Kaiser Aluminum Corporation (NASDAQ:KALU), a leading producer of
semi-fabricated specialty aluminum products serving customers
worldwide with highly-engineered solutions for aerospace and
high-strength, packaging, general engineering, custom automotive
and other industrial applications, today announced fourth quarter
and full year 2022 results.
As announced on January 26, 2023, the Company renamed its
previously used non-GAAP financial measure “value added revenue”,
or “VAR”, to “Conversion Revenue.” In addition, effective January
1, 2022, the Company prospectively changed its approach from
including a portion of alloyed metal cost within Hedged Cost of
Alloyed Metal to include all alloyed metal cost. This approach is
in further alignment with the Company’s change in pricing and
certain customer-renegotiated contracts to more fully pass through
alloy cost due to the high inflationary and historically
unprecedented volatility of these costs starting in early 2022. The
Company further announced on January 26, 2023, the revision of its
presentation of Adjusted EBITDA to no longer adjust the Company’s
operating results for the impact of the last-in, first out
inventory valuation ("LIFO") calculated on an annual basis to LIFO
calculated on a monthly basis done at a plant level, previously
identified as “Adjustments to plant-level LIFO”. This change had a
consequential impact on certain other non-GAAP measures including:
Operating income, excluding operating non-run-rate (“NRR”) items,
Adjusted net income (loss) and Adjusted earnings (loss) per diluted
share.
2022 Management Commentary
“The full year 2022 was pivotal in Kaiser’s evolution as we laid
the necessary groundwork to position the Company for long-term,
sustainable growth despite the numerous challenges we encountered,
including unprecedented supply chain disruptions, inflationary cost
pressures and labor turnover, which negatively impacted our
financial performance,” said Keith A. Harvey, President and Chief
Executive Officer. “We continue to work with our customers to
negotiate improvements to commodity price adjustments to mitigate
the impact of inflationary and volatile commodity costs on our
business and improve our margin profile. We are prioritizing
investments in our growth through our roll coat capacity expansion
project at Warrick, which we expect will become operational by
mid-to-late 2024. In addition, we remain well positioned to service
the recovery we have been experiencing in aerospace and continued
demand for general engineering (plate) following the completion of
a long planned, major outage at our Trentwood facility in the third
quarter of 2022.”
Mr. Harvey continued, “Looking ahead, we remain intently focused
on continuing to pursue cost reductions in our operations, as well
as improving efficiencies and implementing commercial actions to
increase our margins. We believe the strategy we have in place
should lead to improved performance in the year ahead with our full
year 2022 Adjusted EBITDA representing the trough. While our
efforts will take time to manifest, we are confident in our ability
to execute given our solid market position as a key supplier, focus
on diverse end markets with strong secular growth characteristics,
deep customer relationships and multi-year contracts with strategic
partners.”
