Myers Industries Reports 2018 First Quarter Results
AKRON, Ohio--(BUSINESS WIRE)--May 7, 2018--Myers Industries, Inc. (NYSE: MYE) today announced results for the first quarter ended March 31, 2018.
First Quarter 2018 Business Highlights
The Company reported net sales of $152.6 million, compared to $136.6 million in the first quarter of 2017, with the increase primarily driven by greater demand within the Company’s food and beverage end market. Gross profit margin increased 30 basis points to 30.9% as compared to the prior year, primarily due to the higher sales volume. Selling, general and administrative expenses increased by $1.0 million to $35.5 million, in the first quarter of 2018, with the increase in expenses primarily attributable to higher incentive compensation costs.
President and Chief Executive Officer Dave Banyard commented, “We are pleased with our performance to start the year, which demonstrated strong year-over-year improvement in both sales and earnings. We saw sequential improvements in key operating metrics each month, and overall improvement in gross margin and operating profit from the fourth quarter of last year.”
Banyard continued, “Our focus on niche market strategies resulted in a third consecutive quarter of double-digit sales growth in our food and beverage end market. Increased demand coupled with the positive impact of last year’s manufacturing footprint realignment and restructuring initiatives produced significant operating income growth and strong free cash flow generation. We look forward to the continuation of this trend in our cash flow performance in 2018 and expect it to enable further investments in both organic and acquisitive growth.”
Net sales in the Material Handling Segment increased 18.6% (or 18.2% excluding currency fluctuation) compared to the first quarter of 2017. The increase in net sales was primarily due to increased volume in the Company’s food and beverage end market. The segment’s adjusted EBITDA was $23.0 million compared to $20.8 million in the first quarter of 2017. The increase in adjusted EBITDA was primarily the result of higher sales volume and the benefit from the restructuring actions taken in 2017.
Net sales in the Distribution Segment declined 7.2% compared to the first quarter of 2017. The decrease in net sales was partially the result of the Company’s planned exit from a low-margin custom product in the Patch Rubber business. The organization continues to work to improve sales force effectiveness in its Myers Tire Supply business. The segment’s adjusted EBITDA was $1.4 million compared to $1.8 million in the first quarter of 2017.
For the fiscal year 2018, the Company continues to anticipate that total revenue will be up low-to-mid single-digits on a constant currency basis compared to the prior year based on strong backlog, tempered by the non-recurrence of some large, one-time orders delivered in the second half of 2017. The Company also expects capital expenditures to be in the range of $10 to $12 million, net interest expense to be between $7 and $8 million, and depreciation and amortization to be between $26 and $28 million. The Tax Cuts and Jobs Act will benefit the Company through a decrease in its effective tax rate, which is expected to be approximately 25%, compared to approximately 36% previously.
Conference Call Details
The Company will host an earnings conference call and webcast for investors and analysts on Monday, May 7, at 10:00 a.m. EDT. The call is anticipated to last approximately one hour and may be accessed at: (US) 833-233-3452 or (Int’l) 647-689-4129. The Conference ID # is 2597462. Callers are asked to sign on at least five minutes in advance. The live webcast of the conference call can be accessed from the Investor Relations section of the Company’s website at www.myersindustries.com. Click on the Investor Relations tab to access the webcast. Webcast attendees will be in a listen-only mode. An archived replay of the call will also be available on the site shortly after the event. To listen to the telephone replay, callers should dial: (US) 800-585-8367 or (Int’l) 416-621-4642. The Conference ID # is 2597462.
Use of Non-GAAP Financial Measures
The Company uses certain non-GAAP measures in this release. Adjusted net income per diluted share from continuing operations, income from continuing operations as adjusted, adjusted income per diluted share from continuing operations, operating income as adjusted, adjusted operating income, adjusted EPS, adjusted EBITDA and free cash flow are non-GAAP financial measures and are intended to serve as a supplement to results provided in accordance with accounting principles generally accepted in the United States. Myers Industries believes that such information provides an additional measurement and consistent historical comparison of the Company’s performance. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is available in this news release.
About Myers Industries
Myers Industries, Inc. is an international manufacturer of polymer products for industrial, agricultural, automotive, commercial and consumer markets. The Company is also the largest distributor of tools, equipment and supplies for the tire, wheel and under vehicle service industry in the United States. Visit www.myersindustries.com to learn more.
Caution on Forward-Looking Statements
Statements in this release may include “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statement that is not of historical fact may be deemed “forward-looking”. Words such as “expect”, “believe”, “project”, “plan”, “anticipate”, “intend”, “objective”, “goal”, “view” and similar expressions identify forward-looking statements. These statements are based on management’s current views and assumptions of future events and financial performance and involve a number of risks and uncertainties, many outside of the Company’s control that could cause actual results to materially differ from those expressed or implied. Risks and uncertainties include: raw material availability, increases in raw material costs, or other production costs; risks associated with our strategic growth initiatives or the failure to achieve the anticipated benefits of such initiatives; unanticipated downturn in business relationships with customers or their purchases; competitive pressures on sales and pricing; changes in the markets for the Company’s business segments; changes in trends and demands in the markets in which the Company competes; unexpected failures at our manufacturing facilities; future economic and financial conditions in the United States and around the world; inability of the Company to meet future capital requirements; claims, litigation and regulatory actions against the Company; changes in laws and regulations affecting the Company; and other risks as detailed in the Company’s 10-K and other reports filed with the Securities and Exchange Commission. Such reports are available on the Securities and Exchange Commission’s public reference facilities and its website at www.sec.gov, and on the Company’s Investor Relations section of its website at www.myersindustries.com. Myers Industries undertakes no obligation to publicly update or revise any forward-looking statements contained herein. These statements speak only as of the date made.
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