HILLENBRAND INC (HI, Financial) filed Quarterly Report for the period ended 2009-12-31.
Hillenbrand Inc has a market cap of $1.15 billion; its shares were traded at around $18.56 with a P/E ratio of 11 and P/S ratio of 1.7. The dividend yield of Hillenbrand Inc stocks is 4.1%.HI is in the portfolios of Diamond Hill Capital of Diamond Hill Capital Management Inc, Richard Aster Jr of Meridian Fund, Chuck Royce of ROYCE & ASSOCIATES.
Revenue Our net revenues for the quarter were down from the same period last year, decreasing $5.0 million or 3.0%. Burial unit volume decreased 3.1% contributing to a reduction of $5.8 million over the same period last year. We believe this volume decrease was largely attributable to lower total deaths and an increase in cremation rates resulting in fewer burials year over year. Additionally, during the same period, our average selling price decreased slightly causing a reduction in revenue of $0.6 million from the prior year. Although we cannot predict with certainty as to whether this trend will continue, at this time we do not anticipate significant erosion in average selling price over the remainder of the fiscal year when compared to last fiscal year. Finally, we experienced the favorable impact of currency fluctuations during the quarter from the weakening U.S. dollar, mainly compared to the Canadian dollar, resulting in increased revenues of $1.4 million over the same period in the prior year.
Cost of Goods Sold Our cost of goods sold decreased $7.2 million, or 7.4%, including a decrease of $1.9 million attributable to lower burial unit volume. In our manufacturing operations, we experienced commodity cost decreases of $4.2 million over the same period last year, most notably on steel. An aggregate cost increase of $0.8 million was attributable to a number of other categories across our manufacturing operations.
Operating Expenses, excluding business acquisition costs Core operating expenses decreased $2.8 million, or 9.1%, excluding business acquisition costs. We believe we are better able to analyze our operating cost structure without the effects of business acquisition costs due to the volatile nature of these costs. Within our core Batesville operating expenses, we experienced cost increases of $1.0 million largely attributable to employee compensation expense, both fixed and variable. These cost increases were partially offset by lower antitrust lawsuit expense of approximately $0.4 million. Other, increases of $0.4 million were attributable to other components across our core Batesville operating expense categories. We also incurred $0.3 million of increased corporate costs primarily related to variable compensation.
We expect the planned acquisition of K-Tron to increase our net cash flow generated by operating activities. Over the past three calendar years, K-Tron has generated net cash flows from operations of between $19.0 million to $26.7 million annually. Any increase during the remainder of fiscal 2010 will be offset by the non-recurring business acquisition and transition costs associated with the transaction, which are expected to be approximately $10.0 million to $12.0 million.
On January 8, 2010, we entered into a material definitive agreement with K-Tron, which provides for the planned merger between us and K-Tron, and is subject to satisfaction of certain standard terms and conditions. We are to purchase, for cash, all the outstanding shares of K-Tron, including shares issuable under K-Trons stock incentive plans at $150 dollars per share. We estimate that the acquisition will have an aggregate purchase price of $435.0 million, and excludes approximately $10.0 million to $12.0 million in additional business acquisition and other transition related costs. We expect the acquisition to close on or around March 31, 2010, and plan to fund the acquisition with existing cash on hand and proceeds from debt financing.
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Hillenbrand Inc has a market cap of $1.15 billion; its shares were traded at around $18.56 with a P/E ratio of 11 and P/S ratio of 1.7. The dividend yield of Hillenbrand Inc stocks is 4.1%.HI is in the portfolios of Diamond Hill Capital of Diamond Hill Capital Management Inc, Richard Aster Jr of Meridian Fund, Chuck Royce of ROYCE & ASSOCIATES.
Highlight of Business Operations:
On January 8, 2010, we entered into a material definitive merger agreement with K-Tron International, Inc. (K-Tron). The merger agreement provides for our acquisition of all the outstanding shares of K-Tron, including shares issuable under K-Trons stock incentive plans, for $150 dollars per share in cash. The transaction is expected to have an aggregate purchase price of approximately $435.0 million and is expected to close on or about March 31, 2010. We intend to use cash on hand and proceeds from debt financing to fund the acquisition. The closing of the merger is subject to customary terms and conditions, including the approval by K-Trons shareholders and the expiration or termination of the waiting period required under the Hart-Scott-Rodino Antitrust Improvements Act. During the three months ended December 31, 2009, we incurred business acquisition costs of approximately $2.8 million related to the planned acquisition of K-Tron. Aggregate business acquisition and transition costs in fiscal 2010 are expected to be approximately $10.0 million to $12.0 million.Revenue Our net revenues for the quarter were down from the same period last year, decreasing $5.0 million or 3.0%. Burial unit volume decreased 3.1% contributing to a reduction of $5.8 million over the same period last year. We believe this volume decrease was largely attributable to lower total deaths and an increase in cremation rates resulting in fewer burials year over year. Additionally, during the same period, our average selling price decreased slightly causing a reduction in revenue of $0.6 million from the prior year. Although we cannot predict with certainty as to whether this trend will continue, at this time we do not anticipate significant erosion in average selling price over the remainder of the fiscal year when compared to last fiscal year. Finally, we experienced the favorable impact of currency fluctuations during the quarter from the weakening U.S. dollar, mainly compared to the Canadian dollar, resulting in increased revenues of $1.4 million over the same period in the prior year.
Cost of Goods Sold Our cost of goods sold decreased $7.2 million, or 7.4%, including a decrease of $1.9 million attributable to lower burial unit volume. In our manufacturing operations, we experienced commodity cost decreases of $4.2 million over the same period last year, most notably on steel. An aggregate cost increase of $0.8 million was attributable to a number of other categories across our manufacturing operations.
Operating Expenses, excluding business acquisition costs Core operating expenses decreased $2.8 million, or 9.1%, excluding business acquisition costs. We believe we are better able to analyze our operating cost structure without the effects of business acquisition costs due to the volatile nature of these costs. Within our core Batesville operating expenses, we experienced cost increases of $1.0 million largely attributable to employee compensation expense, both fixed and variable. These cost increases were partially offset by lower antitrust lawsuit expense of approximately $0.4 million. Other, increases of $0.4 million were attributable to other components across our core Batesville operating expense categories. We also incurred $0.3 million of increased corporate costs primarily related to variable compensation.
We expect the planned acquisition of K-Tron to increase our net cash flow generated by operating activities. Over the past three calendar years, K-Tron has generated net cash flows from operations of between $19.0 million to $26.7 million annually. Any increase during the remainder of fiscal 2010 will be offset by the non-recurring business acquisition and transition costs associated with the transaction, which are expected to be approximately $10.0 million to $12.0 million.
On January 8, 2010, we entered into a material definitive agreement with K-Tron, which provides for the planned merger between us and K-Tron, and is subject to satisfaction of certain standard terms and conditions. We are to purchase, for cash, all the outstanding shares of K-Tron, including shares issuable under K-Trons stock incentive plans at $150 dollars per share. We estimate that the acquisition will have an aggregate purchase price of $435.0 million, and excludes approximately $10.0 million to $12.0 million in additional business acquisition and other transition related costs. We expect the acquisition to close on or around March 31, 2010, and plan to fund the acquisition with existing cash on hand and proceeds from debt financing.
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