2021			Mar. 28, 2020


Reconciliation of free cash flow:

Net cash provided by operating activities			$	209.3		$	4.4
Purchases of property, plant and equipment				(25.2	)		(33.2	)
Purchases of software and other deferred charges				(2.3	)		(6.2	)
Proceeds from sales of property, plant and equipment				0.7			—
Proceeds from insurance and sales (purchases) of investments, net				(0.5	)		(0.3	)
Free cash flow (non-GAAP)			$	182.0		$	(35.3	)

A-6

AVERY DENNISON CORPORATION
PRELIMINARY SUPPLEMENTARY INFORMATION
(In millions, except %)
(UNAUDITED)

	First Quarter Ended

	NET SALES				OPERATING INCOME (LOSS)						OPERATING MARGINS
		2021		2020		2021			2020		2021		2020

Label and Graphic Materials	$	1,377.0	$	1,173.5	$	226.2		$	172.5		16.4	%	14.7	%
Retail Branding and Information Solutions		482.7		401.9		60.0			30.9		12.4	%	7.7	%
Industrial and Healthcare Materials		191.6		147.6		23.5			14.9		12.3	%	10.1	%
Corporate Expense		N/A		N/A		(25.9	)		(19.1	)	N/A		N/A
TOTAL FROM OPERATIONS	$	2,051.3	$	1,723.0	$	283.8		$	199.2		13.8	%	11.6	%


RECONCILIATION FROM GAAP TO NON-GAAP SUPPLEMENTARY INFORMATION

					First Quarter Ended
					OPERATING INCOME						OPERATING MARGINS

						2021			2020		2021		2020
Label and Graphic Materials
Operating income and margins, as reported					$	226.2		$	172.5		16.4	%	14.7	%
Adjustments:
Restructuring charges:
Severance and related costs						0.6			0.4		—		—
Asset impairment charges						0.1			—		—		—
Outcome of legal proceedings						2.1			—		0.2	%	—
Transaction and related costs						0.1			0.7		—		0.1	%
Gain on sale of product line						(4.8	)		—		(0.3	%)	—
Adjusted operating income and margins (non-GAAP)					$	224.3		$	173.6		16.3	%	14.8	%
Depreciation and amortization						29.0			26.1		2.1	%	2.2	%
Adjusted EBITDA and margins (non-GAAP)					$	253.3		$	199.7		18.4	%	17.0	%

Retail Branding and Information Solutions
Operating income and margins, as reported					$	60.0		$	30.9		12.4	%	7.7	%
Adjustments:
Restructuring charges:
Severance and related costs						1.2			1.5		0.3	%	0.4	%
Asset impairment and lease cancellation charges						0.4			—		0.1	%	—
Loss on sale of asset						0.3			—		0.1	%	—
Transaction and related costs						0.2			1.8		—		0.4	%
Adjusted operating income and margins (non-GAAP)					$	62.1		$	34.2		12.9	%	8.5	%
Depreciation and amortization						18.6			14.9		3.8	%	3.7	%
Adjusted EBITDA and margins (non-GAAP)					$	80.7		$	49.1		16.7	%	12.2	%

Industrial and Healthcare Materials
Operating income and margins, as reported					$	23.5		$	14.9		12.3	%	10.1	%
Adjustments:
Restructuring charges:
Severance and related costs						—			0.5		—		0.3	%
Transaction and related costs						0.4			—		0.2	%	—
Gain on sale of assets						(0.3	)		—		(0.2	%)	—
Adjusted operating income and margins (non-GAAP)					$	23.6		$	15.4		12.3	%	10.4	%
Depreciation and amortization						6.8			6.5		3.6	%	4.4	%
Adjusted EBITDA and margins (non-GAAP)					$	30.4		$	21.9		15.9	%	14.8	%

A-7

AVERY DENNISON CORPORATION
PRELIMINARY SUPPLEMENTARY INFORMATION
Reconciliation of Adjusted EBITDA Margins and Net Debt to Adjusted EBITDA
(In millions, except %)
(UNAUDITED)

