PITTSBURGH, April 27, 2020 /PRNewswire/ -- Koppers Holdings
Inc. (NYSE: KOP), an integrated global provider of treated wood
products, wood treatment chemicals and carbon compounds, today
announced its intention to provide monthly updates to the
investment community for the foreseeable future through a press
release as well as a conference call and related webcast. The
company plans to issue its next monthly business update on
May 20, 2020.
President and CEO Leroy Ball
said, "We have significantly increased our communication with many
stakeholders—which include our employees, customers, suppliers and
banking group—during this period of great uncertainty. Toward
that end, we are increasing our frequency of communication to the
public investment markets. In a global crisis like the
COVID-19 pandemic, we believe that ninety days is too long between
business updates considering the frequency and magnitude of market
movements. It is my hope that by providing more frequent
dialogue, all stakeholders will have the most up-to-date
information to inform their decision making."
Koppers believes its long-term prospects remain attractive given
its industry-leading position, end markets served and proven
business strategy. During this unprecedented time, Koppers
purpose—protecting what matters; preserving the future—has never
been more meaningful. The company has mobilized to support
the global response by continuing to supply essential products and
services that help to maintain critical rail transportation and
utility infrastructure.
Koppers remains focused on successfully navigating through this
unprecedented period by aligning its business with the following
key priorities:
- Protecting the health and safety of employees, customers and
supply chain partners.
- Providing critical products and ongoing support to its
essential customer base.
- Maintaining adequate liquidity and financial flexibility.
- Providing frequent and accurate communication to key
stakeholders.
- Advancing key initiatives in order to emerge stronger from the
crisis.
Due to the uncertainty of the scope, duration and impact of the
pandemic, the company is currently unable to reasonably estimate
its annual financial performance and is withdrawing previously
communicated 2020 financial guidance, which was provided
on February 27, 2020.
Mr. Ball stated, "It is impossible to confidently forecast the
immediate future of our business, given the uncertainty of when
businesses can begin to reopen and return toward pre-pandemic
levels. Due to the extreme uncertainty surrounding most major
markets, we are withdrawing any future earnings guidance until
further notice. From a big-picture perspective, I am
encouraged by both our nearly universal designation as an
'essential' business and the performance of our core wood
technology business during these volatile and unpredictable
times.
"We are dealing with new norms in our world, our personal lives,
and our business and we deeply appreciate the hard work and
dedication of our employees as they remain steadfast in serving our
customers and providing mission-critical products and
services. Our heartfelt concern goes to those who have
contracted the COVID-19 virus, and we salute the courage and
empathy of the healthcare community worldwide. Looking beyond
COVID-19, we believe there will be opportunities for long-term
growth and by protecting our employees, managing our operations and
aligning our cost structure in support of our business priorities,
we will be well prepared to emerge from this global crisis even
stronger."
For the first quarter of 2020, Koppers reported preliminary net
loss attributable to Koppers of $1.4
million, or $(0.07) per
diluted share, compared to net income of $11.5 million, or $0.56 per diluted share, in the prior year
quarter. Beginning in 2020, results from the pending
divestiture of Koppers (Jiangsu)
Carbon Chemical Company Limited (KJCC) are classified as held for
sale and as discontinued operations for the current year as well as
the comparable prior year period. Preliminary net income from
continuing operations attributable to Koppers for the first quarter
of 2020 was $1.9 million, or
$0.09 per diluted share, compared to
$9.7 million, or $0.47 per diluted share, in the prior year
quarter.
The preliminary adjusted net income and adjusted earnings per
share (EPS) from continuing operations were $9.9 million and $0.47 per share for the first quarter of 2020,
compared to $11.2 million and
$0.54 per share in the prior year
quarter, respectively.
Adjustments to pre-tax income totaled $10.6 million for the first quarter of 2020,
compared with $3.8 million for the
prior year quarter. For both periods, the adjustments included
restructuring expenses as well as non-cash effects related to LIFO
and mark-to-market commodity hedging.
The preliminary operating profit was $13.6 million, or 3.4 percent, compared with
$24.3 million, or 6.4 percent, in the
prior year period. The operating profit margin is calculated
as a percentage of sales.
