Fiscal Year 2023 Highlights
- Net sales of
$357.7 million , down 5.2% from$377.4 million in the prior year; and product sales of$347.4 million , down 3.2% from the prior year. Sales declined primarily due to lower end-market demand in building products and industrial and utility verticals, partially offset by increased demand in heavy-duty truck and new program launches. - Gross margin of
$64.5 million , or 18.0% of net sales, compared to$52.4 million or 13.9% of net sales, in the prior year. - Selling, general and administrative expenses of
$38.0 million , or 10.6% of net sales, compared to$34.4 million or 9.1% of net sales, in the prior year same period. - Operating income of
$26.5 million , or 7.4% of net sales, versus operating income of$18.0 million , or 4.8% of net sales, in the prior year. - Net income of
$20.3 million , or$2.31 per diluted share, compared to net income of$12.2 million , or$1.44 per diluted share, a year ago. - Adjusted EBITDA1 of
$42.3 million , or 11.8% of net sales, compared to$31.9 million , or 8.5% of net sales, in the prior year. - Free Cash Flow1 was
$25.7 million for the year, total liquidity at year-end was$74.1 million , and the Debt to Trailing Twelve Months Adjusted EBITDA1 was less than 1 times or .54 times.
Fourth Quarter 2023 Highlights
- Net sales of
$73.8 million , down 14.7% from$86.4 million in the prior year; and product sales of$72.4 million , down 12.9% from the prior year. Sales declined primarily due to lower demand from customers in building products and industrial and utilities markets. - Gross margin of
$10.9 million , or 14.8% of net sales, compared to$11.5 million or 13.4% of net sales, in the prior year. - Selling, general and administrative expenses of
$8.4 million , or 11.4% of net sales, compared to$8.6 million or 9.9% of net sales, in the prior year same period. - Operating income of
$2.5 million , or 3.4% of net sales, versus$3.0 million , or 3.4% of net sales, in the prior year. - Net income of
$2.2 million , or$0.25 per diluted share, compared to net income of$4.8 million , or$0.57 per diluted share, a year ago. - Adjusted EBITDA1 of
$6.5 million , or 8.9% of net sales, compared to$6.1 million , or 7.0% of net sales in the prior year.
1 Adjusted EBITDA, Free Cash Flow and Debt to Trailing Twelve Months Adjusted EBITDA are non-GAAP financial measures as defined and reconciled below.
2023 Capital Expenditures
The Company’s capital expenditures for 2023 were
Financial Position at
The Company’s total liquidity at the end of 2023 was
1Debt to Trailing Twelve Months Adjusted EBITDA, Adjusted EBITDA and return on capital employed are metrics and non-GAAP financial measures as defined and reconciled below.
Conference Call
The Company will conduct a conference call today at
About
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the federal securities laws that are subject to risks and uncertainties. These statements often include words such as “believe”, “anticipate”, “plan”, “expect”, “intend”, “will”, “should”, “could”, “would”, “project”, “continue”, “likely”, and similar expressions. In particular, this press release may contain forward-looking statements about the Company’s expectations for future periods with respect to its plans to improve financial results, the future of the Company’s end markets. Factors that could cause actual results to differ from those reflected in forward-looking statements relating to our operations and business include: dependence on certain major customers, and potential loss of any major customer due to completion of existing production programs or otherwise; general macroeconomic, social, regulatory and political conditions, including uncertainties surrounding volatility in financial markets; changes in the plastics, transportation, marine and commercial product industries (including changes in demand for production), efforts of the Company to expand its customer base and develop new products to diversify markets, materials and processes and increase operational enhancements; the Company’s initiatives to quote and execute manufacturing processes for new business, acquire raw materials, address inflationary pressures, regulatory matters and labor relations; the Company’s financial position or other financial information; and other risks and uncertainties described in the Company’s filings with the
Company Contact:
Executive Vice President & Chief Financial Officer
jzimmer@coremt.com
Investor Relations Contact:
Three
214-616-2207
- Financial Statements Follow –
Consolidated Statements of Operations (in thousands, except share and per share data) | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
Net sales: | |||||||||||||||
Products | $ | 72,439 | $ | 83,143 | $ | 347,375 | $ | 358,701 | |||||||
Tooling | 1,339 | 3,300 | 10,363 | 18,675 | |||||||||||
Total net sales | 73,778 | 86,443 | 357,738 | 377,376 | |||||||||||
Total cost of sales | 62,841 | 74,896 | 293,218 | 324,974 | |||||||||||
Gross margin | 10,937 | 11,547 | 64,520 | 52,402 | |||||||||||
Selling, general and administrative expense | 8,420 | 8,573 | 37,983 | 34,399 | |||||||||||
Operating income | 2,517 | 2,974 | 26,537 | 18,003 | |||||||||||
Other income and expense | |||||||||||||||
Loss due to the extinguishment of debt | — | — | — | 1,582 | |||||||||||
Interest expense | 175 | 449 | 1,011 | 1,960 | |||||||||||
Net periodic post-retirement benefit | (63 | ) | (31 | ) | (220 | ) | (124 | ) | |||||||
Total other income and expense | 112 | 418 | 791 | 3,418 | |||||||||||
Income before income taxes | 2,405 | 2,556 | 25,746 | 14,585 | |||||||||||
Income tax (benefit) expense | 223 | (2,276 | ) | 5,422 | 2,382 | ||||||||||
Net income | $ | 2,182 | $ | 4,832 | $ | 20,324 | $ | 12,203 | |||||||
Net income per common share: | |||||||||||||||
Basic | $ | 0.25 | $ | 0.57 | $ | 2.37 | $ | 1.44 | |||||||
Diluted | $ | 0.25 | $ | 0.57 | $ | 2.31 | $ | 1.44 |
Product Sales by Market (unaudited, in thousands) | |||||||||||||||
Three Months Ended | Year Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
Medium and heavy-duty truck | $ | 40,626 | $ | 41,641 | $ | 181,376 | $ | 158,649 | |||||||
Power sports | 20,115 | 21,666 | 84,688 | 84,727 | |||||||||||
Building products | 1,879 | 5,027 | 28,743 | 41,038 | |||||||||||
Industrial and Utilities | 4,231 | 5,735 | 23,658 | 27,988 | |||||||||||
All Other | 5,590 | 9,344 | 28,910 | 46,299 | |||||||||||
Net Product Revenue | $ | 72,441 | $ | 83,413 | $ | 347,375 | $ | 358,701 |
Consolidated Balance Sheets (in thousands) | |||||||
Year Ended | |||||||
2023 | 2022 | ||||||
Assets: | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 24,104 | $ | 4,183 | |||
Accounts receivable, net | 41,711 | 44,261 | |||||
Inventories, net | 22,063 | 23,871 | |||||
Prepaid expenses and other current assets | 15,001 | 8,350 | |||||
Total current assets | 102,879 | 80,665 | |||||
Right of use asset | 3,802 | 5,114 | |||||
Property, plant and equipment, net | 81,185 | 83,267 | |||||
17,376 | 17,376 | ||||||
Intangibles, net | 6,017 | 7,619 | |||||
Other non-current assets | 2,118 | 4,574 | |||||
Total Assets | $ | 213,377 | $ | 198,615 | |||
Liabilities and Stockholders' Equity: | |||||||
Liabilities: | |||||||
Current liabilities: | |||||||
Current portion of long-term debt | $ | 1,468 | $ | 1,208 | |||
Revolving debt | — | 1,864 | |||||
Accounts payable | 23,958 | 29,586 | |||||
Contract liabilities | 5,204 | 1,395 | |||||
Compensation and related benefits | 10,498 | 9,101 | |||||
Accrued other liabilities | 5,058 | 7,643 | |||||
