Wabash National Corporation Announces First Quarter 2013 Results

Wabash National Corporation Announces First Quarter 2013 Results 
Q1 2013 GAAP EPS of $0.08 and Non-GAAP Adjusted EPS of $0.09 per
Diluted Share; Income From Operations Increases 173% Year-Over-Year 
LAFAYETTE, IN -- (Marketwired) -- 04/30/13 --  Wabash National
Corporation (NYSE: WNC) reported year-over-year improvement across a
number of financial and operating metrics for the three month period
ended March 31, 2013. The Company reported net income of $5.7
million, or $0.08 per diluted share, for the first quarter of 2013 on
net sales of $324 million. Results for the three months ended March
31, 2013 include full quarter results of Walker Group Holdings, LLC
("Walker"), a leading manufacturer of liquid-transportation systems
and engineered products, acquired by the Company on May 8, 2012. The
Company's first quarter results include the impact of one-time costs
related to the acquisition of Walker and of certain bankruptcy assets
of Beall Corporation ("Beall") acquired on February 4, 2013, totaling
$0.6 million, or $0.01 per diluted share. Excluding the impact of
these items, non-GAAP adjusted earnings for the quarter ended March
31, 2013 were $6.1 million, or $0.09 per diluted share. The Company
reported net income of $5.1 million, or $0.07 per diluted share, on
net sales of $278 million during the same period last year. The prior
period results also include non-recurring charges related to expenses
in connection with the Company's acquisition of Walker, totaling of
$1.7 million, and excluding the impact of these costs, non-GAAP
adjusted earnings were $6.7 million, or $0.10 per diluted share. 
In addition, the Company's effective income tax rate in the prior
period was negative 7.5 percent as it maintained a valuation
allowance against its net deferred tax assets. In the fourth quarter
of last year, the Company reversed its valuation allowance against
its net deferred tax assets. If the prior period results were tax
effected at 40.0 percent consistent with the current period, GAAP and
non-GAAP earnings per share would have been lower by $0.03 and $0.04
per diluted share respectively. The Company's Federal net operating
loss carryforward position as of December 31, 2012 was approximately
$111 million, of which $92 million is available for utilization in
2013. As a result, the Company expects cash taxes to be similar to
the amount paid in 2012 which was approximately $0.6 million. 
The Company reported income from operations totaling $14.9 million
for the first quarter of 2013, compared to operating income of $5.4
million for the first quarter of 2012. Non-GAAP operating EBITDA,
which excludes the effects of certain costs related to the Walker and
Beall acquisitions, as well as other recurring and non-recurring
items, for the first quarter of 2013 was $27.1 million, an
improvement of $14.8 million compared to the previous year period. On
a trailing twelve months basis, the Company's revenues have increased
to approximately $1.5 billion generating operating EBITDA of $133.3
million, or 8.8 percent. The improvement in operating performance is
attributed to the successful execution of the Company's growth
strategy and disciplined approach to improving profitability,
including an improved mix of higher-margin trailer orders and
diversification into higher margin opportunities through the
acquisition of Walker, which accounted for approximately $95 million
of the current quarter's net sales.  
The following is a summary of select operating and financial results
for the past five quarters: 


 
                                                                            
                                           Three Months Ended               
                           -------------------------------------------------
                            March 31,      June 30,       September 30,     
(Dollars in thousands)        2012           2012             2012          
                           ----------     ----------     --------------     
                                                                            
Net Sales                  $  277,682     $  362,408     $      405,917     
                                                                            
Gross Profit Margin              7.1%          10.9%              12.3%     
                                                                            
Income from Operations     $    5,449 (1) $    8,568 (1) $       27,236 (1) 
                                                                            
Net Income                 $    5,064 (1) $    1,942 (1) $       18,441 (1) 
                                                                            
Diluted EPS                $     0.07     $     0.03     $         0.27     
                                                                            
Non-GAAP Measures(3):                                                       
Operating EBITDA           $   12,293     $   29,685     $       37,695     
                                                                            
Operating EBITDA Margin          4.4%           8.2%               9.3%     
                                                                            
Adjusted Earnings          $    6,742     $   15,542     $       20,887     
                                                                            
Adjusted Diluted EPS       $     0.10     $     0.23     $         0.30     
                                                                            
 
                                                             
