RBC Bearings Posts Strong 4Q, Fiscal Year

OXFORD, Conn. -- RBC Bearings Incorporated, a leading international manufacturer of highly-engineered precision plain, roller and ball bearings for the industrial, defense and aerospace industries, today reported results for the fourth quarter ended April 2, 2011. "We are very pleased with the results of our fourth quarter.

OXFORD, Conn. -- RBC Bearings Incorporated, a leading international manufacturer of highly-engineered precision plain, roller and ball bearings for the industrial, defense and aerospace industries, today reported results for the fourth quarter ended April 2, 2011.

"We are very pleased with the results of our fourth quarter. Both sales and operation efficiencies showed significant gains over last year and are the result of continued improvement in demand for products from our core markets, new product introductions and the maturing of many operating efficiency initiatives," said Dr. Michael J. Hartnett, Chairman and Chief Executive Officer. "We expect further strengthening of our core markets thru our fiscal year and are pleased to be planning an expansion of production rates in many of our plants."

Net sales for the fourth quarter of fiscal 2011 were $88.9 million, an increase of 11.4% from $79.8 million in the fourth quarter of fiscal 2010. The increase of 11.4% was driven by an increase of 18.5% in our industrial business and 4.6% in net sales in our aerospace and defense business. Gross margin for the fourth quarter was $30.3 million compared to $25.1 million for the same period last year. Gross margin as a percentage of net sales was 34.1% in the fourth quarter of fiscal 2011 compared to 31.5% for the same period last year. The increase in gross margin percentage was mainly driven by the current recovery in our industrial and aerospace businesses offset by costs associated with our expansion into large bearing products. Gross margin as a percentage of net sales, excluding $0.7 million of large bearing expansion costs, was 34.9% compared to 32.3% for the same adjusted period last year.

Operating income increased 39.4% to $16.1 million for the fourth quarter of fiscal 2011 compared to $11.5 million for the same period last year. As a percentage of net sales, operating income was 18.1% compared to 14.4% for the same period last year. Operating income excluding costs associated with the expansion into large bearing products and restructuring and moving costs was $16.8 million, an increase of 30.8% compared to adjusted operating income for the same period last year. As a percentage of net sales, operating income, excluding these charges, was 18.9% compared to 16.1% for the same adjusted period last year.

Interest expense, net for the fourth quarter of fiscal 2011 was $0.6 million compared to $0.5 million for the same period last year.

Other non-operating expense was $0.3 million for the fourth quarter of fiscal 2011. This was mainly comprised of foreign exchange losses.

For the fourth quarter of fiscal 2011, the Company reported net income of $9.9 million compared to net income of $9.7 million in the same period last year. Excluding the after-tax costs associated with the expansion into large bearing products, restructuring and moving costs, and the foreign exchange loss, net income increased 29.3% to $10.4 million compared to $8.1 million for the same adjusted period last year.

Fiscal Year 2011 Results

Net sales for fiscal 2011 were $335.6 million, an increase of 22.2% from $274.7 million for the same period last year. Gross margin for fiscal 2011 was $109.8 million compared to $84.6 million for the same period last year. Gross margin as a percentage of net sales was 32.7% for fiscal 2011 compared to 30.8% for the same period last year. The increase in gross margin percentage was mainly driven by the current recovery in our industrial and aerospace businesses offset by costs associated with the expansion into large bearing products. Gross margin as a percentage of net sales, excluding $2.9 million of large bearing expansion costs, was 33.6% compared to 31.7% for the same adjusted period last year.

For fiscal 2011, the Company reported operating income of $56.2 million compared to $34.7 million for the same period last year. Operating income excluding costs associated with the expansion into large bearing products and restructuring and moving costs offset by a net gain on sale of assets was $58.2 million for fiscal 2011 compared to $38.7 million for the same adjusted period last year. Operating income as a percentage of net sales excluding these charges was 17.3% for fiscal 2011 compared to 14.1% for the same adjusted period last year.

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