Fourth Quarter and Full Year 2022
Consolidated Results
(Unaudited)*
(In millions of dollars, except shipments,
realized price and per share amounts)
|
|
Quarterly |
|
|
December 31, |
|
|
|
4Q22 |
|
|
3Q22 |
|
|
4Q21 |
|
|
2022 |
|
|
2021 |
|
Shipments (millions of lbs.) |
|
|
302 |
|
|
|
282 |
|
|
|
333 |
|
|
|
1,254 |
|
|
|
1,122 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
776 |
|
|
$ |
749 |
|
|
$ |
806 |
|
|
$ |
3,428 |
|
|
$ |
2,622 |
|
Less hedged cost of alloyed
metal1 |
|
|
(420 |
) |
|
|
(427 |
) |
|
|
(490 |
) |
|
|
(2,045 |
) |
|
|
(1,511 |
) |
Conversion revenue |
|
$ |
356 |
|
|
$ |
322 |
|
|
$ |
316 |
|
|
$ |
1,383 |
|
|
$ |
1,111 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized price per pound
($/lb.) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
|
$ |
2.57 |
|
|
$ |
2.66 |
|
|
$ |
2.42 |
|
|
$ |
2.73 |
|
|
$ |
2.34 |
|
Less hedged cost of alloyed
metal |
|
|
(1.39 |
) |
|
|
(1.52 |
) |
|
|
(1.47 |
) |
|
|
(1.63 |
) |
|
|
(1.35 |
) |
Conversion revenue |
|
$ |
1.18 |
|
|
$ |
1.14 |
|
|
$ |
0.95 |
|
|
$ |
1.10 |
|
|
$ |
0.99 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As reported |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss) income |
|
$ |
(22 |
) |
|
$ |
3 |
|
|
$ |
17 |
|
|
$ |
4 |
|
|
$ |
64 |
|
Net (loss) income |
|
$ |
(26 |
) |
|
$ |
3 |
|
|
$ |
2 |
|
|
$ |
(30 |
) |
|
$ |
(19 |
) |
Net (loss) income per share, diluted2 |
|
$ |
(1.66 |
) |
|
$ |
0.16 |
|
|
$ |
0.11 |
|
|
$ |
(1.86 |
) |
|
$ |
(1.17 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income |
|
$ |
3 |
|
|
$ |
3 |
|
|
$ |
22 |
|
|
$ |
35 |
|
|
$ |
93 |
|
EBITDA4 |
|
$ |
30 |
|
|
$ |
29 |
|
|
$ |
49 |
|
|
$ |
142 |
|
|
$ |
185 |
|
EBITDA margin5 |
|
|
8.4 |
% |
|
|
8.9 |
% |
|
|
15.5 |
% |
|
|
10.3 |
% |
|
|
16.6 |
% |
Net (loss) income |
|
$ |
(7 |
) |
|
$ |
5 |
|
|
$ |
5 |
|
|
$ |
(2 |
) |
|
$ |
33 |
|
EPS, diluted2 |
|
$ |
(0.45 |
) |
|
$ |
0.29 |
|
|
$ |
0.33 |
|
|
$ |
(0.14 |
) |
|
$ |
2.03 |
|
- Hedged Cost of Alloyed Metal for 4Q22, 3Q22, 4Q21 and full year
2022 and 2021 was comprised of $414.3 million, $408.7 million,
$503.4 million, $2,028.2 million and $1,552.4 million,
respectively, reflecting the cost of aluminum at the average
Midwest Transaction Price and the cost of alloys used in the
production process, as well as metal price exposure on shipments
that the Company hedged with realized losses upon settlement of
$6.1 million, $18.4 million and a realized gain of $13.4 million in
4Q22, 3Q22 and 4Q21, respectively, and realized loss upon
settlement of $17.0 million and a realized gain of $41.6 million in
full year 2022 and 2021, respectively, all of which were included
within both Net sales and Cost of products sold, excluding
depreciation and amortization and other items in the Company’s
Statements of Consolidated (Loss) Income.
- Diluted shares for EPS are calculated
using the treasury stock method.
- Adjusted numbers exclude non-run-rate
items. For all Adjusted numbers and EBITDA refer to Reconciliation
of Non-GAAP Measures.
- Adjusted EBITDA = Consolidated
operating income, excluding operating non-run-rate items, plus
Depreciation and amortization.
- Adjusted EBITDA margin = Adjusted
EBITDA as a percent of Conversion Revenue.
* Please refer to GAAP financial statements.
Totals may not sum due to
rounding.
Fourth Quarter 2022 Financial Highlights
Net sales for the fourth quarter 2022 decreased to $776 million
compared to $806 million in the prior year period, reflecting a 9%
decrease in shipments and a 6% increase in average selling price
per pound. The increase in average selling price reflected a 24%
increase in conversion revenue per pound and a 5% decrease in
underlying contained metal costs.
Conversion revenue for the fourth quarter 2022 was $356 million.
The impact of the aforementioned change to include all alloyed
metal cost within Hedged Cost of Alloyed Metal in comparison to the
Company’s historical presentation resulted in a reduction of
approximately $37 million in conversion revenue for the fourth
quarter of 2022.
