HZN Horizon Global Corporation

Business Update

• Delivered progress against previously announced Action Plan, with Americas’ workforce reductions and facility consolidation complete
• Kansas City distribution center improved shipping volumes, resulting in a $9 million reduction of past due orders from peak levels of approximately $26 million
• Net sales of $233.3 million, down 8.0 percent
  • Net sales declined 10.5 percent in constant currency(3)
• Non-cash goodwill impairment of $55.7 million in Europe-Africa segment
• Operating loss of $64.1 million, operating profit margin of (27.5) percent
  • Adjusted operating profit(1) of $13.8 million, adjusted operating profit(1) margin of 5.9 percent
• Second quarter diluted loss per share of $2.68
  • Second quarter adjusted diluted earnings per share(2) of $0.36

Horizon Global Corporation (NYSE: HZN), one of the world’s leading manufacturers of branded towing and trailering equipment, today reported second quarter results. The Company also provided an update on its Action Plan, including the completion of the restructuring of its Americas segment, operational improvements at its Kansas City Aftermarket and Retail distribution facility, and business improvement activities in its Europe-Africa segment.

“We remain encouraged that our global team continues to make solid progress on the Action Plan even though consolidated results for the second quarter are not in line with the prior year,” said Carl Bizon, Interim President and Chief Executive Officer of Horizon Global. “Of key importance is the ramp up of our Kansas City distribution center and, as of the end of last week, I am pleased to report that we are currently exceeding our average daily shipment goal, and this facility is now demonstrating its ability to meet the requirements of our business. We closed the quarter with past due orders of approximately $23 million, which significantly impacted our second quarter performance. As we continue to reduce past due orders, we are fortunate that our customers have largely remained resilient and stayed with us during the Kansas City ramp-up process.

“The second quarter and beginning of the current quarter have been marked by a number of key events -- we made key senior management changes, including the naming of new leadership for our Company and its two largest operating segments; we terminated the Brink acquisition; and, just last week, we announced a successful amendment of our term loan agreement, which included securing an incremental $50 million to address short-term liquidity needs. As a Company, we are clearly not standing still and are moving quickly to fix near-term operational issues. We believe we are nearing completion in the Americas, and new leadership in Europe-Africa will be building upon the foundation of that business, while closely assessing the organization and its business processes for operating and financial improvement.

“As we look across our global business, Asia-Pacific is performing well, the Americas is working through a transitional year and we are closely assessing and prioritizing business improvement initiatives in Europe-Africa. I remain confident that the underlying strengths of our Company - great brands, great products, excellent quality, strong customer relationships, experienced and committed team members and solid end markets - will lead us past these near-term challenges and position our Company for long-term success.”

2018 Second Quarter Segment Results

Horizon Americas. Net sales decreased 21.7 percent, primarily driven by capacity constraints during the ramp up of the Kansas City distribution center. The segment exited the quarter with past due orders of approximately $23 million. Operating profit decreased $20.2 million to a loss of $2.6 million, or 2.4 percent of net sales, due to lower sales volumes, unfavorable input costs and severance and restructuring costs associated with facility closures and delayering the organization. Adjusted operating profit(1) decreased $12.1 million to $10.6 million, or 9.8 percent of net sales.

Horizon Europe-Africa. Net sales increased 4.9 percent, but declined 2.2 percent in constant currency(3), as revenue growth in the OE channel was more than offset by a decline in the aftermarket channel due to limited product availability resulting from the production shift to Braşov. Operating profit decreased $59.3 million to a loss of $55.7 million, or 61.3 percent of net sales, attributable to the impairment of goodwill. Adjusted operating profit(1) decreased $2.1 million to $2.6 million, or 2.9 percent of net sales, due primarily to the margin mix impact from the lower-margin OE business and material cost increases in excess of realized price increases.

Horizon Asia-Pacific. Net sales increased 19.1 percent, or 17.5 percent, in constant currency(3), primarily attributable to the Best Bars acquisition completed in the third quarter of 2017. Operating profit increased 8.9 percent to $4.7 million, or 13.6 percent of net sales, driven by higher sales volumes.

