Buckeye Technologies Reports 1Q Fiscal Year 2012 Results
Oct. 25, 2011 - Buckeye Technologies Inc. today announced first quarter adjusted net income of $29.9 million or $0.74 per share, which excludes net income of $11.2MM or $0.28 per share from cellulosic biofuel credits generated in 2009. Adjusted net income rose 118% as compared to the prior year period’s $13.7 million or $0.34 per share, which excluded net income of $51.3 million or $1.26 per share from cellulosic biofuel credits generated in 2009.
Net sales of $240 million were up 19% versus last year’s first quarter sales of $202 million. Sales benefited from higher selling prices and increased cotton linter pulp shipment volume. The $0.40 increase in adjusted EPS, compared to the prior year period, was driven by these same factors. Aside from significantly higher cotton linter costs, cost inflation for chemicals, transportation and other raw materials was modest with energy prices stable.
Comparing the first quarter of fiscal 2012 to the fourth quarter of fiscal 2011, sales were down $16 million or 6% lower as we rebuilt inventories at our Foley mill back to target levels and nonwovens shipment volume was down. Adjusted Operating Income was flat at $44.0 million even with the lower sales revenue as selling, research and administrative expenses and direct costs were down relative to the fourth quarter, and higher selling prices were sufficient to offset increases in input costs during the first quarter. Adjusted EPS* of $0.74 was up $0.06 compared to $0.68 in the fourth quarter. Adjusted EPS benefitted from a foreign exchange gain, lower net interest expense and a lower effective tax rate.
Chairman and Chief Executive Officer John B. Crowe said, “We were pleased with our first quarter fiscal 2012 financial results. As we said on our August earnings call, our record fourth quarter revenue of $256 million was going to be hard to duplicate in the first quarter due to very low beginning specialty wood fibers inventory levels. Our first quarter sales revenue of $240 million is our second best quarter ever, and our gross margin of 23.7% of sales was significantly better compared to last year’s 18.0%. The key drivers to year over year improvements continue to be strong markets and selling prices, better capacity utilization at our Memphis specialty cotton fibers plant, and benefits from our cost improvement initiatives. We maintained a balanced approach to the allocation of the cash flow generated during the quarter. Our excellent first quarter cash flow generation allowed us to pay a record bonus to all of our employees (reflecting the record FY 2011 performance), invest $11 million in capital projects, repurchase 356,000 shares ($8.6 million) of Buckeye common stock, increase our dividend to $0.06 per share, and further reduce our debt by $7 million. We expect strong sales, earnings and cash flow trends to continue.”
Buckeye, a leading manufacturer and marketer of specialty fibers and nonwoven materials, is headquartered in Memphis, Tennessee, USA. The Company currently operates facilities in the United States, Germany, Canada, and Brazil. Its products are sold worldwide to makers of consumer and industrial goods.
SOURCE: Buckeye Technologies Inc.