- Conversion revenue for the Company’s aerospace/high strength
applications was $103 million, a 25% increase, after adjusting for
an incremental $8 million of alloyed metal cost, on a 28% increase
in shipments over the prior year quarter. The improvement in
shipments reflected improving demand for commercial aerospace and
strong plate shipments following the planned stretcher outage at
the Company’s Trentwood facility in the third quarter of 2022.
- Conversion revenue for packaging applications was $134 million,
a 2% increase, after adjusting for an incremental $23 million of
alloyed metal cost, on a 16% decrease in shipments over the prior
year quarter. The decline in shipments primarily reflects the
impact of the force majeure declared during the third quarter of
2022 in addition to some destocking in the beverage can
market.
- Conversion revenue for general engineering applications was $92
million, a 26% increase, after adjusting for an incremental $4
million of alloyed metal cost, on a 7% decrease in shipments due to
normal seasonality and destocking at service centers for the
Company's extruded products.
- Conversion revenue for automotive extrusions was $25 million, a
10% increase, after adjusting for an incremental $2 million of
alloyed metal cost, on a 6% increase in shipments primarily
reflecting improved pricing.
Reported net loss for the fourth quarter 2022 was $26 million,
or $1.66 loss per diluted share, compared to net income and net
income per diluted share of $2 million and $0.11, respectively, in
the prior year period. Excluding the impact of pre-tax,
non-run-rate items of $25 million, adjusted net loss was $7 million
for the fourth quarter 2022, compared to adjusted net income of $5
million in the prior year period. Adjusted loss per diluted share
was $0.45 for the fourth quarter 2022, compared to adjusted income
per diluted share of $0.33 for the fourth quarter 2021.
Adjusted EBITDA of $30 million in the fourth quarter 2022
decreased $19 million compared to the prior year period. In
addition to higher inflationary manufacturing cost, the fourth
quarter of 2022 was impacted by $19 million of incremental cost
driven by an inventory imbalance due to previous quarter supply
chain disruptions and unrecovered alloy cost. Adjusted EBITDA as a
percentage of conversion revenue was 8.4% in the fourth quarter
2022.
Full Year 2022 Financial Results
Net sales for the full year 2022 were $3.4 billion compared to
$2.6 billion in the prior year period, reflecting a 12% increase in
shipments and a 17% increase in average selling price per pound.
The increase in average selling price reflected an approximately
11% increase in conversion revenue per pound and a 21% increase in
underlying contained metal costs.
Conversion revenue for the full year 2022 was $1.4 billion. The
impact of the aforementioned change to include all alloyed metal
cost within Hedged Cost of Alloyed Metal in comparison to the
Company’s historical presentation resulted in a reduction of
approximately $112 million in conversion revenue for 2022.
- Conversion revenue for the Company’s aerospace/high strength
applications was $356 million, a 13% increase, after adjusting for
an incremental $32 million of alloyed metal cost, on a 15% increase
in shipments over 2021. The improvement in shipments reflected
improving demand for commercial aerospace and continuing strong
demand for business jet and defense applications.
- Conversion revenue for packaging applications was $555 million,
a 42% increase, after adjusting for an incremental $49 million of
alloyed metal cost, on a 21% increase in shipments over 2021.
Packaging shipments in 2021 reflect only nine months of activity as
the acquisition of Warrick closed on March 31, 2021. In addition,
shipments in 2022 were negatively impacted by the force majeure
declared during the third quarter of 2022.
- Conversion revenue for general engineering applications was
$367 million, a 23% increase, after adjusting for an incremental
$22 million of alloyed metal cost, on a 2% increase in shipments
over 2021. Conversion revenue was supported by improved pricing
which was partially offset by service center destocking for the
Company's extruded products and the impact from the planned
stretcher outage at the Company’s Trentwood facility in the third
quarter of 2022.
