May 31, 2017   SOURCE: BusinessWire

Columbus McKinnon Reports Fourth Quarter Fiscal Year 2017 Financial Results

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 fourth quarter, which ended March 31, 2017. Fiscal year 2017 fourth quarter and full year results include the January 31, 2017 acquisition of STAHL CraneSystems (“STAHL”).

Fourth Quarter and Fiscal Year Highlights

  • Sales for the quarter were $183.7 million, up 18.4%; excluding acquisitions, organic revenue was up 2.5%
  • Generated $60.5 million in cash from operations in the year; paid down $12.8 million in borrowings during the quarter
  • STAHL integration on track to deliver $5 million in synergies in fiscal 2018
  • Plan to reduce debt by $45 million to $50 million in fiscal 2018 to achieve net debt to EBITDA ratio of 3x by end of fiscal 2018
  • Net loss was $4.7 million, or a loss of $0.22 per diluted share; adjusted net income was $8.9 million, or $0.40 per diluted share

Mark D. Morelli, President and CEO of Columbus McKinnon, commented, “I joined the Company at the end of February and I am encouraged that we ended our fiscal year on a strong note. We had volume growth and demonstrated our consistent ability to generate cash. We will utilize our future cash generation for debt reduction and growth initiatives. The recent acquisition of STAHL is strategically significant for us and the integration is progressing according to plan. STAHL is already proving to be an excellent addition, as it allows us to expand our business in Europe and add a leading global explosion-protected hoist product line.”

He continued, “In addition to the integration of STAHL, our priorities in fiscal 2018 are to strengthen our core business to drive profitable growth, further leverage Magnetek technology for better top-line growth, and reduce our debt.”

Fourth Quarter Review

Fourth Quarter Summary (compared with prior-year period, unless otherwise noted)

  • Sales excluding acquisitions increased $3.9 million, or 2.5%
  • Gross profit was $50.3 million, or 27.4% of sales; adjusted gross margin was 32.2%
  • Operating loss impacted by acquisition related inventory step-up expense of $8.9 million, acquisition deal costs of $5.7 million, and expenses related to the chief executive officer change of $3.1 million
  • Net loss was $4.7 million, or $0.22 loss per diluted share; adjusted net income was $8.9 million, or $0.40 per diluted share

Sales

($ in millions)           Q4 FY 17       Q4 FY 16       Change       % Change
Net sales $ 183.7 $ 155.1 $ 28.6 18.4 %
U.S. sales $ 103.5 $ 100.2 $ 3.3 3.3 %
% of total 56 % 65 %
Non-U.S. sales $ 80.2 $ 54.9 $ 25.3 46.1 %
% of total 44 % 35 %
 

STAHL's U.S. and non-U.S. sales were $1.5 million and $23.2 million, respectively. Volume improvement was realized in the U.S., Latin America, and the Asia Pacific region. Sales in Europe, excluding STAHL, were down slightly as a result of approximately $1.0 million in customer-related delays for a project in Africa.

Operating Results

($ in millions)           Q4 FY 17       Q4 FY 16       Change       % Change
Gross profit $ 50.3 $ 48.4 $ 1.9 4.0 %
Gross margin 27.4 % 31.2 % (380) bps
Income (loss) from operations $ (3.2 ) $ 11.8 $ (15.0 )
Operating margin (1.7 )% 7.6 % (930) bps
Net income (loss) $ (4.7 ) $ 5.9 $ (10.6 )
Diluted EPS $ (0.22 ) $ 0.29 $ (0.51 )
 

STAHL contributed $8.3 million to gross profit, which was offset by $8.9 million in acquisition related inventory step-up expense. Last year’s fourth quarter gross profit had approximately $1.5 million of adverse adjustments that did not recur in the current period. On an adjusted basis, gross margin was 32.2%, which is unchanged from the prior-year period. For more information on changes in gross profit, please see the attached tables. Please see the attached tables for a reconciliation of GAAP gross profit to adjusted gross profit.

Income from operations was a loss of $3.2 million. Adjusted income from operations was $16.9 million, which was up $2.7 million from the prior year. Excluding acquisition related inventory step-up expense, STAHL contributed $2.8 million to income from operations. Please see the attached tables for a reconciliation of GAAP income from operations to adjusted income from operations.

