NORTH CANTON, Ohio,
Oct. 30, 2019 /PRNewswire/ -- The
Timken Company (NYSE: TKR; www.timken.com), a world leader in
engineered bearings and power transmission products, today
reported third-quarter 2019 sales of $914 million, up 3.7
percent from the same period a year ago. The increase was primarily
driven by the benefit of acquisitions, partially offset by lower
organic revenue mainly in Mobile Industries, and unfavorable
foreign currency translation.
In the third quarter, Timken posted net income of $64.2
million or $0.84 per diluted share, versus net income
of $71.6 million or $0.91 per diluted share for
the same period a year ago. The year-over-year decrease was
primarily driven by pension and other retirement plan remeasurement
charges and higher income tax expense, partially offset by improved
overall operating performance.
Excluding special items (detailed in the attached tables),
adjusted net income in the third quarter of 2019 was $87.4
million or $1.14 per diluted
share, a record for the third quarter, versus adjusted net income
of $82.9 million
or $1.06 per diluted share for the same period in 2018.
The year-over-year increase was driven by favorable price/mix,
lower material and logistics costs and the benefit of acquisitions,
partially offset by the impact of lower volume and related
manufacturing utilization, and higher interest expense.
Cash from operations for the quarter was $144.9 million, and free cash flow was
$101.2 million. During the quarter,
the company returned $53.7 million of
capital to shareholders with the payment of its 389th consecutive
quarterly dividend and the repurchase of approximately 750 thousand
shares. Also, among recent developments, the company announced an
agreement to acquire BEKA Lubrication, a leading global supplier of
automatic lubrication systems, which will strengthen Timken's
leadership position in this attractive product line.
"Timken delivered strong operating performance in the third
quarter," said Richard G. Kyle,
president and chief executive officer. "While several industrial
markets were softer than anticipated, we delivered record earnings
per share, strong operating margins and excellent cash flow.
Delivering record results in this environment demonstrates that we
are successfully executing our strategy. We continue to drive
outgrowth in sectors such as renewable energy and rail, deliver
revenue and earnings growth through our acquisitions, and take
proactive measures to reduce costs and improve our operating
efficiency. Our performance in the third quarter is a reflection of
the stronger, more diverse Timken Company."
Third-Quarter 2019 Segment Results
Mobile Industries sales of $455.1 million decreased
2 percent compared with the same period a year ago. The decrease
was driven primarily by lower shipments in off-highway and heavy
truck, and unfavorable currency, partially offset by the benefit of
acquisitions and growth in the rail sector.
Earnings before interest and taxes (EBIT) in the quarter
were $52 million or 11.4 percent of sales,
compared with EBIT of $50.6 million or 10.9 percent
of sales for the same period a year ago. The increase in EBIT
reflects favorable price/mix, lower material and logistics costs
and the benefit of acquisitions, partially offset by the impact of
lower volume and related manufacturing utilization.
Excluding special items (detailed in the attached tables),
adjusted EBIT in the quarter was $53.8 million
or 11.8 percent of sales, compared
with $52.5 million or 11.3 percent of sales in the
third quarter last year.
Process Industries reported sales
of $458.9 million, up 10 percent from the same period a
year ago. The increase was driven primarily by the benefit of
acquisitions and organic growth in the renewable energy and marine
sectors, partially offset by lower revenue in industrial services
and unfavorable currency.
EBIT for the quarter was $95.6 million
or 20.8 percent of sales, compared with EBIT
of $81.8 million or 19.6 percent of sales for the
same period a year ago. The increase in EBIT was driven primarily
by favorable price/mix and the benefit of acquisitions, partially
offset by lower volume.
Excluding special items (detailed in the attached tables),
adjusted EBIT in the quarter was $98.3 million or 21.4
percent of sales, compared with $84 million or 20.1
percent of sales in the third quarter last year.
2019 Outlook
The company now expects 2019 revenue to be up approximately 5 to
6 percent in total versus 2018. This reflects the benefit of
acquisitions, partially offset by unfavorable currency translation.
Organic revenue is expected to be roughly flat overall.
"While we are taking a cautious view with respect to the fourth
quarter, we remain confident in the long-term outlook for the
company," said Kyle. "Our expected record performance in 2019
demonstrates our earnings power in a slowing industrial market
environment, the enduring strength of our portfolio, and our
ability to navigate and deliver through industrial cycles. We look
forward to updating investors on our strategy and longer-term
outlook at our upcoming investor day in December."
Timken now anticipates strong 2019 earnings per diluted share in
the range of $4.15 to $4.20 for the full year on a GAAP basis.
Excluding special items (detailed in the attached tables), the
company expects record 2019 adjusted earnings per diluted share
ranging from $4.70 to $4.75.
Conference Call Information
Timken will host a conference call tomorrow at 9 a.m.
Eastern Time to review its financial results. Presentation
materials will be available online in advance of the call for
interested investors and securities analysts.
Conference
Call:
|
Thursday, Oct. 31,
2019
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9:00 a.m. Eastern
Time
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Live Dial-In:
800-239-9838
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or
323-794-2551
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(Call in 10 minutes
prior to be included.)
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Conference ID:
Timken's 3Q Earnings Call
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Conference Call
Replay:
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Replay Dial-In
available through
|
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Nov. 14,
2019:
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888-203-1112 or
719-457-0820
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Replay Passcode:
7778692
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Live
Webcast:
|
http://investors.timken.com
|
About The Timken Company
The Timken Company (NYSE: TKR; www.timken.com) designs
a growing portfolio of engineered bearings and power transmission
products. With more than a century of knowledge and innovation, we
continuously improve the reliability and efficiency of global
machinery and equipment to move the world forward. Timken
posted $3.6 billion in sales in 2018
and employs more than 18,000 people globally, operating from 35
countries.
Certain statements in this release (including statements
regarding the company's forecasts, estimates, plans and
expectations) that are not historical in nature are
"forward-looking" statements within the meaning of the Private
Securities Litigation Reform Act of 1995. In particular, the
statements related to expectations regarding the company's future
financial performance, including information under the heading 2019
"Outlook," are forward-looking.
