Stoneridge Reports Second-Quarter 2013 Results

Aug 01, 2013, 08:34 ET from Stoneridge, Inc.

WARREN, Ohio, Aug. 1, 2013 /PRNewswire/ -- 

  • Sequential Sales Growth Over the Last Three Quarters
  • Continued Improvement in Operating Margins and Earnings
  • Company Maintains 2013 Guidance of $0.75-$0.95 per Share
  • Lower Interest Expense from Deleveraging

Stoneridge, Inc. (NYSE: SRI) today announced financial results for the second quarter ended June 30, 2013.

Second-quarter 2013 net sales were $242.8 million, an increase of $8.5 million, or 3.6%, compared with $234.3 million for the second quarter of 2012. The increase in the current quarter's net sales was primarily due to higher sales in the Company's PST, Electronics and Control Devices business segments.

Net income for the second quarter of 2013 was $5.8 million, or $0.21 per diluted share, compared with a net loss of $3.6 million, or $(0.13) per diluted share, in the second quarter of 2012.  The increase in net income was primarily due to higher sales in the second quarter of 2013 compared with the same period in 2012 and continued improvement in PST's markets and operations in Brazil.

As of June 30, 2013, Stoneridge's consolidated cash position was $37.0 million, a decrease of $7.5 million from December 31, 2012, due primarily to increased receivables and inventories at PST resulting from the Brazilian market recovery.

John Corey, President and Chief Executive Officer, commented, "Year-over-year sales comparisons were higher in the second quarter and continued the sequential sales increases we have seen since the fourth quarter of 2012.  The higher sales are mostly the result of improved PST sales which continue to increase over the trough level experienced in the second quarter of 2012."

Corey further noted Company-wide cost reductions and other initiatives implemented during 2012 continued to improve operating margins.  PST margins improved as a result of previous cost actions and an improving sales mix driven largely by alarm systems in the aftermarket.

Corey continued, "While the commercial vehicle market demand remains less than robust, Stoneridge's participation in diversified markets has reduced this impact and improved our ability to generate operating profits with lower volumes.  In addition, even though the U.S. dollar has gained strength versus the Brazilian Real (BRL), we have been able to better manage our global foreign exchange exposure and have reduced PST's U.S. dollar denominated debt by $10.3 million since the start of 2013.  We have recorded a relatively minor currency impact in the second quarter of 2013 compared with the significant impact experienced in the second quarter of 2012."

Regarding the remaining quarters of 2013, Corey added, "We expect to see further financial improvement, continuing a trend that started in the third quarter of 2012.  We reaffirm our 2013 guidance of $0.75 to $0.95 per share as published on February 7, 2013, based on our expectation of continued market improvement and benefits from cost initiatives."

Conference Call on the Web A live Internet broadcast of Stoneridge's conference call regarding 2013 second-quarter results can be accessed at 11 a.m. Eastern time on Thursday, August 1, 2013, at www.stoneridge.com, which will also offer a webcast replay.

About Stoneridge, Inc. Stoneridge, Inc., headquartered in Warren, Ohio, is an independent designer and manufacturer of highly engineered electrical and electronic components, modules and systems principally for the commercial vehicle, automotive and agricultural, motorcycle and off-highway vehicle markets.  Additional information about Stoneridge can be found at www.stoneridge.com.

Forward-Looking Statements Statements in this release that are not historical fact are forward-looking statements, which involve risks and uncertainties that could cause actual events or results to differ materially from those expressed or implied in this release.  Things that may cause actual results to differ materially from those in the forward-looking statements include, among other factors, the loss of a major customer; a significant volume change in commercial vehicle, automotive, agricultural, motorcycle and off-highway vehicle production; disruption in the OEM supply chain due to bankruptcies; a significant change in general economic conditions in any of the various countries in which the Company operates; labor disruptions at the Company's facilities or at any of the Company's significant customers or suppliers; the ability of the Company's suppliers to supply the Company with parts and components at competitive prices on a timely basis; customer acceptance of new products; and the failure to achieve successful integration of any acquired company or business.  In addition, this release contains time-sensitive information that reflects management's best analysis only as of the date of this release.  The Company does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release.  Further information concerning issues that could materially affect financial performance related to forward-looking statements contained in this release can be found in the Company's periodic filings with the Securities and Exchange Commission.

 

 

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

(in thousands, except per share data)

2013

2012

2013

2012

Net sales

$     242,785

$     234,265

$     478,495

$     496,532

Costs and expenses:

Cost of goods sold

182,565

180,606

359,546

377,735

Selling, general and administrative

48,395

52,042

96,832

105,331

Operating Income

11,825

1,617

22,117

13,466

Interest expense, net

4,575

5,162

9,149

10,517

Equity in earnings of investees

(96)

(97)

(297)

(236)

Other expense (income), net

(170)

2,734

447

2,403

Income (loss) before income taxes

7,516

(6,182)

12,818

782

Provision (benefit) for income taxes

1,125

(884)

2,144

334

Net income (loss)

6,391

(5,298)

10,674

448

Net income (loss) attributable to noncontrolling interest

634

(1,740)

794

(1,873)

Net income (loss) attributable to Stoneridge, Inc.

$        5,757

$        (3,558)

$        9,880

$         2,321

Earnings per share attributable to Stoneridge, Inc.:

Basic

$          0.22

$          (0.13)

$          0.37

$           0.09

Diluted

$          0.21

$          (0.13)

$          0.36

$           0.09

Weighted average shares outstanding

Basic

26,692

26,424

26,649

26,322

Diluted

27,348

26,424

27,358

26,999

 

 

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

June 30,

December 31,

(in thousands)

2013

2012

(Unaudited)

ASSETS

Current assets:

Cash and cash equivalents

$           37,023

$             44,555

Accounts receivable, less reserves of $3,411 and $3,394, respectively

158,371

141,503

Inventories, net

109,812

96,032

Prepaid expenses and other current assets

30,293

28,964

Total current assets

335,499

311,054

Long-term assets:

Property, plant and equipment, net

112,236

119,147

Other assets

   Intangible assets, net

75,189

84,397

   Goodwill

61,578

66,381

   Investments and other long-term assets, net

9,904

11,712

Total long-term assets

258,907

281,637

Total assets

$        594,406

$           592,691

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Current portion of debt

$           10,858

$             18,925

Revolving credit facilities

-

1,160

Accounts payable

85,759

76,303

Accrued expenses and other current liabilities

60,345

57,081

Total current liabilities

156,962

153,469

Long-term liabilities:

Long-term debt, net

188,429

181,311

Deferred income taxes

56,554

59,819

Other long-term liabilities

4,369

4,258

Total long-term liabilities

249,352

245,388

Shareholders' equity:

Preferred Shares, without par value, authorized 5,000 shares, none issued

-

-

Common Shares, without par value, authorized 60,000 shares, issued 28,803 and 28,433    shares and outstanding 28,487 and 27,913 shares at June 30, 2013 and December 31, 2012,    respectively, with no stated value

 

 

-

 

-

Additional paid-in capital

185,498

184,822

Common Shares held in treasury, 316 and 520 shares at June 30, 2013 and December 31,     2012, respectively, at cost

(519)

(1,885)

Accumulated deficit

(13,022)

(22,902)

Accumulated other comprehensive loss

(25,074)

(10,282)

Total Stoneridge Inc. shareholders' equity

146,883

149,753

Noncontrolling interest

41,209

44,081

Total shareholders' equity

188,092

193,834

Total liabilities and shareholders' equity

$        594,406

$           592,691

 

 

 CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS 

 (Unaudited) 

Three months ended

Six months ended

June 30,

June 30,

 (in thousands) 

2013

2012

2013

2012

 Net income (loss) 

$            6,391

$           (5,298)

$         10,674

$              448

 Other comprehensive income (loss), net of tax: 

 Foreign currency translation adjustments 

(14,359)

(17,456)

(12,114)

(10,345)

 Unrealized gain (loss) on derivatives 

(2,937)

(1,771)

(2,678)

5,485

 Other comprehensive loss 

(17,296)

(19,227)

(14,792)

(4,860)

 Consolidated comprehensive loss 

(10,905)

(24,525)

(4,118)

(4,412)

 Income (loss) attributable to noncontrolling interest 

634

(1,740)

794

(1,873)

 Comprehensive loss attributable to Stoneridge, Inc. 

$        (11,539)

$         (22,785)

$         (4,912)

$         (2,539)

 

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Six months ended June 30 (in thousands)

2013

2012

OPERATING ACTIVITIES:

          Net cash provided by operating activities

$            3,243

$           15,316

INVESTING ACTIVITIES:

Capital expenditures

(10,701)

(14,370)

Proceeds from sale of fixed assets

83

301

Payment for additional interest in PST

-

(19,779)

          Net cash used for investing activities

(10,618)

(33,848)

FINANCING ACTIVITIES:

Revolving credit facility borrowings

-

11,310

Revolving credit facility payments

(1,160)

(24,426)

Proceeds from issuance of other debt

19,234

18,871

Repayments of other debt

(16,953)

(26,124)

Other financing costs

-

(111)

Repurchase of Common Shares to satisfy employee tax withholding

(670)

(1,119)

          Net cash provided by (used for) financing activities

451

(21,599)

Effect of exchange rate changes on cash and cash equivalents

(608)

564

Net change in cash and cash equivalents

(7,532)

(39,567)

Cash and cash equivalents at beginning of period

44,555

78,731

Cash and cash equivalents at end of period

$         37,023

$           39,164

Supplemental disclosure of non-cash financing activities:

Change in fair value of interest rate swap

$          (1,394)

$                754

Issuance of Common Shares for acquisition of additional PST interest

$                    -

$           10,197

                                                  

 

SOURCE Stoneridge, Inc.



RELATED LINKS

http://www.stoneridge.com