CANTON, Ohio, Nov. 6, 2019 /PRNewswire/ -- TimkenSteel
(NYSE: TMST), a leader in customized alloy steel products and
services, today reported 2019 third-quarter net sales of
$274.2 million and a net loss of
$4.6 million or minus $0.10 per diluted share. In the same quarter last
year, net sales were $409.9 million
with net income of $1.4 million or
$0.03 per diluted share.
EBITDA(1) for the third quarter of 2019 was $14.4 million, a decrease of $12.1 million from adjusted
EBITDA(1)over the same quarter last year.
During the quarter, the company effectively managed its working
capital and generated positive free cash flow(1) of
$33 million. This enabled the company
to pay down $35 million in debt,
which represents the lowest borrowing level since 2017.
"As expected, we continue to be challenged by our end markets.
We are laser-focused on improving customer engagement and outcomes
while driving financial and structural improvements through what we
can control, including cost reduction, cash generation and enhanced
liquidity," said Terry L. Dunlap,
interim chief executive officer and president. "We are acting with
urgency and pace to improve profitability, cash flow and
shareholder value."
THIRD QUARTER OF 2019 FINANCIAL SUMMARY
For the quarter, net sales decreased $136
million or 33 percent compared with the prior-year quarter.
The decline in net sales compared with the prior-year period is due
to lower volume as well as lower raw material surcharges.
- Ship tons were 209,600, a decrease of 29 percent from the
prior-year period as a result of lower shipments across most of the
company's end markets.
- Surcharge revenue decreased $56
million from the prior-year period primarily due to a
declining No. 1 busheling scrap index and lower volume.
- These decreases were partially offset by favorable base price
and mix.
(1) Please see discussion of non-GAAP
financial measures in this news release.
Third-quarter EBITDA(1) decreased to $14.4 million compared with adjusted
EBITDA(1) of $26.5 million
for the same period a year ago.
- Lower demand drove a 31 percent decline in melt utilization and
unfavorable fixed cost leverage, partially offset by savings from
cost reduction initiatives and lower annual maintenance costs.
- Price and mix benefited from the continuing impact of
prior-year spot price increases and 2019 contract pricing, along
with lower shipments of OCTG billets, contributing to a richer mix
of product sales.
- LIFO was a benefit of approximately $16
million compared with a cost of approximately $3 million for the same period a year ago.
- SG&A expenses declined as a result of the company's
profitability improvement plans that targeted, among other areas, a
reduction in salaried employees, lower professional services fees
and lower benefit costs. Additionally, variable compensation
decreased year over year.
AMENDED CREDIT AGREEMENT
"On October 15, 2019 we completed
a refinancing of our asset-based revolving credit facility, or ABL.
The amended ABL, which matures on October
15, 2024, increases our borrowing capacity by $100 million to $400
million in total," said Kristopher
R. Westbrooks, executive vice president and chief financial
officer. "We are pleased with the improved financial terms and
additional liquidity provided by the new facility, and we
appreciate the confidence and support of our bank group."
- The company reduced the interest rate to be paid on ABL
borrowings by 50 basis points and reduced the unused commitment fee
to a fixed 25 basis points from the previous 37.5 to 50 basis-point
range.
- The amended credit agreement is estimated to save the company
approximately $1 million of cash
interest per year at historical borrowing levels.
PROFITABILITY IMPROVEMENT PLAN UPDATE
As part of its profitability improvement plan, the company
remains focused on cost savings, improved efficiency and better
resource allocation. These activities are aimed at improving
performance and refining the company's structure and processes.
- In October, the company took restructuring actions including
reducing management layers.
- These restructuring activities are expected to provide the
company $3.5 million in annualized
savings beginning in 2020 and are part of the company's previously
stated targets of approximately $60
million of profitability improvement on an annualized basis
beginning in 2020, with approximately $35
million expected to be realized in 2019.
FOURTH QUARTER OF 2019 OUTLOOK
The company expects fourth-quarter shipments to be down from the
third-quarter 2019 by approximately 15 percent. Adjusted
EBITDA(1) is projected to be between break-even to
negative $10 million. Due to the
expected full remeasurement of the company's pension and
post-retirement plan assets and obligations at Dec. 31, 2019, the company is unable to reconcile
its fourth-quarter outlook for adjusted EBITDA(1) to a
comparable GAAP range. The gain or loss from re-measurement cannot
be estimated at this time.
