Exhibit 99.1
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News Release |
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Graham Corporation 20 Florence Avenue Batavia, NY 14020
Graham Corporation Reports 19.8% Increase in Sales
for the Third Quarter of Fiscal 2009
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Net sales of $24.7 million in the quarter, up $4.1 million |
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On track for record year: Fiscal 2009 expected to be peak of current cycle; downturn
expected in fiscal 2010 |
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Strong balance sheet: $45.4 million in cash and investments and no long-term debt |
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Reaffirms fiscal 2009 revenue and margin guidance |
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Board authorizes stock repurchase program |
BATAVIA, NY, January 30, 2009 – Graham Corporation (NYSE-A: GHM), a manufacturer of critical
equipment for the oil refinery, petrochemical and power industries, today reported financial
results for its fiscal 2009 third quarter ended December 31, 2008. Net sales were $24.7 million in
the quarter, up $4.1 million, or 19.8%, compared with net sales of $20.6 million in the prior
year’s third quarter. Net income was $3.8 million, or $0.37 per diluted share, in the third
quarter, approximately the same as net income in the same period the prior fiscal year. Graham’s
fiscal 2009 ends March 31, 2009.
Mr. James R. Lines, President and Chief Executive Officer of Graham, commented, “Our third quarter
financial results were in line with our expectations and support our previously announced outlook
that fiscal 2009 would be a record year for sales and earnings. However, we believe that fiscal
2009 will represent the peak of the current cycle that began for us in the latter half of fiscal
2004. We took measured steps during the current cycle to control our growth, to maintain a solid
balance sheet and to make important gains in productivity. We expect that these gains will help to
reduce the effect of declining revenue as we head into fiscal 2010. Moreover, we believe that our
strong balance sheet and expected operating performance during fiscal 2010 will allow us to
maintain a strong financial position that will enable us to take advantage of opportunities that
may present themselves during the downturn.”
Sales on Track for Record Fiscal Year
The increase in third quarter sales of ejectors, heat exchangers and pump packages was offset
slightly by a decrease in sales of condensers and aftermarket products. Ejector sales were $10.3
million, or 41.6% of total net sales, in the third quarter, a 47.7% increase compared with $7.0
million, or 33.8% of total net sales, in the same period during the prior year. The increase in
ejector sales reflects a greater number of oil refinery projects in the period.
Higher sales of heat exchangers were driven by more focused sales activities that targeted a wider
variety of end markets. Heat exchanger sales increased 23.9% year-over-year to $3.0 million, or
12.1% of total net sales, in the third quarter compared with $2.4 million, or 11.7% of total net
sales, in the same period the prior fiscal year. Pump package sales increased three-fold to $1.8
million, or 7.5% of total net sales, in the third quarter compared with $0.6 million, or 2.9% of
net sales, in the third quarter of fiscal 2008. The timing of customer requirements for repair
parts impacted our aftermarket product sales, which decreased 21.8% to $2.8 million, or 11.3% of
total net sales, in the third quarter of fiscal 2009, compared with $3.6 million, or 17.3% of total
net sales, in the prior fiscal year’s third quarter.
Sales of condensers declined in the third quarter to $6.8 million, or 27.5% of total net sales,
compared with $7.1 million, or 34.3% of total net sales, in the same period the prior fiscal year,
as the petrochemical industry slowed during the latter part of 2008.
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| Graham Corporation Reports 19.8% Increase in Sales for the Third Quarter of Fiscal 2009 |
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| January 30, 2009
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U.S. sales were $14.4 million, or 58% of total sales, in the third quarter, compared with $10.7
million, or 52% of total sales, in the same quarter of fiscal 2008. International sales were $10.3
million, or 42% of total sales, in the third quarter, slightly above $9.9 million, or 48%, in the
same quarter a year ago. Increased sales to Canada, the Middle East and Western Europe were mostly
offset by decreases in sales to South and Central America and Asia. Fluctuations in sales among
products and geographic locations can vary measurably from quarter-to-quarter based on the timing
and magnitude of projects, and we generally do not believe that such fluctuations are indicative of
business trends.
By industry, 46% of sales in the third quarter were to the refining industry, compared with 38% in
the same period the prior fiscal year. Approximately 27% of sales were to the
chemical/petrochemical industry and 21% to other industrial applications during the current
quarter, as compared with 42% and 19%, respectively, in the third quarter of fiscal 2008. Power
industry sales accounted for 6% of sales during the third quarter of fiscal 2009, while that
industry represented approximately one percent of sales during the same period the prior year.
Additional historical information regarding sales by industry and region are contained in the
tables at the end of this news release.
