UNITED STATES | ||
SECURITIES AND EXCHANGE COMMISSION | ||
Washington, D.C. 20549 | ||
FORM 8-K |
Delaware | 001-10716 | 38-2687639 | ||
(State or other jurisdiction | (Commission | (IRS Employer | ||
of incorporation) | File Number) | Identification No.) |
38505 Woodward Avenue, Suite 200, Bloomfield Hills, Michigan | 48304 | |
(Address of principal executive offices) | (Zip Code) |
Emerging growth company | o |
Exhibit No. | Description | |||
99.1 | ||||
99.2 |
TRIMAS CORPORATION | ||||||
Date: | February 27, 2018 | By: | /s/ Robert J. Zalupski | |||
Name: | Robert J. Zalupski | |||||
Title: | Chief Financial Officer |
CONTACT: |
Sherry Lauderback |
VP, Investor Relations & Communications |
(248) 631-5506 |
sherrylauderback@trimascorp.com |
• | Increased net sales by 3.0% to $817.7 million with sales increases in all segments |
• | Increased operating profit to $88.5 million, while operating profit, excluding Special Items(1), increased by 12.3% to $106.3 million |
• | Increased net cash provided by operating activities by 49.2% to $120.1 million compared to 2016 |
• | Reduced total debt by $71.6 million, or 19.1%, to $303.1 million compared to December 31, 2016 |
(1) | Appendix I details certain costs, expenses and other amounts or charges, collectively described as "Special Items," that are included in the determination of net income, earnings per share and/or cash flows from operating activities under GAAP, but that management believes should be separately considered when evaluating the quality of the Company’s core operating results, given they may not reflect the ongoing activities of the business. Management believes that presenting these non- |
(2) | The Company defines Free Cash Flow as Net Cash Provided by/Used for Operating Activities, excluding the cash impact of Special Items, less Capital Expenditures. Please see Appendix I for additional details. |
December 31, 2017 | December 31, 2016 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 27,580 | $ | 20,710 | ||||
Receivables, net | 112,220 | 111,570 | ||||||
Inventories | 155,350 | 160,460 | ||||||
Prepaid expenses and other current assets | 16,120 | 16,060 | ||||||
Total current assets | 311,270 | 308,800 | ||||||
Property and equipment, net | 190,250 | 179,160 | ||||||
Goodwill | 319,390 | 315,080 | ||||||
Other intangibles, net | 194,220 | 213,920 | ||||||
Deferred income taxes | 9,100 | 26,290 | ||||||
Other assets | 8,970 | 8,400 | ||||||
Total assets | $ | 1,033,200 | $ | 1,051,650 | ||||
Liabilities and Shareholders' Equity | ||||||||
Current liabilities: | ||||||||
Current maturities, long-term debt | $ | — | $ | 13,810 | ||||
Accounts payable | 72,410 | 72,270 | ||||||
Accrued liabilities | 49,470 | 47,190 | ||||||
Total current liabilities | 121,880 | 133,270 | ||||||
Long-term debt, net | 303,080 | 360,840 | ||||||
Deferred income taxes | 5,650 | 5,910 | ||||||
Other long-term liabilities | 58,570 | 51,910 | ||||||
Total liabilities | 489,180 | 551,930 | ||||||
Total shareholders' equity | 544,020 | 499,720 | ||||||
Total liabilities and shareholders' equity | $ | 1,033,200 | $ | 1,051,650 |
Three months ended December 31, | Twelve months ended December 31, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(unaudited) | ||||||||||||||||
Net sales | $ | 195,210 | $ | 185,530 | $ | 817,740 | $ | 794,020 | ||||||||
Cost of sales | (146,070 | ) | (146,100 | ) | (598,600 | ) | (583,540 | ) | ||||||||
Gross profit | 49,140 | 39,430 | 219,140 | 210,480 | ||||||||||||
Selling, general and administrative expenses | (32,900 | ) | (36,910 | ) | (129,570 | ) | (153,710 | ) | ||||||||
Net gain (loss) on dispositions of property and equipment | 2,140 | (520 | ) | (1,080 | ) | (1,870 | ) | |||||||||
