SAN DIEGO, Nov. 20, 2017 /PRNewswire/ -- Cubic Corporation
(NYSE: CUB) today announced its financial results for the fourth
quarter and fiscal year ended September 30, 2017.
"We are very pleased by our strong fourth quarter performance
with record sales, near-record Adjusted EBITDA and strong order
intake. With the recent New York Metropolitan Transportation
Authority contract win, we now have the highest backlog in the
company's history and are well positioned to deliver strong organic
growth," said Bradley H. Feldmann,
president and chief executive officer of Cubic Corporation. "Our
investments, innovation and overall strategy are paying off for our
customers, shareholders and employees."
Financial Results Comparison
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years
Ended
|
|
|
Three Months
Ended
|
|
|
|
September
30,
|
|
|
September
30,
|
|
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
|
|
(in
millions)
|
|
Sales
|
|
$
|
1,485.9
|
|
$
|
1,461.7
|
|
|
$
|
445.6
|
|
$
|
406.6
|
|
Operating
income
|
|
$
|
17.5
|
|
$
|
7.2
|
|
|
$
|
25.4
|
|
$
|
10.5
|
|
Adjusted EBITDA
(1)
|
|
$
|
105.6
|
|
$
|
118.0
|
|
|
$
|
50.2
|
|
$
|
35.7
|
|
Net income
(loss)
|
|
$
|
(11.2)
|
|
$
|
1.7
|
|
|
$
|
13.2
|
|
$
|
(7.5)
|
|
EPS
|
|
$
|
(0.41)
|
|
$
|
0.06
|
|
|
$
|
0.49
|
|
$
|
(0.29)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related
costs (excluding amortization) (2)
|
|
$
|
(0.3)
|
|
$
|
28.7
|
|
|
$
|
0.6
|
|
$
|
1.0
|
|
Strategic and IT
system resource planning expenses (2)
|
|
$
|
34.4
|
|
$
|
34.8
|
|
|
$
|
10.8
|
|
$
|
10.4
|
|
Depreciation and
amortization expense
|
|
$
|
51.1
|
|
$
|
45.5
|
|
|
$
|
12.9
|
|
$
|
13.5
|
|
Research and
development expense
|
|
$
|
52.7
|
|
$
|
32.0
|
|
|
$
|
13.9
|
|
$
|
13.8
|
|
Income tax provision
(benefit)
|
|
$
|
15.1
|
|
$
|
(9.2)
|
|
|
$
|
9.3
|
|
$
|
11.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Adjusted EBITDA is a
non-GAAP financial measure - see the section titled "Use of
Non-GAAP Financial Information" for additional information
regarding this non-GAAP financial measure.
|
(2)
|
See the section below
titled "Use of Non-GAAP Financial Information" for a description of
the composition of these items.
|
(3)
|
Guidance assumes a
constant currency basis with fiscal year 2017.
|
Cubic had record annual and quarterly sales of $1.486 billion for fiscal 2017 and $445.6 million for the fourth quarter. On a
constant currency basis, fiscal 2017 sales grew 3.0 percent
compared to the prior year. Fiscal 2017 sales were impacted by
$19.9 million of foreign currency
exchange rate headwinds compared to fiscal 2016.
The increase in operating income in the fourth quarter and full
year of fiscal 2017 was supported by higher sales. Operating income
for the full fiscal year was further positively impacted by a
reduction in general and administrative expenses, primarily
attributable to the decrease in acquisition-related expenses. The
increases in operating income for the fourth quarter and full
fiscal year were partially offset by significant acceleration of
investment in research and development (R&D) activity in
fiscal 2017.
The changes in Adjusted EBITDA for the fourth quarter and
full fiscal year are primarily attributable to the same matters
noted above that impacted operating income, with the exception of
the reduction in acquisition-related expenses, as
acquisition-related expenses are excluded from the calculation of
Adjusted EBITDA. The most significant matter that caused the
decrease in Adjusted EBITDA from fiscal 2016 to 2017 was a
$20.7 million relative increase in
R&D investment.