Managing Operational Effectiveness
Gross profit was $9.4 million, or 37.9% of sales, in the third quarter of fiscal 2009, compared
with $8.6 million, or 41.9% of sales, in the same period the prior fiscal year. The decline in
margin during the quarter occurred as a result of a contract in process requiring international
fabrication that carried a lower margin than those in the same quarter of fiscal 2008.
Approximately 8% of manufacturing production hours were outsourced in the third quarter of fiscal
2009.
Selling, general and administrative (“SG&A”) expenses were $3.6 million, or 14.4% of sales, in the
third quarter of fiscal 2009 compared with $3.2 million, or 15.7% of sales, in the third quarter of
fiscal 2008, but were below SG&A expenses of $3.9 million, or 16.4% of sales in the trailing second
quarter of fiscal 2009. Costs related to Graham’s ongoing initiatives to improve manufacturing
efficiencies and increased bonus and commission accruals, as a result of higher sales and net
income, caused the slight increase in SG&A expenses in the current fiscal year quarter compared
with the same quarter in the prior year.
Taking into account current backlog, the new order environment and the productivity gains made over
the past several years, in January of 2009 Graham eliminated approximately 5% of its workforce.
Graham believes that the elimination of these positions better align its operating structure and
costs. A $365 thousand restructuring charge is expected to be recognized in the fourth quarter of
fiscal 2009, and on-going cost savings are expected to be approximately $2.0 million per year.
Excluding the restructuring charge, for the remainder of fiscal 2009, SG&A expenses are expected to
be in the range of 15% to 16% of sales.
Mr. Lines noted, “We’ve reduced our cost structure as we enter a period of declining revenue. We
will, however, remain disciplined about our ongoing internal improvement efforts. The personnel
reductions we made in January were difficult but necessary. We believe we are prepared for the
downturn and view it as an opportunity to continue to drive improvement into the company,
strengthen our relationships with customers, capture additional market share, enter new markets and
be able to take greater advantage of the next up-cycle.”
Interest income in the third quarter of fiscal 2009 declined to $83 thousand compared with
$304 thousand in the same period the prior fiscal year, primarily as a result of a significant
decline in current treasury yields compared with a year ago.
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| Graham Corporation Reports 19.8% Increase in Sales for the Third Quarter of Fiscal 2009 |
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| January 30, 2009
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Page 3 |
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Graham has revised its estimated fiscal 2009 effective tax rate upward by half a percentage point
to 34% in light of the actual rates experienced on its recently-filed tax returns which resulted in
an effective tax rate for the third quarter of fiscal 2009 of 35.5%.
Nine-Month Review
Net sales for the first nine months of fiscal 2009 were $76.3 million, up 19.8% compared with $63.7
million in the first nine months of fiscal 2008. Gross margin was 42.1% for the nine-month period
compared with 39.6% in the same period the prior fiscal year. Higher aftermarket sales,
particularly in the first quarter, improved product mix and engineering and manufacturing operating
efficiencies all contributed to the year-over-year increase. Approximately 9% of manufacturing
production hours were outsourced in the first nine months of fiscal 2009. Graham expects that
outsourced manufacturing hours will be between 8% and 10% for the full fiscal year 2009.
SG&A expenses were $11.3 million, or 14.8% of sales, in the first nine months of fiscal 2009
compared with $9.8 million, or 15.3% of sales, in the same period of fiscal 2008. The increase was
related to higher variable compensation costs and outside consulting fees.
Net income for the first nine months of fiscal 2009 was up 28.1% to $13.9 million, compared with
$10.8 million in the same period the prior year. On a per diluted share basis, net income grew to
$1.36, a 25.9% increase over $1.08 in the same period the prior fiscal year.
Strong, Flexible Balance Sheet with Significant Cash Position
Cash, cash equivalents and investments at December 31, 2008 were $45.4 million, compared with
$36.8 million at March 31, 2008 and $42.9 million at September 30, 2008. Net cash provided by
operating activities was $7.4 million in the first nine months of fiscal 2009, compared with $16.0
million in the same period the prior fiscal year. The year-over-year decrease was a result of
higher working capital requirements, primarily from an increase in Graham’s accounts receivable
balance due to the timing of customer billings. Approximately $41.2 million was invested in United
States Treasury notes with maturity periods of 91 to 180 days at December 31, 2008. As of December
31, 2008, Graham had no borrowings and $7.5 million of outstanding letters of credit under its
$30.0 million revolving line of credit facility.