Impairment of goodwill and indefinite-lived intangible assets | — | (98,900 | ) | — | (98,900 | ) | ||||||||||
Operating profit (loss) | 18,380 | (96,900 | ) | 88,490 | (44,000 | ) | ||||||||||
Other expense, net: | ||||||||||||||||
Interest expense | (4,040 | ) | (3,490 | ) | (14,400 | ) | (13,720 | ) | ||||||||
Debt financing and related expenses | — | — | (6,640 | ) | — | |||||||||||
Other expense, net | (460 | ) | (380 | ) | (1,240 | ) | (510 | ) | ||||||||
Other expense, net | (4,500 | ) | (3,870 | ) | (22,280 | ) | (14,230 | ) | ||||||||
Income (loss) before income tax expense | 13,880 | (100,770 | ) | 66,210 | (58,230 | ) | ||||||||||
Income tax benefit (expense) | (17,890 | ) | 33,410 | (35,250 | ) | 18,430 | ||||||||||
Net income (loss) | (4,010 | ) | (67,360 | ) | 30,960 | (39,800 | ) | |||||||||
Basic earnings (loss) per share: | ||||||||||||||||
Net income (loss) per share | $ | (0.09 | ) | $ | (1.48 | ) | $ | 0.68 | $ | (0.88 | ) | |||||
Weighted average common shares - basic | 45,721,160 | 45,484,485 | 45,682,627 | 45,407,316 | ||||||||||||
Diluted earnings (loss) per share: | ||||||||||||||||
Net income (loss) per share | $ | (0.09 | ) | $ | (1.48 | ) | $ | 0.67 | $ | (0.88 | ) | |||||
Weighted average common shares - diluted | 45,721,160 | 45,484,485 | 45,990,252 | 45,407,316 |
Twelve months ended December 31, | ||||||||
2017 | 2016 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net income (loss) | $ | 30,960 | $ | (39,800 | ) | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||
Impairment of goodwill and indefinite-lived intangible assets | — | 98,900 | ||||||
Loss on dispositions of assets | 1,080 | 1,870 | ||||||
Depreciation | 26,950 | 24,390 | ||||||
Amortization of intangible assets | 19,920 | 20,470 | ||||||
Amortization of debt issue costs | 1,320 | 1,370 | ||||||
Deferred income taxes | 15,260 | (32,160 | ) | |||||
Non-cash compensation expense | 6,780 | 6,940 | ||||||
Tax effect from stock based compensation | — | (640 | ) | |||||
Debt financing and related expenses | 6,640 | — | ||||||
Decrease in receivables | 1,220 | 7,990 | ||||||
Decrease in inventories | 4,350 | 5,180 | ||||||
(Increase) decrease in prepaid expenses and other assets | (310 | ) | 2,550 | |||||
Increase (decrease) in accounts payable and accrued liabilities | 3,640 | (18,120 | ) | |||||
Other operating activities | 2,250 | 1,530 | ||||||
Net cash provided by operating activities | 120,060 | 80,470 | ||||||
Cash Flows from Investing Activities: | ||||||||
Capital expenditures | (36,800 | ) | (31,330 | ) | ||||
Net proceeds from dispositions of property and equipment | 4,450 | 220 | ||||||
Net cash used for investing activities | (32,350 | ) | (31,110 | ) | ||||
Cash Flows from Financing Activities: | ||||||||
Proceeds from issuance of senior notes | 300,000 | — | ||||||
Repayments of borrowings on term loan facilities | (257,940 | ) | (13,850 | ) | ||||
Proceeds from borrowings on revolving credit and accounts receivable facilities | 401,300 | 402,420 | ||||||
Repayments of borrowings on revolving credit and accounts receivable facilities | (517,310 | ) | (433,350 | ) | ||||
Payments for deferred purchase price | — | (2,530 | ) | |||||
Debt financing fees | (6,070 | ) | — | |||||
Shares surrendered upon options and restricted stock vesting to cover taxes | (510 | ) | (1,590 | ) | ||||
Other financing activities | (310 | ) | 800 | |||||
Net cash used for financing activities | (80,840 | ) | (48,100 | ) | ||||
Cash and Cash Equivalents: | ||||||||
Increase for the year | 6,870 | 1,260 | ||||||
At beginning of year | 20,710 | 19,450 | ||||||
At end of year | $ | 27,580 | $ | 20,710 | ||||
Supplemental disclosure of cash flow information: | ||||||||
Cash paid for interest | $ | 9,430 | $ | 11,800 | ||||
Cash paid for income taxes | $ | 16,230 | $ | 17,210 |