- Conversion revenue for automotive extrusions was $96 million,
relatively consistent with 2021, after adjusting for an incremental
$7 million of alloyed metal cost, on a 3% increase in shipments,
primarily reflecting improved pricing and mix as market demand
remained stable amid persistent industry supply chain issues.
Reported net loss for the full year 2022 was $30 million, or
$1.86 loss per diluted share, compared to a net loss and loss per
diluted share of $19 million and $1.17, respectively, for the prior
year period. Excluding the impact of pre-tax, non-run-rate items of
$31 million, adjusted net loss was $2 million for the full year
2022, compared to adjusted net income of $33 million for the prior
year period. Adjusted loss per diluted share was $0.14 for the full
year 2022, compared to adjusted income per diluted share of $2.03
for the prior year period.
Adjusted EBITDA of $142 million in the full year 2022 decreased
$43 million compared to the prior year period. The decline
predominantly reflected significant supply chain issues
specifically related to magnesium and hot metal supply at the
Company’s Warrick operation and reduced packaging and plate
shipments in the third quarter 2022, due to the magnesium related
force majeure coupled with the planned outage at its Trentwood
operation. In addition, higher inflationary driven costs during the
year, which the Company is aggressively working to offset through
pricing actions, cost reduction efforts and efficiency improvement
projects, further affected results. Adjusted EBITDA as a percentage
of conversion revenue was approximately 10.3% in the full year
2022.
Cash Flow and Liquidity
Adjusted EBITDA of $142 million reported in the full year 2022
and cash on hand funded approximately $170 million of working
capital requirements, $143 million of capital investments, $46
million of interest payments, $50 million of cash returned to
shareholders through quarterly dividends and $6 million of cash
taxes.
As of December 31, 2022, the Company had cash and cash
equivalents of approximately $57 million and borrowing availability
under the Company's revolving credit facility of approximately $558
million providing total liquidity of $615 million. There were no
borrowings under the revolving credit facility during the
quarter.
On January 12, 2023, the Company’s Board of Directors declared a
quarterly cash dividend of $0.77 per share which was paid on
February 15, 2023 to stockholders of record as of the close of
business on January 25, 2023.
2023 Outlook
The Company remains well positioned to navigate the current
demand environment prevailing in its end markets in 2023. The
Company expects demand in commercial aerospace to continue to
strengthen throughout 2023 towards pre-pandemic levels with both
business jet and defense remaining strong. In packaging, the
Company expects its operations will return to more normalized
levels in 2023 now that the most significant supply chain issues
have been resolved, despite continuing impacts from higher metal
costs and a lag in passing through certain costs. General
Engineering demand is expected to soften for plate and rod &
bar products on stable pricing levels as distributors destock
inventories after taking advantage of lower metal prices in the
second half of 2022. In the Automotive market, the Company does not
expect a meaningful recovery until mid-to late 2023.
The Company is cautiously optimistic its consolidated adjusted
EBITDA and adjusted EBITDA margin will begin to strengthen in 2023
as it returns to more normalized costs, improved efficiencies and
continued commercial actions. For the first quarter 2023, the
Company expects its consolidated adjusted EBITDA margin to improve
by approximately 200 basis points from the fourth quarter 2022.
Given continued strong inflationary pressures, ongoing
macroeconomic uncertainty and recessionary concerns, the Company
will not be providing an outlook for its full year 2023
consolidated adjusted EBITDA.
The Company’s capital investment plans remain focused on
supporting demand growth through capacity expansion, sustaining its
operations, enhancing product quality and increasing operating
efficiencies. The Company anticipates total capital investments in
2023 will be in the range of $170 million to $190 million, of which
approximately 60% will be focused on growth initiatives, primarily
reflecting investments in the new roll coat line at the Warrick
facility.