Capital expenditures were $398 thousand in the third quarter of fiscal 2009 and $1.2 million for
the nine-month period, compared with $212 thousand and $659 thousand in the third quarter and
nine-month period of fiscal 2008, respectively. Capital expenditures for the full-year fiscal 2009
are expected to be in the range of $1.8 to $2.0 million, of which approximately 50% will be
allocated for machinery and equipment, 40% for information technology and 10% for other
expenditures. An estimated 75% of the fiscal 2009 capital spending is expected to be used for
productivity improvements and the remaining 25% for capitalized maintenance and other general
purposes.
Addressing the Down Slope of a Cycle
Orders began to slow during September and October as the world reacted to the unprecedented
worldwide financial crisis and the seizure of capital markets, and we experienced a rapid and
severe decline in order activity in November and December. While we maintain our strong market position, orders
received in the third quarter of fiscal 2009, net of cancellations, were an unusually low $8.1
million compared with orders of $26.6 million in the same period the prior fiscal year. Oil
refiners have curtailed or cancelled many projects as they evaluate the changing outlook on demand
for oil and its many by-products resulting from the worldwide
economic slowdown. Because of the magnitude of certain individual orders and shipment timing, there
can be significant variability in sales and orders from quarter-to-quarter. Graham does not believe such fluctuations
are indicative of business trends.
Graham’s backlog was $52.5 million at December 31, 2008, down 16.7% compared with $63.0 million at
December 31, 2007. Backlog was reduced by $1.6 million due to the cancellation of an order for a
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| Graham Corporation Reports 19.8% Increase in Sales for the Third Quarter of Fiscal 2009 |
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| January 30, 2009
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Page 4 |
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refinery project. Included in backlog is approximately $5.7 million in orders for refinery
projects that customers have currently suspended subject to their further review of the related
projects. Approximately 45% of projects in backlog are for refinery projects, 33% for chemical and
petrochemical projects and 22% for power and other industrial commercial applications, compared
with 50%, 23% and 27%, respectively, at the end of the third quarter of fiscal 2008. Approximately
90% of backlog is expected to ship in the next twelve months.
“The significant decline during the quarter is the most severe quarter-over-quarter swing that I
have seen in the 25 years I have been with Graham. Since we may
experience significant variability in sales and orders from quarter-to-quarter,
we analyze business trends over multiple quarterly periods. For the nine-month period ended December 31, 2008,
we received $53.4 million in new orders. Nonetheless, we expect that we will be near
$100 million in sales for fiscal 2009, as we had previously projected, and expect gross margins
will be consistent with our previous guidance of approximately 39% to 42%.” stated Mr. Lines.
He added, “What is not clear is the extent or duration of the down slope of this new cycle. Oil
companies are reducing capital budgets by an estimated 12% for 2009 and many higher cost projects,
such as oil sands, have been cancelled. Petrochemical companies are facing difficult times and
investment in new capacity has been dramatically scaled down. Consequently, we are prepared for a
measurably lower level of sales in fiscal 2010. Notwithstanding current conditions, we continue to
believe that longer-term overall global growth will continue to drive demand for our products. We
expect that when the economic tide turns, the re-emergence of demand and expansion in the
petrochemical and oil refining industries will be more orderly and deliberate, and that the supply
chain will not become as over-extended as it did during this last cycle. In the past, we typically
saw demand begin to improve between six and eighteen months after the end of a recession.”
He concluded, “Strategically, our goal remains to double the size of Graham over the next three to
five years. Moreover, we see this downturn and our financial strength as an opportunity for us to
be very selective and effective with our acquisition strategy.”
Stock Buyback Program Authorized
On January 29, 2009, Graham's Board of Directors authorized a
stock repurchase program, permitting Graham to repurchase up to 1,000,000 shares of its common stock in open market and
privately negotiated transactions. Graham's repurchase program will continue until the earlier of July 29, 2009, until
such time that all 1,000,000 shares have been repurchased or until the Board of Directors terminates the program.
Graham intends to use cash on hand to fund any stock repurchases under the program.
Webcast and Conference Call
Graham will host a conference call and live webcast today at 11:00 a.m. ET. During the conference
call and webcast, James R. Lines, President and Chief Executive Officer, and Jennifer Condame,
Chief Accounting Officer, will review Graham’s financial and operating results for the third
quarter and first nine months of fiscal 2009 as well as Graham’s strategy and outlook. A
question-and-answer session will follow.
