PRESS RELEASES
| View printer-friendly version |
| << Back |
Mistras Group's Second Quarter Results Demonstrate Continued Strong Growth in Revenue and Profit
PRINCETON JUNCTION, N.J., Jan. 9, 2012 (GLOBE NEWSWIRE) -- Mistras Group, Inc. (NYSE:MG), a leading "one source" global provider of technology-enabled asset protection solutions, today reported financial results for the fiscal 2012 second quarter ending November 30, 2011. Revenue for the second quarter was $114.2 million, an increase of 29%, over the $88.8 million reported in the second quarter of fiscal 2011. Adjusted EBITDA*, a non-GAAP measure detailed later in this release, increased 29% to $20.6 million in the second quarter of fiscal 2012 versus $15.9 million in the second quarter of fiscal 2011. Net income for the second quarter of fiscal 2012 grew by 40% to $8.0 million, or $0.28 per diluted share, versus $5.7 million, or $0.21 per diluted share, in the second quarter of fiscal 2011. During the quarter the Company recorded a $0.3 million pre-tax benefit from acquisition related activities which increased diluted earnings per share by approximately $0.01.
Consistent with prior quarters, organic growth contributed the bulk of the revenue gain. In the second quarter of fiscal 2012 the organic growth rate was 19%, followed by acquisition growth of 9% and the balance due to foreign currency fluctuations. Also consistent with prior quarters, the second quarter revenue gain was achieved across a broad range of target markets.
Additional Financial Highlights for the Fiscal 2012 second quarter and 6 month period:
- In the first six months of fiscal 2012, revenues grew by 31% to $205.7 million, adjusted EBITDA grew by 33% to $32.5 million, and net income grew by 54% to $11.2 million, or $0.39 per diluted share.
- Operating income margins rose in both the second quarter and the first six months of fiscal 2012, increasing to 9.7% of revenues in the first six months of fiscal 2012, versus 8.6% in the prior year.
- SG&A as a percent of revenues declined in both the second quarter and first six months of fiscal 2012, declining to 18.8% of revenues in the first six months of fiscal 2012, versus 19.8 % in the prior year.
- After the quarter close, the Company replaced its existing revolving credit facility with a new five-year, $125.0 million facility which matures in December 2016.
Chairman and Chief Executive Officer Dr. Sotirios J. Vahaviolos stated that, "I am pleased with the momentum of our business in the second quarter, as we achieved new highs in Revenue, Adjusted EBITDA, Net Income and EPS. Once again, our 19% organic revenue growth rate was a significant driver behind our results."
Business Outlook/Guidance for Fiscal Year 2012
The Company's outlook is for continued double digit growth in revenue and Adjusted EDITDA*. Based on the results of the first six months of fiscal 2012, the Company is raising its previously issued guidance and now projects its fiscal 2012 revenues to be in the range of $400 million to $415 million, up from the previous range of $375 million to $390 million, and Adjusted EBITDA* to be in the range of $64 million to $68 million, up from the previous range of $59 million to $64 million. Mistras does not provide specific guidance for individual quarters, but will reaffirm or update its annual guidance at least quarterly.
Dr. Vahaviolos concluded, "We are pleased with the positive developments that we have seen in many of our end markets thus far in the year and we expect that our unique approach of providing 'One Source Asset Protection Solutions' to our customers will continue to receive broad acceptance worldwide for the remainder of this year and beyond."
Earnings Conference Call
In connection with this earnings release, Mistras will hold its quarterly conference call on Monday, January 9, 2012 at 9:00 a.m. (Eastern). The call will be broadcast over the Web and can be accessed on Mistras' Website, www.mistrasgroup.com. Individuals in the U.S. wishing to participate in the conference call by phone may call 1-866-730-5762 and use confirmation code 47865317 when prompted. The International dial-in number is 1-857-350-1586.
About Mistras Group, Inc.
Mistras offers one of the broadest "one source" services and technology-enabled asset protection solution portfolios in the industry used to evaluate the structural integrity of energy, industrial and public infrastructure. Mission critical services and solutions are delivered globally and provide customers with the ability to extend the useful life of their assets, improve productivity and profitability, comply with government safety and environmental regulations and enhance risk management operational decisions.
Mistras uniquely combines its industry leading products and technologies - 24/7 on-line monitoring of critical assets; mechanical integrity ("MI") and non-destructive testing ("NDT") services; and its proprietary world class data warehousing and analysis software - to provide comprehensive and competitive products, systems and services solutions from a single source provider.
For more information, please visit the company's website at www.mistrasgroup.com or contact Frank Joyce, Chief Financial Officer at 609-716-4103.
The MISTRAS Group, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=6966
Forward-Looking and Cautionary Statements
Certain statements made in this press release are "forward-looking statements" about Mistras' financial results and estimates, products and services, business model, strategy, growth opportunities, profitability and competitive position. These forward-looking statements generally use words such as "future," "possible," "potential," "targeted," "anticipate," "believe," "estimate," "expect," "intend," "plan," "predict," "project," "will," "may," "should," "could," "would" and other similar words and phrases. Such statements are not guarantees of future performance or results, and will not necessarily be accurate indications of the times at, or by which, such performance or results will be achieved, if at all. These statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in these statements. A list, description and discussion of these and other risks and uncertainties can be found in the "Risk Factors" section of the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission on August 12, 2011, as updated by the Company's reports on Form 10-Q and Form 8-K. The forward-looking statements are made as of the date hereof, and Mistras undertakes no obligation to update such statements as a result of new information, future events or otherwise.
* Use of Non-GAAP Measures
The term "Adjusted EBITDA" is a financial measurement not calculated in accordance with U.S. generally accepted accounting principles. The Company believes that investors and other users of the financial statements benefit from the presentation of Adjusted EBITDA because it provides an additional metric to compare the Company's operating performance on a consistent basis and measure underlying trends and results of the Company's business. A reconciliation of Adjusted EBITDA to a financial measurement under GAAP is set forth in a table attached to this press release.
| Mistras Group, Inc. | ||
| Unaudited Consolidated Balance Sheets | ||
| (in thousands, except share data) | ||
| November 30, 2011 | May 31, 2011 | |
| ASSETS | ||
| Current Assets | ||
| Cash and cash equivalents | $ 5,319 | $ 10,879 |
| Restricted cash | 3,700 | -- |
| Accounts receivable, net | 102,782 | 78,031 |
| Inventories, net | 10,997 | 9,830 |
| Deferred income taxes | 1,280 | 1,278 |
| Prepaid expenses and other current assets | 8,305 | 6,761 |
| Total current assets | 132,383 | 106,779 |
| Property, plant and equipment, net | 54,216 | 49,168 |
| Intangible assets, net | 27,826 | 27,304 |
| Goodwill | 71,814 | 64,146 |
| Other assets | 1,323 | 1,240 |
| Total assets | $ 287,562 | $ 248,637 |
| LIABILITIES, PREFERRED STOCK AND EQUITY | ||
| Current Liabilities | ||
| Current portion of long-term debt | $ 5,733 | $ 7,226 |
| Current portion of capital lease obligations | 6,339 | 5,853 |
| Accounts payable | 6,171 | 6,656 |
| Accrued expenses and other current liabilities | 33,118 | 28,028 |
| Income taxes payable | 1,925 | 2,825 |
| Total current liabilities | 53,286 | 50,588 |
| Long-term debt, net of current portion | 34,191 | 14,625 |
| Obligations under capital leases, net of current portion | 12,283 | 9,623 |
| Deferred income taxes | 2,916 | 2,863 |
| Other long-term liabilities | 3,702 | 3,452 |
| Total liabilities | 106,378 | 81,151 |
| Commitments and contingencies | ||
| Preferred stock, 10,000,000 shares authorized | -- | -- |
| Equity | ||
| Common stock, $0.01 par value, 200,000,000 shares authorized, 27,916,036 and 27,667,122 shares issued and outstanding as of November 30, 2011 and May 31, 2011, respectively | 279 | 277 |
| Additional paid-in capital | 184,553 | 180,594 |
| Accumulated deficit | (2,833) | (14,017) |
| Accumulated other comprehensive (loss) income | (1,065) | 303 |