Conference Call
Kaiser Aluminum Corporation will host a conference call on
Thursday, February 23, 2023 at 11:00 am (Eastern Time); 10:00 am
(Central Time); 8:00 am (Pacific Time), to discuss its fourth
quarter and full year 2022 results. To participate, the conference
call can be directly accessed from the U.S. and Canada at (877)
423-9813, and accessed internationally at (201) 689-8573. The
conference call ID number is 13735668. A link to the simultaneous
webcast can be accessed on the Company’s website at
http://investors.kaiseraluminum.com/events.cfm. A copy of a
presentation will be available for download prior to the call and
an audio archive will be available on the Company’s website
following the call.
Company Description
Kaiser Aluminum Corporation, headquartered in Franklin, Tenn.,
is a leading producer of semi-fabricated specialty aluminum
products, serving customers worldwide with highly-engineered
solutions for aerospace and high-strength, packaging, general
engineering, custom automotive, and other industrial applications.
The Company’s North American facilities produce value-added plate,
sheet, coil, extrusions, rod, bar, tube, and wire products,
adhering to traditions of quality, innovation, and service that
have been key components of the culture since the Company was
founded in 1946. The Company’s stock is included in the Russell
2000® index and the S&P Small Cap 600® index.
Available Information
For more information, please visit the Company’s website at
www.kaiseraluminum.com. The website includes a section for investor
relations under which the Company provides notifications of news or
announcements regarding its financial performance, including
Securities and Exchange Commission (SEC) filings, investor events,
and earnings and other press releases. In addition, all Company
filings submitted to the SEC are available through a link to the
section of the SEC’s website at www.sec.gov, which includes: Annual
Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current
Reports on Form 8-K and Proxy Statements for the Company’s annual
stockholders’ meetings, and other information statements as filed
with the SEC. In addition, the Company provides a webcast of its
quarterly earnings calls and certain events in which management
participates or hosts with members of the investment community.
Non-GAAP Financial Measures
This earnings release contains certain non-GAAP financial
measures. A “non-GAAP financial measure” is defined as a numerical
measure of a company’s financial performance that excludes or
includes amounts so as to be different than the most directly
comparable measure calculated and presented in accordance with GAAP
in the statements of income, balance sheets, or statements of cash
flow of the Company. Pursuant to the requirements of Regulation G,
the Company has provided a reconciliation of non-GAAP financial
measures to the most directly comparable financial measure in the
accompanying tables.
The non-GAAP financial measures used within this earnings
release are conversion revenue, adjusted operating income, adjusted
EBITDA, adjusted net income, and adjusted earnings per diluted
share which exclude non-run-rate items and ratios related thereto.
As more fully described in these reports, “non-run-rate” items are
items that, while they may occur from period to period, are
particularly material to results, impact costs primarily as a
result of external market factors and may not occur in future
periods if the same level of underlying performance were to occur.
These measures are presented because management uses this
information to monitor and evaluate financial results and trends
and believes this information to also be useful for investors.
Reconciliations of certain forward looking non-GAAP financial
measures to comparable GAAP measures are not provided because
certain items required for such reconciliations are outside of the
Company's control and/or cannot be reasonably predicted or provided
without unreasonable effort.
Forward-Looking Statements
This press release contains statements based on management’s
current expectations, estimates and projections that constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995 involving known and
unknown risks and uncertainties that may cause actual results,
performance or achievements of the Company to be materially
different from those expressed or implied. These factors include:
(a) the effectiveness of management's strategies and decisions,
including strategic investments, capital spending strategies
processes and countermeasures implemented to address operational
and supply chain challenges, and the execution of those strategies;
(b) general economic and business conditions, reshoring,
cyclicality, supply chain disruptions, and conditions that impact
demand drivers in the aerospace/high strength, aluminum beverage
and food packaging, general engineering, automotive and other end
markets the Company serves; (c) the Company’s ability to
participate in mature and anticipated new automotive programs
expected to launch in the future and successfully launch new
automotive programs; (d) changes or shifts in defense spending due
to competing national priorities; (e) pricing, market conditions
and the Company’s ability to effectively execute its commercial and
labor strategies, pass through cost increases, including the
institution of surcharges, and flex costs in response to inflation,
volatile commodity costs and changing economic conditions; (f)
developments in technology; (g) the impact of the Company's future
earnings, cash flows, financial condition, capital requirements and
other factors on its financial strength and flexibility; (h) new or
modified statutory or regulatory requirements; (i) the successful
integration of the acquired operations and technologies; (j) other
risk factors summarized in the Company's reports filed with the
Securities and Exchange Commission, including, when filed, the
Company's Form 10-K for the year ended December 31, 2022; and (k)
the completion of the audit of the Company’s financial statements
for the period ended December 31, 2022. All information in this
release is as of the date of the release. The Company undertakes no
duty to update any forward-looking statement to conform the
statement to actual results or changes in the Company’s
expectations.