The effective tax rate for the quarter was 43.8%, which resulted in an income tax benefit of $3.7 million that reduced the loss in the quarter. The high rate in the quarter was due to the reversal of a valuation allowance on deferred tax assets in certain foreign subsidiaries, which more than offset the negative impact of non-deductible deal costs related to the STAHL acquisition. The full year tax rate was 31.0%. Given the geographic change in the mix of sales and income, the Company expects the effective tax rate for fiscal 2018 to be in the 21% to 25% range, excluding any changes to current tax regulations.

Net loss was $4.7 million. Adjusted net income was $8.9 million, which excludes the STAHL inventory step-up expense, STAHL deal and integration costs, CEO retirement pay and search costs, costs for a legal action against our prior product liability insurance carriers, the impairment of an intangible asset, and the loss on the extinguishment of debt. Please see the attached tables for a reconciliation of GAAP net income and earnings per share to adjusted net income and earnings per share.

Fiscal 2017 Summary (compared with prior year, unless otherwise noted)

  • Sales increased 6.7%, or $40.0 million, to $637.1 million; $65.0 million in acquired revenue partially offset by $20.6 million decline in volume
  • Gross profit was up $5.7 million to $192.9 million, or 30.3% of sales; adjusted gross margin was 31.7% of sales
  • Net income was $9.0 million; adjusted net income was $27.6 million, or $1.32 per diluted share; excludes net negative effect of $18.6 million, or $0.89 per diluted share, of unusual items, including acquisition related costs

Generating Cash, Reducing Working Capital Requirements and Reducing Debt

Cash generated from operating activities in the fourth quarter was $11.9 million. Inventory turns improved to 4.1 times and working capital as a percentage of sales was down to 18.6% compared with 21.5% a year earlier. Please see the attached table on page 10 of this release for further details.

Total debt was $421.3 million at March 31, 2017. Net debt to net total capitalization at March 31, 2017 was 50.2%.

Gregory P. Rustowicz, Vice President - Finance and Chief Financial Officer noted, “During the quarter, we paid down $12.8 million of borrowings. We are on track to generate sufficient cash to further reduce debt by $45 million to $50 million during fiscal 2018, while sufficiently funding operations and our dividend. This will allow us to achieve our targeted three times net debt to EBITDA ratio by fiscal 2018 year end.”

Capital expenditures for the year ended March 31, 2017 were $14.4 million. Capital investments for the year were primarily related to productivity enhancements, maintenance and the ERP system implementation. The Company expects capital expenditures in fiscal 2018 to be in the range of $20 million to $24 million.

Fiscal Year 2018 Outlook

Mr. Morelli concluded, “We are encouraged by the recent uptick in demand and we expect to make progress on further leveraging Magnetek and strengthening our core business. In addition, the STAHL acquisition provides an exciting opportunity to leverage our presence globally, especially in EMEA and in the explosion protected and highly engineered hoist category. Our focus remains on driving revenue and earnings from this acquisition.”

Teleconference/webcast

Columbus McKinnon will host a conference call and live webcast today at 10:00 AM Eastern Time, at which Mark D. Morelli, 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.

The conference call can be accessed by dialing 201-493-6780 and asking for the “Columbus McKinnon conference call.” The webcast can be monitored at www.cmworks.com/investors. An audio recording will be available from 1:00 PM Eastern Time on the day of the call through Wednesday, June 7, 2017 by dialing 412-317-6671 and entering the passcode 13659715. 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. 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 at http://www.cmworks.com.

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.

Financial tables follow.

 

COLUMBUS McKINNON CORPORATION

Condensed Consolidated Income Statements - UNAUDITED

(In thousands, except per share and percentage data)

 
          Three Months Ended      

March 31,
2017

     

March 31,
2016

Change
Net sales $ 183,688 $ 155,088 18.4 %
Cost of products sold 133,353   106,695   25.0 %
Gross profit 50,335 48,393 4.0 %
Gross profit margin 27.4 % 31.2 %
Selling expenses 21,485 19,566 9.8 %
% of net sales 11.7 % 12.6 %
General and administrative expenses 28,064 15,270 83.8 %
% of net sales 15.3 % 9.8 %
Impairment of intangible asset 1,125 — NM
Amortization of intangibles 2,825   1,748   61.6 %
Income from operations (3,164 ) 11,809   NM
Operating margin (1.7 )% 7.6 %
Interest and debt expense 3,568 2,691 32.6 %
Cost of debt refinancing 1,303 — NM
Investment (income) loss (96 ) (128 ) (25.0