	(13 weeks)		(13 weeks)		(13 weeks)		(14 weeks)		(13 weeks)
	QTD								QTD
Total Company		1Q20		2Q20		3Q20		4Q20		1Q21
Net sales	$	1,723.0	$	1,528.5	$	1,729.1	$	1,990.9	$	2,051.3
Operating income before interest expense, other non-operating expense (income), and taxes, as reported	$	199.2	$	123.5	$	213.5	$	273.0	$	283.8
Operating margins, as reported		11.6%		8.1%		12.3%		13.7%		13.8%
Non-GAAP adjustments:
Restructuring charges:
Severance and related costs	$	2.4	$	37.5	$	6.5	$	2.7	$	2.4
Asset impairment and lease cancellation charges		–		1.8		4.4		–		0.5
Other items		2.5		0.7		1.5		(6.4)		(2.0)
Adjusted operating income (non-GAAP)	$	204.1	$	163.5	$	225.9	$	269.3	$	284.7
Adjusted operating margins (non-GAAP)		11.8%		10.7%		13.1%		13.5%		13.9%
Depreciation and amortization	$	47.5	$	50.3	$	52.0	$	55.5	$	54.4
Adjusted EBITDA (non-GAAP)	$	251.6	$	213.8	$	277.9	$	324.8	$	339.1
Adjusted EBITDA margins (non-GAAP)		14.6%		14.0%		16.1%		16.3%		16.5%


Total Debt									$	2,142.8
Less: Cash and cash equivalents										328.0
Net Debt									$	1,814.8
Net Debt to Adjusted EBITDA LTM* (non-GAAP)										1.6
*LTM = Last twelve months (2Q20 to 1Q21)

A-8

AVERY DENNISON CORPORATION
PRELIMINARY SUPPLEMENTARY INFORMATION
(UNAUDITED)


	First Quarter 2021
	Total Company	Label and Graphic Materials	Retail Branding and Information Solutions	Industrial and Healthcare Materials
Reconciliation from GAAP to Non-GAAP sales change
Reported net sales change	19.1%	17.3%	20.1%	29.8%
Foreign currency translation	(4.4%)	(5.0%)	(1.8%)	(6.5%)
Extra week impact	(3.8%)	(3.9%)	(3.3%)	(4.5%)
Sales change ex. currency (non-GAAP)⁽¹⁾	10.9%	8.4%	15.0%	18.8%
Acquisitions and divestiture	(2.1%)	(0.8%)	(5.7%)	(2.5%)
Organic sales change (non-GAAP)⁽¹⁾	8.8%	7.6%	9.3%	16.3%

	Fourth Quarter 2020
	Total Company	Label and Graphic Materials	Retail Branding and Information Solutions	Industrial and Healthcare Materials
Reconciliation from GAAP to Non-GAAP sales change
Reported net sales change	12.3%	10.1%	19.0%	10.8%
Foreign currency translation	(2.3%)	(2.5%)	(0.9%)	(4.0%)
Extra week impact	(4.9%)	(4.1%)	(6.6%)	(6.1%)
Sales change ex. currency (non-GAAP)⁽¹⁾	5.2%	3.6%	11.6%	0.7%
Acquisitions	(2.0%)	—	(8.4%)	—
Organic sales change (non-GAAP)⁽¹⁾	3.2%	3.6%	3.1%	0.7%

	Third Quarter 2020
	Total Company	Label and Graphic Materials	Retail Branding and Information Solutions	Industrial and Healthcare Materials
Reconciliation from GAAP to Non-GAAP sales change
Reported net sales change	(1.8%)	(3.3%)	4.7%	(7.0%)
Foreign currency translation	0.5%	0.7%	0.5%	(0.5%)
Sales change ex. currency (non-GAAP)⁽¹⁾	(1.3%)	(2.6%)	5.2%	(7.6%)
Acquisitions	(2.3%)	—	(10.0%)	—
Organic sales change (non-GAAP)⁽¹⁾	(3.6%)	(2.6%)	(4.7%)	(7.6%)