Investor Relations and Public Relations
Contact:Addo Investor
RelationsInvestors@KaiserAluminum.com(949) 614-1769
Kaiser Aluminum Corporation and
Subsidiary Companies
Statements of Consolidated
Loss1
(In millions of dollars, except share and per
share amounts)
|
|
Year Ended December 31, |
|
|
|
2022 |
|
|
2021 |
|
Net sales |
|
$ |
3,427.9 |
|
|
$ |
2,622.0 |
|
Costs and expenses: |
|
|
|
|
|
|
Cost of products sold, excluding depreciation and amortization and
other items |
|
|
3,180.2 |
|
|
|
2,348.1 |
|
Depreciation and amortization |
|
|
106.9 |
|
|
|
91.5 |
|
Selling, general, administrative, research and development |
|
|
110.9 |
|
|
|
118.8 |
|
Goodwill impairment |
|
|
20.5 |
|
|
|
— |
|
Restructuring costs (benefit) |
|
|
2.2 |
|
|
|
(0.8 |
) |
Other operating charges, net |
|
|
3.2 |
|
|
|
— |
|
Total costs and expenses |
|
|
3,423.9 |
|
|
|
2,557.6 |
|
Operating income |
|
|
4.0 |
|
|
|
64.4 |
|
Other expense: |
|
|
|
|
|
|
Interest expense |
|
|
(48.3 |
) |
|
|
(49.5 |
) |
Other income (expense), net |
|
|
6.4 |
|
|
|
(38.9 |
) |
Loss before income taxes |
|
|
(37.9 |
) |
|
|
(24.0 |
) |
Income tax benefit |
|
|
8.3 |
|
|
|
5.5 |
|
Net loss |
|
$ |
(29.6 |
) |
|
$ |
(18.5 |
) |
Net loss per common share: |
|
|
|
|
|
|
Basic |
|
$ |
(1.86 |
) |
|
$ |
(1.17 |
) |
Diluted2 |
|
$ |
(1.86 |
) |
|
$ |
(1.17 |
) |
Weighted-average number of common
shares outstanding (in thousands): |
|
|
|
|
|
|
Basic |
|
|
15,906 |
|
|
|
15,836 |
|
Diluted2 |
|
|
15,906 |
|
|
|
15,836 |
|
- Please refer to the Company's Form 10-K for the year ended
December 31, 2022 for detail regarding the items in the table.
- Diluted shares for EPS are calculated using the treasury stock
method and were excluded from the computations in periods of net
loss per share as their inclusion would have been
anti-dilutive.
