First Quarter Conference Call – Fiscal 2006
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Our depreciation was $8.8 million in the quarter. Amortization of intangibles and other items were $2.0 million in the quarter. Other non-cash opening balance sheet amortizations like inventory step-ups were $200,000. Another non-cash item is our 123R expense. For the whole year, this should amount to $3.5 million, including the $2.0 million we expensed in the first quarter. These are the pre-tax numbers. The after-tax costs will be $2.8 million for the year and were $1.4 million in Q1.
Loss reserve balances went up from $14.1 million at 9/30/05 to $16.0 million at 12/31/05. Programs like Hawker 4000 and the A380 that Bob discussed all added to that accrual on our balance sheet.
Our interest expense went up by $2.9 million in the quarter compared to last year’s first quarter. About $1.2 million relates to funds borrowed for the Kaydon and Flo-Tork acquisitions. Another $1.4 million relates to higher rates on our high-yield bonds. For all of ‘06, we estimate interest expense should be $21 million.
Our tax rate for the next three quarters is estimated to average 31% and the entire year should work out to 33% given the high rate with the write off we had in this quarter.
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