)%

Foreign currency exchange (gain) loss 342 465 (26.5 )%
Other (income) expense, net 145   (75 ) NM
Income before income tax expense (8,426 ) 8,856 NM
Income tax expense (3,688 ) 2,967   NM
Net income (loss) $ (4,738 ) $ 5,889   NM
 
Average basic shares outstanding 21,809 20,108 8.5 %
Basic income (loss) per share $ (0.22 ) $ 0.29   NM
 
Average diluted shares outstanding 21,809 20,254 7.7 %
Diluted income (loss) per share $ (0.22 ) $ 0.29   NM
 
Dividends declared per common share $ 0.08   $ 0.08  
 
 

COLUMBUS McKINNON CORPORATION

Condensed Consolidated Income Statements - UNAUDITED

(In thousands, except per share and percentage data)

 
          Year Ended      

March 31,
2017

     

March 31,
2016

Change
Net sales $ 637,123 $ 597,103 6.7 %
Cost of products sold 444,191   409,840   8.4 %
Gross profit 192,932 187,263 3.0 %
Gross profit margin 30.3 % 31.4 %
Selling expenses 77,319 72,858 6.1 %
% of net sales 12.1 % 12.2 %
General and administrative expenses 80,410 68,811 16.9 %
% of net sales 12.6 % 11.5 %
Impairment of intangible asset 1,125 — NM
Amortization of intangibles 8,105   5,024   61.3 %
Income from operations 25,973   40,570   (36.0 )%
Operating margin 4.1 % 6.8 %
Interest and debt expense 10,966 7,904 38.7 %
Cost of debt refinancing 1,303 — NM
Investment (income) loss (462 ) (796 ) (42.0 )%
Foreign currency exchange (gain) loss 1,232 2,215 (44.4 )%
Other (income) expense, net (93 ) (377 ) (75.3 )%
Income before income tax expense 13,027 31,624 (58.8 )%
Income tax expense 4,043   12,045   (66.4 )%
Net income $ 8,984   $ 19,579   (54.1 )%
 
Average basic shares outstanding 20,591 20,079 2.5 %
Basic income per share $ 0.44   $ 0.98   (55.1 )%
 
Average diluted shares outstanding 20,888 20,315 2.8 %
Diluted income per share $ 0.43   $ 0.96   (55.2 )%
 
Dividends declared per common share $ 0.16   $ 0.16  
 
 

COLUMBUS McKINNON CORPORATION

Condensed Consolidated Balance Sheets

(In thousands)

 
         

March 31,
2017

   

March 31,
2016

(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 77,591 $ 51,603
Trade accounts receivable 111,569 83,812
Inventories 130,643 118,049
Prepaid expenses and other 21,147   19,265  
Total current assets 340,950   272,729  
 
Property, plant, and equipment, net 113,028 104,790
Goodwill 319,299 170,716
Other intangibles, net 256,183 122,129
Marketable securities 7,686 18,186
Deferred taxes on income 61,857 73,158
Other assets 14,840   11,143  
Total assets $ 1,113,843   $ 772,851  
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Trade accounts payable $ 40,994 $ 36,061
Accrued liabilities 97,397 53,210
Current portion of long-term debt 52,568   43,246  
Total current liabilities 190,959   132,517  
 
Senior debt, less current portion 41 844
Term loan and revolving credit facility 368,710 223,542
Other non-current liabilities 212,783   129,639  
Total liabilities 772,493   486,542  
 
Shareholders’ equity:
Common stock 226 201
Additional paid-in capital 258,853 206,682
Retained earnings 179,735 174,173
Accumulated other comprehensive loss (97,464 ) (94,747 )
Total shareholders’ equity 341,350   286,309  
Total liabilities and shareholders’ equity $ 1,113,843   $ 772,851  
 
 

COLUMBUS McKINNON CORPORATION

Condensed Consolidated Statements of Cash Flows - UNAUDITED

(In thousands)