Graham’s conference call and live webcast can be accessed as follows:
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The live webcast can be found at http://www.graham-mfg.com. Participants should
go to the website 10 -15 minutes prior to the scheduled conference in order to
register and download any necessary audio software. |
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The teleconference can be accessed by dialling 1-201-689-8560 and referencing
conference ID number 309815 approximately 5 — 10 minutes prior to the call. |
The conference call and webcast will be archived and can be reviewed as follows:
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The webcast will be archived at http://www.graham-mfg.com and a transcript will
be posted once available. The webcast and transcript will remain available on the
website for approximately 30 days. |
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A replay can be heard by calling 1-201-612-7415, and entering the account number
3055 and conference ID number 309815. The telephonic replay will be available
through
February 6, 2009 at 11:59 p.m. Eastern Time. |
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| Graham Corporation Reports 19.8% Increase in Sales for the Third Quarter of Fiscal 2009 |
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| January 30, 2009
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Page 5 |
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ABOUT GRAHAM CORPORATION
With world-renowned engineering expertise in vacuum and heat transfer technology, Graham
Corporation is a global designer, manufacturer and supplier of ejectors, pumps, condensers, vacuum
systems and heat exchangers. Over the past 72 years, Graham has built a reputation for top
quality, reliable products and high-standards of customer service. Sold either as components or
complete system solutions, the principal markets for Graham’s equipment are the petrochemical, oil
refining and electric power generation industries, including cogeneration and geothermal plants.
Graham’s equipment can be found in diverse applications, such as metal refining, pulp and paper
processing, ship-building, water heating, refrigeration, desalination, food processing,
pharmaceutical, heating, ventilating and air conditioning.
Graham Corporation’s reach spans the globe. Its equipment is installed in facilities from North
and South America to Europe, Asia, Africa and the Middle East. Graham routinely posts news and
other important information on its website, www.graham-mfg.com, where additional comprehensive
information on the Company can be found.
Safe Harbor Regarding 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. Forward-looking statements are subject to risks, uncertainties and assumptions and are
identified by words such as “expects,” “estimates,” “projects,” “anticipates,” “believes,” “could,”
and other similar words. All statements addressing operating performance, events, or developments
that Graham Corporation expects or anticipates will occur in the future, including but not limited
to, statements relating to anticipated revenues, profit margins, foreign sales operations, its
strategy to build its global sales representative channel, the effectiveness of automation in
expanding its engineering capacity, its ability to improve cost competitiveness, customer
preferences, changes in market conditions in the industries in which Graham Corporation operates,
changes in general economic conditions and customer behavior and Graham Corporation’s acquisition
strategy are forward-looking statements. Because they are forward-looking, they should be evaluated
in light of important risk factors and uncertainties. These risk factors and uncertainties are more
fully described in Graham Corporation’s most recent Annual and Quarterly Reports filed with the
Securities and Exchange Commission, including under the heading entitled “Risk Factors.” Should
one or more of these risks or uncertainties materialize, or should any of Graham Corporation’s
underlying assumptions prove incorrect, actual results may vary materially from those currently
anticipated. In addition, undue reliance should not be placed on Graham Corporation’s
forward-looking statements. Except as required by law, Graham Corporation disclaims any obligation
to update or publicly announce any revisions to any of the forward-looking statements contained in
this press release.
For more information contact:
Deborah K. Pawlowski, Kei Advisors LLC
Phone: (716) 843-3908
Email: dpawlowski@keiadvisors.com
FINANCIAL TABLES FOLLOW.