For the first quarter of 2020, preliminary adjusted earnings
before interest, taxes, depreciation and amortization (EBITDA) was
$37.6 million, or 9.4 percent,
compared with $40.8 million, or 10.8
percent, in the prior year quarter. The adjusted EBITDA
margin is calculated as a percentage of sales.
Additional items excluded from adjusted EBITDA in the first
quarter of 2020 totaled $10.0 million
of pre-tax charges, compared with $2.3
million in the prior year quarter. For both periods,
the adjustments included restructuring expenses as well as non-cash
effects related to LIFO and mark-to-market commodity hedging.
Consolidated sales, on a preliminary basis, were $401.9 million for the first quarter of 2020, an
increase of $25.0 million, or 6.6
percent, from sales of $376.9 million
in the prior year quarter. Excluding a negative impact from
foreign currency translation of $6.3
million, sales were higher by $31.3
million, or 8.3 percent.
The Railroad and Utility Products and Services (RUPS)
performance reflected a generally favorable demand environment with
increased crosstie volumes and favorable pricing in its commercial
crosstie business as well as higher volumes of utility poles,
partially offset by continued weaker demand in its Railroad
Structures and Recovery Resources businesses. The Performance
Chemicals (PC) segment reported higher sales and profitability, on
an adjusted basis, driven by organic growth as well as market share
gains primarily in North America
and lower year-over-year raw material costs, partially offset by
lower demand in its European business. The Carbon Materials
and Chemicals (CMC) business was negatively affected by softening
demand in the global aluminum markets, and lower pricing and
inventory write-downs due to the steep decline in oil prices.
Mr. Ball commented, "I am pleased to report that, despite
dealing with an incredibly fluid business environment brought on by
the global pandemic, we completed the first quarter with only one
of more than 2,100 global employees testing positive with COVID-19,
and 31 of our 33 facilities worldwide continuing to operate without
restriction, after being designated as 'essential' by the various
jurisdictions in which we are located. Also important is that
many of the suppliers and service providers in our network are
likewise deemed to be in the 'essential' business category.
Koppers is proud to do its part to keep railroads running safely so
they can deliver critical shipments of food and other supplies;
enable utilities to continue to keep homes and businesses powered
to provide light, heat, and digital connectivity; and serve
construction markets with products to maintain critical
infrastructure.
"Our results for the first quarter are more encouraging than
they may appear, once you examine the underlying
fundamentals. The core businesses of wood treatment and wood
treatment chemicals, on a combined basis, exceeded prior year
profitability by 11 percent. Those gains, however, were
negated by tough conditions in our Australian carbon products
business, driven by lower Asian benchmark pricing and lower oil
prices. Additionally, our Railroad Structures bridge
inspection and repair business encountered extreme difficulty
working through various state restrictions meant to contain the
spread of COVID-19. On balance, it is important to note that
our focus on serving customers in the wood preservation markets
helped to lessen impact of these headwinds and kept our results
from experiencing a more dramatic decline."
First-Quarter Preliminary Financial Performance
- Sales for RUPS of $190.0 million
increased by $23.9 million, or 14.4
percent, compared to sales of $166.1
million in the prior year quarter. Excluding an
unfavorable impact from foreign currency translation of
$1.0 million, sales increased by
$24.9 million, or 15.0 percent, from
the prior year quarter. The sales increase was primarily due
to higher volumes in Class I and commercial crosstie markets, and
domestic and Australian utility pole markets as well as favorable
pricing in the commercial crosstie market, partially offset by
lower demand in maintenance-of-way businesses and an unfavorable
foreign currency impact. Preliminary operating profit for the
first quarter was $9.2 million, or
4.8 percent, compared with operating profit of $8.7 million, or 5.2 percent, in the prior year
quarter. Preliminary adjusted EBITDA for the first quarter
was $13.4 million, or 7.1 percent,
compared with $14.3 million, or 8.6
percent, in the prior year quarter. The lower profitability
was primarily due to a decrease in the maintenance-of-way business
and work restrictions related to additional COVID-19 safety
protocols, partially offset by stronger demand in the treated wood
markets for crossties and utility poles.
