Market Newsdesk

April 29, 2021 4:22 pm

McKesson Declares Quarterly Dividend

McKesson Declares Quarterly Dividend

IRVING, Texas–(BUSINESS WIRE)–
The Board of Directors of McKesson Corporation (NYSE: MCK) yesterday declared a regular dividend of 42 cents per share of common stock. The dividend will be payable on July 1, 2021, to stockholders of record on June 1, 2021.

About McKesson Corporation

McKesson Corporation is a global leader in healthcare supply chain management solutions, retail pharmacy, community oncology and specialty care, and healthcare information solutions. McKesson partners with pharmaceutical manufacturers, providers, pharmacies, governments and other organizations in healthcare to help provide the right medicines, medical products and healthcare services to the right patients at the right time, safely and cost-effectively. United by our ICARE shared principles, our employees work every day to innovate and deliver opportunities that make our customers and partners more successful – all for the better health of patients. McKesson has been named a “Most Admired Company” in the healthcare wholesaler category by FORTUNE, a “Best Place to Work” by the Human Rights Campaign Foundation, and a top military-friendly company by Military Friendly. For more information, visit www.mckesson.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210429005856/en/

Holly Weiss, 972-969-9174 (Investors)

[email protected]

David Matthews, 214-952-0833 (Media)

[email protected]

KEYWORDS: United States North America Texas

INDUSTRY KEYWORDS: General Health Pharmaceutical Health Medical Supplies

MEDIA:

Logo

April 29, 2021 4:21 pm

XP Inc. Files Its Annual Report on Form 20-F for the Fiscal Year Ended December 31, 2020

XP Inc. Files Its Annual Report on Form 20-F for the Fiscal Year Ended December 31, 2020

SÃO PAULO–(BUSINESS WIRE)–XP Inc. (Nasdaq: XP), or XP, a leading, technology-driven platform and a trusted provider of low-fee financial products and services in Brazil, announced today that it has filed with the U.S. Securities and Exchange Commission (the “SEC”) its Annual Report on Form 20-F for the fiscal year ended December 31, 2020.

The report is available on the SEC’s website, at www.sec.gov, and on XP’s Investor Relations website, at https://investors.xpinc.com/.

Shareholders can obtain copies of XP’s Annual Report on Form 20-F, free of charge, by making a request within a reasonable period of time to XP’s Investor Relations Department.

About XP

XP is a leading, technology-driven platform and a trusted provider of low-fee financial products and services in Brazil. XP’s mission is to disintermediate the legacy models of traditional financial institutions by:

Educating new classes of investors;
Democratizing access to a wider range of financial services;
Developing new financial products and technology applications to empower clients; and
Providing high-quality customer service and client experience in the industry in Brazil.

XP provides customers with two principal types of offerings, (i) financial advisory services for retail clients in Brazil, high-net-worth clients, international clients and corporate and institutional clients, and (ii) an open financial product platform providing access to over 800 investment products including equity and fixed income securities, mutual and hedge funds, structured products, life insurance, pension plans, real-estate investment funds (REITs) and others from XP, its partners and competitors.

Forward Looking Statements

This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made as of the date they were first issued and were based on current expectations, estimates, forecasts and projections as well as the beliefs and assumptions of management. Words such as “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “goals,” “estimate,” “potential,” “predict,” “may,” “will,” “might,” “could,” “intend,” variations of these terms or the negative of these terms and similar expressions are intended to identify these statements. Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond XP’s control.

XP’s actual results could differ materially from those stated or implied in forward-looking statements due to several factors, including but not limited to: competition, change in clients, regulatory measures, a change the external forces among other factors.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210429005816/en/

Investor Contact:

André Martins

Antonio Guimarães

[email protected]

IR Website:

investors.xpinc.com

KEYWORDS: United States South America North America Brazil

INDUSTRY KEYWORDS: Software Technology Professional Services Finance

MEDIA:

April 29, 2021 4:21 pm

Standard AVB Financial Corp. Announces First Quarter Earnings and a Quarterly Dividend Payment

MONROEVILLE, Pa., April 29, 2021 (GLOBE NEWSWIRE) — Standard AVB Financial Corp. (the “Company”) – (NASDAQ: STND), the holding company for Standard Bank, PaSB, announced earnings for the quarter ended March 31, 2021 of $2.1 million, or $0.46 per basic share, compared to $1.1 million, or $0.24 per basic share, for the quarter ended March 31, 2020. Net income for the quarter was impacted by merger-related expenses of $151,000 ($121,000 after tax) related to the pending merger with Dollar Mutual Bancorp. Excluding the after tax impact of the merger-related expenses, net income would have been $2.2 million or $0.46 per basic share, for the quarter ended March 31, 2021. The increase in earnings resulted primarily from changes in the net equity securities fair value adjustment period over period and decreases in interest expense and the provision for loan losses, partially offset by a decrease in interest income and an increase in income tax expense.

The Company’s annualized return on average assets and average equity were 0.82% and 5.92%, respectively, (0.87% and 6.26%, respectively, excluding the merger-related expenses) for the quarter ended March 31, 2021 compared to 0.46% and 3.14%, respectively, for the quarter ended March 31, 2020.

The Company’s board of directors declared a quarterly cash dividend of $0.221 per share on the Company’s common stock. The dividend will be payable to stockholders of record as of May 10, 2021 and will be paid on May 24, 2021.

On September 25, 2020, the Company and Dollar Mutual Bancorp jointly announced the signing of a definitive merger agreement pursuant to which Dollar Mutual Bancorp will acquire the Company in an all cash transaction for an aggregate purchase price of $158 million. The shareholders of the Company approved the merger on January 19, 2021 and the transaction is expected to close in the first half of 2021, pending regulatory approvals and the satisfaction or waiver of other customary closing conditions.

Andrew W. Hasley, President & CEO, stated, “We are pleased with the financial results we have been able to achieve while continuing to navigate through such a challenging economic and operating environment. The continued historically low interest rates have resulted in a contraction of our net interest margin from pre-pandemic levels; however, net interest income has increased. Non-interest income remains diversified, noninterest expenses have been prudently managed and credit quality has remained strong. We have continued to support our customer base and community all while maintaining socially responsible practices and being responsive to changes required as a result of the ongoing guidance and mandates from the federal, state and local government regarding COVID-19.

The Company ended March with an allowance for loan losses sufficient to absorb credit losses and an abundance of liquidity and regulatory capital well in excess of the prescribed minimums. Taking all of this into consideration, the Company made the decision to maintain our dividend.”

CONSOLIDATED BALANCE SHEET & ASSET QUALITY OVERVIEW

Total assets was $1.1 billion at both March 31, 2021 and December 31, 2020. During the quarter ended March 31, 2021, there was an increase in cash and cash equivalents of $38.8 million, or 76.8%, partially offset by a decrease in loans receivable of $23.3 million, or 3.2%, and a decrease in investment securities of $2.1 million, or 1.1%. The increase in cash and cash equivalents was also impacted by an increase in deposits during the period which is further discussed below. The decrease in loans receivable was the result of loan payoffs and amortization exceeding loan production during the period.

Total deposits at March 31, 2021 increased by $23.9 million, or 3.0%, to $833.1 million from $809.2 million at December 31, 2020. The increase resulted from a $25.4 million, or 4.2%, increase in demand and savings accounts partially offset by a $1.5 million, or 0.8%, decrease in time deposits. The increase in demand and savings accounts was primarily the result of inflows from several sources during the period including additional government stimulus, second round Paycheck Protection Program (“PPP”) loan proceeds, and maturing time deposits. Borrowed funds decreased by $10.8 million, or 11.7% to $82.2 million at March 31, 2021 from $93.0 million at December 31, 2020. The decrease was due to the maturity and repayment of Federal Home Loan Bank advances during the period.

Stockholders’ equity decreased by $894,000, or 0.6% to $145.1 million at March 31, 2021 from $146.0 million at December 31, 2020. The decrease was the result of a decrease in accumulated other comprehensive income and dividends paid during the period offset by net income earned.

Non-performing loans at March 31, 2021 were $4.6 million, or 0.64% of total loans compared to $5.0 million, or 0.67% of total loans at December 31, 2020. The Company’s allowance for loan losses increased $138,000, or 1.8%, to $8.0 million at March 31, 2021. Based upon Management’s understanding of the credit quality of the loan portfolio, the Company has provided sufficient reserves for possible losses in the portfolio.

The Company is a qualified Small Business Administration (“SBA”) lender and was automatically authorized to originate PPP loans. The initial PPP loan program closed on August 8, 2020. The Company is continuing to work with customers to submit the required information to the SBA in order to receive the maximum amount of loan forgiveness on those loans. To date, the Company has received loan forgiveness on 165 loans totaling over $18.0 million out of the 428 loans totaling over $42.0 million approved under the first round of the PPP program. On December 27, 2020, an additional round of PPP funding was established. The Company is continuing to participate in the program, which opened mid-January for new loan applications and remains open through May 31, 2021. The Company has processed 93 applications totaling over $8.1 million under the second round of the PPP program.

The Company has continued to provide assistance to individuals and small business clients directly impacted by the COVID-19 pandemic by allowing borrowers to defer loan payments. As of March 31, 2021, the Bank had payment deferrals for eight commercial loans totaling $9.2 million and five consumer loans totaling $1.0 million. All of these loans were initially provided a deferral period of 90 days and, if necessary, additional deferral periods were provided upon request. The Company remains fully committed to serving our customers and communities through this uncertain time.

It is anticipated that certain industries will continue to suffer losses as a result of the COVID-19 pandemic. The Bank’s loan portfolio consists of commercial real estate, commercial business and residential loans that may be primarily impacted. The largest commercial loan concentrations are to the lessors of residential properties and the lessors of nonresidential properties representing 36.4% and 24.5% of the commercial loan portfolio at March 31, 2021, respectively. Additionally, the Bank has approximately $15.7 million in total exposure to the hotel sector.

OPERATING RESULTS OVERVIEW

Net interest income was $7.2 million for the three months ended March 31, 2021 compared to $6.8 million for the three months ended March 31, 2020. The net interest margin for the three months ended March 31, 2021 was 2.96%, compared to 3.02% for the same period in the prior year. The increase in net interest income for the quarter was primarily due to a decrease in both the balance and cost of interest-bearing liabilities as well as an increase in the balance of interest-earning assets partially offset by a decrease in the yield on interest-earning assets.

A provision for loan losses of $150,000 was recorded for the three months ended March 31, 2021, compared to $550,000 for the three months ended March 31, 2020. The provision for the prior year quarter was impacted by a number of things including increases in several qualitative factors, some of which were directly impacted by the COVID-19 pandemic, an increase in loan balances included in the allowance calculation and increased reserves required on a few loans which had experienced a deterioration in quality.

Noninterest income totaled $1.2 million for the quarter ended March 31, 2021, compared to $535,000 for the quarter ended March 31, 2020. The increase in noninterest income for the three months ended March 31, 2021 was primarily the result of a $730,000 change in the net equity securities fair value adjustment partially offset by decreases in investment management fees and service charges.

Noninterest expenses totaled $5.6 million for the quarter ended March 31, 2021, compared to $5.5 million for the quarter ended March 31, 2020. Excluding merger-related expenses, noninterest expenses totaled $5.4 million for the quarter ended March 31, 2021. The decrease in noninterest expenses, excluding merger-related expenses, for the quarter ended March 31, 2021 was primarily the result of a decrease in compensation expenses partially offset by an increase in federal deposit insurance. The higher federal deposit insurance during the period was the result of the elimination of the small bank credits which had been applied in the prior period and have since been fully utilized.

Income tax expense totaled $528,000 for the quarter ended March 31, 2021, compared to $194,000 for the quarter ended March 31, 2020. The increase in income tax expense was primarily the result of an increase in taxable income as well as a higher effective tax rate for the period.

Standard AVB Financial Corp., with total assets of $1.1 billion at March 31, 2021, is the parent company of Standard Bank, PaSB, a Pennsylvania chartered savings bank that operates 17 offices serving individuals and small to mid-sized businesses in Allegheny, Westmoreland and Bedford Counties, in Pennsylvania and Allegany County in Maryland. Standard Bank is a member of the FDIC and an Equal Housing Lender.

This news release may contain a number of forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors. In addition, the COVID-19 pandemic is having an adverse impact on the Company, its customers and the communities it serves. Given its ongoing and dynamic nature, it is difficult to predict the full impact of the COVID-19 outbreak on our business. The extent of such impact will depend on future developments, which are highly uncertain, including when the coronavirus can be controlled and abated and when and how the economy may be reopened or remain reopened. The Company undertakes no obligation to update these forward-looking statements to reflect events or circumstances that occur after the date on which such statements were made.


