EX-99.1 2 d570754dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO    

News Release

NYSE: MYE

Contact(s):

Gregg Branning, Senior Vice President

& Chief Financial Officer (330) 761-6303

Monica Vinay, Director, Investor

& Financial Relations (330) 761-6212

Myers Industries Reports 2013 Second Quarter Results

 

   

Net sales rose 12.7% year-over-year

 

   

Second quarter diluted EPS up 47% compared to last year

 

   

Significant profit improvement year-over-year by the Lawn and Garden Segment for the second consecutive quarter; Second phase of restructuring announced

 

   

Strong operating cash flow generation

 

   

Expect year-over-year EPS growth in the second half of 2013

July 18, 2013, Akron, Ohio - Myers Industries, Inc. (NYSE: MYE) today announced results for the second quarter ended June 30, 2013.

Summary

 

     Three Months Ended June 30,     Six Months Ended June 30,  
     2013     2012     % Increase
(Decrease)
    2013     2012     % Increase
(Decrease)
 
     (Dollars in thousands, except share data)  

Net sales

   $ 204,024      $ 181,101        12.7   $ 419,004      $ 379,890        10.3

Gross profit

   $ 55,769      $ 47,364        17.7   $ 114,087      $ 105,362        8.3

Gross profit margin

     27.3     26.2       27.2     27.7  

Income before taxes

   $ 12,003      $ 8,938        34.3   $ 24,155      $ 24,974        (3.3 )% 

Net Income:

      

Income

   $ 8,312      $ 5,658        46.9   $ 16,195      $ 15,643        3.5

Income per diluted share

   $ 0.25      $ 0.17        47.1   $ 0.48      $ 0.46        4.3

Income before taxes as adjusted*

   $ 13,388      $ 9,199        45.5   $ 26,247      $ 25,791        1.8

Net income as adjusted*:

      

Income

   $ 8,434      $ 5,703        47.9   $ 16,536      $ 15,990        3.4

Income per diluted share

   $ 0.25      $ 0.17        47.1   $ 0.49      $ 0.47        4.3

 

* Details regarding the special pre-tax adjusted charges are provided on the Reconciliation of Non-GAAP Financial Measures included in this release.

 

   

Net sales in the second quarter of 2013 rose 12.7% compared to the second quarter of 2012, reflecting strong sales in the Material Handing Segment.

 

   

The overall gross margin was 27.3% in the second quarter of 2013 compared to 26.2% in the second quarter of 2012. The increase was due mostly to cost savings that resulted from productivity improvements and material substitutions.


   

Net Income per diluted share increased 47% to $0.25 in the second quarter of 2013 compared to $0.17 in the second quarter of 2012, reflecting benefits from the Novel and Jamco acquisitions, cost reductions and the improved performance of the Lawn and Garden Segment.

President and Chief Executive Officer John C. Orr said, “I am very pleased with our performance in the second quarter as highlighted by our increased earnings per share of 47% year-over-year. I am particularly pleased with the second consecutive quarter of significant profit improvement in our Lawn and Garden Segment which is reflected in the segment’s year-over-year increase in adjusted income before taxes of $2.7 million. Our recent acquisitions also contributed to our earnings per share growth and continue to be accretive.”

Orr continued, “Earlier today, in a separate release, we announced phase two of our Lawn and Garden Segment restructuring which will position the segment for future growth and deliver annual savings of $8.0 million. A portion of those savings will begin to be realized in the fourth quarter of 2013. This second phase, coupled with the $5.0 million savings from the on-going phase one cost reduction initiative, will result in a total annual savings of $13.0 million in 2014.”

Segment Results

The results below are as adjusted and exclude special pre-tax charges as detailed on the Reconciliation of Non-GAAP Financial Measures included in this release.

Net sales in the Material Handling Segment for the second quarter of 2013 were $83.8 million compared to $60.3 million for the second quarter of 2012. The sales increase was driven by the Novel and Jamco acquisitions, a shift in customer orders into the second quarter and organic growth. Material Handling’s adjusted income before taxes was $11.0 million for the second quarter of 2013 compared to $9.2 million for the second quarter of 2012. The increase in income before taxes was due mostly to the higher sales volumes and the acquisitions of Novel and Jamco.

Net sales in the Lawn and Garden Segment for the second quarter of 2013 were $40.9 million compared to $42.5 million for the second quarter of 2012. Lawn and Garden’s adjusted income before taxes for the second quarter of 2013 was $1.2 million compared to a loss of $1.5 million for the second quarter of 2012. Productivity improvements and material substitution cost savings were the primary drivers behind the increase in adjusted income before taxes year-over-year.