| Total Mistras Group, Inc. stockholders' equity | 180,934 | 167,157 |
| Noncontrolling interest | 250 | 329 |
| Total equity | 181,184 | 167,486 |
| Total liabilities, preferred stock and equity | $ 287,562 | $ 248,637 |
| Mistras Group, Inc. | ||||
| Unaudited Consolidated Statement of Operations | ||||
| (in thousands, except per share data) | ||||
| Three months ended November 30, | Six months ended November 30, | |||
| 2011 | 2010 | 2011 | 2010 | |
| Revenues: | ||||
| Services | $ 103,942 | $ 82,953 | $ 186,844 | $ 144,205 |
| Products | 10,278 | 5,884 | 18,823 | 13,042 |
| Total revenues | 114,220 | 88,837 | 205,667 | 157,247 |
| Cost of revenues: | ||||
| Cost of services | 71,047 | 55,667 | 127,934 | 97,058 |
| Cost of products sold | 4,216 | 2,067 | 7,856 | 5,344 |
| Depreciation related to services | 3,556 | 3,136 | 6,879 | 5,945 |
| Depreciation related to products | 186 | 159 | 363 | 314 |
| Total cost of revenues | 79,005 | 61,029 | 143,032 | 108,661 |
| Gross profit | 35,215 | 27,808 | 62,635 | 48,586 |
| Selling, general and administrative expenses | 19,378 | 15,615 | 38,759 | 31,094 |
| Research and engineering | 602 | 569 | 1,191 | 1,124 |
| Depreciation and amortization | 1,503 | 1,326 | 2,982 | 2,504 |
| Acquisition-related costs | (339) | -- | (339) | -- |
| Legal reserve | -- | 101 | -- | 351 |
| Income from operations | 14,071 | 10,197 | 20,042 | 13,513 |
| Other expenses | ||||
| Interest expense | 1,145 | 671 | 1,806 | 1,361 |
| Income before provision for income taxes | 12,926 | 9,526 | 18,236 | 12,152 |
| Provision for income taxes | 5,008 | 3,818 | 7,124 | 4,872 |
| Net income | 7,918 | 5,708 | 11,112 | 7,280 |
| Net loss (income) attributable to noncontrolling interests, net of taxes | 38 | (30) | 72 | (10) |
| Net income attributable to Mistras Group, Inc. | $ 7,956 | $ 5,678 | $ 11,184 | $ 7,270 |
| Earnings per common share: | ||||
| Basic | $ 0.29 | $ 0.21 | $ 0.40 | $ 0.27 |
| Diluted | $ 0.28 | $ 0.21 | $ 0.39 | $ 0.27 |
| Weighted average common shares outstanding: | ||||
| Basic | 27,786 | 26,665 | 27,731 | 26,664 |
| Diluted | 28,600 | 26,816 | 28,417 | 26,795 |
| Mistras Group, Inc. | ||||
| Unaudited Operating Data by Segment | ||||
| (in thousands) | ||||
| Three months ended November 30, | Six months ended November 30, | |||
| 2011 | 2010 | 2011 | 2010 | |
| Revenues | ||||
| Services | $ 96,909 | $ 76,108 | $ 172,598 | $ 131,390 |
| Products and Systems | 9,092 | 5,228 | 16,605 | 10,538 |
| International | 11,857 | 9,350 | 21,630 | 18,390 |
| Corporate and eliminations | (3,638) | (1,849) | (5,166) | (3,071) |
| $ 114,220 | $ 88,837 | $ 205,667 | $ 157,247 | |
| Three months ended November 30, | Six months ended November 30, | |||
| 2011 | 2010 | 2011 | 2010 | |
| Gross profit | ||||
| Services | $ 27,053 | $ 21,753 | $ 47,361 | $ 36,754 |
| Products and Systems | 4,263 | 2,821 | 8,014 | 5,390 |
| International | 4,246 | 3,260 | 7,677 | 6,531 |
| Corporate and eliminations | (347) | (26) | (417) | (89) |
| $ 35,215 | $ 27,808 | $ 62,635 | $ 48,586 | |
| Mistras Group, Inc. | ||||
| Unaudited Reconciliation of Net Income Attributable to Mistras Group, Inc. to EBITDA and Adjusted EBITDA | ||||
| (in thousands) | ||||
| Three months ended November 30, | Six months ended November 30, | |||
| 2011 | 2010 | 2011 | 2010 | |
| EBITDA and Adjusted EBITDA data | ||||
| Net income attributable to Mistras Group, Inc. | $ 7,956 | $ 5,678 | $ 11,184 | $ 7,270 |
| Interest expense | 1,145 | 671 | 1,806 | 1,361 |
| Provision for income taxes | 5,008 | 3,818 | 7,124 | 4,872 |
| Depreciation and amortization | 5,245 | 4,621 | 10,224 | 8,763 |
| EBITDA | $ 19,354 | $ 14,788 | $ 30,338 | $ 22,266 |
| Stock Compensation | 1,545 | 1,047 | 2,547 | 1,776 |
| Acquisition-related costs | (339) | -- | (339) | -- |
| Legal reserve | -- | 101 | -- | 351 |
| Adjusted EBITDA | $ 20,560 | $ 15,936 | $ 32,546 | $ 24,393 |
CONTACT: Nestor S. Makarigakis
Manager of Marketing Communications
marcom@mistrasgroup.com
1(609)716-4000