Valmont Industries Inc. (VMI, Financial) filed Quarterly Report for the period ended 2010-03-27.
Valmont Industries Inc. has a market cap of $2.19 billion; its shares were traded at around $83.27 with a P/E ratio of 16.8 and P/S ratio of 1.3. The dividend yield of Valmont Industries Inc. stocks is 0.7%. Valmont Industries Inc. had an annual average earning growth of 15.8% over the past 10 years. GuruFocus rated Valmont Industries Inc. the business predictability rank of 3-star.VMI is in the portfolios of Ron Baron of Baron Funds, John Keeley of Keeley Fund Management, Chuck Royce of Royce& Associates, Kenneth Fisher of Fisher Asset Management, LLC, Jim Simons of Renaissance Technologies LLC, Murray Stahl of Horizon Asset Management, Steven Cohen of SAC Capital Advisors, George Soros of Soros Fund Management LLC.
On March 4, 2010, we made an offer to acquire all the ordinary shares of Delta plc ("Delta"), a public company traded on the London Stock exchange under the symbol "DLTA". The offer price was £1.85 per ordinary share, with a total estimated purchase price of $439 million, based on an average exchange rate of $1.543/£. To manage the foreign exchange risk associated with the offer, we executed a forward foreign exchange contract with a multinational bank, whereby, if the acquisition is completed, the required British pound sterling would be delivered to us at a fixed exchange rate of $1.543/£ to complete the acquisition. If the acquisition is not completed, the contract will be terminated at no cost to us. In accordance with takeover rules in the United Kingdom, we established funding for the purchase price and related acquisition costs by a combination of $264 million in restricted cash (comprised of cash balances of $83 million and $181 million in borrowings under our revolving credit agreement) and a $200 million bank bridge loan commitment. In April 2010, we issued $300 million of
SG&A expenses of $2.2 million related to acquisition costs, including costs associated with our review of Delta's operations and financial statements. These costs, under applicable accounting standards, are required to be recorded as expenses as incurred. Interest expenses aggregating $2.8 million related to fees and expenses to establish the bridge loan and borrowing costs incurred in relation to the $181 million borrowed under our revolving credit agreement. The after-tax impact of these expenses on our net income for the quarter ended March 27, 2010 was approximately $3.4 million.
Working Capital and Operating Cash FlowsNet working capital was $665.7 million at March 27, 2010, as compared with $458.6 million at December 26, 2009. The increase in net working capital in 2010 mainly resulted from $181.0 million in additional borrowing under our revolving credit agreement related to the proposed Delta acquisition that is reflected in our cash balances at March 27, 2010. Operating cash flow was $19.3 million for the thirteen week period ended March 27, 2010, as compared with $37.5 million for the same period in 2009. The decrease in operating cash flow in 2010 mainly was the result of lower net earnings 2010, as compared with 2009. Accounts receivable turnover in the first quarter of 2010 was comparable with the same period in 2009.
Investing Cash FlowsCapital spending during the thirteen weeks ended March 27, 2010 was $4.6 million, as compared with $14.0 million for the same period in 2009. We expect our capital spending for the 2010 fiscal year to be approximately $50 million. Investing cash flows for fiscal 2010 included $264.0 million of restricted cash associated with the proposed acquisition of Delta. Investing cash flows for 2010 also include an aggregate of approximately $7.5 million associated with increasing our ownership interest in West Coast Engineering, Ltd. from 70% to 80% and the additional purchase price paid to the former shareholders of Stainton related to the performance of the operation after its acquisition in November 2008.
$150 million of senior subordinated notes that bear interest at 6.875% per annum and are due in May 2014. We are allowed to repurchase the notes at specified prepayment premiums. These notes are guaranteed by certain of our U.S. subsidiaries. $280 million revolving credit agreement with a group of banks. We may increase the credit facility by up to an additional $100 million at any time, subject to participating banks increasing the amount of their lending commitments. The interest rate on our borrowings will be, at our option, either: (a)LIBOR (based on a 1, 2, 3 or 6 month interest period, as selected by us) plus 125 to 200 basis points (inclusive of facility fees), depending on our ratio of debt to earnings before taxes, interest, depreciation and amortization (EBITDA), or; (b)the higher of 27
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Valmont Industries Inc. has a market cap of $2.19 billion; its shares were traded at around $83.27 with a P/E ratio of 16.8 and P/S ratio of 1.3. The dividend yield of Valmont Industries Inc. stocks is 0.7%. Valmont Industries Inc. had an annual average earning growth of 15.8% over the past 10 years. GuruFocus rated Valmont Industries Inc. the business predictability rank of 3-star.VMI is in the portfolios of Ron Baron of Baron Funds, John Keeley of Keeley Fund Management, Chuck Royce of Royce& Associates, Kenneth Fisher of Fisher Asset Management, LLC, Jim Simons of Renaissance Technologies LLC, Murray Stahl of Horizon Asset Management, Steven Cohen of SAC Capital Advisors, George Soros of Soros Fund Management LLC.