 
      Year Ended
March 31, 2017     March 31, 2016
Operating activities:
Net income $ 8,984 $ 19,579
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 25,162 20,531
Deferred income taxes and related valuation allowance 489 7,336
Net gain on sale of real estate, investments, and other 14 34
Cost of debt refinancing 1,303 —
Impairment of assets — 429
Stock based compensation 5,914 4,063
Amortization of deferred financing costs and discount on debt 1,015 600
Purchase accounting adjustment related to working capital amortization 8,852 —
Net loss on foreign exchange option 1,590 —
Impairment of intangible asset 1,125 —
Changes in operating assets and liabilities, net of effects of business acquisitions:
Trade accounts receivable (785 ) 12,409
Inventories 8,173 2,483
Prepaid expenses and other 6,121 (375 )
Other assets (3,044 ) 3,179
Trade accounts payable 1,002 (5,308 )
Accrued liabilities (2,380 ) (5,799 )
Non-current liabilities (3,085 ) (6,516 )
Net cash provided by operating activities 60,450   52,645  
 
Investing activities:
Proceeds from sales of marketable securities 12,336 5,869
Purchases of marketable securities (1,571 ) (4,311 )
Capital expenditures (14,368 ) (22,320 )
Purchases of businesses, net of cash acquired (218,846 ) (182,467 )
Net loss on foreign exchange option (1,590 ) —  
Net cash provided by (used for) investing activities (224,039 ) (203,229 )
 
Financing activities:
Proceeds from the issuance of common stock 50,439 242
Net borrowings (repayments) under lines of credit (155,000 ) 154,057
Repayment of debt (125,730 ) (13,187 )
Proceeds from issuance of long-term debt 445,000 —
Fees related to debt and equity offerings (19,409 ) —
Restricted cash related to purchase of business (588 ) —
Payment of dividends (3,326 ) (3,212 )
Other (1,265 ) (897 )
Net cash provided by (used for) financing activities 190,121   137,003  
 
Effect of exchange rate changes on cash (544 ) 2,128  
 
Net change in cash and cash equivalents 25,988 (11,453 )
Cash and cash equivalents at beginning of year 51,603   63,056  
Cash and cash equivalents at end of period $ 77,591   $ 51,603  
 
 

COLUMBUS McKINNON CORPORATION

Q4 and Full Year FY 2017 Sales Bridge

 
          Fourth Quarter       Full Year
($ in millions) $ Change       % Change       $ Change       % Change
Fiscal 2016 Sales $ 155.1       $ 597.1
STAHL Acquisition 24.7 15.9 % 24.7 4.1 %
Volume 4.9 3.2 % (20.6 ) (3.3 )%
Pricing (0.1 ) (0.1 )% 0.7 0.1 %
Foreign currency translation (0.9 ) (0.6 )% (5.1 ) (0.9 )%
Magnetek Acquisition —   — % 40.3   6.7 %
Total change $ 28.6   18.4 % $ 40.0   6.7 %
Fiscal 2017 Sales $ 183.7   $ 637.1  
 
 

COLUMBUS McKINNON CORPORATION

Q4 and Full Year FY 2017 Gross Profit Bridge

 
($ in millions)          

Fourth
Quarter

      Full Year
Fiscal 2016 Gross Profit $ 48.4 $ 187.3
STAHL Acquisition 8.3 8.3
Prior year Non-GAAP adjustments 1.5 3.9
Productivity, net of other cost changes 1.2 2.0
Sales volume and mix 0.7 (9.3 )
Pricing, net of material cost inflation (0.3 ) (0.5 )
Product liability (0.3 ) (2.5 )
Foreign currency translation (0.3 ) (1.6 )
STAHL inventory step-up expense (8.9 ) (8.9 )
Magnetek Acquisition —   14.2  
Total change $ 1.9   $ 5.6  
Fiscal 2017 Gross Profit $ 50.3   $ 192.9  
 
 

COLUMBUS McKINNON CORPORATION

Additional Data - UNAUDITED

 
         

March 31,

2017

     

December 31,

2016

     

March 31,

2016

($ in millions)

 

Backlog $ 154.5 $ 97.9 $ 98.6
Backlog (excluding STAHL) $ 107.7 $ 97.9 $ 98.6
Long-term backlog (expected to ship beyond 3 months) $ 53.5 $ 41.3 $ 41.2
Long-term backlog as % of total backlog 34.6 % 42.2 % 41.8 %
 
Trade accounts receivable (1)
Days sales outstanding 46.2 days 44.7 days

 

49.2

days
 
Inventory turns per year (1)
(based on cost of products sold) 4.1 turns 3.9 turns 3.6 turns
Days' inventory (1) 89.0 days 93.6 days 101.0 days
 
Trade accounts payable (1)
Days payables outstanding 28.3 days 23.8 days

 