Kaiser Aluminum Corporation and
Subsidiary Companies
Consolidated Balance
Sheets1
(In millions of dollars, except share and per
share amounts)
|
|
As of December 31, |
|
|
|
2022 |
|
|
2021 |
|
ASSETS |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
57.4 |
|
|
$ |
303.2 |
|
Receivables: |
|
|
|
|
|
|
Trade receivables, net |
|
|
297.2 |
|
|
|
332.7 |
|
Other |
|
|
73.5 |
|
|
|
53.0 |
|
Contract assets |
|
|
58.6 |
|
|
|
63.2 |
|
Inventories |
|
|
525.4 |
|
|
|
404.6 |
|
Prepaid expenses and other current assets |
|
|
30.5 |
|
|
|
48.7 |
|
Total current assets |
|
|
1,042.6 |
|
|
|
1,205.4 |
|
Property, plant and equipment,
net |
|
|
1,013.2 |
|
|
|
955.2 |
|
Operating lease assets |
|
|
39.1 |
|
|
|
46.2 |
|
Deferred tax assets, net |
|
|
7.5 |
|
|
|
3.4 |
|
Intangible assets, net |
|
|
55.3 |
|
|
|
67.7 |
|
Goodwill |
|
|
18.8 |
|
|
|
39.3 |
|
Other assets |
|
|
112.3 |
|
|
|
105.2 |
|
Total |
|
$ |
2,288.8 |
|
|
$ |
2,422.4 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable |
|
$ |
305.1 |
|
|
$ |
351.4 |
|
Accrued salaries, wages and related expenses |
|
|
45.2 |
|
|
|
46.9 |
|
Other accrued liabilities |
|
|
68.4 |
|
|
|
58.4 |
|
Total current liabilities |
|
|
418.7 |
|
|
|
456.7 |
|
Long-term portion of operating
lease liabilities |
|
|
35.4 |
|
|
|
40.8 |
|
Pension and other postretirement
benefits |
|
|
69.3 |
|
|
|
92.5 |
|
Net liabilities of Salaried
VEBA |
|
|
16.5 |
|
|
|
20.6 |
|
Deferred tax liabilities |
|
|
4.9 |
|
|
|
10.5 |
|
Long-term liabilities |
|
|
74.7 |
|
|
|
72.5 |
|
Long-term debt |
|
|
1,038.1 |
|
|
|
1,036.3 |
|
Total liabilities |
|
|
1,657.6 |
|
|
|
1,729.9 |
|
Commitments and
contingencies |
|
|
|
|
|
|
Stockholders' equity: |
|
|
|
|
|
|
Preferred stock, 5,000,000 shares authorized at both December 31,
2022 and December 31, 2021; no shares were issued and
outstanding at December 31, 2022 and December 31, 2021 |
|
|
— |
|
|
|
— |
|
Common stock, par value $0.01, 90,000,000 shares authorized at both
December 31, 2022 and December 31, 2021; 22,776,042 shares
issued and 15,940,756 shares outstanding at
December 31, 2022; 22,700,404 shares issued and
15,865,118 shares outstanding at December 31, 2021 |
|
|
0.2 |
|
|
|
0.2 |
|
Additional paid in capital |
|
|
1,090.4 |
|
|
|
1,078.9 |
|
Retained earnings |
|
|
13.3 |
|
|
|
93.0 |
|
Treasury stock, at cost, 6,835,286 shares at both December 31, 2022
and December 31, 2021 |
|
|
(475.9 |
) |
|
|
(475.9 |
) |
Accumulated other comprehensive income (loss) |
|
|
3.2 |
|
|
|
(3.7 |
) |
Total stockholders' equity |
|
|
631.2 |
|
|
|
692.5 |
|
Total |
|
$ |
2,288.8 |
|
|
$ |
2,422.4 |
|
- Please refer to the Company's Form 10-K for the year ended
December 31, 2022 for detail regarding the items in the table.
