- EPS of $0.04 for Q3 2023 and $0.10 for 2023 YTD.
- Operating income of $1.7 million for Q3 2023 and $7.0
million 2023 YTD, up significantly from prior year.
- Air and Liquid Processing segment sales increased 18% for Q3
2023 and 29% 2023 YTD compared to prior year periods with record
sales 2023 YTD and another record backlog at Q3 2023.
- U.S. forged business equipment modernization project on
track for completion in Q4 2023.
Ampco-Pittsburgh Corporation (NYSE: AP) reported net sales of
$102.2 million and $314.2 million, respectively, for the three and
nine months ended September 30, 2023, compared to $99.6 million and
$296.7 million for the three and nine months ended September 30,
2022, respectively. The increase is attributable to higher
shipments for the Air and Liquid Processing segment.
Commenting on the quarter, Ampco-Pittsburgh’s CEO, Brett
McBrayer, said, “Despite scheduled downtime taken in Q3 for plant
maintenance to align with customer downtime in the Forged and Cast
Engineered Products segment, the Corporation produced another
profitable quarter. Although forged engineered products sales into
the steel distribution and oil and gas markets remained sluggish,
and cost absorption was lower given the plant downtime taken,
stronger roll pricing coupled with a decline in commodity prices
and growth in the Air and Liquid segment delivered the
year-over-year improvement for the quarter, expanding our operating
income improvement year-to-date.”
Income from operations for the three and nine months ended
September 30, 2023, was $1.7 million and $7.0 million,
respectively, compared to $0.2 million and $1.8 million for the
three and nine months ended September 30, 2022, respectively. The
improvement was driven primarily by higher pricing, net of lower
surcharges, in the Forged and Cast Engineered Products segment and
a higher volume of sales in the Air and Liquid Processing
segment.
In addition, operating income for the nine months ended
September 30, 2023, includes a credit of approximately $1.9 million
for the reimbursement of past energy costs at one of the
Corporation's foreign operations by its local government (the
“Foreign Energy Credit”). Included in operating income for the nine
months ended September 30, 2022, is a charge of approximately $0.6
million for excess COVID-19 subsidies received in 2020 and returned
in 2022 (the “Refund of Excess COVID-19 Subsidies”), and a benefit
of approximately $1.4 million resulting from a change in how
certain employees earn certain benefits (the “Change in Employee
Benefit Policy”).
Investment-related income for the three and nine months ended
September 30, 2023 and 2022 was primarily comprised of dividends
declared by one of the Corporation’s Chinese joint ventures
totaling $0.1 million and $0.5 million, respectively. Interest
expense for the three and nine months ended September 30, 2023,
increased in comparison to the same periods of the prior year due
to rising interest rates and higher borrowings, in part, due to
ongoing expenditures associated with the capital investment
modernization program for the domestic forged business. Other – net
for the three and nine months ended September 30, 2023, decreased
in comparison to the prior year periods primarily due to lower
foreign exchange transaction gains in the current year periods.
Net income was $0.8 million, or $0.04 per common share, and $1.9
million, or $0.10 per common share, for the three and nine months
ended September 30, 2023, respectively. This compares to net income
of $1.1 million, or $0.06 per common share, and $3.9 million, or
$0.20 per common share, for the three and nine months ended
September 30, 2022, respectively. Net income and earnings per
common share for the three months ended September 30, 2023, include
an after-tax benefit of $0.2 million or $0.01 per share for a cash
recovery received from an insolvent asbestos-related insurance
carrier (the “Asbestos-Related Credit”). Net income and common
earnings per share for the nine months ended September 30, 2023,
include after-tax benefits of $2.1 million or $0.11 per share
associated with the Asbestos-Related Credit and the Foreign Energy
Credit.
Segment Results
Forged and Cast Engineered
Products
Sales for the Forged and Cast Engineered Products segment for
the three and nine months ended September 30, 2023, declined
slightly when compared to the same periods in the prior year
primarily due to lower volume of FEP shipments as a result of
reduced demand from the steel distribution and oil and gas markets.
Stronger forged roll shipments more than offset weaker cast roll
shipments.
