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Shiloh Industries Reports Fourth-quarter Fiscal and Full-Year 2019 Results

December 19, 2019 GMT

VALLEY CITY, Ohio--(BUSINESS WIRE)--Dec 19, 2019--

Shiloh Industries, Inc. (NASDAQ: SHLO), an environmentally focused global supplier of lightweighting, noise and vibration solutions to the automotive, commercial vehicle and other industrial markets, today reported financial results for its fiscal 2019 fourth-quarter ended October 31, 2019.

Fourth-Quarter 2019 Highlights:

Full-Year 2019 Highlights:

“Shiloh had a successful fiscal 2019, winning new business, completing key product launches, expanding our global footprint, and delivering on our financial commitments,” said Ramzi Hermiz, president and chief executive officer. “Shiloh delivered on the high end of guidance with nearly $70 million in adjusted EBITDA, overcoming many headwinds, including the impact of the UAW strike at General Motors. During the year, we took important restructuring actions to better position the company to navigate market conditions. We exited 2019 with momentum as we expanded gross margin and adjusted EBITDA margin in the fourth quarter. As we execute our strategy, we are creating innovative solutions for sustainable mobility, enabling a safer and healthier environment, and setting Shiloh apart from our peers. We enter fiscal 2020 as a stronger organization with an improved cost structure that is well positioned to continue to improve our profitability and expand our sustainability efforts globally.”

2020 Outlook

Shiloh is introducing 2020 guidance for revenue of approximately $1 billion and adjusted EBITDA in the range of $75 million to $80 million, representing an increase of 7% to 15% compared to 2019.

Shiloh to Host Conference Call Today at 4:30 P.M. ET

Shiloh will host a conference call on Thursday, December 19, 2019 at 4:30 P.M. Eastern Time to discuss Shiloh’s fourth quarter fiscal 2019 financial results. The conference call can be accessed by dialing 1-877-407-0784, or for international callers, 1-201-689-8560. Please dial-in approximately five minutes in advance and request the Shiloh Industries fourth quarter fiscal 2019 results conference call. A replay will be available after the call and can be accessed by dialing 1-844-512-2921, or for international callers, 1-412-317-6671. The passcode for the replay is 13697404. The replay will be available until January 9, 2020. Interested investors and other parties may also listen to a simultaneous webcast of the conference call by logging onto the Investor Relations section of Shiloh’s website at www.shiloh.com.

Investor Contact:

For inquiries, please contact our Investor Relations department at: 1-330-558-2601 or at investors@shiloh.com.

About Shiloh Industries, Inc.

Shiloh Industries, Inc. (NASDAQ: SHLO) is a global innovative solutions provider focusing on lightweighting technologies that provide environmental and safety benefits to the mobility market. Shiloh designs and manufactures products within body structure, chassis and propulsion systems. Shiloh’s multi-component, multi-material solutions are comprised of a variety of alloys in aluminum, magnesium and steel grades, along with its proprietary line of noise and vibration reducing ShilohCore® acoustic laminate products. The strategic BlankLight®, CastLight® and StampLight® brands combine to maximize lightweighting solutions without compromising safety or performance. Shiloh has approximately 3,600 dedicated employees with operations, sales and technical centers throughout Asia, Europe and North America.

