Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil Hydroworld Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries SIFCO Industries, Inc. (“SIFCO”) Announces First Quarter Fiscal 2024 Financial Results By: SIFCO Industries, Inc. via Business Wire February 14, 2024 at 16:30 PM EST SIFCO Industries, Inc. (NYSE American: SIF) today announced financial results for its first quarter of fiscal 2024, which ended December 31, 2023. First Quarter Results Net sales in the first quarter of fiscal 2024 decreased 1.2% to $21.1 million, compared with $21.3 million for the same period in fiscal 2023. Net loss for the first quarter of fiscal 2024 was $3.4 million, or $(0.57) per diluted share, compared with net loss of $2.6 million, or $(0.44) per diluted share, in the first quarter of fiscal 2023. EBITDA was $(1.4) million in the first quarter of fiscal 2024, compared with $(0.7) million in the first quarter of fiscal 2023. Adjusted EBITDA in the first quarter of fiscal 2024 was $(0.8) million, compared with Adjusted EBITDA of $(0.1) million in the first quarter of fiscal 2023. Other Highlights CEO Peter W. Knapper stated, “Our first quarter was dominated by new product development activities. Our backlog continues to increase, now at $130.1 million. Inventory increased $3.6 million compared to prior year quarter as we increase production to meet our customer demands.” Use of Non-GAAP Financial Measures The Company uses certain non-GAAP measures in this release. EBITDA and Adjusted EBITDA are non-GAAP financial measures and are intended to serve as supplements to results provided in accordance with accounting principles generally accepted in the United States. SIFCO Industries, Inc. believes that such information provides an additional measurement and consistent historical comparison of the Company’s performance. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is available in this news release. Forward-Looking Language Certain statements contained in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to financial results and plans for future business development activities, and are thus prospective. Such forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions, concerns with or threats of, or the consequences of, pandemics, contagious diseases or health epidemics, including COVID-19, competition and other uncertainties the Company, its customers, and the industry in which they operate have experienced and continue to experience, detailed from time to time in the Company’s Securities and Exchange Commission filings. The Company's Annual Report on Form 10-K for the year ended September 30, 2023 and other reports filed with the Securities and Exchange Commission can be accessed through the Company's website: www.sifco.com, or on the Securities and Exchange Commission's website: www.sec.gov. SIFCO Industries, Inc. is engaged in the production of forgings and machined components primarily for the aerospace and energy markets. The processes and services include forging, heat-treating, coating, and machining. First Quarter ended December 31, (Amounts in thousands, except per share data) (Unaudited) Three Months Ended December 31, 2023 2022 Net sales $ 21,052 $ 21,299 Cost of goods sold 20,316 20,038 Gross profit 736 1,261 Selling, general and administrative expenses 3,581 3,280 Amortization of intangible assets 40 61 Gain on disposal of operating assets — (11 ) Operating loss (2,885 ) (2,069 ) Interest expense, net 430 275 Foreign currency exchange loss (gain), net 4 (3 ) Other expense, net 53 182 Loss before income tax expense (3,372 ) (2,523 ) Income tax expense 50 66 Net loss $ (3,422 ) $ (2,589 ) Net loss per share Basic $ (0.57 ) $ (0.44 ) Diluted $ (0.57 ) $ (0.44 ) Weighted-average number of common shares (basic) 5,956 5,896 Weighted-average number of common shares (diluted) 5,956 5,896 Consolidated Condensed Balance Sheets (Amounts in thousands, except per share data) (Unaudited) December 31, 2023 September 30, 2023 (unaudited) ASSETS Current assets: Cash and cash equivalents $ 3,236 $ 368 Receivables, net of allowance for doubtful accounts of $121 and $242, respectively 18,184 20,196 Contract assets 10,949 10,091 Inventories, net 12,430 8,853 Refundable income taxes 84 84 Prepaid expenses and other current assets 2,692 1,882 Total current assets 47,575 41,474 Property, plant and equipment, net 35,884 36,287 Operating lease right-of-use