Xerium Technologies, Inc. (NYSE:XRM), a leading global provider of
industrial consumable products and services, today issued an
investor update.
Q2 2014 Financial Results
The company plans to file its results for Q2 2014 after the
close of trading on Tuesday, August 5, 2014.
Q2 2014 Presentation and Conference Call
The company plans to make a public presentation and conduct a
public conference call regarding its results on August 6, 2014 at
9:00 am ET.
Conference call details: |
|
Domestic Dial-In: |
+1-866-270-6057 |
International Dial-In: |
+1-617-213-8891 |
Passcode: |
41877256 |
Webcast & Slide Presentation: |
www.xerium.com/investorrelations |
To participate on the call, please dial in at least 10 minutes
prior to the scheduled start.
Presentation viewing details:
A live audio webcast and replay of the call, in addition to the
materials used in the presentation, will be available in the
investor relations section of the company's website at
www.xerium.com/investorrelations. Please click on the earnings
call event link that will appear on the IR homepage.
Jefferies 2014 Global Industrials
Conference
Xerium will be presenting at the Jefferies 2014 Global
Industrials Conference in New York and conducting one-on-one
meetings with interested investors. Harold Bevis, President and
CEO, Cliff Pietrafitta, Executive Vice President and CFO, and Dave
Pretty, President of North America and Europe, will be the
company's attendees and will be presenting at the conference at
9:00 am ET on Thursday, August 14, 2014.
This presentation will also be webcast live at
www.xerium.com/investorrelations. Please click on the event
link that will appear on the IR homepage. A replay of the
presentation and a copy of the materials used in the presentation
will also be available on Xerium's investor relations
website.
The company will also be available to meet one-on-one with
investors the day before and the day of the presentation. If you
have interest in one of these sessions please contact Isabel
Zakoscielny at izakoscielny@jefferies.com.
Q2 2014 Preliminary Results and Full Year 2014 Remain on
Forecast
Q2 2014 preliminary results indicate the company's performance
was in-line with previous guidance. Sales for Q2 2014 were
approximately $139.7 million, which was an increase of 1.0% over Q2
2013 and an increase of 4.7% over Q1 2014. Adjusted EBITDA for
Q2 2014 was approximately $29.4 million and net income for the
quarter was approximately $0.8 million. See "Non-GAAP
Financial Measures" below.
These results are preliminary and subject to change upon
completion and review of Xerium's 2014 second quarter financial
statements in conjunction with the company's 2014 second quarter
Form 10-Q filing.
Non-GAAP Financial Measures
This press release includes measures of performance that differ
from the company's financial results as reported under generally
accepted accounting principles ("GAAP"). The company uses
supplementary non-GAAP measures, including EBITDA, Adjusted EBITDA,
currency effects on Net Sales and Trade Working Capital to assist
in evaluating its liquidity and financial performance. EBITDA and
Adjusted EBITDA are specifically used in evaluating the ability to
service indebtedness and to fund ongoing capital expenditures.
Neither Adjusted EBITDA nor EBITDA should be considered in
isolation or as a substitute for income (loss) or cash flows from
operations (as determined in accordance with GAAP).
For additional information regarding non-GAAP financial measures
and a reconciliation of such measures to the most comparable
financial measures under GAAP, please see our Selected Financial
Data below.
ABOUT XERIUM TECHNOLOGIES
Xerium Technologies, Inc. (NYSE:XRM) is a leading global
provider of industrial consumable products and services. Xerium,
which operates around the world under a variety of brand names,
utilizes a broad portfolio of patented and proprietary technologies
to provide customers with tailored solutions and products integral
to production, all designed to optimize performance and reduce
operational costs. With 27 manufacturing facilities in 12 countries
around the world, Xerium has approximately 3,200 employees.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements. The
words "believe," "estimate," "expect," "intend," "anticipate,"
"goals," variations of such words, and similar expressions identify
forward-looking statements, but their absence does not mean that
the statement is not forward-looking. Forward-looking
statements are not guarantees of future performance, and actual
results may vary materially from the results expressed or implied
in such statements. Differences may result from actions taken by
us, as well as from risks and uncertainties beyond our
control.These risks and uncertainties include the following items:
(1) our final sales, net income and Adjusted EBITDA results for the
second quarter of 2014 may be different than the preliminary
results we announced today; (2) we may not realize the full year
Adjusted EBITDA performance we have forecast; (3) our expected
sales performance and our backlog of sales may not be fully
realized; (4) our cost reduction efforts, including our
restructuring activities, may not have the positive impacts we
anticipate; (5) we are subject to execution risk related to the
startup of our proposed new facility in China; (6) our plans to
develop and market new products, enhance operational efficiencies
and reduce costs may not be successful; (7) market improvement in
our industry may occur more slowly than we anticipate, may stall or
may not occur at all; (8) variations in demand for our products,
including our new products, could negatively affect our revenues
and profitability; (9) our manufacturing facilities may be required
to quickly increase or decrease production, which could negatively
affect our production facilities, customer order lead time, product
quality, labor relations or gross margin; and (10) the other risks
and uncertainties discussed elsewhere in this press release, our
Form 10-K for the year ended December 31, 2013 filed on March 4,
2014 and our other SEC filings. If any of these risks or
uncertainties materialize, or if our underlying assumptions prove
to be incorrect, actual results may vary significantly from what we
projected. Any forward-looking statement in this press release
reflects our current views with respect to future events. Except as
required by law, we assume no obligation to publicly update or
revise these forward-looking statements for any reason, whether as
a result of new information, future events, or otherwise. As
discussed above, we are subject to substantial risks and
uncertainties related to current economic conditions, and we
encourage investors to refer to our SEC filings for additional
information. Copies of these filings are available from the
SEC and in the investor relations section of our website at
www.xerium.com.
