Superior Affirms Strong Liquidity Position and Provides Update Regarding COVID-19
March 23 2020 - 4:01PM
Business Wire
Superior Industries International, Inc. (NYSE:SUP), one
of the world’s leading aluminum wheel suppliers, today provided a
business update regarding COVID-19, and its impact on the
automotive industry and Superior’s operations.
The impact from the COVID-19 pandemic has driven unprecedented
market volatility over the last several weeks and is having a
widespread adverse effect on the automotive industry on both
consumer demand and OEM automotive production. While the extent of
the impact is unknown and the situation is evolving rapidly, key
customers have announced temporary closure of nearly all production
facilities in Europe and North America. The announced timing and
duration of these closures varies by customer and facility, but the
outcome is highly uncertain.
In light of this uncertainty, Superior is taking further action
to both ensure the health and safety of its employees globally and
respond to the current industry production environment by reducing
costs and managing liquidity. The Company anticipates that
production at all its facilities will be halted in the coming days;
however, the duration of these closures will be dependent on how
the situation evolves.
Other actions to minimize the impact of the lower production
levels on profit and cash flow include significantly reducing
capital expenditures, balancing the Company’s labor force with the
production outlook, and reducing discretionary spending.
In addition, out of an abundance of caution in this uncertain
time, the Company has fully drawn its $160 million U.S. revolving
credit line and has drawn €48 million on its €60 million European
revolving credit line. Both revolving credit facilities mature in
May 2022. Superior does not anticipate any issues meeting the
financial covenants under these facilities. These funds, along with
existing cash already on hand, afford Superior significant
available cash liquidity. The Company has no other significant
funded debt obligations until May 2024. Superior has maintained
liquidity levels in line with year-end 2019, well in excess of $250
million.
Finally, due to the current unprecedented economic uncertainty
in North America and Europe, Superior is suspending its previously
provided full year 2020 Outlook. Superior will provide additional
details around its outlook for 2020 during the first quarter 2020
earnings call.
Majdi Abulaban, President and Chief Executive Officer of
Superior commented, “In the face of the uncertainty created by
COVID-19, we must decisively take the necessary precautionary
measures to protect our employees, while managing Superior’s
operations, costs, and liquidity prudently. The management team at
Superior is planning for various possible scenarios and will take
action accordingly as we move forward.”
Mr. Abulaban continued, “As we demonstrated in 2019, we believe
that we are well prepared to move swiftly to adapt our business to
changing production levels. I feel very confident in our company’s
and employees’ ability to manage through this very challenging
time.”
About Superior Industries
Superior is one of the world’s leading aluminum wheel suppliers.
Superior’s team collaborates and partners with customers to design,
engineer and manufacture a wide variety of innovative and
high-quality products utilizing the latest lightweighting and
finishing technologies. Superior also maintains leading aftermarket
brands including ATS®, RIAL®, ALUTEC®, and ANZIO®. Headquartered in
Southfield, Michigan, Superior is listed on the New York Stock
Exchange. For more information, please visit www.supind.com.
Forward-Looking Statements
This press release contains statements that are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Forward-looking statements include all
statements that do not relate solely to historical or current facts
and can generally be identified by the use of future dates or words
such as “may,” “should,” “could,” “will,” “expects,” “expected,”
“seeks to,” “anticipates,” “plans,” “believes,” “estimates,”
“intends,” “outlook”, “predicts,” “projects,” “potential” or
“continue,” or the negative of such terms and other comparable
terminology. These statements also include, but are not limited to,
those related to Superior’s ability to withstand current market
conditions and the evolving impact of COVID-19, access to the
credit markets, Superior’s ability to continue to deliver in 2020
the positive financial trends it delivered in 2019, Superior’s
financial flexibility, trends in Superior’s financial results,
Superior’s ability to continue to enhance cash generation and pay
down debt, Superior’s competitive position, Superior’s ability to
continue to introduce market-leading product offerings with
differentiating technologies, Superior’s ability to reduce costs,
Superior’s ability to re-align its business to changing production
levels, and trends in the aluminum wheel industry. These statements
are based on current expectations, estimates, and projections about
Superior's business based, in part, on assumptions made by
management. These statements are not guarantees of future
performance and involve risks, uncertainties, and assumptions that
are difficult to predict. Therefore, actual outcomes and results
may differ materially from what is expressed or forecasted in such
forward-looking statements due to numerous factors, risks, and
uncertainties discussed in Superior's Securities and Exchange
Commission filings and reports, including Superior's Annual Report
on Form 10-K, and other reports from time to time filed with the
Securities and Exchange Commission. You are cautioned not to unduly
rely on such forward-looking statements when evaluating the
information presented in this press release. Such forward-looking
statements speak only as of the date on which they are made, and
Superior does not undertake any obligation to update any
forward-looking statement to reflect events or circumstances after
the date of this release.
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version on businesswire.com: https://www.businesswire.com/news/home/20200323005647/en/
Superior Investor Relations: (248) 234-7104 Troy Ford
Investor.Relations@supind.com
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