SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
February 16, 1999
GROVE HOLDINGS LLC
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(Exact Name of Registrant as Specified in its Charter)
Delaware
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(State or other jurisdiction of incorporation)
333-57609 52-2089467
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(Commission File Number) (IRS Employer Identification Number)
1565 Buchanan Trail East, Shady Grove, PA 17256
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(Address of Principal Executive Offices)
(717) 597-8121
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(Registrant's Telephone Number, Including Area Code)
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Item 5. Other Events.
On February 16, 1999, Grove Holdings LLC (the "Company"), the parent
company of Grove Worldwide LLC, issued the press release attached hereto as
Exhibit 99.1 and incorporated herein by reference.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Businesses Acquired.
None.
(b) Pro Forma Financial Information.
None.
(c) Exhibits.
99.1 Press Release of the Company dated February 16, 1999.
SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: February 16, 1999
GROVE HOLDINGS LLC
By: /s/ Stephen L. Cripe
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Stephen L. Cripe
Chief Financial Officer
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EXHIBIT INDEX
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Exhibit No. Description
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99.1 Press Release of the Company dated February 16, 1999.
GROVE HOLDINGS LLC REPORTS
FIRST QUARTER OPERATING RESULTS
SHADY GROVE, PENNSYLVANIA (FEBRUARY 16, 1999) -- Grove Holdings LLC (the
"Company"), a leading international designer, manufacturer and marketer of a
comprehensive line of mobile hydraulic cranes, aerial work platforms and
truck-mounted cranes, today announced its first quarter of fiscal 1999 operating
results for three months ended January 2, 1999.
Net sales for the first quarter of fiscal 1999 decreased $40.7 million, or
19.9%, from $205.0 million in the first quarter of fiscal 1998 to $164.3 million
in the first quarter of fiscal 1999. The reduction in quarter to quarter net
sales occurred primarily within new equipment sales and resulted from lower unit
demands across the Company. After market sales of parts and services also
reported a decrease in quarter to quarter net sales during the same period. The
after-market sales decline resulted from lower used equipment sales in Europe
during the first quarter of fiscal 1999, and reduced parts sales within North
America during the same period.
Sales backlog, a measure of firm orders for new equipment and replacement parts,
was approximately 28% lower at the end of the first quarter of fiscal 1999 than
it was at the close of the first quarter of fiscal 1998.
The following is a summary of net sales for the periods indicated (dollars in
millions).
Three Months Ended
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December 27, 1997 January 2, 1999
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New equipment sold (1) $158.5 $123.2
After-market 32.5 27.7
Other (2) (3) 14.0 13.4
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Net sales $205.0 $164.3
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(1) Includes new equipment sales of mobile hydraulic cranes, aerial work
platforms and truck-mounted cranes. Excludes specialty cranes and
equipment sold to the U.S. Government.
(2) Includes specialty cranes and equipment sold to the U.S. Government and
revenues from unit sales accounted for as operating leases.
(3) Includes revenues resulting from a non-recurring refurbishment contract
in the first quarter of fiscal 1998 with the Ministry of Defence of the
United Kingdom.
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Gross profit decreased $16.5 million, or 37.8%, from $43.6 million in the first
quarter of fiscal 1998 to $27.1 million in the first quarter of fiscal 1999. The
decrease in gross profit was attributable to a decline in unit sales of new
products and replacement parts and services. Also affecting the first quarter of
fiscal 1999 results were unanticipated costs associated with the U.S. start-up
of the Company's new management information systems, which impacted production
flow and operations visibility.
The closure of the Company's Sunderland facility in November also resulted in a
decrease in first quarter of fiscal 1999 profits. Repositioning the Sunderland
aerial work platform production to the U.S. temporarily affected sales volume.
However, management believes closing the facility will eventually improve
operating earnings, enhance the opportunity for product rationalization savings,
and reduce both manufacturing and selling, engineering, general and
administrative ("SG&A") costs.
SG&A costs for the first quarter of fiscal 1999 decreased $2.1 million, or 6.6
%, from $31.8 million in the first quarter of fiscal 1998 to $29.7 million in
the first quarter of fiscal 1999. The SG&A dollar reduction was primarily
attributable to cost reductions implemented at U.S. facilities in August 1998.
Included in SG&A for first quarter of fiscal 1999 are approximately $2.0 million
of consulting fees paid in connection with the Company's operations improvements
program. As a percentage of sales, SG&A was 15.5% for the first quarter of
fiscal 1998 versus 18.1% of net sales for the first quarter of fiscal 1999. The
percentage increase of SG&A expenses for the first quarter of fiscal 1999 as a
percentage of net sales resulted from lower sales volume.