Selected Financial Data
EBITDA and Adjusted EBITDA Non-GAAP
Measures
Non-GAAP Financial Measures
We use EBITDA and Adjusted EBITDA (as defined in our credit
facility) as supplementary non-GAAP liquidity measures to assist us
in evaluating our liquidity and financial performance, specifically
our ability to service indebtedness and to fund ongoing capital
expenditures. Neither EBITDA nor Adjusted EBITDA should be
considered in isolation or as a substitute for income (loss) or
cash flows from operations (as determined in accordance with
GAAP).
EBITDA is defined as net income (loss) before interest expense,
income tax provision (benefit) and depreciation (including non-cash
impairment charges) and amortization.
"Adjusted EBITDA" means, with respect to any period, the total
of (A) the consolidated net income for such period, plus
(B) without duplication, to the extent that any of the
following were deducted in computing such consolidated net income
for such period: (i) provision for taxes based on income or
profits, including, without limitation, federal, state, provincial,
franchise and similar taxes, including any penalties and interest
relating to any tax examinations, (ii) consolidated interest
expense, (iii) consolidated depreciation and amortization
expense, (iv) reserves for inventory in connection with plant
closures, (v) consolidated operational restructuring costs,
subject to annual limitations provided for in our credit facility,
(vi) noncash charges resulting from the application of
purchase accounting, including push-down accounting,
(vii) non-cash expenses resulting from the granting of common
stock, stock options, restricted stock or restricted stock unit
awards under equity compensation programs solely with respect to
common stock, and cash expenses for compensation mandatorily
applied to purchase common stock, (viii) non-cash items
relating to a change in or adoption of accounting policies,
(ix) non-cash expenses relating to pension or benefit
arrangements, (x) expenses incurred as a result of the
repurchase, redemption or retention of common stock earned under
equity compensation programs solely in order to make withholding
tax payments, (xi) amortization or write-offs of deferred
financing costs, (xii) any non-cash losses resulting from mark
to market hedging obligations (to the extent the cash impact
resulting from such loss has not been realized in such period) and
(xiii) other non-cash losses or charges (excluding, however,
any non-cash loss or charge which represents an accrual of, or a
reserve for, a cash disbursement in a future period), minus
(C) without duplication, to the extent any of the following
were included in computing consolidated net income for such period,
(i) non-cash gains with respect to the items described in
clauses (vi), (vii), (ix), (xi), (xii) and (xiii) (other
than, in the case of clause (xiii), any such gain to the extent
that it represents a reversal of an accrual of, or reserve for, a
cash disbursement in a future period) of clause (B) above and
(ii) provisions for tax benefits based on income or profits.
Notwithstanding the foregoing, Adjusted EBITDA, as defined in the
credit facility and calculated below, may not be comparable to
similarly titled measurements used by other companies.
Consolidated net income is defined as net income
(loss) determined on a consolidated basis in accordance with
GAAP; provided, however, that the following, without duplication,
shall be excluded in determining consolidated net income:
(i) any net after-tax extraordinary or non-recurring gains,
losses or expenses (less all fees and expenses relating thereto),
(ii) the cumulative effect of changes in accounting
principles, (iii) any fees and expenses incurred during such
period in connection with the issuance or repayment of
indebtedness, any refinancing transaction or amendment or
modification of any debt instrument, in each case, as permitted
under the credit facility and (iv) any cancellation of
indebtedness income.
The following table provides reconciliation from net income and
operating cash flows, which are the most directly comparable GAAP
financial measures, to EBITDA and Adjusted EBITDA (dollars in
thousands).
|
Three Months Ended June 30,
2014 |
Net income (loss) |
$ 764 |
Stock-based compensation |
640 |
Depreciation |
8,534 |
Amortization of intangibles |
583 |
Deferred financing cost amortization |
751 |
Unrealized foreign exchange loss (gain) on
revaluation of debt |
366 |
Deferred taxes |
(143) |
Asset impairment |
-- |
Loss (gain) on disposition of property and
equipment |
1 |
Loss on extinguishment of debt |
-- |
Net change in operating assets and
liabilities |
(5,343) |
|
|
Net cash provided by operating
activities |
6,153 |
Interest expense, excluding amortization |
7,985 |
Net change in operating assets and
liabilities |
5,343 |
Current portion of income tax expense |
2,472 |
Stock-based compensation |
(640) |
Unrealized foreign exchange (loss) gain on
revaluation of debt |
(366) |
Asset impairment |
-- |
(Loss) gain on disposition of property and
equipment |
(1) |
Loss on extinguishment of debt |
-- |
|
|
EBITDA |
20,946 |
Loss on extinguishment of debt |
-- |
Stock-based compensation |
640 |
Operational restructuring expenses |
7,595 |
Inventory writeoff |
-- |
Non-cash impairment charges |
-- |
Plant startup costs |
240 |
Adjusted EBITDA |
$ 29,421 |
CONTACT: Phillip B. Kennedy
Investor Relations
919-526-1444
IR@xerium.com
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