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| January 30, 2009
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Page 6 |
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Graham Corporation Third Quarter Fiscal 2009
Consolidated Statements of Operations and Retained Earnings
(Amounts in thousands, except per share data)
(Unaudited)
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Three Months Ended |
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Nine Months Ended |
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December 31, |
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December 31, |
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2008 |
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2007 |
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2008 |
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2007 |
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(Amounts in thousands, except per share data) |
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Net sales |
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$ |
24,701 |
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$ |
20,625 |
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$ |
76,263 |
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$ |
63,672 |
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Cost of products sold |
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15,339 |
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11,978 |
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44,184 |
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38,449 |
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Gross profit |
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9,362 |
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8,647 |
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32,079 |
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25,223 |
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Gross profit margin |
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37.9 |
% |
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41.9 |
% |
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42.1 |
% |
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39.6 |
% |
Other expenses: |
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Selling, general and administrative |
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3,567 |
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3,239 |
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11,320 |
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9,756 |
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Operating profit |
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5,795 |
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5,408 |
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20,759 |
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15,467 |
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Operating profit margin |
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23.5 |
% |
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26.2 |
% |
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27.2 |
% |
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24.3 |
% |
Interest income |
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(83 |
) |
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(304 |
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(386 |
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(799 |
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Interest expense |
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1 |
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1 |
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4 |
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9 |
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Total other expenses and income |
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3,485 |
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2,936 |
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10,938 |
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8,966 |
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Income before income taxes |
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5,877 |
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5,711 |
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21,141 |
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16,257 |
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Provision for income taxes |
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2,087 |
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1,948 |
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7,255 |
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5,414 |
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Net income |
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3,790 |
