EX-99.1 2 exhibit9911262017.htm EXHIBIT 99.1 Exhibit

EXHIBIT 99.1
image00001a02a02a01a09.jpg 
News Release
 
205 Crosspoint Parkway
Getzville, NY 14068
Immediate Release     
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results

AMHERST, NY, January 26, 2017 - Columbus McKinnon Corporation (NASDAQ: CMCO), a leading designer, manufacturer and marketer of material handling products, technologies and services, today announced financial results for its fiscal year 2017 third quarter, which ended December 31, 2016.

Third Quarter Summary (compared with prior-year period, unless otherwise noted)
•
Revenue was $152.5 million; excluding unfavorable FX, revenue was $153.9 million
•
Gross profit of $44.8 million was negatively impacted by $1.3 million of atypical items; excluding those items, gross margin was 30.2%
•
STAHL CraneSystems acquisition scheduled to close on January 31, 2017; based on improved debt financing terms, acquisition is expected to be accretive to EPS by $0.34 in Fiscal 18 (before purchase accounting and charges)
•
Common equity offering to close with acquisition: net proceeds of $47.2 million reduce borrowing requirements for acquisition resulting in lower cost of debt at LIBOR plus 3.0%; also secured a $100 million revolver facility
•
Income from operations of $5.3 million included $3.1 million of expenses related to STAHL acquisition; adjusted income from operations was $8.5 million, or 5.5% of sales; atypical items had a 1.2% negative impact to margin
•
Repaid $5.7 million of debt in the quarter; net debt to net total capitalization down 1.0 percentage point from trailing quarter to 38.4%

Timothy T. Tevens, President and Chief Executive Officer, commented, “The quarter was weaker than we had anticipated, especially in the U.S. and EMEA, but our optimism for the longer term is not deterred. Our belief is that new product development combined with the Magnetek and STAHL acquisitions expand our competitive advantages and provides a stronger global market position as industrial economies strengthen.”

He continued, “We will be launching our ‘drive in every hoist’ strategic initiative with our Lodestar and Global King product lines in early Fiscal 2018. In addition, STAHL will measurably augment our reach into Europe with powered wire rope and electric chain hoists, as well as broaden our explosion-proof line of products globally. We have positioned the Company for future growth and profitably and are excited to leverage the breadth of our brands and product offerings to build a bigger business.”





Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 2 of 12

Third Quarter Review
Sales
($ in millions)
Q3 FY 17
 
Q3 FY 16
 
Change
 
% Change
Net sales
$
152.5

 
$
159.7

 
$
(7.2
)
 
(4.5
)%
   FX impact
$
1.4

 
 
 
 
 
 
Net sales excluding FX
$
153.9

 
 
 
$
(5.8
)
 
(3.7
)%
U.S. sales
$
98.1

 
$
102.6

 
$
(4.5
)
 
(4.4
)%
     % of total
64
%
 
64
%
 
 
 
 
Non-U.S. sales
$
54.4

 
$
57.1

 
$
(2.7
)
 
(4.7
)%
     % of total
36
%
 
36
%
 
 
 
 
   FX impact
$
1.4

 
 
 
 
 
 
Non-U.S. sales excluding FX
$
55.8

 
 
 
$
(1.3
)
 
(2.3
)%

Sales to the U.S. were impacted by lower volume when compared with the prior-year period. Non-U.S. sales were impacted by lower volume, partially offset by price increases.

Operating Results
($ in millions)
Q3 FY 17
 
Q3 FY 16
 
Change
 
% Change
Gross profit
$
44.8

 
$
48.3

 
$
(3.5
)
 
(7.3
)%
     Gross margin
29.4
%
 
30.3
%
 
(90) bps
 
 
Income from operations
$
5.3

 
$
11.0

 
$
(5.6
)
 
(51.5
)%
     Operating margin
3.5
%
 
6.9
%
 
(340) bps
 
 
Net income
$
0.5

 
$
7.2

 
$
(6.7
)
 
(93.0
)%
     Diluted EPS
$
0.02

 
$
0.36

 
$
(0.34
)
 
(94.4
)%

Gross profit was primarily down on lower sales volume, which had a $2.0 million negative impact. Atypical items in the quarter included higher product liability expense of $1.0 million, that includes a $0.5 million legal settlement, and severance expenses related to cost-saving initiatives. For more information on changes in gross profit, please see the attached tables.