	Second Quarter 2020
	Total Company	Label and Graphic Materials	Retail Branding and Information Solutions	Industrial and Healthcare Materials
Reconciliation from GAAP to Non-GAAP sales change
Reported net sales change	(14.9%)	(8.7%)	(29.5%)	(22.8%)
Foreign currency translation	2.9%	3.8%	1.3%	1.9%
Sales change ex. currency (non-GAAP)⁽¹⁾	(12.0%)	(4.9%)	(28.2%)	(20.9%)
Acquisitions	(1.7%)	—	(7.3%)	—
Organic sales change (non-GAAP)⁽¹⁾	(13.7%)	(4.9%)	(35.5%)	(20.9%)

	First Quarter 2020
	Total Company	Label and Graphic Materials	Retail Branding and Information Solutions	Industrial and Healthcare Materials
Reconciliation from GAAP to Non-GAAP sales change
Reported net sales change	(1.0%)	(0.4%)	0.9%	(9.7%)
Foreign currency translation	1.9%	2.2%	1.0%	2.0%
Sales change ex. currency (non-GAAP)⁽¹⁾	1.0%	1.8%	2.0%	(7.8%)
Acquisitions	(0.7%)	—	(3.1%)	—
Organic sales change (non-GAAP)⁽¹⁾	0.3%	1.8%	(1.1%)	(7.8%)

⁽¹⁾Totals may not sum due to rounding.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210428005134/en/

Media Relations:

Rob Six (626) 304-2361

[email protected]

Investor Relations:

John Eble (440) 534-6290

[email protected]

KEYWORDS: California United States North America

INDUSTRY KEYWORDS: Supply Chain Management Packaging Retail Chemicals/Plastics Manufacturing Other Manufacturing Office Products

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April 28, 2021 6:48 am

Pfizer Acquires Amplyx Pharmaceuticals

Pfizer Acquires Amplyx Pharmaceuticals

Deal expands anti-infectives pipeline with addition of novel antifungal Phase 2 candidate, Fosmanogepix (APX001)

Opportunity to advance Pfizer’s expertise and deep heritage in infectious disease

NEW YORK–(BUSINESS WIRE)–
Pfizer Inc. (NYSE: PFE) announced today that it has acquired Amplyx Pharmaceuticals, Inc., a privately-held company dedicated to the development of therapies for debilitating and life-threatening diseases that affect people with compromised immune systems. Amplyx’s lead compound, Fosmanogepix (APX001), is a novel investigational asset under development for the treatment of invasive fungal infections.

More than 1.5 million cases of invasive fungal infections occur worldwide each year, with mortality rates as high as 30-80% across infection typesⁱ. Fosmanogepix has a novel mechanism of action with the potential to target fungal strains resistant to standard of care therapy. As there are only three classes of antifungal medications currently available, antifungal resistance can severely limit treatment options; a potential new therapeutic class may therefore be of importance for both physicians and patientsⁱⁱ. There has been no novel therapeutic class of antifungal therapies approved by the U.S. Food and Drug Administration (FDA) in nearly 20 years.

“The COVID-19 pandemic has been a stark reminder of the devastating impact of infectious diseases, highlighting the continuous need for new anti-infective therapies to treat both emerging and difficult to treat bacterial, viral and fungal infections,” said Angela Lukin, Global President, Pfizer Hospital. “We are deeply committed to helping patients suffering from infectious diseases, continuously seeking opportunities to build our portfolio of anti-infective therapies. We’ve already invested in assets that, if approved, could help address drug-resistant bacterial infections and critical viral infections; with this acquisition, we look forward to progressing the development of a novel anti-fungal as well.”

Fosmanogepix is currently in Phase 2 clinical trials evaluating the safety and efficacy of both intravenous (IV) and oral formulations for the treatment of patients with life-threatening invasive fungal infections caused by molds, yeasts and rare molds (e.g., Aspergillus spp, Candida spp including Candida auris, Fusarium spp. and Scedosporium spp). Fosmanogepix has demonstrated broad-spectrum activity in-vitro and has shown wide distribution to various tissues including the brain, lung, kidney and eye. With both IV and oral formulations in development, Fosmanogepix may allow for the transition from IV to oral, thus potentially enabling, for the benefit of patients, the continuation of treatment outside the hospital.