Total current liabilities | 46,186 | 50,797 | |||||
Other non-current liabilities | 3,759 | 3,516 | |||||
Long-term debt | 21,519 | 22,986 | |||||
Post retirement benefits liability | 2,960 | 5,191 | |||||
Total Liabilities | 74,424 | 82,490 | |||||
Stockholders' Equity: | |||||||
Common stock | 86 | 84 | |||||
Paid in capital | 43,265 | 40,342 | |||||
Accumulated other comprehensive income, net of income taxes | 5,301 | 3,053 | |||||
(31,768 | ) | (29,099 | ) | ||||
Retained earnings | 122,069 | 101,745 | |||||
Total Stockholders' Equity | 138,953 | 116,125 | |||||
Total Liabilities and Stockholders' Equity | $ | 213,377 | $ | 198,615 |
Consolidated Statements of Cash Flows (in thousands) | |||||||
Year Ended | |||||||
2023 | 2022 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 20,324 | $ | 12,203 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 12,912 | 11,884 | |||||
Deferred income tax | 2,473 | (3,469 | ) | ||||
Share-based compensation | 2,923 | 2,329 | |||||
Loss on the disposal of assets | 80 | — | |||||
Loss on extinguishment of debt | — | 1,234 | |||||
Losses (Gain) on foreign currency | (58 | ) | 396 | ||||
Change in operating assets and liabilities: | |||||||
Accounts receivable | 2,550 | (9,000 | ) | ||||
Inventories | 1,808 | 1,258 | |||||
Prepaid and other assets | (5,825 | ) | 928 | ||||
Accounts payable | (4,916 | ) | 5,999 | ||||
Accrued and other liabilities | 3,551 | (4,067 | ) | ||||
Post retirement benefits liability | (980 | ) | (713 | ) | |||
Net cash provided by operating activities | 34,842 | 18,982 | |||||
Cash flows from investing activities: | |||||||
Purchase of property, plant and equipment | (9,100 | ) | (16,588 | ) | |||
Proceeds from sale of property, plant and equipment | — | — | |||||
Net cash used in investing activities | (9,100 | ) | (16,588 | ) | |||
Cash flows from financing activities: | |||||||
Gross borrowings on revolving loans | 37,098 | 165,172 | |||||
Gross repayment on revolving loans | (38,962 | ) | (167,732 | ) | |||
Proceeds from term loan | — | 25,000 | |||||
Payment on principal of term loans | (1,288 | ) | (25,913 | ) | |||
Payment of deferred loan costs | — | (402 | ) | ||||
Payments for taxes related to net share settlement of equity awards | (2,669 | ) | (482 | ) | |||
Net cash used in financing activities | (5,821 | ) | (4,357 | ) | |||
Net change in cash and cash equivalents | 19,921 | (1,963 | ) | ||||
Cash and cash equivalents at beginning of year | 4,183 | 6,146 | |||||
Cash and cash equivalents at end of year | $ | 24,104 | $ | 4,183 | |||
Cash paid for: | |||||||
Interest | $ | 1,234 | $ | 1,677 | |||
Income taxes | $ | 5,250 | $ | 6,649 | |||
Non cash investing activities: | |||||||
Fixed asset purchases in accounts payable | $ | 298 | $ | 868 | |||
Non cash financing activities: | |||||||
Deposit used in payment of principal on term loans | $ | — | $ | 1,200 | |||
Non-GAAP Financial Measures
This press release contains financial information determined by methods other than in accordance with accounting principles generally accepted in
Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA represents net income before, as applicable from time to time, (i) interest expense, net, (ii) provision (benefit) for income taxes, (iii) depreciation and amortization of long-lived assets, (iv) share based compensation expense, (v) plant closure costs, and (vi) nonrecurring legal settlement costs and associated legal expenses unrelated to the Company's core operations. Free Cash Flow represents net cash (used in) provided by operating activities less purchase of property, plant and equipment and net working capital. Return on capital employed represents earnings before (i) interest expense, net and (ii) provision (benefit) for income taxes divided by (i) stockholders' equity and (ii) current and long-term debt. These measures have limitations as analytical tools and should not be considered in isolation or as an alternative to performance measure derived in accordance with GAAP as an indicator of our operating performance. We present Adjusted EBITDA, Free Cash Flows, Debt to Trailing Twelve Months Adjusted EBITDA and Return on Capital Employed because management uses these measures as key performance indicators, and we believe that securities analysts, investors and others use these measures to evaluate companies in our industry. Our calculation of these measures may not be comparable to similarly named measures reported by other companies. The following tables present reconciliations of net income to Adjusted EBITDA, Cash Flow from Operating Activities to Free Cash Flow and Net Income per Share to Adjusted Net Income per Share, the most directly comparable GAAP measures, and Return on Capital Employed, for the periods presented:
Net Income to Adjusted EBITDA Reconciliation (unaudited, in thousands) | |||||||||||||||
Three months ended | Twelve Months Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
Net income | $ | 2,182 | $ | 4,832 | $ | 20,324 | $ | 12,203 | |||||||
Provision (benefit) for income taxes | 223 | (2,276 | ) | 5,422 | 2,382 | ||||||||||
Total other income and expenses(1) | 112 | 418 | 791 | 3,418 | |||||||||||
Depreciation and amortization | 3,315 | 2,457 | 12,831 | 11,603 | |||||||||||
Share-based compensation | 700 | 624 | 2,923 | 2,329 | |||||||||||
Adjusted EBITDA | $ | 6,532 | $ | 6,055 | $ | 42,291 | $ | 31,935 | |||||||
Adjusted EBITDA as a percent of net sales | 8.9 | % | 7.0 | % | 11.8 | % | 8.5 | % | |||||||
(1)Includes interest expense, loss due to extinguishment of debt and non-cash periodic post-retirement benefit cost |
Computation of Debt to Trailing Twelve Months Adjusted EBITDA (unaudited, in thousands) | ||
Trailing Twelve Month Adjusted EBITDA | ||
Net income | $ | 20,324 |
Provision for income taxes | 5,422 | |
Total other expenses(1) | 791 | |
Depreciation and amortization | 12,831 | |
Share-based compensation | 2,923 | |
Adjusted EBITDA | $ | 42,291 |
Total Outstanding Term Debt as of | $ | 22,987 |
Term debt to Trailing Twelve Months Adjusted EBITDA | 0.54 | |
(1)Includes interest expense and non-cash periodic post-retirement benefit cost |
Computation of Return on Capital Employed Fiscal Year Ended (unaudited, in thousands) | |||||||
2023 | 2022 | ||||||
Equity | $ | 138,953 | $ | 116,125 | |||
Structure debt | 22,987 | 26,058 | |||||
Total structured investment | $ | 161,940 | $ | 142,183 | |||
Operating income | $ | 26,537 | $ | 18,003 | |||
Return on capital employed | 16.4 | % | 12.7 | % |
Free Cash Flow Fiscal Year Ended (unaudited, in thousands) | |||||||
2023 | 2022 | ||||||
Cash flow provided by operations | $ | 34,842 | $ | 18,982 | |||
Purchase of property, plant and equipment | (9,100 | ) | (16,588 | ) | |||
Free cash flow surplus | $ | 25,742 | $ | 2,394 |
Adjusted Net Income per Share (unaudited, in thousands) | |||||||
Three Months Ended | |||||||
2023 | 2022 | ||||||
Net Income | $ | 2,182 | $ | 4,832 | |||
$ | — | $ | (2,363 | ) | |||
Adjusted net income | $ | 2,182 | $ | 2,469 | |||
Weighted average common shares outstanding - basic | 8,653,000 | 8,417,655 | |||||
Weighted average common and potentially issuable common shares outstanding- diluted | 8,878,000 | 8,497,028 | |||||
Net income per share - basic | $ | 0.25 | $ | 0.57 | |||
— | (0.28 | ) | |||||
Adjusted net income per share - basic | $ | 0.25 | $ | 0.29 | |||
Net income per share - diluted | $ | 0.25 | $ | 0.57 | |||
— | (0.28 | ) | |||||
Adjusted net income per share - diluted | $ | 0.25 | $ | 0.29 |
Source:
2024 GlobeNewswire, Inc., source