Operating results for the three and nine months ended September
30, 2023, improved compared to the same periods in the prior year
primarily due to improved pricing net of surcharges and, for the
nine-months ended September 30, 2023, the benefit from the Foreign
Energy Credit. These changes were offset in part by lower cost
absorption resulting from the temporary and periodic idling of
certain equipment to align production with customer demand, higher
selling and administrative costs and a lower net volume of
shipments.
Air and Liquid Processing
Sales for the Air and Liquid Processing segment for the three
and nine months ended September 30, 2023, improved 18% and 29%,
respectively, compared to the same periods in the prior year due to
a higher volume of shipments for each division. Operating results
improved when compared to the same periods in the prior year due
primarily to improved pricing and a higher volume of sales, net of
unfavorable product mix, and the Asbestos-Related Credit in the
current year periods. These impacts were partly offset by higher
selling and administrative costs, primarily due to higher sales
commissions and costs associated with expansion of the segment’s
sales distribution network, and the recognition of a $0.7 million
benefit for the nine months ended September 30, 2022, resulting
from the Change in Employee Benefit Policy.
Teleconference Access
Ampco-Pittsburgh Corporation will hold a conference call on
Tuesday, November 14, 2023, at 10:30 a.m. Eastern Time (ET) to
discuss its financial results for the third quarter ended September
30, 2023. The Corporation encourages participants to pre-register
at any time, including up to and after the call start time via this
link: https://dpregister.com/sreg/10183827/fade2c397e. Those
without internet access or unable to pre-register should dial in at
least five minutes before the start time using:
- Domestic: 1-844-308-3408
- International: 1-412-317-5408
For those unable to listen to the live broadcast, a replay will
be available one hour after the event concludes on the
Corporation’s website under the Investors menu at
www.ampcopgh.com.
About Ampco-Pittsburgh Corporation
Ampco-Pittsburgh Corporation manufactures and sells highly
engineered, high-performance specialty metal products and
customized equipment utilized by industry throughout the world.
Through its operating subsidiary, Union Electric Steel Corporation,
it is a leading producer of forged and cast rolls for the global
steel and aluminum industries. It also manufactures open-die forged
products that are sold principally to customers in the steel
distribution market, oil and gas industry, and the aluminum and
plastic extrusion industries. The Corporation is also a producer of
air and liquid processing equipment, primarily custom-engineered
finned tube heat exchange coils, large custom air handling systems
and centrifugal pumps. It operates manufacturing facilities in the
United States, England, Sweden, and Slovenia and participates in
three operating joint ventures located in China. It has sales
offices in North America, Asia, Europe, and the Middle East.
Corporate headquarters is located in Carnegie, Pennsylvania.
Forward-Looking
Statements
The Private Securities Litigation Reform Act of 1995 (the “Act”)
provides a safe harbor for forward-looking statements made by us or
on behalf of the Corporation. This press release may include, but
is not limited to, statements about operating performance, trends
and events that the Corporation expects or anticipates will occur
in the future, statements about sales and production levels,
restructurings, the impact from global pandemics, profitability and
anticipated expenses, inflation, the global supply chain, future
proceeds from the exercise of outstanding warrants, and cash
outflows. All statements in this document other than statements of
historical fact are statements that are, or could be, deemed
“forward-looking statements” within the meaning of the Act and
words such as “may,” “will,” “intend,” “believe,” “expect,”
“anticipate,” “estimate,” “project,” “forecast” and other terms of
similar meaning that indicate future events and trends are also
generally intended to identify forward-looking statements.