Income from operations was $5.3 million. Adjusted income from operations of $8.5 million was down $4.0 million on weaker gross profit. Please see the attached tables for a reconciliation of GAAP income from operations to adjusted income from operations.

The effective tax rate of 67% was impacted by $3.1 million of non-deductible STAHL acquisition related costs. This also impacts the effective tax rate for the full year of fiscal 2017. It is now expected to be between 31% and 36%.

Net income was $0.5 million. Adjusted net income was $4.5 million, which excludes the STAHL acquisition related costs, a $1.8 million loss on the revaluation of the euro call option to hedge the STAHL purchase price, and a tax rate normalization adjustment. Adjusted net income reflects the impact of lower sales volume, lower gross profit margin due to atypical items as well as lower productivity and other cost changes. Please see the attached tables for a reconciliation of GAAP net income and earnings per share to adjusted net income and earnings per share.


2
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 3 of 12

Equity Financing Improves Acquisition Accretion; Strong Cash Generation Reduces Debt
During the quarter, the Company entered into a definitive agreement to sell 2,273,000 shares of its common stock in a private placement, which is expected to result in gross proceeds of $50.0 million and net proceeds of $47.2 million (after deducting transaction fees and expenses). The offering and related debt financing are expected to close in conjunction with the closing of the STAHL acquisition, which is planned for January 31, 2017.

Gregory P. Rustowicz, Vice President - Finance and Chief Financial Officer, noted, “The sale of common equity demonstrably improved the overall financing of the STAHL acquisition by reducing required borrowings and measurably lowering the interest rate on the debt. The debt financing is now expected to be an all first lien, $445 million term loan at a rate of LIBOR plus 3.0%. In addition, we have finalized a $100 million revolver which will provide additional liquidity for the Company. As a result, the STAHL acquisition is now expected to be $0.34 accretive to earnings in fiscal 2018 and $0.51 accretive to earnings in fiscal 2019 (before purchase accounting and charges). Our plan is to pay down $45 million to $50 million of debt in Fiscal 2018 and ramp the rate of debt reduction to $50 million to $55 million in Fiscal 2019 and beyond.”

Cash generated from operating activities in the third quarter was $22.9 million. Gross debt was $234.1 million at December 31, 2016 after $5.7 million of repayments during the quarter. The Company has repaid a total of $33.3 million of debt during the nine-month period ended December 31, 2016. Net debt to net total capitalization, which was 38.4% as of December 31, 2016, is down 4.6 percentage points since the beginning of the fiscal year.

Capital expenditures for the nine months ended December 31, 2016 were $11.3 million and are expected to be $16 million for fiscal 2017, unchanged from previous guidance.

Teleconference/webcast
Columbus McKinnon will host a conference call and live webcast today at 10:00 AM Eastern Time, at which Timothy T. Tevens, President and Chief Executive Officer, and Gregory P. Rustowicz, Vice President - Finance and Chief Financial Officer, will review the Company’s financial results and strategy. The review will be accompanied by a slide presentation, which will be available on Columbus McKinnon’s website at www.cmworks.com/investors. A question and answer session will follow the formal discussion.

Columbus McKinnon’s conference call can be accessed by calling 201-493-6780 and asking for the “Columbus McKinnon conference call.” The webcast can be monitored on Columbus McKinnon’s website at www.cmworks.com/investors. An audio recording of the call will be available two hours after its completion through Thursday, February 2, 2017 by dialing 412-317-6671 and entering the passcode 13652416. Alternatively, an archived webcast of the call can be found on the Company’s website. In addition, a transcript of the call will be posted to the website once available.

About Columbus McKinnon
Columbus McKinnon is a leading worldwide designer, manufacturer and marketer of material handling products, technologies, systems and services, which efficiently and ergonomically move, lift, position and secure materials and people. Key products include hoists, cranes, actuators, rigging tools, light rail work stations and digital power and motion control systems. The Company is focused on commercial and industrial applications that require the safety and quality provided by its superior design and engineering know-how. Comprehensive information on Columbus McKinnon is available on its website at http://www.cmworks.com.