Standard AVB Financial Corp.
Financial Highlights
(Dollars in thousands, except per share data)
(Unaudited)

OPERATIONS DATA:	Three Months Ended March 31,
	2021			2020
Interest and Dividend Income	$	8,582		$	9,036
Interest Expense		1,375			2,207
Net Interest Income		7,207			6,829
Provision for Loan Losses		150			550
Net Interest Income after Provision for Loan Losses		7,057			6,279
Noninterest Income		1,170			535
Noninterest Expenses		5,576			5,510
Income before Income Tax Expense		2,651			1,304
Income Tax Expense		528			194
Net Income	$	2,123		$	1,110

Earnings Per Share – Basic	$	0.46		$	0.24
Earnings Per Share – Diluted	$	0.46		$	0.24
Annualized Return on Average Assets		0.82	%		0.46	%
Average Assets	$	1,048,584		$	975,543
Annualized Return on Average Equity		5.92	%		3.14	%
Average Equity	$	145,423		$	141,938
Efficiency Ratio		63.65	%		66.66	%
Net Interest Spread		2.71	%		2.70	%
Net Interest Margin		2.96	%		3.02	%
Annualized Noninterest Expense to Average Assets		2.16	%		2.27	%

FINANCIAL CONDITION DATA:	March 31,			December 31,
	2021			2020
Total Assets	$	1,064,615		$	1,051,588
Cash and Cash Equivalents		89,310			50,513
Investment Securities		186,214			188,279
Loans Receivable, Net		711,407			734,752
Deposits		833,146			809,240
Borrowed Funds		82,150			92,979
Total Stockholders’ Equity		145,057			145,951

Book Value Per Share	$	30.39		$	30.57
Tangible Book Value Per Share	$	24.70		$	24.86

Allowance for Loan Losses	$	7,979		$	7,841
Non-Performing Loans	$	4,638		$	4,965
Allowance for Loan Losses to Total Loans		1.11	%		1.06	%
Allowance for Loan Losses to Non-Performing Loans		172.04	%		157.93	%
Non-Performing Assets to Total Assets		0.47	%		0.52	%
Non-Performing Loans to Total Loans		0.64	%		0.67	%

STANDARD AVB FINANCIAL CORP.
RECONCILIATION OF CERTAIN NON-GAAP FINANCIAL MEASURES

EXPLANATION OF OUR USE OF NON-GAAP MEASURES

In addition to the results of operations presented in accordance with generally accepted accounting principles (GAAP), our management uses, and this exhibit contains, certain non-GAAP financial measures. We believe these non-GAAP financial measures provide information useful to investors in understanding our underlying operational performance, our business and performance trends, and facilitate comparisons with the performance of others in the financial service industry.

Although we believe these non-GAAP financial measures enhance investors’ understanding of our business and performance, they should not be considered an alternative to GAAP. The reconciliation of these non-GAAP financial measures from GAAP to non-GAAP follows.


Standard AVB Financial Corp.
Reconciliation of Certain Non-GAAP Financial Measures
(Dollars in thousands, except per share data)
(Unaudited)

Noninterest expense, net income, basic earnings per share, diluted earnings per share, return on average assets and return on average equity excluding merger-related expenses are all non-GAAP measures. The following table reconciles noninterest expense to noninterest expense excluding merger-related expenses and net income to net income excluding merger-related expenses. Additionally, basic earnings per share, diluted earnings per share, return on average assets and return on average equity utilizing both net income and net income excluding merger-related expenses are presented for the respective periods:

	Three Months Ended March 31,
	2021			2020

Noninterest Expense (GAAP)	$	5,576		$	5,510
Merger-related expenses (GAAP)		(151	)		–
Noninterest expense, excluding merger-related expenses	$	5,425		$	5,510

Net Income (GAAP)	$	2,123		$	1,110
After tax merger-related expenses (GAAP)		121			–
Net income, excluding merger-related expenses	$	2,244		$	1,110

Earnings Per Share – Basic
GAAP	$	0.46		$	0.24
Excluding merger-related expenses	$	0.46		n/a

Earnings Per Share – Diluted
GAAP	$	0.46		$	0.24
Excluding merger-related expenses	$	0.46		n/a

Average Assets (GAAP)	$	1,048,584		$	975,543

Return on Average Assets
GAAP		0.82	%		0.46	%
Excluding merger-related expenses		0.87	%	n/a

Average Equity (GAAP)	$	145,423		$	141,938

Return on Average Equity
GAAP		5.92	%		3.14	%
Excluding merger-related expenses		6.26	%	n/a

Tangible book value per common share is a non-GAAP measure and is calculated based on tangible book value divided by period-end common shares outstanding. The following tables reconcile book value and book value per share to tangible book value and tangible book value per share for the periods indicated:

	March 31, 2021			December 31, 2020

Total Stockholders’ Equity (GAAP)	$	145,057		$	145,951
Goodwill and Other Intangible Assets, Net		(27,138	)		(27,247	)
Tangible Book Value	$	117,919		$	118,704

Common Shares Outstanding		4,773,716			4,773,995

Book Value Per Share (GAAP)	$	30.39		$	30.57
Goodwill and Other Intangible Assets, Net Per Share		(5.68	)		(5.71	)
Tangible Book Value Per Share	$	24.70		$	24.86

CONTACTS:
Andrew W. Hasley	Timothy K. Zimmerman	Susan A. Parente
President	Senior Executive Vice President	Executive Vice President
Chief Executive Officer	Chief Operating Officer	Chief Financial Officer
412.856.0363	412.856.0363	412.856.0363

April 29, 2021 4:21 pm

voxeljet AG Schedules First Quarter 2021 Financial Results Release and Conference Call

voxeljet AG Schedules First Quarter 2021 Financial Results Release and Conference Call

FRIEDBERG, Germany–(BUSINESS WIRE)–
voxeljet AG (NASDAQ:VJET) (the “Company” or “voxeljet”), a leading provider of high-speed, large-format 3D printers and on-demand parts services to industrial and commercial customers, today announced that it will release its financial results for the first quarter 2021 after the closing of the financial markets on Thursday, May 13^th.

The company will host a conference call and webcast to review the results for the quarter on Friday, May 14^th at 8:30 a.m. Eastern Time. Participants from voxeljet will include its Chief Executive Officer, Dr. Ingo Ederer, and its Chief Financial Officer, Rudolf Franz, who will provide a general business update and respond to investor questions.

Interested parties may access the live audio broadcast by dialing 1-877-705-6003 in the United States/Canada, or 1-201-493-6725 for international, Conference Title “voxeljet AG First Quarter 2021 Financial Results Conference Call”. Investors are requested to access the call at least five minutes before the scheduled start time in order to complete a brief registration. An audio replay will be available approximately two hours after the completion of the call at 1-844-512-2921 or 1-412-317-6671, Replay Conference ID number 13719036. The recording will be available for replay through May 21^st, 2021. A live webcast of the call will also be available on the investor relations section of the Company’s website. Please go to the website https://event.on24.com/wcc/r/3081448/AD48E240A166DDAE5AD9C9BD2844E9EB at least fifteen minutes prior to the start of the call to register, download and install any necessary audio software. A replay will also be available as a webcast on the investor relations section of the Company’s website.

About voxeljet

voxeljet’s (NASDAQ: VJET) roots reach back to the year 1995 with the first successful dosing of UV-resins. In the context of a “hidden” project, initial 3D-printing tests are performed at the Technical University Munich. Our company was founded on May 5, 1999 as a spin-off from TUM in Munich with a clear vision in mind: to establish a new manufacturing standard by developing new generative processes for the series-production of complex components using 3D printing. In the beginning, operations are launched with four employees at the TUM. Today, we are a globally acting, leading provider of high-speed, large-format 3D printers and on-demand 3D printed parts to industrial and commercial customers. Components manufactured with the help of our technology are flying in space, make mobility more efficient and the production of new engineering solutions possible. For more information, visit www.voxeljet.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210429005001/en/

Investors and Media

Johannes Pesch

Director, Investor Relations and Business Development

[email protected]

+49-821-7483-172

KEYWORDS: Germany Europe

INDUSTRY KEYWORDS: Engineering Chemicals/Plastics Automotive Manufacturing Technology Aerospace Manufacturing Hardware

MEDIA:

Logo

April 29, 2021 4:21 pm

Full House Resorts Announces First Quarter Earnings Release Date

LAS VEGAS, April 29, 2021 (GLOBE NEWSWIRE) — Full House Resorts (NASDAQ: FLL) announced that it will report its first quarter 2021 financial results on Monday, May 10, 2021, followed by a conference call at 4:30 p.m. ET (1:30 p.m. PT). Investors can access the live audio webcast from the Company’s website at www.fullhouseresorts.com under the investor relations section. The conference call can also be accessed by dialing (866) 248-8441 or, for international callers, (323) 289-6581.

A replay of the conference call will be available shortly after the conclusion of the call through May 24, 2021. To access the replay, please visit www.fullhouseresorts.com. Investors can also access the replay by dialing (844) 512-2921 or, for international callers, (412) 317-6671 and using the passcode 8858326.

Forward-looking Statements

This press release may contain statements by Full House Resorts, Inc. that are “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Additional information concerning potential factors that could affect our financial condition and results of operations is included in the reports we file with the SEC, including, but not limited to, our Form 10-K for the most recently ended fiscal year and our other periodic reports filed with the SEC. We are under no obligation to (and expressly disclaim any such obligation to) update or revise our forward-looking statements as a result of new information, future events or otherwise, except as otherwise required by law. Actual results may differ materially from those indicated in the forward-looking statements.

About Full House Resorts, Inc.

Full House Resorts owns, leases, develops and operates gaming facilities throughout the country. The Company’s properties include Silver Slipper Casino and Hotel in Hancock County, Mississippi; Bronco Billy’s Casino and Hotel in Cripple Creek, Colorado; Rising Star Casino Resort in Rising Sun, Indiana; Stockman’s Casino in Fallon, Nevada; and Grand Lodge Casino, located within the Hyatt Regency Lake Tahoe Resort, Spa and Casino in Incline Village, Nevada. The Company is currently constructing Chamonix Casino Hotel, a new luxury hotel and casino in Cripple Creek, Colorado, and is one of three finalists for consideration by the Illinois Gaming Board to develop a casino in Waukegan, Illinois. For further information, please visit www.fullhouseresorts.com.

Contact:
Lewis Fanger, Chief Financial Officer
Full House Resorts, Inc.
(702) 221-7800
www.fullhouseresorts.com

April 29, 2021 4:21 pm

Idera Pharmaceuticals Reports First Quarter 2021 Financial Results and Provides Corporate Update

EXTON, Pa., April 29, 2021 (GLOBE NEWSWIRE) — Idera Pharmaceuticals, Inc. (“Idera” or the “Company”) (Nasdaq: IDRA) today reported its financial and operational results for the first quarter ended March 31, 2021.

“Despite the disappointing objective response rate (ORR) results from ILLUMINATE-301, our Phase 3 trial in anti-PD-1 refractory advanced melanoma, we continue to explore the potential for tilsotolimod to enhance patients’ immune systems,” stated Vincent Milano, Idera’s Chief Executive Officer. “We are evaluating our next steps regarding continuation of ILLUMINATE-301 toward its overall survival (OS) endpoint. We also continue to enroll and treat patients in ILLUMINATE-206, our Phase 2 study in microsatellite-stable colorectal cancer (MSS-CRC).”

Continued Mr. Milano, “In addition, we are very active in our business development efforts to identify and secure new development- or commercial-stage assets to enhance our portfolio, and we believe that our current cash position is strong.”

ILLUMINATE (tilsotolimod) Clinical Development

ILLUMINATE-301: The Company reported in March 2021 that it did not meet its primary endpoint of ORR from its randomized phase 3 trial of tilsotolimod in combination with ipilimumab versus ipilimumab alone in patients with anti-PD-1 refractory advanced melanoma. Patient status continues to be monitored in follow-up stages of the trial.

ILLUMINATE-206: Enrollment continues in the Company’s Phase 2, open-label, multicohort, multicenter study to test the safety and effectiveness of tilsotolimod in combination with ipilimumab and nivolumab for the treatment of solid tumors, beginning with MSS-CRC.

Initial safety run-in of 10 patients, which included ipilimumab at 1 mg/kg every 8 weeks and nivolumab at 3 mg/kg every 2 weeks, showed that the regimen was generally well tolerated.
Changes in the study design intended to improve potential outcomes in this patient population include increasing ipilimumab dosing frequency to every 3 weeks and limiting the number of allowed prior lines of treatment to 2.
Data from the next 10 patients under the modified study design is anticipated in the fourth quarter of 2021.

Corporate Update Since December 2020

In February 2021, the Company entered into a collaboration and option agreement with Scriptr Global, Inc. to research, develop, and potentially commercialize gene therapy candidates for myotonic dystrophy 1 (DM1) and Friedrich’s Ataxia (FA).
The Company received $16.3 million in net proceeds from its equity distribution agreement and equity line of credit.
Considering the data related to ILLUMINATE-301’s ORR endpoint, in April 2021 the Company initiated a reduction in force that will impact approximately 50% of our workforce by May 31, 2021. The decision was made to better align our workforce to our needs in ongoing tilsotolimod and business development activities.
The Company’s Board of Directors (the “Board”) has elected current Board member Michael Dougherty as the Chair of the Board, effective April 28, 2021. He succeeds James Geraghty, who initiated this transition in the interest of Board leadership refreshment after serving as our Board Chair since 2013. Mr. Geraghty is planning to continue to serve as a non-executive director on our Board.

“I want to thank Jim for his tireless leadership over the last 8 years and am looking forward to his continued contributions to our Board,” stated Mr. Milano. “I’m also grateful to have Mike step into this broader leadership role on our Board as we take Idera forward.”

First Quarter Financial Results
Research and development expenses for the three months ended March 31, 2021 totaled $6.9 million, compared to $9.5 million for the same period in 2020. General and administrative expense for the three months ended March 31, 2021 totaled $3.2 million compared to $3.6 million for the same period in 2020. Additionally, during the three months ended March 31, 2021 and 2020, we recorded a $7.0 million and $1.1 million non-cash warrant revaluation gain, respectively, and a $118.8 million and $20.7 million non-cash future tranche right revaluation gain, respectively, related to securities issued in connection with our December 2019 private placement transaction.