The change in net income was primarily caused by the change in
the effective tax rate. Cubic's income tax provision totaled
$15.1 million for fiscal 2017,
compared to an income tax benefit of $9.2
million in fiscal 2016. The tax benefit recorded in fiscal
2016 primarily related to acquired deferred tax liabilities of
$23.8 million that reduced the U.S.
valuation allowance. The expense for income taxes in fiscal 2017
primarily results from tax on foreign earnings and U.S. tax expense
related to the amortization of indefinite lived intangible assets,
partially offset by benefit related to the release of reserves for
uncertain tax positions due to the positions being effectively
settled. Due to the effects of the deferred tax asset valuation
allowance, the effective tax rate for fiscal 2016 and 2017 does not
correlate to the amount of the pre-tax income or loss.
Reportable Segment Results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years
Ended
|
|
Three Months
Ended
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
(in
millions)
|
|
Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cubic Transportation
Systems
|
|
$
|
578.6
|
|
$
|
586.4
|
|
$
|
170.7
|
|
$
|
155.9
|
|
Cubic Global Defense
Systems
|
|
|
529.1
|
|
|
484.2
|
|
|
178.4
|
|
|
152.9
|
|
Cubic Global Defense
Services
|
|
|
378.2
|
|
|
391.1
|
|
|
96.5
|
|
|
97.8
|
|
Total
sales
|
|
$
|
1,485.9
|
|
$
|
1,461.7
|
|
$
|
445.6
|
|
$
|
406.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
(loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cubic Transportation
Systems
|
|
$
|
39.8
|
|
$
|
57.5
|
|
$
|
23.2
|
|
$
|
13.6
|
|
Cubic Global Defense
Systems
|
|
|
18.8
|
|
|
(17.1)
|
|
|
14.8
|
|
|
6.6
|
|
Cubic Global Defense
Services
|
|
|
6.7
|
|
|
11.2
|
|
|
1.9
|
|
|
1.9
|
|
Unallocated corporate
expenses
|
|
|
(47.8)
|
|
|
(44.4)
|
|
|
(14.5)
|
|
|
(11.6)
|
|
Total operating
income
|
|
$
|
17.5
|
|
$
|
7.2
|
|
$
|
25.4
|
|
$
|
10.5
|
|
Cubic Transportation Systems:
Cubic Transportation Systems (CTS) sales and operating income
for the quarter were higher primarily due to the resolution of
negotiations to clarify pricing and service level provisions of
customer contracts. CTS had deferred revenue on these contracts
until such negotiations were complete.
The decrease in sales for fiscal 2017 compared to 2016 is due to
the adverse impacts of foreign currency exchange rates. CTS
operating income was lower for the full year due to increases in
R&D and bid preparation expenditures including $6.4 million of costs incurred in fiscal 2017 for
the development of advanced technologies that will be applied on a
contract with the New York Metropolitan Transit Authority that was
awarded in early fiscal 2018. Operating income in 2017 was also
negatively impacted by losses on a market-entry contract in the
road tolling industry.
Cubic Global Defense Systems:
Cubic Global Defense Systems (CGD Systems) sales were
positively affected by increases in product sales from acquired
businesses. Sales from businesses acquired by CGD Systems in 2016
and 2017 for the fourth quarter of fiscal 2017 were $39.7 million compared to $31.3 million for the fourth quarter
last year, and $108.9 million
for fiscal 2017 compared to $59.3
million for fiscal 2016. Operating income increased in the
fourth quarter and full year of fiscal 2017 due to increased sales
by those acquired businesses. Operating income for the full fiscal
year benefitted from an $8.0 million
gain recognized in the third quarter of fiscal 2017 related to the
approval of a contract adjustment with the U.S. Navy for a virtual
training system. The improvement in CGD Systems operating income
for fiscal 2017 compared to fiscal 2016 year was also
positively impacted by the effects of accounting for business
acquisitions. The increases in operating income for the fourth
quarter and full fiscal year were partially offset by increased
R&D expenditures in fiscal 2017, primarily for the development
of innovative ground live and virtual training technologies.