The company cautions that actual results may differ
materially from those projected or implied in forward-looking
statements due to a variety of important factors, including: the
finalization of the company's financial statements for the third
quarter of 2019; the company's ability to respond to the changes in
its end markets that could affect demand for the company's
products; unanticipated changes in business relationships with
customers or their purchases from the company; changes in the
financial health of the company's customers, which may have an
impact on the company's revenues, earnings and impairment charges;
fluctuations in material and energy costs; the impact of changes to
the company's accounting methods; recent world events that have
increased the risks posed by international trade disputes, tariffs
and sanctions; weakness in global or regional
economic conditions and capital markets; the company's ability to
satisfy its obligations under its debt agreements and renew or
refinance borrowings on favorable terms; fluctuations in currency
valuations; changes in the expected costs associated with product
warranty claims; the ability to achieve satisfactory operating
results in the integration of acquired companies, including
realizing any accretion within expected timeframes or at all; the
impact on operations of general economic conditions; fluctuations
in customer demand; the impact on the company's pension obligations
and assets due to changes in interest rates, investment performance
and other tactics designed to reduce risk; and the company's
ability to complete and achieve the benefits of announced plans,
programs, initiatives, acquisitions and capital investments.
Additional factors are discussed in the company's filings with the
Securities and Exchange Commission, including the company's Annual
Report on Form 10-K for the year ended Dec.
31, 2018, quarterly reports on Form 10-Q and current reports
on Form 8-K. Except as required by the federal securities laws, the
company undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
Media Relations:
Scott
Schroeder
234.262.6420
scott.schroeder@timken.com
Investor Relations:
Jason
Hershiser
234.262.7101
jason.hershiser@timken.com
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|
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|
|
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The Timken
Company
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
(Dollars in millions,
except per share data)
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2019
|
2018
|
|
2019
|
2018
|
|
|
|
|
|
|
Net sales
|
$
|
914.0
|
|
$
|
881.3
|
|
|
$
|
2,893.7
|
|
$
|
2,670.7
|
|
Cost of products
sold
|
636.5
|
|
628.0
|
|
|
2,007.9
|
|
1,885.1
|
|
Gross
Profit
|
277.5
|
|
253.3
|
|
|
885.8
|
|
785.6
|
|
Selling, general
& administrative expenses
|
148.0
|
|
142.0
|
|
|
459.4
|
|
432.4
|
|
Impairment and
restructuring charges
|
1.6
|
|
2.6
|
|
|
3.5
|
|
3.1
|
|
Operating
Income
|
127.9
|
|
108.7
|
|
|
422.9
|
|
350.1
|
|
Non-service pension
and other postretirement (expense) income
|
(14.4)
|
|
(3.2)
|
|
|
(14.1)
|
|
2.5
|
|
Other income,
net
|
5.8
|
|
3.7
|
|
|
10.5
|
|
7.3
|
|
Earnings Before
Interest and Taxes (EBIT) (1)
|
119.3
|
|
109.2
|
|
|
419.3
|
|
359.9
|
|
Interest expense,
net
|
(17.1)
|
|
(11.9)
|
|
|
(52.0)
|
|
(31.7)
|
|
Income Before
Income Taxes
|
102.2
|
|
97.3
|
|
|
367.3
|
|
328.2
|
|
Provision for income
taxes
|
35.5
|
|
25.0
|
|
|
110.4
|
|
83.5
|
|
Net
Income
|
66.7
|
|
72.3
|
|
|
256.9
|
|
244.7
|
|
Less: Net income
attributable to noncontrolling interest
|
2.5
|
|
0.7
|
|
|
8.3
|
|
1.9
|
|
Net Income
Attributable to The Timken Company
|
$
|
64.2
|
|
$
|
71.6
|
|
|
$
|
248.6
|
|
$
|
242.8
|
|
Net Income per
Common Share Attributable to The Timken Company Common
Shareholders
|
|
|
|
|
|
Basic
Earnings per share
|
$
|
0.85
|
|
$
|
0.93
|
|
|
$
|
3.28
|
|
$
|
3.14
|
|
|
|
|
|
|
|
Diluted
Earnings per share
|
$
|
0.84
|
|
$
|
0.91
|
|
|
$
|
3.23
|
|
$
|
3.09
|
|
|
|
|
|
|
|
Average Shares
Outstanding
|
75,628,410
|
|
76,903,395
|
|
|
75,864,544
|
|
77,332,209
|
|
Average Shares
Outstanding - assuming dilution
|
76,592,694
|
|
78,428,105
|
|
|
76,902,426
|
|
78,645,503
|
|
|
|
|
|
|
|
(1) EBIT is a non-GAAP measure
defined as operating income plus other income (expense). EBIT is an
important financial measure used in the management of the business,
including decisions concerning the allocation of resources and
assessment of performance. Management believes that reporting EBIT
is useful to investors as this measure is representative of the
Company's core operations.
|
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|
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|
|
|
|
|
|
BUSINESS
SEGMENTS
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
(Dollars in
millions)
|
2019
|
2018
|
|
2019
|
2018
|
|
|
|
|
|
|
Mobile
Industries
|
|
|
|
|
|
Net sales
|
$
|
455.1
|
|
$
|
464.2
|
|
|
$
|
1,448.8
|
|
$
|
1,441.8
|
|
Earnings before
interest and taxes (EBIT) (1)
|
$
|
52.0
|
|
$
|
50.6
|
|
|
$
|
172.5
|
|
$
|
156.2
|
|
EBIT Margin
(1)
|
11.4
|
%
|
10.9
|
%
|
|
11.9
|
%
|
10.8
|
%
|
Process
Industries
|
|
|
|
|
|
Net sales
|
$
|
458.9
|
|
$
|
417.1
|
|
|
$
|
1,444.9
|
|
$
|
1,228.9
|
|
Earnings before
interest and taxes (EBIT) (1)
|
$
|
95.6
|
|
$
|
81.8
|
|
|
$
|
304.8
|
|
$
|
254.0
|
|
EBIT Margin
(1)
|
20.8
|
%
|
19.6
|
%
|
|
21.1
|
%
|
20.7
|
%
|
Corporate
expense
|
$
|
(11.4)
|
|
$
|
(17.9)
|
|
|
$
|
(41.1)
|
|
$
|
(47.2)
|
|
Corporate pension and
other postretirement benefit related charges
(2)
|
(16.9)
|
|
(5.3)
|
|
|
(16.9)
|
|
(3.1)
|
|
|
|
|
|
|
|
Consolidated
|
|
|
|
|
|
Net sales
|
$
|
914.0
|
|
$
|
881.3
|
|
|
$
|
2,893.7
|
|
$
|
2,670.7
|
|
Earnings before
interest and taxes (EBIT) (1)
|
$
|
119.3
|
|
$
|
109.2
|
|
|
$
|
419.3
|
|
$
|
359.9
|
|
EBIT
Margin (1)
|
13.1
|
%
|
12.4
|
%
|
|
14.5
|
%
|
13.5
|
%
|
|
|
|
|
|
|
(1) EBIT
is a non-GAAP measure defined as operating income plus other income
(expense). EBIT Margin is a non-GAAP measure defined as EBIT as a
percentage of net sales. EBIT and EBIT Margin are important
financial measures used in the management of the business,
including decisions concerning the allocation of resources and
assessment of performance. Management believes that reporting
EBIT and EBIT Margin is useful to investors as these measures are
representative of the core operations of the segments and Company,
respectively.
