Shiloh Industries, Inc. (NASDAQ: SHLO), a leading global
supplier of lightweighting, noise and vibration solutions to the
automotive, commercial vehicle and other industrial markets, today
reported financial results for its fiscal 2019 third-quarter ended
July 31, 2019.
Third Quarter 2019
Highlights:
- Revenues were $263.4 million.
- Gross profit was $23.6 million with a gross margin of
9.0%.
- Net loss was $2.7 million or 11 cents per basic share.
- Adjusted income was 4 cents per basic share.
- Adjusted EBITDA was $17.3 million.
- Adjusted EBITDA margin was 6.6%.
"Overall I am pleased with Shiloh's performance throughout the
year and our ability to execute our plan," said Ramzi Hermiz,
president and chief executive officer. "We made solid progress on
several important initiatives that position Shiloh to profitably
grow and improve the capabilities of our organization over the
longer term. We continued the roll-out of major product launches,
won $475 million in new business so far this year, and strengthened
the organization through investments in technology and systems. We
continued restructuring efforts to optimize our assets and enhance
our flexing capability. Going into the fourth quarter, we are
confident in our ability to deliver full year guidance."
2019 Outlook
Shiloh is maintaining its previously announced 2019 guidance for
revenue to range from $1,000 million to $1,150 million and
tightening the range for adjusted EBITDA to range from $67 million
to $70 million from the prior range of $65 million to $70 million.
This is the second consecutive quarter that we have raised the
mid-point of guidance.
Shiloh to Host Conference Call Today at
9:00 A.M. ET
Shiloh will host a conference call on Thursday, September 5,
2019 at 9:00 A.M. Eastern Time to discuss Shiloh's third quarter
fiscal 2019 financial results. The conference call can be accessed
by dialing 1-877-407-0784, or for international callers,
1-201-689-8560. Please dial-in approximately five minutes in
advance and request the Shiloh Industries third quarter fiscal 2019
results conference call. A replay will be available after the call
and can be accessed by dialing 1-844-512-2921, or for international
callers, 1-412-317-6671. The passcode for the replay is 13694094.
The replay will be available until September 26, 2019. Interested
investors and other parties may also listen to a simultaneous
webcast of the conference call by logging onto the Investor
Relations section of Shiloh's website at www.shiloh.com.
Investor Contact:
For inquiries, please contact our Investor Relations department
at: 1-330-558-2601 or at investors@shiloh.com.
About Shiloh Industries,
Inc.
Shiloh Industries, Inc. (NASDAQ: SHLO) is a global innovative
solutions provider focusing on lightweighting technologies that
provide environmental and safety benefits to the mobility market.
Shiloh designs and manufactures products within body structure,
chassis and propulsion systems. Shiloh’s multi-component,
multi-material solutions are comprised of a variety of alloys in
aluminum, magnesium and steel grades, along with its proprietary
line of noise and vibration reducing ShilohCore® acoustic laminate
products. The strategic BlankLight®, CastLight® and StampLight®
brands combine to maximize lightweighting solutions without
compromising safety or performance. Shiloh has approximately 4,000
dedicated employees with operations, sales and technical centers
throughout Asia, Europe and North America.
Forward-Looking
Statements
Certain statements made by Shiloh in this press release
regarding our operating performance, events or developments that we
believe or expect to occur in the future, including those that
discuss strategies, goals, outlook or other non-historical matters,
or which relate to future sales, earnings expectations, cost
savings, awarded sales, volume growth, earnings or general belief
in our expectations of future operating results are
"forward-looking" statements within the meaning of the Private
Securities Litigation Reform Act of 1995. The forward-looking
statements are made on the basis of management's assumptions and
expectations. As a result, there can be no guarantee or assurance
that these assumptions and expectations will in fact occur. The
forward-looking statements are subject to risks and uncertainties
that may cause actual results to materially differ from those
contained in the statements due to a variety of factors, including
(1) our ability to accomplish our strategic objectives; (2) our
ability to obtain future sales; (3) changes in worldwide economic
and political conditions, including adverse effects from terrorism
or related hostilities; (4) costs related to legal and
administrative matters; (5) our ability to realize cost savings
expected to offset price concessions; (6) our ability to
successfully integrate acquired businesses, including businesses
located outside of the United States; (7) risks associated with
doing business internationally, including economic, political and
social instability, foreign currency exposure and the lack of
acceptance of our products; (8) inefficiencies related to
production and product launches that are greater than anticipated;
(9) changes in technology and technological risks; (10) work
stoppages and strikes at our facilities and that of our customers
or suppliers; (11) our dependence on the automotive and heavy truck
industries, which are highly cyclical; (12) the dependence of the
automotive industry on consumer spending, which is subject to the
impact of domestic and international economic conditions affecting
car and light truck production; (13) regulations and policies
regarding international trade; (14) financial and business
downturns of our customers or vendors, including any production
cutbacks or bankruptcies; (15) increases in the price of, or
limitations on the availability of aluminum, magnesium or steel,
our primary raw materials, or decreases in the price of scrap
steel; (16) the successful launch and consumer acceptance of new
vehicles for which we supply parts; (17) the impact on financial
statements of any known or unknown accounting errors or
irregularities; and the magnitude of any adjustments in restated
financial statements of our operating results; (18) the occurrence
of any event or condition that may be deemed a material adverse
effect under agreements related to our outstanding indebtedness or
a decrease in customer demand which could cause a covenant default
under agreements related to our outstanding indebtedness; (19)
pension plan funding requirements; and (20) other factors besides
those listed here could also materially affect our business. See
"Part II, Item 1A. Risk Factors" in our Annual Report on Form 10-K
for the fiscal year ended October 31, 2018 for a more complete
discussion of these risks and uncertainties. Any or all of these
risks and uncertainties could cause actual results to differ
materially from those reflected in the forward-looking statements.