                                  Three Months Ended         
                          ---------------------------------- 
                           December 31,         March 31,    
(Dollars in thousands)         2012               2013       
                          -------------        ----------    
                                                             
Net Sales                 $     415,847        $  324,229    
                                                             
Gross Profit Margin               13.1%             13.0%    
                                                             
Income from Operations    $      29,231    (1) $   14,856 (1)
                                                             
Net Income                $      80,184 (1)(2) $    5,735 (1)
                                                             
Diluted EPS               $        1.16        $     0.08    
                                                             
Non-GAAP Measures(3):                                        
Operating EBITDA          $      38,834        $   27,134    
                                                             
Operating EBITDA Margin            9.3%              8.4%    
                                                             
Adjusted Earnings         $      21,678        $    6,106    
                                                             
Adjusted Diluted EPS      $        0.32        $     0.09    
                                                             
Notes:                                                                      
(1) Quarterly Income from Operations and Net Income include charges of $1.7 
    million, $13.6 million, $2.4 million, $0.5 million and $0.6 million for 
    the quarterly periods beginning with the first quarter of 2012 and      
    ending with the first quarter of 2013, respectively, in connection with 
    acquisition related charges 
associated with the Company's acquisition of
    Walker as well as the purchase of certain assets of Beall.              
(2) Net income for the fourth quarter of 2012 includes an income tax benefit
    of $59.0 million primarily related to the reversal of a U.S. valuation  
    allowance against its deferred tax assets.                              
(3) See "Non-GAAP Measures" below for explanation of the non-GAAP results   
    included above.                                                         

 
Dick Giromini, president and chief executive officer, stated, "We are
pleased with our first quarter performance, the continued execution
of our long-term strategic plan, and the progress we have made in
transforming Wabash National into a diversified industrial
manufacturer. First quarter results demonstrate the benefit of our
diversification strategy including a more balanced contribution from
our three segments to both the top-line and bottom-line. We also
continued to demonstrate our commitment to protecting and enhancing
the margins in the Commercial Trailer Products segment while
extending our reach in the higher margin Diversified Products
segment. This was reflected in the significant margin improvements
across all three segments compared to the prior year period. In
addition, we strengthened the diversified product po
rtfolio by
expanding our tank trailer product offering through our acquisition
of certain Beall assets, which was completed during the quarter."  
Mr. Giromini continued, "New trailer shipments for the first quarter
were approximately 8,600, consistent with our previous guidance of
8,000 to 9,000 trailers. We anticipate a significant increase in
customer pickups during the second quarter with trailer shipments
expected to be between 11,000 to 12,000 trailers. We continue to
expect the full year trailer shipments to be between 45,000 and
48,000 units. Our backlog increased during the quarter and remains at
a healthy level of approximately $674 million as of March 31, 2013.
Longer-term, we believe the demand environment for trailers will
remain strong as key drivers support continued demand for new
trailers such as fleet age, customer profitability, used trailer
values, regulatory compliance and access to financing all support
continued demand for new trailers. On the backdrop of these industry
tailwinds, we remain focused on delivering the most innovative and
highest quality products with the best value to our customers across
all of our business segments."  
First Quarter Business Segment Highlights
 The table below is a
summary of select segment operating and financial results prior to
the elimination of intersegment sales for the first quarter of 2013
and 2012, respectively. A complete disclosure of the results by
individual segment is included in the tables following this release. 


 
                                                                            
                                       Commercial                           
                                         Trailer    Diversified             
                                        Products     Products      Retail   
                                       ----------  ------------  ---------- 
Three months ended March 31, 2013                                           
New trailers shipped                        8,000           600         600 
Net sales                              $  198,077  $    111,994  $   40,843 
Gross profit                           $   11,634  $     25,928  $    4,880 
Gross profit margin                           5.9%         23.2%       11.9%
Income from operations                 $    5,320  $     13,519  $      873 
Income from operations margin                 2.7%         12.1%        2.1%
                                                                            
