0001287151-16-000200.txt : 20160719 0001287151-16-000200.hdr.sgml : 20160719 20160719094036 ACCESSION NUMBER: 0001287151-16-000200 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20160718 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20160719 DATE AS OF CHANGE: 20160719 FILER: COMPANY DATA: COMPANY CONFORMED NAME: XERIUM TECHNOLOGIES INC CENTRAL INDEX KEY: 0001287151 STANDARD INDUSTRIAL CLASSIFICATION: BROADWOVEN FABRIC MILS, MAN MADE FIBER & SILK [2221] IRS NUMBER: 421558674 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-32498 FILM NUMBER: 161772560 BUSINESS ADDRESS: STREET 1: 14101 CAPITAL BOULEVARD CITY: YOUNGSVILLE STATE: NC ZIP: 27596 BUSINESS PHONE: 919-526-1400 MAIL ADDRESS: STREET 1: 14101 CAPITAL BOULEVARD CITY: YOUNGSVILLE STATE: NC ZIP: 27596 8-K 1 q22016flash8-k.htm 8-K Document


UNITED STATES
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

July 18, 2016
Date of Report (Date of earliest event reported)
XERIUM TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)

Delaware
001-32498
42-1558674
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification Number)

14101 Capital Boulevard, Youngsville, NC 27596
(Address of principal executive offices)

(919) 526-1400
(Registrant's telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))




Item 2.02 Results of Operations and Financial Condition.

On July 18, 2016, Xerium Technologies, Inc. (the "Company") issued a press release setting forth preliminary financial results for the quarter ended June 30, 2016. A copy of the press release is furnished with this Current Report on Form 8-K as Exhibit 99.1.

Item 7.01 Regulation FD Disclosure.

On July 18, 2016, the Company announced its intention to offer, subject to market and other conditions, $475 million aggregate principal amount of senior secured notes due 2021. The Company intends to use the net proceeds from the offering to repay all amounts outstanding under its existing term loan credit facility, to redeem all of its 8.875% Senior Notes due 2018 and to pay premiums, fees and expenses in connection therewith. A copy of the press release is furnished with this Current Report on Form 8-K as Exhibit 99.2.
The information in this Current Report on Form 8-K, including the exhibits attached hereto, are furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section, and shall not be deemed incorporated by reference into any filing under the Exchange Act or the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01
Financial Statements and Exhibits.

(d) Exhibits

Exhibit No.
 
Description
99.1
 
Press release of Xerium Technologies, Inc. dated July 18, 2016.
99.2
 
Press release of Xerium Technologies, Inc. dated July 18, 2016.

SIGNATURES

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.
 
XERIUM TECHNOLOGIES, INC.
 
 
 
 
 
 
By
/s/ Clifford E. Pietrafitta
 
 
Name:
Clifford E. Pietrafitta

 
 
Title:
Executive Vice President and Chief Financial Officer

 

Date:  July 19, 2016


 EX-99.1 2 q22016prelimrelease.htm EXHIBIT 99.1 Exhibit

Xerium Announces Preliminary Second Quarter 2016 Results and Confirms Guidance for 2016
YOUNGSVILLE, N.C.--(BUSINESS WIRE)—July 18, 2016-- Xerium Technologies, Inc. (NYSE:XRM) a leading global provider of industrial consumable products and services, today announced selected preliminary financial results for the quarter ended June 30, 2016.
 
