FORM 8-K
|
Date of Report: July 31, 2012 |
(Date of earliest event reported)
|
A. M. CASTLE & CO.
|
(Exact name of registrant as specified in its charter)
|
Maryland
|
1-5415
|
36-0879160
|
(State or other jurisdiction of incorporation)
|
(Commission File Number)
|
(IRS Employer Identification No.)
|
1420 Kensington Road, Suite 220
Oak Brook, IL 60523
|
(Address of principal executive offices)
|
Registrant's telephone number including area code: (847) 455-7111
|
Not Applicable
|
(Former name or former address if changed since last report.)
|
Exhibit
|
||
Number
|
Description
|
|
99.1
|
A. M. Castle & Co. Press Release, dated July 31, 2012.
|
A. M. CASTLE & CO.
|
|||
July 31, 2012
|
By:
|
/s/ Robert J. Perna
|
|
Robert J. Perna
|
|||
Vice President, General Counsel & Secretary
|
Exhibit No.
|
|
Description
|
Page Number
|
|||
A. M. Castle & Co. Press Release, dated July 31, 2012
|
EX-1-
|
A.M. CASTLE & CO. |
1420 Kensington Road
Suite 220
Oak Brook, Illinois 60523
P: (847) 455-7111
F: (847) 241-8171
|
—————AT THE COMPANY————— | —————AT FTI CONSULTING———— | |
Scott F. Stephens | Analyst Contacts: | |
Interim Chief Executive Officer | Katie Pyra | |
Vice President-Finance & CFO | (312) 553-6717 | |
(847) 349-2577 | katie.pyra@fticonsulting.com | |
Email: sstephens@amcastle.com | ||
Traded: NYSE (CAS) | ||
Member: S&P SmallCap 600 Index |
Reconciliation of 2012 adjusted net income to reported net loss:
|
||||||||
(Dollars in millions, except per share data)
|
For the Three
|
For the Six
|
||||||
Unaudited
|
Months Ended
|
Months Ended
|
||||||
June 30
|
June 30
|
|||||||
Net loss, as reported
|
$ | (3.0 | ) | $ | (7.3 | ) | ||
Unrealized loss on debt conversion option
|
4.3 | 15.6 | ||||||
CEO transition costs, net
|
0.6 | 0.6 | ||||||
Unrealized losses on commodity hedges
|
1.3 | 0.9 | ||||||
Tax effect of adjustments
|
(0.6 | ) | (0.5 | ) | ||||
Adjusted non-GAAP net income
|
2.6 | 9.3 | ||||||
Adjusted non-GAAP basic income per share
|
$ | 0.11 | $ | 0.41 | ||||
Adjusted non-GAAP diluted income per share
|
0.11 | 0.39 | ||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
For the Three
|
For the Six
|
||||||||||||||
(Dollars in thousands, except per share data)
|
Months Ended
|
Months Ended
|
||||||||||||||
Unaudited
|
June 30,
|
June 30,
|
||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
Net sales
|
$ | 329,392 | $ | 282,568 | $ | 692,308 | $ | 555,356 | ||||||||
Costs and expenses:
|
||||||||||||||||
Cost of materials (exclusive of depreciation and amortization)
|
240,681 | 208,470 | 504,648 | 409,898 | ||||||||||||
Warehouse, processing and delivery expense
|
38,474 | 33,874 | 77,000 | 67,016 | ||||||||||||
Sales, general, and administrative expense
|
34,894 | 30,864 | 70,106 | 61,985 | ||||||||||||
Depreciation and amortization expense
|
6,474 | 5,059 | 13,087 | 10,058 | ||||||||||||
Operating income
|
8,869 | 4,301 | 27,467 | 6,399 | ||||||||||||
Interest expense, net
|
(9,964 | ) | (1,120 | ) | (20,157 | ) | (2,106 | ) | ||||||||
Interest expense - unrealized loss on debt conversion option
|
(4,257 | ) | - | (15,597 | ) | - | ||||||||||
(Loss) income before income taxes and equity in earnings of joint venture
|
(5,352 | ) | 3,181 | (8,287 | ) | 4,293 | ||||||||||
Income taxes
|
641 | (2,466 | ) | (3,732 | ) | (3,734 | ) | |||||||||
(Loss) income before equity in earnings of joint venture
|
(4,711 | ) | 715 | (12,019 | ) | 559 | ||||||||||
Equity in earnings of joint venture
|
1,733 | 2,982 | 4,741 | 5,841 | ||||||||||||
Net (loss) income
|
$ | (2,978 | ) | $ | 3,697 | $ | (7,278 | ) | $ | 6,400 | ||||||
Basic (loss) income per share
|
$ | (0.13 | ) | $ | 0.16 | $ | (0.32 | ) | $ | 0.28 | ||||||
Diluted (loss) income per share
|
$ | (0.13 | ) | $ | 0.16 | $ | (0.32 | ) | $ | 0.28 | ||||||
EBITDA*
|
$ | 17,076 | $ | 12,342 | $ | 45,295 | $ | 22,298 | ||||||||
*Earnings before interest, taxes, and depreciation and amortization
|
||||||||||||||||
Reconciliation of EBITDA and adjusted EBITDA to net income:
|
For the Three
|
For the Six
|
||||||||||||||
Months Ended
|
Months Ended
|
|||||||||||||||
June 30,
|
June 30,
|
|||||||||||||||
2012 | 2011 | 2012 | 2011 | |||||||||||||
Net (loss) income
|
$ | (2,978 | ) | $ | 3,697 | $ | (7,278 | ) | $ | 6,400 | ||||||
Depreciation and amortization expense
|
6,474 | 5,059 | 13,087 | 10,058 | ||||||||||||
Interest expense, net
|
9,964 | 1,120 | 20,157 | 2,106 | ||||||||||||
Interest expense - unrealized loss on debt conversion option
|
4,257 | - | 15,597 | - | ||||||||||||
Income taxes
|
(641 | ) | 2,466 | 3,732 | 3,734 | |||||||||||
EBITDA
|
17,076 | 12,342 | 45,295 | 22,298 | ||||||||||||
Non-GAAP net income adjustments (a)
|
1,857 | - | 1,423 | - | ||||||||||||
Adjusted EBITDA
|
$ | 18,933 | $ | 12,342 | $ | 46,718 | $ | 22,298 | ||||||||
(a) Non-GAAP net income adjustments relate to CEO transition costs and unrealized losses for commodity hedges. Refer to 'Reconciliation of 2012 adjusted net income to reported net loss' table on page EX-1- of this release.