These forward-looking statements reflect management's analysis only
as of the date of this Press Release. We undertake no obligation to
publicly revise these forward-looking statements to reflect events
or circumstances that arise after the date of filing this Press
Release. In addition to the disclosures contained herein, readers
should carefully review risks and uncertainties contained in other
documents we file from time to time with the SEC.
Non-GAAP Financial
Measures
This press release may include non-GAAP financial measures,
including “EBITDA,” “adjusted EBITDA ," "adjusted EBITDA margin"
and "adjusted earnings per share." We define EBITDA as net income
(loss) before interest, taxes, depreciation and amortization. We
define adjusted EBITDA as net income (loss) before interest, taxes,
depreciation, amortization, and other adjustments as described in
the reconciliations accompanying this press release. We define
adjusted EBITDA margin as adjusted EBITDA divided by net revenues
as shown in the reconciliations accompanying this press release.
Adjusted earnings per share excludes certain income and expense
items as shown in the reconciliation accompanying this press
release. We use EBITDA, adjusted EBITDA, adjusted EBITDA margin and
adjusted earnings per share as supplements to information provided
in accordance with generally accepted accounting principles
("GAAP") in evaluating our business and they are included in this
press release because they are principal factors upon which our
management assesses performance. Reconciliations of these non-GAAP
financial measures to the most directly comparable financial
measures calculated in accordance with GAAP are set forth below.
The non-GAAP measures presented in this release are not measures of
performance under GAAP. These measures should not be considered as
alternatives to the most directly comparable financial measures
calculated in accordance with GAAP. Other companies in our industry
may define these non-GAAP measures differently than we do and, as a
result, these non-GAAP measures may not be comparable to similarly
titled measures used by other companies; and certain of our
non-GAAP financial measures exclude financial information that some
may consider important in evaluating our performance. Given the
inherent uncertainty regarding special items and other expenses in
any future period, a reconciliation of forward-looking financial
measures to the most directly comparable financial measures
calculated and presented in accordance with GAAP is not feasible.
The magnitude of these items, however, may be significant.
Adjusted Earnings Per Share
Reconciliation
Three Months Ended July
31,
Nine Months Ended July
31,
2019
2018
2019
2018
Net income (loss) per common share
(GAAP)
Basic
$(0.11)
$0.47
$(0.27)
$0.86
Tax items (1)
—
(0.34)
—
(0.10)
Tax Cuts and Jobs Act, impact
—
—
—
(0.14)
Restructuring
0.12
0.06
0.37
0.16
Amortization of intangibles
0.02
0.02
0.05
0.06
Marketable securities
—
0.01
—
0.01
Legal and professional fees
0.01
—
0.08
0.01
Adjusted basic earnings (loss) per share
(non-GAAP)
$0.04
$0.22
$0.23
$0.86
(1) For the three months ended July 31, 2018, there was a $2,300
benefit related to a return to provision due to a change in
estimate and a $5,500 benefit based on adjusting the estimated
annual tax rate. For the nine months ended July 31, 2018, there was
a $2,300 benefit related to a return to provision due to a change
in estimate.
Adjusted EBITDA Reconciliation
Three Months Ended July
31,
Nine Months Ended July
31,
2019
2018
2019
2018
Net income (loss)
$(2,709)
$11,052
$(6,295)
$19,935
Depreciation and amortization
11,652
12,361
35,010
33,775
Interest expense
4,629
3,208
11,826
8,185
Benefit for income taxes
(973)
(7,014)
(2,612)
(9,854)
EBITDA (non-GAAP)
12,599
19,607
37,929
52,041
Restructuring
3,905
1,965
11,371
4,962
Legal and professional fees
195
—
2,291
367
Stock compensation
586
515
1,576
1,557
Marketable securities
—
154
—
154
Adjusted EBITDA (non-GAAP)
$17,285
$22,241
$53,167
$59,081
Adjusted EBITDA margin (non-GAAP)
6.6%
7.5%
6.7%
7.0%
SHILOH INDUSTRIES,
INC.