Cubic Global Defense Services:
Cubic Global Defense Services (CGD Services) sales and operating
income for the fourth quarter and full fiscal year were lower
primarily due to lower activity supporting Special Operations
Forces training as well as decreased activity on U.S. Army
contracts, other than the contract with the Joint Readiness
Training Center. In addition, certain contracts that were retained
after re-compete were won in the first quarter of fiscal 2017 at
reduced pricing. These reductions in operating profit were
partially offset by a decrease in the amortization expense on
purchased intangible assets.
Fiscal 2018 Guidance
- Sales guidance for fiscal 2018 of $1.51
billion to $1.56 billion.
- Adjusted EBITDA(1)(2) guidance of $110 million to $135 million(3). The
midpoint of this range represents a 16 percent increase from fiscal
2017.
"With our strong bookings and recent wins driven by our
investments in technology we are optimistic about the momentum
building in our business," said Anshooman Aga, executive vice
president and chief financial officer of Cubic Corporation.
Conference Call
Cubic management will host a conference call to discuss the
company's fourth quarter and fiscal 2017 results today,
Monday, November 20 at
4:30 p.m. EST/1:30 p.m. PST, which will be
simultaneously broadcast over the Internet. Bradley H. Feldmann, president and chief
executive officer, and Anshooman Aga, executive vice president and
chief financial officer, will host the call.
Conference Dial-In Information
Financial analysts and institutional investors interested in
participating in the call are invited to dial:
- (877) 407‑9708 for domestic callers
- (201) 689‑8259 for international callers
Please dial-in approximately 10 minutes prior to the start of
the call.
Audio Webcast
A live webcast of the conference call and presentation slides
will be accessible on our website under the "Investor Relations"
tab at www.cubic.com. Please visit the website at least 15 minutes
prior to the call in order to register, download and install
any streaming media software needed to listen to the
webcast. A replay of the broadcast will be available on the
"Investor Relations" tab of Cubic's website.
About Cubic Corporation
Cubic Corporation designs, integrates and operates systems,
products and services focused in the transportation, defense
training and secure communications markets. Cubic Transportation
Systems is a leading integrator of payment and information
technology and services to create intelligent travel solutions for
transportation authorities and operators. Cubic Global Defense is a
leading provider of live, virtual, constructive and game-based
training solutions, special operations and intelligence for the
U.S. and allied forces. Cubic Mission Solutions provides networked
Command, Control, Communications, Computers, Intelligence,
Surveillance and Reconnaissance (C4ISR) capabilities for defense,
intelligence, security and commercial missions. For more
information about Cubic, please visit the company's website
at www.cubic.com or on Twitter @CubicCorp.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
that are subject to the safe harbor created by such Act.
Forward-looking statements include, among others, statements about
our expectations regarding future events or our future financial
and/or operating performance; our expectations regarding organic
growth; and the use of our technologies on a transportation
contract that was awarded early fiscal 2018. These statements are
often, but not always, made through the use of words or phrases
such as "may," "will," "anticipate," "estimate," "plan," "project,"
"continuing," "ongoing," "expect," "believe," "intend," "predict,"
"potential," "opportunity" and similar words or phrases or the
negatives of these words or phrases. These statements involve
risks, estimates, assumptions and uncertainties that could cause
actual results to differ materially from those expressed in these
statements, including, among others: our dependence on U.S. and
foreign government contracts; delays in approving U.S. and foreign
government budgets and cuts in U.S. and foreign government defense
expenditures; the ability of certain government agencies to
unilaterally terminate or modify our contracts with them; the
effect of sequestration on our contracts; our assumptions
concerning behavior by public transit authorities; our ability to
successfully integrate new companies into our business and to
properly assess the effects of such integration on our financial
condition; the U.S. government's increased emphasis on awarding
contracts to small businesses, and our ability to retain existing
contracts or win new contracts under competitive bidding processes;
negative audits by the U.S. government; the effects of politics and
economic conditions on negotiations and business dealings in the
various countries in which we do business or intend to do business;
risks associated with the restatement of our prior consolidated
financial statements, including our identification of material
weaknesses in our internal control over financial reporting;
competition and technology changes in the defense and
transportation industries; the change in the way transit agencies
pay for transit systems; our ability to accurately estimate the
time and resources necessary to satisfy obligations under our
contracts; the effect of adverse regulatory changes on our ability
to sell products and services; our ability to identify, attract and
retain qualified employees; our failure to properly implement our
ERP system; unforeseen problems with the implementation and
maintenance of our information systems; business disruptions due to
cyber security threats, physical threats, terrorist acts, acts of
nature and public health crises; our involvement in litigation,
including litigation related to patents, proprietary rights and
employee misconduct; our reliance on subcontractors and on a
limited number of third parties to manufacture and supply our
products; our ability to comply with our development contracts and
to successfully develop, introduce and sell new products, systems
and services in current and future markets; defects in, or a lack
of adequate coverage by insurance or indemnity for, our products
and systems; and changes in U.S. and foreign tax laws, exchange
rates or our economic assumptions regarding our pension plans. In
addition, please refer to the risk factors contained in our SEC
filings available at www.sec.gov, including our most recent Annual
Report on Form 10‑K and Quarterly Reports on Form 10‑Q.
Because the risks, estimates, assumptions and uncertainties
referred to above could cause actual results or outcomes to differ
materially from those expressed in any forward-looking statements,
you should not place undue reliance on any forward-looking
statements. Any forward-looking statement speaks only as of the
date hereof, and, except as required by law, we undertake no
obligation to update any forward-looking statement to reflect
events or circumstances after the date hereof.
Use of Non-GAAP Financial Information
We believe that the presentation of Earnings before interest,
taxes, depreciation, and amortization (EBITDA) and Adjusted EBITDA
included in this report provides useful information to investors
with which to analyze our operating trends and performance and
ability to service and incur debt. Also, we believe EBITDA
facilitates company-to-company operating performance comparisons by
backing out potential differences caused by variations in capital
structures (affecting net interest expense), taxation, variations
in organic vs. inorganic growth (affecting amortization expense)
and the age and book depreciation of property, plant and equipment
(affecting relative depreciation expense). We believe Adjusted
EBITDA further facilitates company-to-company operating comparisons
by backing out items that we believe are not part of our core
operating performance. Items backed out of Adjusted EBITDA are
comprised of expenses incurred in the development of our ERP system
and the redesign of our supply chain which include internal labor
costs and external costs of materials and services that do not
qualify for capitalization, business acquisition expenses including
retention bonus expenses, due diligence and consulting costs
incurred in connection with the acquisitions, expenses recognized
related to the change in the fair value of contingent consideration
for acquisitions, restructuring costs, gains and losses on
disposals of fixed assets, and income and expenses classified as
other non-operating income and expenses which may vary for
different companies for reasons unrelated to operating
performance.
In addition, EBITDA and Adjusted EBITDA are key drivers of the
company's core operating performance and major factors in
management's bonus compensation each year. Management has
excluded the effects of these items in these measures to assist
investors in analyzing and assessing our past and future core
operating performance.
In addition, we believe that EBITDA and Adjusted EBITDA are
frequently used by securities analysts, investors and other
interested parties in their evaluation of companies, many of which
present EBITDA, Adjusted EBITDA and/or other adjusted measures when
reporting their results.
EBITDA and Adjusted EBITDA are not measurements of financial
performance under GAAP and should not be considered as alternatives
to net income as a measure of performance. In addition, other
companies may define EBITDA and Adjusted EBITDA differently and, as
a result, our measures of EBITDA and Adjusted EBITDA may not be
directly comparable to EBITDA and Adjusted EBITDA of other
companies. Furthermore, EBITDA and Adjusted EBITDA have limitations
as analytical tools, and you should not consider either of them in
isolation, or as a substitute for analysis of our results as
reported under GAAP.
