NEWS BULLETIN
JPS Industries, Inc.
55 Beattie Place
Suite 1510
Greenville, SC 29601
For Further Information:
Mikel H. Williams
President and Chief Executive Officer
(864) 239-3900
JPS Industries, Inc. Announces Second Quarter 2014 Results
GREENVILLE, S.C., May 21, 2014 – JPS Industries, Inc. (JPST.PK), a leading
manufacturer of composite materials today announced financial and operating results
for our second fiscal quarter ended May 3, 2014.
Second Quarter FY 2014 Highlights:
 Net Sales of $43.9 million, a 11% increase over year ago second quarter 2013
due to stronger performance in the aerospace, ballistic and electronics market
segments
 Gross profit of $7.6 million, a 9% increase over year ago second quarter, yet with
lower gross margin of 17.3% compared to 17.7% due to a greater mix of lower
margin product sales
 Reduced recurring SG&A of $3.4 million, down 10% from year ago second quarter
due to increased efforts to reduce and control costs
 Adjusted EBITDA of $4.7 million, a 39% increase over year ago second quarter
 GAAP net income of $9.8 million, inclusive of a $7.5 million gain on sale and $437
thousand income during the quarter from the Urethane operating division sold on
April 30, 2014, both net of tax
 Diluted earnings per share of $0.95 vs. $0.16 in the year ago quarter, inclusive of
$0.72 from the one-time gain on the sale, or $0.23 excluding the gain
 Urethane operating division was sold on April 30
 Repaid in full and terminated our outstanding term note facility of $5.9 million
 Repaid in full the outstanding balance on our line of credit facility, which remains
in place with $25.7 million available based upon our quarter end collateral base
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Mikel H. Williams, JPS’s CEO stated: “I am pleased to report another solid quarter of
improved business performance as well as the sale of our Urethane division. This
sale allows us to focus on our core composite materials business with a stronger
financial profile.” Williams continued, “The comprehensive process of considering the
sale of our Urethane division occurred over the past couple of years, and culminated
in the sale to Argotec, LLC, a privately held strategic purchaser. With this transaction
now behind us, our focus is to strengthen and grow our composite materials
business. While this business can be cyclical, and one should not annualize any one
period, our long term goal will continue to be on driving top line growth and
operational excellence, supporting both with prudent investment as necessary, to
improve cash flows and value for our shareholders.”
The Statement of Operations for both the current year and the prior year periods
have been prepared reflecting the Stevens Urethane division as a discontinued
operation, as the sale was closed on April 30, 2014. The prior year balance sheet
has not been restated for comparison purposes since the division was not an asset
held for sale at that time. Certain reclassifications as well as re-allocations among
quarterly periods have been made to the prior year’s second quarter’s financial
statements to conform to the current year’s presentation. These changes will have no
effect on the previously reported results of operations for the full fiscal year 2013.
About JPS Industries, Inc.
JPS Industries, Inc. is a major U.S. manufacturer of sheet and mechanically formed
glass and aramid materials for specialty applications in a wide expanse of markets
requiring highly engineered components. JPS's products are used in a wide range of
applications including: advanced composite materials; civilian and military aerospace
components; printed electronic circuit boards; filtration and insulation products;
specialty commercial construction substrates; automotive and industrial components;
soft body armor for civilian and military applications. Headquartered in Greenville,
South Carolina, the Company operates three manufacturing locations in Anderson
and Slater, South Carolina and Statesville, North Carolina.
###
Non-GAAP Financial Measures
This release includes 'adjusted EBITDA', a non-GAAP financial measure as defined
in Regulation G of the Securities Exchange Act of 1934. Management believes that
the disclosure of non-GAAP financial measures, when presented in conjunction with
the corresponding GAAP measures, provide useful information to the Company,
investors and other users of the financial statements and other financial information in
identifying and understanding operating performance for a given level of net sales
and business trends. Management believes that adjusted EBITDA is an important
2
factor of the Company's business because it reflects financial performance that is
unencumbered by debt service and other non-cash, non-recurring or unusual items.
This financial measure is commonly used in the Company's industry. However,
adjusted EBITDA should not be considered as an alternative to cash flow from
operating activities, as a measure of liquidity or as an alternative to net income as a
measure of operating results in accordance with generally accepted accounting
principles. The Company's definition of adjusted EBITDA may differ from definitions
of such financial measure used by other companies. The Company has provided a
reconciliation of adjusted EBITDA to GAAP financial information in the attached
Schedule of Non-GAAP reconciliations.