|
|
|
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|
(2) Corporate pension and other
postretirement benefit related charges represent actuarial (gains)
and losses that resulted from the remeasurement of plan assets and
obligations as a result of changes in assumptions. The Company
recognizes actuarial (gains) and losses in connection with the
annual remeasurement in the fourth quarter, or if specific events
trigger a remeasurement. Refer to the Retirement Benefit Plans and
Other Postretirement Benefit Plans footnotes within the third
quarter 2019 Form 10-Q for additional discussion.
|
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
|
(Dollars in
millions)
|
(Unaudited)
|
|
|
|
September 30,
2019
|
|
December 31,
2018
|
ASSETS
|
|
|
|
Cash, cash
equivalents and restricted cash
|
$
|
181.9
|
|
|
$
|
133.1
|
|
Accounts receivable,
net
|
548.3
|
|
|
546.6
|
|
Unbilled
receivables
|
151.6
|
|
|
116.6
|
|
Inventories,
net
|
805.3
|
|
|
835.7
|
|
Other current
assets
|
120.3
|
|
|
105.2
|
|
Total Current
Assets
|
1,807.4
|
|
|
1,737.2
|
|
Property, plant and
equipment, net
|
906.8
|
|
|
912.1
|
|
Operating lease
assets (1)
|
115.0
|
|
|
—
|
|
Goodwill and other
intangible assets
|
1,657.5
|
|
|
1,693.7
|
|
Non-current pension
assets
|
11.8
|
|
|
6.2
|
|
Non-current other
postretirement benefit assets
|
23.5
|
|
|
—
|
|
Other
assets
|
43.3
|
|
|
96.0
|
|
Total
Assets
|
$
|
4,565.3
|
|
|
$
|
4,445.2
|
|
LIABILITIES
|
|
|
|
Accounts
payable
|
$
|
265.2
|
|
|
$
|
273.2
|
|
Short-term debt,
including current portion of long-term debt
|
96.6
|
|
|
43.0
|
|
Short-term operating
lease liabilities (1)
|
28.0
|
|
|
—
|
|
Income
taxes
|
23.2
|
|
|
23.5
|
|
Accrued
expenses
|
291.6
|
|
|
345.9
|
|
Total Current
Liabilities
|
704.6
|
|
|
685.6
|
|
Long-term
debt
|
1,553.5
|
|
|
1,638.6
|
|
Accrued pension
benefits
|
167.8
|
|
|
161.3
|
|
Accrued
postretirement benefits
|
36.9
|
|
|
108.7
|
|
Long-term operating
lease liabilities (1)
|
72.3
|
|
|
—
|
|
Other non-current
liabilities
|
212.7
|
|
|
208.3
|
|
Total
Liabilities
|
2,747.8
|
|
|
2,802.5
|
|
EQUITY
|
|
|
|
The Timken Company
shareholders' equity
|
1,744.8
|
|
|
1,579.6
|
|
Noncontrolling
Interest
|
72.7
|
|
|
63.1
|
|
Total
Equity
|
1,817.5
|
|
|
1,642.7
|
|
Total Liabilities and
Equity
|
$
|
4,565.3
|
|
|
$
|
4,445.2
|
|
|
|
|
|
(1) Due to the adoption of the new
leasing standard, the Company recognized operating lease assets and
corresponding operating lease liabilities on the Consolidated
Balance Sheet. In conjunction with the adoption of the new leasing
standard, the Company reclassified $15.3 million of lease assets
related to purchase accounting adjustments from the ABC Bearings
Limited ("ABC Bearings") acquisition from Other assets to Operating
lease assets. These assets do not have material corresponding lease
liabilities.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
September 30,
|
Nine Months
Ended
September 30,
|
(Dollars in
millions)
|
2019
|
2018
|
2019
|
2018
|
Cash Provided by
(Used in)
|
|
|
|
|
OPERATING
ACTIVITIES
|
|
|
|
|
Net Income
|
$
|
66.7
|
|
$
|
72.3
|
|
$
|
256.9
|
|
$
|
244.7
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
39.2
|
|
35.1
|
|
120.4
|
|
105.9
|
|
Stock-based
compensation expense
|
5.8
|
|
7.7
|
|
20.7
|
|
25.5
|
|
Pension and other
postretirement expense
|
17.4
|
|
6.9
|
|
23.2
|
|
8.5
|
|
Pension and other
postretirement benefit contributions and payments
|
(28.2)
|
|
(3.6)
|
|
(37.1)
|
|
(12.4)
|
|
Operating lease
expense
|
9.0
|
|
—
|
|
27.7
|
|
—
|
|
Operating lease
payments
|
(9.1)
|
|
—
|
|
(26.8)
|
|
—
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Accounts
receivable
|
29.5
|
|
20.7
|
|
(6.4)
|
|
(65.7)
|
|
Unbilled
receivables
|
1.6
|
|
(9.8)
|
|
(35.0)
|
|
(37.6)
|
|
Inventories
|
21.2
|
|
(14.4)
|
|
37.8
|
|
(94.3)
|
|
Accounts
payable
|
(20.8)
|
|
(1.5)
|
|
(7.4)
|
|
(9.9)
|
|
Accrued
expenses
|
16.4
|
|
12.6
|
|
(28.7)
|
|
10.2
|
|
Income
taxes
|
8.3
|
|
5.4
|
|
10.7
|
|
1.7
|
|
Other, net
|
(12.1)
|
|
5.8
|
|
(1.2)
|
|
18.4
|
|
Net Cash Provided by
Operating Activities
|
$
|
144.9
|
|
$
|
137.2
|
|
$
|
354.8
|
|
$
|
195.0
|
|
INVESTING
ACTIVITIES
|
|
|
|
|
Capital
expenditures
|
$
|
(43.7)
|
|
$
|
(23.2)
|
|
$
|
(82.9)
|
|
$
|
(62.8)
|
|
Acquisitions, net of
cash received
|
0.3
|
|
(765.4)
|
|
(82.7)
|
|
(765.4)
|
|
Proceeds from
divestitures
|
—
|
|
14.0
|
|
—
|
|
14.0
|
|
Other, net
|
1.0
|
|
0.3
|
|
3.4
|
|
3.9
|
|
Net Cash Used in
Investing Activities
|
$
|
(42.4)
|
|
$
|
(774.3)
|
|
$
|
(162.2)
|
|
$
|
(810.3)
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
Cash dividends paid
to shareholders
|
$
|
(21.2)
|
|
$
|
(21.5)
|
|
$
|
(63.8)
|
|
$
|
(64.2)
|
|
Purchase of treasury
shares
|
(32.5)
|
|
(13.4)
|
|
(56.1)
|