As a result of the factors above, net income for the three months ended March 31, 2021 was $115.7 million, compared to net income of $8.8 million for the same period in 2020. Net income applicable to common stockholders for the three months ended March 31, 2021 was $109.6 million, or $2.66 per basic share, compared to net income applicable to common stockholders of $8.2 million, or $0.27 per basic share, for the same period in 2020. On a diluted basis, net loss applicable to common stockholders for the three months ended March 31, 2021 was $10.0 million, or $0.14 per diluted share, compared to net income applicable to common stockholders of $8.0 million, or $0.22 per diluted share, for the same period in 2020. Excluding the non-cash gain of approximately $125.8 million and $21.8 million for the three months ended March 31, 2021 and 2020, respectively, related to the securities issued in connection with the December 2019 private placement transaction, net loss applicable to common stockholders was $10.0 million, or $0.24 per basic and diluted share, and $13.0 million, or $0.43 per basic and diluted share, respectively (calculated based upon the basic weighted-average number of common shares, due to the antidilutive effect of net loss).

About Idera Pharmaceuticals
Harnessing the approach of the earliest researchers in immunotherapy and the Company’s vast experience in developing proprietary immunology platforms, Idera’s lead development program is focused on priming the immune system to play a more powerful role in fighting cancer, ultimately increasing the number of people who can benefit from immunotherapy. Idera also continues to focus on the acquisition, development, and ultimate commercialization of drug candidates for both oncology and rare disease indications characterized by small, well-defined patient populations with serious unmet needs. To learn more about Idera, visit IderaPharma.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included or incorporated in this press release, including statements regarding the Company’s strategy, financial position, funding for continued operations, cash reserves, projected costs, prospects clinical trials and related endpoints, plans, and objectives of management, are forward-looking statements. The words “believes,” “anticipates,” “estimates,” “plans,” “expects,” “intends,” “may,” “could,” “should,” “potential,” “likely,” “projects,” “continue,” “will,” “schedule,” and “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements are predictions based on the Company’s current expectations and projections about future events and various assumptions. Idera cannot guarantee that it will actually achieve the plans, intentions, or expectations disclosed in its forward-looking statements and you should not place undue reliance on the Company’s forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties, and other factors, which may be beyond Idera’s control, and which may cause the actual results, performance, or achievements of the Company to be materially different from future results, performance, or achievements expressed or implied by such forward-looking statements. There are a number of important factors that could cause Idera’s actual results to differ materially from those indicated or implied by its forward-looking statements including, without limitation: whether the Company’s cash resources will be sufficient to fund the Company’s continuing operations and the further development of the Company’s programs; whether topline results from a clinical trial will be predictive of the final results of the trial; whether results obtained in preclinical studies and clinical trials will be indicative of the results that will be generated in future clinical trials, including in clinical trials in different disease indications; whether products based on Idera’s technology will advance into or through the clinical trial process when anticipated or at all or warrant submission for regulatory approval; whether such products will receive approval from the U.S. Food and Drug Administration or equivalent foreign regulatory agencies; whether, if the Company’s products receive approval, they will be successfully distributed and marketed; whether the Company’s collaborations will be successful; and the impact of public health crises, including the novel coronavirus (COVID-19) global pandemic. All forward-looking statements included in this release are made as of the date hereof, and are expressly qualified in their entirety by this cautionary notice, including, without limitation, those risks and uncertainties described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, and otherwise in the Company’s filings and reports filed with Securities and Exchange Commission. While Idera may elect to do so at some point in the future, the Company does not assume any obligation to update any forward-looking statements and it disclaims any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required by law.

Idera Pharmaceuticals, Inc.

Statements of Operations

(In thousands, except per share data)

	Three Months Ended
	March 31,
	2021			2020



Operating expenses:
Research and development	$	6,871		$	9,510
General and administrative		3,156			3,642

Total operating expenses		10,027			13,152

Loss from operations		(10,027	)		(13,152	)

Other income (expense)
Warrant revaluation gain		6,983			1,101
Future tranche right revaluation gain		118,803			20,711
Other income (expense), net		(21	)		157

Net income	$	115,738		$	8,817

Net income (loss) applicable to common stockholders
— basic	$	109,606		$	8,178
— diluted	$	(10,048	)	$	7,199

Net income (loss) per common share applicable to common stockholders
— basic	$	2.66		$	0.27
— diluted	$	(0.14	)	$	0.22

Weighted-average number of common shares used in computing net income (loss) per share applicable to common stockholders
— basic		41,193			30,300
— diluted		70,980			33,010

Idera Pharmaceuticals, Inc.

Balance Sheet Data

(In thousands)

	March 31,		December 31,
	2021		2020

Cash, cash equivalents, and short-term investments	$	44,541	$	37,728
Other assets		3,467		4,671
Total assets	$	48,008	$	42,399

Total liabilities	$	5,704	$	133,571
Total stockholders’ equity (deficit)		42,304		(91,172	)
Total liabilities and stockholders’ equity (deficit)	$	48,008	$	42,399

Idera Pharmaceuticals
Contacts:

Jill Conwell
Investor Relations &
Corporate Communications
Phone (484) 348-1675
[email protected]

John J. Kirby
Chief Financial Officer
Phone (484) 348-1627
[email protected]

April 29, 2021 4:21 pm

InfuSystem to Report First Quarter 2021 Financial Results on Thursday, May 6, 2021

Investor Conference Call to be held 9:00 a.m. Eastern Time

Rochester Hills, Michigan, April 29, 2021 (GLOBE NEWSWIRE) — InfuSystem Holdings, Inc. (NYSE American: INFU), (“InfuSystem” or the “Company), a leading national health care service provider, facilitating outpatient care for durable medical equipment manufacturers and health care providers, today announced that it will issue first quarter 2021 financial results on Thursday, May 6, 2021, before the market opens.

The Company will also conduct a conference call for all interested investors on Thursday, May 6, 2021, at 9:00 a.m. Eastern Time to discuss its financial results.

To participate in this call, please dial (888) 428-7458 or (862) 298-0702, or listen via a live webcast, which is available in the Investors section of the Company’s website at https://ir.infusystem.com/. A replay of the call will be available by visiting https://ir.infusystem.com/ for the next 90 days or by calling (888) 539-4649 or (754) 333-7735, confirmation code 155635, through May 13, 2021.

About

InfuSystem

Holdings, Inc.

InfuSystem Holdings, Inc. (NYSE American: INFU), is a leading national health care service provider, facilitating outpatient care for durable medical equipment manufacturers and health care providers. INFU services are provided under a two-platform model. The lead platform is Integrated Therapy Services (“ITS”), providing the last-mile solution for clinic-to-home healthcare where the continuing treatment involves complex durable medical equipment and services. The ITS segment is comprised of Oncology business, Pain Management, and Wound Therapy. The second platform, Durable Medical Equipment Services (“DME Services”), supports the ITS platform and leverages strong service orientation to win incremental business from its direct payor clients. The DME Services segment is comprised of direct payor rentals, pump and consumable sales, and biomedical services and repair. Headquartered in Rochester Hills, Michigan, the Company delivers local, field-based customer support and also operates Centers of Excellence in Michigan, Kansas, California, Massachusetts, Texas and Ontario, Canada.

# # #

CONTACT: 
Joe Dorame, Joe Diaz & Robert Blum
Lytham Partners, LLC
602-889-9700

April 29, 2021 4:21 pm

Rogers Corporation Reports First Quarter 2021 Results

Rogers Corporation Reports First Quarter 2021 Results

Advanced Mobility Growth And Market Recovery Drives Strong Financial Results

CHANDLER, Ariz.–(BUSINESS WIRE)–
Rogers Corporation (NYSE:ROG) today announced financial results for the first quarter of 2021.

“Rogers delivered strong first quarter sales and earnings, driven by the continued execution of our growth strategy and operational excellence initiatives,” stated Bruce D. Hoechner, Rogers’ President and CEO. “Accelerating demand for our innovative solutions in Advanced Mobility markets and a broad recovery in industrial demand were the primary catalysts for the sales increase. We continue to see robust market demand looking forward, but anticipate that global supply chain disruptions and the ongoing recovery of UTIS manufacturing will temper sales growth for the second quarter. We remain enthusiastic about the significant growth opportunities in Advanced Mobility and we are aggressively expanding capacity to capitalize on this opportunity, in addition to focusing on growth opportunities in our other core markets.”

Financial Overview

GAAP Results	Q1 2021	Q4 2020	Q1 2020
Net Sales ($M)	$229.3	$210.7	$198.8
Gross Margin	39.0%	38.3%	33.0%
Operating Margin	16.2%	9.5%	8.8%
Net Income ($M)	$31.2	$15.2	$13.3
Diluted Earnings Per Share	$1.66	$0.81	$0.71

Non-GAAP Results¹	Q1 2021	Q4 2020	Q1 2020
Adjusted Operating Margin	19.0%	18.4%	11.3%
Adjusted Net Income ($M)	$36.0	$29.7	$17.2
Adjusted Earnings Per Diluted Share	$1.92	$1.58	$0.92
Adjusted EBITDA ($M)	$59.8	$53.2	$33.4
Adjusted EBITDA Margin	26.1%	25.3%	16.8%
Free Cash Flow ($M)	$32.9	$39.9	$(2.5)

Net Sales by Operating Segment (dollars in millions)	Q1 2021	Q4 2020	Q1 2020
Advanced Electronics Solutions (AES)²	$131.9	$119.6	$111.3
Elastomeric Material Solutions (EMS)	$91.8	$86.6	$83.5
Other	$5.5	$4.5	$4.0

^{1 – A reconciliation of GAAP to non-GAAP measures is provided in the schedules included below}

^{2 – The AES business segment was formed in the first quarter of 2021 through the combination of the Advanced Connectivity Solutions (ACS) and Power Electronics Solutions (PES) businesses. Prior period consolidated financial statements have been reclassified to conform to the current year presentation.}

Q1 2021 Summary of Results

Net sales of $229.3 million increased 8.8% versus the prior quarter from higher sales in both the AES and EMS business units. AES net sales increased due to strong demand for ADAS applications and higher sales in the EV/HEV, clean energy, defense and wireless infrastructure markets. EMS net sales increased from strong demand in the EV/HEV, traditional automotive and general industrial markets, partially offset by a seasonal decline in portable electronics market sales. Currency exchange rates favorably impacted total company net sales in the first quarter of 2021 by $3.1 million compared to prior quarter net sales.

Gross margin was 39.0%, compared to 38.3% in the prior quarter. The increase in gross margin was due to higher volumes and operational cost savings, partially offset by commodity price increases, higher freight costs and unfavorable product mix.

Selling, general and administrative (SG&A) expenses decreased by $7.6 million from the prior quarter to $42.4 million. The decrease in SG&A expense was due to a reduction in accelerated intangible amortization expense, partially offset by higher compensation and benefits costs.

GAAP operating margin of 16.2% increased by 670 basis points sequentially primarily due to the improved gross margin and reduction in SG&A expenses and restructuring charges. Adjusted operating margin of 19.0% increased by 60 basis points versus the prior quarter, primarily as a result of improved gross margin.

GAAP earnings per diluted share were $1.66, compared to earnings per diluted share of $0.81 in the previous quarter. The increase in GAAP earnings resulted from higher net sales, improved gross margin and lower SG&A expense and restructuring related charges. On an adjusted basis, earnings were $1.92 per diluted share compared to adjusted earnings of $1.58 per diluted share in the prior quarter. The increase in adjusted earnings per diluted share resulted from higher net sales and improved gross margin.

Ending cash and cash equivalents were $199.1 million, an increase of $7.3 million versus the prior quarter. The Company generated free cash flow of approximately $32.9 million in the first quarter of 2021. Net cash provided by operating activities of $36.5 million was offset by $21.0 million of principal payments made on the outstanding borrowings under the Company’s revolving credit facility and capital expenditures of $3.6 million. At the end of the first quarter of 2021, cash exceeded borrowings by $195.1 million.

Financial Outlook

	Q2 2021
Net Sales ($M)	$230 to $240
Gross Margin	38.5% to 39.5%
Earnings Per Share	$1.58 to $1.73
Adjusted Earnings Per Share¹	$1.80 to $1.95

	2021
Effective Tax Rate	23% – 24%
Capital Expenditures ($M)	$70 to $80

1 – A reconciliation of GAAP to non-GAAP measures is provided in the schedules included below

About Rogers Corporation

Rogers Corporation (NYSE:ROG) is a global leader in engineered materials to power, protect and connect our world. Rogers delivers innovative solutions to help our customers solve their toughest material challenges. Rogers’ advanced electronic and elastomeric materials are used in applications for EV/HEV, automotive safety and radar systems, mobile devices, renewable energy, wireless infrastructure, energy-efficient motor drives, industrial equipment and more. Headquartered in Chandler, Arizona, Rogers operates manufacturing facilities in the United States, Asia and Europe, with sales offices worldwide.