30.8

days
 
Working capital as a % of sales (1) (2) 18.6 % 19.9 % 21.5 %
 
Debt to total capitalization percentage 55.2 % 44.5 % 48.3 %
 
Debt, net of cash, to net total capitalization 50.2 % 38.4 % 43.0 %
(1)   March 31, 2017 figures exclude the impact of the acquisition of STAHL.
(2) March 31, 2016 figure excludes 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
 
 

COLUMBUS McKINNON CORPORATION

Reconciliation of GAAP Gross Profit to

Non-GAAP Adjusted Gross Profit and Margin

($ in thousands)

 
         

Three Months Ended
March 31,

      Year Ended
March 31,
2017       2016       2017       2016
Gross profit $ 50,335 $ 48,393 $ 192,932       $ 187,263
Add back:
Acquisition inventory step-up expense 8,852 — 8,852 1,446
Product liability costs for legal settlement — 1,100 — 1,100
Building held for sale impairment charge — 429 — 429
Magnetek acquisition amortization of backlog — — — 581
European facility consolidation costs —         —         —         346  
Non-GAAP adjusted gross profit $ 59,187         $ 49,922         $ 201,784         $ 191,165  
 
Sales $ 183,688 $ 155,088 $ 637,123 $ 597,103
Adjusted gross margin 32.2 % 32.2 % 31.7 % 32.0 %

Adjusted gross profit is defined as gross profit as reported, adjusted for certain items. Adjusted gross profit 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 measure as used by other companies. Nevertheless, Columbus McKinnon believes that providing non-GAAP information such as adjusted gross profit is important for investors and other readers of the Company’s financial statements, and assists in understanding the comparison of the current quarter’s gross profit to the historical period’s gross profit, as well as facilitates a more meaningful comparison of the Company’s gross profit to that of other companies.

 

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
March 31,

     

Year Ended
March 31,

2017     2016       2017       2016
Income (loss) from operations $ (3,164 ) $ 11,809 $ 25,973       $ 40,570
Add back:
Acquisition inventory step-up expense 8,852 — 8,852 1,446
Acquisition deal, integration, and severance costs 5,675 — 8,815 8,046
CEO retirement pay and search costs 3,085 — 3,085 —
Insurance recovery legal costs 1,359 — 1,359 —
Impairment of intangible asset 1,125 — 1,125 —
Canadian pension lump sum settlements — — 247 —
Product liability costs for legal settlement — 1,100 — 1,100
Building held for sale impairment charge — 429 — 429
Facility consolidation costs — 859 — 1,444
Magnetek acquisition amortization of backlog —         —         —         581  
Non-GAAP adjusted income from operations $ 16,932         $ 14,197         $ 49,456         $ 53,616  
 
Sales $ 183,688 $ 155,088 $ 637,123 $ 597,103
Adjusted operating margin 9.2 % 9.2 % 7.8 % 9.0 %

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, as well as facilitates a more meaningful comparison of the Company’s income from operations to that of other companies.

 

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 March 31,       Year Ended March 31,
2017       2016   2017       2016
Net income (loss) $ (4,738 ) $ 5,889 $ 8,984   $ 19,579
Add back:
Acquisition inventory step-up expense 8,852 — 8,852 1,446
Acquisition deal, integration, and severance costs 5,675 — 8,815 8,046
CEO retirement pay and search costs 3,085 — 3,085 —
Insurance recovery legal costs 1,359 — 1,359 —
Impairment of intangible asset 1,125 — 1,125 —
Loss on extinguishment of debt 1,303 — 1,303 —
(Gain) loss on foreign exchange option for acquisition (236 ) — 1,590 —
Canadian pension lump sum settlements — — 247 —
Product liability costs for legal settlement — 1,100 — 1,100
Building held for sale impairment charge — 429 — 429
Facility consolidation costs — 859 — 1,444
Magnetek acquisition amortization of backlog — — — 581
Normalize tax rate to 30% (1) (7,509 )       (406 )       (7,778 )       (1,356 )
Non-GAAP adjusted net income $ 8,916         $ 7,871         $ 27,582         $ 31,269  
 
Average diluted shares outstanding 22,201 20,254 20,888 20,315
                         
Diluted income (loss) per share - GAAP $ (0.22 )       $ 0.29         $ 0.43         $ 0.96  
                         
Diluted income per share - Non-GAAP $ 0.40         $ 0.39         $ 1.32         $ 1.54  

(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, as well as facilitates a more meaningful comparison of the Company’s net income and diluted EPS to that of other companies.