2012                                                                        
New trailers shipped                       10,400             -         300 
Net sales                              $  243,380  $     31,590  $   25,120 
Gross profit                           $   11,641  $      6,458  $    2,479 
Gross profit margin       
                    4.8%         20.4%        9.9%
Income (Loss) from operations          $    6,187  $      5,384  $      (75)
Income (Loss) from operations margin          2.5%         17.0%       -0.3%

 
Commercial Trailer Products' net sales decreased $45.3 million or 18.6
percent, on 8,000 units, 2,400 fewer units than the prior year
period. However, consistent with the Company's efforts last year to
improve pricing on our products, to recover material cost increases,
and to improve the product mix, the Company's average selling prices
increased $1,100 or 4.7 percent compared to the prior year period. As
a result, gross margin improved 110 basis points to 5.9 percent
compared to the prior year period. Operating income decreased to $5.3
million which was $0.9 million lower than first quarter last year
primarily due to lower trailer shipments. 
Diversified Products' net sales increased $80.4 million, or 255
percent, with Walker contributing $88.1 million in the current
quarter. Gross margins improved by 280 basis points from 20.4 percent
to 23.2 percent, driven by the Walker acquisition and productivity
improvements realized in the Wabash Wood Products business. Operating
income increased 151 percent or $8.1 million as compared to the same
period last year, primarily due to the Walker acquisition, partially
offset by lower volume in our composite product offerings. 
Retail's net sales increased $15.7 million or 63 percent, gross
margins increased 200 basis points to 11.9 percent and operating
income improved $0.9 million for the quarter. Results were favorably
impacted by the contribution of the Walker parts and service business
and an increase in new trailer shipments of approximately 300 units,
or 100 percent. 
Term Loan Re-pricing
 On April 25, 2013 the Company executed an
amendment to its term loan credit agreement which will become
effective on May 9, 2013. The amendment to the credit agreement
reduces the effective interest costs by up to 150 basis points and
removed the interest coverage ratio covenant. Concurrent with the
closing on the amendment, the Company will pay $20 million towards
the outstanding balance of the loan. Post-closing, the outstanding
balance will be $277 million and combined with the rate reductions,
the Company's annual interest costs will be reduced by approximately
$5 million. All other material terms and conditions remain the same,
including the maturity date of the loan. 
Non-GAAP Measures
 In addition to disclosing financial results
calculated in accordance with United States generally accepted
accounting principles (GAAP), the financial information included in
this release contain non-GAAP financial measures, including Operating
EBITDA, Operating EBITDA margin, adjusted earnings and adjusted
earnings per diluted share. 
These non-GAAP measures should not be considered a substitute for, or
superior to, financial measures and results calculated in accordance
with GAAP, including net income, and reconciliations to GAAP
financial statements should be carefully evaluated.  
Operating EBITDA is defined as earnings before interest, taxes,
depreciation, amortization, stock-based compensation, and other
non-operating income and expense, as well as certain charges in
connection with the Company's acquisitions of Walker and certain
assets of Beall. Management believes Operating EBITDA provides useful
information to investors regarding our results of operations. The
Company provides this measure because we believe it is useful for
investors to understand our performance period to period with the
exclusion of the recurring and non-recurring items identified above.
Management believes the presentation of Operating EBITDA, when
combined with the primary GAAP presentation of operating income, is
beneficial to an investor's understanding of the Company's operating
performance. A reconciliation of Operating EBITDA to net income is
included in the tables following this release. 
Adjusted earnings and adjusted earnings per diluted share reflect
adjustments for non-recurring charges related to expenses in
connection with the Company's acquisitions of Walker and certain
assets of Beall, as well as the impact of the release of the
valuation allowances recorded against the Company's net deferred tax
assets. Management believes providing this measure and excluding the
