/EINPresswire.com/ -- DELAND, FL --(Marketwired - February 09, 2016) - ARC Group Worldwide, Inc. ("ARC" and the "Company") (NASDAQ: ARCW), a leading global provider of advanced manufacturing and 3D printing solutions, today reported its second quarter fiscal year 2016 (December 27, 2015) results.

Highlights for the quarter ended December 27, 2015, compared sequentially to the quarter ended September 27, 2015:

• Sales of $25.0 million, an increase of 2.2%; and
• Adjusted EBITDA of $2.9 million, an increase of 8.4%.

Second Quarter Results

Second fiscal quarter 2016 revenue was $25.0 million, a 2.2% increase sequentially, compared to the first fiscal quarter of 2016. The increase was due to early stages of momentum in several key market segments served by the Company, along with record metal 3D printing revenue. Adjusted EBITDA for the second fiscal quarter was $2.9 million, an 8.4% increase sequentially, compared to the first fiscal quarter of 2016. Adjusted EBITDA Margin increased to 11.5%, from 10.8% in the prior sequential quarter, reflecting greater operational efficiencies.

ARC Mexico

ARC has launched a new initiative in Mexico, which is expected to begin operations in the next several months. ARC Mexico should help the Company be more competitive in winning new North American business and improving margins.

Jason Young, Chairman and CEO, commented, "While we are encouraged by the positive sequential performance, we are still in the early stages of building momentum in sales. We remain focused on improving speed to market for our customers and helping them consolidate their supply chain with our holistic solution. Under our new sales leadership and focus, we believe we are making good progress educating our customers about our differentiated solution and expect to get continued traction over time. We are also encouraged by the growing demand for our metal 3D printing services, which we expect to be a major growth driver in the future."

GAAP to Non-GAAP Reconciliation

EBITDA, EBITDA Margin, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Earnings and Adjusted Earnings Per Share are non-GAAP financial measures. EBITDA Margin and Adjusted EBITDA Margin are calculated by dividing EBITDA and Adjusted EBITDA, respectively, by sales. The Company has provided non-GAAP financial information to provide additional, meaningful comparisons of current results to prior periods' results by excluding items that the Company does not believe reflect its fundamental business performance and are not representative or indicative of its results of operations. Non-GAAP financial measures are not in accordance with, or an alternative for, generally accepted accounting principles in the United States. The Company's non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures, and should be read only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP.

The reconciliation to GAAP is as follows (dollars in thousands):

                                                                             
For the three months       December    September       June       December      
 ended:                    27, 2015     27, 2015     30, 2015     28, 2014     
------------------------ ------------ ------------ ------------ ------------
Net loss                 $      (594) $      (441) $      (666) $        (2)
  Interest Expense, Net        1,126        1,141        1,248        1,213 
  Income Taxes                  (132)        (426)       1,158          237 
  Depreciation and                                                          
   Amortization                2,388        2,362        2,402        2,355 
                         ------------ ------------ ------------ ------------
EBITDA                   $     2,788   $    2,636        4,142   $    3,803 
EBITDA Margin                   11.1%        10.8%        14.4%        14.0%
  Merger Expenses                  -            -            -           11 
  Reorganization                                                            
   Expenses                       90            9            -            - 
                         ------------ ------------ ------------ ------------
Adjusted EBITDA          $     2,878   $    2,645   $    4,142        3,814 
Adjusted EBITDA Margin          11.5%        10.8%        14.4% $      14.1%
                                                                            
Net loss                 $      (594) $      (441) $      (666) $        (2)
  Merger Expenses                  -            -            -           11 
  Reorganization                                                            
   Expenses                       90            9            -            - 
                         ------------ ------------ ------------ ------------
Adjusted Earnings        $      (504) $      (432) $      (666) $         9 
Adjusted Earnings Per                                                       
 Share                   $     (0.03) $     (0.02) $     (0.04) $         - 
Weighted Average Common                                                     
 Shares Outstanding       18,123,883   18,123,883   17,752,915   14,673,205 
                                                                            

EBITDA excludes interest expense, net and income taxes because these items are associated with our capitalization and tax structures. EBITDA also excludes depreciation and amortization expense because these non-cash expenses reflect the impact of prior capital expenditure decisions which may not be indicative of future capital expenditure requirements.

The Company defines Adjusted EBITDA as EBITDA plus merger expenses, other non-recurring expenses and reorganization expenses. Merger expenses are costs incurred to effectuate our acquisitions, such as advisory, legal and accounting fees. Other non-recurring expenses consist primarily of accounting and legal fees associated with our acquisitions and financing activities. Reorganization expenses are primarily labor and labor related costs associated with the termination of employees.

Adjusted Earnings removes the impact of merger expenses and reorganization expenses.

About ARC Group Worldwide, Inc.

ARC Group Worldwide, Inc., is a leading global advanced manufacturing and 3D printing service provider. The Company offers its customers a compelling portfolio of advanced manufacturing technologies and cutting-edge capabilities to improve the efficiency of traditional manufacturing processes and accelerate their time to market. In addition to being a world leader in metal injection molding, ARC has significant expertise in plastic and metal 3D printing, precision stamping, traditional and clean room plastic injection molding, advanced rapid tooling, thixomolding, lean manufacturing, antennas, hermetic seals, robotics, and flanges and forges.

Forward Looking Statements

This press release may contain "forward-looking" statements as defined in the Private Securities Litigation Reform Act of 1995, which are based on ARC's current expectations, estimates and projections about future events. These include, but are not limited to, statements, if any, regarding business plans, pro-forma statements and financial projections, ARC's ability to expand its services and realize growth. These statements are not historical facts or guarantees of future performance, events or results. Such statements involve potential risks and uncertainties, and the general effects of financial, economic, and regulatory conditions affecting our industries. Accordingly, actual results may differ materially. ARC does not have any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. For further information on risks and uncertainties that could affect ARC's business, financial condition and results of operations, readers are encouraged to review Item 1A. - Risk Factors and all other disclosures appearing in ARC's Form 10-K for the fiscal year ended June 30, 2015 and Form 10-Q for the period ended September 27, 2015 as well as current reports on Form 8-K filed from time-to-time with the Securities and Exchange Commission.

                                                                            
                         ARC Group Worldwide, Inc.                          
         Unaudited Condensed Consolidated Statements of Operations          
          (in thousands, except for share and per share amounts)            
                                                                            
                               For the three             For the six                      
                                months ended             months ended 
                         ------------------------- -------------------------
                           December     December     December     December  
                           27, 2015     28, 2014     27, 2015     28, 2014  
                         ------------ ------------ ------------ ------------
Sales                    $    25,028  $    27,106  $    49,517  $    55,804 
Cost of sales                 20,407       20,719       40,412       42,434 
                         ------------ ------------ ------------ ------------
Gross profit                   4,621        6,387        9,105       13,370 
  Selling, general and                                                      
   administrative              4,312        4,919        8,525       10,418 
  Merger expense                   -           11            -          187 
                         ------------ ------------ ------------ ------------
Income from operations           309        1,457          580        2,765 
  Other income (expense),                                                   
   net                            91           (9)          94          (11)
  Interest expense, net       (1,126)      (1,213)      (2,267)      (2,134)
                         ------------ ------------ ------------ ------------
(Loss) income before                                                        
 income taxes                   (726)         235       (1,593)         620 
  Income tax benefit                                                        
   (expense)                     132         (237)         558         (390)
                         ------------ ------------ ------------ ------------
Net (loss) income               (594)          (2)      (1,035)         230 
Less: Net income                                                            
 attributable to non-                                                       
 controlling interest            (35)         (58)         (64)        (114)
                         ------------ ------------ ------------ ------------
Net (loss) income                                                           
 attributable to ARC                                                        
 Group Worldwide, Inc.   $      (629) $       (60) $    (1,099) $       116 
                         ============ ============ ============ ============
Net (loss) income per                                                       
 common share:                                                              
  Basic and diluted      $     (0.03) $         -  $     (0.06) $      0.01 
                         ============ ============ ============ ============
                                                                            
Weighted average common                                                     
 shares outstanding:                                                        
  Basic and diluted       18,123,883   14,673,205   18,123,883   14,673,205 
                         ============ ============ ============ ============
                                                                            

                                                                            
                         ARC Group Worldwide, Inc.                          
              Unaudited Condensed Consolidated Balance Sheets               
          (in thousands, except for share and per share amounts)            
                                                                            
                                                December 27,      June 30,           
                                                   2015            2015 
                                               -------------- --------------
ASSETS                                                                      
Current assets:                                                             
  Cash                                         $       3,867  $       4,821 
  Accounts receivable, net                            14,214         15,385 
  Inventories, net                                    15,274         16,386 
  Deferred income tax assets                             847            672 
  Prepaid expenses and other current assets            4,809          2,330 
                                               -------------- --------------
Total current assets                                  39,011         39,594 
Property and equipment, net                           42,035         43,813 
Goodwill                                              14,801         14,801 
Intangible assets, net                                24,754         26,441 
Other                                                  1,160          1,374 
                                               -------------- --------------
Total assets                                   $     121,761  $     126,023 
                                               ============== ==============
                                                                            
LIABILITIES AND STOCKHOLDERS' EQUITY                                        
Current liabilities:                                                        
  Accounts payable                             $       6,827  $       7,338 
  Accrued expenses                                     2,407          3,026 
  Deferred revenue                                       949            991 
  Bank borrowings, current portion of long-                                 
   term debt                                           6,700          5,995 
  Capital lease obligations, current portion             879            857 
  Accrued escrow obligations, current portion          2,842          4,291 
                                               -------------- --------------
Total current liabilities                             20,604         22,498 
Long-term debt, net of current portion                49,444         51,971 
Deferred income tax liabilities                        2,577          2,029 
Capital lease obligations, net of current                                   
 portion                                               2,369          2,784 
Accrued escrow obligations, net of current                                  
 portion                                               1,208              - 
Other long-term liabilities                               73              - 
                                               -------------- --------------
Total liabilities                                     76,275         79,282 
                                                                            
Commitments and contingencies                                               
Equity:                                                                     
  Preferred stock, $0.001 par value, 2,000,000                              
   shares authorized, no shares issued and                                  
   outstanding                                             -              - 
  Common stock, $0.0005 par value, 250,000,000                              
   shares authorized; 19,037,698 shares issued                              
   and 19,029,297 shares issued and                                         
   outstanding at December 27, 2015, and                                    
   18,538,522 shares issued and 18,530,121                                  
   shares issued and outstanding at June 30,                                
   2015                                                    5              5 
  Treasury stock, at cost; 8,401 shares at                                  
   December 27, 2015 and June 30, 2015                   (94)           (94)
  Additional paid-in capital                          29,631         29,751 
  Retained earnings                                   14,832         15,931 
  Accumulated other comprehensive loss                   (56)           (58)
                                               -------------- --------------
  Total ARC Group Worldwide, Inc.                                           
   stockholders' equity                               44,318         45,535 
  Non-controlling interests                            1,168          1,206 
                                               -------------- --------------
  Total equity                                        45,486         46,741 
                                               -------------- --------------
Total liabilities and equity                   $     121,761  $     126,023 
                                               ============== ==============
                                                                            

                                                                            
                         ARC Group Worldwide, Inc.                          
         Unaudited Condensed Consolidated Statements of Cash Flows          
                              (in thousands)                                
                                                                            
                                                 For the six months ended   
                                               -----------------------------
                                                December 27,   December 28, 
                                                   2015           2014      
                                               -------------- --------------
Cash flows from operating activities:                                       
Net (loss) income                              $      (1,035) $         230 
Adjustments to reconcile net (loss) income to                               
 net cash provided by (used in) operating                                   
 activities:                                                                
  Depreciation and amortization                        4,750          4,666 
  Bad debt expense and other                              69            (56)
  Deferred income taxes                                  374             12 
Changes in working capital:                                                 
  Accounts receivable                                  1,157           (309)
  Inventory                                            1,111         (1,200)
  Prepaid expenses and other assets                   (2,265)        (1,502)
  Accounts payable                                      (560)        (2,944)
  Accrued expenses                                      (960)           604 
  Deferred revenue                                       (43)           274 
                                               -------------- --------------
Net cash provided by (used in) operating                                    
 activities                                            2,598           (225)
                                               -------------- --------------
                                                                            
Cash flows from investing activities:                                       
  Purchases of property and equipment                 (1,339)        (3,446)
                                               -------------- --------------
Net cash used in investing activities                 (1,339)        (3,446)
                                               -------------- --------------
                                                                            
Cash flows from financing activities:                                       
  Proceeds from debt issuance                          1,000         23,500 
  Repayments of long-term debt and capital                                  
   lease obligations                                  (3,215)       (25,216)
  Stock issuance costs                                     -           (138)
                                               -------------- --------------
Net cash used in financing activities                 (2,215)        (1,854)
                                               -------------- --------------
  Effect of exchange rates on cash                         2              - 
                                               -------------- --------------
Net decrease in cash                                    (954)        (5,525)
Cash, beginning of period                              4,821          9,384 
                                               -------------- --------------
Cash, end of period                            $       3,867  $       3,859 
                                               ============== ==============
Supplemental disclosures of cash flow                                       
 information:                                                               
  Cash paid for interest                       $       1,474  $       1,587 
  Cash paid for income taxes                   $         514  $          20 
                                                                            

Drew M. Kelley
PHONE: (303) 467-5236
Email: InvestorRelations@ArcGroupWorldwide.com