Because of these limitations, EBITDA and Adjusted EBITDA should
not be considered as measures of discretionary cash available to us
to invest in the growth of our business. We compensate for these
limitations by relying primarily on our GAAP results and using
EBITDA and Adjusted EBITDA only supplementally. You are cautioned
not to place undue reliance on EBITDA or Adjusted EBITDA.
The following table reconciles EBITDA and Adjusted EBITDA to net
income (loss), which we consider to be the most directly comparable
GAAP financial measure to EBITDA and Adjusted EBITDA.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years
Ended
|
|
|
Three Months
Ended
|
|
|
|
|
September
30,
|
|
|
September
30,
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
(in
thousands)
|
|
Net income
(loss)
|
|
$
|
(11,209)
|
|
$
|
1,735
|
|
$
|
13,155
|
|
$
|
(7,493)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
|
14,033
|
|
|
9,723
|
|
|
2,550
|
|
|
3,472
|
|
Income
taxes
|
|
|
15,059
|
|
|
(9,212)
|
|
|
9,326
|
|
|
11,069
|
|
Depreciation and
amortization
|
|
|
51,099
|
|
|
45,478
|
|
|
12,945
|
|
|
13,535
|
|
EBITDA
|
|
|
68,982
|
|
|
47,724
|
|
|
37,976
|
|
|
20,583
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to
EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition related
expenses, excluding amortization
|
|
|
(274)
|
|
|
28,682
|
|
|
560
|
|
|
1,049
|
|
ERP system development
and supply chain process redesign expense
|
|
|
34,406
|
|
|
34,819
|
|
|
10,829
|
|
|
10,391
|
|
Restructuring
costs
|
|
|
2,468
|
|
|
1,852
|
|
|
518
|
|
|
237
|
|
Loss on sale of fixed
assets
|
|
|
405
|
|
|
-
|
|
|
-
|
|
|
-
|
|
Other non-operating
expense (income), net
|
|
|
(369)
|
|
|
4,972
|
|
|
353
|
|
|
3,440
|
|
Adjusted
EBITDA
|
|
$
|
105,618
|
|
$
|
118,049
|
|
$
|
50,236
|
|
$
|
35,700
|
|
Financial Statements
CUBIC
CORPORATION
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(amounts in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years Ended
September 30,
|
|
|
|
2017
|
|
2016
|
|
2015
|
|
Net sales:
|
|
|
|
|
|
|
|
|
|
|
Products
|
|
$
|
681,559
|
|
$
|
661,904
|
|
$
|
607,226
|
|
Services
|
|
|
804,302
|
|
|
799,761
|
|
|
823,819
|
|
|
|
|
1,485,861
|
|
|
1,461,665
|
|
|
1,431,045
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
|
|
|
Products
|
|
|
473,670
|
|
|
473,444
|
|
|
451,295
|
|
Services
|
|
|
648,472
|
|
|
643,462
|
|
|
640,031
|
|
Selling, general and
administrative expenses
|
|
|
258,088
|
|
|
269,593
|
|
|
212,518
|
|
Research and
development
|
|
|
52,652
|
|
|
31,976
|
|
|
17,992
|
|
Amortization of
purchased intangibles
|
|
|
32,997
|
|
|
34,120
|
|
|
27,550
|
|
Restructuring
costs
|
|
|
2,468
|
|
|
1,852
|
|
|
6,272
|
|
|
|
|
1,468,347
|
|
|
1,454,447
|
|
|
1,355,658
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
|
|
17,514
|
|
|
7,218
|
|
|
75,387
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expenses):
|
|
|
|
|
|
|
|
|
|
|
Interest and dividend
income
|
|
|
994
|
|
|
1,476
|
|
|
1,809
|
|
Interest
expense
|
|
|
(15,027)
|
|
|
(11,199)
|
|
|
(4,400)
|
|
Pension settlement
loss
|
|
|
—
|
|
|
(2,671)
|
|
|
—
|
|
Other income
(expense), net
|
|
|
369
|
|
|
(2,301)
|
|
|
(885)
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
|
|
3,850
|
|
|
(7,477)
|
|
|
71,911
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax provision
(benefit)
|
|
|
15,059
|
|
|
(9,212)
|
|
|
48,997
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
|
(11,209)
|
|
|
1,735
|
|
|
22,914
|
|
|
|
|
|
|
|
|
|
|
|
|
Less noncontrolling
interest in income of VIE
|
|
|
—
|
|
|
—
|
|
|
29
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Cubic
|
|
$
|
(11,209)
|
|
$
|
1,735
|
|
$
|
22,885
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.41)
|
|
$
|
0.06
|
|
$
|
0.85
|
|
Diluted
|
|
$
|
(0.41)
|
|
$
|
0.06
|
|
$
|
0.85
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares used in per share calculations:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
27,106
|
|
|
26,976
|
|
|
26,872
|
|
Diluted
|
|
|
27,106
|
|
|
27,040
|
|
|
26,938
|
|
CUBIC
CORPORATION
|
CONSOLIDATED BALANCE
SHEETS
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2017
|
|
2016
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
60,143
|
|
$
|
197,127
|
|
Restricted
cash
|
|
|
8,434
|
|
|
75,648
|
|
Marketable
securities
|
|
|
—
|
|
|
12,996
|
|
Accounts
receivable:
|
|
|
|
|
|
|
|
Trade and other
receivables
|
|
|
12,378
|
|
|
15,488
|
|
Long-term
contracts
|
|
|
416,808
|
|
|
367,419
|
|
Allowance for doubtful
accounts
|
|
|
(436)
|
|
|
(326)
|
|
|
|
|
428,750
|
|
|
382,581
|
|
|
|
|
|
|
|
|
|
Recoverable income
taxes
|
|
|
5,360
|
|
|
9,706
|
|
Inventories
|
|
|
87,715
|
|
|
66,362
|
|
Other current
assets
|
|
|
31,141
|
|
|
38,231
|
|
Total current
assets
|
|
|
621,543
|
|
|
782,651
|
|
|
|
|
|
|
|
|
|
Long-term contract
receivables
|
|
|
17,457
|
|
|
20,926
|
|
Long-term capitalized
contract costs
|
|
|
56,471
|
|
|
65,382
|
|
Property, plant and
equipment, net
|
|
|
113,686
|
|
|
96,316
|
|
Deferred income
taxes
|
|
|
2,206
|
|
|
2,194
|
|
Goodwill
|
|
|
415,912
|
|
|
406,946
|
|
Purchased
intangibles, net
|
|
|
98,495
|
|
|
123,403
|
|
Other
assets
|
|
|
10,515
|
|
|
6,590
|
|
Total
assets
|
|
$
|
1,336,285
|
|
$
|
1,504,408
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Short-term
borrowings
|
|
$
|
55,000
|
|
$
|
240,000
|
|
Trade accounts
payable
|
|
|
95,837
|
|
|
81,172
|
|
Customer
advances
|
|
|
57,477
|
|
|
49,481
|
|
Accrued
compensation
|
|
|
79,577
|
|
|
73,619
|
|
Other current
liabilities
|
|
|
78,750
|
|
|
74,071
|
|
Income taxes
payable
|
|
|
9,838
|
|
|
1,450
|
|
Current portion of
long-term debt
|
|
|
—
|
|
|
450
|
|
Total current
liabilities
|
|
|
376,479
|
|
|
520,243
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