assets, net 14,152 14,380 Intangible assets, net 248 278 Goodwill 3,493 3,493 Other assets 131 81 Total assets $ 101,483 $ 95,993 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Current maturities of long-term debt $ 4,085 $ 3,820 Promissory note - related party 3,150 — Revolver 16,061 16,289 Short-term operating lease liabilities 884 869 Accounts payable 14,832 13,497 Accrued liabilities 8,852 6,477 Total current liabilities 47,864 40,952 Long-term debt, net of current maturities, net of unamortized debt issuance costs 4,393 2,457 Long-term operating lease liabilities, net of short-term 13,799 14,020 Deferred income taxes, net 105 142 Pension liability 3,411 3,417 Other long-term liabilities 664 670 Shareholders’ equity: Serial preferred shares, no par value, authorized 1,000 shares; 0 shares issued and outstanding at December 31, 2023 and September 30, 2023 — — Common shares, par value $1 per share, authorized 10,000 shares; issued and outstanding shares 6,160 at December 31, 2023 and 6,105 at September 30, 2023 6,160 6,105 Additional paid-in capital 11,609 11,626 Retained earnings 19,842 23,264 Accumulated other comprehensive loss (6,364 ) (6,660 ) Total shareholders’ equity 31,247 34,335 Total liabilities and shareholders’ equity $ 101,483 $ 95,993 Non-GAAP Financial Measures Presented below is certain financial information based on the Company's EBITDA and Adjusted EBITDA. References to “EBITDA” mean earnings (losses) from continuing operations before interest, taxes, depreciation and amortization, and references to “Adjusted EBITDA” mean EBITDA plus, as applicable for each relevant period, certain adjustments as set forth in the reconciliations of net income to EBITDA and Adjusted EBITDA. Neither EBITDA nor Adjusted EBITDA is a measurement of financial performance under generally accepted accounting principles in the United States of America (“GAAP”). The Company presents EBITDA and Adjusted EBITDA because management believes that they are useful indicators for evaluating operating performance and liquidity, including the Company’s ability to incur and service debt and it uses EBITDA to evaluate prospective acquisitions. Although the Company uses EBITDA and Adjusted EBITDA for the reasons noted above, the use of these non-GAAP financial measures as analytical tools has limitations. Therefore, reviewers of the Company’s financial information should not consider them in isolation, or as a substitute for analysis of the Company's results of operations as reported in accordance with GAAP. Some of these limitations include: Neither EBITDA nor Adjusted EBITDA reflects the interest expense, or the cash requirements necessary to service interest payments on indebtedness; Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and neither EBITDA nor Adjusted EBITDA reflects any cash requirements for such replacements; The omission of the amortization expense associated with the Company’s intangible assets further limits the usefulness of EBITDA and Adjusted EBITDA; and Neither EBITDA nor Adjusted EBITDA includes the payment of taxes, which is a necessary element of operations. Because of these limitations, EBITDA and Adjusted EBITDA should not be considered as measures of discretionary cash available to the Company to invest in the growth of its businesses. Management compensates for these limitations by not viewing EBITDA or Adjusted EBITDA in isolation and specifically by using other GAAP measures, such as net income (loss), net sales, and operating income (loss), to measure operating performance. Neither EBITDA nor Adjusted EBITDA is a measurement of financial performance under GAAP, and neither should be considered as an alternative to net loss or cash flow from operations determined in accordance with GAAP. The Company’s calculation of EBITDA and Adjusted EBITDA may not be comparable to the calculation of similarly titled measures reported by other companies. The following table sets forth a reconciliation of net loss to EBITDA and Adjusted EBITDA: Dollars in thousands Three Months Ended December 31, 2023 2022 Net loss $ (3,422 ) $ (2,589 ) Adjustments: Depreciation and amortization expense 1,562 1,571 Interest expense, net 430 275 Income tax expense 50 66 EBITDA (1,380 ) (677 ) Adjustments: Foreign currency exchange loss (gain), net (1) 4 (3 ) Other expense, net (2) 54 72 Gain on disposal of assets (3) — (11 ) Equity compensation (4) 86 122 LIFO impact (5) 293 262 IT incident costs, net (6) (1 ) 110 Strategic alternative expense (7) 187 — Adjusted EBITDA $ (757 ) $ (125 ) (1) Represents the gain or loss from changes in the exchange rates between the functional currency and the foreign currency in which the transaction is denominated. (2) Represents miscellaneous non-operating income or expense, such as pension costs or grant income (prior year included $0.1 million in loss on insurance recovery, separately reclassed to IT incident costs, net line). (3) Represents the difference between the proceeds from the sale of operating equipment and the carrying value shown on the Company's books. (4) Represents the equity-based compensation expense recognized by the Company under the 2016 Plan due to granting of awards, awards not vesting and/or forfeitures. (5) Represents the change in the reserve for inventories for which cost is determined using the last-in, first-out ("LIFO") method. (6) Represents incremental information technology costs as it relates to the cybersecurity incident and loss on insurance recovery (prior year balance includes reclassed amount of $0.1 million from footnote two above). (7) Represents expense related to evaluation of strategic alternatives. Reference to the above activities can be found in the consolidated financial statements included in Item 8 of the Company's Annual Report on Form 10-K. View source version on businesswire.com: https://www.businesswire.com/news/home/20240214191250/en/Contacts SIFCO Industries, Inc. Thomas R. Kubera, 216-881-8600 www.sifco.com Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. By accessing this page, you agree to the following Privacy Policy and Terms and Conditions.
SIFCO Industries, Inc. (“SIFCO”) Announces First Quarter Fiscal 2024 Financial Results By: SIFCO Industries, Inc. via Business Wire February 14, 2024 at 16:30 PM EST SIFCO Industries, Inc. (NYSE American: SIF) today announced financial results for its first quarter of fiscal 2024, which ended December 31, 2023. First Quarter Results Net sales in the first quarter of fiscal 2024 decreased 1.2% to $21.1 million, compared with $21.3 million for the same period in fiscal 2023. Net loss for the first quarter of fiscal 2024 was $3.4 million, or $(0.57) per diluted share, compared with net loss of $2.6 million, or $(0.44) per diluted share, in the first quarter of fiscal 2023. EBITDA was $(1.4) million in the first quarter of fiscal 2024, compared with $(0.7) million in the first quarter of fiscal 2023. Adjusted EBITDA in the first quarter of fiscal 2024 was $(0.8) million, compared with Adjusted EBITDA of $(0.1) million in the first quarter of fiscal 2023. Other Highlights CEO Peter W. Knapper stated, “Our first quarter was dominated by new product development activities. Our backlog continues to increase, now at $130.1 million. Inventory increased $3.6 million compared to prior year quarter as we increase production to meet our customer demands.” Use of Non-GAAP Financial Measures The Company uses certain non-GAAP measures in this release. EBITDA and Adjusted EBITDA are non-GAAP financial measures and are intended to serve as supplements to results provided in accordance with accounting principles generally accepted in the United States. SIFCO Industries, Inc. believes that such information provides an additional measurement and consistent historical comparison of the Company’s performance. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is available in this news release. Forward-Looking Language Certain statements contained in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to financial results and plans for future business development activities, and are thus prospective. Such forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions, concerns with or threats of, or the consequences of, pandemics, contagious diseases or health epidemics, including COVID-19, competition and other uncertainties the Company, its customers, and the industry in which they operate have experienced and continue to experience, detailed from time to time in the Company’s Securities and Exchange Commission filings. The Company's Annual Report on Form 10-K for the year ended September 30, 2023 and other reports filed with the Securities and Exchange Commission can be accessed through the Company's website: www.sifco.com, or on the Securities and Exchange