3
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 4 of 12

Safe Harbor Statement
This news release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements concerning future revenue and earnings, involve known and unknown risks, uncertainties and other factors that could cause the actual results of the Company to differ materially from the results expressed or implied by such statements, including general economic and business conditions, conditions affecting the industries served by the Company and its subsidiaries, conditions affecting the Company's customers and suppliers, competitor responses to the Company's products and services, the overall market acceptance of such products and services, the effect of operating leverage, the pace of bookings relative to shipments, the ability to expand into new markets and geographic regions, the success in acquiring new business, the speed at which shipments improve, the effectiveness of new products and other factors disclosed in the Company's periodic reports filed with the Securities and Exchange Commission. The Company assumes no obligation to update the forward-looking information contained in this release.

Contacts:
Gregory P. Rustowicz
Investor Relations:
Vice President - Finance and Chief Financial Officer
Deborah K. Pawlowski
Columbus McKinnon Corporation
Kei Advisors LLC
716-689-5442
716-843-3908
greg.rustowicz@cmworks.com
dpawlowski@keiadvisors.com
 
Financial tables follow.

4
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 5 of 12

COLUMBUS McKINNON CORPORATION
Condensed Consolidated Income Statements - UNAUDITED
(In thousands, except per share and percentage data)
 


Three Months Ended


 

December 31, 2016

December 31, 2015

Change
Net sales

$
152,497


$
159,738


(4.5
)%
Cost of products sold

107,676


111,397


(3.3
)%
Gross profit

44,821


48,341


(7.3
)%
Gross profit margin

29.4
%

30.3
%

 

Selling expenses

17,988


19,295


(6.8
)%
% of net sales
 
11.8
%
 
12.1
%
 
 
General and administrative expenses

19,751


16,399


20.4
 %
% of net sales
 
13.0
%
 
10.3
%
 
 
Amortization of intangibles

1,765


1,689


4.5
 %
Income from operations

5,317


10,958


(51.5
)%
Operating margin

3.5
%

6.9
%

 

Interest and debt expense

2,299


2,425


(5.2
)%
Investment (income) loss

(61
)

(164
)

(62.8
)%
Foreign currency exchange (gain) loss

1,673


476


251.5
 %
Other (income) expense, net

(110
)

(189
)

(41.8
)%
Income before income tax expense

1,516


8,410


(82.0
)%
Income tax expense

1,011


1,183


(14.5
)%
Net income

$
505


$
7,227


(93.0
)%










Average basic shares outstanding

20,239


20,104


0.7
 %
Basic income per share

$
0.02


$
0.36


(94.4
)%










Average diluted shares outstanding

20,490


20,295


1.0
 %
Diluted income per share

$
0.02


$
0.36


(94.4
)%
 
 
 
 
 
 
 
Dividends declared per common share
 
$
0.04

 
$
0.04

 
 


5
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 6 of 12

COLUMBUS McKINNON CORPORATION
Condensed Consolidated Income Statements - UNAUDITED
(In thousands, except per share and percentage data)

 
 
Nine Months Ended
 
 
 
 
December 31, 2016
 
December 31, 2015
 
Change
Net sales
 
$
453,435

 
$
442,015

 
2.6
 %
Cost of products sold
 
310,838

 
303,145

 
2.5
 %
Gross profit
 
142,597

 
138,870

 
2.7
 %
Gross profit margin
 
31.4
%
 
31.4
%
 
 

Selling expenses
 
55,834

 
53,292

 
4.8
 %
% of net sales
 
12.3
%
 
12.1
%
 
 
General and administrative expenses
 
52,346

 
53,541

 
(2.2
)%
% of net sales
 
11.5
%
 
12.1
%
 
 
Amortization of intangibles
 
5,280

 
3,276

 
61.2
 %
Income from operations
 
29,137

 
28,761

 
1.3
 %
Operating margin
 
6.4
%
 
6.5
%
 
 

Interest and debt expense
 
7,398

 
5,213

 
41.9
 %
Investment (income) loss
 
(366
)
 
(668
)
 
(45.2
)%
Foreign currency exchange (gain) loss
 
890

 
1,750

 
(49.1
)%
Other (income) expense, net
 
(238
)
 
(302
)
 
(21.2
)%
Income before income tax expense
 
21,453

 
22,768

 
(5.8
)%
Income tax expense
 
7,731

 
9,078

 
(14.8
)%
Net income
 
$
13,722

 
$
13,690

 
0.2
 %
 
 
 
 
 
 
 
Average basic shares outstanding
 
20,192

 
20,071

 
0.6
 %
Basic income per share
 
$
0.68

 
$
0.68

 
—
 %
 
 
 
 
 
 
 
Average diluted shares outstanding
 
20,400

 
20,299

 
0.5
 %
Diluted income per share
 
$
0.67

 
$
0.67

 
—
 %
 
 
 
 
 
 
 
Dividends declared per common share
 
$
0.08

 
$
0.08

 
 


6
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 7 of 12

COLUMBUS McKINNON CORPORATION
Condensed Consolidated Balance Sheets
(In thousands)

 
 
December 31, 2016
 
March 31,
2016
 
 
(unaudited)
 
 
ASSETS
 
 
 
 
Current assets:
 
 
 
 
Cash and cash equivalents
 
$
51,538

 
$
51,603

Trade accounts receivable
 
74,853

 
83,812

Inventories
 
109,131

 
118,049

Prepaid expenses and other
 
16,293

 
19,265

Total current assets
 
251,815

 
272,729

 
 
 
 
 
Property, plant, and equipment, net
 
99,163

 
104,790

Goodwill
 
168,513

 
170,716

Other intangibles, net
 
117,002

 
122,129

Marketable securities
 
8,147

 
18,186

Deferred taxes on income
 
69,608

 
73,158

Other assets
 
11,364

 
11,143

Total assets
 
$
725,612

 
$
772,851

 
 
 
 
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
 
 

 
 

Current liabilities:
 
 

 
 

Trade accounts payable
 
$
28,209

 
$
36,061

Accrued liabilities
 
51,212

 
53,210

Current portion of long-term debt
 
13,051

 
43,246

Total current liabilities
 
92,472

 
132,517

 
 
 
 
 
Senior debt, less current portion
 
136

 
844

Term loan and revolving credit facility
 
220,946

 
223,542

Other non-current liabilities
 
119,735

 
129,639

Total liabilities
 
433,289

 
486,542

 
 
 
 
 
Shareholders’ equity:
 
 

 
 

Common stock
 
202

 
201

Additional paid-in capital
 
210,502

 
206,682

Retained earnings
 
186,277

 
174,173

Accumulated other comprehensive loss
 
(104,658
)
 
(94,747
)
Total shareholders’ equity
 
292,323

 
286,309

Total liabilities and shareholders’ equity
 
$
725,612

 
$
772,851



7
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 8 of 12

COLUMBUS McKINNON CORPORATION
Condensed Consolidated Statements of Cash Flows - UNAUDITED
(In thousands)
 
 
Nine Months Ended
 
 
December 31, 2016
 
December 31, 2015
Operating activities:
 
 
 
 
Net income
 
$
13,722

 
$
13,690

Adjustments to reconcile net income to net cash provided by operating activities:
 
 

 
 

Depreciation and amortization
 
17,695

 
13,872

Deferred income taxes and related valuation allowance
 
2,627

 
290

Net gain on sale of real estate, investments, and other
 
(116
)
 
(379
)
Stock based compensation
 
4,027

 
3,368

Amortization of deferred financing costs and discount on debt
 
515

 
428

Loss on revaluation of foreign exchange option
 
1,826

 
—

Changes in operating assets and liabilities, net of effects of business acquisitions:
 
 

 
 

Trade accounts receivable
 
6,909

 
13,451

Inventories
 
5,267

 
(790
)
Prepaid expenses and other
 
8,153

 
2,100

Other assets
 
(483
)
 
3,249

Trade accounts payable
 
(5,465
)
 
(9,713
)
Accrued liabilities
 
2,082

 
2,856

Non-current liabilities
 
(8,239
)
 
(9,520
)
Net cash provided by (used for) operating activities
 
48,520

 
32,902

 
 
 
 
 
Investing activities:
 
 

 
 

Proceeds from sale of marketable securities
 
10,336

 
5,732

Purchases of marketable securities
 
(242
)
 
(4,239
)
Capital expenditures
 
(11,274
)
 
(15,518
)
Purchase of business, net of cash acquired
 
(588
)
 
(182,467
)
Purchase of foreign exchange option
 
(6,370
)
 
—

Net cash provided by (used for) investing activities
 
(8,138
)
 
(196,492
)
 
 
 
 
 
Financing activities:
 
 

 
 

Proceeds from exercises of stock options
 
353

 
242

Net borrowings (repayments) under line-of-credit agreements
 
(23,500
)
 