|
(63.0)
|
|
Proceeds from
exercise of stock options
|
1.0
|
|
2.1
|
|
9.9
|
|
12.7
|
|
Payments related to
tax withholding for stock-based compensation
|
(1.2)
|
|
(0.4)
|
|
(9.3)
|
|
(5.4)
|
|
Net proceeds from
(payments on) credit facilities
|
2.0
|
|
(4.4)
|
|
41.8
|
|
41.4
|
|
Net (payments on)
proceeds from long-term debt
|
(28.3)
|
|
688.2
|
|
(57.7)
|
|
738.0
|
|
Other, net
|
(0.3)
|
|
(1.2)
|
|
(2.2)
|
|
(2.2)
|
|
Net Cash (Used in)
Provided by Financing Activities
|
$
|
(80.5)
|
|
$
|
649.4
|
|
$
|
(137.4)
|
|
$
|
657.3
|
|
Effect of exchange
rate changes on cash
|
(7.5)
|
|
(3.9)
|
|
(6.4)
|
|
(12.4)
|
|
Increase in Cash,
Cash Equivalents and Restricted Cash
|
$
|
14.5
|
|
$
|
8.4
|
|
$
|
48.8
|
|
$
|
29.6
|
|
Cash, Cash
Equivalents and Restricted Cash at Beginning of Period
|
167.4
|
|
146.6
|
|
133.1
|
|
125.4
|
|
Cash, Cash
Equivalents and Restricted Cash at End of Period
|
$
|
181.9
|
|
$
|
155.0
|
|
$
|
181.9
|
|
$
|
155.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliations of
Adjusted Net Income to GAAP Net Income and Adjusted Earnings Per
Share to GAAP Earnings Per Share:
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following
reconciliation is provided as additional relevant information about
the Company's performance deemed useful to investors.
Management believes that the non-GAAP measures of adjusted net
income and adjusted diluted earnings per share are important
financial measures used in the management of the business,
including decisions concerning the allocation of resources and
assessment of performance. Management believes that reporting
adjusted net income and adjusted diluted earnings per share is
useful to investors as these measures are representative of the
Company's core operations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
millions, except share data)
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2019
|
|
EPS
|
2018
|
|
EPS
|
|
2019
|
|
EPS
|
2018
|
|
EPS
|
Net Income
Attributable to The Timken Company
|
$
|
64.2
|
|
|
$
|
0.84
|
|
$
|
71.6
|
|
|
$
|
0.91
|
|
|
$
|
248.6
|
|
|
|
$
|
3.23
|
|
$
|
242.8
|
|
|
$
|
3.09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments:
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment,
restructuring and reorganization charges (2)
|
$
|
2.3
|
|
|
|
$
|
3.1
|
|
|
|
|
$
|
4.5
|
|
|
|
$
|
4.5
|
|
|
|
Property loss
and related expenses (3)
|
0.7
|
|
|
|
—
|
|
|
|
|
6.5
|
|
|
|
—
|
|
|
|
Acquisition-related charges
(4)
|
2.9
|
|
|
|
8.8
|
|
|
|
|
10.8
|
|
|
|
9.0
|
|
|
|
Brazil legal
matter (5)
|
—
|
|
|
|
—
|
|
|
|
|
3.3
|
|
|
|
—
|
|
|
|
Gain on sale of
real estate (6)
|
—
|
|
|
|
—
|
|
|
|
|
(1.7)
|
|
|
|
—
|
|
|
|
Corporate
pension and other postretirement benefit related charges
(7)
|
16.9
|
|
|
|
5.3
|
|
|
|
|
16.9
|
|
|
|
3.1
|
|
|
|
Loss on
divestiture (8)
|
—
|
|
|
|
0.6
|
|
|
|
|
—
|
|
|
|
0.6
|
|
|
|
Tax
indemnification and related items
|
—
|
|
|
|
0.3
|
|
|
|
|
0.5
|
|
|
|
0.6
|
|
|
|
Noncontrolling
interest of above adjustments
|
0.1
|
|
|
|
(0.6)
|
|
|
|
|
(0.1)
|
|
|
|
(0.6)
|
|
|
|
Provision for
income taxes (9)
|
0.3
|
|
|
|
(6.2)
|
|
|
|
|
0.2
|
|
|
|
(9.9)
|
|
|
|
Total Adjustments:
|
23.2
|
|
|
0.30
|
|
11.3
|
|
|
0.15
|
|
|
40.9
|
|
|
0.52
|
|
7.3
|
|
|
0.09
|
|
Adjusted Net Income
Attributable to The Timken Company
|
$
|
87.4
|
|
|
$
|
1.14
|
|
$
|
82.9
|
|
|
$
|
1.06
|
|
|
$
|
289.5
|
|
|
$
|
3.75
|
|
$
|
250.1
|
|
|
$
|
3.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Adjustments are pre-tax, with the
net tax provision listed separately.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
Impairment, restructuring and reorganization charges (including
items recorded in cost of products sold) relate to: (i) plant
closures; (ii) the rationalization of certain plants and (iii)
severance related to cost reduction initiatives. The Company
re-assesses its operating footprint and cost structure
periodically, and makes adjustments as needed that result in
restructuring charges. However, management believes these
actions are not representative of the Company's core
operations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
Represents property loss and related expenses during the year (net
of insurance proceeds) resulting from property loss that occurred
during the first quarter of 2019 at one of the Company's warehouses
in Knoxville, Tennessee and during the third quarter of 2019 at one
of the Company's warehouses in Yantai, China.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4)
Acquisition-related charges in 2019 primarily related to the Rollon
S.p.A. ("Rollon"), The Diamond Chain Company ("Diamond Chain"), and
BEKA Lubrication ("BEKA") acquisitions, including transaction costs
and inventory step-up impact.
