NORTHVILLE, Mich., Feb. 15,
2024 /PRNewswire/ -- Cooper-Standard Holdings
Inc. (NYSE: CPS) today reported results for the fourth quarter and
full year 2023.
Fourth Quarter 2023 Summary
- Sales totaled $673.6 million,
an increase of 3.7% compared to fourth quarter 2022
- Gross profit totaled $64.7
million, an increase of 19.1% compared to fourth quarter
2022
- Net loss of $55.2 million, or
$(3.16) per diluted share, reflected
an improvement of $32.9 million vs.
the fourth quarter 2022
- Adjusted EBITDA totaled $27.6
million, or 4.1% of sales
- Net cash provided by operating activities of $79.7 million improved by $105.5 million vs. the fourth quarter of
2022
Full Year 2023 Summary
- Sales totaled $2.82 billion,
an increase of 11.5% compared to 2022
- Gross profit totaled $290.8
million, an increase of 124.0% compared to 2022
- Net loss of $202.0 million, or
$(11.64) per diluted share, reflected
an improvement of $13.4 million vs.
2022
- Adjusted EBITDA of $167.1
million, or 5.9% of sales, increased by $129.2 million vs. 2022
- Net cash provided by operating activities of $117.3 million improved by $153.4 million vs. 2022
"We continued to make strong improvements as a company in 2023.
We want to thank our dedicated employees for their hard work and
commitment to achieving improved financial results and our
customers for their continued trust and support," said Jeffrey Edwards, chairman and CEO, Cooper
Standard. "We expect to build on the successes of 2023 to drive
increasing value for all our stakeholders in 2024."
Consolidated Results
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
(dollar amounts in
millions except per share amounts)
|
Sales
|
$
673.6
|
|
$
649.3
|
|
$
2,815.9
|
|
$
2,525.4
|
Net loss
|
$
(55.2)
|
|
$
(88.1)
|
|
$
(202.0)
|
|
$
(215.4)
|
Adjusted net
loss
|
$
(31.1)
|
|
$
(31.9)
|
|
$
(82.3)
|
|
$
(171.5)
|
Loss per diluted
share
|
$
(3.16)
|
|
$
(5.12)
|
|
$
(11.64)
|
|
$
(12.53)
|
Adjusted loss per
diluted share
|
$
(1.79)
|
|
$
(1.85)
|
|
$
(4.74)
|
|
$
(9.98)
|
Adjusted
EBITDA
|
$
27.6
|
|
$
27.6
|
|
$
167.1
|
|
$
37.9
|
Net cash provided by
(used in) operating activities
|
$
79.7
|
|
$
(25.8)
|
|
$
117.3
|
|
$
(36.2)
|
Free cash
flow
|
$
62.1
|
|
$
(38.4)
|
|
$
36.5
|
|
$
(107.3)
|
The year-over-year increase in fourth quarter sales was
primarily attributable to sustainable price adjustments, inflation
recoveries, favorable volume and mix, and favorable foreign
exchange, partially offset by lost production volume related to
union work stoppages and the deconsolidation or divestiture of
non-core businesses.
The year-over-year improvement in fourth quarter net loss was
primarily due to savings generated from lean manufacturing and
purchasing initiatives, lower tax expense, favorable price
adjustments, and lower raw material costs. These positive factors
were partially offset by higher interest expense, pension
settlement charges, increased accruals for annual incentive
compensation, lost production volume related to union work
stoppages, continuing inflationary pressure, including higher labor
and energy costs.
Adjusted EBITDA for the fourth quarter of 2023 was in line with
adjusted EBITDA in the fourth quarter of 2022. The fourth quarter
2023 results reflect significant savings generated from lean
manufacturing and purchasing initiatives, favorable price
adjustments, and lower raw material costs. These positive factors
were offset, however, by increased accruals for annual incentive
compensation, lost production volume related to union work
stoppages, and continuing inflationary pressure, including higher
labor and energy costs.
For the full year 2023, sales increased primarily due to
improved volume and mix including sustainable price adjustments,
partially offset by unfavorable foreign exchange and the
deconsolidation or divestiture of non-core businesses. The
year-over-year improvement in full year net loss was primarily
driven by favorable volume and mix, including sustainable price
adjustments, improved manufacturing efficiency, lower material
costs, reduced asset impairment charges, and lower income tax
expense. These positive factors were partially offset by losses on
refinancing and extinguishment of debt, higher wages, general
inflation, higher interest expense, pension settlement charges, and
higher incentive compensation. The year-over-year improvement in
full year adjusted EBITDA was driven primarily by favorable volume
and mix, including sustainable price adjustments, improved
manufacturing efficiency, and lower material costs. These positive
factors were partially offset by higher wages, general inflation,
unfavorable foreign exchange and higher incentive compensation.
Cash Flow and Liquidity
Cash provided by operating activities in the fourth quarter of
2023 was $79.7 million, an increase
of $105.5 million compared to the
fourth quarter of 2022. Free cash flow (defined as cash provided by
operating activities less CAPEX) in the fourth quarter of 2023 was
$62.1 million, an increase of
$100.6 million compared to the fourth
quarter of 2022. The increase was driven primarily by improved
operating earnings, inventory conversion, and collections on
enhanced commercial agreements and tooling receivables.