Net sales in the Distribution Segment were $45.9 million for the second quarter of 2013 compared to $44.2 million for the second quarter of 2012. The increase in sales was due mostly to sales of new products and market share gains in equipment sales. Distribution’s adjusted income before taxes was $3.9 million for the second quarter of 2013 compared to $4.1 million for the second quarter of 2012. Distribution continues to be impacted by a slow replacement tire market. Costs associated with an upgrade in the segment’s information technology system contributed to the decline in adjusted income before taxes year-over-year.

Net sales in the Engineered Products Segment were $37.6 million for the second quarter of 2013 compared to $38.6 million for the second quarter of 2012. Strong sales in the marine and recreational vehicle markets were more than offset by a decline in custom sales year-over-year. Engineered Products’ adjusted income before taxes was $5.1 million for the second quarter of 2013 compared to $4.7 million for the second quarter of 2012. A favorable product mix and productivity improvements led to the increase in income before taxes year-over-year, despite the lower sales.

Other Financial Items

For the six months ended June 30, 2013, cash flow provided by operations was $30.1 million compared to $7.9 million in the first half of 2012, reflecting efforts to better manage working capital.

Capital expenditures totaled $10.2 million for the six months ended June 30, 2013 and are still forecasted to be approximately $30 million to $35 million in 2013.

Outlook

The Company expects continued year-over-year improvement in each of the next two quarters in both sales and adjusted earnings excluding special pre-tax adjusted charges. These improvements will come from our recent acquisitions, organic growth, continued reinvestment in our operations, new product introductions, cost savings and the expected benefits from the Lawn and Garden Segment restructuring initiatives.

Conference Call Details

The Company will host an earnings conference call and webcast for investors and analysts on Thursday, July 18, 2013 at 10:00 a.m. ET. The call is anticipated to last approximately one hour and may be accessed at (877) 407-8033.


Callers are asked to sign on at least five minutes in advance. The call will be available as a webcast through the Company’s web site, www.myersindustries.com. Click on the Investor Relations tab to access the webcast. Webcast attendees will be in a listen-only mode. An archived replay of the call will also be available on the site shortly after the event. To listen to a telephone replay, callers should dial: (US) 877-660-6853 or (Int’l) 201-612-7415. The replay passcode is Conference ID #417438.

About Myers Industries

Myers Industries, Inc. is an international manufacturer of polymer products for industrial, agricultural, automotive, commercial, and consumer markets. The Company is also the largest wholesale distributor of tools, equipment and supplies for the tire, wheel and undervehicle service industry in the U.S. Visit www.myersindustries.com to learn more.

Caution on Forward-Looking Statements

Statements in this release may include “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statement that is not of historical fact may be deemed “forward-looking”. Words such as “expect”, “believe”, “project”, “plan”, “anticipate”, “intend”, “objective”, “goal”, “view”, and similar expressions identify forward-looking statements. These statements are based on management’s current views and assumptions of future events and financial performance and involve a number of risks and uncertainties, many outside of the Company’s control that could cause actual results to materially differ from those expressed or implied. Risks and uncertainties include: changes in the markets for the Company’s business segments; changes in trends and demands in the markets in which the Company competes; unanticipated downturn in business relationships with customers or their purchases; competitive pressures on sales and pricing; raw material availability, increases in raw material costs, or other production costs; future economic and financial conditions in the United States and around the world; ability to weather the current economic downturn; inability of the Company to meet future capital requirements; claims, litigation and regulatory actions against the Company; changes in laws and regulations affecting the Company; the Company’s ability to execute the components of its Strategic Business Evolution process; and other risks as detailed in the Company’s 10-K and other reports filed with the Securities and Exchange Commission. Such reports are available on the Securities and Exchange Commission’s public reference facilities and its web site at http://www.sec.gov, and on the Company’s Investor Relations section of its web site at http://www.myersindustries.com. Myers Industries undertakes no obligation to publicly update or revise any forward-looking statements contained herein. These statements speak only as of the date made.