Highlight of Business Operations:
Selling, general and administrative (SG&A) spending in the first quarter of 2010 was comparable to 2009. SG&A expense increases in 2010 included approximately $2.2 million of expenses incurred as part of the proposed Delta acquisition and approximately $1.2 million due to currency translation. These increases were more than offset by lower employee incentive expenses in 2010, as compared with 2009 (approximately $2.9 million), and lower sales commissions related to lower net sales in 2010, as compared with 2009 (approximately $1.0 million).On March 4, 2010, we made an offer to acquire all the ordinary shares of Delta plc ("Delta"), a public company traded on the London Stock exchange under the symbol "DLTA". The offer price was £1.85 per ordinary share, with a total estimated purchase price of $439 million, based on an average exchange rate of $1.543/£. To manage the foreign exchange risk associated with the offer, we executed a forward foreign exchange contract with a multinational bank, whereby, if the acquisition is completed, the required British pound sterling would be delivered to us at a fixed exchange rate of $1.543/£ to complete the acquisition. If the acquisition is not completed, the contract will be terminated at no cost to us. In accordance with takeover rules in the United Kingdom, we established funding for the purchase price and related acquisition costs by a combination of $264 million in restricted cash (comprised of cash balances of $83 million and $181 million in borrowings under our revolving credit agreement) and a $200 million bank bridge loan commitment. In April 2010, we issued $300 million of
SG&A expenses of $2.2 million related to acquisition costs, including costs associated with our review of Delta's operations and financial statements. These costs, under applicable accounting standards, are required to be recorded as expenses as incurred. Interest expenses aggregating $2.8 million related to fees and expenses to establish the bridge loan and borrowing costs incurred in relation to the $181 million borrowed under our revolving credit agreement. The after-tax impact of these expenses on our net income for the quarter ended March 27, 2010 was approximately $3.4 million.
Working Capital and Operating Cash FlowsNet working capital was $665.7 million at March 27, 2010, as compared with $458.6 million at December 26, 2009. The increase in net working capital in 2010 mainly resulted from $181.0 million in additional borrowing under our revolving credit agreement related to the proposed Delta acquisition that is reflected in our cash balances at March 27, 2010. Operating cash flow was $19.3 million for the thirteen week period ended March 27, 2010, as compared with $37.5 million for the same period in 2009. The decrease in operating cash flow in 2010 mainly was the result of lower net earnings 2010, as compared with 2009. Accounts receivable turnover in the first quarter of 2010 was comparable with the same period in 2009.
Investing Cash FlowsCapital spending during the thirteen weeks ended March 27, 2010 was $4.6 million, as compared with $14.0 million for the same period in 2009. We expect our capital spending for the 2010 fiscal year to be approximately $50 million. Investing cash flows for fiscal 2010 included $264.0 million of restricted cash associated with the proposed acquisition of Delta. Investing cash flows for 2010 also include an aggregate of approximately $7.5 million associated with increasing our ownership interest in West Coast Engineering, Ltd. from 70% to 80% and the additional purchase price paid to the former shareholders of Stainton related to the performance of the operation after its acquisition in November 2008.
$150 million of senior subordinated notes that bear interest at 6.875% per annum and are due in May 2014. We are allowed to repurchase the notes at specified prepayment premiums. These notes are guaranteed by certain of our U.S. subsidiaries. $280 million revolving credit agreement with a group of banks. We may increase the credit facility by up to an additional $100 million at any time, subject to participating banks increasing the amount of their lending commitments. The interest rate on our borrowings will be, at our option, either: (a)LIBOR (based on a 1, 2, 3 or 6 month interest period, as selected by us) plus 125 to 200 basis points (inclusive of facility fees), depending on our ratio of debt to earnings before taxes, interest, depreciation and amortization (EBITDA), or; (b)the higher of 27
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