In addition to Fosmanogepix, with this acquisition, Pfizer has secured ownership of Amplyx’s early-stage pipeline that includes potential antiviral (MAU868) and antifungal (APX2039) therapies.

Globally, infectious diseases are responsible for more than 8.4 million deaths annually^*iii, accounting for two of the World Health Organization’s top ten causes of death worldwide^iv. Infections are caused by different types of pathogens, including bacteria, viruses, fungi and parasites, and can be acquired in the community or in a hospital or healthcare setting.

The acquisition of Amplyx follows an initial equity investment by Pfizer in December 2019 as part of Amplyx’s Series C financing. At that time, Pfizer joined a world class group of biotechnology investors that included 3×5 Partners, Adage Capital Management, Arix Bioscience, BioMed Ventures, Lundbeckfonden Ventures, New Enterprise Associates, Pappas Capital, RiverVest Venture Partners and Sofinnova Investments.

Financial terms of this acquisition were not disclosed.

DLA Piper LLP (US) served as Pfizer Inc.’s legal advisor for the transaction, while Cooley LLP served as Amplyx’s legal advisor and Evercore as its financial advisor.

About Pfizer: Breakthroughs That Change Patients’ Lives

At Pfizer, we apply science and our global resources to bring therapies to people that extend and significantly improve their lives. We strive to set the standard for quality, safety and value in the discovery, development and manufacture of health care products, including innovative medicines and vaccines. Every day, Pfizer colleagues work across developed and emerging markets to advance wellness, prevention, treatments and cures that challenge the most feared diseases of our time. Consistent with our responsibility as one of the world’s premier innovative biopharmaceutical companies, we collaborate with health care providers, governments and local communities to support and expand access to reliable, affordable health care around the world. For more than 170 years, we have worked to make a difference for all who rely on us. We routinely post information that may be important to investors on our website at www.Pfizer.com. In addition, to learn more, please visit us on www.Pfizer.com and follow us on Twitter at @Pfizer and @Pfizer News, LinkedIn, YouTube and like us on Facebook at Facebook.com/Pfizer.

PFIZER DISCLOSURE NOTICE

The information contained in this release is as of April 28, 2021. Pfizer assumes no obligation to update forward-looking statements contained in this release as the result of new information or future events or developments.

This release contains forward-looking information about Amplyx Pharmaceuticals, Amplyx’s lead compound, Fosmanogepix (APX001), the acquisition of Amplyx by Pfizer and Pfizer’s anti-infectives portfolio that involves substantial risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Risks and uncertainties include, among other things; risks related to the ability to realize the anticipated benefits of the acquisition, including the possibility that the expected benefits from the acquisition will not be realized or will not be realized within the expected time period; the risk that the businesses will not be integrated successfully; disruption from the transaction making it more difficult to maintain business and operational relationships; significant transaction costs; unknown liabilities; the risk of litigation and/or regulatory actions related to the acquisition; other business effects, including the effects of industry, market, economic, political or regulatory conditions; future exchange and interest rates; changes in tax and other laws, regulations, rates and policies; future business combinations or disposals; the uncertainties inherent in research and development, including the ability to meet anticipated clinical endpoints, commencement and/or completion dates for clinical trials, regulatory submission dates, regulatory approval dates and/or launch dates, as well as the possibility of unfavorable new clinical data and further analyses of existing clinical data; the risk that clinical trial data are subject to differing interpretations and assessments by regulatory authorities; whether regulatory authorities will be satisfied with the design of and results from our clinical studies; whether and when drug applications may be filed in any jurisdictions for Fosmanogepix or any other anti-infectives; whether and when any such applications may be approved by regulatory authorities, which will depend on myriad factors, including making a determination as to whether the product’s benefits outweigh its known risks and determination of the product’s efficacy and, if approved, whether Fosmanogepix or any such other anti-infectives will be commercially successful; decisions by regulatory authorities impacting labeling, manufacturing processes, safety and/or other matters that could affect the availability or commercial potential of Fosmanogepix or any such other anti-infectives; the impact of COVID-19 on Pfizer’s business, operations and financial results; and competitive developments.

