Synalloy Reports Second Quarter 2020 Results
During the second quarter of 2020, the Company realized operating losses of
Net sales for the second quarter of 2020 totaled
For the second quarter of 2020, the Company recorded a net loss of
For the first six months of 2020, net loss was
The Company also reports its performance utilizing two non-GAAP financial measures: Adjusted Net (Loss) Income and Adjusted EBITDA. The Company's performance, as calculated under the two measures, is as follows:
-
Adjusted Net Loss for the second quarter of 2020 was
$1.1 million , or$0.11 adjusted diluted loss per share compared to an Adjusted Net Loss of$0.3 million , or$0.04 adjusted diluted loss per share for the second quarter of 2019. For the first six months of 2020, Adjusted Net Loss was$1.8 million , or$0.19 adjusted diluted loss per share, compared to Adjusted Net Income of$0.3 million , or$0.04 adjusted diluted earnings per share for the first six months of 2019. -
Adjusted EBITDA decreased
$1.5 million for the second quarter of 2020 to$1.9 million (2.9% of sales), from$3.4 million (4.3% of sales) for the second quarter of 2019. For the first six months of 2020, Adjusted EBITDA was$4.6 million (3.3% of sales), compared to$8.2 million (5.0% of sales) for the first six months of 2019.
Both the Adjusted Net Income and Adjusted EBITDA metrics include an add-back of the
The Company's results are periodically impacted by factors that are not included as adjustments to our non-GAAP measures, but which represent items that help explain differences in period to period results. As mentioned above, the second quarter of 2020 was negatively impacted by inventory price change losses which, on a pre-tax basis, totaled
Additionally, during the second quarter, other significant items occurred with a pre-tax impact of
-
Mark-to-market valuation gains on investments in equity securities totaling
$1.1 million ; -
Settlement of the insurance claim associated with the heavy wall press outage resulted in proceeds and related gain of
$1.0 million .
"The cost cutting initiatives implemented at the start of this year continued to build momentum in the second quarter. On a sequential basis, Adjusted EBITDA for the operating units, other than Palmer, totaled
Metals Segment
The Metals Segment's net sales for the second quarter of 2020 totaled
Pounds of heavy wall seamless carbon pipe and tube were down 4.0% from last year’s second quarter, primarily in the oil and gas sector. Average selling prices were down 12.0%. On a sequential quarterly basis, pounds shipped for this product category were down 19.0% in the second quarter of this year as compared with the first quarter of this year, while average selling prices declined by 4.7%.
Pounds shipped of commodity welded pipe and tube in the second quarter of this year were up 0.6% over the second quarter of last year, while average selling prices declined by 1.9% despite a richer mix of alloys and projects. On a sequential quarterly basis, pounds shipped in the second quarter were down 8.1% from the first quarter of this year and average selling prices declined 1.9%. Shipments of polished ornamental pipe and tube in the second quarter of this year were down 16.5% from the same period last year, with average selling prices up by 2.5%. Sequentially, shipments in the second quarter of this year were down 2.4% from the first quarter of this year, while average selling prices declined by 2.1%, primarily related to declines in the automotive and consumer discretionary markets offset by increases in COVID-19 related medical equipment.