|
199,761
|
|
|
200,291
|
|
Accrued pension
liability
|
|
|
25,375
|
|
|
46,865
|
|
Deferred
compensation
|
|
|
11,435
|
|
|
10,643
|
|
Income taxes
payable
|
|
|
7,465
|
|
|
11,855
|
|
Deferred income
taxes
|
|
|
10,407
|
|
|
3,980
|
|
Other non-current
liabilities
|
|
|
15,732
|
|
|
20,635
|
|
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders'
equity:
|
|
|
|
|
|
|
|
Preferred stock, no
par value:
|
|
|
|
|
|
|
|
Authorized--5,000 shares
|
|
|
|
|
|
|
|
Issued
and outstanding--none
|
|
|
|
|
|
|
|
Common
stock
|
|
|
|
|
|
|
|
Authorized--50,000
shares
|
|
|
|
|
|
|
|
36,072 issued and
27,127 outstanding at September 30, 2017
|
|
|
|
|
|
|
|
35,937 issued and
26,992 outstanding at September 30, 2016
|
|
|
37,850
|
|
|
32,756
|
|
Retained
earnings
|
|
|
794,485
|
|
|
813,035
|
|
Accumulated other
comprehensive loss
|
|
|
(106,626)
|
|
|
(119,817)
|
|
Treasury stock at cost
- 8,945 shares
|
|
|
(36,078)
|
|
|
(36,078)
|
|
Total shareholders'
equity
|
|
|
689,631
|
|
|
689,896
|
|
|
|
|
|
|
|
|
|
Total liabilities and
shareholders' equity
|
|
$
|
1,336,285
|
|
$
|
1,504,408
|
|
CUBIC
CORPORATION
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years Ended
September 30,
|
|
|
|
2017
|
|
2016
|
|
2015
|
|
Operating
Activities:
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
|
$
|
(11,209)
|
|
$
|
1,735
|
|
$
|
22,914
|
|
Adjustments to
reconcile net income (loss) to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
51,099
|
|
|
45,478
|
|
|
37,662
|
|
Share-based
compensation expense
|
|
|
5,269
|
|
|
8,762
|
|
|
8,325
|
|
Change in fair value
of contingent consideration
|
|
|
(3,878)
|
|
|
1,274
|
|
|
3,607
|
|
Loss on disposal of
assets
|
|
|
405
|
|
|
—
|
|
|
—
|
|
Deferred income
taxes
|
|
|
5,540
|
|
|
(23,988)
|
|
|
33,816
|
|
Net pension cost
(benefit)
|
|
|
(1,046)
|
|
|
1,102
|
|
|
(3,224)
|
|
Excess tax benefits
from equity incentive plans
|
|
|
(35)
|
|
|
3
|
|
|
33
|
|
Changes in operating
assets and liabilities, net of effects from
acquisitions:
|
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(40,015)
|
|
|
4,409
|
|
|
(2,230)
|
|
Inventories
|
|
|
(18,867)
|
|
|
(62)
|
|
|
(21,669)
|
|
Prepaid expenses and
other current assets
|
|
|
7,763
|
|
|
3,403
|
|
|
(15,045)
|
|
Long-term capitalized
contract costs
|
|
|
8,911
|
|
|
7,635
|
|
|
3,192
|
|
Accounts payable and
other current liabilities
|
|
|
10,919
|
|
|
19,874
|
|
|
25,599
|
|
Customer
advances
|
|
|
7,364
|
|
|
(24,900)
|
|
|
(10,200)
|
|
Income
taxes
|
|
|
8,240
|
|
|
(5,519)
|
|
|
8,847
|
|
Other items,
net
|
|
|
(5,724)
|
|
|
5,396
|
|
|
(1,938)
|
|
NET CASH PROVIDED BY
OPERATING ACTIVITIES
|
|
|
24,736
|
|
|
44,602
|
|
|
89,689
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing
Activities:
|
|
|
|
|
|
|
|
|
|
|
Acquisition of
businesses, net of cash acquired
|
|
|
(16,830)
|
|
|
(243,459)
|
|
|
(92,178)
|
|
