Accuride Corporation Reports Second Quarter Results for 2004
EVANSVILLE, Ind.--Aug. 1, 20042, 2004--Accuride Corporation today announced net sales of $120.6 million for the second quarter ended June 30, 2004. This compares to net sales of $94.2 million for the second quarter of 2003, an increase of 28.0%. The increase is a result of the continuing cyclical recovery and greater penetration of aluminum wheels in the commercial vehicle industry. For the six months ended June 30, 2004, net sales were $232.0 million compared to net sales of $182.5 million for the same six-month period in 2003, an increase of 27.1%.Adjusted EBITDA of $26.4 million for the second quarter ended June 30, 2004, is up from $19.4 million for the second quarter of 2003, an increase of 36.1%. The resulting EBITDA margin has increased to 21.9% of net sales from 20.6% of net sales in last year's second quarter, primarily due to increased volume. For the first six months of 2004, Adjusted EBITDA increased by $12.4 million, or 34.3%, to reach $48.6 million. The purpose and reconciliation of Adjusted EBITDA for the Company to the most directly comparable GAAP measure is set forth on Page 4 of this press release.
"We believe the demand for trucks is being fueled by the 6% increase in freight tonnage since the start of the year, which has improved the profitability of fleets enabling them to replace their aging equipment. Class 8 truck production, the bellwether of the commercial vehicle industry, is up 44% since the start of the year," said Terry Keating, Accuride's President and CEO. "Heading into the second half of 2004, revenue should remain strong but the rising costs associated with raw material continue to be challenging."
The Company's liquidity position remained strong at June 30, 2004, with $40.9 million in cash and revolver availability of $41.0 million.
Accuride had net income of $4.8 million, or 4.0% of net sales, for the second quarter ended June 30, 2004, compared to a net loss of $6.0 million, or a negative 6.4% of net sales, for the second quarter of 2003. For the six months ended June 30, 2004, Accuride had a net income of $9.5 million, or 4.1% of net sales, compared to a net loss of $6.5 million, or a negative 3.6% of net sales, for the same six-month period in 2003.
Accuride Corporation is North America's largest manufacturer and supplier of wheels for heavy/medium trucks and trailers. The Company offers the broadest product line in the North American heavy/medium wheel industry and is the only North American manufacturer and supplier of both steel and forged aluminum heavy/medium wheels. Accuride Corporation also produces wheels for buses, commercial light trucks, pick-up trucks, sport utility vehicles, and vans. Accuride Corporation has steel wheel operations in Henderson, Kentucky; London, Ontario, Canada; and Monterrey, Mexico. Accuride has aluminum wheel operations in Erie, Pennsylvania, and Cuyahoga Falls, Ohio. Additionally, the Company produces tire molds at its Erie, Pennsylvania, facility. Accuride is also involved in a commercial tire and wheel assembly joint venture in Springfield, Ohio. For more information, visit Accuride's website at http://www.accuridecorp.com.
ACCURIDE CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(DOLLARS IN THOUSANDS)
(UNAUDITED)
Three Months Ended
June 30,
-------------------
2004 2003
--------- ---------
NET SALES $120,631 $94,207
COST OF GOODS SOLD 95,488 75,690
--------- ---------
GROSS PROFIT $25,143 $18,517
OPERATING EXPENSES:
Selling, General & Administrative 6,418 6,305
--------- ---------
INCOME FROM OPERATIONS 18,725 12,212
OTHER INCOME (EXPENSE):
Interest Income 30 59
Interest (Expense) (9,063) (9,473)
Refinancing Costs - (11,257)
Equity in Earnings of Affiliates 155 199
Other Income (Expense), Net (1,676) 110
--------- ---------
INCOME (LOSS) BEFORE INCOME TAXES 8,171 (8,150)
INCOME TAX PROVISION (BENEFIT) 3,393 (2,197)
--------- ---------
NET INCOME (LOSS) $4,778 $(5,953)
========= =========
Six Months Ended
June 30,
-------------------
2004 2003
--------- ---------
NET SALES $232,032 $182,455
COST OF GOODS SOLD 184,925 148,317
--------- ---------
GROSS PROFIT $47,107 $34,138
OPERATING:
Selling, General & Administrative 12,789 12,194
--------- ---------
INCOME FROM OPERATIONS 34,318 21,944
OTHER INCOME (EXPENSE):
Interest Income 55 131
Interest (Expense) (18,276) (18,385)
Refinancing Costs - (11,257)
Equity in Earnings of Affiliates 293 379
Other (Expense), Net (1,537) (503)
--------- ---------
INCOME (LOSS) BEFORE INCOME TAXES 14,853 (7,691)
INCOME TAX PROVISION (BENEFIT) 5,308 (1,160)
--------- ---------
NET INCOME (LOSS) $9,545 $(6,531)
========= =========
ACCURIDE CORPORATION
CONSOLIDATED ADJUSTED EBITDA
(DOLLARS IN THOUSANDS)
(UNAUDITED)
Three Months Ended
June 30,
-----------------
2004 2003
-------- --------
NET INCOME (LOSS) 4,778 (5,953)
Net Interest Expense 9,033 9,414
Income Taxes 3,393 (2,197)
Refinancing Costs - 11,257
Equity in Earnings of Affiliates (155) (199)
Other Expense (Income), Net 1,676 (110)
-------- --------
INCOME FROM OPERATIONS 18,725 12,212
Depreciation 7,476 7,019
Equity in Earnings of Affiliates 155 199
Restructuring, severance and other charges - -
-------- --------
ADJUSTED EBITDA $26,356 $19,430
======== ========
Six Months Ended
June 30,
-----------------
2004 2003
-------- --------
NET INCOME (LOSS) 9,545 (6,531)
Net Interest Expense 18,221 18,254
Income Taxes 5,308 (1,160)
Refinancing Costs - 11,257
Equity in Earnings of Affiliates (293) (379)
Other Expense, Net 1,537 503
-------- --------
INCOME FROM OPERATIONS 34,318 21,944
Depreciation 13,772 13,875
Equity in Earnings of Affiliates 293 379
Restructuring, severance and other charges 240 -
-------- --------
ADJUSTED EBITDA $48,623 $36,198
======== ========
a) For the six months ending June 30, 2004, Adjusted EBITDA represents
income from operations plus depreciation plus equity in earnings
of affiliates, plus (i) $0.2 million for costs associated with the
fire damage and resulting business interruption sustained at our
facility in Cuyahoga Falls, Ohio in August 2003. Item (i) effected
gross profit.
b) Adjusted EBITDA is not intended to represent cash flow as defined
by generally accepted accounting principles ("GAAP") and should
not be considered as an indicator of cash flow from operations.
Adjusted EBITDA represents income from operations plus
depreciation plus equity in earnings of affiliates plus
non-recurring items. However, other companies may calculate
Adjusted EBITDA differently. Accuride has included information
concerning Adjusted EBITDA in this press release because
Accuride's management and our board of directors use it as measure
of our performance to internal business plans to which a
significant portion of management incentive programs are based. In
addition, future investment and capital allocation decisions are
based on Adjusted EBITDA. Investors and industry analysts use
Adjusted EBITDA to measure the Company's performance to historic
results and to the Company's peer group. The Company has
historically provided the measure in previous press releases and
believes it provides transparency and continuity to investors for
comparable purposes. Certain financial covenants in our borrowing
arrangements are tied to similar measures. Adjusted EBITDA margin
represents Adjusted EBITDA as a percentage of net sales.