Commission's website: www.sec.gov. SIFCO Industries, Inc. is engaged in the production of forgings and machined components primarily for the aerospace and energy markets. The processes and services include forging, heat-treating, coating, and machining. First Quarter ended December 31, (Amounts in thousands, except per share data) (Unaudited) Three Months Ended December 31, 2023 2022 Net sales $ 21,052 $ 21,299 Cost of goods sold 20,316 20,038 Gross profit 736 1,261 Selling, general and administrative expenses 3,581 3,280 Amortization of intangible assets 40 61 Gain on disposal of operating assets — (11 ) Operating loss (2,885 ) (2,069 ) Interest expense, net 430 275 Foreign currency exchange loss (gain), net 4 (3 ) Other expense, net 53 182 Loss before income tax expense (3,372 ) (2,523 ) Income tax expense 50 66 Net loss $ (3,422 ) $ (2,589 ) Net loss per share Basic $ (0.57 ) $ (0.44 ) Diluted $ (0.57 ) $ (0.44 ) Weighted-average number of common shares (basic) 5,956 5,896 Weighted-average number of common shares (diluted) 5,956 5,896 Consolidated Condensed Balance Sheets (Amounts in thousands, except per share data) (Unaudited) December 31, 2023 September 30, 2023 (unaudited) ASSETS Current assets: Cash and cash equivalents $ 3,236 $ 368 Receivables, net of allowance for doubtful accounts of $121 and $242, respectively 18,184 20,196 Contract assets 10,949 10,091 Inventories, net 12,430 8,853 Refundable income taxes 84 84 Prepaid expenses and other current assets 2,692 1,882 Total current assets 47,575 41,474 Property, plant and equipment, net 35,884 36,287 Operating lease right-of-use assets, net 14,152 14,380 Intangible assets, net 248 278 Goodwill 3,493 3,493 Other assets 131 81 Total assets $ 101,483 $ 95,993 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Current maturities of long-term debt $ 4,085 $ 3,820 Promissory note - related party 3,150 — Revolver 16,061 16,289 Short-term operating lease liabilities 884 869 Accounts payable 14,832 13,497 Accrued liabilities 8,852 6,477 Total current liabilities 47,864 40,952 Long-term debt, net of current maturities, net of unamortized debt issuance costs 4,393 2,457 Long-term operating lease liabilities, net of short-term 13,799 14,020 Deferred income taxes, net 105 142 Pension liability 3,411 3,417 Other long-term liabilities 664 670 Shareholders’ equity: Serial preferred shares, no par value, authorized 1,000 shares; 0 shares issued and outstanding at December 31, 2023 and September 30, 2023 — — Common shares, par value $1 per share, authorized 10,000 shares; issued and outstanding shares 6,160 at December 31, 2023 and 6,105 at September 30, 2023 6,160 6,105 Additional paid-in capital 11,609 11,626 Retained earnings 19,842 23,264 Accumulated other comprehensive loss (6,364 ) (6,660 ) Total shareholders’ equity 31,247 34,335 Total liabilities and shareholders’ equity $ 101,483 $ 95,993 Non-GAAP Financial Measures Presented below is certain financial information based on the Company's EBITDA and Adjusted EBITDA. References to “EBITDA” mean earnings (losses) from continuing operations before interest, taxes, depreciation and amortization, and references to “Adjusted EBITDA” mean EBITDA plus, as applicable for each relevant period, certain adjustments as set forth in the reconciliations of net income to EBITDA and Adjusted EBITDA. Neither EBITDA nor Adjusted EBITDA is a measurement of financial performance under generally accepted accounting principles in the United States of America (“GAAP”). The Company presents EBITDA and Adjusted EBITDA because management believes that they are useful indicators for evaluating operating performance and liquidity, including the Company’s ability to incur and service debt and it uses EBITDA to evaluate prospective acquisitions. Although the Company uses EBITDA and Adjusted EBITDA for the reasons noted above, the use of these non-GAAP financial measures as analytical tools has limitations. Therefore, reviewers of the Company’s financial information should not consider them in isolation, or as a substitute for analysis of the Company's results of operations as reported in accordance with GAAP. Some of these limitations include: Neither EBITDA nor Adjusted EBITDA reflects the interest expense, or the cash requirements necessary to service interest payments on indebtedness; Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and neither EBITDA nor Adjusted