impact of the non-recurring expenses attributable to the acquisitions
of Walker and certain assets of Beall, as well as the impact of the
release of the valuation allowances, facilitates comparisons to the
Company's prior year periods and when combined with the primary GAAP
presentation of net income and diluted net income per share, is
beneficial to an investor's understanding of the Company's
performance. A reconciliation of adjusted earnings and adjusted
earnings per diluted share to net income and diluted net income per
share is included in the tables following this release.  
First Quarter 2013 Conference Call
 Wabash National will conduct a
conference call to review and discuss its first quarter results on
May 1, 2013, at 10:00 a.m. EDT. Access to the live webcast will be
available on the Company's website at www.wabashnational.com. For
those unable to participate in the live webcast, the call will be
archived at www.wabashnational.com within three hours of the
conclusion of the live call and will remain available through July
24, 2013. Meeting access also will be available via conference call
at 888-771-4371, participant code 34706280. 
Wabash National Analyst / Investor Day
 Wabash National Corporation
will host its Analyst / Investor Day event for institutional
investors and analysts on May 8, 2013. The event will begin at 8:00
AM EST at Wabash National's Ehrlich Innovation Center located in
Lafayette, IN. Attendees will be provided with a tour of Lafayette
manufacturing operations, including product displays, and
presentations by members of Wabash National's Executive Team,
including Wabash National CEO Dick Giromini, on key growth and
diversification initiatives. To request information regarding this
event, please send an email to investor.relations@wabashnational.com. 
About Wabash National Corporation
 Headquartered in Lafayette,
Indiana, Wabash National Corporation (NYSE: WNC) is a diversified
manufacturer and North America's leading producer of semi trailers
and liquid transportation systems. Established in 1985, the Company
specializes in the design and production of dry freight vans,
refrigerated vans, platform trailers, intermodal equipment, liquid
tank trailers, frac tanks, engineered products, and composite
products. Wabash National operates three wholly-owned subsidiaries:
Transcraft Corporation, Walker Group Holdings LLC, and Wabash
National Trailer Centers, Inc. Its innovative products are sold under
the following brand names: Wabash National(R), Transcraft(R),
Benson(R), DuraPlate(R), ArcticLite(R), Walker Transport, Walker
Stainless Equipment, Walker Defense Group, Walker Barrier Systems,
Walker Engineered Products, Brenner(R) Tank, Garsite, Progress Tank,
TST, Bulk Tank International, Beall(R) and Extract Technology(R). To
learn more, visit www.wabashnational.com. 
Safe Harbor Statement
 This press release contains certain
forward-looking statements as defined by the Private Securities
Litigation Reform Act of 1995. Forward-looking statements convey the
Company's current expectations or forecasts of future events. All
statements contained in this press release other than statements of
historical fact are forward-looking statements. These forward-looking
statements include, among other things, statements regarding our
outlook for new trailer shipments and Operating EBITDA, backlog,
expectations regarding trailer demand levels, improved profitability
and earnings capacity, customer pickup expectations, opportunity to
capture higher margin sales, and the benefits of the acquisitions of
Walker and certain assets of Beall. These and the Company's other
forward-looking statements are subject to certain risks and
uncertainties that could cause actual results to differ materially
from those implied by the forward-looking statements. Without
limitation, these risks and uncertainties include the uncertain
economic conditions including the possibility that demand
expectations may not result in order increases for us, increased
competition, reliance on certain customers and corporate
partnerships, risks of customer pick-up delays, shortages and costs
of raw materials, risks in implementing and sustaining improvements
in our manufacturing capacity and cost containment, dependence on
industry trends and timing, costs of indebtedness incurred in
connection with the acquisition of Walker and the failure to achieve
the benefit of the Walker acquisition and Beall asset purchase.
Readers should review and consider the various disclosures made by
the Company in this press release and in the Company's reports to its
stockholders and periodic reports on Forms 10-K and 10-Q. 