A further description of risks and uncertainties can be found in Pfizer’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and in its subsequent reports on Form 10-Q, including in the sections thereof captioned “Risk Factors” and “Forward-Looking Information and Factors That May Affect Future Results”, as well as in its subsequent reports on Form 8-K, all of which are filed with the U.S. Securities and Exchange Commission and available at www.sec.gov and www.pfizer.com.

* Excludes deaths attributed to COVID-19.

ⁱ Bongomin F et al J. Fungi 2017, 3, 57. Global and Multi-National Prevalence of Fungal Diseases-Estimate Precision. Available at: https://pubmed.ncbi.nlm.nih.gov/29371573/. Accessed April 2021.

ⁱⁱ Center for Disease Control and Prevention. Antifungal Resistance. Available at: https://www.cdc.gov/fungal/antifungal-resistance.html. Accessed April 2021.

ⁱⁱⁱ Global Burden of Disease Tool [Data set], University of Washington, Institute for Health Metrics and Evaluation, Global Health Data Exchange, 2020. Available at: http://ghdx.healthdata.org/gbd-results-tool. Accessed April 2021.

^iv World Health Organization. Top 10 Causes of Death. Available at: https://www.who.int/en/news-room/fact-sheets/detail/the-top-10-causes-of-death. Accessed April 2021.

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Pfizer Inc.

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KEYWORDS: New York United States North America

INDUSTRY KEYWORDS: Research Medical Supplies Infectious Diseases Hospitals Clinical Trials Biotechnology General Health Pharmaceutical Health Science

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April 28, 2021 6:47 am

Grifols and Andorran government will establish world-class immunology research hub to expand global knowledge of the immune system and develop therapeutics

– This flagship facility in the principality, the Pyrenees Immunology Research Center (PYIRC), will be one of the few immunology-dedicated research centers in Europe and will serve as an international reference center for the development of treatments for immune system disorders through translational and clinical expertise

– It aims to attract international multidisciplinary scientists and technicians who will also collaborate on initiatives including teams from other leading global research institutions

– Equipped with cutting-edge facilities and technology, the complex is expected to be completed during 2023 and will add to Grifols’ growing worldwide R+D+i footprint, currently involving more than 1,200 people in 10 research centers

– Grifols and Andorra Development and Investment (ADI) will incorporate a new company (joint venture) that will be owned by Grifols and ADI on an 80%-20% basis, respectively. The agreement will become effective pending relevant authorizations

PR Newswire

BARCELONA, Spain, April 28, 2021 /PRNewswire/ — Grifols (MCE: GRF, MCE: GRF.P, and NASDAQ: GRFS), a leading global producer of plasma-derived medicines with a history of more than 110 years contributing to improve the health and well-being of people, today announced it has signed an agreement with the government of Andorra through Andorra Development and Investment (ADI) to establish a global R+D+i hub to advance knowledge of the human immune system and investigate and develop new immune therapies.

The planned facility, the Pyrenees Immunology Research Center (PYIRC), will focus on developing treatments for immune system disorders that can result in diseases including autoimmunity disorders, cancer and emerging infectious diseases. It will also host and sponsor conferences, symposiums and educational programming on the subject matter as well as promote broader awareness of immunological pathologies.

When completed in 2023, this center will be one of only a few in Europe dedicated to immunology and is expected to attract international multidisciplinary scientists and technicians distinguished for their translational and clinical expertise. Their immunology research will also include collaborations with teams from other leading global research institutions.

To be located in the Andorran Pyrenees, the immunology research hub will be designed by Grifols Engineering and Grifols Innovation and New Technologies (GIANT), which have vast experience in creating advanced facilities for healthcare research and manufacturing. Best practices in environmentally respectful design and construction, including materials, will harmonize the campus with the natural surroundings. Efficient use of energy and water as well as leading technologies will also help ensure a sustainable footprint. From the outset, the objective is to secure the prestigious LEED certification (Leadership in Energy and Environmental Design).