CONSOLIDATED BALANCE
SHEETS
(Dollar amounts in
thousands)
July 31, 2019
October 31, 2018
(Unaudited)
ASSETS:
Cash and cash equivalents
$
11,936
$
16,843
Accounts receivable, net
180,502
209,733
Related party accounts receivable
466
996
Prepaid income taxes
6,341
1,391
Inventories, net
67,615
71,412
Prepaid expenses
11,854
10,478
Other current assets
10,318
22,124
Total current assets
289,032
332,977
Property, plant and equipment, net
333,840
316,176
Goodwill
27,384
27,376
Intangible assets, net
13,489
14,939
Deferred income taxes
2,811
5,665
Other assets
7,732
12,542
Total assets
$
674,288
$
709,675
LIABILITIES AND STOCKHOLDERS’
EQUITY:
Current debt
$
350
$
1,327
Accounts payable
170,175
177,400
Other accrued expenses
45,411
63,031
Accrued income taxes
27
1,874
Total current liabilities
215,963
243,632
Long-term debt
248,393
245,351
Long-term benefit liabilities
14,579
15,553
Deferred income taxes
792
2,894
Other liabilities
3,440
2,723
Total liabilities
483,167
510,153
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 per share;
5,000,000 shares authorized; no shares issued and outstanding at
July 31, 2019 and October 31, 2018, respectively
—
—
Common stock, par value $0.01 per share;
75,000,000 and 50,000,000 shares authorized at July 31, 2019 and
October 31, 2018, respectively; 23,799,035 and 23,417,107 shares
issued and outstanding at July 31, 2019 and October 31, 2018,
respectively
238
234
Paid-in capital
115,977
114,405
Retained earnings
129,518
135,813
Accumulated other comprehensive loss,
net
(54,612
)
(50,930
)
Total stockholders’ equity
191,121
199,522
Total liabilities and stockholders’
equity
$
674,288
$
709,675
SHILOH INDUSTRIES,
INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(Amounts in thousands, except
per share data)
Three Months Ended July
31,
Nine Months Ended July
31,
2019
2018
2019
2018
(Unaudited)
(Unaudited)
(Unaudited)
(Unaudited)
Net revenues
$
263,445
$
294,883
$
795,748
$
839,889
Cost of sales
239,857
262,003
729,790
747,616
Gross profit
23,588
32,880
65,958
92,273
Selling, general & administrative
expenses
18,105
22,773
51,069
66,159
Amortization of intangible assets
518
607
1,558
1,767
Restructuring
3,905
1,965
11,371
4,962
Operating income
1,060
7,535
1,960
19,385
Interest expense
4,633
3,209
11,836
8,194
Interest income
(4
)
(1
)
(10
)
(9
)
Other (income) expense, net
113
289
(959
)
1,119
Income (loss) before income taxes
(3,682
)
4,038
(8,907
)
10,081
Benefit for income taxes
(973
)
(7,014
)
(2,612
)
(9,854
)
Net income (loss)
$
(2,709
)
$
11,052
$
(6,295
)
$
19,935
Income (loss) per share:
Basic earnings (loss) per share
$
(0.11
)
$
0.47
$
(0.27
)
$
0.86
Basic weighted average number of common
shares
23,557
23,278
23,486
23,202
Diluted earnings (loss) per share
$
(0.11
)
$
0.47
$
(0.27
)
$
0.85
Diluted weighted average number of common
shares
23,557
23,453
23,486
23,341
SHILOH INDUSTRIES,
INC.
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(Dollar amounts in
thousands)
Nine Months Ended July
31,
2019
2018
(Unaudited)
(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)
$
(6,295
)
$
19,935
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization
35,010
33,775
Amortization of deferred financing
costs
1,033
935
Restructuring
1,610
672
Deferred income taxes
232
(2,251
)
Stock-based compensation expense
1,576
1,557
(Gain) loss on sale of assets
(3,562
)
2,300
Loss on marketable securities
29
154
Changes in operating assets and
liabilities:
Accounts receivable, net
30,213
18,599
Inventories, net
3,900
(2,656
)
Prepaids and other assets
(1,564
)
(4,884
)
Payables and other liabilities
(30,965
)
(6,989
)
Prepaid and accrued income taxes
(6,863
)
(10,266
)
Net cash provided by operating
activities
24,354
50,881
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures
(48,643
)
(38,668
)
Proceeds from sale of marketable
securities
14
—
Acquisitions, net of cash required
—
(62,481
)
Derivative settlements
5,855
—
Proceeds from sale of assets
12,339
2,696
Net cash used in investing activities
(30,435
)
(98,453
)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of capital leases
(495
)
(667
)
Proceeds from long-term borrowings
223,400
218,300
Repayments of long-term borrowings
(220,000
)
(161,793
)
Payment of deferred financing costs
(1,948
)
(105
)
Proceeds from exercise of stock
options
—
41
Net cash provided by financing
activities
957
55,776
Effect of foreign currency exchange rate
fluctuations on cash
217
336
Net increase (decrease) in cash and cash
equivalents
(4,907
)
8,540
Cash and cash equivalents at beginning of
period
16,843
8,736
Cash and cash equivalents at end of
period
$
11,936
$
17,276
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190905005311/en/
Kevin Doherty investors@shiloh.com 1-330-558-2601
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