Action Plan

Horizon Global announced a business improvement plan on March 1, 2018, with targeted initiatives to drive operating results in its Americas and Europe-Africa segments. The Action Plan is expected to deliver $3.0 million to $5.0 million in consolidated cost savings in 2018, and once implemented, $10.0 million to $12.0 million in consolidated cost savings on a full-year run rate basis. Action Plan updates include:

• Reduced past due orders from a peak of approximately $26 million in mid-July to approximately $17 million as of August 5
• Completed closure of Mosinee, Wisconsin and Solon, Ohio facilities
• Completed 30 percent reduction in Americas’ U.S.-based salaried workforce
• Reynosa targeted production levels achieved
• Europe-Africa’s low-cost-country production increased to 28 percent year to date

Bizon concluded, “Our global team remains focused on achieving our Action Plan. We are pleased to have completed several initiatives specific to the Americas; however, we know there is a good deal of work yet to be done in Europe. The team remains committed to our success, and we are working hard to meet, and ultimately exceed, the expectations of our customers, the end users of our products and our shareholders.”

Conference Call Details

Horizon Global will host a conference call regarding second quarter 2018 earnings on Tuesday, August 7, 2018, at 8:30 a.m. Eastern Time. Participants in the call are asked to register five to ten minutes prior to the scheduled start time by dialing (844) 711-8052 and from outside the U.S. at (832) 900-4641. Please use the conference identification number 9559399.

The conference call will be webcast simultaneously and in its entirety through the Horizon Global website. An earnings presentation will also be available on the Horizon Global website at the time of the conference call. Shareholders, media representatives and others may participate in the webcast by registering through the investor relations section on the Company’s website.

A replay of the call will be available on Horizon Global’s website or by phone by dialing (800) 585-8367 and from outside the U.S. at (404) 537-3406. Please use the conference identification number 9559399. The telephone replay will be available approximately two hours after the end of the call and continue through August 21, 2018.

About Horizon Global

Horizon Global is the #1 designer, manufacturer and distributor of a wide variety of high-quality, custom-engineered towing, trailering, cargo management and other related accessory products in North America, Australia and Europe. The Company serves OEMs, retailers, dealer networks and the end consumer as the category leader in the automotive, leisure and agricultural market segments. Horizon provides its customers with outstanding products and services that reflect the Company’s commitment to market leadership, innovation and operational excellence. The Company’s mission is to utilize forward-thinking technology to develop and deliver best-in-class products for our customers, engage our employees and create value for our shareholders.

Horizon Global is home to some of the world’s most recognized brands in the towing and trailering industry, including: BULLDOG, Draw-Tite, Fulton, Hayman Reese, Reese, ROLA, Tekonsha, and Westfalia. Horizon Global has approximately 4,300 employees in 58 facilities across 21 countries.

For more information, please visit www.horizonglobal.com.

Safe Harbor Statement

This release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements contained herein speak only as of the date they are made and give our current expectations or forecasts of future events. These forward-looking statements can be identified by the use of forward-looking words, such as “may,” “could,” “should,” “estimate,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “target,” “plan” or other comparable words, or by discussions of strategy that may involve risks and uncertainties. These forward-looking statements are subject to numerous assumptions, risks and uncertainties which could materially affect our business, financial condition or future results including, but not limited to, risks and uncertainties with respect to: the Company’s leverage; liabilities imposed by the Company’s debt instruments; market demand; competitive factors; supply constraints; material and energy costs; technology factors; litigation; government and regulatory actions, including the impact of any tariffs, quotas or surcharges; the Company’s accounting policies; future trends; general economic and currency conditions; various conditions specific to the Company’s business and industry; the spin-off from TriMas Corporation; the success of our Action Plan, including the actual amount of savings and timing thereof; risks inherent in the achievement of cost synergies and timing thereof in connection with the Westfalia acquisition, including whether the acquisition will be accretive; the Company’s ability to promptly and effectively integrate Westfalia; the performance and costs of integration of Westfalia; the timing and amount of repurchases of the Company’s common stock, if any; and other risks that are discussed in the Company’s most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. The risks described herein are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deemed to be immaterial also may materially adversely affect our business, financial position and results of operations or cash flows. We caution readers not to place undue reliance on such statements, which speak only as of the date hereof. We do not undertake any obligation to review or confirm analysts’ expectations or estimates or to release publicly any revisions to any forward-looking statement to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.