For the full year 2023, cash provided by operating activities
was $117.3 million and free cash flow
was $36.5 million. This compared to
cash used in operating activities of $36.2
million and free cash outflow of $107.3 million in 2022.
As of December 31, 2023, Cooper
Standard had cash and cash equivalents totaling $154.8 million. Total liquidity, including
availability on the Company's undrawn revolving credit facility,
was $317.2 million at year end. Based
on current expectations for light vehicle production and customer
demand for our products, the Company believes it has sufficient
financial resources to support ongoing operations and the execution
of planned strategic initiatives for the foreseeable future. These
financial resources include current cash on hand, continuing access
to flexible credit facilities, and expected future positive cash
generation.
Adjusted net loss, adjusted EBITDA, adjusted loss per diluted
share and free cash flow are non-GAAP measures. Reconciliations to
the most directly comparable financial measures, calculated and
presented in accordance with accounting principles generally
accepted in the United States
("U.S. GAAP"), are provided in the attached supplemental
schedules.
Automotive New Business Awards
The Company continues to leverage its world-class engineering
and manufacturing capabilities, its innovation programs and its
reputation for quality and service to win new business awards with
its customers and capitalize on positive trends associated with
electric vehicles. During the fourth quarter of 2023, the Company
received total net new business awards representing $86.3 million in incremental anticipated future
annualized sales. The total included $25.7
million in net new business awards on electric vehicle
platforms. For the full year 2023, net new business awards totaled
$175.3 million, including
$114.9 million in net new business
awards on electric vehicle platforms.
Segment Results of Operations
Sales
|
Three Months Ended
December 31,
|
|
|
Variance Due
To:
|
|
2023
|
|
2022
|
|
Change
|
|
|
Volume /
Mix*
|
|
Foreign
Exchange
|
|
Divestitures
|
|
(dollar amounts in
thousands)
|
Sales to external
customers
|
|
|
|
|
|
|
|
|
|
|
|
|
North
America
|
$ 341,257
|
|
$ 336,507
|
|
$
4,750
|
|
|
$
3,005
|
|
$
1,745
|
|
$
—
|
Europe
|
160,954
|
|
132,301
|
|
28,653
|
|
|
20,107
|
|
8,546
|
|
—
|
Asia
Pacific
|
125,817
|
|
124,101
|
|
1,716
|
|
|
4,289
|
|
(940)
|
|
(1,633)
|
South
America
|
28,926
|
|
25,567
|
|
3,359
|
|
|
1,657
|
|
1,702
|
|
—
|
Total
Automotive
|
656,954
|
|
618,476
|
|
38,478
|
|
|
29,058
|
|
11,053
|
|
(1,633)
|
Corporate,
eliminations and other
|
16,689
|
|
30,861
|
|
(14,172)
|
|
|
(4,549)
|
|
—
|
|
(9,623)
|
Consolidated
sales
|
$ 673,643
|
|
$ 649,337
|
|
$
24,306
|
|
|
$
24,509
|
|
$
11,053
|
|
$ (11,256)
|
|
* Net
of customer price adjustments, including recoveries.
|
- Volume and mix, net of customer price adjustments including
recoveries, was mainly driven by vehicle production volume
increases due to the stabilization of the supply environment. It
was partially offset by the negative impact of work stoppages
initiated by certain labor unions in North America in 2023.
- The net impact of foreign currency exchange was primarily
related to the Euro.
Adjusted EBITDA
|
Three Months Ended
December 31,
|
|
|
Variance Due
To:
|
|
2023
|
|
2022
|
|
Change
|
|
|
Volume/
Mix*
|
|
Foreign
Exchange
|
|
Cost
(Increases)/
Decreases**
|
|
(dollar amounts in
thousands)
|
Segment adjusted
EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
North
America
|
$
15,642
|
|
$
18,481
|
|
$
(2,839)
|
|
|
$
8,181
|
|
$
1,728
|
|
$ (12,748)
|
Europe
|
11,336
|
|
3,741
|
|
7,595
|
|
|
(346)
|
|
1,357
|
|
6,584
|
Asia
Pacific
|
8,775
|
|
2,574
|
|
6,201
|
|
|
823
|
|
239
|
|
5,139
|
South
America
|
2,750
|
|
1,038
|
|
1,712
|
|
|
(79)
|
|
1,101
|
|
690
|
Total
Automotive
|
38,503
|
|
25,834
|
|
12,669
|
|
|
8,579
|
|
4,425
|
|
(335)
|
Corporate,
eliminations and other
|
(10,926)
|
|
1,758
|
|
(12,684)
|
|
|
(328)
|
|
559
|
|
(12,915)
|
Consolidated
adjusted EBITDA
|
$
27,577
|
|
$
27,592
|
|
$
(15)
|
|
|
$
8,251
|
|
$
4,984
|
|
$ (13,250)
|
|
* Net of
customer price adjustments, including recoveries.
|
** Net
of divestitures.
|
- Volume and mix, net of customer price adjustments including
recoveries, was driven by vehicle production volume increases due
to the stabilization of the supply environment, partially offset by
the impact of work stoppages initiated by certain labor unions in
North America in 2023.