Production levels are expected to be below third-quarter 2019 as
a result of continued balancing of production with demand.
Surcharge revenue is expected to be lower due to a declining No. 1
busheling scrap index. LIFO is projected to continue to be a
benefit, but at a level below third quarter of 2019. Capital
spending is projected to be approximately $15 million to $20
million in the fourth quarter.
TIMKENSTEEL EARNINGS CALL INFORMATION
The company will host a conference call at 9 a.m. ET on
Thursday, November 7, 2019, to
discuss its financial performance with investors and securities
analysts. The financial results and conference call materials will
be available online at investors.timkensteel.com.
Conference
Call
|
Thursday, November 7,
2019 9 a.m.
ET Toll-free dial-in:
833-238-7951 International
dial-in: 647-689-4199 Conference ID: 5006089
|
Conference Call
Replay
|
Replay
dial-in available through November 14, 2019 800-585-8367 or 416-621-4642 Replay
passcode: 5006089
|
About TimkenSteel Corporation
TimkenSteel (NYSE:TMST,
timkensteel.com) creates tailored steel products and services for
demanding applications, helping customers push the bounds of what's
possible within their industries. The company reaches around the
world in its customers' products and leads North America in large alloy steel bars (up to
16 inches in diameter) and seamless mechanical tubing made of its
special bar quality (SBQ) steel, as well as supply chain and steel
services. TimkenSteel operates warehouses and sales offices in five
countries and has made its steel in America for more than 100
years. In 2018, the company posted sales of $1.6 billion and also achieved its safest year on
record. Follow us on Twitter @TimkenSteel and on Instagram.
-###-
NON-GAAP FINANCIAL MEASURES
TimkenSteel reports its financial results in accordance with
accounting principles generally accepted in the United States ("GAAP") and corresponding
metrics as non-GAAP financial measures. This earnings release
includes references to the following non-GAAP financial measures:
EBIT, EBITDA, Adjusted EBIT, Adjusted EBITDA and free cash flow.
These are important financial measures used in the management of
the business, including decisions concerning the allocation of
resources and assessment of performance. Management believes that
reporting these non-GAAP financial measures is useful to investors
as these measures are representative of the company's performance
and provide improved comparability of results. See the
attached schedules for definitions of the non-GAAP financial
measures referred to above and corresponding reconciliations of
these non-GAAP financial measures to the most comparable GAAP
financial measures. At this time, the company is unable to
reconcile its fourth quarter outlook for Adjusted EBITDA to a
comparable GAAP range due to an expected re-measurement of its
pension and postretirement benefit plans at year-end 2019. The
amount of the gain or loss from the re-measurement cannot currently
be estimated at this time. Non-GAAP financial measures should be
viewed as additions to, and not as alternatives for, TimkenSteel's
results prepared in accordance with GAAP. In addition, the non-GAAP
measures TimkenSteel uses may differ from non-GAAP measures used by
other companies, and other companies may not define the non-GAAP
measures TimkenSteel uses in the same way.
FORWARD-LOOKING STATEMENTS
This news release includes "forward-looking" statements
within the meaning of the federal securities laws. You can
generally identify the company's forward-looking statements by
words such as "will," "anticipate," "believe," "could," "estimate,"
"expect," "forecast," "outlook," "intend," "may," "possible,"
"potential," "predict," "project," "seek," "target," "could,"
"may," "should" or "would" or other similar words, phrases or
expressions that convey the uncertainty of future events or
outcomes. The company cautions readers that actual results may
differ materially from those expressed or implied in
forward-looking statements made by or on behalf of the company due
to a variety of factors, such as: whether the company is able to
successfully implement actions designed to improve profitability on
anticipated terms and timetables and whether the company is able to
fully realize the expected benefits of such actions; deterioration
in world economic conditions, or in economic conditions in any of
the geographic regions in which the company conducts business,
including additional adverse effects from global economic slowdown,
terrorism or hostilities, including political risks associated with
the potential instability of governments and legal systems in
countries in which the company or its customers conduct business,
and changes in currency valuations; the effects of fluctuations in
customer demand on sales, product mix and prices in the industries
in which the company operates, including the ability of the company
to respond to rapid changes in customer demand, the effects of
customer bankruptcies or liquidations, the impact of changes in
industrial business cycles, and whether conditions of fair trade
exist in U.S. markets; competitive factors, including changes in
market penetration, increasing price competition by existing or new
foreign and domestic competitors, the introduction of new products
by existing and new competitors, and new technology that may impact
the way the company's products are sold or distributed; changes in
operating costs, including the effect of changes in the company's
manufacturing processes, changes in costs associated with varying
levels of operations and manufacturing capacity, availability of
raw materials and energy, the company's ability to mitigate the
impact of fluctuations in raw materials and energy costs and the
effectiveness of its surcharge mechanism, changes in the expected
costs associated with product warranty claims, changes resulting
from inventory management, cost reduction initiatives and different
levels of customer demands, the effects of unplanned work
stoppages, and changes in the cost of labor and benefits; the
success of the company's operating plans, announced programs,
initiatives and capital investments (including the jumbo bloom
vertical caster and advanced quench-and-temper facility), the
ability to integrate acquired companies, the ability of acquired
companies to achieve satisfactory operating results, including
results being accretive to earnings, and the company's ability to
maintain appropriate relations with unions that represent its
associates in certain locations in order to avoid disruptions of
business; unanticipated litigation, claims or assessments,
including claims or problems related to intellectual property,
product liability or warranty, and environmental issues and taxes,
among other matters; the availability of financing and interest
rates, which affect the company's cost of funds and/or ability to
raise capital, the company's pension obligations and investment
performance, and/or customer demand and the ability of customers to
obtain financing to purchase the company's products or equipment
that contain its products; the amount of any dividend declared by
the company's Board of Directors on the company's common shares;
and the overall impact of mark-to-market accounting. Additional
risks relating to the company's business, the industries in which
the company operates or the company's common shares may be
described from time to time in the company's filings with the SEC.
All of these risk factors are difficult to predict, are subject to
material uncertainties that may affect actual results and may be
beyond the company's control. Readers are cautioned that it
is not possible to predict or identify all of the risks,
uncertainties and other factors that may affect future results and
that the above list should not be considered to be a complete list.
Except as required by the federal securities laws, the company
undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
(Dollars in
millions, except per share data) (Unaudited)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net sales
|
$
|
274.2
|
|
|
$
|
409.9
|
|
|
$
|
981.9
|
|
|
$
|
1,204.2
|
|
Cost of products
sold
|
261.0
|
|
|
385.3
|
|
|
914.2
|
|
|
1,126.4
|
|
Gross
Profit
|
13.2
|
|
|
24.6
|
|
|
67.7
|
|
|
77.8
|
|
Selling, general
& administrative expenses (SG&A)
|
21.4
|
|
|
24.0
|
|
|
64.9
|
|
|
73.6
|
|
Restructuring
charges
|
—
|
|
|
—
|
|
|
3.6
|
|
|
—
|
|
Impairment charges
and loss on asset disposals
|
0.1
|
|
|
—
|
|
|
1.9
|
|
|
0.9
|
|
Other income,
net
|
5.2
|
|
|
6.1
|
|
|
8.1
|
|
|
18.7
|
|
Earnings Before
Interest and Taxes (EBIT) (1)
|
(3.1)
|
|
|
6.7
|
|
|
5.4
|
|
|
22.0
|
|
Interest
expense
|
3.6
|
|
|
4.4
|
|
|
12.0
|
|
|
12.9
|
|
Income (Loss)
Before Income Taxes
|
(6.7)
|
|
|
2.3
|
|
|
(6.6)
|
|
|
9.1
|
|
Provision (benefit)
for income taxes
|
(2.1)
|
|
|
0.9
|
|
|
(1.8)
|
|
|
1.2
|
|
Net Income
(Loss)
|
$
|
(4.6)
|
|
|
$
|
1.4
|
|
|
$
|
(4.8)
|
|
|
$
|
7.9
|
|
|
|
|
|
|
|
|
|
Net Income (Loss)
per Common Share:
|
|
|
|
|
|
|
|
Basic loss per
share
|
$
|
(0.10)
|
|
|
$
|
0.03
|
|
|
$
|
(0.11)
|
|
|
$
|
0.18
|
|
Diluted loss per
share (2)
|
$
|
(0.10)
|
|
|
$
|
0.03
|
|
|
$
|
(0.11)
|
|
|
$
|
0.17
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding - basic
|
44.8
|
|
|
44.6
|
|
|
44.8
|
|
|
44.5
|
|
Weighted average
shares outstanding - diluted
|
44.8
|
|
|
45.2
|
|
|
44.8
|
|
|
45.2
|
|
|
|
|
|
|
|
|
|
(1) EBIT is defined as net income
(loss) before interest expense and income taxes. EBIT is an
important financial measure used in the management of the business,
including decisions concerning the allocation of resources and
assessment of performance. Management believes that reporting EBIT
is useful to investors as this measure is representative of the
Company's performance.
|
(2) Common share
equivalents for shares issuable for equity-based awards were
excluded from the computation of diluted earnings (loss) per share
for the three and nine months ended September 30, 2019 because the
effect of their inclusion would have been anti-dilutive. Common
share equivalents for shares issuable upon the conversion of
outstanding convertible notes, were excluded from the computation
of diluted earnings (loss) per share for the three and nine months
ended September 30, 2019 and 2018 because the effect of their
inclusion would have been anti-dilutive.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Dollars in
millions) (Unaudited)
|
September 30,
2019
|
|
December 31,
2018
|
ASSETS
|
|
|
|
Cash and cash
equivalents
|
$
|
18.4
|
|
|
$
|
21.6
|
|
Accounts receivable,
net of allowances
|
107.4
|
|
|
163.4
|
|
Inventories,
net
|
279.4
|
|
|
296.8
|
|
Deferred charges and
prepaid expenses
|
4.9
|
|
|
3.5
|
|
Other current
assets
|
7.9
|
|
|
6.1
|
|
Total Current
Assets
|
418.0
|
|
|
491.4
|
|
|
|
|
|
Property, plant and
equipment, net
|
643.0
|
|
|
674.4
|
|
Operating lease
right-of-use assets
|
14.2
|
|
|
—
|
|
Pension
assets
|
13.2
|
|
|
10.5
|
|
Intangible assets,
net
|
16.2
|
|
|
17.8
|
|
Other non-current
assets
|
2.7
|
|
|
3.5
|
|
Total
Assets
|
$
|
1,107.3
|
|
|
$
|
1,197.6
|
|
|
|
|
|
LIABILITIES
|
|
|
|
Accounts
payable
|
$79.0
|
|
|
$160.6
|
|
Salaries, wages and
benefits
|
17.0
|
|
|
36.8
|
|
Accrued pension and
postretirement costs
|
3.0
|
|
|
3.0
|
|
Current operating
lease liabilities
|
6.1
|
|
|
—
|
|
Other current
liabilities
|
17.4
|
|
|
20.4
|
|
Total Current
Liabilities
|
122.5
|
|
|
220.8
|
|
|
|
|
|
Convertible notes,
net
|
77.4
|
|
|
74.1
|
|
Credit
agreement
|
110.0
|
|
|
115.0
|
|
Non-current operating
lease liabilities
|
8.2
|
|
|
—
|
|
Accrued pension and
postretirement costs
|
178.5
|
|
|
240.0
|
|
Deferred income
taxes
|
0.6
|
|
|
0.8
|
|
Other non-current
liabilities
|
10.4
|
|
|
11.7
|
|
Total
Liabilities
|
507.6
|
|
|
662.4
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
Additional paid-in
capital
|
842.8
|
|
|
846.3
|
|
Retained
deficit
|
(274.0)
|
|
|
(269.2)
|
|
Treasury
shares
|
(25.1)
|
|
|
(33.0)
|
|
Accumulated other
comprehensive income (loss)
|
56.0
|
|
|
(8.9)
|
|
Total Shareholders'
Equity
|
599.7
|
|
|
535.2
|
|
Total Liabilities and
Shareholders' Equity
|
$
|
1,107.3
|
|
|
$
|
1,197.6
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(Dollars in
millions) (Unaudited)
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Operating
Activities
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
|
(4.6)
|
|
|
$
|
1.4
|
|
|
$
|
(4.8)
|
|
|
$
|
7.9
|
|
Adjustments to
reconcile net income (loss) to net cash provided
(used) by operating
activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
17.5
|
|
|
18.1
|
|
|
53.2
|
|
|
55.0
|
|
Amortization of
deferred financing fees and debt discount
|
1.2
|
|
|
1.3
|
|
|
3.7
|
|
|
4.3
|
|
Impairment charges
and loss on sale or disposal of assets
|
0.1
|
|
|
—
|
|
|
1.9
|
|
|
0.9
|
|
Deferred income
taxes
|
(2.1)
|
|
|
0.6
|
|
|
(2.3)
|
|
|
0.3
|
|
Stock-based
compensation expense
|
1.4
|
|
|
2.2
|
|
|
5.2
|
|
|
5.9
|
|
Pension and
postretirement expense (benefit), net
|
(0.4)
|
|
|
(1.4)
|
|
|
6.0
|
|
|
(4.3)
|
|
Pension and
postretirement contributions and payments
|
1.2
|
|
|
0.5
|
|
|
(2.3)
|
|
|
(12.4)
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
39.0
|
|
|
1.5
|
|
|
56.0
|
|
|
(22.3)
|
|
Inventories,
net
|
25.4
|
|
|
9.2
|
|
|
17.4
|
|
|
(61.3)
|
|
Accounts
payable
|
(31.3)
|
|
|
(39.0)
|
|
|
(81.6)
|
|
|
3.5
|
|
Other accrued
expenses
|
(2.4)
|
|
|
7.0
|
|
|
(24.7)
|
|
|
(5.9)
|
|
Deferred charges and
prepaid expenses
|
(2.3)
|
|
|
(2.4)
|
|
|
(1.4)
|
|
|
(0.8)
|
|
Other, net
|
(0.8)
|
|
|
2.7
|
|
|
(2.0)
|
|
|
0.8
|
|
Net Cash Provided
(Used) by Operating Activities
|
41.9
|
|
|
1.7
|
|
|
24.3
|
|
|
(28.4)
|
|
Investing
Activities
|
|
|
|
|
|
|
|
Capital
expenditures
|
(9.4)
|
|
|
(8.7)
|
|
|
(21.7)
|
|
|
(17.7)
|
|
Proceeds from
disposals of property, plant and equipment
|
—
|
|
|
—
|
|
|
—
|
|
|
1.0
|
|
Net Cash Used by
Investing Activities
|
(9.4)
|
|
|
(8.7)
|
|
|
(21.7)
|
|
|
(16.7)
|
|
Financing
Activities
|
|
|
|
|
|
|
|
Proceeds from
exercise of stock options
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.2
|
|
Shares surrendered
for employee taxes on stock compensation
|
—
|
|
|
—
|
|
|
(1.0)
|
|
|
(0.7)
|
|
Refunding Bonds
repayments
|
—
|
|
|
—
|
|
|
—
|
|
|
(30.2)
|
|
Repayments on credit
agreements
|
(35.0)
|
|
|
(5.0)
|
|
|
(45.0)
|
|
|
(75.0)
|
|
Borrowings on credit
agreements
|
—
|
|
|
|
|
40.0
|
|
|
155.0
|
|
Debt issuance
costs
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.7)
|
|
Net Cash Provided
(Used) by Financing Activities
|
(35.0)
|
|
|
(5.0)
|
|
|
(5.8)
|
|
|
47.6
|
|
Increase (Decrease)
in Cash and Cash Equivalents
|
(2.5)
|
|
|
(12.0)
|
|
|
(3.2)
|
|
|
2.5
|
|
Cash and cash
equivalents at beginning of period
|
20.9
|
|
|
39.0
|
|
|
21.6
|
|
|
24.5
|
|
Cash and Cash
Equivalents at End of Period
|
$
|
18.4
|
|
|
$
|
27.0
|
|
|
$
|
18.4
|
|
|
$
|
27.0
|
|
Reconciliation of
Earnings (Loss) Before Interest and Taxes (EBIT) (1),
Adjusted EBIT(3), Earnings (Loss) Before Interest,
Taxes, Depreciation and Amortization (EBITDA) (2) and
Adjusted EBITDA (4) to GAAP Net Income
(Loss):
|
This reconciliation
is provided as additional relevant information about the company's
performance. EBIT, Adjusted EBIT, EBITDA and Adjusted EBITDA are
important financial measures used in the management of the
business, including decisions concerning the allocation of
resources and assessment of performance. Management believes
that reporting EBIT, Adjusted EBIT, EBITDA and Adjusted EBITDA is
useful to investors as these measures are representative of the
company's performance. Management also believes that it is
appropriate to compare GAAP net income (loss) to EBIT, Adjusted
EBIT, EBITDA and Adjusted EBITDA.
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
(Dollars in
millions) (Unaudited)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net income
(loss)
|
$
|
(4.6)
|
|
|
$
|
1.4
|
|
|
$
|
(4.8)
|
|
|
$
|
7.9
|
|
|
|
|
|
|
|
|
|
Provision (benefit)
for income taxes
|
(2.1)
|
|
|
0.9
|
|
|
(1.8)
|
|
|
1.2
|
|
Interest
expense
|
3.6
|
|
|
4.4
|
|
|
12.0
|
|
|
12.9
|
|
Earnings Before
Interest and Taxes (EBIT) (1)
|
$
|
(3.1)
|
|
|
$
|
6.7
|
|
|
$
|
5.4
|
|
|
$
|
22.0
|
|
EBIT Margin
(1)
|
(1.1)
|
%
|
|
1.6
|
%
|
|
0.5
|
%
|
|
1.8
|
%
|
Depreciation and
amortization
|
17.5
|
|
|
18.1
|
|
|
53.2
|
|
|
55.0
|
|
Earnings Before
Interest, Taxes, Depreciation and
Amortization (EBITDA) (2)
|
$
|
14.4
|
|
|
$
|
24.8
|
|
|
$
|
58.6
|
|
|
$
|
77.0
|
|
EBITDA Margin
(2)
|
5.3
|
%
|
|
6.1
|
%
|
|
6.0
|
%
|
|
6.4
|
%
|
|
|
|
|
|
|
|
|
Executive severance
costs
|
—
|
|
|
(1.7)
|
|
|
—
|
|
|
(1.7)
|
|
Loss on abandonment
of long-lived assets
|
—
|
|
|
—
|
|
|
(1.6)
|
|
|
—
|
|
Restructuring
charges
|
—
|
|
|
—
|
|
|
(3.6)
|
|
|
—
|
|
Loss from
remeasurement of benefit plans
|
—
|
|
|
—
|
|
|
(4.4)
|
|
|
—
|
|
Adjusted EBIT
(3)
|
$
|
(3.1)
|
|
|
$
|
8.4
|
|
|
$
|
15.0
|
|
|
$
|
23.7
|
|
Adjusted EBIT Margin
(3)
|
(1.1)
|
%
|
|
2.0
|
%
|
|
1.5
|
%
|
|
2.0
|
%
|
Adjusted EBITDA
(4)
|
$
|
14.4
|
|
|
$
|
26.5
|
|
|
$
|
68.2
|
|
|
$
|
78.7
|
|
Adjusted EBITDA
Margin (4)
|
5.3
|
%
|
|
6.5
|
%
|
|
6.9
|
%
|
|
6.5
|
%
|
|
|
|
|
|
|
|
|
(1) EBIT is defined as net income
(loss) before interest expense and income taxes. EBIT Margin is
EBIT as a percentage of net sales.
|
(2) EBITDA is defined as net income
(loss) before interest expense, income taxes, depreciation and
amortization. EBITDA Margin is EBITDA as a percentage of net
sales.
|
(3)
Adjusted EBIT is defined as EBIT excluding for the nine month
period ended September 30, 2019, the loss from remeasurement of
benefit plans, restructuring charges, and loss on abandonment of
long-lived assets and for the three and nine month periods ended
September 30, 2018, executive severance. Adjusted EBIT Margin is
Adjusted EBIT as a percentage of net sales.
|
(4) Adjusted EBITDA is defined as
EBITDA excluding for the nine month period ended September 30,
2019, the loss from remeasurement of benefit plans, restructuring
charges, and loss on abandonment of long-lived assets and for the
three and nine month periods ended September 30, 2018, executive
severance. Adjusted EBITDA Margin is Adjusted EBITDA as a
percentage of net sales.
|
Reconciliation of
Free Cash Flow(1) to GAAP Net Cash Provided (Used) by
Operating Activities:
|
This reconciliation
is provided as additional relevant information about the Company's
financial position. Free cash flow is an important financial
measure used in the management of the business. Management believes
that free cash flow is useful to investors because it is a
meaningful indicator of cash generated from operating activities
available for the execution of its business strategy.
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
(Dollars in
millions) (Unaudited)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
Net Cash Provided
(Used) by Operating Activities
|
$
|
41.9
|
|
|
$
|
1.7
|
|
|
$
|
24.3
|
|
|
$
|
(28.4)
|
|
Less: Capital
expenditures
|
(9.4)
|
|
|
(8.7)
|
|
|
(21.7)
|
|
|
(17.7)
|
|
Free Cash
Flow
|
$
|
32.5
|
|
|
$
|
(7.0)
|
|
|
$
|
2.6
|
|
|
$
|
(46.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Free Cash Flow is defined as net
cash provided (used) by operating activities less capital
expenditures.
|
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SOURCE TimkenSteel