Columbus McKinnon(US:CMCO)2022-07-27 16:00Financial Performance - Net sales for the quarter ended June 30, 2022, were $220.29 million, an increase of 3.2% from $213.46 million in the same quarter of 2021, driven by $9.61 million from price increases and $8.53 million from acquired revenue from the Garvey acquisition [168]. - Gross profit for the quarter was $82.52 million, an increase of 11.4% from $74.06 million in the prior year, with a gross profit margin of 37.5% compared to 34.7% in the previous year [169]. - Selling expenses increased to $26.16 million, or 11.9% of net sales, due to the Garvey acquisition and higher business realignment costs [170]. - General and administrative expenses decreased to $21.88 million, or 9.9% of net sales, due to lower acquisition and integration costs [171]. - Research and development expenses increased to $5.13 million, representing 2.3% of net sales, up from $3.58 million or 1.7% of net sales in the prior year, reflecting additional spending for new product development [172]. Cash Flow and Debt - Cash, cash equivalents, and restricted cash totaled $85.91 million as of June 30, 2022, a decrease of $29.73 million from the previous quarter [180]. - Net cash used by operating activities was $11.18 million for the quarter, compared to $7.40 million in the same quarter of 2021, primarily due to increased inventories and decreased trade payables [181]. - The outstanding principal balance of the Term Loan B facility was $492,560,000 as of June 30, 2022, with plans to pay down approximately $40,000,000 in principal payments over the next 12 months [189]. - The Company made $10,000,000 in principal payments on the Term Loan B facility during the three months ended June 30, 2022 [189]. - The gross balance of deferred financing costs on the Term Loan B facility was $6,323,000 as of June 30, 2022 [191]. - The Company recorded a finance lease obligation of $13,957,000 for a manufacturing facility in Hartland, WI, as of June 30, 2022 [193]. - Unsecured credit lines totaled approximately $2,306,000 as of June 30, 2022, with $0 drawn [194]. - The Company expects to have sufficient cash and borrowing capacity to fund ongoing operations, debt obligations, and capital expenditures for the next twelve months [204]. Acquisitions and Investments - The company completed the acquisition of Dorner on April 7, 2021, and Garvey on December 1, 2021, enhancing its capabilities in intelligent motion solutions and automation [161][162]. - Consolidated capital expenditures for the three months ended June 30, 2022, were $2,953,000, compared to $3,648,000 for the same period in 2021, with expected capital expenditures for fiscal 2023 ranging from $25,000,000 to $30,000,000 [195]. Taxation - The effective tax rate for the quarter was 51%, significantly higher than 26% in the prior year, impacted by tax assessments related to prior acquisitions [177][178]. - The company expects an effective tax rate of approximately 29% to 30% for fiscal 2023 [179]. Market Conditions - The Company is currently experiencing higher raw material, freight, and logistics costs, which have been managed through pricing actions [197]. - There have been no material changes in market risks as previously disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2022 [208].