Hayes Lemmerz Third Fiscal 2008 Quarter Net Loss
NORTHVILLE, Mich., December 4, 2008: Hayes Lemmerz International, Inc. today announced that its sales for the third fiscal quarter of 2008 were $497.0 million, down 10% from $554.9 million a year earlier. The Company reported sales of $1.634 billion for the nine months ended October 31, 2008, up slightly from $1.598 billion a year earlier.
Adjusted EBITDA for the quarter was $50.3 million, down 10% from $55.8 million a year earlier. Adjusted EBITDA for the nine months was $168.9 million, up 11% from $151.7 million in the prior nine months. Despite lower volume, the Company's EBITDA margin as a percentage of sales was above 10% for the third quarter, essentially unchanged from the year earlier quarter. Core operating earnings were $21.6 million in the third quarter, a decrease of 15% from $25.5 million in the year earlier quarter.
"We are pleased with our results in the face of extremely difficult economic and industry conditions," said Curtis J. Clawson, President, CEO and Chairman of the Board. "We are better prepared for the current economic downturn due to the significant restructuring actions that we completed over the last several years. In addition, we are reducing our global workforce by 19%, adjusting work schedules at plants, and minimizing capital expenditures and operating expenses. These initiatives have helped us to maintain EBITDA margins in the third quarter despite lower volumes, although further erosion of volumes will impact EBITDA margins. Our goal is to ensure that the Company comes through these difficult times well positioned to increase profitability when the industry recovers," said Mr. Clawson.
For the third quarter, Hayes Lemmerz reported a net loss of $10.4 million, compared with a net loss of $62.7 million in the year earlier quarter. The Company's net loss for the nine months ended October 31, 2008 was $70.2 million, an improvement of $94.9 million from a net loss of $165.1 million reported for the year earlier period.
Free cash flow for the third quarter was negative $37.5 million, compared to positive $25.6 million in the year earlier quarter. Most of the decrease in free cash flow was the result of changes in working capital, with the remainder primarily attributable to the timing of cash taxes and lower Adjusted EBITDA.
At October 31, Hayes Lemmerz had cash and cash equivalents of $57.1 million and total liquidity of $163 million, which is in line with its historical levels of liquidity. In light of the current economic downturn and industry uncertainty, the Company announced that it is seeking to amend the financial covenants in its senior secured credit facility to ensure continued compliance and to provide additional flexibility.
The Company also announced that it is withdrawing its guidance for fiscal year 2008 results due to the difficult and unpredictable conditions in the global economy and the global automotive markets.
Hayes Lemmerz announced that it will host a telephone conference call to discuss the Company's fiscal year 2008 third quarter financial results today at 10:00 a.m. (ET).
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 the Hayes Lemmerz third quarter financial results conference call, Conference ID# 70648367.
The conference call will be accompanied by a slide presentation, which can be accessed that morning through the Company's web site, in the Investor Relations section at HAYES-LEMMERZ.
A replay of the call will be available from 1:00 p.m. (ET), December 4, 2008, until 11:59 p.m. (ET), December 16, 2008, by calling (800) 642-1687 (within the United States and Canada) or (706) 645-9291 (for international calls). Please refer to Conference ID# 70648367.
An audio replay of the call is expected to be available on the Company's website beginning 48 hours after completion of the call.