SIFCO Industries, Inc. (NYSE Amex: SIF) today announced financial results for its fiscal 2012 second quarter, which ended March 31, 2012.

Second quarter

• Net sales increased 27.1% in the second quarter of fiscal 2012 to $34.1 million, compared with $26.8 million in the comparable period in fiscal 2011.
• Net income for the second quarter of fiscal 2012 was $1.7 million, or $0.32 per diluted share, compared with a net income of $2.0 million, or $0.38 per diluted share for the comparable fiscal 2011 period.
• EBITDA in the second quarter of fiscal 2012 was $4.4 million, or 13.0% of net sales, compared with $4.4 million, or 16.5% of net sales, in the comparable period in fiscal 2011.
• Adjusted EBITDA in the second quarter of fiscal 2012 was $5.3 million, or 15.7% of net sales, compared with $4.9 million, or 18.1% of net sales, in the comparable period in fiscal 2011.

First six months

• Net sales increased 29.9% in the first six months of fiscal 2012 to $62.6 million, compared with $48.2 million in the comparable period in fiscal 2011.
• Net income for the first six months of fiscal 2012 was $2.9 million, or $0.55 per diluted share, compared with net income of $3.2 million, or $0.60 per diluted share, for the comparable fiscal 2011 period.
• EBITDA in the first six months of fiscal 2012 was $7.9 million, or 12.6% of net sales, compared with $6.9 million, or 14.3% of net sales, in the comparable period in fiscal 2011.
• Adjusted EBITDA in the first six months of fiscal 2012 was $9.6 million, or 15.3% of net sales, compared with $7.7 million, or 15.9% of net sales, in the comparable period in fiscal 2011.

The results for fiscal 2012 include the results of Quality Aluminum Forge, which was acquired on October 28, 2011.

Non-GAAP Supplemental Information

Neither EBITDA nor Adjusted EBITDA is a measurement of financial performance under accounting principles generally accepted in the United States of America (“GAAP”). EBITDA and Adjusted EBITDA are presented in this press release as supplemental disclosures to net income and reported results. References to “EBITDA” mean earnings before interest, taxes, depreciation and amortization, and references to “Adjusted EBITDA” mean EBITDA plus, as applicable for each relevant period, certain adjustments as set forth in the reconciliations of net income to EBITDA and Adjusted EBITDA.

The Company presents EBITDA and Adjusted EBITDA because (i) it believes they are useful indicators for evaluating operating performance and liquidity, including the Company's ability to incur and service debt and (ii) it uses EBITDA to evaluate prospective acquisitions. Although the Company uses EBITDA and Adjusted EBITDA for the reasons noted, the use of these non-GAAP financial measures as analytical tools has limitations and, therefore, reviewers of the Company’s financial information should not consider them in isolation, or as a substitute for analysis of its results of operations as reported in accordance with GAAP. Some of these limitations are:

• Neither EBITDA nor Adjusted EBITDA reflects the interest expense, or the cash requirements necessary to service interest payments, on indebtedness;
• Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and neither EBITDA nor Adjusted EBITDA reflects any cash requirements for such replacements;
• The omission of the substantial amortization expense associated with the Company’s intangible assets further limits the usefulness of EBITDA and Adjusted EBITDA;
• Neither EBITDA nor Adjusted EBITDA includes the payment of taxes, which is a necessary element of operations; and
• Adjusted EBITDA excludes the cash expense the Company has incurred to acquire businesses.

Because of these limitations, EBITDA and Adjusted EBITDA should not be considered as measures of discretionary cash available to the Company to invest in the growth of its businesses. Management compensates for these limitations by not viewing EBITDA or Adjusted EBITDA in isolation and specifically by using other GAAP measures, such as net income, net sales and operating profit, to measure operating performance. Neither EBITDA nor Adjusted EBITDA is a measurement of financial performance under GAAP, and neither should be considered as an alternative to net income or cash flow from operations determined in accordance with GAAP. The Company’s calculation of EBITDA and Adjusted EBITDA may not be comparable to the calculation of similarly titled measures reported by other companies.

Forward-Looking Language

Certain statements contained in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to financial results and plans for future business development activities, and are thus prospective. Such forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions, competition and other uncertainties detailed from time to time in the Company’s Securities and Exchange Commission filings.

The Company’s Form 10-Q for the quarter ended March 31, 2012 can be accessed through its website: www.sifco.com, or on the Securities and Exchange Commission’s website: www.sec.gov.

SIFCO Industries, Inc. is engaged in the production and sale of a variety of metalworking processes, services and products produced primarily to the specific design requirements of its customers. The processes and services include both conventional and precision forging, heat-treating, coating, welding, machining and selective plating. The products include both conventional and precision forged components, machined forged parts and other machined metal components, remanufactured component parts for aerospace turbine engines, and selective plating solutions and equipment. The Company’s operations are conducted in three business segments: (1) Forged Components Group, (2) Turbine Components Services and Repair Group, and (3) Applied Surface Concepts Group.