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3,763 |
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13,886 |
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10,843 |
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Retained earnings at beginning of period |
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46,995 |
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29,559 |
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37,216 |
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22,675 |
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Dividends |
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(203 |
) |
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(148 |
) |
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(557 |
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(344 |
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Effect of adoption of measurement date
provisions of Statement of Financial
Accounting Standards No. 158 |
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— |
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— |
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37 |
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— |
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Retained earnings at end of period |
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$ |
50,582 |
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$ |
33,174 |
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$ |
50,582 |
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$ |
33,174 |
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Per share data: |
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Basic: |
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Net income |
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$ |
.37 |
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$ |
.38 |
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$ |
1.37 |
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$ |
1.10 |
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Diluted: |
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Net income |
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$ |
.37 |
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$ |
.37 |
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$ |
1.36 |
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$ |
1.08 |
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Weighted average common shares outstanding: |
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Basic: |
|
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10,181 |
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9,943 |
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|
10,145 |
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9,871 |
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Diluted: |
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10,211 |
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10,124 |
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10,221 |
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10,035 |
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Dividends declared per share |
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$ |
.02 |
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$ |
.015 |
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$ |
.055 |
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$ |
.035 |
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Graham Corporation Reports 19.8% Increase in Sales for the Third Quarter of Fiscal 2009
January 30, 2009
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Page 7 |
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Graham Corporation Third Quarter Fiscal 2009
Consolidated Balance Sheets
(Amounts in thousands, except per share data)
(Unaudited)
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December 31, |
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March 31, |
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2008 |
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2008 |
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(Amounts in thousands, except per share data) |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
4,229 |
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$ |
2,112 |
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Investments |
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41,152 |
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34,681 |
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Trade accounts receivable, net of allowances ($21 and
$41 at December 31, and March 31, 2008, respectively) |
|
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8,419 |
|
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|
5,052 |
|
Unbilled revenue |
|
|
8,556 |