- Sales for PC of $111.4 million
increased by $12.4 million, or 12.5
percent, compared to sales of $99.0
million in the prior year quarter. Excluding an
unfavorable impact from foreign currency translation of
$1.9 million, sales increased by
$14.3 million, or 14.4 percent, from
the prior year quarter. Despite the global pandemic, sales
increased due to higher demand for copper-based preservatives in
North America from organic growth
as well as new customer volumes, partially offset by lower demand
in Europe and an unfavorable
currency impact. Preliminary operating profit was
$4.1 million, or 3.7 percent, for the
first quarter, compared with $12.8
million, or 12.9 percent, in the prior year quarter.
The year-over-year decrease was due to $11.0
million of mark-to-market copper hedging losses when
comparing the quarters of each year, as well as insurance proceeds
received in the prior year period. Preliminary adjusted
EBITDA was $17.0 million, or 15.3
percent, for the first quarter, compared with $15.5 million, or 15.7 percent, in the prior year
quarter. The year-over-year increase in profitability was due
to higher sales volumes and lower year-over-year raw material
prices.
- Sales for CMC totaling $100.5
million decreased by $11.3
million, or 10.1 percent, compared to sales of $111.8 million in the prior year quarter.
Excluding an unfavorable impact from foreign currency translation
of $3.4 million, sales decreased by
$7.9 million, or 7.1 percent, from
the prior year quarter. The decrease was due mainly to lower
pricing of carbon pitch globally as well as lower sales volumes of
carbon pitch in North America.
Preliminary operating profit was $0.7
million, or 0.7 percent, in the first quarter, compared with
$3.3 million, or 3.0 percent, in the
prior year quarter. Preliminary adjusted EBITDA was
$7.0 million, or 7.0 percent in the
first quarter, compared with $11.5
million, or 10.3 percent, in the prior year quarter.
The profitability declined from prior year due to a weaker demand
environment, inventory write-downs, and ongoing pricing
pressures.
- Capital expenditures for the three months ended March 31, 2020, were $10.6
million compared with $11.0
million for the prior year period.
- At March 31, 2020, total debt was
$953.1 million and, net of cash and
cash equivalents, the net debt was $898.9
million, compared with total debt of $901.2 million and net debt of $868.2 million at December
31, 2019. By comparison, the net debt was higher by
$30.7 million, primarily due to
typical first quarter working capital increases. At
March 31, 2020, the company's net
leverage ratio was 4.5.
Pending Divestiture of Koppers (Jiangsu) Carbon Chemical Company
Limited
In February, Koppers announced that it entered into a definitive
agreement to sell Koppers (Jiangsu) Carbon Chemical Company Limited
(KJCC), a 75-percent owned China
coal tar distillation business with the remaining 25 percent owned
by Yizhou Group Company Limited.
The KJCC facility, located in Pizhou City in Jiangsu Province, was shut down in the fourth
quarter of 2019 for planned maintenance and remained closed through
much of March 2020 due to concerns
related to COVID-19. At this time, Koppers employees in
China have been reported safe and
the facility is fully operational.
On April 16, 2020, the pending
divestiture reached another milestone by filing for antitrust
approval with China's State
Administration for Market Regulation of China (SAMR) and a decision is anticipated to
be issued by June 2020. The closing of the transaction is
expected to be in August 2020,
consistent with the original timeline that was previously
announced. Koppers expects to realize approximately
$65 million of net cash, after taxes
and expenses, and plans to apply the cash proceeds toward debt
reduction.
Debt and Liquidity
As of March 31, 2020, Koppers was
well within its financial covenant metrics and had $185 million of liquidity to continue operations
with no major changes. While a global economic downturn will
negatively impact its earnings potential, the company has already
launched several cost-reduction initiatives and contingency plans
to maintain a strong foundation during this period. Also,
additional measures have been identified and can be enacted rapidly
as needed to combat a longer or deeper downturn. The company
continues to intently focus on raising and conserving cash in all
aspects of its operations as part of driving additional cushion in
its financial covenants. Moreover, Koppers has a track record
of disciplined debt reduction and the company believes it is well
positioned to navigate through the current crisis and, ultimately,
capitalize on an eventual recovery.