(1)   Please refer to “Company and Business Segment Financial Information,” which details certain costs, expenses, other charges, gains or income, collectively described as ‘’Special Items,’’ that are included in the determination of operating profit under GAAP, but that management would not consider important in evaluating the quality of the Company’s operating results as they are not indicative of the Company’s core operating results or may obscure trends useful in evaluating the Company’s continuing activities. Accordingly, the Company presents adjusted operating profit excluding these Special Items to help investors evaluate our operating performance and trends in our business consistent with how management evaluates such performance and trends. Further, the Company presents adjusted operating profit excluding these Special Items to provide investors with a better understanding of the Company’s view of our results as compared to prior periods.   (2) Appendix I details certain costs, expenses, other charges, gains or income, collectively described as “Special Items,” that are included in the determination of net income under GAAP, but that management would not consider important in evaluating the quality of the Company’s operating results as they are not indicative of the Company’s core operating results or may obscure trends useful in evaluating the Company’s continuing activities. Accordingly, the Company presents adjusted net income and adjusted diluted earnings per share excluding these Special Items to help investors evaluate our operating performance and trends in our business consistent with how management evaluates such performance and trends.   (3) We evaluate growth in our operations on both an as reported basis and a constant currency basis. The constant currency presentation, which is a non-GAAP measure, excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our growth, consistent with how we evaluate our performance. Constant currency revenue results are calculated by translating current period revenue in local currency using the prior period’s currency conversion rate. This non-GAAP measure has limitations as an analytical tool and should not be considered in isolation or as a substitute for an analysis of our results as reported under GAAP. Our use of this term may vary from the use of similarly-titled measures by other issuers due to the potential inconsistencies in the method of calculation and differences due to items subject to interpretation. See Appendix II for reconciliation.      

Horizon Global Corporation

Condensed Consolidated Balance Sheets

(Unaudited - dollars in thousands)

    June 30, 2018 December 31, 2017 Assets Current assets: Cash and cash equivalents $ 28,890 $ 29,570 Receivables, net of reserves of approximately $4.3 million and $3.1 million at June 30, 2018 and December 31, 2017, respectively 128,480 91,770 Inventories 167,530 171,500 Prepaid expenses and other current assets 10,710   10,950   Total current assets 335,610 303,790 Property and equipment, net 108,430 113,020 Goodwill 37,710 138,190 Other intangibles, net 83,770 90,230 Deferred income taxes 5,380 4,290 Other assets 9,640   11,510   Total assets $ 580,540   $ 661,030   Liabilities and Shareholders' Equity Current liabilities: Current maturities, long-term debt $ 10,170 $ 16,710 Accounts payable 140,160 138,730 Accrued liabilities 60,850   53,070   Total current liabilities 211,180 208,510 Long-term debt 310,720 258,880 Deferred income taxes 13,840 14,870 Other long-term liabilities 29,720   38,370   Total liabilities 565,460 520,630 Commitments and contingent liabilities — — Total Horizon Global shareholders' equity 17,120 141,890 Noncontrolling interest (2,040 ) (1,490 ) Total shareholders' equity 15,080   140,400   Total liabilities and shareholders' equity $ 580,540   $ 661,030          

Horizon Global Corporation

Condensed Consolidated Statements of Income

(Unaudited - dollars in thousands, except per share amounts)

    Three months endedJune 30, Six months endedJune 30, 2018   2017 2018   2017 Net sales $ 233,340 $ 253,590 $ 450,150 $ 456,870 Cost of sales (185,770 ) (185,920 ) (364,130 ) (343,810 ) Gross profit 47,570 67,670 86,020 113,060 Selling, general and administrative expenses (56,010 ) (43,430 ) (104,300 ) (89,480 ) Impairment (55,700 ) —   (99,130 ) —   Operating profit (loss) (64,140 ) 24,240   (117,410 ) 23,580   Other expense, net: Interest expense (6,190 ) (5,220 ) (12,140 ) (11,110 ) Loss on extinguishment of debt — — — (4,640 ) Other expense, net (6,610 ) (700 ) (7,730 ) (1,250 ) Other expense, net (12,800 ) (5,920 ) (19,870 ) (17,000 ) Income (loss) before income tax benefit (76,940 ) 18,320 (137,280 ) 6,580 Income tax benefit 9,780   1,650   12,360   3,230   Net income (loss) (67,160 ) 19,970 (124,920 ) 9,810 Less: Net loss attributable to noncontrolling interest (230 ) (290 ) (480 ) (590 ) Net income (loss) attributable to Horizon Global $ (66,930 ) $ 20,260   $ (124,440 ) $ 10,400   Net income (loss) per share attributable to Horizon Global: Basic $ (2.68 ) $ 0.80 $ (4.98 ) $ 0.42 Diluted $ (2.68 ) $ 0.79 $ (4.98 ) $ 0.42 Weighted average common shares outstanding: Basic 25,017,725 25,385,395 24,990,573 24,616,939 Diluted 25,017,725 25,743,077 24,990,573 25,044,653      

Horizon Global Corporation

Condensed Consolidated Statements of Cash Flows

(Unaudited - dollars in thousands)

    Six months endedJune 30, 2018   2017 Cash Flows from Operating Activities: Net income (loss) $ (124,920 ) $ 9,810 Adjustments to reconcile net income (loss) to net cash used for operating activities: Net loss on dispositions of property and equipment 380 — Depreciation 8,240 6,510 Amortization of intangible assets 4,140 4,960 Impairment of goodwill and intangible assets 99,130 — Amortization of original issuance discount and debt issuance costs 3,870 3,240 Deferred income taxes (1,850 ) 970 Loss on extinguishment of debt — 4,640 Non-cash compensation expense 1,210 1,830 Increase in receivables (40,450 ) (40,380 ) (Increase) decrease in inventories 530 (5,570 ) Decrease in prepaid expenses and other assets 1,510 970 Increase (decrease) in accounts payable and accrued liabilities 12,590 (1,460 ) Other, net 260   (110 ) Net cash used for operating activities (35,360 ) (14,590 ) Cash Flows from Investing Activities: Capital expenditures (7,790 ) (13,340 ) Net proceeds from disposition of property and equipment 140   940   Net cash used for investing activities (7,650 ) (12,400 ) Cash Flows from Financing Activities: Proceeds from borrowings on credit facilities 2,630 220 Repayments of borrowings on credit facilities (8,670 ) (2,890 ) Repayments of borrowings on Term B Loan, inclusive of transaction costs (3,940 ) (185,800 ) Proceeds from ABL Revolving Debt 66,110 82,400 Repayments of borrowings on ABL Revolving Debt (13,510 ) (62,400 ) Proceeds from issuance of common stock, net of offering costs — 79,920 Repurchase of common stock — (8,360 ) Proceeds from issuance of Convertible Notes, net of issuance costs — 120,950 Proceeds from issuance of Warrants, net of issuance costs — 20,930 Payments on Convertible Note Hedges, inclusive of issuance costs — (29,680 ) Other, net (210 ) (240 ) Net cash provided by financing activities 42,410   15,050   Effect of exchange rate changes on cash (80 ) 1,270   Cash and Cash Equivalents: Decrease for the period (680 ) (10,670 ) At beginning of period 29,570   50,240   At end of period $ 28,890   $ 39,570   Supplemental disclosure of cash flow information: Cash paid for interest $ 7,550   $ 7,220   Cash paid for taxes $ 3,770   $ 4,720                    

Horizon Global Corporation

Condensed Consolidated Statements of Shareholders’ Equity

(Unaudited - dollars in thousands)