Safe Harbor Statement

This release contains forward-looking statements, which concern our plans, objectives, outlook, goals, strategies, future events, future net sales or performance, capital expenditures, future restructuring, plans or intentions relating to expansions, business trends and other information that is not historical information. All forward-looking statements are based upon information available to us on the date of this release and are subject to risks, uncertainties and other factors, many of which are outside of our control, which could cause actual results to differ materially from those indicated by the forward-looking statements. Risks and uncertainties that could cause such results to differ include: the duration and impacts of the novel coronavirus global pandemic and efforts to contain its transmission and distribute vaccines, including the effect of these factors on our business, suppliers, customers, end users and economic conditions generally; failure to capitalize on, volatility within, or other adverse changes with respect to the Company’s growth drivers, including advanced mobility and advanced connectivity, such as delays in adoption or implementation of new technologies; uncertain business, economic and political conditions in the United States (U.S.) and abroad, particularly in China, South Korea, Germany, Hungary and Belgium, where we maintain significant manufacturing, sales or administrative operations; the trade policy dynamics between the U.S. and China reflected in trade agreement negotiations and the imposition of tariffs and other trade restrictions, including trade restrictions on Huawei Technologies Co., Ltd. (Huawei); fluctuations in foreign currency exchange rates; our ability to develop innovative products and the extent to which our products are incorporated into end-user products and systems and the extent to which end-user products and systems incorporating our products achieve commercial success; the ability of our sole or limited source suppliers to deliver certain key raw materials, including commodities, to us in a timely and cost-effective manner; intense global competition affecting both our existing products and products currently under development; business interruptions due to catastrophes or other similar events, such as natural disasters, war, terrorism or public health crises; failure to realize, or delays in the realization of anticipated benefits of acquisitions and divestitures due to, among other things, the existence of unknown liabilities or difficulty integrating acquired businesses; our ability to attract and retain management and skilled technical personnel; our ability to protect our proprietary technology from infringement by third parties and/or allegations that our technology infringes third party rights; changes in effective tax rates or tax laws and regulations in the jurisdictions in which we operate; failure to comply with financial and restrictive covenants in our credit agreement or restrictions on our operational and financial flexibility due to such covenants; the outcome of ongoing and future litigation, including our asbestos-related product liability litigation; changes in environmental laws and regulations applicable to our business; and disruptions in, or breaches of, our information technology systems. For additional information about the risks, uncertainties and other factors that may affect our business, please see our most recent annual report on Form 10-K and any subsequent reports filed with the Securities and Exchange Commission, including quarterly reports on Form 10-Q. Rogers Corporation assumes no responsibility to update any forward-looking statements contained herein except as required by law.

Conference call and additional information

A conference call to discuss the results for the first quarter of 2021 will take place today, Thursday, April 29, 2021 at 5pm ET.

A live webcast of the event and the accompanying presentation can be accessed on the Rogers Corporation website at https://www.rogerscorp.com/investors.

An audio replay of the conference call will be available from April 29, 2021 at approximately 8 pm ET through May 13, 2021 at 11:59 pm ET, by dialing 1-888-203-1112 from the United States, and entering the replay passcode of 9167045.

Additionally, the archived webcast will be available on the Rogers website at approximately 8 pm ET on April 29, 2021.

Additional information

Please contact the Company directly via email or visit the Rogers website.

(Financial statements follow)

*Condensed Consolidated Statements of Operations (Unaudited)*
	Three Months Ended
(DOLLARS AND SHARES IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)	March 31, 2021		March 31, 2020
Net sales	$	229,265	$	198,810
Cost of sales	139,766		133,180
Gross margin	89,499		65,630

Selling, general and administrative expenses	42,413		40,330
Research and development expenses	7,172		7,805
Restructuring and impairment charges	1,506		—
Other operating (income) expense, net	1,215		20
Operating income	37,193		17,475

Equity income in unconsolidated joint ventures	2,181		1,218
Other income (expense), net	2,968		(786)
Interest expense, net	(607)		(1,207)
Income before income tax expense	41,735		16,700
Income tax expense	10,517		3,441
Net income	$	31,218	$	13,259

Basic earnings per share	$	1.67	$	0.71

Diluted earnings per share	$	1.66	$	0.71

Shares used in computing:
Basic earnings per share	18,712		18,669
Diluted earnings per share	18,774		18,691

*Condensed Consolidated Statements of Financial Position (Unaudited)*
(DOLLARS AND SHARES IN THOUSANDS, EXCEPT PAR VALUE)	March 31, 2021		December 31, 2020
Assets
Current assets
Cash and cash equivalents	$	199,109	$	191,785
Accounts receivable, less allowance for doubtful accounts of $1,310 and $1,682	144,049		134,421
Contract assets	30,936		26,575
Inventories	106,706		102,360
Prepaid income taxes	2,854		2,960
Asbestos-related insurance receivables, current portion	2,986		2,986
Other current assets	19,140		13,088
Total current assets	505,780		474,175
Property, plant and equipment, net of accumulated depreciation of $364 and $366	267,041		272,378
Investments in unconsolidated joint ventures	14,948		15,248
Deferred income taxes	28,018		28,667
Goodwill	266,437		270,172
Other intangible assets, net of amortization	114,373		118,026
Pension assets	5,486		5,278
Asbestos-related insurance receivables, non-current portion	63,807		63,807
Other long-term assets	16,330		16,254
Total assets	$	1,282,220	$	1,264,005
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable	$	52,342	$	35,987
Accrued employee benefits and compensation	42,331		41,708
Accrued income taxes payable	7,629		8,558
Asbestos-related liabilities, current portion	3,615		3,615
Other accrued liabilities	23,645		21,641
Total current liabilities	129,562		111,509
Borrowings under revolving credit facility	4,000		25,000
Pension and other postretirement benefits liabilities	1,635		1,612
Asbestos-related liabilities, non-current portion	69,559		69,620
Non-current income tax	15,572		16,346
Deferred income taxes	9,229		8,375
Other long-term liabilities	11,808		10,788
Shareholders’ equity
Capital stock – $1 par value; 50,000 authorized shares; 18,712 and 18,677 shares issued and outstanding	18,712		18,677
Additional paid-in capital	150,004		147,961
Retained earnings	904,910		873,692
Accumulated other comprehensive loss	(32,771)		(19,575)
Total shareholders’ equity	1,040,855		1,020,755
Total liabilities and shareholders’ equity	$	1,282,220	$	1,264,005

Reconciliation of non-GAAP financial measures to the comparable GAAP measures

Non-GAAP financial measures:

This earnings release includes the following financial measures that are not presented in accordance with generally accepted accounting principles in the United States of America (“GAAP”):

(1) Adjusted operating margin, which the Company defines as operating margin excluding acquisition-related amortization of intangible assets and discrete items, such as acquisition and related integration costs, asbestos-related charges, gains or losses on the sale or disposal of property, plant and equipment, restructuring, severance, impairment and other related costs, UTIS fire charges, and the related income tax effect on these items (collectively, “discrete items”);

(2) Adjusted net income, which the Company defines as net income excluding amortization of acquisition intangible assets and discrete items;

(3) Adjusted earnings per diluted share, which the Company defines as earnings per diluted share excluding amortization of acquisition intangible assets, and discrete items divided by adjusted weighted average shares outstanding – diluted;

(4) Adjusted EBITDA, which the Company defines as net income excluding interest expense, net, income tax expense, depreciation and amortization, stock-based compensation expense, and discrete items;

(5) Adjusted EBITDA Margin, which the Company defines as the percentage that results from dividing Adjusted EBITDA by total net sales;

(6) Free cash flow, which the Company defines as net cash provided by operating activities less non-acquisition capital expenditures.

Management believes adjusted operating margin, adjusted net income, adjusted earnings per diluted share, adjusted EBITDA and adjusted EBITDA margin are useful to investors because they allow for comparison to the Company’s performance in prior periods without the effect of items that, by their nature, tend to obscure the Company’s core operating results due to potential variability across periods based on the timing, frequency and magnitude of such items. As a result, management believes that these measures enhance the ability of investors to analyze trends in the Company’s business and evaluate the Company’s performance relative to peer companies. Management also believes free cash flow is useful to investors as an additional way of viewing the Company’s liquidity and provides a more complete understanding of factors and trends affecting the Company’s cash flows. However, non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation from, or as alternatives to, financial measures prepared in accordance with GAAP. In addition, these non-GAAP financial measures may differ from, and should not be compared to, similarly named measures used by other companies. Reconciliations of the differences between these non-GAAP financial measures and their most directly comparable financial measures calculated in accordance with GAAP are set forth below.

Reconciliation of GAAP operating margin to adjusted operating margin*:

	2021	2020
Operating margin	Q1	Q4	Q1
GAAP operating margin	16.2%	9.5%	8.8%

Acquisition and related integration costs	—%	—%	0.2%
Asbestos-related charges	—%	(0.3)%	—%
Gain on sale or disposal of property, plant and equipment	—%	—%	—%
Restructuring, severance, impairment and other related costs	0.8%	1.9%	0.5%
UTIS fire charges	0.6%	—%	—%
Total discrete items	1.4%	1.6%	0.7%
Operating margin adjusted for discrete items	17.6%	11.1%	9.5%

Acquisition intangible amortization	1.4%	7.3%	1.8%

Adjusted operating margin	19.0%	18.4%	11.3%

*Percentages in table may not add due to rounding.

Reconciliation of GAAP net income to adjusted net income:

(amounts in millions)	2021		2020
Net income	Q1		Q4		Q1
GAAP net income	$	31.2	$	15.2	$	13.3

Acquisition and related integration costs	$	—	$	—	$	0.4
Asbestos-related charges	$	—	$	(0.7)	$	—
Gain on sale or disposal of property, plant and equipment	$	(0.1)	$	—	$	—
Restructuring, severance, impairment and other related costs	$	1.9	$	4.0	$	1.1
Acquisition intangible amortization	$	3.1	$	15.4	$	3.6
UTIS fire charges	$	1.3	$	—	$	—
Income tax effect of non-GAAP adjustments and intangible amortization	$	(1.5)	$	(4.3)	$	(1.2)
Adjusted net income	$	36.0	$	29.7	$	17.2

*Values in table may not add due to rounding.

Reconciliation of GAAP earnings per diluted share to adjusted earnings per diluted share*:

	2021		2020
Earnings per diluted share	Q1		Q4		Q1
GAAP earnings per diluted share	$	1.66	$	0.81	$	0.71

Acquisition and related integration costs	—		—		0.02
Asbestos-related charges	—		(0.03)		—
Gain on sale or disposal of property, plant and equipment	—		—		—
Restructuring, severance, impairment and other related costs	0.08		0.16		0.04
UTIS fire charges	0.05		—		—
Total discrete items	$	0.13	$	0.14	$	0.06

Earnings per diluted share adjusted for discrete items	$	1.79	$	0.95	$	0.77

Acquisition intangible amortization	$	0.13	$	0.64	$	0.15

Adjusted earnings per diluted share	$	1.92	$	1.58	$	0.92

*Values in table may not add due to rounding.

Reconciliation of GAAP net income to adjusted EBITDA*:

	2021		2020
(amounts in millions)	Q1		Q4		Q1
GAAP Net income	$	31.2	$	15.2	$	13.3

Interest expense, net	0.6		0.6		1.2
Income tax expense	10.5		8.1		3.4
Depreciation	7.2		7.4		7.3
Amortization	3.1		15.5		3.7
Stock-based compensation expense	4.0		3.2		3.1
Acquisition and related integration costs	—		—		0.4
Asbestos-related charges	—		(0.7)		—
Gain on sale or disposal of property, plant and equipment	(0.1)		—		—
Restructuring, severance, impairment and other related costs	1.9		3.9		1.1
UTIS fire charges	1.3		—		—
Adjusted EBITDA	$	59.8	$	53.2	$	33.4

*Values in table may not add due to rounding.

Calculation of adjusted EBITDA margin*:

	2021			2020
	Q1			Q4			Q1
Adjusted EBITDA (in millions)	$	59.8		$	53.2		$33.4
Divided by Total Net Sales (in millions)	229.3			210.7			198.8
Adjusted EBITDA Margin	26.1		%	25.3		%	16.8	%

*Values in table may not add due to rounding.

Reconciliation of net cash provided by operating activities to free cash flow*:

	2021		2020
(amounts in millions)	Q1		Q4		Q1
Net cash provided by operating activities	$	36.5	$	51.4	$	8.6
Non-acquisition capital expenditures	(3.6)		(11.4)		(11.2)
Free cash flow	$	32.9	$	39.9	$	(2.5)

*Values in table may not add due to rounding.

Reconciliation of GAAP earnings per diluted share to adjusted earnings per diluted share guidance for the 2021 first quarter:

	Guidance Q1 2021
GAAP earnings per diluted share	$1.48 – $1.63

Discrete items	$0.11

Acquisition intangible amortization	$0.13

Adjusted earnings per diluted share	$1.72 – $1.87

Reconciliation of GAAP earnings per diluted share to adjusted earnings per diluted share guidance for the second quarter of 2021:

	Guidance Q2 2021
GAAP earnings per diluted share	$1.58 – $1.73

Discrete items	$0.09

Acquisition intangible amortization	$0.13

Adjusted earnings per diluted share	$1.80 – $1.95

View source version on businesswire.com: https://www.businesswire.com/news/home/20210429005988/en/

Investor contact:

Steve Haymore

Phone: 480-917-6026

Email: [email protected]

Website address:http://www.rogerscorp.com

KEYWORDS: United States North America Arizona

INDUSTRY KEYWORDS: Other Manufacturing Technology Semiconductor Other Energy Aerospace Manufacturing Alternative Energy Energy Hardware

MEDIA:

April 29, 2021 4:21 pm

The Ensign Group Reports First Quarter 2021 Results; Raises 2021 Earnings Guidance

Conference Call and Webcast scheduled for tomorrow, April 30, 2021 at 10:00 am PT

SAN JUAN CAPISTRANO, Calif., April 29, 2021 (GLOBE NEWSWIRE) — The Ensign Group, Inc. (Nasdaq: ENSG), the parent company of the Ensign^(TM) group of companies, which provide post-acute healthcare services and invest in the long-term healthcare industry, primarily in skilled nursing and senior living facilities, announced record operating results for the first quarter of 2021, reporting GAAP diluted earnings per share of $0.86 for the quarter ended March 31, 2021. Ensign also reported a record adjusted earnings per share⁽¹⁾ of $0.87 for the quarter.