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
||||||||
(Dollars in thousands, except par value data)
|
As of
|
|||||||
Unaudited
|
June 30,
|
December 31,
|
||||||
2012
|
2011
|
|||||||
ASSETS
|
||||||||
Current assets
|
||||||||
Cash and cash equivalents
|
$ | 20,449 | $ | 30,524 | ||||
Accounts receivable, less allowances of $4,219 and $3,584
|
178,075 | 181,036 | ||||||
Inventories, principally on last-in, first-out basis (replacement cost
|
364,391 | 272,039 | ||||||
higher by $144,979 and $138,882)
|
||||||||
Prepaid expenses and other current assets
|
20,980 | 10,382 | ||||||
Income tax receivable
|
3,781 | 8,287 | ||||||
Total current assets
|
587,676 | 502,268 | ||||||
Investment in joint venture
|
39,736 | 36,460 | ||||||
Goodwill
|
69,851 | 69,901 | ||||||
Intangible assets
|
87,833 | 93,813 | ||||||
Prepaid pension cost
|
16,501 | 15,956 | ||||||
Other assets
|
22,323 | 21,784 | ||||||
Property, plant and equipment
|
||||||||
Land
|
5,194 | 5,194 | ||||||
Building
|
52,398 | 52,434 | ||||||
Machinery and equipment
|
174,485 | 172,833 | ||||||
Property, plant and equipment, at cost
|
232,077 | 230,461 | ||||||
Less - accumulated depreciation
|
(153,022 | ) | (148,320 | ) | ||||
Property, plant and equipment, net
|
79,055 | 82,141 | ||||||
Total assets
|
$ | 902,975 | $ | 822,323 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
Current liabilities
|
||||||||
Accounts payable
|
$ | 179,661 | $ | 116,874 | ||||
Accrued liabilities
|
39,781 | 33,828 | ||||||
Income taxes payable
|
1,526 | 1,884 | ||||||
Current portion of long-term debt
|
212 | 192 | ||||||
Short-term debt
|
1,000 | 500 | ||||||
Total current liabilities
|
222,180 | 153,278 | ||||||
Long-term debt, less current portion
|
290,570 | 314,240 | ||||||
Deferred income taxes
|
32,635 | 25,650 | ||||||
Other non-current liabilities
|
7,156 | 7,252 | ||||||
Pension and post retirement benefit obligations
|
9,821 | 9,624 | ||||||
Commitments and contingencies
|
||||||||
Stockholders' equity
|
||||||||
Preferred stock, $0.01 par value - 9,988 shares authorized; no shares
|
||||||||
issued and outstanding at June 30, 2012 and December 31, 2011
|
- | - | ||||||
Common stock, $0.01 par value - 60,000 shares authorized;
|
||||||||
23,211 shares issued and 23,092 outstanding at June 30, 2012 and 23,159 shares
|
||||||||
issued and 23,010 outstanding at December 31, 2011
|
232 | 232 | ||||||
Additional paid-in capital
|
220,181 | 184,596 | ||||||
Retained earnings
|
141,709 | 148,987 | ||||||
Accumulated other comprehensive loss
|
(20,084 | ) | (19,824 | ) | ||||
Treasury stock, at cost - 119 shares at June 30, 2012 and 149 shares at
|
||||||||
December 31, 2011
|
(1,425 | ) | (1,712 | ) | ||||
Total stockholders' equity
|
340,613 | 312,279 | ||||||
Total liabilities and stockholders' equity
|
$ | 902,975 | $ | 822,323 |
TOTAL DEBT
|
||||||||
(Dollars in thousands)
|
||||||||
Unaudited
|
June 30, | December 31, | ||||||
2012
|
2011
|
|||||||
SHORT-TERM DEBT
|
||||||||
Foreign
|
$ | 1,000 | $ | 500 | ||||
Total short-term debt
|
1,000 | 500 | ||||||
LONG-TERM DEBT
|
||||||||
12.75% Senior Secured Notes due December 15, 2016
|
225,000 | 225,000 | ||||||
7.0% Convertible Notes due December 15, 2017
|
57,500 | 57,500 | ||||||
New Revolving Credit Facility due December 15, 2015
|
36,300 | 35,500 | ||||||
Other, primarily capital leases
|
547 | 244 | ||||||
Total long-term debt
|
319,347 | 318,244 | ||||||
Plus: derivative liability for conversion feature associated with convertible debt
|
- | 26,440 | ||||||
Less: unamortized discount
|
(28,565 | ) | (30,252 | ) | ||||
Less: current portion
|
(212 | ) | (192 | ) | ||||
Total long-term portion
|
290,570 | 314,240 | ||||||
TOTAL DEBT
|
$ | 291,782 | $ | 314,932 | ||||