"SafeHarbor" Statement under the Private Securities Litigation Reform Act of 1995
Except for historical information contained in this release, statements in this release may constitute
forward-looking statements regarding the Company's assumptions, projections, expectations, targets,
intentions or beliefs about future events. Words or phrases such as "anticipates," "believes,"
"estimates," "expects," "intends," "plans," "predicts," "projects," "targets," "will likely result," "will
continue," "may," "could" or similar expressions identify forward-looking statements. Forward-looking
statements involve risks and uncertainties, which could cause actual results or outcomes to differ
materially from those expressed. The Company cautions that while it makes such statements in good
faith and it believes such statements are based on reasonable assumptions, including without limitation,
management's examination of historical operating trends, data contained in records, and other data
available from third parties, it cannot assure you that the Company's projections will be achieved. In
addition to other factors and matters discussed from time to time in the Company's filings with the U.S.
Securities and Exchange Commission, or the SEC, some important factors that could cause actual
results or outcomes for JPS or its subsidiaries to differ materially from those discussed in forwardlooking statements include changes in general economic conditions in the markets in which it may
compete and fluctuations in demand in the electronics industry; the Company's ability to sustain
historical margins; increased competition; increased costs; loss or retirement of key members of
management; currency exchange rate fluctuations; integration of acquired operations; international
operations; compliance with environmental regulations; potential impacts of natural disasters on the
electronics industry and the Company’s supply chain; increases in the Company's cost of borrowings or
unavailability of additional debt or equity capital on terms considered reasonable by management; and
adverse state, federal or foreign legislation or regulation or adverse determinations by regulators. Any
forward-looking statement speaks only as of the date on which such statement is made, and, except as
required by law, the Company undertakes no obligation to update any forward-looking statement to
reflect events or circumstances after the date on which such statement is made or to reflect the
occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for
management to predict all such factors.
3
JPS INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share data)
(Unaudited)
Three Months Ended
May 3,
April 27,
2014
2013
Net sales
Cost of sales
$
Gross profit
Selling, general & administrative and other expenses
Distribution expense
Operating profit
43,856
36,249
39,388
32,426
$
7,607 17.3%
6,962 17.7%
3,390
945
3,749
1,060
3,272
Interest expense, net
$
May 3,
2014
2,153
7.5%
Six Months Ended
April 27,
2013
78,889
65,711
$
13,178 16.7%
11,903 18.6%
6,871
1,891
4,416
5.5%
63,864
51,961
7,530
1,763
2,610
5.6%
206
308
442
620
Income before income taxes
3,066
1,845
3,974
1,990
Income taxes
Income from continuing operations
1,137
1,929
677
1,168
1,462
2,512
724
1,266
Discontinued operations:
Gain on sale of discontinued operations, net of taxes
Income from discontinued operations, net of taxes
7,471
437
528
7,471
999
788
Net income
$
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING:
Basic
Diluted
9,837 22.4% $
1,696
4.3%
$
10,982 13.9% $
2,054
10,281,460
10,278,460
10,281,460
10,251,349
10,348,981
10,348,297
10,348,981
10,345,570
Basic earnings per common share
$
0.96
$
0.17
$
1.07
$
0.20
Diluted earnings per common share
$
0.95
$
0.16
$
1.06
$
0.20
1,696
308
677
280
6
(528)
920
3,359
$
Adjusted EBITDA:
Net income
Plus interest expense
Plus income taxes
Plus depreciation and amortization
Plus stock comp expense
Gain on sale of discontinued operations, net of taxes
Income from discontinued operations, net of taxes
Plus pension and post retirement expense
Adjusted EBITDA
Capital expenditures
Cash taxes paid
Cash pension contributions
$
$
$
$
$
9,837
$
206
1,137
395
17
(7,471)
(437)
988
4,672 10.7% $
501
136
1,525
4
$
$
$
642
40
821
8.5%
$
$
$
$
10,982
$
442
1,462
789
35
(7,471)
(999)
1,908
7,148 9.1% $
574
238
2,346
$
$
$
2,054
620
724
560
87
(788)
1,840
5,097
1,208
59
1,507
4.1%
3.2%
8.0%
JPS INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
(Unaudited)
May 3,
2014
ASSETS
Current Assets:
Cash
Restricted cash
Cash held in escrow
Accounts receivable, net of reserves
Inventories
Prepaid expenses and other
Total current assets
$
Property, plant and equipment, net
Deferred income taxes
Goodwill
Other assets
Total assets
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable
Accrued pension costs
Accrued expenses, salaries, benefits and withholding
Current portion of long-term debt
Total current liabilities
1,656
3,685
1,500
24,835
24,044
7,496
61,898
31,295
24,341
7,525
68,502
13,166
48,149
10,100
386
16,935
54,954
10,100
536
133,699
$
151,027
$
8,930
9,239
3,789
21,958
$
10,013
8,611
7,487
4,980
31,091
Total liabilities
Total shareholders' equity
$
5
$
$
Long-term debt
Accrued pension costs
Other long-term liabilities
Total liabilities and shareholders' equity
4,023
November 2,
2013
0
26,583
534
18,147
27,648
534
49,075
77,420
84,624
73,607
133,699
$
151,027