- The net impact of foreign currency exchange was primarily
related to the Brazilian Real, Canadian Dollar and Euro.
- The Cost (Increases) / Decreases category above includes:
- Commodity cost and inflationary economics;
- Manufacturing and purchasing savings through lean initiatives;
and
- Increased compensation-related expenses.
Outlook
Industry projections for 2024 global light vehicle production
anticipate volumes essentially in line with 2023 levels. The
Company expects to continue leveraging enhanced commercial
agreements and operating efficiencies to offset continued
inflationary pressures. As a result, Company management expects to
deliver improved financial results in 2024 vs. 2023. Initial full
year 2024 guidance ranges for key financial measures are as
follows:
|
2023 Actual
Results
|
Initial 2024
Guidance1
|
Sales
|
$2.82 billion
|
$2.8 - $2.9
billion
|
Adjusted
EBITDA2
|
$167.1 million
|
$180 - $210
million
|
Capital
Expenditures
|
$80.7 million
|
$75 - $85
million
|
Cash
Restructuring
|
$13.9 million
|
$15 - $20
million
|
Net Cash
Interest
|
$68.1
million
|
$70 - $75
million
|
Net Cash
Taxes
|
$10.3 million
|
$20 - $25
million
|
Key Light Vehicle
Productions
Assumptions (Units)
|
|
|
North
America
|
15.6 million
|
15.8 million
|
Europe
|
17.8 million
|
17.4 million
|
Greater
China
|
28.9 million
|
28.9 million
|
South
America
|
2.9 million
|
3.0 million
|
|
1 Guidance
is representative of management's estimates and expectations as of
the date it is published. Current guidance as presented in this
press release considers January 2024 S&P Global (IHS
Markit) production forecasts for relevant light vehicle platforms
and models, customers' planned production schedules and other
internal assumptions.
|
2 Adjusted EBITDA is a non-GAAP
financial measure. The Company has not provided a reconciliation of
projected adjusted EBITDA to projected net income (loss) because
full-year net income (loss) will include special items that have
not yet occurred and are difficult to predict with reasonable
certainty prior to year-end. Due to this uncertainty, the Company
cannot reconcile projected adjusted EBITDA to U.S. GAAP net income
(loss) without unreasonable effort.
|
Conference Call Details
Cooper Standard management will host a conference call and
webcast on February 16, 2024 at 9 a.m.
ET to discuss its fourth quarter 2023 results, provide a
general business update and respond to investor questions.
Investors and other interested parties may listen to the call by
accessing the online, real-time webcast
at https://ir.cooperstandard.com/events.
To participate by phone, callers in the United States and Canada can dial toll-free at 800-836-8184
(international callers dial 646-357-8785) and ask to be connected
to the Cooper Standard conference call. Representatives of the
investment community will have the opportunity to ask questions
during Q&A. Participants should dial-in at least five minutes
prior to the start of the call.
A replay of the webcast will be available on the investors'
portion of the Cooper Standard website
(https://ir.cooperstandard.com) shortly after the live event.
About Cooper Standard
Cooper Standard, headquartered in Northville, Mich., with locations in 21
countries, is a leading global supplier of sealing and fluid
handling systems and components. Utilizing our materials science
and manufacturing expertise, we create innovative and sustainable
engineered solutions for diverse transportation and industrial
markets. Cooper Standard's approximately 23,000 employees are at
the heart of our success, continuously improving our business and
surrounding communities. Learn more at www.cooperstandard.com or
follow us on LinkedIn, X, Facebook, Instagram or YouTube.