    CommonStock Paid-inCapital

Treasury Stock

Accumulated Deficit

AccumulatedOther Comprehensive Income

Total Horizon Global Shareholders’ Equity

Noncontrolling Interest

Total Shareholders’ Equity

Balance at December 31, 2017 $ 250 $ 159,490 $ (10,000 ) $ (17,860 ) $ 10,010 $ 141,890 $ (1,490 ) $ 140,400 Net loss — — — (124,440 ) — (124,440 ) (480 ) (124,920 ) Other comprehensive income, net of tax — — — — (1,330 ) (1,330 ) (70 ) (1,400 ) Shares surrendered upon vesting of employees' share based payment awards to cover tax obligations — (210 ) — — — (210 ) — (210 ) Non-cash compensation expense —   1,210   —   —   —   1,210   —   1,210   Balance at June 30, 2018 $ 250   $ 160,490   $ (10,000 ) $ (142,300 ) $ 8,680   $ 17,120   $ (2,040 ) $ 15,080      

Horizon Global CorporationCompany and Business Segment Financial Information(Unaudited - dollars in thousands)

We evaluate certain costs, expenses, other charges, gains or income, collectively described as “Special Items,” that are included in the determination of operating profit under GAAP, but that management would not consider important in evaluating the quality of the Company’s operating results as they are not indicative of the Company’s core operating results or may obscure trends useful in evaluating the Company’s continuing activities. Accordingly, the Company presents adjusted operating profit excluding these Special Items to help investors evaluate our operating performance and trends in our business consistent with how management evaluates such performance and trends.

      Three months ended June 30, Six months ended June 30, 2018   2017 2018   2017 Horizon Americas Net sales $ 108,080 $ 138,110 $ 204,300 $ 235,940 Operating profit (loss) $ 2,570 $ 22,750 $ (2,540 ) $ 27,910 Special Items to consider in evaluating operating profit (loss): Severance $ 3,660 $ — $ 4,350 $ — Distribution center inefficiencies & fines $ 2,990 $ — $ 5,100 $ — Restructuring $ 1,420 $ — $ 2,510 $ — Adjusted operating profit $ 10,640 $ 22,750 $ 9,420 $ 27,910   Horizon Europe-Africa Net sales $ 90,840 $ 86,580 $ 177,900 $ 165,120 Operating profit (loss) $ (55,690 ) $ 3,610 $ (100,780 ) $ 3,270 Special Items to consider in evaluating operating profit (loss): Severance $ 1,180 $ 570 $ 1,560 $ 2,640 Acquisition & integration $ 240 $ 450 $ 660 $ 270 Impairment of goodwill & other intangibles $ 55,700 $ — $ 99,130 $ — Restructuring $ 1,000 $ 40 $ 1,450 $ 90 Brink Group transaction & termination costs $ 180 $ — $ 660 $ — Adjusted operating profit $ 2,610 $ 4,670 $ 2,680 $ 6,270   Horizon Asia-Pacific Net sales $ 34,420 $ 28,900 $ 67,950 $ 55,810 Operating profit $ 4,670 $ 4,290 $ 9,060 $ 7,360 Special Items to consider in evaluating operating profit: Severance $ 70 $ 270 $ 70 $ 270 Acquisition & integration costs $ 20 $ 20 $ 20 $ 20 Restructuring $ 100 $ 30 $ 100 $ 30 Adjusted operating profit $ 4,860 $ 4,610 $ 9,250 $ 7,680   Corporate Expenses Operating loss $ (15,690 ) $ (6,410 ) $ (23,150 ) $ (14,960 ) Special Items to consider in evaluating operating loss: Acquisition & integration $ (360 ) $ 250 $ 50 $ 2,580 Brink Group transaction & termination costs $ 8,940 $ — $ 9,810 $ — Restructuring $ — $ 250 $ — $ 250 CEO separation costs & severance $ 2,750 $ — $ 2,750 $ — Adjusted operating loss $ (4,360 ) $ (5,910 ) $ (10,540 ) $ (12,130 )   Total Company Net sales $ 233,340 $ 253,590 $ 450,150 $ 456,870 Operating profit (loss) $ (64,140 ) $ 24,240 $ (117,410 ) $ 23,580 Total Special Items to consider in evaluating operating profit (loss) $ 77,890 $ 1,880 $ 128,220 $ 6,150 Adjusted operating profit $ 13,750 $ 26,120 $ 10,810 $ 29,730    

