Delaware (State or other jurisdiction of incorporation) | 333-05978 (Commission File Number) | 58-2502320 (I.R.S. Employer Identification Number) |
303 Research Drive, Suite 400 Norcross, GA 30092 (Address of principal executive offices, including zip code) |
Exhibit No. | Description | |
99.1 | Press Release of Euramax Holdings, Inc. dated August 8, 2014, reporting Euramax Holdings, Inc.'s financial results for the second quarter 2014. |
EURAMAX HOLDINGS, INC. | |||
Date: August 8, 2014 | By: | /s/ Mary S. Cullin | |
Name: Mary S. Cullin | |||
Title: Senior Vice President, Chief Financial Officer and Treasurer | |||
• | Net sales increased $3.1 million, or 1.3%, to $233.0 million in the second quarter of 2014 compared to $229.9 million in the second quarter of 2013. The strengthening of the euro and British pound sterling against the U.S. dollar resulted in an approximate $4.1 million increase in net sales during the quarter. Excluding the impact of foreign currency fluctuations net sales declined $1.0 million over the prior year quarter. Demand in the Company's European segments declined for architectural and industrial projects and for holiday homes in the United Kingdom. These declines were partially offset by higher demand from OEMs in the RV and transportation markets. Net sales in the Company's U.S. segments improved $3.3 million, or 2.1%, compared to the second quarter of 2013 primarily driven by higher demand in the Commercial Products segment. The Company believes net sales in the post frame construction markets benefited from the release of pent up demand due to the extreme weather conditions in the first quarter of 2014. Net sales in the RV and transportation markets also improved compared to the second quarter of 2013. Net sales for the U.S. Residential Products segment remained relatively flat over the prior year quarter as higher demand in the Company's distribution markets and for the Company's vinyl window and patio offerings were generally offset by lower net sales in the home center markets. |
• | Income from operations increased $0.2 million to $10.1 million in the second quarter of 2014 compared to $9.9 million for the second quarter of 2013. Income from operations for the second quarter of 2014 improved despite being negatively impacted by $2.3 million of other operating charges primarily related to workforce rationalization in North America, professional consulting fees associated with the Company's executive transition period and operational improvement initiatives, and the impact of ongoing initiatives in the Company's European segments. In the second quarter of 2013, other operating charges totaled approximately $1.1 million. Excluding the impact of other operating charges, income from operations improved $1.4 million in the second quarter of 2014 compared to the second quarter of 2013. Among other factors, this improvement in income from operations was the result of higher demand in the Company's Commercial Products segment and lower operating costs due to the successful implementation of operating initiatives in our European business. |
• | Adjusted EBITDA is a significant operating measure used by the Company to measure its operating performance and liquidity. Adjusted EBITDA was $21.0 million in the second quarter of 2014 compared to $20.8 million in the second quarter of 2013, an increase of $0.2 million, or 1.0%. |
June 27, 2014 | December 31, 2013 | ||||||
ASSETS | (unaudited) | ||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 2,527 | $ | 8,977 | |||
Accounts receivable, less allowances of $2,083 and $2,235, respectively | 111,174 | 73,996 | |||||
Inventories, net | 113,378 | 89,760 | |||||
Income taxes receivable | 459 | 982 | |||||
Deferred income taxes | 576 | 580 | |||||
Other current assets | 7,208 | 7,008 | |||||
Total current assets | 235,322 | 181,303 | |||||
Property, plant and equipment, net | 123,559 | 130,114 | |||||
Goodwill | 203,667 | 204,053 | |||||
Customer relationships, net | 34,033 | 40,631 | |||||
Other intangible assets, net | 6,754 | 7,073 | |||||
Deferred income taxes | 304 | 87 | |||||
Other assets | 7,311 | 8,712 | |||||
Total assets | $ | 610,950 | $ | 571,973 | |||
LIABILITIES AND SHAREHOLDERS’ DEFICIT | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 90,371 | $ | 57,262 | |||
Accrued expenses and other current liabilities | 29,586 | 26,366 | |||||
Accrued interest payable | 12,919 | 9,020 | |||||
Current portion of long-term debt | 4,361 | — | |||||
Deferred income taxes | 601 | 605 | |||||
Total current liabilities | 137,838 | 93,253 | |||||
Long-term debt | 551,922 | 535,396 | |||||
Deferred income taxes | 19,136 | 18,980 | |||||
Other liabilities | 33,173 | 32,907 | |||||
Total liabilities | 742,069 | 680,536 | |||||
Shareholders’ deficit: | |||||||
Common stock | 195 | 195 | |||||
Additional paid-in capital | 724,316 | 724,071 | |||||
Accumulated loss | (866,138 | ) | (843,750 | ) | |||
Accumulated other comprehensive income | 10,508 | 10,921 | |||||
Total shareholders’ deficit | (131,119 | ) | (108,563 | ) | |||
Total liabilities and shareholders’ deficit | $ | 610,950 | $ | 571,973 |
Three months ended | Six months ended | ||||||||||||||
June 27, 2014 | June 28, 2013 | June 27, 2014 | June 28, 2013 | ||||||||||||
Net sales | $ | 232,990 | $ | 229,861 | $ | 402,894 | $ | 402,406 | |||||||
Costs and expenses: | |||||||||||||||
Cost of goods sold (excluding depreciation and amortization) | 193,077 | 190,461 | 340,048 | 339,631 | |||||||||||
Selling and general (excluding depreciation and amortization) | 19,190 | 19,940 | 37,966 | 39,380 | |||||||||||
Depreciation and amortization | 8,251 | 8,450 | 16,453 | 17,043 | |||||||||||
Other operating charges | 2,341 | 1,126 | 3,306 | 3,900 | |||||||||||
Income from operations | 10,131 | 9,884 | 5,121 | 2,452 | |||||||||||
Interest expense | (13,914 | ) | (13,854 | ) | (27,679 | ) | (27,452 | ) | |||||||
Other (loss) income, net | (516 | ) | 2,111 | (320 | ) | (4,234 | ) | ||||||||
Loss before income taxes | (4,299 | ) | (1,859 | ) | (22,878 | ) | (29,234 | ) | |||||||
(Benefit from) provision for income taxes | (1,183 | ) | (303 | ) | (490 | ) | 438 | ||||||||
Net loss | $ | (3,116 | ) | $ | (1,556 | ) | $ | (22,388 | ) | $ | (29,672 | ) |
Six months ended | |||||||
June 27, 2014 | June 28, 2013 | ||||||
Net cash used in operating activities | $ | (25,140 | ) | $ | (33,383 | ) | |
Cash flows from investing activities: | |||||||
Proceeds from sales of assets | 66 | 2,186 | |||||
Capital expenditures | (2,961 | ) | (4,958 | ) | |||
Net cash used in investing activities | (2,895 | ) | (2,772 | ) | |||
Cash flows from financing activities: | |||||||
Net borrowings on ABL Credit Facility | 16,260 | 22,953 | |||||
Net borrowings on Dutch Revolving Credit Facility | 4,361 | 3,333 | |||||
Changes in cash overdrafts | 1,326 | 5,144 | |||||
Debt issuance costs | (88 | ) | (175 | ) | |||
Net cash provided by financing activities | 21,859 | 31,255 | |||||
Effect of exchange rate changes on cash | (274 | ) | (23 | ) | |||
Net decrease in cash and cash equivalents | (6,450 | ) | (4,923 | ) | |||
Cash and cash equivalents at beginning of period | 8,977 | 10,024 | |||||
Cash and cash equivalents at end of period | $ | 2,527 | $ | 5,101 |
Three months ended | Six months ended | ||||||||||||||
June 27, 2014 | June 28, 2013 | June 27, 2014 | June 28, 2013 | ||||||||||||
Net loss | $ | (3,116 | ) | $ | (1,556 | ) | $ | (22,388 | ) | $ | (29,672 | ) | |||
Add: | |||||||||||||||
Interest expense | 13,914 | 13,854 | 27,679 | 27,452 | |||||||||||
Depreciation and amortization | 8,251 | 8,450 | 16,453 | 17,043 | |||||||||||
(Benefit from) provision for income taxes | (1,183 | ) | (303 | ) | (490 | ) | 438 | ||||||||
Adjustments: | |||||||||||||||
Other loss (income), net (a) | 516 | (2,111 | ) | 320 | 4,234 | ||||||||||
Plant closure, severance, relocation and one-time compensation costs | 1,793 | 1,447 | 2,557 | 2,960 | |||||||||||
Non-recurring executive consulting | 704 | — | 926 | — | |||||||||||
Stock compensation expense | 124 | 794 | 245 | 1,562 | |||||||||||
Non-recurring consulting, legal and professional fees | 9 | 28 | 149 | 43 | |||||||||||
Long term incentive plan | — | 172 | — | 487 | |||||||||||
Loss on asset held for sale | — | — | — | 1,594 | |||||||||||
Adjusted EBITDA | $ | 21,012 | $ | 20,775 | $ | 25,451 | $ | 26,141 |
(a) | Other loss, net for the three months ended June 27, 2014 is primarily comprised of translation losses on intercompany obligations of approximately $0.6 million, offset by gains of $0.1 million on forward foreign currency contracts. Other income, net for the three months ended June 28, 2013 included translation gains on intercompany obligations of approximately $2.2 million, which were partially offset by losses of $0.1 million on forward foreign currency contracts. |