Reconciliation of Non-GAAP Measures -
Consolidated
(Unaudited)
(In millions of dollars, except per share
amounts)
|
Quarter Ended December 31, |
|
|
Year Ended December 31, |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
GAAP net (loss) income |
$ |
(26.4 |
) |
|
$ |
1.7 |
|
|
$ |
(29.6 |
) |
|
$ |
(18.5 |
) |
Interest expense |
|
11.8 |
|
|
|
12.3 |
|
|
|
48.3 |
|
|
|
49.5 |
|
Other expense (income), net |
|
1.0 |
|
|
|
0.7 |
|
|
|
(6.4 |
) |
|
|
38.9 |
|
Income tax (benefit) provision |
|
(8.6 |
) |
|
|
1.9 |
|
|
|
(8.3 |
) |
|
|
(5.5 |
) |
GAAP operating (loss) income |
|
(22.2 |
) |
|
|
16.6 |
|
|
|
4.0 |
|
|
|
64.4 |
|
Mark-to-market (gain) loss1 |
|
(0.5 |
) |
|
|
(0.7 |
) |
|
|
1.4 |
|
|
|
1.4 |
|
Restructuring cost (benefit) |
|
2.2 |
|
|
|
— |
|
|
|
2.2 |
|
|
|
(0.8 |
) |
Acquisition cost2 |
|
— |
|
|
|
5.8 |
|
|
|
0.4 |
|
|
|
28.0 |
|
Goodwill impairment |
|
20.5 |
|
|
|
— |
|
|
|
20.5 |
|
|
|
— |
|
Non-cash asset impairment charge |
|
— |
|
|
|
— |
|
|
|
3.2 |
|
|
|
— |
|
Other operating NRR loss3,4 |
|
3.2 |
|
|
|
0.1 |
|
|
|
3.3 |
|
|
|
0.3 |
|
Operating income, excluding
operating NRR items |
|
3.2 |
|
|
|
21.8 |
|
|
|
35.0 |
|
|
|
93.3 |
|
Depreciation and amortization |
|
26.5 |
|
|
|
27.3 |
|
|
|
106.9 |
|
|
|
91.5 |
|
Adjusted EBITDA5 |
$ |
29.7 |
|
|
$ |
49.1 |
|
|
$ |
141.9 |
|
|
$ |
184.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net (loss) income |
$ |
(26.4 |
) |
|
$ |
1.7 |
|
|
$ |
(29.6 |
) |
|
$ |
(18.5 |
) |
Operating NRR items |
|
25.4 |
|
|
|
5.2 |
|
|
|
31.0 |
|
|
|
28.9 |
|
Non-operating NRR items6 |
|
0.9 |
|
|
|
0.6 |
|
|
|
3.7 |
|
|
|
38.1 |
|
Tax impact of above NRR items |
|
(7.1 |
) |
|
|
(2.2 |
) |
|
|
(7.3 |
) |
|
|
(15.9 |
) |
Adjusted net (loss) income |
$ |
(7.2 |
) |
|
$ |
5.3 |
|
|
$ |
(2.2 |
) |
|
$ |
32.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income per share,
diluted7 |
$ |
(1.66 |
) |
|
$ |
0.11 |
|
|
$ |
(1.86 |
) |
|
$ |
(1.17 |
) |
Adjusted (loss) earnings per
diluted share7 |
$ |
(0.45 |
) |
|
$ |
0.33 |
|
|
$ |
(0.14 |
) |
|
$ |
2.03 |
|
- Mark-to-market (gain) loss on derivative instruments
represents: (i) the reversal of mark-to-market (gain) loss on
hedges entered into prior to the adoption of Accounting Standards
Update No. 2017-12, Derivatives and Hedging (Topic 815): Targeted
Improvements to Accounting for Hedging Activities and settled in
the periods presented above and (ii) (gain) loss on non-designated
commodity hedges. Adjusted EBITDA reflects the realized (gain) loss
of such settlements.
- Acquisition costs are non-run-rate
acquisition-related transaction items, which include professional
fees, as well as non-cash hedging charges recorded in connection
with the Warrick acquisition.
- NRR is an abbreviation for
non-run-rate; NRR items are pre-tax.
- Other operating NRR items primarily
represent the impact of adjustments to environmental expenses and
net periodic post retirement service cost relating to Salaried
VEBA.
- Adjusted EBITDA = Consolidated
operating income, excluding operating NRR items, plus Depreciation
and amortization.
- Non-operating NRR items represents the
impact of non-cash net periodic benefit cost related to the
Salaried VEBA excluding service cost and debt refinancing
charges.
- Diluted shares for EPS are calculated
using the treasury stock method and were excluded from the
computations in periods of net loss per share as their inclusion
would have been anti-dilutive.
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