Forward Looking Statements
This press release includes "forward-looking statements" within
the meaning of U.S. federal securities laws, and we intend that
such forward-looking statements be subject to the safe harbor
created thereby. Our use of words "estimate," "expect,"
"anticipate," "project," "plan," "intend," "believe," "outlook,"
"guidance," "forecast," or future or conditional verbs, such as
"will," "should," "could," "would," or "may," and variations of
such words or similar expressions are intended to identify
forward-looking statements. All forward-looking statements are
based upon our current expectations and various assumptions. Our
expectations, beliefs, and projections are expressed in good faith
and we believe there is a reasonable basis for them. However, we
cannot assure you that these expectations, beliefs and projections
will be achieved. Forward-looking statements are not guarantees of
future performance and are subject to significant risks and
uncertainties that may cause actual results or achievements to be
materially different from the future results or achievements
expressed or implied by the forward-looking statements. Among other
items, such factors may include: volatility or decline of the
Company's stock price, or absence of stock price appreciation;
impacts and disruptions related to the wars in Ukraine and the Middle East; our ability to achieve commercial
recoveries and to offset the adverse impact of higher commodity and
other costs through pricing and other negotiations with our
customers; work stoppages or other labor disruptions with our
employees or our customers' employees; prolonged or material
contractions in automotive sales and production volumes; our
inability to realize sales represented by awarded business;
escalating pricing pressures; loss of large customers or
significant platforms; our ability to successfully compete in the
automotive parts industry; availability and increasing volatility
in costs of manufactured components and raw materials; disruption
in our supply base; competitive threats and commercial risks
associated with our diversification strategy; possible variability
of our working capital requirements; risks associated with our
international operations, including changes in laws, regulations,
and policies governing the terms of foreign trade such as increased
trade restrictions and tariffs; foreign currency exchange rate
fluctuations; our ability to control the operations of our joint
ventures for our sole benefit; our substantial amount of
indebtedness and variable rates of interest; our ability to obtain
adequate financing sources in the future; operating and financial
restrictions imposed on us under our debt instruments; the
underfunding of our pension plans; significant changes in discount
rates and the actual return on pension assets; effectiveness of
continuous improvement programs and other cost savings plans;
significant costs related to manufacturing facility closings or
consolidation; our ability to execute new program launches; our
ability to meet customers' needs for new and improved products; the
possibility that our acquisitions and divestitures may not be
successful; product liability, warranty and recall claims brought
against us; laws and regulations, including environmental, health
and safety laws and regulations; legal and regulatory proceedings,
claims or investigations against us; the potential impact of any
future public health events on our financial condition and results
of operations; the ability of our intellectual property to
withstand legal challenges; cyber-attacks, data privacy concerns,
other disruptions in, or the inability to implement upgrades to,
our information technology systems; the possible volatility of our
annual effective tax rate; the possibility of a failure to maintain
effective controls and procedures; the possibility of future
impairment charges to our goodwill and long-lived assets; our
ability to identify, attract, develop and retain a skilled, engaged
and diverse workforce; our ability to procure insurance at
reasonable rates; and our dependence on our subsidiaries for cash
to satisfy our obligations; and other risks and uncertainties,
including those detailed from time to time in the Company's
periodic reports filed with the Securities and Exchange
Commission.
You should not place undue reliance on these forward-looking
statements. Our forward-looking statements speak only as of the
date of this press release and we undertake no obligation to
publicly update or otherwise revise any forward-looking statement,
whether as a result of new information, future events or otherwise,
except where we are expressly required to do so by law.
This press release also contains estimates and other information
that is based on industry publications, surveys and forecasts. This
information involves a number of assumptions and limitations, and
we have not independently verified the accuracy or completeness of
the information.
Contact for
Analysts:
|
Contact for
Media:
|
Roger
Hendriksen
|
Chris
Andrews
|
Cooper
Standard
|
Cooper
Standard
|
(248)
596-6465
|
(248)
596-6217
|
roger.hendriksen@cooperstandard.com
|
candrews@cooperstandard.com
|
Financial statements and related notes follow:
COOPER-STANDARD
HOLDINGS INC.
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(Dollar amounts in
thousands except share and per share amounts)
|
|
|
|
|
|
|
|
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
(Unaudited)
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
Sales
|
$
673,643
|
|
$
649,337
|
|
$ 2,815,879
|
|
$ 2,525,391
|
Cost of products
sold
|
608,943
|
|
595,023
|
|
2,525,103
|
|
2,395,600
|
Gross
profit
|
64,700
|
|
54,314
|
|
290,776
|
|
129,791
|
Selling,
administration & engineering expenses
|
59,213
|
|
50,422
|
|
215,741
|
|
199,455
|
Gain on sale of
businesses, net
|
(920)
|
|
—
|
|
(586)
|
|
—
|
Gain on sale of fixed
assets, net
|
—
|
|
—
|
|
—
|
|
(33,391)
|
Amortization of
intangibles
|
1,663
|
|
1,539
|
|
6,804
|
|
6,715
|
Restructuring
charges
|
5,094
|
|
5,290
|
|
18,018
|
|
18,304
|
Impairment
charges
|
4,114
|
|
42,873
|
|
4,768
|
|
43,710
|
Operating (loss)
profit
|
(4,464)
|
|
(45,810)
|
|
46,031
|
|
(105,002)
|
Interest expense, net
of interest income
|
(32,020)
|
|
(21,136)
|
|
(130,077)
|
|
(78,514)
|
Equity in earnings
(losses) of affiliates
|
2,141
|
|
(624)
|
|
3,281
|
|
(8,817)
|
Loss on refinancing and
extinguishment of debt
|
—
|
|
—
|
|
(81,885)
|
|
—
|
Pension settlement and
curtailment charges
|
(16,035)
|
|
(2,682)
|
|
(16,035)
|
|
(2,682)
|
Other expense,
net
|
(5,317)
|
|
(2,911)
|
|
(15,698)
|
|
(5,485)
|
Loss before income
taxes
|
(55,695)
|
|
(73,163)
|
|
(194,383)
|
|
(200,500)
|
Income tax (benefit)
expense
|
(528)
|
|
15,467
|
|
8,933
|
|
17,291
|
Net loss
|
(55,167)
|
|
(88,630)
|
|
(203,316)
|
|
(217,791)
|
Net loss attributable
to noncontrolling interests
|
15
|
|
539
|
|
1,331
|
|
2,407
|
Net loss attributable
to Cooper-Standard Holdings Inc.
|
$
(55,152)
|
|
$
(88,091)
|
|
$
(201,985)
|
|
$
(215,384)
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
17,427,183
|
|
17,218,921
|
|
17,355,392
|
|
17,190,958
|
Diluted
|
17,427,183
|
|
17,218,921
|
|
17,355,392
|
|
17,190,958
|
|
|
|
|
|
|
|
|
Loss per
share:
|
|
|
|
|
|
|
|
Basic
|
$
(3.16)
|
|
$
(5.12)
|
|
$
(11.64)
|
|
$
(12.53)
|
Diluted
|
$
(3.16)
|
|
$
(5.12)
|
|
$
(11.64)
|
|
$
(12.53)
|
COOPER-STANDARD
HOLDINGS INC.
|
CONSOLIDATED BALANCE
SHEETS
|
(Dollar amounts in
thousands except share amounts)
|
|
|
|
|
|
December
31,
|
|
2023
|
|
2022
|
|
(Unaudited)
|
|
|
Assets
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
154,801
|
|
$
186,875
|
Accounts receivable,
net
|
380,562
|
|
358,700
|
Tooling receivable,
net
|
80,225
|
|
95,965
|
Inventories
|
146,846
|
|
157,756
|
Prepaid
expenses
|
28,328
|
|
31,170
|
Income tax receivable
and refundable credits
|
11,225
|
|
13,668
|
Value added tax
receivable
|
69,684
|
|
44,402
|
Other current
assets
|
28,915
|
|
57,113
|
Total current
assets
|
900,586
|
|
945,649
|
Property, plant and
equipment, net
|
608,431
|
|
642,860
|
Operating lease
right-of-use assets, net
|
91,126
|
|
94,571
|
Goodwill
|
140,814
|
|
142,023
|
Intangible assets,
net
|
40,568
|
|
47,641
|
Deferred tax
assets
|
23,792
|
|
19,852
|
Other assets
|
66,982
|
|
70,933
|
Total
assets
|
$
1,872,299
|
|
$
1,963,529
|
|
|
|
|
Liabilities and
Equity
|
|
|
|
Current
liabilities:
|
|
|
|
Debt payable within
one year
|
$
50,712
|
|
$
54,130
|
Accounts
payable
|
334,578
|
|
338,210
|
Payroll
liabilities
|
132,422
|
|
99,029
|
Accrued
liabilities
|
116,954
|
|
119,463
|
Current operating
lease liabilities
|
18,577
|
|
20,786
|
Total current
liabilities
|
653,243
|
|
631,618
|
Long-term
debt
|
1,044,736
|
|
982,054
|
Pension
benefits
|
100,578
|
|
98,481
|
Postretirement benefits
other than pensions
|
28,940
|
|
31,014
|
Long-term operating
lease liabilities
|
76,482
|
|
77,617
|
Deferred tax
liabilities
|
5,208
|
|
7,052
|
Other
liabilities
|
52,845
|
|
34,501
|
Total
liabilities
|
1,962,032
|
|
1,862,337
|
Preferred stock, $0.001
par value, 10,000,000 shares authorized; no shares
issued and outstanding
|
—
|
|
—
|
Equity:
|
|
|
|
Common stock, $0.001
par value, 190,000,000 shares authorized;
19,263,288 shares issued and 17,197,479 outstanding as of December
31,
2023, and 19,173,838 shares issued and 17,108,029 outstanding as
of
December 31, 2022
|
17
|
|
17
|
Additional paid-in
capital
|
512,164
|
|
507,498
|
Retained
deficit
|
(391,816)
|
|
(189,831)
|
Accumulated other
comprehensive loss
|
(201,665)
|
|
(209,971)
|
Total Cooper-Standard
Holdings Inc. equity
|
(81,300)
|
|
107,713
|
Noncontrolling
interests
|
(8,433)
|
|
(6,521)
|
Total
equity
|
(89,733)
|
|
101,192
|
Total liabilities and
equity
|
$
1,872,299
|
|
$
1,963,529
|
COOPER-STANDARD
HOLDINGS INC.
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(Dollar amounts in
thousands)
|
|
|
|
|
|
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2021
|
|
(Unaudited)
|
|
|
|
|
Operating
activities:
|
|
|
|
|
|
Net loss
|
$
(203,316)
|
|
$ (217,791)
|
|
$ (328,844)
|
Adjustments to
reconcile net loss to net cash provided by (used in) operating
activities:
|
|
|
|
|
|
Depreciation
|
103,127
|
|
115,761
|
|
131,661
|
Amortization of
intangibles
|
6,804
|
|
6,715
|
|
7,347
|
Gain on sale of
businesses, net
|
(586)
|
|
—
|
|
(696)
|
Gain on sale of fixed
assets, net
|
—
|
|
(33,391)
|
|
—
|
Impairment
charges
|
4,768
|
|
43,710
|
|
25,609
|
Pension settlement and
curtailment charges
|
16,035
|
|
2,682
|
|
1,279
|
Share-based
compensation expense
|
7,718
|
|
3,259
|
|
5,574
|
Equity in (earnings)
losses of affiliates, net of dividends related to
earnings
|
(982)
|
|
12,450
|
|
4,872
|
Loss on refinancing
and extinguishment of debt
|
81,885
|
|
—
|
|
—
|
Payment-in-kind
interest
|
58,808
|
|
—
|
|
—
|
Deferred income
taxes
|
(5,813)
|
|
5,653
|
|
35,756
|
Other
|
4,838
|
|
(10,887)
|
|
3,222
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
Accounts and tooling
receivable
|
(12,333)
|
|
(65,712)
|
|
52,677
|
Inventories
|
6,412
|
|
(2,221)
|
|
(18,527)
|
Prepaid
expenses
|
2,924
|
|
(5,658)
|
|
2,951
|
Income tax receivable
and refundable credits
|
2,603
|
|
68,251
|
|
2,221
|
Accounts
payable
|
6,743
|
|
20,591
|
|
(25,501)
|
Payroll and accrued
liabilities
|
16,924
|
|
46,177
|
|
(45,392)
|
Other
|
20,718
|
|
(25,739)
|
|
30,281
|
Net cash provided by
(used in) operating activities
|
117,277
|
|
(36,150)
|
|
(115,510)
|
Investing
activities:
|
|
|
|
|
|
Capital
expenditures
|
(80,743)
|
|
(71,150)
|
|
(96,107)
|
Proceeds from sale of
businesses, net of cash divested
|
15,351
|
|
—
|
|
—
|
Proceeds from sale of
fixed assets
|
—
|
|
53,288
|
|
4,615
|
Other
|
424
|
|
(30)
|
|
230
|
Net cash used in
investing activities
|
(64,968)
|
|
(17,892)
|
|
(91,262)
|
Financing
activities:
|
|
|
|
|
|
Proceeds from issuance
of long-term debt, net of debt issuance costs
|
924,299
|
|
—
|
|
—
|
Repayment and
refinancing of long-term debt
|
(927,046)
|
|
—
|
|
—
|
Principal payments on
long-term debt
|
(2,127)
|
|
(4,178)
|
|
(5,533)
|
(Decrease) increase in
short-term debt, net
|
(1,234)
|
|
4,093
|
|
14,935
|
Debt issuance costs
and other fees
|
(74,376)
|
|
(4,229)
|
|
—
|
Purchase of
noncontrolling interest
|
—
|
|
—
|
|
(6,279)
|
Taxes withheld and
paid on employees' share-based payment awards
|
(214)
|
|
(607)
|
|
(799)
|
Contribution from
noncontrolling interests and other
|
(439)
|
|
655
|
|
885
|
Net cash (used in)
provided by financing activities
|
(81,137)
|
|
(4,266)
|
|
3,209
|
Effects of exchange
rate changes on cash, cash equivalents and restricted
cash
|
(918)
|
|
(13)
|
|
11,113
|
Changes in cash, cash
equivalents and restricted cash
|
(29,746)
|
|
(58,321)
|
|
(192,450)
|
Cash, cash equivalents
and restricted cash at beginning of period
|
192,807
|
|
251,128
|
|
443,578
|
Cash, cash equivalents
and restricted cash at end of period
|
$ 163,061
|
|
$
192,807
|
|
$
251,128
|
|
|
|
|
|
|
Reconciliation of cash,
cash equivalents and restricted cash to the consolidated balance
sheets:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$ 154,801
|
|
$
186,875
|
|
$
248,010
|
Restricted cash
included in other current assets
|
7,244
|
|
4,650
|
|
961
|
Restricted cash
included in other assets
|
1,016
|
|
1,282
|
|
2,157
|
Total cash, cash
equivalents and restricted cash
|
$ 163,061
|
|
$
192,807
|
|
$
251,128
|
|
|
|
|
|
|
Supplemental
disclosure:
|
|
|
|
|
|
Cash paid for
interest
|
$
78,699
|
|
$ 80,163
|
|
$ 73,221
|
Cash paid (received)
for income taxes, net of refunds
|
10,301
|
|
(56,393)
|
|
6,741
|
Non-GAAP Measures
EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net
income (loss), adjusted earnings (loss) per share and free cash
flow are measures not recognized under U.S. GAAP and which exclude
certain non-cash and special items that may obscure trends and
operating performance not indicative of the Company's core
financial activities. Net new business is a measure not recognized
under U.S. GAAP which is a representation of potential incremental
future revenue but which may not fully reflect all external impacts
to future revenue. Management considers EBITDA, adjusted EBITDA,
adjusted EBITDA margin, adjusted net income (loss), adjusted
earnings (loss) per share, free cash flow and net new business to
be key indicators of the Company's operating performance and
believes that these and similar measures are widely used by
investors, securities analysts and other interested parties in
evaluating the Company's performance. In addition, similar measures
are utilized in the calculation of the financial covenants and
ratios contained in the Company's financing arrangements and
management uses these measures for developing internal budgets and
forecasting purposes. EBITDA is defined as net income (loss)
adjusted to reflect income tax expense (benefit), interest expense
net of interest income, depreciation and amortization, and adjusted
EBITDA is defined as EBITDA further adjusted to reflect certain
items that management does not consider to be reflective of the
Company's core operating performance. Adjusted net income (loss) is
defined as net income (loss) adjusted to reflect certain items that
management does not consider to be reflective of the Company's core
operating performance. Adjusted EBITDA margin is defined as
adjusted EBITDA as a percentage of sales. Adjusted basic and
diluted earnings (loss) per share is defined as adjusted net income
(loss) divided by the weighted average number of basic and diluted
shares, respectively, outstanding during the period. Free cash flow
is defined as net cash provided by operating activities minus
capital expenditures and is useful to both management and investors
in evaluating the Company's ability to service and repay its debt.
Net new business reflects anticipated sales from formally awarded
programs, less lost business, discontinued programs and
replacement programs and is based on S&P Global (IHS Markit)
forecast production volumes. The calculation of "net new business"
does not reflect customer price reductions on existing programs and
may be impacted by various assumptions embedded in the respective
calculation, including actual vehicle production levels on new
programs, foreign exchange rates and the timing of major program
launches.
When analyzing the Company's operating performance, investors
should use EBITDA, adjusted EBITDA, adjusted EBITDA margin,
adjusted net income (loss), adjusted earnings (loss) per share,
free cash flow and net new business as supplements to, and not as
alternatives for, net income (loss), operating income, or any other
performance measure derived in accordance with U.S. GAAP, and not
as an alternative to cash flow from operating activities as a
measure of the Company's liquidity. EBITDA, adjusted EBITDA,
adjusted net income (loss), adjusted earnings (loss) per share,
free cash flow and net new business have limitations as analytical
tools and should not be considered in isolation or as substitutes
for analysis of the Company's results of operations as reported
under U.S. GAAP. Other companies may report EBITDA, adjusted
EBITDA, adjusted EBITDA margin, adjusted net income (loss),
adjusted earnings (loss) per share, free cash flow and net new
business differently and therefore the Company's results may not be
comparable to other similarly titled measures of other companies.
In addition, in evaluating adjusted EBITDA and adjusted net income
(loss), it should be noted that in the future the Company may incur
expenses similar to or in excess of the adjustments in the below
presentation. This presentation of adjusted EBITDA and adjusted net
income (loss) should not be construed as an inference that the
Company's future results will be unaffected by special items.
Reconciliations of EBITDA, adjusted EBITDA, adjusted EBITDA margin,
adjusted net income (loss) and free cash flow follow.
Reconciliation of Non-GAAP Measures
EBITDA and Adjusted
EBITDA
(Dollar amounts in thousands)
|
|
The following table
provides a reconciliation of EBITDA and adjusted EBITDA from net
loss (unaudited):
|
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net loss attributable
to Cooper-Standard Holdings Inc.
|
$ (55,152)
|
|
$ (88,091)
|
|
$
(201,985)
|
|
$
(215,384)
|
Income tax (benefit)
expense
|
(528)
|
|
15,467
|
|
8,933
|
|
17,291
|
Interest expense, net
of interest income
|
32,020
|
|
21,136
|
|
130,077
|
|
78,514
|
Depreciation and
amortization
|
26,914
|
|
28,303
|
|
109,931
|
|
122,476
|
EBITDA
|
$
3,254
|
|
$ (23,185)
|
|
$
46,956
|
|
$
2,897
|
Restructuring
charges
|
5,094
|
|
5,290
|
|
18,018
|
|
18,304
|
Deconsolidation of
joint venture (1)
|
—
|
|
—
|
|
—
|
|
2,257
|
Impairment charges
(2)
|
4,114
|
|
42,873
|
|
4,768
|
|
43,710
|
Gain on sale of
businesses, net (3)
|
(920)
|
|
—
|
|
(586)
|
|
—
|
Gain on sale of fixed
assets, net (4)
|
—
|
|
—
|
|
—
|
|
(33,391)
|
Indirect tax
adjustments (5)
|
—
|
|
(68)
|
|
—
|
|
1,409
|
Loss on refinancing and
extinguishment of debt (6)
|
—
|
|
—
|
|
81,885
|
|
—
|
Pension settlement and
curtailment charges (7)
|
16,035
|
|
2,682
|
|
16,035
|
|
2,682
|
Adjusted
EBITDA
|
$
27,577
|
|
$
27,592
|
|
$ 167,076
|
|
$
37,868
|
|
|
|
|
|
|
|
|
Sales
|
$ 673,643
|
|
$ 649,337
|
|
$
2,815,879
|
|
$
2,525,391
|
Net loss
margin
|
(8.2) %
|
|
(13.6) %
|
|
(7.2) %
|
|
(8.5) %
|
Adjusted EBITDA
margin
|
4.1 %
|
|
4.2 %
|
|
5.9 %
|
|
1.5 %
|
|
|
(1)
|
Loss attributable
to deconsolidation of a joint venture in the Asia Pacific
region, which required adjustment to fair value.
|
(2)
|
Non-cash impairment
charges in 2023 related to certain assets in Europe and Asia
Pacific. Non-cash impairment charges in 2022 related to operating
performance and idle assets in certain locations in North America,
Europe and Asia Pacific.
|
(3)
|
Gain on sale of
businesses related to divestitures in 2023.
|
(4)
|
In 2022, the Company
recognized a gain on a sale-leaseback agreement on one of its
European facilities.
|
(5)
|
Impact of indirect tax
adjustments in 2022.
|
(6)
|
Loss on refinancing and
extinguishment of debt related to refinancing transactions in
2023.
|
(7)
|
Non-cash net pension
settlement and curtailment charges and administrative fees incurred
related to certain of our U.S. and non-U.S. pension
plans.
|
Adjusted Net Loss
and Adjusted Loss Per Share (Dollar amounts in thousands
except share and per share amounts)
|
|
The following table
provides a reconciliation of net loss to adjusted net loss and the
respective loss per share amounts (unaudited):
|
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net loss attributable
to Cooper-Standard Holdings Inc.
|
$
(55,152)
|
|
$
(88,091)
|
|
$
(201,985)
|
|
$
(215,384)
|
Restructuring
charges
|
5,094
|
|
5,290
|
|
18,018
|
|
18,304
|
Deconsolidation of
joint venture (1)
|
—
|
|
—
|
|
—
|
|
2,257
|
Impairment charges
(2)
|
4,114
|
|
42,873
|
|
4,768
|
|
43,710
|
Gain on sale of
businesses, net (3)
|
(920)
|
|
—
|
|
(586)
|
|
—
|
Gain on sale of fixed
assets, net (4)
|
—
|
|
—
|
|
—
|
|
(33,391)
|
Indirect tax
adjustments (5)
|
—
|
|
(68)
|
|
—
|
|
1,409
|
Loss on refinancing and
extinguishment of debt (6)
|
—
|
|
—
|
|
81,885
|
|
—
|
Pension settlement and
curtailment charges (7)
|
16,035
|
|
2,682
|
|
16,035
|
|
2,682
|
Deferred tax valuation
allowance (8)
|
—
|
|
6,834
|
|
—
|
|
6,834
|
Tax impact of adjusting
items (9)
|
(303)
|
|
(1,408)
|
|
(399)
|
|
2,075
|
Adjusted net
loss
|
$
(31,132)
|
|
$
(31,888)
|
|
$
(82,264)
|
|
$
(171,504)
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
Basic
|
17,427,183
|
|
17,218,921
|
|
17,355,392
|
|
17,190,958
|
Diluted
|
17,427,183
|
|
17,218,921
|
|
17,355,392
|
|
17,190,958
|
|
|
|
|
|
|
|
|
Loss per
share:
|
|
|
|
|
|
|
|
Basic
|
$
(3.16)
|
|
$
(5.12)
|
|
$
(11.64)
|
|
$
(12.53)
|
Diluted
|
$
(3.16)
|
|
$
(5.12)
|
|
$
(11.64)
|
|
$
(12.53)
|
|
|
|
|
|
|
|
|
Adjusted loss per
share:
|
|
|
|
|
|
|
|
Basic
|
$
(1.79)
|
|
$
(1.85)
|
|
$
(4.74)
|
|
$
(9.98)
|
Diluted
|
$
(1.79)
|
|
$
(1.85)
|
|
$
(4.74)
|
|
$
(9.98)
|
|
|
(1)
|
Loss attributable to
deconsolidation of a joint venture in the Asia Pacific region,
which required adjustment to fair value.
|
(2)
|
Non-cash impairment
charges in 2023 related to certain assets in Europe and Asia
Pacific. Non-cash impairment charges in 2022 related to operating
performance and idle assets in certain locations in North America,
Europe and Asia Pacific.
|
(3)
|
Gain on sale of
businesses related to divestitures in 2023.
|
(4)
|
In 2022, the Company
recognized a gain on a sale-leaseback agreement on one of its
European facilities.
|
(5)
|
Impact of indirect tax
adjustments in 2022.
|
(6)
|
Loss on refinancing and
extinguishment of debt related to refinancing transactions in
2023.
|
(7)
|
Non-cash net pension
settlement and curtailment charges and administrative fees incurred
related to certain of our U.S. and non-U.S. pension
plans.
|
(8)
|
In 2022, the deferred
tax valuation allowance relates to the recognition of our valuation
allowance on net deferred tax assets in Poland.
|
(9)
|
Represents the
elimination of the income tax impact of the above adjustments by
calculating the income tax impact of these adjusting items using
the appropriate tax rate for the jurisdiction where the charges
were incurred and other discrete tax expense.
|
Free Cash
Flow (Dollar amounts in thousands)
|
The following
table defines free cash flow (unaudited):
|
|
|
Quarter Ended
December 31,
|
|
Year Ended December
31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Net cash provided by
(used in) operating activities
|
$
79,661
|
|
$
(25,790)
|
|
$
117,277
|
|
$
(36,150)
|
Capital
expenditures
|
(17,559)
|
|
(12,659)
|
|
(80,743)
|
|
(71,150)
|
Free cash
flow
|
$
62,102
|
|
$
(38,449)
|
|
$
36,534
|
|
$
(107,300)
|
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SOURCE Cooper Standard