Investor Conference Call and Webcast
Koppers management will conduct a conference call this morning,
beginning at 11:00 a.m. Eastern Time
to discuss its business update related to the COVID-19 pandemic as
well as the company's preliminary results for the quarter.
Presentation materials will be available at least 15 minutes before
the call on www.koppers.com in the Investor Relations section of
the company's website.
Interested parties may access the live audio broadcast toll free
by dialing 1-833-366-1128 in the
United States and Canada,
or 1-412-902-6774 for international, Conference ID number
10142801. Participants are requested to access the call at least
five minutes before the scheduled start time to complete a brief
registration.
The conference call will be broadcast live online at:
https://services.choruscall.com/links/koppers200427.html.
(Due to the length of this URL, it may be necessary to copy and
paste this hyperlink into the internet browser's URL address
field.)
An audio replay will be available approximately two hours after
the completion of the call at 1-877-344-7529 for U.S. toll free,
1-855-669-9658 for Canada toll
free, or 1-412-317-0088 for international, Conference ID number
10142801. The recording will be available for replay through
May 29, 2020.
About Koppers
Koppers, with corporate headquarters in Pittsburgh, Pennsylvania, is an integrated
global provider of treated wood products, wood treatment chemicals
and carbon compounds. Our products and services are used in a
variety of niche applications in a diverse range of end markets,
including the railroad, specialty chemical, utility, residential
lumber, agriculture, aluminum, steel, rubber, and construction
industries. Including our joint ventures, we serve our
customers through a comprehensive global manufacturing and
distribution network, with facilities located in North America, South
America, Australasia, China
and Europe. The stock of Koppers Holdings Inc. is publicly
traded on the New York Stock Exchange under the symbol "KOP."
For more information, visit us on the Web: www.koppers.com.
Questions concerning investor relations should be directed to
Michael Zugay at 412-227-2231 or
Quynh McGuire at 412-227-2049.
Non-GAAP Financial Measures
This press release contains certain non-GAAP financial
measures. Koppers believes that adjusted EBITDA, adjusted
EBITDA margin, adjusted net income, adjusted earnings per share,
net debt and net leverage ratio provide information useful to
investors in understanding the underlying operational performance
of the company, its business and performance trends, and facilitate
comparisons between periods and with other corporations in similar
industries. The exclusion of certain items permits evaluation
and a comparison of results for ongoing business operations, and it
is on this basis that Koppers management internally assesses the
company's performance. In addition, the Board of Directors
and executive management team use adjusted EBITDA as a performance
measure under the company's annual incentive plans.
Although Koppers believes that these non-GAAP financial measures
enhance investors' understanding of its business and performance,
these non-GAAP financial measures should not be considered an
alternative to GAAP basis financial measures and should be read in
conjunction with the relevant GAAP financial measure. Other
companies in a similar industry may define or calculate these
measures differently than the company, limiting their usefulness as
comparative measures. Because of these limitations, these
non-GAAP financial measures should not be considered in isolation
or as substitutes for performance measures calculated in accordance
with GAAP.
See the attached tables for the following reconciliations of
non-GAAP financial measures included in this press release:
Unaudited Reconciliation of Operating Profit to EBITDA and Adjusted
EBITDA; Unaudited Reconciliation of Net Income to EBITDA and
Adjusted EBITDA; Unaudited Reconciliation of Net Income
Attributable to Koppers and Adjusted Net Income; Unaudited
Reconciliation of Diluted Earnings Per Share and Adjusted Earnings
Per Share; Unaudited Reconciliation of Total Debt to Net Debt and
Net Leverage Ratio; and Unaudited Reconciliation of Net Income to
EBITDA and Adjusted EBITDA on a Latest Twelve Month Basis.
Safe Harbor Statement
Certain statements in this press release are "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995 and may include, but are not limited to,
statements about sales levels, acquisitions, restructuring,
declines in the value of Koppers assets and the effect of any
resulting impairment charges, profitability and anticipated
expenses and cash outflows. All forward-looking statements
involve risks and uncertainties. All statements contained herein
that are not clearly historical in nature are forward-looking, and
words such as "outlook," "guidance," "forecast," "believe,"
"anticipate," "expect," "estimate," "may," "will," "should,"
"continue," "plan," "potential," "intend," "likely," or other
similar words or phrases are generally intended to identify
forward-looking statements. Any forward-looking statement
contained herein, in other press releases, written statements or
other documents filed with the Securities and Exchange Commission,
or in Koppers communications and discussions with investors and
analysts in the normal course of business through meetings, phone
calls and conference calls, regarding expectations with respect to
sales, earnings, cash flows, operating efficiencies,
restructurings, the benefits of acquisitions, divestitures, joint
ventures or other matters as well as financings and debt reduction,
are subject to known and unknown risks, uncertainties and
contingencies.
Many of these risks, uncertainties and contingencies are beyond
our control, and may cause actual results, performance or
achievements to differ materially from anticipated results,
performance or achievements. Factors that might affect such
forward-looking statements include, among other things, the impact
of changes in commodity prices, such as oil and copper, on product
margins; general economic and business conditions; the length and
extent of economic contraction as a result of the coronavirus
(COVID-19) pandemic; disruption in the U.S. and global financial
markets; potential difficulties in protecting our intellectual
property; the ratings on our debt and our ability to repay or
refinance our outstanding indebtedness as it matures; our ability
to operate within the limitations of our debt covenants; potential
impairment of our goodwill and/or long-lived assets; demand for
Koppers goods and services; competitive conditions; interest rate
and foreign currency rate fluctuations; availability and costs of
key raw materials; unfavorable resolution of claims against us, as
well as those discussed more fully elsewhere in this release and in
documents filed with the Securities and Exchange Commission by
Koppers, particularly our latest annual report on Form 10-K and any
subsequent filings by Koppers with the Securities and Exchange
Commission. Any forward-looking statements in this release
speak only as of the date of this release, and we undertake no
obligation to update any forward-looking statement to reflect
events or circumstances after that date or to reflect the
occurrence of unanticipated events.
Unaudited Segment Information
The following tables set forth certain sales and operating data,
net of all intersegment transactions, for the company's businesses
for the periods indicated.
|
|
Three Months Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
(Dollars in
millions)
|
|
(Preliminary)
|
|
|
|
|
|
Net sales:
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
$
|
190.0
|
|
|
$
|
166.1
|
|
Performance
Chemicals
|
|
|
111.4
|
|
|
|
99.0
|
|
Carbon Materials and
Chemicals
|
|
|
100.5
|
|
|
|
111.8
|
|
Total
|
|
$
|
401.9
|
|
|
$
|
376.9
|
|
Operating profit
(loss):
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
$
|
9.2
|
|
|
$
|
8.7
|
|
Performance
Chemicals
|
|
|
4.1
|
|
|
|
12.8
|
|
Carbon Materials and
Chemicals
|
|
|
0.7
|
|
|
|
3.3
|
|
Corporate
Unallocated
|
|
|
(0.4)
|
|
|
|
(0.5)
|
|
Total
|
|
$
|
13.6
|
|
|
$
|
24.3
|
|
Operating profit
margin:
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
|
4.8
|
%
|
|
|
5.2
|
%
|
Performance
Chemicals
|
|
|
3.7
|
%
|
|
|
12.9
|
%
|
Carbon Materials and
Chemicals
|
|
|
0.7
|
%
|
|
|
3.0
|
%
|
Total
|
|
|
3.4
|
%
|
|
|
6.4
|
%
|
Depreciation and
amortization:
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
$
|
4.9
|
|
|
$
|
4.8
|
|
Performance
Chemicals
|
|
|
4.5
|
|
|
|
4.9
|
|
Carbon Materials and
Chemicals
|
|
|
4.1
|
|
|
|
3.9
|
|
Total
|
|
$
|
13.5
|
|
|
$
|
13.6
|
|
Adjusted
EBITDA(1):
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
$
|
13.4
|
|
|
$
|
14.3
|
|
Performance
Chemicals
|
|
|
17.0
|
|
|
|
15.5
|
|
Carbon Materials and
Chemicals
|
|
|
7.0
|
|
|
|
11.5
|
|
Corporate
Unallocated
|
|
|
0.2
|
|
|
|
(0.5)
|
|
Total
|
|
$
|
37.6
|
|
|
$
|
40.8
|
|
Adjusted EBITDA
margin(2):
|
|
|
|
|
|
|
|
|
Railroad and
Utility Products and Services
|
|
|
7.1
|
%
|
|
|
8.6
|
%
|
Performance
Chemicals
|
|
|
15.3
|
%
|
|
|
15.7
|
%
|
Carbon Materials and
Chemicals
|
|
|
7.0
|
%
|
|
|
10.3
|
%
|
Total
|
|
|
9.4
|
%
|
|
|
10.8
|
%
|
|
|
(1)
|
The tables below
describe the adjustments to EBITDA for the quarters ended March
31,
2020 and 2019, respectively.
|
(2)
|
Adjusted EBITDA as a
percentage of GAAP sales.
|
UNAUDITED
RECONCILIATION OF OPERATING PROFIT TO EBITDA AND ADJUSTED
EBITDA
|
(In
millions)
|
|
|
|
Three Months Ended
March 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
|
|
RUPS
|
|
|
PC
|
|
|
CMC
|
|
|
Unallocated
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Preliminary)
|
|
Operating profit
(loss)
|
|
$
|
9.2
|
|
|
$
|
4.1
|
|
|
$
|
0.7
|
|
|
$
|
(0.4)
|
|
|
$
|
13.6
|
|
Other income
(loss)
|
|
|
(0.3)
|
|
|
|
0.5
|
|
|
|
(0.4)
|
|
|
|
0.6
|
|
|
|
0.4
|
|
Depreciation and
amortization
|
|
|
4.9
|
|
|
|
4.5
|
|
|
|
4.1
|
|
|
|
0.0
|
|
|
|
13.5
|
|
EBITDA with
noncontrolling interest
|
|
$
|
13.8
|
|
|
$
|
9.1
|
|
|
$
|
4.4
|
|
|
$
|
0.2
|
|
|
$
|
27.5
|
|
Unusual items
impacting EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CMC
restructuring
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
2.7
|
|
|
|
0.0
|
|
|
|
2.7
|
|
Non-cash LIFO
benefit
|
|
|
(0.4)
|
|
|
|
0.0
|
|
|
|
(0.1)
|
|
|
|
0.0
|
|
|
|
(0.5)
|
|
Mark-to-market
commodity hedging
|
|
|
0.0
|
|
|
|
7.9
|
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
7.9
|
|
Adjusted
EBITDA
|
|
$
|
13.4
|
|
|
$
|
17.0
|
|
|
$
|
7.0
|
|
|
$
|
0.2
|
|
|
$
|
37.6
|
|
|
|
|
|
|
|
|
UNAUDITED
RECONCILIATION OF OPERATING PROFIT TO EBITDA AND ADJUSTED
EBITDA
|
(In
millions)
|
|
|
|
Three Months Ended
March 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
|
|
RUPS
|
|
|
PC
|
|
|
CMC
|
|
|
Unallocated
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit
(loss)
|
|
$
|
8.7
|
|
|
$
|
12.8
|
|
|
$
|
3.3
|
|
|
$
|
(0.5)
|
|
|
$
|
24.3
|
|
Other income
(loss)
|
|
|
(0.2)
|
|
|
|
0.9
|
|
|
|
(0.1)
|
|
|
|
0.0
|
|
|
|
0.6
|
|
Depreciation and
amortization
|
|
|
4.8
|
|
|
|
4.9
|
|
|
|
3.9
|
|
|
|
0.0
|
|
|
|
13.6
|
|
Depreciation in
impairment and restructuring charges
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
0.2
|
|
|
|
0.0
|
|
|
|
0.2
|
|
EBITDA with
noncontrolling interest
|
|
$
|
13.3
|
|
|
$
|
18.6
|
|
|
$
|
7.3
|
|
|
$
|
(0.5)
|
|
|
$
|
38.7
|
|
Unusual items
impacting EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CMC
restructuring
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
4.2
|
|
|
|
0.0
|
|
|
|
4.2
|
|
Non-cash LIFO
expense
|
|
|
1.0
|
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
1.0
|
|
Mark-to-market
commodity hedging
|
|
|
0.0
|
|
|
|
(3.1)
|
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
(3.1)
|
|
Adjusted
EBITDA
|
|
$
|
14.3
|
|
|
$
|
15.5
|
|
|
$
|
11.5
|
|
|
$
|
(0.5)
|
|
|
$
|
40.8
|
|
UNAUDITED
RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED
EBITDA
|
(In
millions)
|
|
|
Three Months Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
|
|
(Preliminary)
|
|
|
|
|
|
Net (loss)
income
|
|
$
|
(2.5)
|
|
|
$
|
12.4
|
|
Interest
expense
|
|
|
14.0
|
|
|
|
16.2
|
|
Depreciation and
amortization
|
|
|
13.5
|
|
|
|
13.6
|
|
Depreciation in
impairment and restructuring charges
|
|
|
0.0
|
|
|
|
0.2
|
|
Income
taxes
|
|
|
(1.8)
|
|
|
|
(1.2)
|
|
Loss (income) from
discontinued operations
|
|
|
4.4
|
|
|
|
(2.7)
|
|
EBITDA with
noncontrolling interests
|
|
|
27.6
|
|
|
|
38.5
|
|
Unusual items
impacting net income
|
|
|
|
|
|
|
|
|
Impairment,
restructuring and plant closure costs
|
|
|
2.7
|
|
|
|
4.3
|
|
Non-cash LIFO
(benefit) expense
|
|
|
(0.6)
|
|
|
|
1.1
|
|
Mark-to-market
commodity hedging
|
|
|
7.9
|
|
|
|
(3.1)
|
|
Total
adjustments
|
|
|
10.0
|
|
|
|
2.3
|
|
Adjusted
EBITDA
|
|
$
|
37.6
|
|
|
$
|
40.8
|
|
|
|
|
|
|
|
|
UNAUDITED
RECONCILIATION OF NET INCOME ATTRIBUTABLE TO KOPPERS AND ADJUSTED
NET INCOME
|
(In
millions)
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
|
|
(Preliminary)
|
|
|
|
|
|
Net (loss) income
attributable to Koppers
|
|
$
|
(1.4)
|
|
|
$
|
11.5
|
|
Unusual items
impacting net income
|
|
|
|
|
|
|
|
|
Impairment,
restructuring and plant closure costs
|
|
|
3.3
|
|
|
|
5.9
|
|
Non-cash LIFO
(benefit) expense
|
|
|
(0.6)
|
|
|
|
1.0
|
|
Mark-to-market
commodity hedging
|
|
|
7.9
|
|
|
|
(3.1)
|
|
Total
adjustments
|
|
|
10.6
|
|
|
|
3.8
|
|
Adjustments to income
tax and noncontrolling interests
|
|
|
|
|
|
|
|
|
Income tax on
adjustments to pre-tax income
|
|
|
(2.6)
|
|
|
|
(2.3)
|
|
Noncontrolling
interests
|
|
|
(1.1)
|
|
|
|
0.9
|
|
Effect on adjusted net
income
|
|
|
6.9
|
|
|
|
2.4
|
|
Adjusted net income
including discontinued operations
|
|
|
5.5
|
|
|
|
13.9
|
|
Loss (income) from
discontinued operations
|
|
|
4.4
|
|
|
|
(2.7)
|
|
Adjusted net income
attributable to Koppers
|
|
$
|
9.9
|
|
|
$
|
11.2
|
|
|
|
|
|
|
|
|
UNAUDITED
RECONCILIATION OF DILUTED EARNINGS PER SHARE AND
|
ADJUSTED EARNINGS
PER SHARE
|
(In millions
except share amounts)
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
|
|
(Preliminary)
|
|
|
|
|
|
Net (loss) income
attributable to Koppers
|
|
$
|
(1.4)
|
|
|
$
|
11.5
|
|
Adjusted net income
attributable to Koppers
|
|
$
|
9.9
|
|
|
$
|
11.2
|
|
Denominator for
diluted earnings per share (in thousands)
|
|
|
21,315
|
|
|
|
20,881
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Diluted (loss)
earnings per share
|
|
$
|
(0.07)