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|
|
8,763 |
|
Inventories |
|
|
5,019 |
|
|
|
4,797 |
|
Income taxes receivable |
|
|
618 |
|
|
|
1,502 |
|
Prepaid expenses and other current assets |
|
|
826 |
|
|
|
463 |
|
|
|
|
|
|
|
|
Total current assets |
|
|
68,819 |
|
|
|
57,370 |
|
Property, plant and equipment, net |
|
|
9,615 |
|
|
|
9,060 |
|
Deferred income tax asset |
|
|
156 |
|
|
|
70 |
|
Prepaid pension asset |
|
|
7,015 |
|
|
|
4,186 |
|
Other assets |
|
|
16 |
|
|
|
25 |
|
|
|
|
|
|
|
|
Total assets |
|
$ |
85,621 |
|
|
$ |
70,711 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and stockholders’ equity |
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
|
|
Current portion of capital lease obligations |
|
$ |
27 |
|
|
$ |
20 |
|
Accounts payable |
|
|
4,056 |
|
|
|
5,461 |
|
Accrued compensation |
|
|
4,156 |
|
|
|
4,517 |
|
Accrued expenses and other liabilities |
|
|
1,949 |
|
|
|
2,114 |
|
Customer deposits |
|
|
6,080 |
|
|
|
5,985 |
|
Deferred income tax liability |
|
|
2,275 |
|
|
|
2,275 |
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
18,543 |
|
|
|
20,372 |
|
|
|
|
|
|
|
|
|
|
Capital lease obligations |
|
|
39 |
|
|
|
36 |
|
Accrued compensation |
|
|
241 |
|
|
|
232 |
|
Deferred income tax liability |
|
|
1,344 |
|
|
|
315 |
|
Accrued pension liability |
|
|
259 |
|
|
|
271 |
|
Accrued postretirement benefits |
|
|
941 |
|
|
|
949 |
|
|
|
|
|
|
|
|
Total liabilities |
|
|
21,367 |
|
|
|
22,175 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
Preferred stock, $1.00 par value – Authorized, 500 shares |
|
|
|
|
|
|
|
|
Common stock, $.10 par value — Authorized, 25,500 and
6,000 shares at December 31 and March 31, 2008,
respectively
Issued 10,127 and 9,982 shares at December 31 and
March 31, 2008, respectively |
|
|
1,013 |
|
|
|
499 |
|
Capital in excess of par value |
|
|
14,866 |
|
|
|
12,674 |
|
Retained earnings |
|
|
50,582 |
|
|
|
37,216 |
|
Accumulated other comprehensive loss |
|
|
(2,163 |
) |
|
|
(1,820 |
) |
Other |
|
|
(44 |
) |
|
|
(33 |
) |
|
|
|
|
|
|
|
Total stockholders’ equity |
|
|
64,254 |
|
|
|
48,536 |
|
|
|
|
|
|
|
|
Total liabilities and stockholders’ equity |
|
$ |
85,621 |
|
|
$ |
70,711 |
|
|
|
|
|
|
|
|
- MORE-
|
|
|
Graham Corporation Reports 19.8% Increase in Sales for the Third Quarter of Fiscal 2009
January 30, 2009
|
|
Page 8 |
| |
|
|
Graham Corporation Third Quarter Fiscal 2009
Condensed Consolidated Statements of Cash Flows
(Dollar amounts in thousands)
(Unaudited)
| |
|
|
|
|
|
|
|
|
| |
|
Nine Months Ended |
|
| |
|
December 31, |
|
| |
|
2008 |
|
|
2007 |
|
| |
|
(Amounts in thousands) |
|
Operating activities: |
|
|
|
|
|
|
|
|
Net income |
|
$ |
13,886 |
|
|
$ |
10,843 |
|
|
|
|
|
|
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
|
826 |
|
|
|
706 |
|
Discount accretion on investments |
|
|
(371 |
) |
|
|
(693 |
) |
Stock-based compensation expense |
|
|
315 |
|
|
|
125 |
|
Loss on disposal of property, plant and equipment |
|
|
2 |
|
|
|
— |
|
Deferred income taxes |
|
|
1,178 |
|
|
|
3,035 |
|
(Increase) decrease in operating assets: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(3,365 |
) |
|
|
4,248 |
|
Unbilled revenue |
|
|
208 |
|
|
|
507 |
|
Inventories |
|
|
(222 |
) |
|
|
173 |
|
Income taxes receivable/payable |
|
|
884 |
|
|
|
(687 |
) |
Prepaid expenses and other current and non-current assets |
|
|
(358 |
) |
|
|
(376 |
) |
Prepaid pension asset |
|
|
(3,630 |
) |
|
|
(2,028 |
) |
Increase (decrease) in operating liabilities: |
|
|
|
|
|
|
|
|
Accounts payable |
|
|
(1,483 |
) |
|
|
(1,866 |
) |
Accrued compensation, accrued expenses and other current and non-current
liabilities |
|
|
(531 |
) |
|
|
214 |
|
Customer deposits |
|
|
82 |
|
|
|
1,745 |
|
Long-term portion of accrued compensation, accrued pension liability
and accrued postretirement benefits |
|
|
24 |
|
|
|
68 |
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
|
|
7,445 |
|
|
|
16,014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing activities: |
|
|
|
|
|
|
|
|
Purchase of property, plant and equipment |
|
|
(1,193 |
) |
|
|
(659 |
) |
Proceeds from sale of property, plant and equipment |
|
|
1 |
|
|
|
44 |
|
Purchase of investments |
|
|
(102,550 |
) |
|
|
(65,271 |
) |
Redemption of investments at maturity |
|
|
96,450 |
|
|
|
49,750 |
|
|
|
|
|
|
|
|
Net cash used by investing activities |
|
|
(7,292 |
) |
|
|
(16,136 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing activities: |
|
|
|
|
|
|
|
|
Proceeds from issuance of long-term debt |
|
|
2,450 |
|
|
|
69 |
|
Principal repayments on long-term debt |
|
|
(2,471 |
) |
|
|
(97 |
) |
Issuance of common stock |
|
|
695 |
|
|
|
970 |
|
Dividends paid |
|
|
(557 |
) |
|
|
(344 |
) |
Excess tax deduction on stock awards |
|
|
1,696 |
|
|
|
1,198 |
|
Other |
|
|
(10 |
) |
|
|
39 |
|
|
|
|
|
|
|
|
Net cash provided by financing activities |
|
|
1,803 |
|
|
|
1,835 |
|
|
|
|
|
|
|
|
Effect of exchange rates on cash |