 
                                                                            
                                                                            
                        WABASH NATIONAL CORPORATION                         
              CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS               
              (Dollars in thousands, except per share amounts)              
                                (Unaudited)                                 
                                                                            
                                                     Three Months Ended     
                                                          March 31,         
                                                 -------------------------- 
                                                     2013          2012     
                                                 ------------  ------------ 
                                                                            
Net sales                                        $    324,229  $    277,682 
Cost of sales                                         282,043       257,953 
                                                 ------------  ------------ 
  Gross profit                                         42,186        19,729 
                                                                            
General and administrative expenses                    13,675         8,368 
Selling expenses                                        7,667         3,496 
Amortization of intangibles                             5,370           738 
Acquisition expenses                                      618         1,678 
                                                 ------------  ------------ 
  Income from operations                               14,856         5,449 
                                                                            
Other income (expense):                                                     
  Interest expense                                     (7,535)         (733)
  Other, net                                            2,238            (4)
                                                 ------------  ------------ 
  Income before income taxes                            9,559         4,712 
Income tax expense (benefit)                            3,824          (352)
                                                 ------------  ------------ 
Net income                                       $      5,735  $      5,064 
                                                 ============  ============ 
Basic and diluted net income per share           $       0.08  $       0.07 
                                                 ============  ============ 
                                                                            
Comprehensive income                                                        
  Net income                                     $      5,735  $      5,064 
  Foreign currency translation adjustment                (255)            - 
                                                 ------------  ------------ 
Net comprehensive income                         $      5,480  $      5,064 
                                                 ============  ============ 
                                                                            
                                                                            
Basic net income per share:                                                 
  Net income applicable to common stockholders   $      5,735  $      5,064 
  Undistributed earnings allocated to                                       
   participating securities                               (51)          (40)
                                                 ------------  ------------ 
  Net income applicable to common stockholders                              
   excluding amounts applicable to participating                            
   securities                                    $      5,684  $      5,024 
                                                 ============  ============ 
  Weighted average common shares outstanding           68,395        68,245 
                                                 ============  ============ 
  Basic net income per share                     $       0.08  $       0.07 
                                                 ============  ============ 
                                                                            
Diluted net income per share:                                               
  Net income applicable to common stockholders   $      5,735  $      5,064 
  Undistributed earnings allocated to                                       
   participating securities                               (51)          (40)
                                                 ------------  ------------ 
  Net income applicable to common stockholders                              
   excluding amounts applicable to participating                            
   securities                                    $      5,684  $      5,024 
                                                 ============  ============ 
                                                                            
  Weighted average common shares outstanding           68,395        68,245 
  Dilutive stock options and restricted stock             433           373 
                                                 ------------  ------------ 
  Diluted weighted average common shares                                    
   outstanding                                         68,828        68,618 
                                                 ============  ============ 
  Diluted net income per share                   $       0.08  $       0.07 
                                                 ============  ============ 
                                                                            
                                                                            
                                                                            
                         WABASH NATIONAL CORPORATION                        
                      SEGMENTS AND RELATED INFORMATION                      
                           (Dollars in thousands)                           
                                 (Unaudited)                                
                                                                            
Three Months     Commercial                         Corporate               
 Ended March 31,   Trailer   Diversified               and                  
 2013             Products    Products    Retail  Eliminations  Consolidated
                 ---------- ------------ -------  ------------  ------------
New trailers                                                                
 shipped              8,000          600     600          (600)        8,600
Used trailers                                                               
 shipped                700            -     300             -         1,000
                                                                            
New Trailers     $  188,979 $     43,521 $16,943  $    (13,976) $    235,467
Used Trailers         5,050          949   2,653            (5)        8,647
Components,                                                                 
 parts and                                                                  
 service              2,819       21,061  19,963        (2,558)       41,285
Equipment and                                                               
 other                1,229       46,463   1,284       (10,146)       38,830
                 ---------- ------------ -------  ------------  ------------
  Total net                                                                 
   external                                                                 
   sales         $  198,077 $    111,994 $40,843  $    (26,685) $    324,229
                                                                            
Gross profit     $   11,634 $     25,928 $ 4,880  $       (256) $     42,186
Income (Loss)                                                               
 from operations $    5,320 $     13,519 $   873  $     (4,856) $     14,856
                                                                            
      2012                                                                  
New trailers                                                                
 shipped             10,400            -     300          (400)       10,300
Used trailers                                                               
 shipped                600            -     400             -         1,000
                                                                            
New Trailers     $  235,091 $          - $ 9,891  $     (9,790) $    235,192
Used Trailers         4,148            -   3,437             -         7,585
Components,                                                                 
 parts and                                                                  
 service                589       16,653  11,769        (2,433)       26,578
Equipment and                                                               
 other                3,552       14,937      23       (10,185)        8,327
                 ---------- ------------ -------  ------------  ------------
  Total net                                                                 
   external                                                                 
   sales         $  243,380 $     31,590 $25,120  $    (22,408) $    277,682
                                                                            