164,057

Repayment of debt
 
(9,792
)
 
(9,854
)
Restricted cash related to purchase of business
 
(588
)
 
—

Dividends paid
 
(2,421
)
 
(2,408
)
Other
 
(558
)
 
(890
)
Net cash provided by (used for) financing activities
 
(36,506
)
 
151,147

 
 
 
 
 
Effect of exchange rate changes on cash
 
(3,941
)
 
1,268

 
 
 
 
 
Net change in cash and cash equivalents
 
(65
)
 
(11,175
)
Cash and cash equivalents at beginning of year
 
51,603

 
63,056

Cash and cash equivalents at end of period
 
$
51,538

 
$
51,881



8
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 9 of 12

COLUMBUS McKINNON CORPORATION
Q3 FY 2016 to Q3 FY 2017 Sales Bridge

 
 
Third Quarter
 
Year to Date
($ in millions)
 
$ Change
 
% Change
 
$ Change
 
% Change
Q3 Fiscal 2016 Sales
 
$159.7
 
 
 
$442.0
 
 
Magnetek acquisition
 
—
 
—%
 
40.3
 
9.1%
Pricing
 
0.2
 
0.1%
 
0.8
 
0.2%
Volume
 
(6.0)
 
(3.8)%
 
(25.6)
 
(5.8)%
Subtotal of change
 
(5.8)
 
(3.7)%
 
15.5
 
3.5%
Foreign currency translation
 
(1.4)
 
(0.8)%
 
(4.1)
 
(0.9)%
Total change
 
$(7.2)
 
(4.5)%
 
$11.4
 
2.6%
Q3 Fiscal 2017 Sales
 
$152.5
 

 
$453.4
 
 


COLUMBUS McKINNON CORPORATION
Q3 FY 2016 to Q3 FY 2017 Gross Profit Bridge

($ in millions)
Third Quarter
Year to Date
Q3 Fiscal 2016 Gross Profit
$48.3
$138.9
Magnetek Acquisition
—
14.2
Productivity, net of other cost changes
(1.2)
0.8
Prior year purchase accounting & restructuring costs
1.1
2.4
Pricing, net of material cost inflation
—
(0.2)
Product liability
(1.0)
(2.3)
Sales volume and mix
(2.0)
(10.0)
Subtotal of change
(3.1)
4.9
Foreign currency translation
(0.4)
(1.2)
Total change
$(3.5)
$3.7
Q3 Fiscal 2017 Gross Profit
$44.8
$142.6




9
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 10 of 12

COLUMBUS McKINNON CORPORATION
Additional Data - UNAUDITED
 
 
December 31,
2016
 
March 31,
2016
 
December 31,
2015
Backlog (in millions)
 
$
97.9

 
 
 
$
98.6

 
 
 
$
97.6

 
 
Project backlog (in millions, expected to ship beyond 3 months)
 
$
41.3

 
 
 
$
41.2

 
 
 
$
38.5

 
 
Project backlog as % of total backlog
 
42.2

 
%
 
41.8

 
%
 
39.4

 
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Trade accounts receivable
 
 

 
 
 
 

 
 
 
 

 
      
Days sales outstanding
 
44.7

 
days
 
49.2

 
days
 
46.5

 
days
 
 
 
 
 
 
 
 
 
 
 
 
 
Inventory turns per year
 
 

 
 
 
 

 
 
 
 

 
      
(based on cost of products sold)
 
3.9

 
turns
 
3.6

 
turns
 
3.7

 
turns
Days' inventory
 
93.6

 
days
 
101.0

 
days
 
98.6

 
days
 
 
 
 
 
 
 
 
 
 
 
 
 
Trade accounts payable
 
 

 
 
 
 

 
 
 
 

 
      
Days payables outstanding
 
23.8

 
days
 
30.8

 
days
 
24.3

 
days
 
 
 
 
 
 
 
 
 
 
 
 
 
Working capital as a % of sales (1)
 
19.9

 
%
 
21.5

 
%
 
21.6

 
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt to total capitalization percentage
 
44.5

 
%
 
48.3

 
%
 
50.0

 
%
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt, net of cash, to net total capitalization
 
38.4

 
%
 
43.0

 
%
 
44.9

 
%

(1) March 31, 2016 and December 31, 2015 figures exclude the impact of the acquisition of Magnetek