|
|
|
$
|
0.56
|
|
Adjusted earnings per
share
|
|
$
|
0.47
|
|
|
$
|
0.54
|
|
UNAUDITED
RECONCILIATION OF TOTAL DEBT TO NET DEBT AND NET LEVERAGE
RATIO
|
(In
millions)
|
|
|
Twelve months
ended
|
|
|
|
March
31,
2020
|
|
|
December 31,
2019
|
|
|
September
30,
2019
|
|
|
June
30,
2019
|
|
|
March
31,
2019
|
|
|
|
(Preliminary)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Debt
|
|
$
|
953.1
|
|
|
$
|
901.2
|
|
|
$
|
959.1
|
|
|
$
|
1,007.2
|
|
|
$
|
1,012.7
|
|
Less: Cash
|
|
|
54.2
|
|
|
|
33.0
|
|
|
|
40.7
|
|
|
|
42.1
|
|
|
|
38.1
|
|
Net Debt
|
|
$
|
898.9
|
|
|
$
|
868.2
|
|
|
$
|
918.4
|
|
|
$
|
965.1
|
|
|
$
|
974.6
|
|
Adjusted
EBITDA
|
|
$
|
197.9
|
|
|
$
|
201.1
|
|
|
$
|
206.6
|
|
|
$
|
203.4
|
|
|
$
|
191.5
|
|
Net Leverage
Ratio
|
|
|
4.5
|
|
|
|
4.3
|
|
|
|
4.4
|
|
|
|
4.7
|
|
|
|
5.1
|
|
|
|
|
|
|
|
|
UNAUDITED
RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED
EBITDA
|
ON A LATEST TWELVE
MONTH BASIS
|
(In
millions)
|
|
|
|
Twelve months
ended
|
|
|
|
March
31,
2020
|
|
|
December 31,
2019
|
|
|
September
30,
2019
|
|
|
June
30,
2019
|
|
|
March
31,
2019
|
|
|
|
(Preliminary)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
52.4
|
|
|
$
|
67.4
|
|
|
$
|
44.8
|
|
|
$
|
31.4
|
|
|
$
|
18.0
|
|
Interest
expense
|
|
|
59.8
|
|
|
|
61.9
|
|
|
|
63.4
|
|
|
|
62.2
|
|
|
|
60.2
|
|
Depreciation and
amortization
|
|
|
54.3
|
|
|
|
54.6
|
|
|
|
53.5
|
|
|
|
52.0
|
|
|
|
52.6
|
|
Income tax
provision
|
|
|
(0.6)
|
|
|
|
0.0
|
|
|
|
11.9
|
|
|
|
17.7
|
|
|
|
15.5
|
|
Discontinued
operations, net of tax
|
|
|
3.4
|
|
|
|
(3.7)
|
|
|
|
(5.7)
|
|
|
|
(1.4)
|
|
|
|
(3.4)
|
|
EBITDA with
noncontrolling interests
|
|
|
169.3
|
|
|
|
180.2
|
|
|
|
167.9
|
|
|
|
161.9
|
|
|
|
142.9
|
|
Unusual items
impacting net income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment,
restructuring and plant
closure
|
|
|
18.8
|
|
|
|
20.4
|
|
|
|
26.1
|
|
|
|
27.2
|
|
|
|
23.5
|
|
Non-cash LIFO
expense
|
|
|
2.8
|
|
|
|
4.5
|
|
|
|
11.2
|
|
|
|
11.6
|
|
|
|
12.0
|
|
Mark-to-market
commodity hedging
|
|
|
7.0
|
|
|
|
(4.0)
|
|
|
|
1.3
|
|
|
|
1.1
|
|
|
|
0.3
|
|
Acquisition and exit
activity related
costs
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
0.1
|
|
|
|
1.6
|
|
|
|
12.8
|
|
Adjusted EBITDA with
noncontrolling
interests
|
|
$
|
197.9
|
|
|
$
|
201.1
|
|
|
$
|
206.6
|
|
|
$
|
203.4
|
|
|
$
|
191.5
|
|
|
|
|
For Information:
|
|
Michael J. Zugay,
Chief Financial Officer
|
|
|
412 227
2231
|
|
|
ZugayMJ@koppers.com
|
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SOURCE Koppers