Gross profit     $   11,641 $      6,458 $ 2,479  $       (849) $     19,729
Income (Loss)                                                               
 from operations $    6,187 $      5,384 $   (75) $     (6,047) $      5,449
                                                                            
                                                                            
                                                                            
                         WABASH NATIONAL CORPORATION                        
                    CONDENSED CONSOLIDATED BALANCE SHEETS                   
                           (Dollars in thousands)                           
                                                                            
                                                   March 31,    December 31,
                                                      2013          2012    
                                                 ------------- -------------
                                                  (Unaudited)               
                                   ASSETS                                   
Current assets                                                              
  Cash                                           $      58,633 $      81,449
  Accounts receivable                                  101,260        96,590
  Inventories                                          237,013       189,487
  Deferred income taxes                                 40,755        42,330
  Prepaid expenses and other                             5,904         8,239
                                                 ------------- -------------
    Total current assets                         $     443,565 $     418,095
                                                                            
Property, plant and equipment                          137,858       132,146
                                                                            
Deferred income taxes                                   19,681        21,894
                                                                            
Goodwill                                               148,157       146,444
                                                                            
Intangible assets                                      175,474       171,990
                                                                            
Other assets                                            10,540        12,057
                                                 ------------- -------------
                                                 $     935,275 $     902,626
                                                 ============= =============
                                                                            
                    LIABILITIES AND STOCKHOLDERS' EQUITY                    
Current liabilities                                                         
  Current portion of long-term debt              $      23,460 $       3,381
  Current portion of capital lease obligations           1,532         1,140
  Accounts payable                                     126,233        87,299
  Other accrued liabilities                             86,622       104,873
                                                 ------------- -------------
    Total current liabilities                    $     237,847 $     196,693
                                                                            
Long-term debt                                         397,108       416,849
                                                                            
Capital lease obligations                                7,388         3,781
                                                                            
Other noncurrent liabilities                            16,306        15,511
                                                                            
Deferred income taxes                                    1,066         1,065
                                                                            
Commitments and contingencies                                               
                                                                            
Stockholders' equity                                   275,560       268,727
                                                 ------------- -------------
                                                 $     935,275 $     902,626
                                                 ============= =============
                                                                            
                                                                            
                                                                            
                        WABASH NATIONAL CORPORATION                         
              CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS               
                           (Dollars in thousands)                           
                                (Unaudited)                                 
                                                                            
                                                     Three Months Ended     
                                                          March 31,         
                                                 -------------------------- 
                                                     2013          2012     
                                                 ------------  ------------ 
                                                                            
Cash flows from operating activities                                        
  Net income                                     $      5,735  $      5,064 
  Adjustments to reconcile net income to net                                
   cash used in operating activities                                        
    Depreciation                                        4,406         3,031 
    Amortization of intangibles                         5,370           738 
    Deferred taxes                                      3,790             - 
    Stock-based compensation                            1,884         1,397 
    Accretion of debt discount                          1,126             - 
    Changes in operating assets and liabilities                             
      Accounts receivable                              (4,593)      (10,736)
      Inventories                                     (46,580)      (25,841)
      Prepaid expenses and other                          (83)          (94)
      Accounts payable and accrued liabilities         19,563         4,826 
      Other, net                                        1,716        (2,437)
                                                 ------------  ------------ 
        Net cash used in operating activities    $     (7,666) $    (24,052)
                                                                            
Cash flows from investing activities                                        
  Capital expenditures                                 (2,564)         (967)
  Acquisition                                         (13,860)            - 
  Other                                                 2,418             - 
                                                 ------------  ------------ 
        Net cash used in investing activities    $    (14,006) $       (967)
                                                                            
Cash flows from financing activities                                        
  Proceeds from exercise of stock options                 161           163 
  Borrowings under revolving credit facilities            223       113,632 
  Payments under revolving credit facilities             (223)     (101,132)
  Principal payments under capital lease                                    
   obligations                                           (441)         (910)
  Principal payments under term loan credit                                 
   facility                                              (750)            - 
  Principal payments under industrial revenue                               
   bond                                                   (38)            - 
  Debt issuance costs paid                                (41)            - 
  Stock repurchase                                        (35)         (564)
                                                 ------------  ------------ 
        Net cash (used in) provided by financing                            
         activities                              $     (1,144) $     11,189 
                                                 ------------  ------------ 
                                                                            
Net decrease in cash                             $    (22,816) $    (13,830)
Cash at beginning of period                            81,449        19,976 
                                                 ------------  ------------ 
Cash at end of period                            $     58,633  $      6,146 
                                                 ============  ============ 
                                                                            
                                                                            
                                                                            
                        WABASH NATIONAL CORPORATION                         
                RECONCILIATION OF GAAP FINANCIAL MEASURES TO                
                        NON-GAAP FINANCIAL MEASURES                         
              (Dollars in thousands, except per share amounts)              
                                (Unaudited)                                 
                                                                            
Operating EBITDA:                                                           
                   Three Months Ended                                       
                       March 31,                                            
                  -------------------                                       
                    2013       2012                                         
                  --------  ---------                                       
Net income        $  5,735  $   5,064                                       
Income tax expense                                                          
 (benefit)           3,824       (352)                                      
Interest expense     7,535        733                                       
Depreciation and                                                            
 amortization        9,776      3,769                                       
Stock-based                                                                 
 compensation        1,884      1,397                                       
Acquisition                                                                 
 expenses and                                                               
 related charges       618      1,678                                       
Other non-                                                                  
 operating                                                                  
 (income) expense   (2,238)         4                                       
                  --------  ---------                                       
Operating EBITDA  $ 27,134  $  12,293                                       
                  ========  =========                                       
                                                                            
                                                                            
                        Three Months Ended                                  
                  ------------------------------                            
                  June 30,  September   December                            
                    2012     30, 2012   31, 2012                            
                  --------  ---------  ---------                            
Net income        $  1,942  $  18,441  $  80,184                            
Income tax expense                                                          
 (benefit)           1,129      1,246    (58,991)                           
Interest expense     5,441      7,760      7,790                            
Depreciation and                                                            
 amortization        7,063      7,003      7,730                            
Stock-based                                                                 
 compensation          754      1,460      1,538                            
Acquisition                                                                 
 expenses and                                                               
 related charges    13,300      1,996        335                            
Other non-                                                                  
 operating expense                                                          
 (income)               56       (211)       248                            
                  --------  ---------  ---------                            
Operating EBITDA  $ 29,685  $  37,695  $  38,834                            
                  ========  =========  =========                            
                                                                            
                                                                            
Adjusted Earnings:                                                          
                        Three Months Ended March 31,                        
                  ----------------------------------------                  
                          2013                 2012                         
                  -------------------  -------------------                  
                                                     Per                    
                      $     Per Share      $        Share                   
                  --------  ---------  ---------  --------                  
                                                                            
Net Income        $  5,735  $    0.08  $   5,064  $   0.07                  
                                                                            
Adjustments:                                                                
  Acquisition                                                               
   expenses, net                                                            
   of taxes            371       0.01      1,678      0.02                  
                  --------  ---------  ---------  --------                  
                                                                            
Adjusted earnings $  6,106  $    0.09  $   6,742  $   0.10                  
                  ========  =========  =========  ========                  
                                                                            
                                                                            
                                                                            
                                      Three Months Ended                    
                  --------------------------------------------------------- 
                                          September 30,      December 31,   
                     June 30, 2012             2012              2012       
                  -------------------  ------------------- ---------------- 
                                                     Per              Per   
                      $     Per Share      $        Share     $      Share  
                  --------  ---------  ---------  -------- -------  ------- 
                                                                            
Net Income        $  1,942  $    0.03  $  18,441  $   0.27 $80,184  $  1.17 
                                                                            
Adjustments:                                                                
  Income tax                                                          
   benefit               -          -          -         - (58,991)   (0.86)
  Acquisition                                                               
   expenses         12,224       0.18        172         -     335        - 
  Impact of                                                                 
   acquired profit                                                          
   in inventories                                                           
   and short term                                                           
   intangible                                                               
   amortization      1,376       0.02      2,274      0.03     150        - 
                  --------  ---------  ---------  -------- -------  ------- 
                                                                            
Adjusted earnings $ 15,542  $    0.23  $  20,887  $   0.30 $21,678  $  0.32 
                  ========  =========  =========  ======== =======  ======= 

  
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