8-K

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

Date of Report (Date of earliest event reported): March 19, 2014

SL Industries, Inc.
(Exact name of registrant as specified in its charter)
Delaware	1-4987	21-0682685
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
520 Fellowship Road, Suite A114, Mount Laurel, New Jersey		08054
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (856) 727-1500

N/A

(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 (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ 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 March 19, 2014, SL Industries, Inc. (the “Company”) announced its financial results for the fourth quarter and fiscal year ended December 31, 2013.  A copy of the press release is furnished as Exhibit 99.1 to this report.

The information furnished pursuant to this Item 2.02 of this Current Report on Form 8-K, including the exhibit hereto, shall not be considered “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of such section, and shall not be incorporated by reference into future filings by the Company under the Securities Act of 1933, as amended, or under the Securities Exchange Act of 1934, as amended, unless the Company expressly sets forth in such future filing that such information is to be considered “filed” or incorporated by reference therein.

Item 9.01.Financial Statements and Exhibits.

(c)           Exhibits

Exhibit No. Exhibits

99.1 Press Release dated March 19, 2014.

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.

	SL Industries, Inc.
	(Registrant)
Date:  March 21, 2014
	By:	/s/ Louis J. Belardi
		Name:	Louis J. Belardi
		Title:	Chief Financial Officer

 

EX-99.1

Exhiit 99.1

For Immediate Release

SL Industries Announces 2013 Full Year and Fourth Quarter Results

MT. LAUREL, NEW JERSEY, March 19, 2014 . . . SL INDUSTRIES, INC. (NYSE MKT: SLI); (“SLI” or the “Company”) operating results for the fourth quarter and year ended December 31, 2013 are summarized in the following paragraphs. Please read the Company's Form 10-K, which can be found at www.slindustries.com, for a full discussion of the operating results.

Fourth Quarter Results

Net sales for the quarter ended December 31, 2013 were $52.8 million compared with net sales for the quarter ended December 31, 2012 of $51.5 million.

Income from continuing operations for the quarter ended December 31, 2013 was $0.7 million, or $0.16 per diluted share, compared to income from continuing operations of $3.6 million, or $0.87 per diluted share, for the quarter ended December 31, 2012. Income from continuing operations for the quarter ended December 31, 2013 included a $5.1 million ($3.2 million, net of tax) non-cash goodwill impairment charge related to the TEAL reporting unit, which is part of the High Power Group segment. The goodwill impairment charge affected earnings by $0.76 per diluted share.

Net income for the quarter ended December 31, 2013 was $0.3 million, or $0.07 per diluted share, compared to net income of $3.0 million, or $0.71 per diluted share, for the quarter ended December 31, 2012. Net income for the quarter ended December 31, 2013 included a net loss from discontinued operations of $0.4 million, or $0.09 per diluted share, compared to a net loss from discontinued operations of $0.7 million, or $0.16 per diluted share, for the fourth quarter of 2012.

The Company generated EBITDA from continuing operations of $1.7 million for the fourth quarter of 2013, as compared to $5.5 million for the same period in 2012, a decrease of $3.8 million, or 69%. Without the $5.1 million non-cash impairment charge mentioned above EBITDA would have increased by $1.3 million or 24%. The Company generated Adjusted EBITDA from continuing operations of $6.7 million for the fourth quarter of 2013, compared to $5.3 million for the same period in 2012, an increase of $1.4 million, or 26%.  See “Note Regarding Use of Non-GAAP Financial Measurements” below for the definitions of EBITDA and Adjusted EBITDA.

Full Year Results

Net sales for the year ended December 31, 2013 were $204.7 million compared with net sales for the year ended December 31, 2012 of $200.6 million.

Income from continuing operations for the year ended December 31, 2013 was $9.3 million, or $2.23 per diluted share, compared to income from continuing operations of $9.4 million, or $2.16 per diluted share, for the year ended December 31, 2012. Income from continuing operations for the year ended December 31, 2013 included a $5.1 million ($3.2 million, net of tax) non-cash goodwill impairment charge previously mentioned.