Appendix I

Horizon Global CorporationAdditional Information Regarding Special Items ImpactingReported GAAP Financial Measures(Unaudited - dollars in thousands, except per share amounts)

This appendix details certain costs, expenses, other charges, gains or income, collectively described as ‘’Special Items,’’ that are included in the determination of net income (loss) and earnings (loss) per share under GAAP, but that management would not consider important in evaluating the quality of the Company’s operating results as they are not indicative of the Company’s core operating results or may obscure trends useful in evaluating the Company’s continuing activities. Accordingly, the Company presents adjusted net income (loss) and adjusted diluted earnings (loss) per share excluding these Special Items to help investors evaluate our operating performance and trends in our business consistent with how management evaluates such performance and trends.

      Three months endedJune 30, Six months endedJune 30, 2018   2017 2018   2017 Net income (loss) attributable to Horizon Global, as reported $ (66,930 ) $ 20,260 $ (124,440 ) $ 10,400 Impact of Special Items to consider in evaluating quality of income (loss): Impairment of goodwill & other intangibles 55,700 — 99,130 — Brink Group transaction & termination costs 13,620 — 15,600 — Severance 4,920 840 5,980 2,910 Distribution center inefficiencies & fines 2,990 — 5,100 — CEO separation costs & severance 2,750 — 2,750 — Restructuring 2,520 310 4,070 370 Acquisition & integration costs (110 ) 730 720 2,870 Loss on extinguishment of debt — — — 4,640 Tax impact of Special Items (6,390 ) (450 ) (7,900 ) (3,560 ) Adjusted net income attributable to Horizon Global $ 9,070   $ 21,690   $ 1,010   $ 17,630       Three months endedJune 30, Six months endedJune 30, 2018 2017 2018 2017 Diluted earnings (loss) per share attributable to Horizon Global, as reported $ (2.68 ) $ 0.79 $ (4.98 ) $ 0.42 Impact of Special Items to consider in evaluating quality of EPS: Impairment of goodwill & other intangibles 2.23 — 3.97 — Brink Group transaction & termination costs 0.54 — 0.62 — Severance 0.20 0.03 0.24 0.12 Distribution center inefficiencies & fines 0.12 — 0.21 — CEO separation costs & severance 0.11 — 0.11 — Restructuring 0.10 0.01 0.16 0.01 Acquisition & integration costs — 0.03 0.03 0.11 Loss on extinguishment of debt — — — 0.19 Tax impact of Special Items (0.26 ) (0.02 ) (0.32 ) (0.14 ) Impact of change in dilutive shares outstanding due to Special Items —   —   —   —   Adjusted earnings per share attributable to Horizon Global $ 0.36   $ 0.84   $ 0.04   $ 0.71     Weighted average shares outstanding, diluted, as reported 25,017,725 25,743,077 24,990,573 25,044,653 Dilution effect on adjusted net income 266,876   —   307,834   —  

Diluted weighted-average shares outstanding, as adjusted

25,284,601   25,743,077   25,298,407   25,044,653      

Appendix II

Horizon Global CorporationReconciliation of Reported Revenue Growthto Constant Currency Basis(Unaudited)

We evaluate growth in our operations on both an as reported and a constant currency basis. The constant currency presentation, which is a non-GAAP measure, excludes the impact of fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our growth, consistent with how we evaluate our performance. Constant currency revenue results are calculated by translating current year revenue in local currency using the prior year's currency conversion rate. This non-GAAP measure has limitations as an analytical tool and should not be considered in isolation or as a substitute for an analysis of our results as reported under GAAP. Our use of this term may vary from the use of similarly-titled measures by other issuers due to the potential inconsistencies in the method of calculation and differences due to items subject to interpretation.