Purchases of
marketable securities
|
|
|
(19,121)
|
|
|
(28,470)
|
|
|
(58,855)
|
|
Proceeds from sales or
maturities of marketable securities
|
|
|
31,868
|
|
|
43,456
|
|
|
51,173
|
|
Purchases of property,
plant and equipment
|
|
|
(36,932)
|
|
|
(32,093)
|
|
|
(22,202)
|
|
Proceeds from sale of
assets
|
|
|
1,233
|
|
|
—
|
|
|
—
|
|
Purchase of
non-marketable debt and equity securities
|
|
|
(2,700)
|
|
|
—
|
|
|
—
|
|
Purchases of other
assets
|
|
|
—
|
|
|
—
|
|
|
(2,993)
|
|
NET CASH USED IN
INVESTING ACTIVITIES
|
|
|
(42,482)
|
|
|
(260,566)
|
|
|
(125,055)
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing
Activities:
|
|
|
|
|
|
|
|
|
|
|
Proceeds from
short-term borrowings
|
|
|
130,780
|
|
|
288,900
|
|
|
111,300
|
|
Principal payments on
short-term borrowings
|
|
|
(315,780)
|
|
|
(108,900)
|
|
|
(51,300)
|
|
Proceeds from
long-term borrowings
|
|
|
—
|
|
|
75,000
|
|
|
25,000
|
|
Principal payments on
long-term debt
|
|
|
(978)
|
|
|
(494)
|
|
|
(537)
|
|
Deferred financing
fees
|
|
|
—
|
|
|
(3,647)
|
|
|
—
|
|
Stock issued under
employee stock purchase plan
|
|
|
2,234
|
|
|
—
|
|
|
—
|
|
Purchase of common
stock
|
|
|
(2,444)
|
|
|
(1,563)
|
|
|
(2,652)
|
|
Dividends
paid
|
|
|
(7,341)
|
|
|
(7,285)
|
|
|
(7,256)
|
|
Excess tax benefits
from equity incentive plans
|
|
|
35
|
|
|
(3)
|
|
|
(33)
|
|
Contingent
consideration payments related to acquisitions of
businesses
|
|
|
(2,625)
|
|
|
(2,479)
|
|
|
—
|
|
Purchase of
noncontrolling interest
|
|
|
—
|
|
|
—
|
|
|
(1,029)
|
|
Net change in
restricted cash
|
|
|
66,293
|
|
|
(6,403)
|
|
|
(189)
|
|
NET CASH PROVIDED BY
(USED IN) FINANCING ACTIVITIES
|
|
|
(129,826)
|
|
|
233,126
|
|
|
73,304
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange
rates on cash
|
|
|
10,588
|
|
|
(38,511)
|
|
|
(10,950)
|
|
|
|
|
|
|
|
|
|
|
|
|
NET INCREASE
(DECREASE) IN CASH AND CASH EQUIVALENTS
|
|
|
(136,984)
|
|
|
(21,349)
|
|
|
26,988
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents at the beginning of the period
|
|
|
197,127
|
|
|
218,476
|
|
|
191,488
|
|
|
|
|
|
|
|
|
|
|
|
|
CASH AND CASH
EQUIVALENTS AT THE END OF THE PERIOD
|
|
$
|
60,143
|
|
$
|
197,127
|
|
$
|
218,476
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosure of non-cash investing and financing
activities:
|
|
|
|
|
|
|
|
|
|
|
Liability incurred to
acquire Deltenna, net
|
|
$
|
1,327
|
|
$
|
—
|
|
$
|
—
|
|
Liability incurred to
acquire Vocality, net
|
|
$
|
271
|
|
$
|
—
|
|
$
|
—
|
|
Liability incurred to
acquire GATR, net
|
|
$
|
—
|
|
$
|
6,788
|
|
$
|
—
|
|
Liability incurred to
acquire TeraLogics, net
|
|
$
|
—
|
|
$
|
4,998
|
|
$
|
—
|
|
Liability incurred to
acquire H4 Global, net
|
|
$
|
—
|
|
$
|
952
|
|
$
|
—
|
|
Liability incurred to
acquire DTECH, net
|
|
$
|
—
|
|
$
|
—
|
|
$
|
11,808
|
|
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SOURCE Cubic Corporation