|
|
|
|
|
|
|
|
|
(5) The Brazil legal matter
represents expense recorded to establish a liability associated
with an investigation into alleged antitrust violations in the
bearing industry that was initiated in October 2014. Refer to the
Contingencies footnote within the third quarter 2019 Form 10-Q for
additional discussion.
|
|
|
|
|
|
|
|
|
(6) The gain on sale of real estate
related to the sale of a manufacturing facility in Pulaski,
Tennessee during the first quarter of 2019. This amount was
recorded in other income.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(7)
Corporate pension and other postretirement benefit related charges
represent actuarial (gains) and losses that resulted from the
remeasurement of plan assets and obligations as a result of changes
in assumptions. The Company recognizes actuarial (gains) and losses
in connection with the annual remeasurement in the fourth quarter,
or if specific events trigger a remeasurement. Refer to the
Retirement Benefit Plans and Other Postretirement Benefit Plans
footnotes within the third quarter 2019 Form 10-Q for additional
discussion.
|
|
|
|
|
|
|
|
|
(8) Loss
on divestiture relates to the sale of the Groeneveld Information
Technology Holding B.V. (the "ICT Business"), located in Gorinchem,
Netherlands.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(9)
Provision for income taxes includes the net tax
impact on pre-tax adjustments (listed above), the impact of
discrete tax items recorded during the respective periods, as well
as other adjustments to reflect the use of one overall effective
tax rate on adjusted pre-tax income in interim periods.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
EBIT to GAAP Net Income, and EBIT and EBITDA Margin, After
Adjustments, to Net Income as a Percentage of Sales, and EBIT and
EBITDA, After Adjustments, to Net Income:
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
The following
reconciliation is provided as additional relevant information about
the Company's performance deemed useful to investors.
Management believes consolidated earnings before interest and
taxes (EBIT) is a non-GAAP measure that is useful to investors as
it is representative of the Company's performance and that it is
appropriate to compare GAAP net income to consolidated EBIT.
Management also believes that non-GAAP measures of adjusted EBIT,
adjusted earnings before interest, taxes, depreciation and
amortization (EBITDA), adjusted EBIT margin and adjusted EBITDA
margin are useful to investors as they are representative of the
Company's core operations and are used in the management of the
business, including decisions concerning the allocation of
resources and assessment of performance.
|
|
|
|
|
|
|
|
|
|
|
(Dollars in
millions)
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2019
|
Percentage
to
Net Sales
|
2018
|
Percentage
to Net Sales
|
|
2019
|
Percentage
to
Net Sales
|
2018
|
Percentage
to
Net Sales
|
Net Income
|
$
|
66.7
|
|
7.3
|
%
|
$
|
72.3
|
|
8.2
|
%
|
|
$
|
256.9
|
|
8.9
|
%
|
$
|
244.7
|
|
9.2
|
%
|
|
|
|
|
|
|
|
|
|
|
Provision for income
taxes
|
35.5
|
|
3.9
|
%
|
25.0
|
|
2.8
|
%
|
|
110.4
|
|
3.8
|
%
|
83.5
|
|
3.1
|
%
|
Interest
expense
|
18.2
|
|
2.0
|
%
|
12.5
|
|
1.4
|
%
|
|
55.5
|
|
1.9
|
%
|
33.2
|
|
1.3
|
%
|
Interest
income
|
(1.1)
|
|
(0.1)
|
%
|
(0.6)
|
|
—
|
%
|
|
(3.5)
|
|
(0.1)
|
%
|
(1.5)
|
|
(0.1)
|
%
|
Consolidated
EBIT
|
$
|
119.3
|
|
13.1
|
%
|
$
|
109.2
|
|
12.4
|
%
|
|
$
|
419.3
|
|
14.5
|
%
|
$
|
359.9
|
|
13.5
|
%
|
|
|
|
|
|
|
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
Impairment,
restructuring and reorganization charges (1)
|
$
|
2.3
|
|
0.3
|
%
|
$
|
3.1
|
|
0.3
|
%
|
|
$
|
4.5
|
|
0.2
|
%
|
$
|
4.5
|
|
0.2
|
%
|
Property loss
and related expenses (2)
|
0.7
|
|
—
|
%
|
—
|
|
—
|
%
|
|
6.5
|
|
0.2
|
%
|
—
|
|
—
|
%
|
Acquisition-related charges
(3)
|
2.9
|
|
0.3
|
%
|
8.8
|
|
1.0
|
%
|
|
10.8
|
|
0.4
|
%
|
9.0
|
|
0.3
|
%
|
Brazil legal
matter (4)
|
—
|
|
—
|
%
|
—
|
|
—
|
%
|
|
3.3
|
|
0.1
|
%
|
—
|
|
—
|
%
|
Gain on sale of
real estate (5)
|
—
|
|
—
|
%
|
—
|
|
—
|
%
|
|
(1.7)
|
|
(0.1)
|
%
|
—
|
|
—
|
%
|
Corporate
pension and other postretirement benefit related charges
(6)
|
16.9
|
|
1.8
|
%
|
5.3
|
|
0.6
|
%
|
|
16.9
|
|
0.6
|
%
|
3.1
|
|
0.1
|
%
|
Tax
indemnification and related items
|
—
|
|
—
|
%
|
0.3
|
|
—
|
%
|
|
0.5
|
|
—
|
%
|
0.6
|
|
—
|
%
|
Loss on
divestiture (7)
|
—
|
|
—
|
%
|
0.6
|
|
0.1
|
%
|
|
—
|
|
—
|
%
|
0.6
|
|
—
|
%
|
Total
Adjustments
|
22.8
|
|
2.4
|
%
|
18.1
|
|
2.0
|
%
|
|
40.8
|
|
1.4
|
%
|
17.8
|
|
0.6
|
%
|
Adjusted
EBIT
|
$
|
142.1
|
|
15.5
|
%
|
$
|
127.3
|
|
14.4
|
%
|
|
$
|
460.1
|
|
15.9
|
%
|
$
|
377.7
|
|
14.1
|
%
|
Depreciation and
amortization
|
39.2
|
|
4.3
|
%
|
35.1
|
|
4.0
|
%
|
|
120.4
|
|
4.2
|
%
|
105.9
|
|
4.0
|
%
|
Adjusted
EBITDA
|
$
|
181.3
|
|
19.8
|
%
|
$
|
162.4
|
|
18.4
|
%
|
|
$
|
580.5
|
|
20.1
|
%
|
$
|
483.6
|
|
18.1
|
%
|
|
|
|
|
|
|
|
|
|
|
(1)
Impairment, restructuring and reorganization charges (including
items recorded in cost of products sold) relate to: (i) plant
closures; (ii) the rationalization of certain plants and (iii)
severance related to cost reduction initiatives. The Company
re-assesses its operating footprint and cost structure
periodically, and makes adjustments as needed that result in
restructuring charges. However, management believes these
actions are not representative of the Company's core
operations.
|
|
|
|
|
|
|
|
|
|
|
(2) Represents
property loss and related expenses during the year (net of
insurance proceeds) resulting from property loss that occurred
during the first quarter of 2019 at one of the Company's warehouses
in Knoxville, Tennessee and during the third quarter of 2019 at one
of the Company's warehouses in Yantai, China.
|
|
|
|
|
|
|
|
|
|
|
(3)
Acquisition-related charges in 2019 primarily related to the
Rollon, Diamond Chain, and BEKA acquisitions, including transaction
costs and inventory step-up impact.
|
|
|
|
|
|
|
|
|
|
|
(4) The
Brazil legal matter represents expense recorded to establish a
liability associated with an investigation into alleged antitrust
violations in the bearing industry that was initiated in October
2014. Refer to the Contingencies footnote within the third quarter
2019 Form 10-Q for additional discussion.
|
|
|
|
|
|
|
|
|
|
|
(5) The gain on sale of real estate
related to the sale of a manufacturing facility in Pulaski,
Tennessee during the first quarter of 2019. This amount was
recorded in other income.
|
|
|
|
|
|
|
|
|
|
|
(6) Corporate pension and other
postretirement benefit related charges represent actuarial (gains)
and losses that resulted from the remeasurement of plan assets and
obligations as a result of changes in assumptions. The Company
recognizes actuarial (gains) and losses in connection with the
annual remeasurement in the fourth quarter, or if specific events
trigger a remeasurement.
|
|
|
|
|
|
|
|
|
|
|
(7) Loss
on divestiture relates to the sale of the ICT Business, located in
Gorinchem, Netherlands.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
segment EBIT Margin, After Adjustments, to segment EBIT as a
Percentage of Sales and segment EBIT, After Adjustments, to segment
EBIT:
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
The following
reconciliation is provided as additional relevant information about
the Company's Mobile Industries and Process Industries segment
performance deemed useful to investors. Management believes that
non-GAAP measures of adjusted EBIT and adjusted EBIT margin for the
segments are useful to investors as they are representative of each
segment's core operations and are used in the management of the
business, including decisions concerning the allocation of
resources and assessment of performance.
|
|
|
|
|
|
|
|
|
|
|
Mobile
Industries
|
|
|
|
|
|
|
|
|
|
(Dollars in
millions)
|
Three Months
Ended
September 30,
2019
|
Percentage to Net
Sales
|
Three Months
Ended
September 30, 2018
|
Percentage to Net
Sales
|
|
Nine Months
Ended
September 30,
2019
|
Percentage to Net
Sales
|
Nine Months
Ended
September 30,
2018
|
Percentage to Net
Sales
|
Earnings before
interest and taxes (EBIT)
|
$
|
52.0
|
|
11.4
|
%
|
$
|
50.6
|
|
10.9
|
%
|
|
$
|
172.5
|
|
11.9
|
%
|
$
|
156.2
|
|
10.8
|
%
|
Impairment,
restructuring and
reorganization charges (1)
|
1.0
|
|
0.2
|
%
|
0.9
|
|
0.2
|
%
|
|
2.1
|
|
0.1
|
%
|
2.0
|
|
0.1
|
%
|
Loss on
divestiture (2)
|
—
|
|
—
|
%
|
0.6
|
|
0.1
|
%
|
|
—
|
|
—
|
%
|
0.6
|
|
0.1
|
%
|
Gain on sale of
real estate (3)
|
—
|
|
—
|
%
|
—
|
|
—
|
%
|
|
(1.7)
|
|
(0.1)
|
%
|
—
|
|
—
|
%
|
Property loss
and related expenses (4)
|
0.8
|
|
0.2
|
%
|
—
|
|
—
|
%
|
|
6.5
|
|
0.5
|
%
|
—
|
|
—
|
%
|
Acquisition-related charges
(5)
|
—
|
|
—
|
%
|
0.4
|
|
0.1
|
%
|
|
0.1
|
|
—
|
%
|
0.4
|
|
—
|
%
|
Adjusted
EBIT
|
$
|
53.8
|
|
11.8
|
%
|
$
|
52.5
|
|
11.3
|
%
|
|
$
|
179.5
|
|
12.4
|
%
|
$
|
159.2
|
|
11.0
|
%
|
|
|
|
|
|
|
|
|
|
|
Process
Industries
|
|
|
|
|
|
|
|
|
|
(Dollars in
millions)
|
Three Months
Ended
September 30,
2019
|
Percentage to Net
Sales
|
Three Months
Ended
September 30,
2018
|
Percentage to Net
Sales
|
|
Nine Months
Ended
September 30,
2019
|
Percentage to Net
Sales
|
Nine Months
Ended
September 30,
2018
|
Percentage to Net
Sales
|
Earnings before
interest and taxes (EBIT)
|
$
|
95.6
|
|
20.8
|
%
|
$
|
81.8
|
|
19.6
|
%
|
|
$
|
304.8
|
|
21.1
|
%
|
$
|
254.0
|
|
20.7
|
%
|
Impairment,
restructuring and
reorganization charges (1)
|
1.2
|
|
0.3
|
%
|
0.8
|
|
0.2
|
%
|
|
2.4
|
|
0.1
|
%
|
1.0
|
|
0.1
|
%
|
Acquisition-related charges
(5)
|
1.5
|
|
0.3
|
%
|
1.4
|
|
0.3
|
%
|
|
7.9
|
|
0.6
|
%
|
1.4
|
|
0.1
|
%
|
Adjusted
EBIT
|
$
|
98.3
|
|
21.4
|
%
|
$
|
84.0
|
|
20.1
|
%
|
|
$
|
315.1
|
|
21.8
|
%
|
$
|
256.4
|
|
20.9
|
%
|
|
|
|
|
|
|
|
|
|
|
(1)
Impairment, restructuring and reorganization charges (including
items recorded in cost of products sold) relate to: (i) plant
closures; (ii) the rationalization of certain plants and (iii)
severance related to cost reduction initiatives. The Company
re-assesses its operating footprint and cost structure
periodically, and makes adjustments as needed that result in
restructuring charges. However, management believes these
actions are not representative of the Company's core
operations.
|
|
|
|
|
|
|
|
|
|
|
(2) Loss
on divestiture relates to the sale of the ICT Business, located in
Gorinchem, Netherlands.
|
|
|
|
|
|
|
|
|
|
|
(3) The gain on sale of real estate
related to the sale of a manufacturing facility in Pulaski,
Tennessee during the first quarter of 2019. This amount was
recorded in other income.
|
|
|
|
|
|
|
|
|
|
|
(4) Represents
property loss and related expenses during the year (net of
insurance proceeds) resulting from property loss that occurred
during the first quarter of 2019 at one of the Company's warehouses
in Knoxville, Tennessee and during the third quarter of 2019 at one
of the Company's warehouses in Yantai, China.
|
|
|
|
|
|
|
|
|
|
|
(5) Acquisition-related charges in
2019 primarily related to the inventory step-up impact for the
Rollon and Diamond Chain acquisitions.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Total Debt to Net Debt, the Ratio of Net Debt to Capital, and the
Ratio of Net Debt to Adjusted EBITDA:
|
(Unaudited)
|
|
|
|
|
These reconciliations
are provided as additional relevant information about the Company's
financial position deemed useful to investors. Capital, used for
the ratio of net debt to capital, is a non-GAAP measure defined as
total debt less cash, cash equivalents and restricted cash plus
total shareholders' equity. Management believes Net Debt, the
Ratio of Net Debt to Capital, Adjusted EBITDA (see below), and the
Ratio of Net Debt to Adjusted EBITDA are important measures of the
Company's financial position, due to the amount of cash and cash
equivalents on hand.
|
|
|
|
|
|
(Dollars in
millions)
|
|
|
|
|
|
|
|
September 30,
2019
|
December 31,
2018
|
Short-term debt,
including current portion of long-term debt
|
|
|
$
|
96.6
|
|
$
|
43.0
|
|
Long-term
debt
|
|
|
1,553.5
|
|
1,638.6
|
|
Total
Debt
|
|
|
$
|
1,650.1
|
|
$
|
1,681.6
|
|
Less: Cash, cash
equivalents and restricted cash
|
|
|
(181.9)
|
|
(133.1)
|
|
Net Debt
|
|
|
$
|
1,468.2
|
|
$
|
1,548.5
|
|
|
|
|
|
|
Total
Equity
|
|
|
$
|
1,817.5
|
|
$
|
1,642.7
|
|
|
|
|
|
|
Ratio of Net Debt to
Capital
|
|
|
44.7
|
%
|
48.5
|
%
|
|
|
|
|
|
Adjusted EBITDA for
the Twelve Months Ended
|
|
|
$
|
743.4
|
|
$
|
646.5
|
|
|
|
|
|
|
Ratio of Net Debt to
Adjusted EBITDA
|
|
|
2.0
|
|
2.4
|
|
|
|
|
|
|
Reconciliation of
Free Cash Flow to GAAP Net Cash Provided by Operating
Activities:
|
(Unaudited)
|
|
|
|
|
Management believes
that free cash flow is a non-GAAP measure that is useful to
investors because it is a meaningful indicator of cash generated
from operating activities available for the execution of its
business strategy.
|
|
|
|
|
|
(Dollars in
millions)
|
|
|
|
|
|
Three Months
Ended
September 30,
|
Nine Months
Ended
September 30,
|
|
2019
|
2018
|
2019
|
2018
|
Net cash provided by
operating activities
|
$
|
144.9
|
|
$
|
137.2
|
|
$
|
354.8
|
|
$
|
195.0
|
|
Less: capital
expenditures
|
(43.7)
|
|
(23.2)
|
|
(82.9)
|
|
(62.8)
|
|
Free cash
flow
|
$
|
101.2
|
|
$
|
114.0
|
|
$
|
271.9
|
|
$
|
132.2
|
|
|
|
|
|
|
|
|
|
Reconciliation of
EBIT, EBIT, After Adjustments, and EBITDA, After Adjustments, to
GAAP Net Income:
|
(Unaudited)
|
|
|
The following
reconciliation is provided as additional relevant information about
the Company's performance deemed useful to investors. Management
believes consolidated earnings before interest and taxes (EBIT) is
a non-GAAP measure that is useful to investors as it is
representative of the Company's performance and that it is
appropriate to compare GAAP net income to consolidated EBIT.
Management also believes that non-GAAP measures of adjusted EBIT
and adjusted EBITDA are useful to investors as they are
representative of the Company's core operations and are used in the
management of the business, including decisions concerning the
allocation of resources and assessment of performance.
|
|
|
|
(Dollars in
millions)
|
Twelve Months
Ended
September 30, 2019
|
Twelve Months
Ended
December 31, 2018
|
Net Income
|
$
|
317.7
|
|
$
|
305.5
|
|
Provision for income
taxes
|
129.5
|
|
102.6
|
|
Interest
expense
|
74.0
|
|
51.7
|
|
Interest
income
|
(4.1)
|
|
(2.1)
|
|
Consolidated
EBIT
|
$
|
517.1
|
|
$
|
457.7
|
|
Adjustments:
|
|
|
Impairment,
restructuring and reorganization charges (1)
|
$
|
7.1
|
|
$
|
7.1
|
|
Acquisition-related charges
(2)
|
22.4
|
|
20.6
|
|
Brazil legal
matter (3)
|
3.3
|
|
—
|
|
Gain on sale of
real estate (4)
|
(1.7)
|
|
—
|
|
Loss on
divestiture (5)
|
0.2
|
|
0.8
|
|
Corporate
pension and other postretirement benefit related charges
(6)
|
26.6
|
|
12.8
|
|
Property loss
and related expenses (7)
|
6.5
|
|
—
|
|
Tax
indemnification and related items
|
1.4
|
|
1.5
|
|
Total
Adjustments
|
65.8
|
|
42.8
|
|
Adjusted
EBIT
|
$
|
582.9
|
|
$
|
500.5
|
|
Depreciation and
amortization
|
160.5
|
|
146.0
|
|
Adjusted EBITDA
(8)
|
$
|
743.4
|
|
$
|
646.5
|
|
|
|
|
(1)
Impairment, restructuring and reorganization charges (including
items recorded in cost of products sold) relate to: (i) plant
closures; (ii) the rationalization of certain plants and (iii)
severance related to cost reduction initiatives. The Company
re-assesses its operating footprint and cost structure
periodically, and makes adjustments as needed that result in
restructuring charges. However, management believes these
actions are not representative of the Company's core
operations.
|
|
|
|
(2)
Acquisition-related charges in 2019 related to the ABC Bearings,
Apiary Investment Holdings Limited ("Cone Drive"), Rollon, Diamond
Chain, and BEKA acquisitions, including transaction costs and
inventory step-up impact. In 2018, acquisition charges related to
ABC Bearings, Cone Drive and Rollon acquisitions.
|
|
|
|
(3) The
Brazil legal matter represents expense recorded to establish a
liability associated with an investigation into alleged antitrust
violations in the bearing industry that was initiated in October
2014. Refer to the Contingencies footnote within the third quarter
2019 Form 10-Q for additional discussion.
|
|
|
|
(4) The gain on sale of real estate
related to the sale of a manufacturing facility in Pulaski,
Tennessee during the first quarter of 2019. This amount was
recorded in other income.
|
|
|
|
(5) Loss
on divestiture relates to the sale of Groeneveld Information
Technology Holding B.V. located in Gorinchem,
Netherlands.
|
|
|
|
(6) Corporate pension and other
postretirement benefit related charges represent actuarial (gains)
and losses that resulted from the remeasurement of plan assets and
obligations as a result of changes in assumptions. The Company
recognizes actuarial (gains) and losses in connection with the
annual remeasurement in the fourth quarter, or if specific events
trigger a remeasurement.
|
|
|
|
(7) Represents property loss and
related expenses during the year (net of insurance proceeds)
resulting from property loss that occurred during the first quarter
of 2019 at one of the Company's warehouses in Knoxville, Tennessee
and during the third quarter of 2019 at one of the Company's
warehouse in Yantai, China.
|
|
|
|
(8) Twelve
months trailing adjusted EBITDA reflects results from acquired
companies from the acquisition date through September 30, 2019 and
December 31, 2018, respectively.
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Adjusted Earnings per Share to GAAP Earnings per Share for Full
Year 2019 Outlook:
|
(Unaudited)
|
The following
reconciliation is provided as additional relevant information about
the Company's outlook deemed useful to investors. Forecasted
full year adjusted diluted earnings per share is an important
financial measure that management believes is useful to investors
as it is representative of the Company's expectation for the
performance of its core business operations.
|
|
|
|
|
|
Low End
Earnings
Per Share
|
|
High End
Earnings
Per Share
|
Forecasted full year
GAAP diluted earnings per share
|
$
|
4.15
|
|
|
$
|
4.20
|
|
|
|
|
|
Forecasted
Adjustments:
|
|
|
|
Restructuring
and other special items, net (1)
|
0.55
|
|
|
0.55
|
|
Total
Adjustments:
|
$
|
0.55
|
|
|
$
|
0.55
|
|
Forecasted full year
adjusted diluted earnings per share
|
$
|
4.70
|
|
|
$
|
4.75
|
|
|
|
|
|
(1) Restructuring and other special
items, net do not include the impact of any potential
mark-to-market pension and other postretirement remeasurement
adjustment, because the amounts will not be known until
incurred.
|
|
|
|
|
|
|
|
|
Reconciliation of
Free Cash Flow to GAAP Net Cash Provided by Operating Activities
for Full Year 2019 Outlook:
|
(Unaudited)
|
|
|
|
Forecasted full year
free cash flow is a non-GAAP measure that is useful to investors
because it is representative of the Company's expectation of cash
that will be generated from operating activities and available for
the execution of its business strategy.
|
(Dollars in
Millions)
|
|
|
Free Cash
Flow Outlook
|
Net cash provided by
operating activities
|
|
|
$
|
525.0
|
|
Less: capital
expenditures
|
|
|
(150.0)
|
|
Free cash
flow
|
|
|
$
|
375.0
|
|
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SOURCE The Timken Company