|
|
161 |
|
|
|
30 |
|
|
|
|
|
|
|
|
Net increase in cash and cash equivalents |
|
|
2,117 |
|
|
|
1,743 |
|
Cash and cash equivalents at beginning of period |
|
|
2,112 |
|
|
|
1,375 |
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period |
|
$ |
4,229 |
|
|
$ |
3,118 |
|
|
|
|
|
|
|
|
-MORE-
|
|
|
Graham Corporation Reports 19.8% Increase in Sales for the Third Quarter of Fiscal 2009
January 30, 2009
|
Page 9 |
| |
|
|
Graham Corporation Third Quarter Fiscal 2009
Additional Information
ORDER AND BACKLOG TREND
($, in millions)
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9-Months |
| |
|
Q108 |
|
Q208 |
|
Q308 |
|
Q408 |
|
FY 2008 |
|
Q109 |
|
Q209 |
|
Q309 |
|
FY2009 |
| |
|
6/30/07 |
|
9/30/07 |
|
12/31/07 |
|
3/31/08 |
|
3/31/08 |
|
6/30/08 |
|
9/30/08 |
|
12/31/08 |
|
12/31/08 |
Orders |
|
$ |
24.9 |
|
|
$ |
20.5 |
|
|
$ |
26.6 |
|
|
$ |
35.1 |
|
|
$ |
107.1 |
|
|
$ |
27.8 |
|
|
$ |
17.5 |
|
|
$ |
8.1 |
|
|
$ |
53.4 |
|
Backlog |
|
$ |
59.2 |
|
|
$ |
56.8 |
|
|
$ |
63.0 |
|
|
$ |
75.7 |
|
|
$ |
75.7 |
|
|
$ |
76.0 |
|
|
$ |
69.7 |
|
|
$ |
52.5 |
|
|
$ |
52.5 |
|
SALES BY INDUSTRY FISCAL 2009
($, in millions)
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9-Months |
|
|
| |
|
Q109 |
|
% |
|
Q209 |
|
% |
|
Q309 |
|
% |
|
FY2009 |
|
% |
| |
|
6/30/08 |
|
Total |
|
9/30/08 |
|
Total |
|
12/31/08 |
|
Total |
|
12/31/08 |
|
Total |
Refining |
|
$ |
14.4 |
|
|
|
52 |
% |
|
$ |
11.1 |
|
|
|
47 |
% |
|
$ |
11.3 |
|
|
|
46 |
% |
|
$ |
36.8 |
|
|
|
48 |
% |
Chem/ Petrochemical |
|
$ |
5.3 |
|
|
|
19 |
% |
|
$ |
6.4 |
|
|
|
27 |
% |
|
$ |
6.6 |
|
|
|
27 |
% |
|
$ |
18.3 |
|
|
|
24 |
% |
Power |
|
$ |
1.3 |
|
|
|
5 |
% |
|
$ |
2.0 |
|
|
|
8 |
% |
|
$ |
1.5 |
|
|
|
6 |
% |
|
$ |
4.8 |
|
|
|
6 |
% |
Other |
|
$ |
6.6 |
|
|
|
24 |
% |
|
$ |
4.4 |
|
|
|
18 |
% |
|
$ |
5.3 |
|
|
|
21 |
% |
|
$ |
16.4 |
|
|
|
22 |
% |
Total |
|
$ |
27.6 |
|
|
|
|
|
|
$ |
23.9 |
|
|
|
|
|
|
$ |
24.7 |
|
|
|
|
|
|
$ |
76.3 |
|
|
|
|
|
SALES BY INDUSTRY FISCAL 2008
($, in millions)
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Q108 |
|
% |
|
Q208 |
|
% |
|
Q308 |
|
% |
|
Q408 |
|
% |
|
FY 2008 |
|
% |
| |
|
6/30/07 |
|
Total |
|
9/30/07 |
|
Total |
|
12/31/07 |
|
Total |
|
3/31/08 |
|
Total |
|
3/31/08 |
|
Total |
Refining |
|
$ |
9.7 |
|
|
|
48 |
% |
|
$ |
12.0 |
|
|
|
52 |
% |
|
$ |
7.8 |
|
|
|
38 |
% |
|
$ |
7.5 |
|
|
|
33 |
% |
|
$ |
37.0 |
|
|
|
43 |
% |
Chem/ Petrochemical |
|
$ |
4.6 |
|
|
|
23 |
% |
|
$ |
6.5 |
|
|
|
28 |
% |
|
$ |
8.5 |
|
|
|
42 |
% |
|
$ |
7.3 |
|
|
|
32 |
% |
|
$ |
26.9 |
|
|
|
31 |
% |
Power |
|
$ |
0.8 |
|
|
|
4 |
% |
|
$ |
0.4 |
|
|
|
2 |
% |
|
$ |
0.1 |
|
|
|
1 |
% |
|
$ |
0.1 |
|
|
|
0 |
% |
|
$ |
1.4 |
|
|
|
2 |
% |
Other |
|
$ |
4.9 |
|
|
|
25 |
% |
|
$ |
4.2 |
|
|
|
18 |
% |
|
$ |
4.1 |
|
|
|
19 |
% |
|
$ |
7.9 |
|
|
|
35 |
% |
|
$ |
21.1 |
|
|
|
24 |
% |
Total |
|
$ |
20.0 |
|
|
|
|
|
|
$ |
23.1 |
|
|
|
|
|
|
$ |
20.5 |
|
|
|
|
|
|
$ |
22.8 |
|
|
|
|
|
|
$ |
86.4 |
|
|
|
|
|
-MORE-
Graham Corporation Reports 19.8% Increase in Sales for the Third Quarter of Fiscal 2009
January 30, 2009
SALES BY REGION FISCAL 2009
($, in millions)
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9-Months |
|
|
| |
|
Q109 |
|
% |
|
Q209 |
|
% |
|
Q309 |
|
% |
|
FY 2009 |
|
% |
| |
|
6/30/08 |
|
Total |
|
9/30/08 |
|
Total |
|
12/31/08 |
|
Total |
|
12/31/08 |
|
Total |
North America |
|
$ |
20.9 |
|
|
|
76 |
% |
|
$ |
17.0 |
|
|
|
71 |
% |
|
$ |
16.6 |
|
|
|
67 |
% |
|
$ |
54.4 |
|
|
|
71 |
% |
Middle East |
|
$ |
2.0 |
|
|
|
7 |
% |
|
$ |
3.0 |
|
|
|
13 |
% |
|
$ |
2.8 |
|
|
|
11 |
% |
|
$ |
7.8 |
|
|
|
10 |
% |
Asia |
|
$ |
3.0 |
|
|
|
11 |
% |
|
$ |
1.0 |
|
|
|
4 |
% |
|
$ |
3.7 |
|
|
|
15 |
% |
|
$ |
7.8 |
|
|
|
10 |
% |
Other |
|
$ |
1.7 |
|
|
|
6 |
% |
|
$ |
2.9 |
|
|
|
12 |
% |
|
$ |
1.6 |
|
|
|
7 |
% |
|
$ |
6.3 |
|
|
|
9 |
% |
Total |
|
$ |
27.6 |
|
|
|
|
|
|
$ |
23.9 |
|
|
|
|
|
|
$ |
24.7 |
|
|
|
|
|
|
$ |
76.3 |
|
|
|
|
|
SALES BY REGION FISCAL 2008
($, in millions)
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Q108 |
|
% |
|
Q208 |
|
% |
|
Q308 |
|
% |
|
Q408 |
|
% |
|
FY 2008 |
|
% |
| |
|
6/30/07 |
|
Total |
|
9/30/07 |
|
Total |
|
12/31/07 |
|
Total |
|
3/31/08 |
|
Total |
|
3/31/08 |
|
Total |
North America |
|
$ |
11.7 |
|
|
|
59 |
% |
|
$ |
17.8 |
|
|
|
77 |
% |
|
$ |
11.2 |
|
|
|
55 |
% |
|
$ |
12.0 |
|
|
|
53 |
% |
|
$ |
52.7 |
|
|
|
61 |
% |
Middle East |
|
$ |
4.2 |
|
|
|
21 |
% |
|
$ |
0.5 |
|
|
|
2 |
% |
|
$ |
1.6 |
|
|
|
8 |
% |
|
$ |
3.7 |
|
|
|
16 |
% |
|
$ |
10.0 |
|
|
|
11 |
% |
Asia |
|
$ |
2.5 |
|
|
|
12 |
% |
|
$ |
2.1 |
|
|
|
9 |
% |
|
$ |
3.9 |
|
|
|
19 |
% |
|
$ |
4.3 |
|
|
|
19 |
% |
|
$ |
12.8 |
|
|
|
15 |
% |
Other |
|
$ |
1.6 |
|
|
|
8 |
% |
|
$ |
2.7 |
|
|
|
12 |
% |
|
$ |
3.8 |
|
|
|
18 |
% |
|
$ |
2.8 |
|
|
|
12 |
% |
|
$ |
10.9 |
|
|
|
13 |
% |
Total |
|
$ |
20.0 |
|
|
|
|
|
|
$ |
23.1 |
|
|
|
|
|
|
$ |
20.5 |
|
|
|
|
|
|
$ |
22.8 |
|
|
|
|
|
|
$ |
86.4 |
|
|
|
|
|
10