Highlights Include:

GAAP diluted earnings per share for the quarter was $0.86, representing an increase of 17.8% over the prior year quarter. Adjusted diluted earnings per share for the quarter was $0.87, an increase of 13.0%⁽¹⁾ over the prior year quarter.
Consolidated GAAP revenues for the quarter were $627.3 million and adjusted revenues for the quarter were $626.8 million⁽¹⁾, both increased by 6.4% over the prior year quarter.
Same store and transitioning skilled revenue improved by 7.6% and 43.7%, respectively, over the prior year quarter with an increase in skilled mix days of 4.4% and 9.9%, respectively.
Same store occupancy increased by 0.4% and transitioning occupancy increased by 1.6%, both sequentially over the fourth quarter.
Same store and transitioning managed care daily revenue improved by 15.9% and 24.2%, respectively with increases in Managed Care daily census of 17.5% and 25.5%, respectively, sequentially over the fourth quarter.
Transitioning and skilled services⁽²⁾ segment income increased to $88.9 million or 10.3% compared to prior year quarter and increased by $4.8 million or 5.7% sequentially over the fourth quarter.
Real estate⁽²⁾ segment income was $8.8 million for the quarter, an increase of 39.5% from prior year quarter. FFO was $13.5 million for the quarter, an increase of 24.7% from prior year quarter.
GAAP net income was $49.2 million for the quarter, an increase of 20.5% from prior year quarter. Adjusted net income for the quarter $49.6 million for the quarter, an increase of 15.5%⁽¹⁾ over the prior year quarter.

(1) See “Reconciliation of GAAP to Non-GAAP Financial Information”.

(2) Our Transitional and Skilled Services and Real Estate Segments are defined and outlined in Note 7 on Form 10-Q.

Operating Results

“We are very happy to report record results again this quarter. Thanks to early access to the vaccine, we have seen a significant reduction in the number of COVID-positive patients and staff in our operations throughout the first quarter and since with weekly resident and staff cases now in the single digits across our entire portfolio. As a result, our patients and caregivers have begun to enjoy an environment that, although certainly different in many ways, is starting to look and feel a lot more like pre-COVID times,” said Barry Port, Ensign’s Chief Executive Officer. “As they’ve shown so many times before, our locally-empowered leadership teams have yet again demonstrated the agility of our model as they have customized their strategies to meet the specific needs of the markets they serve. In doing so, our operations have separated themselves from a traditional nursing home care, remaining integral to the preservation of the healthcare continuum providing for complex medical needs. As they have done so, our operations have begun to see occupancies climb, particularly among our managed care patients. And now, as these operations emerge from the height of this crisis, they are poised to fill an even greater role than before as new standards for excellence in post-acute care,” he added.

Port noted that the Company saw a marked improvement in patient census, with a 3.4% and 18.6% increase in Medicaid and managed care average daily census, from the fourth quarter to first quarter for same store and transitioning portfolio, respectively. He also indicated that same store and transitioning managed care average daily census increased by 17.5% and 25.5%, respectively. “As we expected, as community spread of COVID has slowed, we have seen occupancies increase as the pent-up demand for healthcare services in our markets has continued to increase, while Medicare census has begun to trend toward pre-COVID levels. We expect the positive trend in occupancy to continue throughout the year, subject to some seasonality, as volumes in higher acute settings and managed care utilizations continue to increase. We look forward to continuing to work closely with our hospital and managed care partners in this new environment and to continue to demonstrate our ability to care for patients with the most complex medical needs,” he added.

Management increased the Company’s 2021 annual earnings guidance to $3.54 to $3.66 per diluted share, up from previous guidance of $3.44 to $3.56 per diluted share, and affirmed its previous annual revenue guidance of $2.62 billion to $2.69 billion. The midpoint of this 2021 earnings guidance represents an increase of approximately 15% over the Company’s 2020 results, which were 76% higher than 2019 results. Port noted that the increase comes from the strong results during the first quarter, positive trends in occupancy and the continuation of sequestration suspension, which provided some additional reimbursement that was not included in the original guidance. He added, “Our current health combined with our culture, proven local leadership strategy, healthy balance sheet, the enormous potential in our existing portfolio and the tremendous growth opportunities on the horizon, gives us confidence that we are well-positioned to not only rebound to our pre-COVID path but to accelerate our growth.”

The Company noted that the strong results in the quarter came from continued improvements in census and managed care skilled mix across the portfolio, company-wide cost saving initiatives, improved operational expense management, improved cash collections and the continuation of sequestration suspension and higher Medicaid funding in certain states. Commenting further on the quarter, Port said, “After one of the most challenging years in our history, our leaders are very excited to redirect the enormous energy spent on dealing with the pandemic towards continued improvement on the fundamentals that have made our operations so successful for so many years, including achieving high quality outcomes, driving occupancy, enhancing our clinical capabilities and managing costs. As we said last year, this pandemic arrived at our doorsteps at a time when our organization has never been stronger clinically and financially. As a result of being stretched to our limits in the face of this pandemic, we have learned many lessons and have become even stronger as our leaders and caregivers have made life-changing sacrifices on behalf of patients and their families. As we look out towards the near and long-term horizon as occupancies begin to climb towards pre-COVID levels and beyond, our existing portfolio truly has never had so much growth potential.”

Chief Financial Officer, Suzanne Snapper emphasized that the results for the quarter do not include any benefit related to CARES Act Provider Relief Funds and reminded investors that the Company continued to return all of the relief funds it received from the Government, which included approximately $9 million in provider grants in the first quarter of 2021 and approximately $2 million in April 2021. To date, all of the Provider Relief Funds, totaling over $152.9 million, have been returned to the government. She also indicated that in March the company repaid all remaining Medicare advance payments from the Centers for Medicare and Medicaid Services (CMS) of approximately $102 million.

Ms. Snapper also reported that the company’s liquidity remains strong with approximately $155.5 million of cash on hand and $342.4 million of available capacity under its line-of-credit facility, which also has a built-in expansion option, both as of March 31, 2021. She also noted that the company also has 94 owned assets, 74 of which are unlevered and add additional liquidity.

Growth and Real Estate Highlights

The Company’s affiliates continued to acquire skilled nursing operations in some of its most mature markets. “Our ability to continue to grow in the midst of a pandemic is a true testament to our local team of clinical and operational leadership and their experience, planning and preparation. After a brief pause in our acquisition efforts during the early months of the pandemic, our teams have shown their commitment to one of the things that drives our organization, which is to consistently and methodically acquire, not only in good times, but even when it would be easier to shut down growth while waiting out the storm,” Chad Keetch, Ensign’s Chief Investment Officer, said. The following skilled nursing operations were acquired during the quarter and since:

Golden Hill Post Acute, a 99-bed skilled nursing facility located in San Diego, CA;
St. Catherine Healthcare, a 99-bed skilled nursing facility located in Fullerton, CA;
Camino Healthcare, a 99-bed skilled nursing facility located in Hawthorne, CA;
San Pedro Manor, a 150-bed skilled nursing facility located in San Antonio, TX;
Boulder Canyon Health and Rehabilitation, a 140-bed skilled nursing facility located in Boulder, Colorado;
Berthoud Care and Rehabilitation, a 76-bed skilled nursing facility located in Berthoud, Colorado; and
South Valley Post Acute Rehabilitation, a 106-bed skilled nursing facility located in Denver, Colorado.

These additions bring Ensign’s growing portfolio to 235 healthcare operations, 22 of which also include senior living operations, across thirteen states. Ensign now owns 94 real estate assets, 64 of which it operates. “We are very excited about each of these hand-picked opportunities in some of our strongest markets and, because of the extra time we had to prepare given extra COVID protocols, we believe that each operation is poised to be a contributor to our results very soon,” Keetch said.

Keetch also noted that the pipeline for Ensign’s typical turnaround opportunities, in addition to some exciting strategic opportunities, remains strong. “We have plenty of capacity for what we still believe will be an attractive buyer’s market. We are actively looking to grow within our existing geographical footprint and will do so as we see significant advantages to adding strength in markets we know well, including some of our newer emerging markets as they continue to mature and prepare for growth,” he added.

Turning to the Company’s real estate portfolio, Keetch added, “We are pleased to announce that during the quarter we have made progress in our effort to select a structure that will allow us to better demonstrate the growing value in our owned real estate. Since our last call we have engaged advisors to help us determine the best path towards a structure inside of Ensign that highlights that value while not losing sight of our purpose-driven mission. We envision a structure that not only creates better visibility into the demonstrable value of our real estate but also will provide us with an efficient vehicle for future acquisitions of properties that could be operated by Ensign Affiliates or other third parties. We also seek a structure that will preserve the optionality that enables us to take advantage of private and public market conditions in order to maximize long term shareholder value. We are very excited about the new opportunities embedded in this chapter of our growth story and look forward, over the coming quarters, to updating you on our progress,” Keetch said.

The Company continues to provide additional disclosure on our new real estate segment, which is comprised of properties owned by us and leased to affiliated skilled nursing and senior living operations and 31 senior living operations that are leased to The Pennant Group, Inc. Keetch noted that each of these properties are subject to triple-net, long-term leases and generated rental revenue of $15.9 million for the quarter, of which $11.9 million was derived from Ensign affiliated operations. Also, for the first quarter of 2021 Ensign reported $13.5 million in FFO, which represents an increase of 24.7% over the prior year quarter of $10.8 million.

Also, during the quarter, the company paid a quarterly cash dividend of $0.0525 per share of Ensign common stock. Keetch noted that the company’s liquidity remains strong and that there are no current plans to suspend future dividends.

Conference Call

A live webcast will be held Friday, April 30, 2021 at 10:00 a.m. Pacific time (1:00 p.m. Eastern time) to discuss Ensign’s first quarter financial results. To listen to the webcast, or to view any financial or statistical information required by SEC Regulation G, please visit the Investors Relations section of Ensign’s website at http://investor.ensigngroup.net. The webcast will be recorded, and will be available for replay via the website until 5:00 p.m. Pacific time on Friday, June 4, 2021.

About Ensign™

The Ensign Group, Inc.’s independent operating subsidiaries provide a broad spectrum of skilled nursing and senior living services, physical, occupational and speech therapies and other rehabilitative and healthcare services at 235 healthcare facilities in Arizona, California, Colorado, Idaho, Iowa, Kansas, Nebraska, Nevada, South Carolina, Texas, Utah, Washington and Wisconsin. As part of its investment strategy, the Company also acquire, lease and own healthcare real estate to service the post-acute care continuum through acquisition and investment opportunities in healthcare properties. Ensign’s new business venture operating subsidiaries also offer several other post-acute-related services, including mobile x-ray, non-emergency transportation services and other consulting services also across several states. Each of these operations is operated by a separate, independent operating subsidiary that has its own management, employees and assets. References herein to the consolidated “company” and “its” assets and activities, as well as the use of the terms “we,” “us,” “its” and similar verbiage, are not meant to imply that The Ensign Group, Inc. has direct operating assets, employees or revenue, or that any of the facilities, the Service Center or the captive insurance subsidiary are operated by the same entity. More information about Ensign is available at http://www.ensigngroup.net.

Management’s guidance is based on diluted weighted average common shares outstanding of approximately 57.8 million and a 25% tax rate. In addition, the guidance assumes, among other things, normalized health insurance costs, normal anticipated Medicare and Medicaid reimbursement rate increases, net of provider taxes, acquisitions closed in the first half of 2021 and recovery of the COVID-19 pandemic. It also excludes acquisition-related costs and amortization costs related to intangible assets acquired, share-based compensation and start-up losses.

A discussion of the company’s use of non-GAAP financial measures is set forth below. A reconciliation of net income to EBITDA, adjusted EBITDAR, adjusted EBITDA, FFO for our real estate segment as well as a reconciliation of GAAP earnings per share, net income to adjusted net income and adjusted net earnings per share appear in the financial data portion of this release. More complete information is contained in the company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2021 which is filed with the SEC today and can be viewed on the company’s website at http://www.ensigngroup.net.

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

This press release contains, and the related conference call and webcast will include, forward-looking statements that are based on management’s current expectations, assumptions and beliefs about its business, financial performance, operating results, the industry in which it operates and other future events. Forward-looking statements can often be identified by words such as “anticipates,” “expects,” “intends,” “plans,” “predicts,” “believes,” “seeks,” “estimates,” “may,” “will,” “should,” “would,” “could,” “potential,” “continue,” “ongoing,” similar expressions, and variations or negatives of these words. These forward-looking statements include, but are not limited to, statements regarding growth prospects, future operating and financial performance, and acquisition activities. They are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to materially and adversely differ from those expressed in any forward-looking statement.

These risks and uncertainties relate to the company’s business, its industry and its common stock and include: reduced prices and reimbursement rates for its services; its ability to acquire, develop, manage or improve operations, its ability to manage its increasing borrowing costs as it incurs additional indebtedness to fund the acquisition and development of operations; its ability to access capital on a cost-effective basis to continue to successfully implement its growth strategy; its operating margins and profitability could suffer if it is unable to grow and manage effectively its increasing number of operations; competition from other companies in the acquisition, development and operation of facilities; its ability to defend claims and lawsuits, including professional liability claims alleging that our services resulted in personal injury, and other regulatory-related claims; and the application of existing or proposed government regulations, or the adoption of new laws and regulations, that could limit its business operations, require it to incur significant expenditures or limit its ability to relocate its operations if necessary. Additionally, our business and operations for 2021 continue to be impacted by the COVID-19 pandemic. Because of the unprecedented nature of the pandemic, we are unable to predict the full extent and duration of the financial impact of COVID-19 on our business, financial condition and results of operations. Therefore, our actual results could differ materially and adversely from those expressed in any forward-looking statements as a result of various factors. Readers should not place undue reliance on any forward-looking statements and are encouraged to review the company’s periodic filings with the Securities and Exchange Commission, including its Form 10-K and Form 10-Q, for a more complete discussion of the risks and other factors that could affect Ensign’s business, prospects and any forward-looking statements. Except as required by the federal securities laws, Ensign does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changing circumstances or any other reason after the date of this press release.

Contact Information

Investor/Media Relations, The Ensign Group, Inc., (949) 487-9500, [email protected].

SOURCE: The Ensign Group, Inc.