MYERS INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

FOR THE QUARTER AND SIX MONTHS ENDED JUNE 30, 2013 AND 2012

(Dollars in thousands, except share data)

 

     For the Quarter Ended      For the Six Months Ended  
     June 30, 2013      June 30, 2012      June 30, 2013      June 30, 2012  

Net sales

   $ 204,024       $ 181,101       $ 419,004       $ 379,890   

Cost of sales

     148,255         133,737         304,917         274,528   
  

 

 

    

 

 

    

 

 

    

 

 

 

Gross profit

     55,769         47,364         114,087         105,362   

Selling, general and administrative expenses

     42,650         37,372         87,724         78,253   
  

 

 

    

 

 

    

 

 

    

 

 

 

Operating income

     13,119         9,992         26,363         27,109   

Interest expense, net

     1,116         1,054         2,208         2,135   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income before income taxes

     12,003         8,938         24,155         24,974   

Income tax expense

     3,691         3,280         7,960         9,331   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net income

   $ 8,312       $ 5,658       $ 16,195       $ 15,643   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income per common share:

           

Basic

   $ 0.25       $ 0.17       $ 0.48       $ 0.47   

Diluted

   $ 0.25       $ 0.17       $ 0.48       $ 0.46   

Weighted Average Common Shares Outstanding

           

Basic

     33,559,398         33,595,637         33,529,004         33,525,444   

Diluted

     33,877,952         34,272,693         33,897,962         34,121,486   


MYERS INDUSTRIES, INC.

SALES AND EARNINGS BY SEGMENT (UNAUDITED)

(Dollars in thousands)

 

     Second Quarter Ended June 30,     Six Months Ended June 30,  
     2013     2012     % Change     2013     2012     % Change  

Net Sales

      

Material Handling

   $ 83,814      $ 60,260        39.1   $ 163,803      $ 125,481        30.5

Lawn and Garden

     40,889        42,482        (3.7 )%      101,252        101,666        (0.4 )% 

Distribution

     45,893        44,188        3.9     88,542        86,926        1.9

Engineered Products

     37,608        38,642        (2.7 )%      74,564        75,869        (1.7 )% 

Inter-company Sales

     (4,180     (4,471     —          (9,157     (10,052     —     
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 204,024      $ 181,101        12.7   $ 419,004      $ 379,890        10.3
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (Loss)

      

Before Income Taxes

      

Material Handling

   $ 11,010      $ 9,223        19.4   $ 20,715      $ 22,373        (7.4 )% 

Lawn and Garden

     (109     (1,942     —          2,172        (724     —     

Distribution

     3,864        4,298        (10.1 )%      6,703        7,809        (14.2 )% 

Engineered Products

     5,134        4,660        10.2     10,211        9,251        10.4

Corporate

     (7,896     (7,301     —          (15,646     (13,735     —     
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 12,003      $ 8,938        34.3   $ 24,155      $ 24,974        (3.3 )% 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


MYERS INDUSTRIES, INC.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

INCOME (LOSS) BEFORE TAXES BY SEGMENT (UNAUDITED)

(Dollars in millions, except per share data)

 

     Quarter Ended
June 30
    Six Months Ended
June  30
 
     2013     2012     2013     2012  

Material Handling

        

Income before taxes as reported

   $ 11.0      $ 9.2      $ 20.7      $ 22.4   

Restructuring expenses

     0.0        0.0        0.2        0.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes as adjusted

     11.0        9.2        20.9        22.4   

Lawn and Garden

        

Income (loss) before taxes as reported

     (0.1     (1.9     2.2        (0.7

Restructuring expenses

     0.7        0.4        1.1        0.4   

Loss on disposal of assets

     0.6        0.0        0.6        0.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes as adjusted

     1.2        (1.5     3.9        (0.3

Distribution

        

Income before taxes as reported

     3.9        4.3        6.7        7.8   

Restructuring expenses

     0.0        0.1        0.1        0.5   

Gain on building sale

     0.0        (0.3     0.0        (0.3
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes as adjusted

     3.9        4.1        6.8        8.0   

Engineered Products

        

Income before taxes as reported

     5.1        4.6        10.2        9.2   

Restructuring expenses

     0.0        0.1        0.0        0.2   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes as adjusted

     5.1        4.7        10.2        9.4   

Corporate and interest expense

        

Income (loss) before taxes as reported

     (7.9     (7.3     (15.6     (13.7

Income (loss) before taxes as adjusted

     (7.9     (7.3     (15.6     (13.7

Consolidated

        

Income before taxes as reported

     12.0        8.9        24.2        25.0   

Restructuring expenses and other adjustments

     1.4        0.3        2.0        0.8   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes as adjusted

     13.4        9.2        26.2        25.8   

Income taxes

     5.0        3.5        9.7        9.8   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income as adjusted

   $ 8.4      $ 5.7      $ 16.5      $ 16.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted earnings per diluted share

   $ 0.25      $ 0.17      $ 0.49      $ 0.47   

Note: Numbers in the Corporate and interest expense section above may be rounded for presentation purposes.

Note on Reconciliation of Income and Earnings Data: Income (loss) excluding the items mentioned above in the text of this release and in this reconciliation chart is a non-GAAP financial measure that Myers Industries, Inc. calculates according to the schedule above, using GAAP amounts from the unaudited Consolidated Financial Statements. The Company believes that the excluded items are not primarily related to core operational activities. The Company believes that income (loss) excluding items that are not primarily related to core operating activities is generally viewed as providing useful information regarding a company’s operating profitability. Management uses income (loss) excluding these items as well as other financial measures in connection with its decision-making activities. Income (loss) excluding these items should not be considered in isolation or as a substitute for net income (loss), income (loss) before taxes or other consolidated income data prepared in accordance with GAAP. The Company’s method for calculating income (loss) excluding these items may not be comparable to methods used by other companies.


MYERS INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)

(Dollars in thousands)

 

     June 30,
2013
     December 31,
2012
 

Assets

     

Current Assets

     

Cash

   $ 22,258       $ 3,948   

Accounts receivable, net

     108,518         115,508   

Inventories

     106,115         107,502   

Other

     12,023         12,638   
  

 

 

    

 

 

 

Total Current Assets

     248,914         239,596   

Other Assets

     91,802         94,777   

Property, Plant, & Equipment, Net

     142,255         150,483   
  

 

 

    

 

 

 

Total Assets

   $ 482,971       $ 484,856   
  

 

 

    

 

 

 

Liabilities & Shareholders’ Equity

     

Current Liabilities

     

Accounts payable

   $ 64,717       $ 72,417   

Accrued expenses

     39,369         42,060   
  

 

 

    

 

 

 

Total Current Liabilities

     104,086         114,477   

Long-term debt

     95,988         92,814   

Other liabilities

     17,911         17,865   

Deferred income taxes

     29,966         29,678   

Total Shareholders’ Equity

     235,020         230,022   
  

 

 

    

 

 

 

Total Liabilities & Shareholders’ Equity

   $ 482,971       $ 484,856   
  

 

 

    

 

 

 


MYERS INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

FOR THE SIX MONTHS ENDED JUNE 30, 2013 AND 2012

(Dollars in thousands)

 

     June 30, 2013     June 30, 2012  

Cash Flows From Operating Activities

    

Net income

   $ 16,195      $ 15,643   

Items not affecting use of cash

    

Depreciation

     16,146        14,737   

Loss on disposal of assets

     616        —     

Amortization of intangible assets

     2,046        1,514   

Non-cash stock compensation

     1,532        1,556   

Provision for (recovery of) loss on accounts receivable

     496        (1,178

Deferred taxes

     2,140        (18

Other long-term liabilities

     334        785   

Gain on sale of property, plant and equipment

     —          (558

Other

     11        50   

Cash flow provided by (used for) working capital, net of acquisitions:

    

Accounts receivable

     5,216        10,384   

Inventories

     (735     (12,285

Prepaid expenses

     (1,048     (3,743

Accounts payable and accrued expenses

     (12,812     (18,967
  

 

 

   

 

 

 

Net cash provided by operating activities

     30,137        7,920   
  

 

 

   

 

 

 

Cash Flows From Investing Activities

    

Capital expenditures

     (10,216     (8,386

Acquisition of business, net of cash acquired

     (600     —     

Proceeds from sale of property, plant and equipment

     —          1,805   

Other

     (11     (149
  

 

 

   

 

 

 

Net cash used for investing activities

     (10,827     (6,730
  

 

 

   

 

 

 

Cash Flows From Financing Activities

    

Repayment of long-term debt

     —          (305

Net borrowing on credit facility

     3,173        28,374   

Cash dividends paid

     (3,019     (4,967

Proceeds from issuance of common stock

     3,262        2,822   

Tax benefit from options

     50        —     

Repurchase of common stock

     (3,982     —     
  

 

 

   

 

 

 

Net cash (used for) provided by financing activities

     (516     25,924   
  

 

 

   

 

 

 

Foreign Exchange Rate Effect on Cash

     (484     1,697   
  

 

 

   

 

 

 

Net increase in cash

     18,310        28,811   

Cash at January 1

     3,948        6,801   
  

 

 

   

 

 

 

Cash at June 30

   $ 22,258      $ 35,612