Three months ended December 31, | Twelve months ended December 31, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Packaging | ||||||||||||||||
Net sales | $ | 85,310 | $ | 82,790 | $ | 344,570 | $ | 341,340 | ||||||||
Operating profit | $ | 18,900 | $ | 18,500 | $ | 80,380 | $ | 77,840 | ||||||||
Special Items to consider in evaluating operating profit: | ||||||||||||||||
Business restructuring and severance costs | 40 | 1,870 | 1,710 | 4,590 | ||||||||||||
Excluding Special Items, operating profit would have been: | $ | 18,940 | $ | 20,370 | $ | 82,090 | $ | 82,430 | ||||||||
Aerospace | ||||||||||||||||
Net sales | $ | 42,760 | $ | 42,900 | $ | 184,310 | $ | 174,920 | ||||||||
Operating profit (loss) | $ | 6,500 | $ | (104,480 | ) | $ | 26,190 | $ | (90,810 | ) | ||||||
Special Items to consider in evaluating operating profit: | ||||||||||||||||
Business restructuring and severance costs | — | 6,900 | — | 9,700 | ||||||||||||
Impairment of goodwill and indefinite-lived intangible assets | — | 98,900 | — | 98,900 | ||||||||||||
Excluding Special Items, operating profit would have been: | $ | 6,500 | $ | 1,320 | $ | 26,190 | $ | 17,790 | ||||||||
Energy | ||||||||||||||||
Net sales | $ | 36,720 | $ | 36,060 | $ | 161,580 | $ | 158,990 | ||||||||
Operating loss | $ | (2,860 | ) | $ | (5,270 | ) | $ | (5,410 | ) | $ | (13,840 | ) | ||||
Special Items to consider in evaluating operating profit: | ||||||||||||||||
Business restructuring and severance costs | 3,950 | 6,230 | 14,750 | 19,460 | ||||||||||||
Excluding Special Items, operating profit would have been: | $ | 1,090 | $ | 960 | $ | 9,340 | $ | 5,620 | ||||||||
Engineered Components | ||||||||||||||||
Net sales | $ | 30,420 | $ | 23,780 | $ | 127,280 | $ | 118,770 | ||||||||
Operating profit | $ | 2,740 | $ | 2,680 | $ | 15,740 | $ | 15,300 | ||||||||
Special Items to consider in evaluating operating profit: | ||||||||||||||||
Business restructuring and severance costs | 600 | 130 | 600 | 530 | ||||||||||||
Excluding Special Items, operating profit would have been: | $ | 3,340 | $ | 2,810 | $ | 16,340 | $ | 15,830 | ||||||||
Corporate Expenses | ||||||||||||||||
Operating loss | $ | (6,900 | ) | $ | (8,330 | ) | $ | (28,410 | ) | $ | (32,490 | ) | ||||
Special Items to consider in evaluating operating loss: | ||||||||||||||||
Business restructuring and severance costs | 390 | 1,910 | 750 | 5,470 | ||||||||||||
Excluding Special Items, operating loss would have been: | $ | (6,510 | ) | $ | (6,420 | ) | $ | (27,660 | ) | $ | (27,020 | ) | ||||
Total Company | ||||||||||||||||
Net sales | $ | 195,210 | $ | 185,530 | $ | 817,740 | $ | 794,020 | ||||||||
Operating profit (loss) | $ | 18,380 | $ | (96,900 | ) | $ | 88,490 | $ | (44,000 | ) | ||||||
Total Special Items to consider in evaluating operating profit: | 4,980 | 115,940 | 17,810 | 138,650 | ||||||||||||
Excluding Special Items, operating profit would have been: | $ | 23,360 | $ | 19,040 | $ | 106,300 | $ | 94,650 |
Three months ended December 31, | Twelve months ended December 31, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Net income (loss), as reported | $ | (4,010 | ) | $ | (67,360 | ) | $ | 30,960 | $ | (39,800 | ) | |||||
Special Items to consider in evaluating quality of net income: | ||||||||||||||||
Business restructuring and severance costs | 5,580 | 17,210 | 18,130 | 40,560 | ||||||||||||
Impairment of goodwill and indefinite-lived intangible assets | — | 98,900 | — | 98,900 | ||||||||||||
Debt financing and related expenses | — | — | 6,640 | — | ||||||||||||
Income tax effect of Special Items (1) | 270 | (35,150 | ) | (4,010 | ) | (41,930 | ) | |||||||||
Tax reform charges (2) | 12,660 | — | 12,660 | — | ||||||||||||
Excluding Special Items, net income would have been | $ | 14,500 | $ | 13,600 | $ | 64,380 | $ | 57,730 | ||||||||
Three months ended December 31, | Twelve months ended December 31, | |||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
Diluted earnings (loss) per share, as reported | $ | (0.09 | ) | $ | (1.48 | ) | $ | 0.67 | $ | (0.88 | ) | |||||
Dilutive impact (3) | — | 0.01 | — | 0.01 | ||||||||||||
Special Items to consider in evaluating quality of EPS: | ||||||||||||||||
Business restructuring and severance costs | 0.12 | 0.38 | 0.40 | 0.89 | ||||||||||||
Impairment of goodwill and indefinite-lived intangible assets | — | 2.16 | — | 2.16 | ||||||||||||
Debt financing and related expenses | — | — | 0.14 | — | ||||||||||||
Income tax effect of Special Items (1) | — | (0.77 | ) | (0.09 | ) | (0.92 | ) | |||||||||
Tax reform charges (2) | 0.28 | — | 0.28 | — | ||||||||||||
Excluding Special Items, diluted EPS would have been | $ | 0.31 | $ | 0.30 | $ | 1.40 | $ | 1.26 | ||||||||
Weighted-average shares outstanding for the three and twelve months ended December 31, 2017 and 2016 | 46,100,275 | 45,786,801 | 45,990,252 | 45,732,105 | ||||||||||||
Three months ended December 31, | ||||||||||||||||||||||||
2017 | 2016 | |||||||||||||||||||||||
As reported | Special Items | Excluding Special Items | As reported | Special Items | Excluding Special Items | |||||||||||||||||||
Net cash provided by operating activities | $ | 47,410 | $ | 1,970 | $ | 49,380 | $ | 34,060 | $ | 8,090 | $ | 42,150 | ||||||||||||
Less: Capital expenditures | (12,680 | ) | — | (12,680 | ) | (8,940 | ) | — | (8,940 | ) | ||||||||||||||
Free Cash Flow | 34,730 | 1,970 | 36,700 | 25,120 | 8,090 | 33,210 | ||||||||||||||||||
Net income (loss) | (4,010 | ) | 18,510 | 14,500 | (67,360 | ) | 80,960 | 13,600 | ||||||||||||||||
Free Cash Flow as a percentage of net income (loss) | (866 | )% | 253 | % | (37 | )% | 244 | % | ||||||||||||||||
Twelve months ended December 31, | ||||||||||||||||||||||||
2017 | 2016 | |||||||||||||||||||||||
As reported | Special Items | Excluding Special Items | As reported | Special Items | Excluding Special Items | |||||||||||||||||||
Net cash provided by operating activities | $ | 120,060 | $ | 16,970 | $ | 137,030 | 80,470 | $ | 23,610 | $ | 104,080 | |||||||||||||
Less: Capital expenditures | (36,800 | ) | — | (36,800 | ) | (31,330 | ) | — | (31,330 | ) | ||||||||||||||
Free Cash Flow | 83,260 | 16,970 | 100,230 | 49,140 | 23,610 | 72,750 | ||||||||||||||||||
Net income (loss) | 30,960 | 33,420 | 64,380 | (39,800 | ) | 97,530 | 57,730 | |||||||||||||||||
Free Cash Flow as a percentage of net income (loss) | 269 | % | 156 | % | (123 | )% | 126 | % | ||||||||||||||||
December 31, 2017 | December 31, 2016 | |||||||
Current maturities, long-term debt | $ | — | $ | 13,810 | ||||
Long-term debt, net | 303,080 | 360,840 | ||||||
Total Debt | 303,080 | 374,650 | ||||||
Less: Cash and cash equivalents | 27,580 | 20,710 | ||||||
Net Debt | $ | 275,500 | $ | 353,940 |
2017 quarterly periods ended | ||||||||||||||||||||
March 31 | June 30 | September 30 | December 31 | Year ended December 31, 2017 | ||||||||||||||||
Energy | ||||||||||||||||||||
Net sales | $ | 40,930 | $ | 43,490 | $ | 40,440 | $ | 36,720 | $ | 161,580 | ||||||||||
Operating profit (loss) | $ | (3,900 | ) | $ | 110 | $ | 1,240 | $ | (2,860 | ) | $ | (5,410 | ) | |||||||
Special Items(1) to consider in evaluating operating profit: | ||||||||||||||||||||
Business restructuring and severance costs | 6,440 | 3,890 | 470 | 3,950 | 14,750 | |||||||||||||||
Excluding Special Items, operating profit would have been | $ | 2,540 | $ | 4,000 | $ | 1,710 | $ | 1,090 | $ | 9,340 | ||||||||||
Engineered Components | ||||||||||||||||||||
Net sales | $ | 32,520 | $ | 33,560 | $ | 30,780 | $ | 30,420 | $ | 127,280 | ||||||||||
Operating profit | $ | 4,980 | $ | 4,710 | $ | 3,310 | $ | 2,740 | $ | 15,740 | ||||||||||
Special Items to consider in evaluating operating profit: | ||||||||||||||||||||
Business restructuring and severance costs | — | — | — | 600 | 600 | |||||||||||||||
Excluding Special Items, operating profit would have been | $ | 4,980 | $ | 4,710 | $ | 3,310 | $ | 3,340 | $ | 16,340 | ||||||||||
Specialty Products | ||||||||||||||||||||
Net sales | $ | 73,450 | $ | 77,050 | $ | 71,220 | $ | 67,140 | $ | 288,860 | ||||||||||
Operating profit | $ | 1,080 | $ | 4,820 | $ | 4,550 | $ | (120 | ) | $ | 10,330 | |||||||||
Special Items to consider in evaluating operating profit: | ||||||||||||||||||||
Business restructuring and severance costs | 6,440 | 3,890 | 470 | 4,550 | 15,350 | |||||||||||||||
Excluding Special Items, operating profit would have been | $ | 7,520 | $ | 8,710 | $ | 5,020 | $ | 4,430 | $ | 25,680 |
2016 quarterly periods ended | ||||||||||||||||||||
March 31 | June 30 | September 30 | December 31 | Year ended December 31, 2016 | ||||||||||||||||
Energy | ||||||||||||||||||||
Net sales | $ | 44,750 | $ | 39,950 | $ | 38,230 | $ | 36,060 | $ | 158,990 | ||||||||||
Operating loss | $ | (3,610 | ) | $ | (3,090 | ) | $ | (1,870 | ) | $ | (5,270 | ) | $ | (13,840 | ) | |||||
Special Items to consider in evaluating operating profit: | ||||||||||||||||||||
Business restructuring and severance costs | 4,700 | 4,890 | 3,640 | 6,230 | 19,460 | |||||||||||||||
Excluding Special Items, operating profit would have been | $ | 1,090 | $ | 1,800 | $ | 1,770 | $ | 960 | $ | 5,620 | ||||||||||
Engineered Components | ||||||||||||||||||||
Net sales | $ | 37,520 | $ | 31,170 | $ | 26,300 | $ | 23,780 | $ | 118,770 | ||||||||||
Operating profit | $ | 5,580 | $ | 3,860 | $ | 3,180 | $ | 2,680 | $ | 15,300 | ||||||||||
Special Items to consider in evaluating operating profit: | ||||||||||||||||||||
Business restructuring and severance costs | 150 | 20 | 230 | 130 | 530 | |||||||||||||||
Excluding Special Items, operating profit would have been | $ | 5,730 | $ | 3,880 | $ | 3,410 | $ | 2,810 | $ | 15,830 | ||||||||||
Specialty Products | ||||||||||||||||||||
Net sales | $ | 82,270 | $ | 71,120 | $ | 64,530 | $ | 59,840 | $ | 277,760 | ||||||||||
Operating profit (loss) | $ | 1,970 | $ | 770 | $ | 1,310 | $ | (2,590 | ) | $ | 1,460 | |||||||||
Special Items to consider in evaluating operating profit: | ||||||||||||||||||||
Business restructuring and severance costs | 4,850 | 4,910 | 3,870 | 6,360 | 19,990 | |||||||||||||||
Excluding Special Items, operating profit would have been | $ | 6,820 | $ | 5,680 | $ | 5,180 | $ | 3,770 | $ | 21,450 |
Year ended December 31, 2015 | ||||
Energy | ||||
Net sales | $ | 193,390 | ||
Operating loss | $ | (97,160 | ) | |
Special Items to consider in evaluating operating profit: | ||||
Business restructuring and severance costs | 23,140 | |||
Impairment of goodwill and indefinite-lived intangible assets | 72,500 | |||
Excluding Special Items, operating loss would have been | $ | (1,520 | ) | |
Engineered Components | ||||
Net sales | $ | 159,840 | ||
Operating profit | $ | 18,240 | ||
Special Items to consider in evaluating operating profit: | ||||
Business restructuring and severance costs | 280 | |||
Impairment of goodwill and indefinite-lived intangible assets | 3,180 | |||
Excluding Special Items, operating profit would have been | $ | 21,700 | ||
Specialty Products | ||||
Net sales | $ | 353,230 | ||
Operating loss | $ | (78,920 | ) | |
Special Items to consider in evaluating operating profit: | ||||
Business restructuring and severance costs | 23,420 | |||
Impairment of goodwill and indefinite-lived intangible assets | 75,680 | |||
Excluding Special Items, operating profit would have been | $ | 20,180 |