Shipping Days by Quarter 
 
 
Q1
 
Q2
 
Q3
 
Q4
 
Total
FY 18
 
63
 
62
 
60
 
63
 
248
 
 
 
 
 
 
 
 
 
 
 
FY 17
 
64
 
63
 
60
 
64
 
251
 
 
 
 
 
 
 
 
 
 
 
FY 16
 
63
 
64
 
60
 
63
 
250



10
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 11 of 12

COLUMBUS McKINNON CORPORATION
Reconciliation of GAAP Income from Operations to Non-GAAP Adjusted Income from Operations and Operating Margin
($ in thousands, except per share data)
 
Three Months Ended December 31,
 
Nine Months Ended December 31,
 
2016
 
2015
 
2016
 
2015
 
$
 
$
 
$
 
$
Income from operations
$5,317
 
$10,958
 
$29,137
 
$28,761
Add back:
 
 
 
 
 
 
 
     Canadian pension lump sum settlements
—
 
—
 
247
 
—
     Acquisition deal costs
3,140
 
414
 
3,140
 
5,746
     Acquisition related severance costs
—
 
—
 
—
 
2,300
     Acquisition inventory step-up expense
—
 
655
 
—
 
1,446
     Acquisition amortization of backlog
—
 
447
 
—
 
581
     European facility consolidation costs
—
 
—
 
—
 
585
Non-GAAP adjusted income from operations
$8,457
 
$12,474
 
$32,524
 
$39,419
 
 
 
 
 
 
 
 
Sales
152,497
 
159,738
 
453,435
 
442,015
Adjusted operating margin
5.5%
 
7.8%
 
7.2%
 
8.9%


Adjusted income from operations is defined as income from operations as reported, adjusted for certain items and to apply a normalized tax rate. Adjusted income from operations is not a measure determined in accordance with generally accepted accounting principles in the United States, commonly known as GAAP and may not be comparable to the measures as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP information, such as adjusted income from operations, is important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's income from operations to the historical periods' income from operations.


11
Columbus McKinnon Reports Third Quarter Fiscal Year 2017 Financial Results
January 26, 2017
Page 12 of 12

COLUMBUS McKINNON CORPORATION
Reconciliation of GAAP Net Income and Diluted Earnings per Share to Non-GAAP Adjusted Net Income and Diluted Earnings per Share
($ in thousands, except per share data)
 
Three Months Ended December 31,
 
Nine Months Ended December 31,
 
2016
 
2015
 
2016
 
2015
 
$
 
$
 
$
 
$
Net income
$505
 
$7,227
 
$13,722
 
$13,690
Add back:
 
 
 
 
 
 
 
    Canadian pension lump sum settlements
—
 
—
 
247
 
—
     Acquisition deal costs
3,140
 
414
 
3,140
 
5,746
     Loss on revaluation of foreign exchange option
1,826
 
—
 
1,826
 
—
     Acquisition related severance costs
—
 
—
 
—
 
2,300
     Acquisition inventory step-up expense
—
 
655
 
—
 
1,446
     Acquisition amortization of backlog
 
 
447
 
 
 
581
     European facility consolidation costs
—
 
—
 
—
 
585
     Normalize tax rate to 30% (1)
(934)
 
(1,795)
 
(269)
 
(950)
Non-GAAP adjusted net income
$4,537
 
$6,948
 
$18,666
 
$23,398
 
 
 
 
 
 
 
 
Average diluted shares outstanding
20,490
 
20,295
 
20,400
 
20,299
 
 
 
 
 
 
 
 
Diluted income per share - GAAP
$0.02
 
$0.36
 
$0.67
 
$0.67
 
 
 
 
 
 
 
 
Diluted income per share - Non-GAAP
$0.22
 
$0.34
 
$0.92
 
$1.15

(1) Applies a normalized tax rate of 30% to GAAP pre-tax income and non-GAAP adjustments above, which are each pre-tax.

Adjusted net income and diluted EPS are defined as net income and diluted EPS as reported, adjusted for certain items and to apply a normalized tax rate. Adjusted net income and diluted EPS are not measures determined in accordance with generally accepted accounting principles in the United States, commonly known as GAAP and may not be comparable to the measures as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP information, such as adjusted net income and diluted EPS, is important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year's net income and diluted EPS to the historical periods' net income and diluted EPS.

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