THE ENSIGN GROUP, INC.

UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF INCOME

	Three Months Ended March 31,
(In thousands, except per share data)	2021			2020

Revenue:
Service revenue	$	623,276		$	585,951
Rental revenue	3,977			3,662
Total revenue	$	627,253		$	589,613
Expense:
Cost of services	482,186			454,521
Rent—cost of services	33,456			32,330
General and administrative expense	34,273			32,249
Depreciation and amortization	13,659			13,720
Total expenses	563,574			532,820
Income from operations	63,679			56,793
Other income (expense):
Interest expense	(1,641		)	(3,665		)
Interest and other income	748			698
Other expense, net	(893		)	(2,967		)
Income before provision for income taxes	62,786			53,826
Provision for income taxes	12,949			12,625
Net income	49,837			41,201
Less: net income attributable to noncontrolling interests	631			352
Net income attributable to The Ensign Group, Inc.	$	49,206		$	40,849

Net income per share attributable to The Ensign Group, Inc.:
Basic	$	0.91		$	0.76
Diluted	$	0.86		$	0.73
Weighted average common shares outstanding:
Basic	54,192			53,475
Diluted	56,891			55,796

THE ENSIGN GROUP, INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

	March 31, 2021		December 31, 2020

	(In thousands)
Assets
Current assets:
Cash and cash equivalents	$	155,527	$	236,562
Accounts receivable—less allowance for doubtful accounts of $11,090 and $8,718 at March 31, 2021 and December 31, 2020, respectively	312,578		305,062
Investments—current	14,623		13,449
Prepaid income taxes	—		1,224
Prepaid expenses and other current assets	30,588		26,659
Total current assets	513,316		582,956
Property and equipment, net	779,269		778,244
Right-of-use assets	1,050,506		1,025,510
Insurance subsidiary deposits and investments	34,370		32,105
Escrow deposits	350		100
Deferred tax assets	32,424		32,424
Restricted and other assets	41,422		33,155
Intangible assets, net	2,828		2,899
Goodwill	54,469		54,469
Other indefinite-lived intangibles	3,546		3,716
Total assets	$	2,512,500	$	2,545,578
Liabilities and equity
Current liabilities:
Accounts payable	$	53,942	$	50,901
Accrued wages and related liabilities	203,420		236,614
Lease liabilities—current	50,056		48,187
Accrued self-insurance liabilities—current	35,135		34,396
Advance payment liabilities	—		102,023
Other accrued liabilities	97,639		87,318
Current maturities of long-term debt	2,828		2,960
Total current liabilities	443,020		562,399
Long-term debt—less current maturities	111,859		112,544
Long-term lease liabilities—less current portion	973,679		950,320
Accrued self-insurance liabilities—less current portion	66,742		62,402
Other long-term liabilities	41,620		39,686
Total equity	875,580		818,227
Total liabilities and equity	$	2,512,500	$	2,545,578

THE ENSIGN GROUP, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

The following table presents selected data from our condensed consolidated statements of cash flows for the periods presented:

	Three Months Ended March 31,
	2021			2020

	(In thousands)
Net cash provided by/(used in):
Operating activities	$	34,294		$	27,123
Investing activities	(12,212		)	(15,542		)
Financing activities	(103,117		)	(7,539		)
Net (decrease)/increase in cash and cash equivalents	(81,035		)	4,042
Cash and cash equivalents beginning of period	236,562			59,175
Cash and cash equivalents at end of period	$	155,527		$	63,217

THE ENSIGN GROUP, INC.

UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION

(In thousands, except per share data)

RECONCILIATION OF GAAP TO NON-GAAP NET INCOME

The following table reconciles net income to Non-GAAP net income for the periods presented:

	Three Months Ended March 31,
	2021			2020
Net income	$	49,206		$	40,849

Non-GAAP adjustments
Stock-based compensation expense(a)	4,054			3,235
Results related to operations not at full capacity(b)	657			416
Acquisition related costs(c)	36			50
Depreciation and amortization – patient base(d)	12			213
Cost of services – gain on sale of assets	(540		)	—
Provision for income taxes on Non-GAAP adjustments(e)	(3,801		)	(1,809		)
Non-GAAP income	$	49,624		$	42,954

Average number of diluted shares outstanding	56,891			55,796

Diluted Earnings Per Share
Net income	$	0.86		$	0.73

Adjusted Diluted Earnings Per Share
Net Income	$	0.87		$	0.77

Footnotes:
(a) Represents stock-based compensation expense incurred.
	Three Months Ended March 31,
	2021			2020
Cost of services	$	2,500		$	2,111
General and administrative	1,554			1,124
Total Non-GAAP adjustment	$	4,054		$	3,235

(b) Represents results to operations not at full capacity
	Three Months Ended March 31,
	2021			2020
Revenue	$	(456	)	$	(729	)
Cost of services	1,040			1,071
Rent	38			22
Depreciation and amortization	35			52
Total Non-GAAP adjustment	$	657		$	416

(c) Represents costs incurred to acquire an operation which are not capitalizable.
(d) Included in depreciation and amortization are expenses related to patient base intangible assets at newly acquired skilled nursing and senior living facilities.
(e) Represents an adjustment to the provision for income tax to our historical year to date effective tax rate of 25.0% for the three months ended March 31, 2021 and 2020.

THE ENSIGN GROUP, INC.

UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION

(In thousands)

The table below reconciles net income to EBITDA, Adjusted EBITDA and Adjusted EBITDAR for the periods presented:

	Three Months Ended March 31,
	2021			2020
Consolidated Statements of Income Data:
Net income attributable to The Ensign Group, Inc.	$	49,837		$	41,201
Less: net income attributable to noncontrolling interests	631			352
Add: Interest expense, net	893			2,967
Provision for income taxes	12,949			12,625
Depreciation and amortization	13,659			13,720
EBITDA	$	76,707		$	70,161
Adjustments to EBITDA:
Stock-based compensation expense	4,054			3,235
Results related to operations not at full capacity(a)	584			342
Gain on sale on assets	(540		)	—
Acquisition related costs(b)	36			50
Rent related to items above	38			22
Adjusted EBITDA	$	80,879		$	73,810
Rent—cost of services	33,456			32,330
Less: rent related to items above	(38		)	(22		)
Adjusted rent	33,418			32,308
Adjusted EBITDAR	$	114,297

(a) Represents results at closed operations and operations not at full capacity.
(b) Costs incurred to acquire operations which are not capitalizable.

THE ENSIGN GROUP, INC.

UNAUDITED SELECT PERFORMANCE INDICATORS

The following tables summarize our selected performance indicators for our transitional and skilled services segment along with other statistics, for each of the dates or periods indicated:

	Three Months Ended March 31,
	2021			2020			Change			% Change

Total Facility Results:	(Dollars in thousands)
Transitional and skilled revenue⁽⁴⁾	$	601,036		$	558,304		$	42,732		7.7		%
Number of facilities at period end	200			194			6			3.1		%
Number of campuses at period end*	23			22			1			4.5		%
Actual patient days⁽⁴⁾	1,509,600			1,643,390			(133,790		)	(8.1	)	%
Occupancy percentage — Operational beds	71.1		%	79.4		%				(8.3	)	%
Skilled mix by nursing days	34.4		%	29.3		%				5.1		%
Skilled mix by nursing revenue	55.6		%	50.1		%				5.5		%
	Three Months Ended March 31,
	2021			2020			Change			% Change

Same Facility Results(1):	(Dollars in thousands)
Transitional and skilled revenue⁽⁴⁾	$	491,790		$	476,896		$	14,894		3.1		%
Number of facilities at period end	165			165			—			—		%
Number of campuses at period end*	15			15			—			—		%
Actual patient days⁽⁴⁾	1,219,693			1,371,803			(152,110		)	(11.1	)	%
Occupancy percentage — Operational beds	72.2		%	80.4		%				(8.2	)	%
Skilled mix by nursing days	35.4		%	31.0		%				4.4		%
Skilled mix by nursing revenue	56.6		%	52.1		%				4.5		%

	Three Months Ended March 31,
	2021			2020			Change			% Change

Transitioning Facility Results(2):	(Dollars in thousands)
Transitional and skilled revenue⁽⁴⁾	$	89,025		$	79,027		$	9,998		12.7		%
Number of facilities at period end	26			26			—			—		%
Number of campuses at period end*	7			7			—			—		%
Actual patient days⁽⁴⁾	235,668			263,341			(27,673		)	(10.5	)	%
Occupancy percentage — Operational beds	66.9		%	74.7		%				(7.8	)	%
Skilled mix by nursing days	30.6		%	20.7		%				9.9		%
Skilled mix by nursing revenue	51.2		%	38.7		%				12.5		%

	Three Months Ended March 31,
	2021			2020			Change		% Change

Recently Acquired Facility Results(3):	(Dollars in thousands)
Transitional and skilled revenue⁽⁴⁾	$	20,221		$	2,381		$	17,840	NM
Number of facilities at period end	9			3			6		NM
Number of campuses at period end*	1			—			1		NM
Actual patient days⁽⁴⁾	54,239			8,246			45,993		NM
Occupancy percentage — Operational beds	66.8		%	73.6		%			NM
Skilled mix by nursing days	28.1		%	18.1		%			NM
Skilled mix by nursing revenue	49.5		%	31.7		%			NM

* Campus represents a facility that offers both skilled nursing and senior living services. Revenue and expenses related to skilled nursing and senior living services have been allocated and recorded in the respective operating segment.
(1)   Same Facility results represent all facilities purchased prior to January 1, 2018.
(2)   Transitioning Facility results represent all facilities purchased from January 1, 2018 to December 31, 2019.
(3)   Recently Acquired Facility (Acquisitions) results represent all facilities purchased on or subsequent to January 1, 2020.
(4)   The first quarter of 2021 included 90 days compared to 91 days for the same period in 2020 as a result of the leap year.

THE ENSIGN GROUP, INC.

SKILLED NURSING AVERAGE DAILY REVENUE RATES AND

PERCENT OF SKILLED NURSING REVENUE AND DAYS BY PAYOR

(Unaudited)

The following table reflects the change in skilled nursing average daily revenue rates by payor source, excluding services that are not covered by the daily rate⁽¹⁾:

	Three Months Ended March 31,
	Same Facility				Transitioning				Acquisitions				Total
	2021		2020		2021		2020		2021		2020		2021		2020
Skilled Nursing Average Daily Revenue Rates:
Medicare	$	691.83	$	663.60	$	678.43	$	628.33	$	737.01	$	508.35	$	691.34	$	657.78
Managed care	505.34		477.01		484.69		438.87		365.48		416.96		500.13		472.74
Other skilled	546.42		523.47		400.72		323.86		512.79		—		533.43		513.89
Total skilled revenue	595.16		560.95		576.89		531.21		604.56		485.19		592.90		557.35
Medicaid	251.41		231.40		241.67		219.18		240.72		232.31		249.38		229.23
Private and other payors	239.48		233.91		241.99		218.82		243.88		228.44		240.06		230.95
Total skilled nursing revenue	$	371.89	$	333.89	$	344.15	$	283.62	$	343.36	$	277.07	$	366.53	$	325.54

(1) These rates exclude additional FMAP we recognized and include sequestration reversal of 2%.

The following tables set forth our percentage of skilled nursing patient revenue and days by payor source for the three months ended March 31, 2021 and 2020:

	Three Months Ended March 31,
	Same Facility								Transitioning								Acquisitions								Total
	2021				2020				2021				2020				2021				2020				2021				2020
Percentage of Skilled Nursing Revenue:
Medicare	29.4		%		25.2		%		30.9		%		24.1		%		33.2		%		24.8		%		29.7		%		25.0		%
Managed care	19.0				18.9				17.3				13.0				6.4				6.9				18.3				18.0
Other skilled	8.2				8.0				3.0				1.6				9.9				—				7.6				7.1
Skilled mix	56.6				52.1				51.2				38.7				49.5				31.7				55.6				50.1
Private and other payors	5.9				7.7				7.0				10.6				6.9				21.1				6.1				8.1
Medicaid	37.5				40.2				41.8				50.7				43.6				47.2				38.3				41.8
Total skilled nursing	100.0		%		100.0		%		100.0		%		100.0		%		100.0		%		100.0		%		100.0		%		100.0		%
		Three Months Ended March 31,
		Same Facility								Transitioning								Acquisitions								Total
		2021				2020				2021				2020				2021				2020				2021				2020
Percentage of Skilled Nursing Days:
Medicare		15.8		%		12.7		%		15.7		%		10.9		%		15.5		%		13.5		%		15.8		%		12.4		%
Managed care		14.0				13.2				12.3				8.4				6.0				4.6				13.4				12.4
Other skilled		5.6				5.1				2.6				1.4				6.6				—				5.2				4.5
Skilled mix		35.4				31.0				30.6				20.7				28.1				18.1				34.4				29.3
Private and other payors		9.1				11.0				9.9				13.8				9.7				25.6				9.3				11.5
Medicaid		55.5				58.0				59.5				65.5				62.2				56.3				56.3				59.2
Total skilled nursing		100.0		%		100.0		%		100.0		%		100.0		%		100.0		%		100.0		%		100.0		%		100.0		%

THE ENSIGN GROUP, INC.

UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION BY SEGMENT

(In thousands)

Transitional and Skilled Services

The table below reconciles net income to EBITDA and Adjusted EBITDA for the transitional and skilled services reportable segment for the periods presented:

	Three Months Ended March 31,
	2021		2020
Statements of Income Data:
Segment income(a)	$	88,931	$	80,591
Depreciation and amortization	7,475		7,148
EBITDA	96,406		87,739
Adjustments to EBITDA:
Stock-based compensation expense	2,411		2,000
Adjusted EBITDA	$	98,817	$	89,739

Real Estate

The following table sets forth details of operating results for our revenue and earnings, and their respective components, by our real estate segment the periods indicated:

	Three Months Ended March 31,
	2021		2020

Rental revenue generated from third-party tenants	$	3,977	$	3,662
Rental revenue generated from Ensign affiliated operations	11,902		11,282
Total rental revenue	15,879		14,944
Segment income(a)	8,821		6,325
Depreciation and amortization	4,693		4,515
FFO(b)	$	13,514	$	10,840

(a) Segment income reflects profits or loss from operations before provision for income taxes, excluding gain or loss from sale of real estate, insurance recoveries and impairment charges from operations. General and administrative expenses are not allocated to any segment for purposes of determining segment profit or loss.
(b) FFO, in accordance with the definition used by the National Association of Real Estate Investment Trusts, means net income attributable to common stockholders, computed in accordance with U.S. GAAP, excluding gains (or losses) from sales of real estate and impairment of depreciable real estate assets and including depreciation and amortization related to real estate to earnings.

THE ENSIGN GROUP, INC.

UNAUDITED REVENUE BY PAYOR SOURCE

The following table sets forth our service revenue by payor source and as a percentage of total service revenue for the periods indicated:

	Three Months Ended March 31,
	2021				2020
	Revenue		% of Revenue		Revenue		% of Revenue
Medicaid⁽¹⁾	$	231,358	37.1	%	$	224,195	38.3	%
Medicare	190,303		30.5		155,584		26.6
Medicaid — skilled	39,993		6.5		36,009		6.1
Total Medicaid and Medicare	461,654		74.1		415,788		71.0
Managed care	108,345		17.4		102,029		17.4
Private and other⁽²⁾	53,277		8.5		68,134		11.6
Service revenue	$	623,276	100.0	%	$	585,951	100.0	%

(1) Medicaid payor includes revenue for senior living operations and revenue related to FMAP for the three months ended March 31, 2021 and 2020.
(2) Private and other payors also includes revenue from all payors generated in our other ancillary operations for the three months ended March 31, 2021 and 2020.

Discussion of Non-GAAP Financial Measures

EBITDA consists of net income before (a) interest expense, net, (b) provisions for income taxes and (c) depreciation and amortization. Adjusted EBITDA consists of net income before (a) interest expense, net, (b) provisions for income taxes, (c) depreciation and amortization, (d) stock-based compensation expense; (e) results of operations not at full capacity, excluding depreciation, interest and income taxes, (f) acquisition related costs and (g) gain on sale of assets. Adjusted EBITDAR consists of net income before (a) interest expense, net, (b) provisions for income taxes, (c) depreciation and amortization, (d) rent-cost of services, (e) stock-based compensation expense; (f) results of operations not at full capacity, excluding rent, depreciation, interest and income taxes, (g) acquisition related costs and (h) gain on sale of assets. Funds from Operations (FFO) for our real estate segment consists of segment income, excluding gains (or losses) from sales of real estate and insurance recoveries related to real estate and impairment of depreciable real estate assets and including depreciation and amortization related to real estate to earnings. The company believes that the presentation of EBITDA, adjusted EBITDA, FFO, adjusted net income and adjusted earnings per share provides important supplemental information to management and investors to evaluate the company’s operating performance. Adjusted EBITDAR is a financial valuation measure that is not specified in GAAP. This measure is not displayed as a performance measure as it excludes rent expense, which is a normal and recurring operating expense. The company believes disclosure of adjusted net income, adjusted net income per share, FFO, EBITDA, adjusted EBITDA and adjusted EBITDAR has substance because the excluded revenues and expenses are infrequent in nature and are variable in nature, or do not represent current revenues or cash expenditures. A material limitation associated with the use of these measures as compared to the GAAP measures of net income and diluted earnings per share is that they may not be comparable with the calculation of net income and diluted earnings per share for other companies in the company’s industry. These non-GAAP financial measures should not be relied upon to the exclusion of GAAP financial measures. For further information regarding why the company believes that this non-GAAP measures provide useful information to investors, the specific manner in which management uses these measures, and some of the limitations associated with the use of these measures, please refer to the company’s periodic filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K and Quarterly Report on Form 10-Q. The company’s periodic filings are available on the SEC’s website at www.sec.gov or under the “Financial Information” link of the Investor Relations section on Ensign’s website at http://www.ensigngroup.net.

April 29, 2021 4:21 pm

Griffon Corporation Announces Second Quarter Results

Griffon Corporation Announces Second Quarter Results

NEW YORK–(BUSINESS WIRE)–
Griffon Corporation (“Griffon” or the “Company”) (NYSE:GFF) today reported results for the second quarter of fiscal 2021 ended March 31, 2021.

Consolidated revenue for the second quarter totaled $634.8 million, a 12% increase compared to the prior year quarter revenue of $566.4 million.

Net income totaled $17.1 million, or $0.32 per share, compared to $0.9 million, or $0.02 per share, in the prior year quarter. Current year adjusted net income was $25.4 million, or $0.48 per share, compared to $10.1 million, or $0.23 per share, in the prior year quarter, a 109% increase (see reconciliation of Net income to Adjusted net income for details).

Adjusted EBITDA for the second quarter was $67.8 million, increasing 41% from the prior year quarter of $48.0 million. Unallocated amounts excluding depreciation (primarily corporate overhead) in each of the second quarter of 2021 and 2020 was $11.9 million. Adjusted EBITDA excluding unallocated amounts totaled $79.7 million in the second quarter of 2021, increasing 33% from the prior year of $59.9 million. Adjusted EBITDA is defined as net income excluding interest income and expense, income taxes, depreciation and amortization, restructuring charges, loss from debt extinguishment and acquisition related expenses, as well as other items that may affect comparability, as applicable (see reconciliation of Adjusted EBITDA to Income before taxes).

Ronald J. Kramer, Chairman and Chief Executive Officer, commented, “Our excellent performance in the fiscal second quarter is a result of our continued operating improvement and robust demand for our diverse portfolio of leading brands and essential products. Our team is poised to deliver further improvements in the years ahead as we optimize our businesses through strategic initiatives. Griffon is well-positioned to continue delivering long term shareholder value.”

Segment Operating Results

Consumer and Professional Products (“CPP”)

CPP revenue in the current quarter totaling $331.9 million increased 21% compared to the prior year period, primarily due to increased volume of 17%, driven by continued consumer demand across all geographies, primarily for outdoor decor, landscaping and home organization products, and a favorable foreign currency impact of 4%.

CPP Adjusted EBITDA in the second quarter was $37.4 million, increasing 50% from the prior year quarter primarily from increased revenue noted above and a favorable foreign currency impact of 8%, partially offset by increased distribution and material costs, and COVID-19 related inefficiencies.

Strategic Initiative

In November 2019, Griffon announced the development of a next-generation business platform for CPP to enhance the growth, efficiency, and competitiveness of its U.S. operations, and on November 12, 2020, Griffon announced the broadening of this strategic initiative to include additional North American facilities, the AMES UK and Australia businesses, and a manufacturing facility in China.

The expanded focus of this initiative leverages the same three key development areas being executed within our U.S. operations. First, certain AMES global operations will be consolidated to optimize facilities footprint and talent. Second, strategic investments in automation and facilities expansion will be made to increase the efficiency of our manufacturing and fulfillment operations, and support e-commerce growth. Third, multiple independent information systems will be unified into a single data and analytics platform, which will serve the whole AMES global enterprise.

Expanding the roll-out of the new business platform from our AMES U.S. operations to include AMES’ global operations will extend the duration of the project by one year, with completion now expected by the end of calendar year 2023. When fully implemented, these actions will result in annual cash savings of $30 million to $35 million and a reduction in inventory of $30 million to $35 million, both based on fiscal 2020 operating levels.

The cost to implement this new business platform, over the duration of the project, will include one-time charges of approximately $65 million and capital investments of approximately $65 million. The one-time charges are comprised of $46 million of cash charges, which includes $26 million of personnel-related costs such as training, severance, and duplicate personnel costs as well as $20 million of facility and lease exit costs. The remaining $19 million of charges are non-cash and are primarily related to asset write-downs.

During the six months ended March 31, 2021 and 2020, CPP incurred pre-tax restructuring and related exit costs approximating $10.6 million and $9.5 million, respectively. During the six months ended March 31, 2021, cash charges totaled $7.9 million and non-cash, asset-related charges totaled $2.7 million; the cash charges included $1.1 million for one-time termination benefits and other personnel-related costs and $6.8 million for facility exit costs. During the six months ended March 31, 2020, cash charges totaled $4.8 million and non-cash, asset-related charges totaled $4.7 million; the cash charges included $3.8 million for one-time termination benefits and other personnel-related costs and $1.1 million for facility exit costs.

Home and Building Products (“HBP”)

HBP revenue in the current quarter totaling $242.8 million increased 16% from the prior year quarter, driven by increased volume.

HBP Adjusted EBITDA in the current quarter was $40.1 million, increasing 31% compared to the prior year quarter. EBITDA benefited from increased revenue noted above and volume related benefits on absorption, partially offset by increased material costs and COVID-19 related inefficiencies.

Defense Electronics (“DE”)

DE revenue in the current quarter totaled $60.2 million, decreasing 26% from the prior year quarter. The prior year results include revenue from the SEG business of $7.5 million. Excluding the divestiture of SEG from prior year results, revenue decreased $14.0 million, or 19%. The decrease was driven by reduced volume due to the timing of work performed and deliveries on Communication and Surveillance programs.

DE Adjusted EBITDA in the current quarter was $2.2 million, decreasing 48% from the prior year quarter, driven by the reduced revenue noted above and cost growth on Surveillance programs, partially offset by the reduced headcount related to the reduction in force that occurred in the first quarter.

Contract backlog was $353.9 million at March 31, 2021 compared to $320.2 million at March 31, 2020 (excludes $11.5 million of SEG related backlog) with 65% expected to be fulfilled in the next 12 months. Backlog was approximately $370.0 million at September 30, 2020 (excludes approximately $10.0 million of SEG related backlog). During the current quarter and year-to-date periods, DE was awarded several new contracts and received incremental funding on existing contracts approximating $25 million and $105 million (excludes $5.5 million of SEG awards from the first quarter), respectively; the trailing twelve month book-to-bill ratio was 1.1.

Taxes

The Company reported pretax income for the quarters ended March 31, 2021 and 2020, respectively, and recognized tax provisions of 38.6% and 69.4%, respectively. Excluding all items that affect comparability, the effective tax rates for the quarters ended March 31, 2021 and 2020 were 30.0% and 35.9%, respectively. The current year-to-date effective tax rate was 30.5% and the rate excluding all items that affect comparability was 31.1%.

Balance Sheet and Capital Expenditures

At March 31, 2021, the Company had cash and equivalents of $175.6 million and total debt outstanding of $1.06 billion, resulting in a net debt position of $0.9 billion. Borrowing availability under the revolving credit facility was $363.1 million subject to certain loan covenants. Capital expenditures were $12.1 million for the quarter ended March 31, 2021.

Share Repurchases

As of March 31, 2021, Griffon had $58 million remaining under its Board of Directors authorized repurchase program. There were no purchases under these authorizations during the quarter ended March 31, 2021.

Conference Call Information

The Company will hold a conference call today, April 29, 2021, at 4:30 PM ET.

The call can be accessed by dialing 1-877-407-0792 (U.S. participants) or 1-201-689-8263 (International participants). Callers should ask to be connected to the Griffon Corporation teleconference or provide conference ID number 13719101. Participants are encouraged to dial-in at least 10 minutes before the scheduled start time.

A replay of the call will be available starting on Thursday, April 29, 2021 at 7:30 PM ET by dialing 1-844-512-2921 (U.S.) or 1-412-317-6671 (International), and entering the conference ID number: 13719101. The replay will be available through Thursday, May 13, 2021 at 11:59 PM ET.

Forward-looking Statements

“Safe Harbor” Statements under the Private Securities Litigation Reform Act of 1995: All statements related to, among other things, income (loss), earnings, cash flows, revenue, changes in operations, operating improvements, industries in which Griffon operates and the United States and global economies that are not historical are hereby identified as “forward-looking statements” and may be indicated by words or phrases such as “anticipates,” “supports,” “plans,” “projects,” “expects,” “believes,” “should,” “would,” “could,” “hope,” “forecast,” “management is of the opinion,” “may,” “will,” “estimates,” “intends,” “explores,” “opportunities,” the negative of these expressions, use of the future tense and similar words or phrases. Such forward-looking statements are subject to inherent risks and uncertainties that could cause actual results to differ materially from those expressed in any forward-looking statements. These risks and uncertainties include, among others: current economic conditions and uncertainties in the housing, credit and capital markets; Griffon’s ability to achieve expected savings from cost control, restructuring, integration and disposal initiatives; the ability to identify and successfully consummate, and integrate, value-adding acquisition opportunities; increasing competition and pricing pressures in the markets served by Griffon’s operating companies; the ability of Griffon’s operating companies to expand into new geographic and product markets, and to anticipate and meet customer demands for new products and product enhancements and innovations; reduced military spending by the government on projects for which Griffon’s Telephonics Corporation supplies products, including as a result of defense budget cuts or other government actions; the ability of the federal government to fund and conduct its operations; increases in the cost or lack of availability of raw materials such as resin, wood and steel, components or purchased finished goods, including the impact from tariffs; changes in customer demand or loss of a material customer at one of Griffon’s operating companies; the potential impact of seasonal variations and uncertain weather patterns on certain of Griffon’s businesses; political events that could impact the worldwide economy; a downgrade in Griffon’s credit ratings; changes in international economic conditions including interest rate and currency exchange fluctuations; the reliance by certain of Griffon’s businesses on particular third party suppliers and manufacturers to meet customer demands; the relative mix of products and services offered by Griffon’s businesses, which impacts margins and operating efficiencies; short-term capacity constraints or prolonged excess capacity; unforeseen developments in contingencies, such as litigation, regulatory and environmental matters; unfavorable results of government agency contract audits of Telephonics Corporation; Griffon’s ability to adequately protect and maintain the validity of patent and other intellectual property rights; the cyclical nature of the businesses of certain of Griffon’s operating companies; and possible terrorist threats and actions and their impact on the global economy; the impact of COVID-19 on the U.S. and the global economy, including business disruptions, reductions in employment and an increase in business and operating facility failures, specifically among our customers; Griffon’s ability to service and refinance its debt; and the impact of recent and future legislative and regulatory changes, including, without limitation, tax law changes Such statements reflect the views of the Company with respect to future events and are subject to these and other risks, as previously disclosed in the Company’s Securities and Exchange Commission filings. Readers are cautioned not to place undue reliance on these forward-looking statements. These forward-looking statements speak only as of the date made. Griffon undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

About Griffon Corporation

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

Griffon currently conducts its operations through three reportable segments:

CPP conducts its operations through AMES. Founded in 1774, AMES is the leading North American manufacturer and a global provider of branded consumer and professional tools and products for home storage and organization, landscaping, and enhancing outdoor lifestyles. CPP sells products globally through a portfolio of leading brands including True Temper, AMES, and ClosetMaid.