Net income for the year ended December 31, 2013 was $8.2 million, or $1.97 per diluted share, compared to net income of $7.8 million, or $1.80 per diluted share, for the year ended December 31, 2012. Net income for the year ended December 31, 2013 included a net loss from discontinued operations of $1.1 million, or $0.26 per diluted share, compared to a net loss from discontinued operations of $1.6 million, or $0.36 per diluted share, for the year ended December 31, 2012.

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The Company generated EBITDA from continuing operations of $15.4 million for the year ended 2013, as compared to $15.9 million for the same period in 2012. Without the $5.1 million non-cash impairment charge EBITDA would have increased by $4.6 million or 29%. The Company generated Adjusted EBITDA from continuing operations of $21.9 million for the year ended 2013, as compared to $18.6 million for the same period in 2012, an increase of $3.3 million, or 18%. See "Note Regarding Use of Non-GAAP Financial Measurements" below for the definition of EBITDA and Adjusted EBITDA.

Guidance 2014

The Company anticipates, based on current information, full-year 2014 net sales, EBITDA, and Adjusted EBITDA from continuing operations in the ranges of $197 million to $241 million, $21.0 million to $26.0 million, and $22.0 million to $27.0 million, respectively. The Company's outlook for the first quarter of 2014 is net sales, EBITDA, and Adjusted EBITDA from continuing operations in the ranges of $49 million to $54 million, $4.6 million to $5.1 million, and $5.4 million to $5.9 million, respectively.

Financial Summary

SUMMARY CONSOLIDATED BALANCE SHEETS
	December 31,		December 31,
	2013		2012
	(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	7,163	$	3,196
Receivables, net		30,765		30,306
Inventories, net		22,963		22,102
Other current assets		9,972		5,513
Total current assets		70,863		61,117
Property, plant and equipment, net		10,790		9,593
Intangible assets, net		20,012		25,405
Other assets and deferred charges, net		11,669		11,022
Total assets	$	113,334	$	107,137
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities	$	33,812	$	34,808
Long-term liabilities		20,347		21,897
Shareholders' equity		59,175		50,432
Total liabilities and shareholders' equity	$	113,334	$	107,137

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CONSOLIDATED STATEMENTS OF INCOME
	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2013			2012			2013			2012
	(In thousands, except per share amounts)
Net sales	$	52,808		$	51,452		$	204,688		$	200,577
Cost and expenses:
Cost of products sold		35,102			35,443			135,837			136,542
Engineering and product development		2,692			2,589			13,054			11,746
Selling, general and administrative		8,757			8,091			35,425			35,820
Depreciation and amortization		613			673			2,406			2,711
Restructuring charges		-			5			-			857
Goodwill impairment		5,055			-			5,055			-
Total cost and expenses		52,219			46,801			191,777			187,676
Income from operations		589			4,651			12,911			12,901
Other income (expense):
Amortization of deferred financing costs		(23	)		(20	)		(83	)		(138	)
Interest income		1			1			12			5
Interest expense		(16	)		(9	)		(87	)		(48	)
Other gain, net		472			160			124			302
Income from continuing operations before income taxes		1,023			4,783			12,877			13,022
Income tax provision		361			1,145			3,545			3,665
Income from continuing operations		662			3,638			9,332			9,357
(Loss) from discontinued operations, net of tax		(355	)		(678	)		(1,092	)		(1,580	)
Net income	$	307		$	2,960		$	8,240		$	7,777
Basic net income (loss) per common share
Income from continuing operations	$	0.16		$	0.88		$	2.25		$	2.17
(Loss) from discontinued operations, net of tax		(0.09	)		(0.16	)		(0.26	)		(0.37	)
Net income	$	0.07		$	0.72		$	1.99		$	1.80
Diluted net income (loss) per common share
Income from continuing operations	$	0.16		$	0.87		$	2.23		$	2.16
(Loss) from discontinued operations, net of tax		(0.09	)		(0.16	)		(0.26	)		(0.36	)
Net income	$	0.07		$	0.71		$	1.97		$	1.80
Shares used in computing basic net income (loss)
per common share		4,123			4,130			4,138			4,313
Shares used in computing diluted net income (loss)
per common share		4,165			4,152			4,184			4,330

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
	Three Months Ended					Twelve Months Ended
	December 31,					December 31,
	2013		2012			2013		2012
	(In thousands)
Net income	$	307	$	2,960		$	8,240	$	7,777
Other comprehensive income, net of tax:
Foreign currency translation		65		(37	)		180		(103	)
Net unrealized gain on available-for-sale securities		889		-			1,094		-
Comprehensive income	$	1,261	$	2,923		$	9,514	$	7,674

Segment Results

	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2013			2012			2013			2012
	(In thousands)
Net sales
SLPE	$	19,827		$	19,508		$	78,177		$	77,869
High Power Group		17,656			18,192			68,752			65,283
SL-MTI		10,161			8,057			37,729			36,223
RFL		5,164			5,695			20,030			21,202
Net sales		52,808			51,452			204,688			200,577
Income from operations
SLPE		2,262			1,075			6,558			2,487
High Power Group		(3,390	)		2,373			2,206			6,822
SL-MTI		2,440			1,273			7,202			6,292
RFL		577			974			2,676			2,763
Unallocated Corporate Expenses		(1,300	)		(1,044	)		(5,731	)		(5,463	)
Income from operations		589			4,651			12,911			12,901
Other income (expense):
Amortization of deferred financing costs		(23	)		(20	)		(83	)		(138	)
Interest income		1			1			12			5
Interest expense		(16	)		(9	)		(87	)		(48	)
Other gain, net		472			160			124			302
Income from continuing operations before income taxes	$	1,023		$	4,783		$	12,877		$	13,022

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Supplemental Non-GAAP Disclosures

EBITDA and Adjusted EBITDA

	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2013			2012			2013			2012
	(In thousands)
Income from continuing operations, net of tax	$	662		$	3,638		$	9,332		$	9,357
Add (deduct):
Interest income		(1	)		(1	)		(12	)		(5	)
Interest expense		16			9			87			48
Income tax provision		361			1,145			3,545			3,665
Depreciation and amortization		613			673			2,406			2,711
Amortization of deferred financing costs		23			20			83			138
EBITDA from continuing operations		1,674			5,484			15,441			15,914
Goodwill impairment		5,055			-			5,055			-
China work stoppage costs		13			-			675			-
Non-cash stock-based compensation expense		99			(67	)		545			842
Environmental regulatory change		97			-			97			-
Unrealized (gain) loss on foreign exchange contracts		(258	)		(101	)		90			(243	)
Restructuring costs		-			5			-			857
China investigation costs		-			8			-			844
Direct acquisition costs		-			2			-			434
Gain on sale of investment		-			(59	)		-			(59	)
Adjusted EBITDA from continuing operations	$	6,680		$	5,272		$	21,903		$	18,589

Note Regarding Use of Non-GAAP Financial Measurements

The financial data contained in this press release includes certain non-GAAP financial measures as defined by the Securities and Exchange Commission (“SEC”), including “EBITDA” and “Adjusted EBITDA”.  The Company is presenting EBITDA and Adjusted EBITDA because it believes that it provides useful information to investors about SLI, its business and its financial condition. The Company defines EBITDA as net income from continuing operations before the effects of interest income, interest expense, income taxes, depreciation and amortization, and the amortization of deferred financing costs. The Company defines Adjusted EBITDA as EBITDA before the effects of certain items, including non-cash goodwill impairment expense, China work stoppage costs, non-cash stock-based compensation expense, costs associated with an environmental regulatory change, unrealized (gain) loss on foreign exchange contracts, restructuring costs, China investigation costs, direct acquisition costs, and gain on sale of investment. The Company believes EBITDA and Adjusted EBITDA are useful to investors because they are key measures used by the Company's Board of Directors and management to evaluate its business, including internal management reporting, budgeting and forecasting processes, in comparing operating results across the business, as an internal profitability measure, as a component in evaluating the ability and the desirability of making capital expenditures and significant acquisitions, and as an element in determining executive compensation.

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However, EBITDA and Adjusted EBITDA are not measures of financial performance under generally accepted accounting principles in the United States of America (“GAAP”), and the items excluded from EBITDA and Adjusted EBITDA are significant components in understanding and assessing financial performance. Therefore, EBITDA and Adjusted EBITDA should not be considered a substitute for net income (loss) or cash flows from operating, investing, or financing activities. Because EBITDA and Adjusted EBITDA are calculated before recurring cash items, including interest income, interest expense, and income taxes, and is not adjusted for capital expenditures or other recurring cash requirements of the business, it should not be considered as a measure of discretionary cash available to invest in the growth of the business. There are a number of material limitations to the use of EBITDA and Adjusted EBITDA as an analytical tool, including the following:

·   EBITDA and Adjusted EBITDA do not reflect the Company's interest income and interest expense;

·   EBITDA and Adjusted EBITDA do not reflect the Company's income tax expense or the cash requirements to pay its income taxes;

·   Although depreciation and amortization are non-cash expenses in the period recorded, the assets being depreciated and amortized may have to be replaced in the future, and EBITDA and Adjusted EBITDA do not reflect the cash requirements for such replacement;

·   EBITDA and Adjusted EBITDA do not include the amortization of deferred financing costs;

·   EBITDA and Adjusted EBITDA do not include discontinued operations;

·   Adjusted EBITDA does not include non-cash charges for goodwill impairment;

·   Adjusted EBITDA does not include work stoppage costs;

·   Adjusted EBITDA does not include non-cash charges for stock-based compensation;

·   Adjusted EBITDA does not include environmental regulatory change costs from continuing operations;

·   Adjusted EBITDA does not include (gain) loss, realized or unrealized, on foreign exchange contracts;

·   Adjusted EBITDA does not include restructuring charges;

·   Adjusted EBITDA does not include investigation and acquisition costs;

·   Adjusted EBITDA does not include gain on sale of investment.

The Company compensates for these limitations by relying primarily on its GAAP financial measures and by using EBITDA and Adjusted EBITDA only as supplemental information. The Company believes that consideration of EBITDA and Adjusted EBITDA, together with a careful review of its GAAP financial measures, is the most informed method of analyzing SLI.

The Company reconciles EBITDA and Adjusted EBITDA to net income from continuing operations, and that reconciliation is set forth above.  Because EBITDA and Adjusted EBITDA are not a measurement determined in accordance with GAAP and is susceptible to varying calculations, EBITDA and Adjusted EBITDA, as presented, may not be comparable to other similarly titled measures of other companies. Net sales and expenses are measured in accordance with the policies and procedures described in the Company's Annual Report on Form 10-K for the year ended December 31, 2013.

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About SL Industries, Inc.

SL Industries, Inc., designs, manufactures and markets power electronics, motion control, power protection, power quality electromagnetic and specialized communication equipment that is used in a variety of medical, commercial and military aerospace, solar, computer, datacom, industrial, telecom, transportation, utility, rail and highway equipment applications. For more information about SL Industries, Inc. and its products, please visit the Company’s web site at www.slindustries.com.

Forward-Looking Statements

This press release contains certain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that reflect SLI's current expectations and projections about its future results, performance, prospects, and opportunities. SLI has tried to identify these forward-looking statements by using words such as "may," "should," "expect," "hope," "anticipate," "believe," "intend," "plan," "estimate," and similar expressions. These forward-looking statements are based on information currently available to the Company and are subject to a number of risks, uncertainties, and other factors that could cause its actual results, performance, prospects, or opportunities in 2014 and beyond to differ materially from those expressed in, or implied by, these forward-looking statements. These factors include, without limitation: the effectiveness of the cost reduction initiatives undertaken by the Company, changes in demand for the Company's products, product mix, the timing of customer orders and deliveries, the impact of competitive products and pricing, constraints on supplies of critical components, excess or shortage of production capacity, difficulties encountered in the integration of acquired businesses and other risks discussed from time to time in the Company's Securities and Exchange Commission filings and reports.  In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic and international economic conditions. Although SLI believes that the expectations reflected in these forward-looking statements are reasonable and achievable, such statements involve significant risks and uncertainties, and no assurance can be given that the actual results will be consistent with these forward-looking statements. Except as otherwise required by Federal securities laws, SLI undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, changed circumstances, or any other reason.

Contact

SL Industries, Inc.

Louis J. Belardi

Chief Financial Officer

E-mail:  louis.belardi@slindustries.com

Phone:  856.727.1500  x 5525

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