NEW ALBANY, Ohio,
March 13, 2017 /PRNewswire/ -- Commercial Vehicle Group,
Inc. (the "Company" and "CVG") (Nasdaq: CVGI) today announced its
intention to refinance the Company's $235
million 7.875% notes due April
2019 (the "7.875% notes") with an institutional term loan;
more specifically, a $175 million
Term Loan B facility, and the remainder being redeemed with
approximately $60 million of cash on
the balance sheet. The Company expects to close the
refinancing after the redemption premium on the 7.875% notes steps
down to zero in April of this year.
In conjunction with our intention to refinance the debt and the
timing thereof, the Company is providing projections of selected
preliminary expected results for the three months ending
March 31, 2017, as indicated
below:
- Revenues are estimated at $157.0 -
$167.0 million.
- Operating Income is estimated at $3.8 -
$4.4 million.
- Adjusted EBITDA is estimated at $8.5 -
$9.3 million.
(See Appendix A for Reconciliation of GAAP to Non-GAAP
Financial Measures)
The Company does not intend to provide projections of selected
preliminary expected results in the future.
Tim Trenary, Chief Financial
Officer, stated, "The Company's continuing operational and
restructuring efforts and focus on managing down selling, general
and administrative costs has allowed us to protect our margins
during a cyclical decline of sales. Furthermore, cash on the
balance sheet has grown to $130
million at December 31,
2016. This financial performance, taken together with the
favorable credit markets at this time, is an opportunity for the
Company to refinance its 7.875% notes. We also intend to
upsize our ABL facility to $65
million in conjunction with the refinancing of the
notes. Pro forma for the expected refinancing, cash on the
balance sheet will approximate $65
million and debt will be $175
million. We believe this reduced debt obligation and
corresponding reduction in interest expense will improve the
Company's earnings."
This press release does not constitute an offer or solicitation
of an offer to purchase a security.
GAAP to Non-GAAP Reconciliation
A reconciliation of
GAAP to non-GAAP financial measures referenced in this release is
included as Appendix A to this release.
About Commercial Vehicle Group, Inc.
Commercial
Vehicle Group, Inc. (and its subsidiaries) is a leading supplier of
a full range of cab related products and systems for the global
commercial vehicle market, including the medium- and heavy-duty
truck market, the medium-and heavy-construction vehicle markets,
the military, bus, agriculture, specialty transportation, mining,
industrial equipment and off-road recreational (ATV/UTV)
markets. Information about the Company and its products
is available on the internet at www.cvgrp.com.
Forward-Looking Statements
This press release contains
forward-looking statements that are subject to risks and
uncertainties. These statements often include words such as
"believe," "expect," "anticipate," "intend," "plan," "estimate," or
similar expressions. In particular, this press release may
contain forward-looking statements about Company expectations for
future periods with respect to its plans to improve financial
results and enhance the Company, the future of the Company's end
markets, Class 8 North America build rates, performance of
the global construction equipment business, expected cost savings,
enhanced shareholder value and other economic benefits of the
consulting services, the Company's initiatives to address customer
needs, organic growth, the Company's economic growth plans to focus
on certain segments and markets and the Company's financial
position or other financial information. These statements are
based on certain assumptions that the Company has made in light of
its experience in the industry as well as its perspective on
historical trends, current conditions, expected future developments
and other factors it believes are appropriate under the
circumstances. Actual results may differ materially from the
anticipated results because of certain risks and uncertainties,
including but not limited to: (i) general economic or business
conditions affecting the markets in which the Company serves; (ii)
the Company's ability to develop or successfully introduce new
products; (iii) risks associated with conducting business in
foreign countries and currencies; (iv) increased competition in the
heavy-duty truck, construction, aftermarket, military, bus,
agriculture and other markets; (v) the Company's failure to
complete or successfully integrate strategic acquisitions; (vi) the
impact of changes in governmental regulations on the Company's
customers or on its business; (vii) the loss of business from a
major customer or the discontinuation of particular commercial
vehicle platforms; (viii) the Company's ability to obtain future
financing due to changes in the lending markets or its financial
position; (ix) the Company's ability to comply with the financial
covenants in its revolving credit facility; (x) the Company's
ability to realize the benefits of its cost reduction and strategic
initiatives; (xi) a material weakness in our internal control
over financial reporting which could, if not remediated, result in
material misstatements in our financial statements; (xii)
volatility and cyclicality in the commercial vehicle market
adversely affecting us; (xiii) the geographic profile of our
taxable income and changes in valuation of our deferred tax assets
and liabilities impacting our effective tax rate; (xiv) changes to
domestic manufacturing initiatives impacting our effective tax rate
related to products manufactured either in the United States or in international
jurisdictions; (xv) implementation of tax changes, by the United States or another international
jurisdiction, related to products manufactured in one or more
jurisdictions where we do business; and (xvi) various other risks
as outlined under the heading "Risk Factors" in the Company's
Annual Report on Form 10-K for fiscal year ending December 31, 2016. There can be no assurance that
statements made in this press release relating to future events
will be achieved. The Company undertakes no obligation to
update or revise forward-looking statements to reflect changed
assumptions, the occurrence of unanticipated events or changes to
future operating results over time. All subsequent written
and oral forward-looking statements attributable to the Company or
persons acting on behalf of the Company are expressly qualified in
their entirety by such cautionary statements.
COMMERCIAL VEHICLE
GROUP, INC. AND SUBSIDIARIES
Appendix A:
Reconciliation of GAAP to Non-GAAP
Financial Measures (Unaudited)
(Amounts in
millions)
|
|
|
|
|
|
|
|
Three Months Ended
March 31,
|
|
2017 - Estimated
Range
|
|
Low
|
High
|
Sales
|
$
157.0
|
$
167.0
|
|
|
|
Operating
Income
|
3.8
|
4.4
|
|
|
|
Restructuring
1
|
0.8
|
1.0
|
|
|
|
Adjusted Operating
Income
|
4.6
|
5.4
|
|
|
|
Depreciation
Expense
|
3.6
|
3.6
|
Amortization
Expense
|
0.3
|
0.3
|
Adjusted
EBITDA
|
$
8.5
|
$
9.3
|
|
|
|
|
|
1 Costs
associated with restructuring, including employee severance and
retention costs, lease cancellation costs, building repairs and
costs to transfer equipment.
|
|
|
|
|
|
Use of Non-GAAP Measures
This earnings release contains financial measures that are not
calculated in accordance with U.S. generally accepted accounting
principles ("GAAP"). In general, the non-GAAP measures exclude
items and charges that (i) management believes reflect the
Company's multi-year corporate activities; or (ii) relate to
activities or actions that may have occurred over multiple or in
prior periods without predictable trends. Management uses these
non-GAAP financial measures internally to evaluate the Company's
performance, engage in financial and operational planning and to
determine incentive compensation.
Management provides these non-GAAP financial measures to
investors as supplemental metrics to assist readers in assessing
the effects of items and events on the Company's financial and
operating results and in comparing the Company's performance to
that of its competitors and comparable reporting periods. However,
the non-GAAP financial measures used by the Company may be
calculated differently from, and therefore may not be comparable
to, similarly titled measures used by other companies.
The non-GAAP financial measures disclosed by the Company should
not be considered a substitute for, or superior to, financial
measures calculated in accordance with GAAP, and the financial
results calculated in accordance with GAAP and reconciliations to
those financial statements set forth above should be carefully
evaluated.
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SOURCE Commercial Vehicle Group, Inc.