The backlog for our subsidiary,
The Metals Segment's reported operating losses of
Current quarter operating results were affected by nickel prices and resulting surcharges for 304 and 316 alloys. The second quarter of 2020 proved to be a much more unfavorable environment than the second quarter of 2019, with net metal pricing losses of
Specialty Chemicals Segment
Net sales for the Specialty Chemicals Segment in the second quarter of 2020 totaled
Companies in the specialty chemical space are facing a significant downturn in demand for specialty chemicals. Weak industrial and manufacturing activities due to the COVID-19 lock-down restrictions and disruptions in supply chains have affected demand in
Operating income for the Specialty Chemicals Segment for the second quarter of 2020 was
Other Items
Unallocated corporate expenses for the second quarter of 2020 decreased
Interest expense was
The effective tax rate was 23.6% and 14.4% for the three months ended
The effective tax rate was 30.4% and 23.6% for the six-month periods ended
The Company's cash balance increased
a) |
Net inventories decreased |
|
b) |
Accounts payable increased |
|
c) |
Net accounts receivable increased |
|
d) |
Capital expenditures for the first six months of 2020 were |
|
e) |
The Company paid |
The Company had
Pursuant to the Credit Agreement, the Company is subject to certain covenants including maintaining a minimum fixed charge coverage ratio of not less than 1.25, maintaining a minimum tangible net worth of not less than
The Company notified its bank of a technical default of the fixed charge coverage ratio in its Credit Agreement at the quarter ended
At
Outlook
The manufacturing sector will continue to face challenges over the next several quarters. As a result of the uncertainty related to the COVID-19 pandemic, we have suspended all Fiscal 2020 guidance and are not providing guidance at this time. With a restart of the economy pending, we cannot predict the impact on our various businesses. We remain diligent and thoughtful in managing profitability and liquidity while navigating these unprecedented times and continuing to execute our strategy.
Forward-Looking Statements
This earnings release includes and incorporates by reference "forward-looking statements" within the meaning of the federal securities laws. All statements that are not historical facts are "forward-looking statements." The words "estimate," "project," "intend," "expect," "believe," "should," "anticipate," "hope," "optimistic," "plan," "outlook," "should," "could," "may" and similar expressions identify forward-looking statements. The forward-looking statements are subject to certain risks and uncertainties, including without limitation those identified below, which could cause actual results to differ materially from historical results or those anticipated. Readers are cautioned not to place undue reliance on these forward-looking statements. The following factors could cause actual results to differ materially from historical results or those anticipated: adverse economic conditions; the impact of competitive products and pricing; product demand and acceptance risks; raw material and other increased costs; raw materials availability; employee relations; ability to maintain workforce by hiring trained employees; labor efficiencies; customer delays or difficulties in the production of products; new fracking regulations; a prolonged decrease in nickel and oil prices; unforeseen delays in completing the integrations of acquisitions; risks associated with mergers, acquisitions, dispositions and other expansion activities; financial stability of our customers; environmental issues; negative or unexpected results from tax law changes; unavailability of debt financing on acceptable terms and exposure to increased market interest rate risk; inability to comply with covenants and ratios required by our debt financing arrangements; ability to weather an economic downturn; loss of consumer or investor confidence, risks relating to the impact and spread of COVID-19 and other risks detailed from time-to-time in the Company's
Non-GAAP Financial Information
Financial statement information included in this earnings release includes non-GAAP (Generally Accepted Accounting Principles) measures and should be read along with the accompanying tables which provide a reconciliation of non-GAAP measures to GAAP measures.
Adjusted Net (Loss) Income and Adjusted Diluted (Loss) Earnings per Share are non-GAAP measures and exclude discontinued operations, goodwill impairment, asset impairment, stock option / grant costs, non-cash lease costs, acquisition costs, proxy contest costs, shelf registration costs, earn-out adjustments, gain on excess death benefit, realized and unrealized (gains) and losses on investments in equity securities, casualty insurance gain, all (gains) losses associated with a Sale-Leaseback, and retention costs from net income. They also utilize a constant effective tax rate to reflect tax neutral results.
Adjusted EBITDA is a non-GAAP measure and excludes discontinued operations, goodwill impairment, asset impairment, interest expense (including change in fair value of interest rate swap), income taxes, depreciation, amortization, stock option / grant costs, non-cash lease cost, acquisition costs, proxy contest costs, shelf registration costs, earn-out adjustments, gain on excess death benefit, realized and unrealized (gains) and losses on investments in equity securities, casualty insurance gain, all (gains) losses associated with a Sale-Leaseback and retention costs from net income.
Management believes that these non-GAAP measures provide additional useful information to allow readers to compare the financial results between periods. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP.