Forward-Looking Statements

Certain statements made by Shiloh in this press release regarding our operating performance, events or developments that we believe or expect to occur in the future, including those that discuss strategies, goals, outlook or other non-historical matters, or which relate to future sales, earnings expectations, cost savings, awarded sales, volume growth, earnings or general belief in our expectations of future operating results are “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are made on the basis of management’s assumptions and expectations. As a result, there can be no guarantee or assurance that these assumptions and expectations will in fact occur. The forward-looking statements are subject to risks and uncertainties that may cause actual results to materially differ from those contained in the statements due to a variety of factors, including (1) our ability to accomplish our strategic objectives; (2) our ability to obtain future sales; (3) changes in worldwide economic and political conditions, including adverse effects from terrorism or related hostilities; (4) costs related to legal and administrative matters; (5) our ability to realize cost savings expected to offset price concessions; (6) our ability to successfully integrate acquired businesses , including businesses located outside of the United States; (7) risks associated with doing business internationally, including economic, political and social instability, foreign currency exposure and the lack of acceptance of our products; (8) inefficiencies related to production and product launches that are greater than anticipated; (9) changes in technology and technological risks; (10) work stoppages and strikes at our facilities and that of our customers or suppliers; (11) our dependence on the automotive and heavy truck industries, which are highly cyclical; (12) the dependence of the automotive industry on consumer spending, which is subject to the impact of domestic and international economic conditions affecting car and light truck production; (13) regulations and policies regarding international trade; (14) financial and business downturns of our customers or vendors, including any production cutbacks or bankruptcies; (15) increases in the price of, or limitations on the availability of aluminum, magnesium or steel, our primary raw materials, or decreases in the price of scrap steel; (16) the successful launch and consumer acceptance of new vehicles for which we supply parts; (17) the impact on financial statements of any known or unknown accounting errors or irregularities; and the magnitude of any adjustments in restated financial statements of our operating results; (18) the occurrence of any event or condition that may be deemed a material adverse effect under agreements related to our outstanding indebtedness or a decrease in customer demand which could cause a covenant default under agreements related to our outstanding indebtedness; (19) pension plan funding requirements; and (20) other factors besides those listed here could also materially affect our business. See “Part I, Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended October 31, 2019 for a more complete discussion of these risks and uncertainties. Any or all of these risks and uncertainties could cause actual results to differ materially from those reflected in the forward-looking statements. These forward-looking statements reflect management’s analysis only as of the date of this Press Release. We undertake no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date of filing this Press Release. In addition to the disclosures contained herein, readers should carefully review risks and uncertainties contained in other documents we file from time to time with the SEC.

Non-GAAP Financial Measures

This press release may include non-GAAP financial measures, including “EBITDA,” “adjusted EBITDA ,” “adjusted EBITDA margin” and “adjusted earnings per share.” We define EBITDA as net income (loss) before interest, taxes, depreciation and amortization. We define adjusted EBITDA as net income (loss) before interest, taxes, depreciation, amortization, and other adjustments as described in the reconciliations accompanying this press release. We define adjusted EBITDA margin as adjusted EBITDA divided by net revenues as shown in the reconciliations accompanying this press release. Adjusted earnings per share excludes certain income and expense items as shown in the reconciliation accompanying this press release. We use EBITDA, adjusted EBITDA, adjusted EBITDA margin and adjusted earnings per share as supplements to information provided in accordance with generally accepted accounting principles (“GAAP”) in evaluating our business and they are included in this press release because they are principal factors upon which our management assesses performance. Reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP are set forth below. The non-GAAP measures presented in this release are not measures of performance under GAAP. These measures should not be considered as alternatives to the most directly comparable financial measures calculated in accordance with GAAP. Other companies in our industry may define these non-GAAP measures differently than we do and, as a result, these non-GAAP measures may not be comparable to similarly titled measures used by other companies; and certain of our non-GAAP financial measures exclude financial information that some may consider important in evaluating our performance. Given the inherent uncertainty regarding special items and other expenses in any future period, a reconciliation of forward-looking financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP is not feasible. The magnitude of these items, however, may be significant.

Adjusted Earnings Per Share Reconciliation

Three Months Ended
October 31,

Year-Ended
October 31,

 

2019

 

2018

 

2019

 

2018

Net income (loss) per common share (GAAP)

 

 

 

 

 

 

 

Basic

$(0.59)

 

$(0.36)

 

$(0.85)

 

$0.49

Tax items

0.09

 

 

0.09

 

(0.10)

Tax Cuts and Jobs Act, impact

 

 

 

(0.14)

Transformation restructuring

0.19

 

0.05

 

0.56

 

0.21

Asset impairment - non-cash

0.19

 

 

0.19

 

Amortization of intangibles

0.01

 

0.02

 

0.06

 

0.08

Marketable securities

 

 

 

0.01

Legal and professional fees

0.01

 

0.06

 

0.08

 

0.07

Adjusted basic earnings (loss) per share (non-GAAP)

$(0.10)

 

$(0.23)

 

$0.13

 

$0.62

Adjusted EBITDA Reconciliation

Three Months Ended
October 31,

 

Year- Ended
October 31,

 

2019

 

2018

 

2019

 

2018

Net income (loss)

$(13,652)

 

$(8,456)

 

$(19,947)

 

$11,479

Depreciation and amortization

11,743

 

11,953

 

46,753

 

45,728

Interest expense

4,420

 

3,148

 

16,246

 

11,333

Provision (benefit) for income taxes

2,001

 

4,635

 

(611)

 

(5,219)

EBITDA (non-GAAP)

4,512

 

11,280

 

42,441

 

63,321

Transformation restructuring

5,701

 

1,469

 

17,072

 

6,431

Legal and professional fees

239

 

1,793

 

2,530

 

2,160

Stock compensation

459

 

427

 

2,035

 

1,984

Asset impairment - non-cash

5,701

 

 

5,701

 

Marketable securities

 

 

 

154

Adjusted EBITDA (non-GAAP)

$16,612

 

$14,969

 

$69,779

 

$74,050

Adjusted EBITDA margin (non-GAAP)

6.4%

 

5.0%

 

6.6%

 

6.5%

Adjusted Operating Income

Three Months Ended
October 31,

 

Year-Ended
October 31,

 

2019

 

2018

 

2019

 

2018

Operating income (loss)

$

(7,544

)

$

(879

)

$

(5,584

)

$

18,506

Transformation restructuring

 

5,701

 

 

1,469

 

 

17,072

 

 

6,431

Asset impairment - non-cash

 

5,701

 

 

 

 

5,701

 

 

Adjusted operating income (loss)

$

3,858

$

590

$

17,189

$

24,937

SHILOH INDUSTRIES, INC.

CONSOLIDATED BALANCE SHEETS

(Dollar amounts in thousands)

 

October 31,
2019

 

October 31,
2018

 

ASSETS:

 

 

 

Cash and cash equivalents

$

14,320

 

 

$

16,843

 

Accounts receivable, net

172,468

 

 

209,733

 

Related party accounts receivable

1,477

 

 

996

 

Prepaid income taxes

1,853

 

 

1,391

 

Inventories, net

63,547

 

 

71,412

 

Prepaid expenses

8,980

 

 

10,478

 

Other current assets

13,354

 

 

22,124

 

Total current assets

275,999

 

 

332,977

 

Property, plant and equipment, net

328,026

 

 

316,176

 

Goodwill

22,395

 

 

27,376

 

Intangible assets, net

13,025

 

 

14,939

 

Deferred income taxes

5,169

 

 

5,665

 

Other assets

7,077

 

 

12,542

 

Total assets

$

651,691

 

 

$

709,675

 

LIABILITIES AND STOCKHOLDERS’ EQUITY:

 

 

 

Current debt

$

1,975

 

 

$

1,327

 

Accounts payable

155,754

 

 

177,400

 

Other accrued expenses

50,093

 

 

63,031

 

Accrued income taxes

316

 

 

1,874

 

Total current liabilities

208,138

 

 

243,632

 

Long-term debt

248,695

 

 

245,351

 

Long-term benefit liabilities

24,147

 

 

15,553

 

Deferred income taxes

798

 

 

2,894

 

Other liabilities

2,399

 

 

2,723

 

Total liabilities

484,177

 

 

510,153

 

Commitments and contingencies

 

 

 

Stockholders’ equity:

 

 

 

Preferred stock, $0.01 per share; 5,000,000 shares authorized; no shares issued and
outstanding at October 31, 2019 and October 31, 2018, respectively

 

 

 

Common stock, par value $0.01 per share; 75,000,000 and 50,000,000 shares authorized at
October 31, 2019 and October 31, 2018, respectively; 23,790,258 and 23,417,107 shares
issued and outstanding at October 31, 2019 and October 31, 2018, respectively

238

 

 

234

 

Paid-in capital

116,436

 

 

114,405

 

Retained earnings

115,866

 

 

135,813

 

Accumulated other comprehensive loss, net

(65,026

)

 

(50,930

)

Total stockholders’ equity

167,514

 

 

199,522

 

Total liabilities and stockholders’ equity

$

651,691

 

 

$

709,675

 

SHILOH INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Amounts in thousands, except per share data)

 

Three Months Ended October 31,

 

Year Ended October 31,

 

2019

 

2018

 

2019

 

2018

Net revenues

$

258,959

 

 

$

300,055

 

 

$

1,054,707

 

 

$

1,139,944

 

Cost of sales

234,341

 

 

276,233

 

 

964,131

 

 

1,023,849

 

Gross profit

24,618

 

 

23,822

 

 

90,576

 

 

116,095

 

Selling, general & administrative expenses

20,243

 

 

22,445

 

 

71,312

 

 

88,604

 

Amortization of intangible assets

517

 

 

605

 

 

2,075

 

 

2,372

 

Asset impairment, net

5,701

 