HBP conducts its operations through Clopay. Founded in 1964, Clopay is the largest manufacturer and marketer of garage doors and rolling steel doors in North America. Residential and commercial sectional garage doors are sold through professional dealers and leading home center retail chains throughout North America under the brands Clopay, Ideal, and Holmes. Rolling steel door and grille products designed for commercial, industrial, institutional, and retail use are sold under the CornellCookson brand.

Defense Electronics conducts its operations through Telephonics Corporation, founded in 1933, a globally recognized leading provider of highly sophisticated intelligence, surveillance and communications solutions for defense, aerospace and commercial customers.

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

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

The following table provides operating highlights and a reconciliation of Adjusted EBITDA to Income before taxes:

(in thousands)	For the Three Months Ended March 31,						For the Six Months Ended March 31,
REVENUE	2021			2020			2021			2020
Consumer and Professional Products	$	331,871		$	274,912		$	622,913		$	515,988
Home and Building Products	242,811			209,829			493,292			451,210
Defense Electronics	60,150			81,609			127,918			147,590
Total consolidated net sales	$	634,832		$	566,350		$	1,244,123		$	1,114,788

ADJUSTED EBITDA
Consumer and Professional Products	$	37,423		$	25,027		$	70,136		$	46,953
Home and Building Products	40,060			30,635			88,429			71,336
Defense Electronics	2,220			4,248			7,805			8,723
Total	79,703			59,910			166,370			127,012
Unallocated amounts, excluding depreciation*	(11,922		)	(11,947		)	(23,949		)	(23,889		)
Adjusted EBITDA	67,781			47,963			142,421			103,123
Net interest expense	(15,527		)	(16,561		)	(31,172		)	(32,511		)
Depreciation and amortization	(15,883		)	(15,719		)	(31,149		)	(31,544		)
Loss from debt extinguishment	—			(6,690		)	—			(6,690		)
Restructuring charges	(7,562		)	(3,104		)	(18,362		)	(9,538		)
Acquisition costs	—			(2,960		)	—			(2,960		)
Gain (adjustment) on sale of SEG business	(949		)	—			5,291			—
Income before taxes	$	27,860		$	2,929		$	67,029		$	19,880


DEPRECIATION and AMORTIZATION
Segment:
Consumer and Professional Products	$	8,620		$	8,222		$	16,819		$	16,453
Home and Building Products	4,379			4,668			8,720			9,468
Defense Electronics	2,734			2,676			5,410			5,320
Total segment depreciation and amortization	15,733			15,566			30,949			31,241
Corporate	150			153			200			303
Total consolidated depreciation and amortization	$	15,883		$	15,719		$	31,149		$	31,544
* Primarily Corporate Overhead

Griffon believes Free Cash Flow (“FCF”, a non-GAAP measure) is a useful measure for investors because it portrays the Company’s ability to generate cash from operations for purposes such as repaying debt, funding acquisitions and paying dividends.

The following table provides a reconciliation of Net cash used in operating activities to FCF:

	For the Six Months Ended March 31,
(in thousands)	2021			2020
Net cash used in operating activities	$	(25,841	)	$	(60,843	)
Acquisition of property, plant and equipment	(23,986		)	(22,519		)
Proceeds from the sale of property, plant and equipment	82			290
FCF	$	(49,745	)	$	(83,072	)

The following tables provide a reconciliation of Gross profit and Selling, general and administrative expenses for items that affect comparability for the three and six month periods ended March 31, 2021 and 2020:

(in thousands)	For the Three Months Ended March 31,						For the Six Months Ended March 31,
	2021			2020			2021			2020
Gross Profit, as reported	$	170,316		$	152,032		$	340,488		$	301,953
% of revenue	26.8		%	26.8		%	27.4		%	27.1		%
Adjusting items:
Restructuring charges	3,337			1,353			9,762			4,076
Gross Profit, as adjusted	$	173,653		$	153,385		$	350,250		$	306,029
% of revenue	27.4		%	27.1		%	28.2		%	27.5		%

(in thousands)	For the Three Months Ended March 31,						For the Six Months Ended March 31,
	2021			2020			2021			2020
Selling, general and administrative expenses, as reported	$	126,827		126,467			248,384			244,265
% of revenue	20.0		%	22.3		%	20.0		%	21.9		%
Adjusting items:
Restructuring charges	(4,225)			(1,751)			(8,600)			(5,462)
Acquisition costs	—			(2,960)			—			(2,960)
Selling, general and administrative expenses, as adjusted	$	122,602		$	121,756		$	239,784		$	235,843
% of revenue	19.3		%	21.5		%	19.3		%	21.2		%

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

	Three Months Ended March 31,						Six Months Ended March 31,
	2021			2020			2021			2020
Revenue	$	634,832		$	566,350		$	1,244,123		$	1,114,788
Cost of goods and services	464,516			414,318			903,635			812,835
Gross profit	170,316			152,032			340,488			301,953
Selling, general and administrative expenses	126,827			126,467			248,384			244,265
Income from operations	43,489			25,565			92,104			57,688

Other income (expense)
Interest expense	(15,831		)	(16,871		)	(31,521		)	(33,082		)
Interest income	304			310			349			571
Gain (adjustment) on sale of business	(949		)	—			5,291			—
Loss from debt extinguishment, net	—			(6,690		)	—			(6,690		)
Other, net	847			615			806			1,393
Total other expense, net	(15,629		)	(22,636		)	(25,075		)	(37,808		)

Income before taxes	27,860			2,929			67,029			19,880
Provision for income taxes	10,748			2,034			20,417			8,373
Net income	$	17,112		$	895		$	46,612		$	11,507
Basic earnings per common share	$	0.34		$	0.02		$	0.92		$	0.28
Basic weighted-average shares outstanding	50,838			41,565			50,717			41,369
Diluted earnings per common share	$	0.32		$	0.02		$	0.88		$	0.26
Diluted weighted-average shares outstanding	53,264			43,734			53,211			43,826
Dividends paid per common share	$	0.08		$	0.075		$	0.16		$	0.15

Net income	$	17,112		$	895		$	46,612		$	11,507
Other comprehensive income (loss), net of taxes:
Foreign currency translation adjustments	1,739			(16,471		)	13,862			(10,001		)
Pension and other post retirement plans	1,245			669			2,951			1,341
Change in cash flow hedges	1,791			968			1,103			667
Total other comprehensive income (loss), net of taxes	4,775			(14,834		)	17,916			(7,993		)
Comprehensive income, net	$	21,887		$	(13,939	)	$	64,528		$	3,514

GRIFFON CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands)

	(Unaudited)
	March 31, 2021		September 30, 2020
CURRENT ASSETS
Cash and equivalents	$	175,564	$	218,089
Accounts receivable, net of allowances of $9,594 and $8,505	399,193		340,546
Contract assets, net of progress payments of $20,449 and $24,175	75,000		84,426
Inventories	484,753		413,825
Prepaid and other current assets	55,705		46,897
Assets of discontinued operations	1,525		2,091
Total Current Assets	1,191,740		1,105,874
PROPERTY, PLANT AND EQUIPMENT, net	341,005		343,964
OPERATING LEASE RIGHT-OF-USE ASSETS	154,929		161,627
GOODWILL	446,365		442,643
INTANGIBLE ASSETS, net	357,506		355,028
OTHER ASSETS	27,440		32,897
ASSETS OF DISCONTINUED OPERATIONS	5,295		6,406
Total Assets	$	2,524,280	$	2,448,439

CURRENT LIABILITIES
Notes payable and current portion of long-term debt	$	14,913	$	9,922
Accounts payable	257,286		232,107
Accrued liabilities	151,091		163,994
Current portion of operating lease liabilities	30,685		31,848
Liabilities of discontinued operations	4,600		3,797
Total Current Liabilities	458,575		441,668
LONG-TERM DEBT, net	1,043,859		1,037,042
LONG-TERM OPERATING LEASE LIABILITIES	128,714		136,054
OTHER LIABILITIES	122,286		126,510
LIABILITIES OF DISCONTINUED OPERATIONS	6,415		7,014
Total Liabilities	1,759,849		1,748,288
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY
Total Shareholders’ Equity	764,431		700,151
Total Liabilities and Shareholders’ Equity	$	2,524,280	$	2,448,439

GRIFFON CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (Unaudited)

	Six Months Ended March 31,
	2021			2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	46,612		$	11,507
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization	31,149			31,544
Stock-based compensation	9,501			8,302
Asset impairment charges – restructuring	8,291			4,692
Provision for losses on accounts receivable	194			596
Amortization of debt discounts and issuance costs	1,349			2,267
Loss from debt extinguishment, net	—			6,690
Deferred income taxes	2,334			408
Loss (gain) on sale of assets and investments	151			(274		)
Gain on sale of business	(5,291		)	—
Change in assets and liabilities, net of assets and liabilities acquired:
Increase in accounts receivable and contract assets, net	(47,146		)	(61,815		)
Increase in inventories	(74,186		)	(21,262		)
(Increase) decrease in prepaid and other assets	271			(6,005		)
Increase (decrease) in accounts payable, accrued liabilities, income taxes payable and operating lease liabilities	(1,470		)	(38,053		)
Other changes, net	2,400			560
Net cash used in operating activities	(25,841		)	(60,843		)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment	(23,986		)	(22,519		)
Acquired businesses, net of cash acquired	(2,242		)	(10,531		)
Proceeds from sale of business, net	14,725			—
Investment purchases	(2,138		)	—
Proceeds from the sale of property, plant and equipment	82			290
Other, net	27			—
Net cash used in investing activities	(13,532		)	(32,760		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid	(8,678		)	(7,349		)
Purchase of shares for treasury	(2,909		)	(7,479		)
Proceeds from long-term debt	14,029			1,061,343
Payments of long-term debt	(7,573		)	(939,071		)
Financing costs	(571		)	(13,176		)
Other, net	(214		)	83
Net cash provided by (used in) financing activities	(5,916		)	94,351

GRIFFON CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (Unaudited)

	Six Months Ended March 31,
	2021			2020
CASH FLOWS FROM DISCONTINUED OPERATIONS:
Net cash used in operating activities	(1,512		)	(1,994		)
Net cash provided by investing activities	2,749			—

Net cash provided by (used in) discontinued operations	1,237			(1,994		)
Effect of exchange rate changes on cash and equivalents	1,527			(2,107		)
NET DECREASE IN CASH AND EQUIVALENTS	(42,525		)	(3,353		)
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD	218,089			72,377
CASH AND EQUIVALENTS AT END OF PERIOD	$	175,564		$	69,024

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

(in thousands, except per share data)	For the Three Months Ended March 31,						For the Six Months Ended March 31,
	2021			2020			2021			2020
Net income	$	17,112		$	895		$	46,612		$	11,507

Adjusting items:
Loss from debt extinguishment	—			6,690			—			6,690
Restructuring charges	7,562			3,104			18,362			9,538
(Gain) adjustment on sale of SEG business	949			—			(5,291		)	—
Acquisition costs	—			2,960			—			2,960
Tax impact of above items	(2,094		)	(2,183		)	(4,371		)	(4,469		)
Discrete and certain other tax provisions (benefits), net	1,913			(1,413		)	(115		)	(580		)

Adjusted net income	$	25,442		$	10,053		$	55,197		$	25,646

Diluted earnings per common share	$	0.32		$	0.02		$	0.88		$	0.26

Adjusting items, net of tax:
Loss from debt extinguishment	—			0.12			—			0.12
Restructuring charges	0.11			0.07			0.26			0.16
(Gain) adjustment on sale of SEG business	0.01			—			(0.10		)	—
Acquisition costs	—			0.05			—			0.05
Discrete and certain other tax provisions (benefits), net	0.04			(0.03		)	—			(0.01		)

Adjusted earnings per common share	$	0.48		$	0.23		$	1.04		$	0.59

Weighted-average shares outstanding (in thousands)	53,264			43,734			53,211			43,826

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

View source version on businesswire.com: https://www.businesswire.com/news/home/20210429006094/en/

Company Contact:

Brian G. Harris

SVP & Chief Financial Officer

Griffon Corporation

(212) 957-5000

Investor Relations Contact:

Michael Callahan

Managing Director

ICR Inc.

(203) 682-8311

KEYWORDS: United States North America New York

INDUSTRY KEYWORDS: Consulting Professional Services Finance

MEDIA: