Hayes Lemmerz Reports 11.4% Sales Increase for Fiscal First Quarter and Stronger Earnings from Operations
07 June 2007 - 11:00PM
PR Newswire (US)
NORTHVILLE, Mich., June 7 /PRNewswire-FirstCall/ -- Hayes Lemmerz
International, Inc. (NASDAQ:HAYZ) today reported that sales for the
fiscal first quarter ended April 30, 2007 were $561.0 million, up
11.4% from $503.5 million in the year earlier quarter. The sales
increase came from strong international steel and aluminum wheel
sales, metals cost recovery and favorable currency fluctuations,
the Company said. Sales increased despite a reduction in U.S. sales
volumes of $27 million, due primarily to closure of a wheel plant
and lower components volume, the Company said. For the fiscal first
quarter, the Company reported Adjusted EBITDA of $54.6 million, up
$9.2 million from $45.4 million a year earlier and earnings from
operations of $20.1 million, up from the $7.4 million a year
earlier. The Company reported a loss from continuing operations of
$10.8 million, improved from a loss of $17.1 million in the year
earlier quarter. The Company also reported a $4.5 million loss from
discontinued operations compared to a loss of $0.5 million a year
earlier, resulting in a net loss of $15.3 million, compared with a
year earlier loss of $17.6 million. Free cash flow for the first
quarter, excluding the effects of the Company's accounts
receivables securitization program, was negative $5.0 million,
compared to positive $12.1 million in the first quarter of fiscal
2006, which included a one-time customer terms adjustment. "We
continue to reap benefits from our international expansion and our
relentless focus on improving operational efficiency," said Curtis
Clawson, President, Chief Executive Officer and Chairman of the
Board. "Our wheel volumes were up approximately 16% in low cost
regions. Earnings from operations increased significantly compared
with 2006 and operating margins continue to improve. I am happy
about these results especially in the face of an 8% decrease in
North American production by the Domestic Big Three automakers," he
said. On May 30, the Company announced that it had successfully
completed recapitalization transactions that included a $180
million equity rights offering and a direct investment by Deutsche
Bank Securities, Inc. of $13.1 million, approximately $495 million
of senior secured debt issued by a European subsidiary and 8 1/4%
senior notes due 2015 of ?130 million, also issued by a European
subsidiary. The recapitalization is expected to reduce interest
cost by approximately $15 million in 2007 and by $24 million
annually; for fiscal 2006, the Company's total interest cost was
$76.2 million. "Our excellent operational progress contributed
significantly to the success of our recent refinancing, which
raised new equity, retired high cost debt, reduced our leverage,
strengthened our balance sheet and improved liquidity by $80
million," Mr. Clawson said. "We were happy to see high demand for
the bond and bank debt, and oversubscription of the equity rights
offering." The Company also announced today that it is reaffirming
its earnings guidance for the full fiscal year 2007 that was
updated on May 15, 2007. The Company expects revenue of
approximately $2.2 billion for the full fiscal year ending January
31, 2008. Adjusted EBITDA is expected to be in the range of $200
million to $210 million. The Company expects positive free cash
flow (excluding securitization impact). Capital expenditures for
the year are expected to be approximately $90 to $95 million. Use
of Non-GAAP Financial Information EBITDA, a measure used by
management to measure operating performance, is defined as earnings
from operations plus depreciation and amortization. Adjusted EBITDA
is defined as EBITDA further adjusted to exclude asset impairment
losses and other restructuring charges, reorganization items and
other items. Management references these non-GAAP financial
measures frequently in its decision making because they provide
supplemental information that facilitates internal comparisons to
historical operating performance of prior periods and external
comparisons to competitors' historical operating performance.
Institutional investors generally look to Adjusted EBITDA in
measuring performance, among other things. The Company uses
Adjusted EBITDA to facilitate quantification of planned business
activities and enhance subsequent follow-up with comparisons of
actual to planned Adjusted EBITDA. In addition, incentive
compensation for management is based on Adjusted EBITDA. Free cash
flow is defined as cash from operating activities minus capital
expenditures plus cash from discontinued operations and the sale of
assets. Management uses free cash flow to identify the amount of
cash available to meet debt amortization requirements, pay
dividends to stockholders or make corporate investments. Conference
Call Hayes Lemmerz International, Inc. will host a telephone
conference call, today, Thursday, June 7, 2007, at 10:00 a.m. (ET),
to discuss the Company's fiscal year 2007 first quarter financial
results. To participate by phone, please dial 10 minutes prior to
the call: (888) 295-5935 from the United States and Canada or (706)
758-0212 from outside the United States. Callers should ask to be
connected to Hayes Lemmerz earnings conference call, Conference ID#
8999477. The conference call will be accompanied by a slide
presentation, which can be accessed this morning through the
Company's web site, in the Investor Kit presentations section at
http://www.hayes-lemmerz.com/Investor_Kit/Overview/Presentations/www-
presentations.html. (Due to the length of this URL, it may be
necessary to copy and paste this hyperlink into your Internet
browser's URL address field. Remove the space if one exists.) A
replay of the call will be available today, June 7, 2007, from 1:00
p.m. (ET) until 11:59 p.m. (ET), June 17, 2007, by calling (800)
642-1687 (within the United States and Canada) or (706) 645-9291
(for international calls). Please refer to Conference ID#8999477.
An audio replay of the call is expected to be available on the
Company's website beginning 48 hours after completion of the call.
Hayes Lemmerz International, Inc. is a world leading global
supplier of automotive and commercial highway wheels, brakes and
powertrain components. The Company has 30 facilities and
approximately 8,500 employees worldwide. Forward Looking Statements
This press release contains forward-looking statements with respect
to our financial condition and business. All statements other than
statements of historical fact made in this press release are
forward-looking. Such forward- looking statements include, among
others, those statements including the words "expect,"
"anticipate," "intend," believe," and similar language. These
forward-looking statements involve certain risks and uncertainties.
Our actual results may differ significantly from those projected in
the forward- looking statements. Factors that may cause actual
results to differ materially from those contemplated by such
forward-looking statements include, among others: (1) competitive
pressure in our industry; (2) fluctuations in the price of steel,
aluminum, and other raw materials; (3) changes in general economic
conditions; (4) our dependence on the automotive industry (which
has historically been cyclical) and on a small number of major
customers for the majority of our sales; (5) pricing pressure from
automotive industry customers and the potential for re-sourcing of
business to lower-cost providers; (6) changes in the financial
markets or our debt ratings affecting our financial structure and
our cost of capital and borrowed money; (7) the uncertainties
inherent in international operations and foreign currency
fluctuations; (8) our ability to divest non-core assets and
businesses; and (9) the risks described in our most recent Annual
Report on Form 10-K and our periodic statements filed with the
Securities and Exchange Commission. You are cautioned not to place
undue reliance on the forward-looking statements, which speak only
as of the date of this press release. HAYES LEMMERZ INTERNATIONAL,
INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Millions of
dollars) (Unaudited) April 30, January 31, 2007 2007 ASSETS Total
current assets 637.7 580.6 Property, and plant equipment, net 695.4
680.7 Goodwill, intangibles and other long term assets 435.5 429.9
Total assets $1,768.6 $1,691.2 LIABILITIES AND STOCKHOLDERS' EQUITY
Total current liabilities 483.7 438.9 Long-term debt, net of
current portion 663.3 659.4 Pension and other long-term liabilities
435.9 433.8 Minority interest 55.3 57.3 Total stockholders' equity
130.4 101.8 Total liabilities and stockholders' equity $1,768.6
$1,691.2 HAYES LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Millions of dollars)
(Unaudited) Three Months Three Months Ended Ended April 30, 2007
April 30, 2006 Net sales $561.0 $503.5 Cost of goods sold 499.5
456.6 Gross profit 61.5 46.9 Marketing, general and administration
38.6 34.6 Asset impairments and other restructuring charges 2.4 3.5
Other income, net 0.4 1.4 Earnings from operations 20.1 7.4
Interest expense, net 18.3 16.9 Other non-operating (income)
expense 0.3 0.2 Earnings before income taxes and minority interest
1.5 (9.7) Income tax provision 8.6 5.5 Loss before minority
interest (7.1) (15.2) Minority interest 3.7 1.9 Loss from
discontinued operations (4.5) (0.5) Net loss (15.3) (17.6) Loss per
common share data Basic and diluted: Loss from continuing
operations $(0.27) $(0.45) Loss from discontinued operations (0.11)
(0.01) Net loss $(0.38) $(0.46) Weighted average shares outstanding
(in millions) 39.3 38.1 HAYES LEMMERZ INTERNATIONAL, INC. AND
SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Millions of
dollars) (Unaudited) Actual Actual Three Months Three Months Ended
Ended April 30, 2007 April 30, 2006 Cash provided by operating
activities $14.9 $36.8 Cash flows from investing activities:
Purchase of property, plant, equipment and tooling (16.6) (10.9)
Proceeds from sale of assets - 0.2 Capital contribution by minority
shareholders - 0.4 Cash used for investing activities (16.6) (10.3)
Cash flows from financing activities: Changes in bank borrowings
and credit facility (0.6) (0.6) Borrowings of long term debt 8.4
(0.2) Bank finance fees paid - (2.9) Dividends paid to minority
shareholders (5.5) (1.0) Cash provided by/ (used for) financing
activities 2.3 (4.7) Net cash provided by (used for) discontinued
operations 23.7 (13.6) Effect of exchange rate changes on cash and
cash equivalents 2.0 1.9 Increase in cash and cash equivalents 26.3
10.1 Cash and cash equivalents at beginning of period 38.4 42.3
Cash and cash equivalents at end of period $64.7 $52.4 DATASOURCE:
Hayes Lemmerz International, Inc. CONTACT: Marika P. Diamond, Hayes
Lemmerz International, Inc., +1-734- 737-5162 Web site:
http://www.hayes-lemmerz.com/
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