Grifols, which has a growing research presence globally that involves more than 1,200 people dedicated to R+D+i in 10 centers, will draw on its deep-seated scientific expertise and laboratory management skills to run the new research center, which will be equipped with cutting-edge facilities and systems, including the latest bioinformatics and data analytical tools.

“Grifols is very pleased to build a world-class immunology R+D+i facility in Southern Europe in the green and inspirational environment of the Andorran Pyrenees. The center is destined to become an international hub to advance knowledge of the immune system and develop therapeutics to enhance people’s health and quality of life,” said Víctor Grifols Deu, coCEO of Grifols.

“The government of Andorra considers this initiative to be extremely positive, especially heading into the post-pandemic environment and as a response to the objectives included in the government’s roadmap to diversify the economy, strengthening its commitment to priority sectors such as biotechnology, research, technological advancement, innovation, attracting talent and developing high value-added activities,” said Xavier Espot, head of the government of Andorra.

Pending the relevant authorizations, Grifols, through GIANT, will own 80% of the joint venture created to develop and manage the new R+D+i center. The remainder will belong to the Andorran government through Andorra Development and Investment, the principality’s economic development agency.

Under the agreement and in alignment with the ownership structure, Grifols will have a majority of the new incorporated entity’s board of directors, with the remaining seats corresponding to the government of Andorra. The expected investment is in the range of €25 million for the construction of the center and approximately €7 million in annual operating costs to conduct research. Grifols will provide all needed financial support to build the center and develop the project.

Grifols retained Osborne Clarke Spain, S.L.P as legal advisors.

About Grifols

Grifols is a global healthcare company founded in Barcelona in 1909 committed to improving the health and well-being of people around the world. Its four divisions – Bioscience, Diagnostic, Hospital and Bio Supplies – develop, produce and market innovative solutions and services that are sold in more than 100 countries.

Pioneers in the plasma industry, Grifols operates a growing network of donation centers worldwide. It transforms collected plasma into essential medicines to treat chronic, rare and, at times, life-threatening conditions. As a recognized leader in transfusion medicine, Grifols also offers a comprehensive portfolio of solutions designed to enhance safety from donation to transfusion. In addition, the company supplies tools, information and services that enable hospitals, pharmacies and healthcare professionals to efficiently deliver expert medical care.

Grifols, with nearly 24,000 employees in more than 30 countries and regions, is committed to a sustainable business model that sets the standard for continuous innovation, quality, safety and ethical leadership.

In 2020, Grifols’ economic impact in its core countries of operation was EUR 7.5 billion. The company also generated 140,000 jobs, including indirect and induced.

The company’s class A shares are listed on the Spanish Stock Exchange, where they are part of the Ibex35 (MCE:GRF). Grifols non-voting class B shares are listed on the Mercado Continuo (MCE:GRF.P) and on the U.S. NASDAQ through ADRs (NASDAQ:GRFS).

For more information, please visit www.grifols.com

About Andorra Development and Investment

Andorra Development and Investment (ADI) is the economic promotion agency belonging to the government of Andorra. Its mission is to diversify and modernize the Andorran economy. Internationally, the ADI’s objectives include positioning and promoting Andorra as an open, modern, and attractive economy for foreign investment, in addition to welcoming and helping foreign investment get established. With respect to national efforts, ADI works to support Andorran businesses that want to grow and become international. For more information, please visit www.govern.ad or www.actua.ad .

LEGAL DISCLAIMER

The facts and figures contained in this report that do not refer to historical data are “future projections and assumptions”. Words and expressions such as “believe”, “hope”, “anticipate”, “predict”, “expect”, “intend”, “should”, “will seek to achieve”, “it is estimated”, “future” and similar expressions, insofar as they relate to the Grifols group, are used to identify future projections and assumptions. These expressions reflect the assumptions, hypotheses, expectations and predictions of the management team at the time of writing this report, and these are subject to a number of factors that mean that the actual results may be materially different. The future results of the Grifols group could be affected by events relating to its own activities, such as a shortage of supplies of raw materials for the manufacture of its products, the appearance of competitor products on the market, or changes to the regulatory framework of the markets in which it operates, among others. At the date of compiling this report, the Grifols group has adopted the necessary measures to mitigate the potential impact of these events. Grifols, S.A. does not accept any obligation to publicly report, revise or update future projections or assumptions to adapt them to events or circumstances subsequent to the date of writing this report, except where expressly required by the applicable legislation. This document does not constitute an offer or invitation to buy or subscribe shares in accordance with the provisions of the following Spanish legislation: Royal Legislative Decree 4/2015, of 23 October, approving recast text of Securities Market Law; Royal Decree Law 5/2005, of 11 March and/or Royal Decree 1310/2005, of 4 November, and any regulations developing this legislation. In addition, this document does not constitute an offer of purchase, sale or exchange, or a request for an offer of purchase, sale or exchange of securities, or a request for any vote or approval in any other jurisdiction. The information included in this document has not been verified nor reviewed by the external auditors of the Grifols group

View original content to download multimedia:http://www.prnewswire.com/news-releases/grifols-and-andorran-government-will-establish-world-class-immunology-research-hub-to-expand-global-knowledge-of-the-immune-system-and-develop-therapeutics-301278904.html

SOURCE Grifols, SA

April 28, 2021 6:43 am

Nokia ranked as number one in 5G patents

Press Release

Nokia ranked as
number one
in 5G patents

Independent study by PA Consulting confirms Nokia’s leadership in 5G Standard Essential Patents
The finding is the latest to rank Nokia number one for patents declared as essential for cellular standards, including 5G

28 April 2021

Espoo, Finland –
Nokia
today announced that i
t
has been
ranked as
number one
in 5G
patents
in an
independent study
.

The strength of Nokia’s industry leading 5G patent portfolio has once again been confirmed by an independent third party. In its study on Standard Essential Patents (published April 2021), independent analyst firm PA Consulting concluded that Nokia is number one for ownership of granted patents that the researchers found essential to 5G standards.

This is the second time Nokia’s leadership in 5G Standard Essential Patents has been confirmed by PA Consulting’s research. Nokia was ranked as number one in their previous study published in 2019. The analyst firm conducted their own technical analysis of the 5G patent landscape, investigating whether the patents are truly essential to the 5G standard, instead of relying on patent holders’ own raw declaration numbers.

Jenni Lukander, President of Nokia Technologies, said: “These independent findings reflect the significant contribution Nokia makes to developing industry standards, our continuous investment in R&D, and the strength of our patent portfolio. The study is also a reminder that you need to look at not just the number of patents but also the quality when assessing the strength of a patent portfolio.”

For over three decades, Nokia has been significantly contributing to the development of industry standards, holding a variety of leadership positions in major industry standardization bodies. In 5G standardization, Nokia is one of the most active contributors and drivers of key features. Several independent third-party studies have ranked Nokia among the top for ownership of patents that have been declared as essential to cellular standards, including 5G.

Nokia’s industry-leading patent portfolio is built on more than €130 billion invested in R&D since 2000 and is composed of around 20,000 patent families, including over 3,500 patent families declared essential to 5G.

Nokia contributes its inventions to open standards in return for the right to license them on fair, reasonable and non-discriminatory (FRAND) terms. Companies can license and use these technologies without the need to make their own substantial investments in R&D.

Disclaimer
: Reference to a study does not equate to Nokia’s unreserved endorsement.

Additional resources

Webpage: Licensing https://www.nokia.com/licensing/

About Nokia

We create technology that helps the world act together. As a trusted partner for critical networks, we are committed to innovation and technology leadership across mobile, fixed and cloud networks. We create value with intellectual property and long-term research, led by the award-winning Nokia Bell Labs. Adhering to the highest standards of integrity and security, we help build the capabilities needed for a more productive, sustainable and inclusive world.

For our latest updates, please visit us online www.nokia.com and follow us on Twitter @nokia.

Media Inquiries:

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Email: [email protected]