Synalloy Corporation Comparative Analysis |
||||||||||||||||
Condensed Consolidated Statement of Operations |
||||||||||||||||
|
||||||||||||||||
(Amounts in thousands, except per share data) |
Three Months Ended
|
|
Six Months Ended
|
|||||||||||||
(unaudited) |
2020 |
|
2019 |
|
2020 |
|
2019 |
|||||||||
Net sales |
|
|
|
|
|
|
|
|||||||||
Metals Segment |
$ |
52,018 |
|
|
$ |
64,503 |
|
|
$ |
112,681 |
|
|
$ |
135,607 |
|
|
Specialty Chemicals Segment |
14,118 |
|
|
14,275 |
|
|
28,152 |
|
|
27,975 |
|
|||||
|
$ |
66,136 |
|
|
$ |
78,778 |
|
|
$ |
140,833 |
|
|
$ |
163,582 |
|
|
Operating (loss) income |
|
|
|
|
|
|
||||||||||
Metals Segment |
$ |
(9,155 |
) |
|
$ |
1,193 |
|
|
$ |
(8,221 |
) |
|
$ |
2,675 |
|
|
Specialty Chemicals Segment |
1,980 |
|
|
926 |
|
|
2,447 |
|
|
1,540 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Unallocated expense (income) |
|
|
|
|
|
|
|
|||||||||
Corporate |
1,586 |
|
|
1,944 |
|
|
3,607 |
|
|
4,251 |
|
|||||
Acquisition costs and other |
6 |
|
|
20 |
|
|
135 |
|
|
348 |
|
|||||
Proxy contest costs |
2,734 |
|
|
— |
|
|
2,909 |
|
|
— |
|
|||||
Earn-out adjustments |
(827 |
) |
|
(418 |
) |
|
(823 |
) |
|
(401 |
) |
|||||
Operating (loss) income |
(10,674 |
) |
|
573 |
|
|
(11,602 |
) |
|
17 |
|
|||||
Interest expense |
532 |
|
|
1,010 |
|
|
1,251 |
|
|
2,034 |
|
|||||
Change in fair value of interest rate swap |
(4 |
) |
|
77 |
|
|
81 |
|
|
124 |
|
|||||
Other (income) expense, net |
(2,129 |
) |
|
(110 |
) |
|
(1,303 |
) |
|
(404 |
) |
|||||
Net loss before income taxes |
(9,073 |
) |
|
(404 |
) |
|
(11,631 |
) |
|
(1,737 |
) |
|||||
Income tax (benefit) |
(2,116 |
) |
|
(142 |
) |
|
(3,496 |
) |
|
(548 |
) |
|||||
|
|
|
|
|
|
|
|
|||||||||
Net loss |
$ |
(6,957 |
) |
|
$ |
(262 |
) |
|
$ |
(8,135 |
) |
|
$ |
(1,189 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Net loss per common share |
|
|
|
|
|
|
|
|||||||||
Basic |
$ |
(0.77 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.90 |
) |
|
$ |
(0.13 |
) |
|
Diluted |
$ |
(0.77 |
) |
|
$ |
(0.03 |
) |
|
$ |
(0.90 |
) |
|
$ |
(0.13 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Average shares outstanding |
|
|
|
|
|
|
|
|||||||||
Basic |
9,058 |
|
|
8,974 |
|
|
9,066 |
|
|
8,951 |
|
|||||
Diluted |
9,058 |
|
|
8,974 |
|
|
9,066 |
|
|
8,951 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Other data: |
|
|
|
|
|
|
|
|||||||||
Adjusted EBITDA (1) |
1,947 |
|
|
3,408 |
|
|
4,587 |
|
|
8,175 |
|
(1) The term Adjusted EBITDA is a non-GAAP financial measure that the Company believes is useful to investors in evaluating its results to determine the value of a company. An item is included in the measure if its periodic value is inconsistent and sufficiently material that not identifying the item would render period comparability less meaningful to the reader or if including the item provides a clearer representation of normalized periodic earnings. The Company includes in Adjusted EBITDA two categories of items: 1) Base EBITDA components, including: earnings before discontinued operations, interest (including change in fair value of interest rate swap), income taxes, depreciation and amortization, and 2) Material transaction costs including: goodwill impairment, asset impairment, acquisition costs, proxy contest costs, shelf registration costs, earn-out adjustments, gain on excess death benefit, realized and unrealized (gains) and losses on investments in equity securities, casualty insurance gains, all (gains) losses associated with Sale-leaseback, stock option/grant costs, non-cash lease cost, and retention costs from net income. For a reconciliation of this non-GAAP measure to the most comparable GAAP equivalent, refer to the Reconciliation of Net Income to Adjusted EBITDA as shown on next page. |
Reconciliation of Net (Loss) to Adjusted EBITDA |
||||||||||||||||
($ in thousands) |
Three Months Ended
|
|
Six Months Ended
|
|||||||||||||
(unaudited) |
2020 |
|
2019 |
|
2020 |
|
2019 |
|||||||||
Consolidated |
|
|
|
|
|
|
|
|||||||||
Net loss |
$ |
(6,957 |
) |
|
$ |
(262 |
) |
|
$ |
(8,135 |
) |
|
$ |
(1,189 |
) |
|
Adjustments: |
|
|
|
|
|
|
|
|||||||||
Interest expense |
532 |
|
|
1,010 |
|
|
1,251 |
|
|
2,034 |
|
|||||
Change in fair value of interest rate swap |
(4 |
) |
|
77 |
|
|
81 |
|
|
124 |
|
|||||
Income taxes |
(2,116 |
) |
|
(142 |
) |
|
(3,496 |
) |
|
(548 |
) |
|||||
Depreciation |
1,989 |
|
|
1,943 |
|
|
3,947 |
|
|
3,832 |
|
|||||
Amortization |
810 |
|
|
819 |
|
|
1,619 |
|
|
1,743 |
|
|||||
EBITDA |
(5,746 |
) |
|
3,445 |
|
|
(4,733 |
) |
|
5,996 |
|
|||||
Acquisition costs and other |
6 |
|
|
32 |
|
|
138 |
|
|
1,672 |
|
|||||
Proxy contest costs |
2,734 |
|
|
— |
|
|
2,909 |
|
|
— |
|
|||||
Shelf registration costs |
— |
|
|
10 |
|
|
— |
|
|
10 |
|
|||||
Earn-out adjustments |
(827 |
) |
|
(418 |
) |
|
(823 |
) |
|
(401 |
) |
|||||
Gain on investments in equity securities |
(1,092 |
) |
|
(100 |
) |
|
(240 |
) |
|
(373 |
) |
|||||
Asset impairments |
6,079 |
|
|
— |
|
|
6,079 |
|
|
— |
|
|||||
Stock-based compensation |
430 |
|
|
237 |
|
|
766 |
|
|
853 |
|
|||||
Non-cash lease expense |
128 |
|
|
151 |
|
|
256 |
|
|
288 |
|
|||||
Retention expense |
235 |
|
|
51 |
|
|
235 |
|
|
130 |
|
|||||
Adjusted EBITDA |
$ |
1,947 |
|
|
$ |
3,408 |
|
|
$ |
4,587 |
|
|
$ |
8,175 |
|
|
% sales |
2.9 |
% |
|
4.3 |
% |
|
3.3 |
% |
|
5.0 |
% |
|||||
|
|
|
|
|
|
|
|
|||||||||
Other (unfavorable) favorable impacts to income (1): |
|
|
|
|
|
|
|
|||||||||
Inventory price change loss |
$ |
(3,511 |
) |
|
$ |
(1,788 |
) |
|
$ |
(3,936 |
) |
|
$ |
(5,164 |
) |
|
Inventory cost adjustments |
— |
|
|
39 |
|
|
70 |
|
|
150 |
|
|||||
Aged inventory adjustment |
43 |
|
|
24 |
|
|
84 |
|
|
8 |
|
|||||
Manufacturing variances |
(410 |
) |
|
519 |
|
|
(1,054 |
) |
|
24 |
|
|||||
Total other (unfavorable) favorable impacts |
$ |
(3,878 |
) |
|
$ |
(1,206 |
) |
|
$ |
(4,836 |
) |
|
$ |
(4,982 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Metals Segment |
|
|
|
|
|
|
|
|||||||||
Net (loss) income |
$ |
(7,308 |
) |
|
$ |
1,587 |
|
|
$ |
(6,381 |
) |
|
$ |
2,986 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|||||||||
Interest expense |
7 |
|
|
23 |
|
|
11 |
|
|
44 |
|
|||||
Depreciation expense |
1,559 |
|
|
1,533 |
|
|
3,070 |
|
|
3,014 |
|
|||||
Amortization expense |
810 |
|
|
819 |
|
|
1,619 |
|
|
1,743 |
|
|||||
EBITDA |
(4,932 |
) |
|
3,962 |
|
|
(1,681 |
) |
|
7,787 |
|
|||||
Acquisition costs and other |
— |
|
|
12 |
|
|
3 |
|
|
1,370 |
|
|||||
Earn-out adjustments |
(827 |
) |
|
(418 |
) |
|
(823 |
) |
|
(401 |
) |
|||||
Asset impairment |
6,079 |
|
|
— |
|
|
6,079 |
|
|
— |
|
|||||
Stock-based compensation |
130 |
|
|
63 |
|
|
171 |
|
|
210 |
|
|||||
Retention expense |
— |
|
|
26 |
|
|
— |
|
|
80 |
|
|||||
Metals Segment Adjusted EBITDA |
$ |
450 |
|
|
$ |
3,645 |
|
|
$ |
3,749 |
|
|
$ |
9,046 |
|
|
% segment sales |
0.9 |
% |
|
5.7 |
% |
|
3.3 |
% |
|
6.7 |
% |
|||||
|
|
|
|
|
|
|
|
|||||||||
Other (unfavorable) favorable impacts to income (1): |
|
|
|
|
|
|
|
|||||||||
Inventory price change loss |
$ |
(3,511 |
) |
|
$ |
(1,788 |
) |
|
$ |
(3,936 |
) |
|
$ |
(5,164 |
) |
|
Inventory cost adjustments |
— |
|
|
39 |
|
|
100 |
|
|
135 |
|
|||||
Aged inventory adjustment |
48 |
|
|
34 |
|
|
89 |
|
|
17 |
|
|||||
Manufacturing variances |
(427 |
) |
|
513 |
|
|
(905 |
) |
|
207 |
|
|||||
Total other (unfavorable) favorable impacts |
$ |
(3,890 |
) |
|
$ |
(1,202 |
) |
|
$ |
(4,652 |
) |
|
$ |
(4,805 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Specialty Chemicals Segment |
|
|
|
|
|
|
|
|||||||||
Net income |
$ |
1,980 |
|
|
$ |
926 |
|
|
$ |
2,460 |
|
|
$ |
1,539 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|||||||||
Interest expense |
1 |
|
|
— |
|
|
9 |
|
|
1 |
|
|||||
Depreciation expense |
389 |
|
|
370 |
|
|
792 |
|
|
739 |
|
|||||
EBITDA |
2,370 |
|
|
1,296 |
|
|
3,261 |
|
|
2,279 |
|
|||||
Stock-based compensation |
80 |
|
|
26 |
|
|
118 |
|
|
96 |
|
|||||
Specialty Chemicals Segment Adjusted EBITDA |
$ |
2,450 |
|
|
$ |
1,322 |
|
|
$ |
3,379 |
|
|
$ |
2,375 |
|
|
% segment sales |
17.4 |
% |
|
9.3 |
% |
|
12.0 |
% |
|
8.5 |
% |
|||||
|
|
|
|
|
|
|
|
|||||||||
Other (unfavorable) favorable impacts to income (1): |
|
|
|
|
|
|
|
|||||||||
Inventory cost adjustments |
— |
|
|
— |
|
|
(30 |
) |
|
15 |
|
|||||
Aged inventory adjustment |
(5 |
) |
|
(10 |
) |
|
(5 |
) |
|
(9 |
) |
|||||
Manufacturing variances |
17 |
|
|
7 |
|
|
(149 |
) |
|
(183 |
) |
|||||
Total other (unfavorable) favorable impacts |
$ |
12 |
|
|
$ |
(3 |
) |
|
$ |
(184 |
) |
|
$ |
(177 |
) |
(1) Other favorable (unfavorable) impacts to income - listed to provide investors with insight into financial impacts, that cannot be included in the Non-GAAP measure Adjusted EBITDA, but management believes can provide insight into underlying operational earnings associated with the respective period's activity level. The items include a) inventory price change - the calculated value that profits improved (declined) due to the increase (decrease) in metal and alloy pricing indices during the period, and b)inventory valuation adjustments - value of periodic adjustment to inventory carrying value unrelated to periodic earnings including i) reserve for lower of cost or net realizable value, ii) reserve for aged inventory and iii) manufacturing variances - the calculated value of manufacturing absorption deferred into inventory to be amortized in a later period, rather than being shown in the period that created the benefit or cost. |
Reconciliation of (Loss) and (Loss) Earnings Per Share to |
||||||||||||||||
Adjusted Net (Loss) Income and Adjusted (Loss) Earnings Per Share |
||||||||||||||||
(Amounts in thousands, except per share data) |
Three Months Ended
|
|
Six Months Ended
|
|||||||||||||
(unaudited) |
2020 |
|
2019 |
|
2020 |
|
2019 |
|||||||||
|
|
|
|
|
|
|
|
|||||||||
Loss before taxes |
$ |
(9,073 |
) |
|
$ |
(404 |
) |
|
$ |
(11,631 |
) |
|
$ |
(1,737 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Adjustments: |
|
|
|
|
|
|
|
|||||||||
Acquisition costs and other |
6 |
|
|
32 |
|
|
138 |
|
|
1,672 |
|
|||||
Proxy contest costs |
2,734 |
|
|
— |
|
|
2,909 |
|
|
— |
|
|||||
Shelf registration costs |
— |
|
|
10 |
|
|
— |
|
|
10 |
|
|||||
Earn-out adjustments |
(827 |
) |
|
(418 |
) |
|
(823 |
) |
|
(401 |
) |
|||||
Gain on investments in equity securities |
(1,092 |
) |
|
(100 |
) |
|
(240 |
) |
|
(373 |
) |
|||||
Asset impairments |
6,079 |
|
|
— |
|
|
6,079 |
|
|
— |
|
|||||
Stock-based compensation |
430 |
|
|
237 |
|
|
766 |
|
|
853 |
|
|||||
Non-cash lease expense |
128 |
|
|
151 |
|
|
256 |
|
|
288 |
|
|||||
Retention expense |
235 |
|
|
51 |
|
|
235 |
|
|
130 |
|
|||||
Adjusted (loss) income before income taxes |
(1,380 |
) |
|
(441 |
) |
|
(2,311 |
) |
|
442 |
|
|||||
(Benefit) provision for income taxes at 21% |
(290 |
) |
|
(93 |
) |
|
(485 |
) |
|
93 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted net (loss) income |
$ |
(1,090 |
) |
|
$ |
(348 |
) |
|
$ |
(1,826 |
) |
|
$ |
349 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Average shares outstanding, as reported |
|
|
|
|
|
|
|
|||||||||
Basic |
9,058 |
|
|
8,974 |
|
|
9,066 |
|
|
8,951 |
|
|||||
Diluted |
9,058 |
|
|
8,974 |
|
|
9,066 |
|
|
8,951 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted net (loss) income per common share |
|
|
|
|
|
|
|
|||||||||
Basic |
$ |
(0.12 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.20 |
) |
|
$ |
0.04 |
|
|
Diluted |
$ |
(0.12 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.20 |
) |
|
$ |
0.04 |
|
|
|
|
|
|
|
|
|
|
|||||||||
Other (unfavorable) favorable impacts to income (1): |
|
|
|
|
|
|
||||||||||
Inventory price change loss |
$ |
(3,511 |
) |
|
$ |
(1,788 |
) |
|
$ |
(3,936 |
) |
|
$ |
(5,164 |
) |
|
Inventory cost adjustment |
— |
|
|
39 |
|
|
70 |
|
|
150 |
|
|||||
Aged inventory adjustment |
43 |
|
|
24 |
|
|
84 |
|
|
8 |
|
|||||
Manufacturing variance |
(410 |
) |
|
519 |
|
|
(1,054 |
) |
|
24 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Total other (unfavorable) favorable impacts |