2016 Second Quarter
Preliminary Results
 
Last Twelve Months
Preliminary Results
 
Net Sales
$
124.0

million
$
472.0

million
Adjusted EBITDA
$
27.6

million
$
101.1

million
Adjusted EBITDA as % of Sales
22.3

%
21.4

%
Net Income
$
1.6

million
$
(5.2
)
million
Net Income as a % of Sales
1.3

%
(1.1
)
%
Net Debt
$
499.5

million
$
499.5

million
Net Leverage Ratio
   4.9x

 
   4.9x

 
Pro-forma Net Leverage Ratio
4.7x

 
4.7x

 
Xerium’s preliminary results for the 2016 second quarter include:
* See “Non-GAAP Financial Measures” below.
SECOND QUARTER HIGHLIGHTS
•
Q2 2016 sales were $124.0 million - an increase year-over-year of $0.5 million (0.4%), and a sequential increase of $7.0 million (6.1%), on a constant currency basis. The Company’s markets are stable and the Company is benefiting from its sales repositioning investments into growth markets and the Q2 acquisition of JJ Plank.
•
Q2 2016 Adjusted EBITDA was $27.6 million – a sequential increase of $3.6 million (15%) and year-over-year decrease of $0.4 million (1.4%). Sales volumes have recovered as the company’s repositioning efforts are offsetting graphical market declines. Adjusted EBITDA is on track for full year guidance.
•
Q2 2016 free cash flow was $0.6 million – strong operating cash flow was used to pay $10.7 million Q2 bond interest payment and strategic capex. Year-to-date free cash flow is approximately $11 million and on track for full year guidance.
•
Q2 acquisition of JJ Plank added capability to rolls business, and is immediately deleveraging on a pro forma basis.
•
The Company’s net leverage ratio on a pro forma basis remained steady at 4.7x compared to March 31, 2016.
Harold Bevis, Xerium's President and Chief Executive Officer stated, "We are pleased that our preliminary second quarter results show progress, consistent with the repositioning efforts that we have implemented. Increased sales and wins during the quarter offset the continued decline in the graphical grades market. We are continuing to generate positive free cash flow, utilizing this to pay down debt and make strategic capital investments.”



PRELIMINARY RESULTS
The results provided in this press release are preliminary and subject to completion and review of Xerium’s 2016 second quarter financial statements in conjunction with the Company’s 2016 second quarter Form 10-Q filing, and therefore they are subject to change.
Xerium intends to report final results for the 2016 second quarter on or about August 2, 2016, after market close. Xerium’s earnings press release and prepared remarks reviewing its financial results and guidance will be made available on the Investor Relations section of its website at www.xerium.com.
ABOUT XERIUM TECHNOLOGIES
Xerium Technologies, Inc. (NYSE:XRM) is a leading global provider of industrial consumable products and services. Xerium, which operates around the world under a variety of brand names, utilizes a broad portfolio of patented and proprietary technologies to provide customers with tailored solutions and products integral to production, all designed to optimize performance and reduce operational costs. With 30 manufacturing facilities in 13 countries around the world, Xerium has approximately 3,000 employees.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements. The words "will", "believe," "estimate," "expect," "intend," "anticipate," "goals," variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. The forward-looking statements in this release include statements regarding our full year EBITDA and Adjusted EBITDA performance, anticipated sales performance, capital expenditures, cost savings measures, future efforts to improve overall performance and free cash flow. Forward-looking statements are not guarantees of future performance, and actual results may vary materially from the results expressed or implied in such statements. Differences may result from actions taken by us, as well as from risks and uncertainties beyond our control. These risks and uncertainties include the following items: (1) we may not realize the EBITDA and Adjusted EBITDA performance we are projecting (2) our expected sales performance and our backlog of sales may not be fully realized; (3) our cost reduction efforts, including our restructuring activities, may not have the positive impacts we anticipate; (4) we are subject to execution risk related to the startup of our new facilities in China and Turkey and expansion projects elsewhere; (5) our plans to develop and market new products, enhance operational efficiencies and reduce costs may not be successful; (6) market improvement in our industry may occur more slowly than we anticipate, may stall or may not occur at all; (7) variations in demand for our products, including our new products, could negatively affect our revenues and profitability; (8) our manufacturing facilities may be required to quickly increase or decrease production, which could negatively affect our production facilities, customer order lead time, product quality, labor relations or gross margin; and (9) the other risks and uncertainties discussed elsewhere in this press release, our Form 10-K for the year ended December 31, 2015 filed on March 14, 2016 and our other SEC filings. If any of these risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may vary significantly from what we projected. Any forward-looking statement in this press release reflects our current views with respect to future events. Except as required by law, we assume no



obligation to publicly update or revise these forward-looking statements for any reason, whether as a result of new information, future events, or otherwise. As discussed above, we are subject to substantial risks and uncertainties related to current economic conditions, and we encourage investors to refer to our SEC filings for additional information. Copies of these filings are available from the SEC and in the investor relations section of our website at www.xerium.com.
NON-GAAP FINANCIAL MEASURES
Adjusted EBITDA (in thousands)
Three Months Ended
Trailing 12 Months
 
June 30,
June 30,
 
2,016
2,016
Net income (loss)
$
1,623

 $ (5,233)
Stock-based compensation
834

                        3,098
Depreciation
8,182

                      30,775
Amortization of intangibles
210

                           444
Curtailment settlement loss
—

                        1,108
Deferred financing cost amortization
785

                        3,233
Unrealized foreign exchange (gain) loss on revaluation of debt
(968
)
                      (2,360)
Deferred taxes
(465
)
                      (4,697)
Asset impairment
—

                        1,536
Loss on disposition of property and equipment
62

                      (1,333)
Loss on extinguishment of debt
—

                           388
Net change in operating assets and liabilities
(7,206
)
                        6,664
Net cash provided by operating activities
3,057

                      33,623
Interest expense, excluding amortization
9,873

                      37,810
Net change in operating assets and liabilities
7,206

                      (6,664)
Current portion of income tax expense
2,819

                      14,727
Stock-based compensation
(834
)
                      (3,098)
Unrealized foreign exchange gain (loss) on revaluation of debt
968

                        2,360
Curtailment settlement loss
—

                      (1,108)
Asset impairment
—

                      (1,536)
Loss on disposition of property and equipment
(62
)
                        1,333
Loss on extinguishment of debt
—

                         (388)
EBITDA
23,027

                      77,059
Loss on extinguishment of debt
—

                           388
Stock-based compensation
834

                        3,098
Operational restructuring expenses
2,777

                      12,525
Non-restrucutring impairment charges
—

                           499
Inventory write-off of closed facilities
—

                           587
Pension settlement loss
—

                        1,108
Start-up costs
539

                        3,439
Non-recurring expenses
434

                        2,382
Adjusted EBITDA
$
27,611

 $ 101,085

Source: Xerium Technologies, Inc.



Xerium Technologies, Inc.
Clifford Pietrafitta
919-526-1403
Cliff.Pietrafitta@xerium.com


 EX-99.2 3 noteofferingpressrelease.htm EXHIBIT 99.2 Exhibit

XERIUM TECHNOLOGIES, INC. ANNOUNCES PROPOSED SENIOR SECURED NOTES OFFERING

YOUNGSVILLE, N.C.--(BUSINESS WIRE)—July 18, 2016-- Xerium Technologies, Inc. (NYSE:XRM), a leading global provider of industrial consumable products and services, today announced its intention to offer, subject to market and other conditions, $475 million aggregate principal amount of senior secured notes due 2021.

Xerium intends to use the net proceeds from the offering to repay all amounts outstanding under its existing term loan credit facility, to redeem all of its 8.875% Senior Notes due 2018 and to pay premiums, fees and expenses in connection therewith.

The notes proposed to be offered have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities laws and may not be offered or sold in the United States or to any U.S. persons absent registration under the Securities Act, or pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. The notes will be offered only to "qualified institutional buyers" under Rule 144A of the Securities Act or, outside the United States, to persons other than "U.S. persons" in compliance with Regulation S under the Securities Act.

This press release is issued pursuant to Rule 135c of the Securities Act, is for informational purposes only and shall not constitute an offer to sell nor the solicitation of an offer to buy the notes or any other securities. The offering of the notes will not be made to any person in any jurisdiction in which the offer, solicitation or sale is unlawful.

ABOUT XERIUM TECHNOLOGIES

Xerium Technologies, Inc. (NYSE:XRM) is a leading global provider of industrial consumable products and services. Xerium, which operates around the world under a variety of brand names, utilizes a broad portfolio of patented and proprietary technologies to provide customers with tailored solutions and products integral to production, all designed to optimize performance and reduce operational costs. With 30 manufacturing facilities in 13 countries around the world, Xerium has approximately 3,000 employees.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements. The words "will", "believe," "estimate," "expect," "intend," "anticipate," "goals," variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. Forward-looking statements are not guarantees of future performance, and actual results may vary materially from the results expressed or implied in such statements. Differences may result from actions taken by us, as well as from risks and uncertainties beyond our control. These risks and uncertainties include the risks and uncertainties discussed elsewhere in this press release, our Form 10-K for the year ended December 31, 2015 filed on March 14,


2016 and our other SEC filings. If any of these risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may vary significantly from what we projected. Any forward-looking statement in this press release reflects our current views with respect to future events. Except as required by law, we assume no obligation to publicly update or revise these forward-looking statements for any reason, whether as a result of new information, future events, or otherwise. We are subject to substantial risks and uncertainties related to current economic conditions, and we encourage investors to refer to our SEC filings for additional information.

Source: Xerium Technologies, Inc.

Xerium Technologies, Inc.
Clifford Pietrafitta
919-526-1403
Cliff.Pietrafitta@xerium.com