EBITDA for the first quarter of fiscal 1999 was $0.7 million compared to EBITDA
of $14.0 million for the first quarter of fiscal 1998. Exhibit II, included
herein, restates the EBITDA performance of first quarters fiscal 1999 and 1998
to better illustrate the operational results and take into account certain
non-recurring costs and other items. First quarter of fiscal 1999 EBITDA,
subject to the adjustments set forth in Exhibit II, was $7.5 million versus the
comparable EBITDA of $16.3 million for first quarter of fiscal 1998.
Set forth below is certain information regarding the Company's results of
operations for the quarters ended December 27, 1997 and January 2, 1999 (dollars
in millions).
Three Months Ended
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December 27, 1997 January 2, 1999
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Net sales $205.0 $164.3
Cost of goods sold 161.4 137.2
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Gross profit 43.6 27.1
Selling, engineering, general
and administrative expense 31.8 29.7
Amortization of goodwill 2.3 1.8
Management fees paid to Hanson 0.2 -
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EBIT $ 9.3 $ (4.4)
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As stated previously in connection with the acquisition on April 29, 1998, the
Company was formed as a limited liability company and its capital structure was
changed significantly. Accordingly, comparisons of interest, taxes and net
income for the first fiscal quarter of 1999 relative to the first quarter of
1998 would not be meaningful and are therefore not presented.
Company Chairman and CEO, S.J. Bonanno stated: "Our cost reduction and
operational improvements initiatives are on track in all areas, and we are
excited by our product development efforts and opportunities. Our focus remains
simple: First, to become cost competitive. Secondly, to generate revenue and
market share growth by rapidly developing and commercializing new products, as
well as improving customer support. Finally, we plan to intensify our efforts on
being a global presence; the recently announced establishment of a Grove Europe
management team is our first step towards this objective. Each of these tasks
will not be accomplished overnight, but we continue to make great strides
towards our goals."
The Company's operating businesses include Grove Crane, Grove Manlift and
National Crane with major manufacturing facilities located in the U.S., Germany
and France.
SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
Certain statements above constitute "forward looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Any statements that express, or involve
discussions as to, expectations, beliefs, plans, objectives, assumptions, or
future events or performance (often, but not always, through the use of words or
phrases such as "will likely result", "are expected to", "will continue",
"anticipates", "expects", "estimates", "intends" "plans", "projects" and
"outlook") are not historical facts and may be forward looking. Forward looking
statements involve known and unknown risks, uncertainties, and other factors
that may cause the actual results, levels of activities, cost savings,
performance or achievements of the Company, or industry results to be materially
different from any future results, levels of activity, cost savings, performance
or achievements expressed or implied by such forward looking statements. Such
factors include, among others, the following: i)substantial leverage and the
ability to service debt; ii) changing market trends in the mobile hydraulic
crane, aerial work platform and truck mounted crane industries; iii) general
economic and business conditions including a prolonged or substantial recession;
iv) the ability of the company to implement its business strategy and maintain
and enhance its competitive strengths; v) the ability of the Company to
implement its efficiency and cost savings program; vi) the ability of the
Company to obtain financing for general corporate purposes; vii) competition;
viii) availability of key personnel; ix) industry over capacity; and x) changes
in, or failure to comply with government regulations. As a result of the
foregoing and other factors, no assurance can be given as to future results,
levels of activity or achievements, and neither the Company nor any other person
assumes responsibility for the accuracy and completeness of these forward
looking statements. Any forward looking statement contained above speak solely
as of the date on which such statements are made, and the Company undertakes no
obligation to update any forward looking statements to reflect events or
circumstances after the date on which such statements were made or to reflect
the occurrence of unanticipated events.
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GROVE HOLDINGS LLC
EXHIBIT I
(IN THOUSANDS)
(UNAUDITED)
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Three months ended
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December 27, January 2,
1997 1999
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Net sales $ 204,958 $ 164,325
Cost of goods sold 161,386 137,242
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Gross profit 43,572 27,083
Selling, engineering, general, and
administrative expense 31,989 29,696
Amortization of goodwill 2,260 1,823
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Earnings before interest and taxes (EBIT) 9,323 (4,436)
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Interest income/(expense) 1,095 (10,532)
Other income/(expense) 35 (41)
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Income before income taxes 10,453 (15,009)
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Other data
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Capital expenditures 9,629 950
Cash interest expense incurred 522 10,367
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<PAGE>
GROVE HOLDINGS LLC
EXHIBIT II
(IN THOUSANDS)
(UNAUDITED)
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Three months ended
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December 27, January 2,
1997 1999
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EBIT $ 9,323 $ (4,436)
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Depreciation & Amortization 4,694 5,181
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EBITDA 14,017 745
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Adjustments
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Impact of units sold accounted as operating
leases 399 1,207
Expenses associated with MIS installation 142
Restructuring charges/Management fees 162
Sunderland (Gains)/Losses 1,556 3,554
George Group expenses 1,990
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TOTAL 16,276 7,496
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