 

 

 

5,701

 

 

 

Restructuring

5,701

 

 

1,651

 

 

17,072

 

 

6,613

 

Operating income (loss)

(7,544

)

 

(879

)

 

(5,584

)

 

18,506

 

Interest expense

4,422

 

 

3,149

 

 

16,258

 

 

11,343

 

Interest income

(2

)

 

(1

)

 

(12

)

 

(10

)

Other (income) expense, net

(313

)

 

(206

)

 

(1,272

)

 

913

 

Income (loss) before income taxes

(11,651

)

 

(3,821

)

 

(20,558

)

 

6,260

 

Provision (benefit) for income taxes

2,001

 

 

4,635

 

 

(611

)

 

(5,219

)

Net income (loss)

$

(13,652

)

 

$

(8,456

)

 

$

(19,947

)

 

$

11,479

 

Income (loss) per share:

 

 

 

 

 

 

 

Basic earnings (loss) per share

$

(0.59

)

 

$

(0.36

)

 

$

(0.85

)

 

$

0.49

 

Basic weighted average number of common shares

23,566

 

 

23,309

 

 

23,506

 

 

23,229

 

Diluted earnings (loss) per share

$

(0.59

)

 

$

(0.36

)

 

$

(0.85

)

 

$

0.49

 

Diluted weighted average number of common shares

23,566

 

 

23,309

 

 

23,506

 

 

23,369

 

SHILOH INDUSTRIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollar amounts in thousands)

 

 

Year Ended October 31,

 

 

2019

 

2018

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

Net income (loss)

 

$

(19,947

)

 

$

11,479

 

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

 

 

 

 

Depreciation and amortization

 

46,753

 

 

45,728

 

Amortization of deferred financing costs

 

1,541

 

 

1,244

 

Asset impairment

 

5,701

 

 

 

Restructuring

 

4,863

 

 

280

 

Deferred income taxes

 

(3,013

)

 

(9,770

)

Stock-based compensation expense

 

2,035

 

 

1,984

 

(Gain) loss on sale of assets

 

(2,637

)

 

993

 

Loss on marketable securities

 

29

 

 

154

 

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable, net

 

34,114

 

 

(1,426

)

Inventories, net

 

7,083

 

 

412

 

Prepaids and other assets

 

(1,619

)

 

1,733

 

Payables and other liabilities

 

(41,644

)

 

(1,462

)

Prepaid and accrued income taxes

 

(2,013

)

 

1,877

 

Net cash provided by operating activities

 

31,246

 

 

53,226

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

Capital expenditures

 

(55,225

)

 

(50,135

)

Acquisitions, net of cash required

 

 

 

(62,514

)

Derivative settlements

 

5,855

 

 

 

Proceeds from sale of assets

 

12,393

 

 

3,592

 

Net cash used in investing activities

 

(36,977

)

 

(109,057

)

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

Payment of capital leases

 

(582

)

 

(886

)

Proceeds from long-term borrowings

 

280,500

 

 

266,900

 

Repayments of long-term borrowings

 

(275,100

)

 

(202,282

)

Payment of deferred financing costs

 

(1,954

)

 

(105

)

Proceeds from exercise of stock options

 

 

 

73

 

Net cash provided by (used in) financing activities

 

2,864

 

 

63,700

 

Effect of foreign currency exchange rate fluctuations on cash

 

344

 

 

238

 

Net increase (decrease) in cash and cash equivalents

 

(2,523

)

 

8,107

 

Cash and cash equivalents at beginning of period

 

16,843

 

 

8,736

 

Cash and cash equivalents at end of period

 

$

14,320

 

 

$

16,843

 

 

View source version on businesswire.com:https://www.businesswire.com/news/home/20191219005656/en/

CONTACT: Kevin Doherty

investors@shiloh.com

1-330-558-2601

KEYWORD: UNITED STATES NORTH AMERICA MICHIGAN OHIO

INDUSTRY KEYWORD: ALTERNATIVE VEHICLES/FUELS AUTOMOTIVE GENERAL AUTOMOTIVE MARKETING AUTOMOTIVE MANUFACTURING ADVERTISING COMMUNICATIONS MANUFACTURING PERFORMANCE & SPECIAL INTEREST

SOURCE: Shiloh Industries, Inc.

Copyright Business Wire 2019.

PUB: 12/19/2019 04:05 PM/DISC: 12/19/2019 04:05 PM

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