      Three months endedJune 30, 2018 Six months endedJune 30, 2018

Horizon Americas

 

Horizon

Europe-Africa

 

Horizon

Asia-Pacific

  Consolidated

Horizon Americas

 

Horizon Europe-Africa

 

Horizon

Asia-Pacific

  Consolidated Revenue growth as reported (21.7 )% 4.9 % 19.1 % (8.0 )% (13.4 )% 7.7 % 21.8 %   (1.5 )% Less: currency impact (0.2 )% 7.1 % 1.6 % 2.5 % (0.1 )% 10.6 % 3.5 % 4.2 % Revenue growth at constant currency (21.5 )% (2.2 )% 17.5 % (10.5 )% (13.3 )% (2.9 )% 18.3 % (5.7 )%    

Appendix III

Horizon Global CorporationLTM Bank EBITDA as Defined in Credit Agreement(Unaudited - dollars in thousands)

This appendix reconciles net income to “Consolidated Bank EBITDA” as defined in our credit agreement. We believe this reconciliation provides valuable supplemental information regarding our capital structure, consistent with how we evaluate our performance.

          Less: Add:

Year Ended December 31, 2017

Six Months Ended June 30, 2017

Six Months Ended June 30, 2018

Twelve Months EndedJune 30, 2018

Net loss attributable to Horizon Global $ (3,550 ) $ 10,400 $ (124,440 ) $ (138,390 ) Bank stipulated adjustments: Interest expense, net (as defined) 22,410 11,110 17,270 28,570 Income tax (benefit) expense 9,750 (3,230 ) (12,360 ) 620 Depreciation and amortization 25,340 11,470 12,380 26,250 Extraordinary charges 2,520 — 13,740 16,260 Non-cash compensation expense(a) 3,630 1,830 1,210 3,010 Other non-cash expenses or losses 2,180 480 99,620 101,320 Pro forma EBITDA of permitted acquisition 840 840 — — Interest-equivalent costs associated with any Specified Vendor Receivables Financing 1,490 620 810 1,680 Debt extinguishment costs 4,640 4,640 — — Items limited to a % of consolidated EBITDA(b): Non-recurring expenses (c) 2,440 — 6,240 8,680 Acquisition integration costs (d) 11,210 5,580 3,140 8,770 Synergies related to permitted acquisition (e) 1,480   1,480   —   —   Consolidated Bank EBITDA, as defined $ 84,380   $ 45,220   $ 17,610   $ 56,770               June 30, 2018 Total Consolidated Indebtedness (f) $ 323,256 Consolidated Bank EBITDA, as defined 56,770   Actual leverage ratio 5.69 x Covenant requirement 7.00 x _________________________________ (a)   Non-cash compensation expenses resulting from the grant of restricted shares of common stock and common stock options. (b) Under the Fourth Amendment effective June 30, 2018, the EBITDA limitation for nonrecurring expenses or costs was increased from 25% of Consolidated EBITDA for the period to 45% of Consolidated EBITDA for the period. As such, the amounts added to Consolidated Net Income pursuant to items b-d shall not exceed 45% of Consolidated EBITDA, excluding these items, for such period. (c) Under the Amended Term Loan Amendment, costs and expenses related to cost savings projects, including restructuring and severance expenses, are not to exceed $5 million in any fiscal year and $20 million in aggregate, commencing on or after January 1, 2015. The Fourth Amendment has raised the annual cap to $7.5 million in any fiscal year and $25 million in aggregate. (d) Under the 2018 Term Loan Agreement, costs and expenses related to the integration of the Westfalia Group acquisition, are not to exceed $10 million in any fiscal year and $30 million in aggregate, or other permitted acquisitions are not to exceed $7.5 million in any fiscal year and $20 million in aggregate. (e) Under the 2018 Term Loan Agreement, the add back for the amount of reasonably identifiable and factually supportable “run rate” cost savings, operating expense reductions, and other synergies cannot exceed $12.5 million for the Westfalia Group acquisition. (f) “Total Consolidated Indebtedness” refers to the sum of “long-term debt” and “current maturities, long-term debt”, with our Convertible Notes at their face value of $125.0 million and less unrestricted cash. Unrestricted cash included in the calculation was $28.9 million as of June 30, 2018.

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Horizon Global CorporationChristi CowdinDirector, Corporate Communications & Investor Relations(248) 593-8810ccowdin@horizonglobal.com