Forward-looking statements speak only as of the date on which such
statements are made, are not guarantees of future performance or
expectations, and involve risks and uncertainties. For the
Corporation, these risks and uncertainties include, but are not
limited to: economic downturns, cyclical demand for our products
and insufficient demand for our products; excess global capacity in
the steel industry; fluctuations in the value of the U.S. dollar
relative to other currencies; increases in commodity prices or
insufficient hedging against increases in commodity prices,
reductions in electricity and natural gas supply or shortages of
key production materials for us or our customers; limitations in
availability of capital to fund our strategic plan; inability to
maintain adequate liquidity to meet our operating cash flow
requirements, repay maturing debt and meet other financial
obligations; inability to obtain necessary capital or financing on
satisfactory terms to acquire capital expenditures that may be
necessary to support our growth strategy; inoperability of certain
equipment on which we rely and/or our inability to execute our
capital expenditure plan; impairment of our long-lived assets as a
result of any of these, or a combination of these, risk and
uncertainties; liability of our subsidiaries for claims alleging
personal injury from exposure to asbestos-containing components
historically used in certain products of our subsidiaries; changes
in the existing regulatory environment; inability to successfully
restructure our operations and/or invest in operations that will
yield the best long term value to our shareholders; consequences of
global pandemics and international conflicts; work stoppage or
another industrial action on the part of any of our unions;
inability to satisfy the continued listing requirements of the New
York Stock Exchange or the NYSE American Exchange; potential
attacks on information technology infrastructure and other
cyber-based business disruptions; failure to maintain an effective
system of internal control; and those discussed more fully
elsewhere in Item 1A, Risk Factors outlined in Part I of the
Corporation’s latest Annual Report on Form 10-K and Part II of the
latest Quarterly Report on Form 10-Q. The Corporation cannot
guarantee any future results, levels of activity, performance, or
achievements. In addition, there may be events in the future that
we are not able to predict accurately or control which may cause
actual results to differ materially from expectations expressed or
implied by forward-looking statements. Except as required by
applicable law, we assume no obligation, and disclaim any
obligation, to update forward-looking statements whether as a
result of new information, events or otherwise.
AMPCO-PITTSBURGH
CORPORATION
FINANCIAL SUMMARY
(in thousands, except per
share amounts)
Three
Months Ended
September
30,
Nine Months
Ended
September
30,
2023
2022
2023
2022
Net sales
$
102,218
$
99,647
$
314,232
$
296,655
Cost of products sold (excl. depreciation
and amortization)
84,490
84,101
256,333
249,700
Selling and administrative
11,821
11,089
38,101
31,941
Depreciation and amortization
4,382
4,206
13,110
13,133
Credit for asbestos litigation
(191)
-
(191)
-
(Gain) loss on disposal of assets
(6)
48
(124)
47
Total operating expenses
100,496
99,444
307,229
294,821
Income from operations
1,722
203
7,003
1,834
Other (expense) income:
Investment-related income
98
507
114
513
Interest expense
(2,468)
(1,486)
(6,784)
(3,684)
Other – net
1,959
3,174
3,424
7,019
Total other (expense) income – net
(411)
2,195
(3,246)
3,848
Income before income taxes
1,311
2,398
3,757
5,682
Income tax provision
(76)
(987)
(541)
(1,432)
Net income
1,235
1,411
3,216
4,250
Less: Net income attributable to
noncontrolling interest
426
288
1,308
371
Net income attributable to
Ampco-Pittsburgh
$
809
$
1,123
$
1,908
$
3,879
Net income per share attributable to
Ampco-Pittsburgh common shareholders:
Basic
$
0.04
$
0.06
$
0.10
$
0.20
Diluted
$
0.04
$
0.06
$
0.10
$
0.20
Weighted-average number of common
shares
outstanding:
Basic
19,729
19,396
19,580
19,291
Diluted
19,729
19,522
19,633
19,473
AMPCO-PITTSBURGH
CORPORATION
SEGMENT INFORMATION
(in thousands)
Three
Months Ended
September
30,
Nine Months
Ended
September
30,
2023
2022
2023
2022
Net Sales:
Forged and Cast Engineered Products
$
73,625
$
75,511
$
228,004
$
229,848
Air and Liquid Processing
28,593
24,136
86,228
66,807
Consolidated
$
102,218
$
99,647
$
314,232
$
296,655
Income from Operations:
Forged and Cast Engineered Products
$
1,448
$
215
$
7,576
$
2,092
Air and Liquid Processing
3,456
2,917
9,386
8,177
Corporate costs
(3,182)
(2,929)
(9,959)
(8,435)
Consolidated
$
1,722
$
203
$
7,003
$
1,834
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231113583534/en/
Michael G. McAuley Senior Vice President, Chief Financial
Officer and Treasurer (412) 429-2472 mmcauley@ampcopgh.com
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