EBITDA reflects any cash requirements for such replacements; The omission of the amortization expense associated with the Company’s intangible assets further limits the usefulness of EBITDA and Adjusted EBITDA; and Neither EBITDA nor Adjusted EBITDA includes the payment of taxes, which is a necessary element of operations. Because of these limitations, EBITDA and Adjusted EBITDA should not be considered as measures of discretionary cash available to the Company to invest in the growth of its businesses. Management compensates for these limitations by not viewing EBITDA or Adjusted EBITDA in isolation and specifically by using other GAAP measures, such as net income (loss), net sales, and operating income (loss), to measure operating performance. Neither EBITDA nor Adjusted EBITDA is a measurement of financial performance under GAAP, and neither should be considered as an alternative to net loss or cash flow from operations determined in accordance with GAAP. The Company’s calculation of EBITDA and Adjusted EBITDA may not be comparable to the calculation of similarly titled measures reported by other companies. The following table sets forth a reconciliation of net loss to EBITDA and Adjusted EBITDA: Dollars in thousands Three Months Ended December 31, 2023 2022 Net loss $ (3,422 ) $ (2,589 ) Adjustments: Depreciation and amortization expense 1,562 1,571 Interest expense, net 430 275 Income tax expense 50 66 EBITDA (1,380 ) (677 ) Adjustments: Foreign currency exchange loss (gain), net (1) 4 (3 ) Other expense, net (2) 54 72 Gain on disposal of assets (3) — (11 ) Equity compensation (4) 86 122 LIFO impact (5) 293 262 IT incident costs, net (6) (1 ) 110 Strategic alternative expense (7) 187 — Adjusted EBITDA $ (757 ) $ (125 ) (1) Represents the gain or loss from changes in the exchange rates between the functional currency and the foreign currency in which the transaction is denominated. (2) Represents miscellaneous non-operating income or expense, such as pension costs or grant income (prior year included $0.1 million in loss on insurance recovery, separately reclassed to IT incident costs, net line). (3) Represents the difference between the proceeds from the sale of operating equipment and the carrying value shown on the Company's books. (4) Represents the equity-based compensation expense recognized by the Company under the 2016 Plan due to granting of awards, awards not vesting and/or forfeitures. (5) Represents the change in the reserve for inventories for which cost is determined using the last-in, first-out ("LIFO") method. (6) Represents incremental information technology costs as it relates to the cybersecurity incident and loss on insurance recovery (prior year balance includes reclassed amount of $0.1 million from footnote two above). (7) Represents expense related to evaluation of strategic alternatives. Reference to the above activities can be found in the consolidated financial statements included in Item 8 of the Company's Annual Report on Form 10-K. View source version on businesswire.com: https://www.businesswire.com/news/home/20240214191250/en/Contacts SIFCO Industries, Inc. Thomas R. Kubera, 216-881-8600 www.sifco.com
SIFCO Industries, Inc. (NYSE American: SIF) today announced financial results for its first quarter of fiscal 2024, which ended December 31, 2023. First Quarter Results Net sales in the first quarter of fiscal 2024 decreased 1.2% to $21.1 million, compared with $21.3 million for the same period in fiscal 2023. Net loss for the first quarter of fiscal 2024 was $3.4 million, or $(0.57) per diluted share, compared with net loss of $2.6 million, or $(0.44) per diluted share, in the first quarter of fiscal 2023. EBITDA was $(1.4) million in the first quarter of fiscal 2024, compared with $(0.7) million in the first quarter of fiscal 2023. Adjusted EBITDA in the first quarter of fiscal 2024 was $(0.8) million, compared with Adjusted EBITDA of $(0.1) million in the first quarter of fiscal 2023. Other Highlights CEO Peter W. Knapper stated, “Our first quarter was dominated by new product development activities. Our backlog continues to increase, now at $130.1 million. Inventory increased $3.6 million compared to prior year quarter as we increase production to meet our customer demands.” Use of Non-GAAP Financial Measures The Company uses certain non-GAAP measures in this release. EBITDA and Adjusted EBITDA are non-GAAP financial measures and are intended to serve as supplements to results provided in accordance with accounting principles generally accepted in the United States. SIFCO Industries, Inc. believes that such information provides an additional measurement and consistent historical comparison of the Company’s performance. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is available in this news release. Forward-Looking Language Certain statements contained in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to financial results and plans for future business development activities, and are thus prospective. Such forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions, concerns with or threats of, or the consequences of, pandemics, contagious diseases or health epidemics, including COVID-19, competition and other uncertainties the Company, its customers, and the industry in which they operate have experienced and continue to experience, detailed from time to time in the Company’s Securities and Exchange Commission filings. The Company's Annual Report on Form 10-K for the year ended September 30, 2023 and other reports filed with the Securities and Exchange Commission can be accessed through the Company's website: www.sifco.com, or on the Securities and Exchange Commission's website: www.sec.gov. SIFCO Industries, Inc. is engaged in the production of forgings and machined components primarily for the aerospace and energy markets. The processes and services include forging, heat-treating, coating, and machining. First Quarter ended December 31, (Amounts in thousands, except per share data) (Unaudited) Three Months Ended December 31, 2023 2022 Net sales $ 21,052 $ 21,299 Cost of goods sold 20,316 20,038 Gross profit 736 1,261 Selling, general and administrative expenses 3,581 3,280 Amortization of intangible assets 40 61 Gain on disposal of operating assets — (11 ) Operating loss (2,885 ) (2,069 ) Interest expense, net 430 275 Foreign currency exchange loss (gain), net 4 (3 ) Other expense, net 53 182 Loss before income tax expense (3,372 ) (2,523 ) Income tax expense 50 66 Net loss $ (3,422 ) $ (2,589 ) Net loss per share Basic $ (0.57 ) $ (0.44 ) Diluted $ (0.57 ) $ (0.44 ) Weighted-average number of common shares (basic) 5,956 5,896 Weighted-average number of common shares (diluted) 5,956 5,896 Consolidated Condensed Balance Sheets (Amounts in thousands, except per share data) (Unaudited) December 31, 2023 September 30, 2023 (unaudited) ASSETS Current assets: Cash and cash equivalents $ 3,236 $ 368 Receivables, net of allowance for doubtful accounts of $121 and $242, respectively 18,184 20,196 Contract assets 10,949 10,091 Inventories, net 12,430 8,853 Refundable income taxes 84 84 Prepaid expenses and other current assets 2,692 1,882 Total current assets 47,575 41,474 Property, plant and equipment, net 35,884 36,287 Operating lease right-of-use assets, net 14,152 14,380 Intangible assets, net 248 278 Goodwill 3,493 3,493 Other assets 131 81 Total assets $ 101,483 $ 95,993 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Current maturities of long-term debt $ 4,085 $ 3,820 Promissory note - related party 3,150 — Revolver 16,061 16,289 Short-term operating lease liabilities 884 869 Accounts payable 14,832 13,497 Accrued liabilities 8,852 6,477 Total current liabilities 47,864 40,952 Long-term debt, net of current maturities, net of unamortized debt issuance costs 4,393 2,457 Long-term operating lease liabilities, net of short-term 13,799 14,020 Deferred income taxes, net 105 142 Pension liability 3,411 3,417 Other long-term liabilities 664 670 Shareholders’ equity: Serial preferred shares, no par value, authorized 1,000 shares; 0 shares issued and outstanding at December 31, 2023 and September 30, 2023 — — Common shares, par value $1 per share, authorized 10,000 shares; issued and outstanding shares 6,160 at December 31, 2023 and 6,105 at September 30, 2023 6,160 6,105 Additional paid-in capital 11,609 11,626 Retained earnings 19,842 23,264 Accumulated other comprehensive loss (6,364 ) (6,660 ) Total shareholders’ equity 31,247 34,335 Total liabilities and shareholders’ equity $ 101,483 $ 95,993 Non-GAAP Financial Measures Presented below is certain financial information based on the Company's EBITDA and Adjusted EBITDA. References to “EBITDA” mean earnings (losses) from continuing operations before interest, taxes, depreciation and amortization, and references to “Adjusted EBITDA” mean EBITDA plus, as applicable for each relevant period, certain adjustments as set forth in the reconciliations of net income to EBITDA and Adjusted EBITDA. Neither EBITDA nor Adjusted EBITDA is a measurement of financial performance under generally accepted accounting principles in the United States of America (“GAAP”). The Company presents EBITDA and Adjusted EBITDA because management believes that they are useful indicators for evaluating operating performance and liquidity, including the Company’s ability to incur and service debt and it uses EBITDA to evaluate prospective acquisitions. Although the Company uses EBITDA and Adjusted EBITDA for the reasons noted above, the use of these non-GAAP financial measures as analytical tools has limitations. Therefore, reviewers of the Company’s financial information should not consider them in isolation, or as a substitute for analysis of the Company's results of operations as reported in accordance with GAAP. Some of these limitations include: Neither EBITDA nor Adjusted EBITDA reflects the interest expense, or the cash requirements necessary to service interest payments on indebtedness; Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and neither EBITDA nor Adjusted EBITDA reflects any cash requirements for such replacements; The omission of the amortization expense associated with the Company’s intangible assets further limits the usefulness of EBITDA and Adjusted EBITDA; and Neither EBITDA nor Adjusted EBITDA includes the payment of taxes, which is a necessary element of operations. Because of these limitations, EBITDA and Adjusted EBITDA should not be considered as measures of discretionary cash available to the Company to invest in the growth of its businesses. Management compensates for these limitations by not viewing EBITDA or Adjusted EBITDA in isolation and specifically by using other GAAP measures, such as net income (loss), net sales, and operating income (loss), to measure operating performance. Neither EBITDA nor Adjusted EBITDA is a measurement of financial performance under GAAP, and neither should be considered as an alternative to net loss or cash flow from operations determined in accordance with GAAP. The Company’s calculation of EBITDA and Adjusted EBITDA may not be comparable to the calculation of similarly titled measures reported by other companies. The following table sets forth a reconciliation of net loss to EBITDA and Adjusted EBITDA: Dollars in thousands Three Months Ended December 31, 2023 2022 Net loss $ (3,422 ) $ (2,589 ) Adjustments: Depreciation and amortization expense 1,562 1,571 Interest expense, net 430 275 Income tax expense 50 66 EBITDA (1,380 ) (677 ) Adjustments: Foreign currency exchange loss (gain), net (1) 4 (3 ) Other expense, net (2) 54 72 Gain on disposal of assets (3) — (11 ) Equity compensation (4) 86 122 LIFO impact (5) 293 262 IT incident costs, net (6) (1 ) 110 Strategic alternative expense (7) 187 — Adjusted EBITDA $ (757 ) $ (125 ) (1) Represents the gain or loss from changes in the exchange rates between the functional currency and the foreign currency in which the transaction is denominated. (2) Represents miscellaneous non-operating income or expense, such as pension costs or grant income (prior year included $0.1 million in loss on insurance recovery, separately reclassed to IT incident costs, net line). (3) Represents the difference between the proceeds from the sale of operating equipment and the carrying value shown on the Company's books. (4) Represents the equity-based compensation expense recognized by the Company under the 2016 Plan due to granting of awards, awards not vesting and/or forfeitures. (5) Represents the change in the reserve for inventories for which cost is determined using the last-in, first-out ("LIFO") method. (6) Represents incremental information technology costs as it relates to the cybersecurity incident and loss on insurance recovery (prior year balance includes reclassed amount of $0.1 million from footnote two above). (7) Represents expense related to evaluation of strategic alternatives. Reference to the above activities can be found in the consolidated financial statements included in Item 8 of the Company's Annual Report on Form 10-K. View source version on businesswire.com: https://www.businesswire.com/news/home/20240214191250/en/