$ |
(3,878 |
) |
|
$ |
(1,206 |
) |
|
$ |
(4,836 |
) |
|
$ |
(4,982 |
) |
|
Other impacts, net of tax |
$ |
(3,064 |
) |
|
$ |
(953 |
) |
|
$ |
(3,820 |
) |
|
$ |
(3,936 |
) |
(1) Other (unfavorable) impacts to income - listed to provide investors with insight into financial impacts, that cannot be included in the Non-GAAP measure Adjusted Net Income, but management believes can provide insight into underlying operational earnings associated with the respective period's activity level. The items include a) inventory price change - the calculated value that profits improved (declined) due to the increase (decrease) in metal and alloy pricing indices during the period, and b)inventory valuation adjustments - value of periodic adjustment to inventory carrying value unrelated to periodic earnings including i) reserve for lower of cost or net realizable value, ii) reserve for aged inventory and iii) manufacturing variances - the calculated value of manufacturing absorption deferred into inventory to be amortized in a later period, rather than being shown in the period that created the benefit or cost. |
Condensed Consolidated Balance Sheets |
||||||||
|
(Unaudited) |
|
|
|||||
($ in thousands) |
|
|
|
|||||
Assets |
|
|
|
|||||
Cash |
$ |
1,412 |
|
|
$ |
626 |
|
|
Accounts receivable, net of allowance for credit losses of |
36,226 |
|
|
35,074 |
|
|||
Inventories, net |
95,331 |
|
|
98,186 |
|
|||
Prepaid expenses and other current assets |
14,718 |
|
|
13,229 |
|
|||
Total current assets |
147,687 |
|
|
147,115 |
|
|||
|
|
|
|
|||||
Property, plant and equipment, net |
37,359 |
|
|
40,690 |
|
|||
Right-of-use assets, operating leases, net |
35,717 |
|
|
35,772 |
|
|||
|
17,558 |
|
|
17,558 |
|
|||
Intangible assets, net |
12,835 |
|
|
15,714 |
|
|||
Deferred charges, net |
268 |
|
|
348 |
|
|||
Total assets |
$ |
251,424 |
|
|
$ |
257,197 |
|
|
|
|
|
|
|||||
Liabilities and Shareholders' Equity |
|
|
|
|||||
Accounts payable |
$ |
24,844 |
|
|
$ |
21,150 |
|
|
Accrued expenses and other current liabilities |
10,243 |
|
|
11,613 |
|
|||
Current portion of long-term debt |
4,000 |
|
|
4,000 |
|
|||
Current portion operating lease liabilities |
991 |
|
|
3,562 |
|
|||
Current portion of finance lease liabilities |
31 |
|
|
253 |
|
|||
Total current liabilities |
40,109 |
|
|
40,578 |
|
|||
|
|
|
|
|||||
Long-term debt |
74,635 |
|
|
71,554 |
|
|||
Long-term portion of earn-out liability |
1,642 |
|
|
3,578 |
|
|||
Deferred income taxes |
333 |
|
|
790 |
|
|||
Long-term portion of operating lease liabilities |
36,510 |
|
|
33,723 |
|
|||
Long-term portion of finance lease liabilities |
44 |
|
|
336 |
|
|||
Other long-term liabilities |
94 |
|
|
127 |
|
|||
Shareholders' equity |
98,057 |
|
|
106,511 |
|
|||
Total liabilities and shareholders' equity |
$ |
251,424 |
|
|
$ |
257,197 |
|
Note: The condensed consolidated balance sheet at |
View source version on businesswire.com: https://www.businesswire.com/news/home/20200903005253/en/
Source: