UNITED STATES

OMB APPROVAL

 

SECURITIES AND EXCHANGE
COMMISSION

OMB Number: 3235-0060
Expires: March 31, 2006
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Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported)  July 31, 2008

 

TRIMAS CORPORATION

(Exact name of registrant as specified in its charter)

 

Delaware

 

001-10716

 

38-2687639

(State or other jurisdiction

 

(Commission

 

(IRS Employer

of incorporation)

 

File Number)

 

Identification No.)

 

 

 

 

 

39400 Woodward Avenue, Suite 130, Bloomfield Hills, Michigan

 

48304

(Address of principal executive offices)

 

(Zip Code)

 

Registrant’s telephone number, including area code (248) 631-5400

 

Not Applicable

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 



 

Item 2.02  Results of Operations and Financial Condition.

 

TriMas Corporation (the “Corporation”) issued a press release and held a teleconference on July 31, 2008, reporting its financial results for the second quarter ending June 30, 2008.  A copy of the press release and teleconference visual presentation are attached hereto as exhibits and are incorporated herein by reference.  The press release and teleconference visual presentation are also available on the Corporation’s website at www.trimascorp.com.

 

The information furnished pursuant to this Item 2.02, including Exhibits 99.1 and 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Corporation under the Securities Act of 1933 or the Exchange Act.

 

Item 9.01  Financial Statements and Exhibits.

 

(c)            Exhibits. The following exhibits are furnished herewith:

 

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Exhibit No.

 

Description

 

 

 

99.1

 

Press Release

 

 

 

99.2

 

The Corporation’s visual presentation titled “Second Quarter 2008 Earnings Presentation”

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

 

TRIMAS CORPORATION

 

 

 

 

 

 

Date:

July 31, 2008

 

By:

/s/ Grant H. Beard

 

 

Name:

Grant H. Beard

 

 

Title:

Chief Executive Officer

 

4


Exhibit 99.1

 

 

For more information, contact:

Sherry Lauderback

VP, Investor Relations & Communications

(248) 631-5506

sherrylauderback@trimascorp.com

 

FOR IMMEDIATE RELEASE

 

TRIMAS CORPORATION REPORTS SECOND QUARTER 2008 RESULTS

 

Company Achieves Record Quarterly Sales

 

BLOOMFIELD HILLS, Michigan, July 31, 2008 – TriMas Corporation (NYSE: TRS) today announced financial results for the quarter ended June 30, 2008. The Company reported record quarterly revenues from continuing operations of $297.1 million, an increase of 3.3% from the second quarter of 2007. Second quarter 2008 income from continuing operations was $9.4 million, or $0.28 diluted earnings per share, including $0.04 per share in previously announced restructuring costs. In comparison, the second quarter 2007 net loss from continuing operations was $4.1 million, or a loss of $0.15 per diluted share, which included the $0.52 per share impact of costs and expenses related to use of the initial public offering proceeds. The Company reported net cash provided by operating activities, net of acquisition impact, of $13.6 million in the second quarter of 2008, compared to net cash used for operating activities of $1.0 million in the second quarter of 2007.

 

SECOND QUARTER RESULTS – From Continuing Operations

 

·      TriMas reported record second quarter sales of $297.1 million, up 3.3% in comparison to $287.7 million in the second quarter 2007. Sales in the Packaging Systems, Energy Products and Industrial Specialties segments increased 1.3%, 29.6% and 6.4%, respectively. Sales in the RV & Trailer Products and Recreational Accessories segments declined 6.3% and 4.1%, respectively, due to lower demand as a result of reduced consumer discretionary spending and current economic conditions in the United States.

 

·      The Company reported operating profit of $29.9 million for the second quarter 2008, in comparison to operating profit of $20.4 million in the second quarter 2007. Excluding the Special Items(1) detailed in Appendix II for both periods, second quarter 2008 operating profit would have been $32.1 million, as compared to $34.6 million in second quarter 2007. This decrease between years resulted primarily from demand declines in the businesses serving the recreational vehicle and trailer-related end markets.

 

·      Adjusted EBITDA(2) for the second quarter 2008 was $39.4 million, as compared to $28.9 million in the second quarter 2007. Excluding the impact of the Special Items(1), second quarter 2008 Adjusted EBITDA(2) would have been $41.7 million, as compared to $43.1 million in the second quarter 2007, consistent with the decline in operating profit.

 

·      The Company reported income from continuing operations of $9.4 million in the second quarter 2008, or $0.28 per diluted share, compared to a loss from continuing operations of $4.1 million, or $0.15 per diluted share in the second quarter 2007. Excluding the impact of Special Items(1), second quarter 2008 income from continuing operations would have improved 12.8% to $10.8 million, as compared to $9.6 million in the second quarter 2007.

 

1



 

·      The Company reduced total indebtedness, including amounts utilized under its receivables securitization facility, by $23.4 million from March 31, 2008 to June 30, 2008. Aggregate availability under the Company’s revolving credit and receivables securitization facilities was $143.9 million as of June 30, 2008.

 


(1)      In evaluating the quality of the Company’s operating performance, management considers Adjusted EBITDA, among other metrics, as a key indicator of financial operating performance together with a careful review of results reported under GAAP. Appendix II details certain one-time costs, expenses and other charges, collectively described as “Special Items,” that are included in the determination of net income (loss) under GAAP and are not added back to net income (loss) in determining Adjusted EBITDA, but that management would consider important in evaluating the quality of the Company’s Adjusted EBITDA and operating results under GAAP.

 

(2)      See Appendix I for reconciliation of Non-GAAP financial measure Adjusted EBITDA to the Company’s reported results of operations prepared in accordance with GAAP.

 

“In light of the current economic environment, our performance during the second quarter met our expectations,” said Grant H. Beard, TriMas’ President and Chief Executive Officer. “The diversity of our businesses and end markets remains a strength as the United States faces challenging economic times. During the quarter, our Energy Products segment reported significant growth in sales and operating profit of 29.6% and 51.8%, respectively, as a result of increased demand and new product introductions. Sales in our Industrial Specialties segment increased 6.4%, led by growth in our aerospace fastener business, while our Packaging Systems segment was up slightly compared to the prior year quarter. The Packaging Systems, Energy Products and Industrial Specialties segments collectively generated 77.4% of our segment operating profit during the quarter, and sales within this collection of businesses grew at a combined rate of 10.8% year over year.”

 

“Consistent with our first quarter results, our RV & Trailer Products and Recreational Accessories segments continue to face difficult end market conditions, resulting from the decline in consumer discretionary spending, consumer confidence and credit availability,” Beard continued. “While we estimate the end markets for these businesses are down approximately 15% to 20%, we believe we outperformed the market and our sales were down only 5%, as a result of market share gains, cross-selling, regional expansion and the introduction of new product content.”

 

“As we look forward across the remainder of 2008, we continue to execute pricing initiatives across our businesses to offset rising commodity costs,” Beard noted. “We expect continued weak end market demand within our RV & Trailer Products and Recreational Accessories businesses and have implemented actions in those businesses to reduce costs and decrease inventory to mitigate these economic pressures. We expect strength in our energy, aerospace and packaging businesses as we focus on launching new products and expanding geographically in growing end markets. We remain committed to aggressive cost reductions, working capital declines and the execution of pricing initiatives.”

 

2



 

Second Quarter Financial Summary

 

 

 

Three months ended
June 30,

 

Six months ended
June 30,

 

(unaudited - in thousands, except per share amounts)

 

2008

 

2007

 

2008

 

2007

 

Sales

 

$

297,080

 

$

287,670

 

$

576,640

 

$

572,110

 

Operating profit

 

$

29,850

 

$

20,380

 

$

57,960

 

$

52,670

 

Income (loss) from continuing operations

 

$

9,380

 

$

(4,060

)

$

17,170

 

$

3,690

 

Income from discontinued operations, net of income taxes

 

$

70

 

$

870

 

$

150

 

$

170

 

Net income (loss)

 

$

9,450

 

$

(3,190

)

$

17,320

 

$

3,860

 

Adjusted EBITDA(1), continuing operations

 

$

39,410

 

$

28,880

 

$

77,030

 

$

69,800

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) per share - basic:

 

 

 

 

 

 

 

 

 

- Continuing operations

 

$

0.28

 

$

(0.15

)

$

0.51

 

$

0.16

 

- Discontinued operations

 

 

0.03

 

 

 

- Net income

 

$

0.28

 

$

(0.12

)

$

0.51

 

$

0.16

 

Weighted average common shares - basic

 

33,409,500

 

26,223,236

 

33,409,500

 

23,506,461

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) per share - diluted:

 

 

 

 

 

 

 

 

 

- Continuing operations

 

$

0.28

 

$

(0.15

)

$

0.51

 

$

0.16

 

- Discontinued operations

 

 

0.03

 

 

 

- Net income

 

$

0.28

 

$

(0.12

)

$

0.51

 

$

0.16

 

Weighted average common shares - diluted

 

33,642,907

 

26,223,236

 

33,597,276

 

23,506,461

 

 

 

 

 

 

 

 

 

 

 

Other Data - Continuing Operations:

 

 

 

 

 

 

 

 

 

- Depreciation and amortization

 

$

10,900

 

$

9,570

 

$

21,600

 

$

19,360

 

- Interest expense

 

$

13,880

 

$

18,340

 

$

28,590

 

$

37,200

 

- Debt extinguishment costs

 

$

 

$

7,440

 

$

 

$

7,440

 

- Other expense, net

 

$

1,340

 

$

1,060

 

$

2,530

 

$

2,220

 

- Income tax expense (benefit)

 

$

5,250

 

$

(2,400

)

$

9,670

 

$

2,120

 

- Advisory Services Agreement termination fee

 

$

 

$

10,000

 

$

 

$

10,000

 

- Costs for early termination of operating leases

 

$

 

$

4,230

 

$

 

$

4,230

 

- Restructuring activities

 

$

2,260

 

$

 

$

2,260

 

$

 

 


(1) See Appendix I for reconciliation of Non-GAAP financial measure Adjusted EBITDA to the Company’s reported results of operations prepared in accordance with U.S. GAAP.

 

Second Quarter Segment Results – From Continuing Operations

 

Packaging Systems - Sales for the second quarter of 2008 increased 1.3% compared to the prior year. Sales of industrial closures and specialty dispensing products, which comprised the majority of the sales in this segment, increased 7.6% in the second quarter 2008 and benefited from the favorable effects of currency exchange and pricing initiatives. This increase was partially offset by a significant decline in laminate and insulation product sales resulting from a weakening commercial construction end market. Operating profit for the quarter declined due to volume declines in laminate and insulation products and additional expenses associated with growth initiatives. The Company continues to diversify its product offering by developing specialty dispensing product applications for growing end markets, including pharmaceutical, personal care and food/beverage markets, and expanding geographically to generate long-term growth.

 

Energy Products - Sales increased 29.6% for the second quarter due to strong market demand and continued high utilization rates of refinery and petrochemical facilities. These trends, combined with the Company’s initiatives to service this market growth and gain additional share, resulted in increased

 

3



 

sales of engines and related parts, new compressors and gas production equipment products for use at well-sites, and specialty gaskets and related fastening hardware for the refinery and petrochemical industries. Operating profit for the quarter increased 51.8%, in line with higher sales volumes and as a result of favorable cost leverage. The Company plans to continue to launch new products to complement its engine business, while expanding its gasket business internationally.

 

Industrial Specialties - Sales for the second quarter increased 6.4% due to increased demand, most notably in the aerospace fastener business resulting from market share gains and strong overall market demand. This segment also benefited from sales growth in the industrial cylinder and defense businesses, and the August 2007 acquisition of a medical device manufacturer. Operating profit for the quarter increased slightly as the benefits of higher sales volumes were partially offset by increased expenditures to invest in growth initiatives and lower absorption of fixed costs in the specialty fittings business, as a result of lower production volumes. The Company plans to drive growth in this segment by developing specialty products for growing end markets such as medical and aerospace, while continuing to expand international sales efforts.

 

RV & Trailer Products - Sales for the second quarter declined a net 6.3%, as sales growth in the Australian business was more than offset by the continued weak demand in most end markets in the United States. Operating profit decreased 65.7% due to reduced sales volumes and lower absorption of fixed costs as the Company reduced its production to manage inventory levels, combined with a less favorable product sales mix. The Company’s focus in this segment is to aggressively manage costs and to leverage strong brand positions for increased market share, cross-sell the product portfolio into all channels and expand internationally.

 

Recreational Accessories - Sales decreased 4.1% for the second quarter, as the Company continued to experience weak consumer demand for towing accessories. Operating profit declined 11.8% as a result of lower sales volumes. The Company plans to continue to manage costs, increase market share in the United States and Canada, and pursue new market opportunities in select international markets.

 

Financial Position

 

The Company reduced total indebtedness, including amounts outstanding under its receivables securitization facility, by $23.4 million from March 31, 2008 to June 30, 2008. TriMas ended the quarter with total debt of $616.4 million and funding under its receivables securitization facility of $33.0 million for a total of $649.4 million. TriMas ended the quarter with cash of $6.9 million and $143.9 million of aggregate availability under its revolving credit and receivables securitization facilities.

 

Outlook

 

In its March 13, 2008 fourth quarter earnings release, TriMas provided a full year 2008 diluted earnings per share from continuing operations guidance range of $0.85 to $0.95 per share. The Company also provided a full year 2008 net income from continuing operations range of $28.5 million to $31.9 million. Second quarter results met the Company’s expectations, and 2008 guidance remains as previously announced, excluding the second quarter Special Items of $0.04 per diluted share related to charges associated with restructuring and cost reduction initiatives.

 

This outlook does not include the impact of any future unidentified restructuring charges and divestitures or acquisitions of operating assets that may occur from time to time due to management decisions and changing business circumstances. The outlook above also does not include the impact of

 

4



 

any potential future non-cash impairment charges of goodwill, intangibles and fixed assets. This outlook also excludes benefit costs related to contractual obligations to Metaldyne or discontinued operations. The Company is currently unable to forecast the likelihood of occurrence, timing and/or magnitude of any such amounts or events. See also “Cautionary Notice Regarding Forward-Looking Statements” below.

 

Conference Call Information

 

TriMas Corporation will host its second quarter 2008 earnings conference call today, Thursday, July 31, 2008 at 10:00 a.m. EDT. The call-in number is (866) 227-1607. Participants should request to be connected to the TriMas Corporation second quarter conference call (conference ID number 1267252). The presentation that will accompany the call will be available on the Company’s website at www.trimascorp.com prior to the call.

 

The conference call will also be webcast simultaneously on the Company’s website at www.trimascorp.com. A replay of the conference call will be available on the TriMas website or by dialing (866) 837-8032 (passcode 1267252) beginning July 31st at 1:00 p.m. EDT through August 7th at 11:59 p.m. EDT.

 

Cautionary Notice Regarding Forward-looking Statements

 

This release contains “forward-looking” statements, as that term is defined by the federal securities laws, about our financial condition, results of operations and business.  Forward-looking statements include: certain anticipated, believed, planned, forecasted, expected, targeted and estimated results along with TriMas’ outlook concerning future results.  When used in this release, the words “estimates,” “expects,” “anticipates,” “projects,” “plans,” “intends,” “believes,” “forecasts,” or future or conditional verbs, such as “will,” “should,” “could,” or “may,” and variations of such words or similar expressions are intended to identify forward-looking statements.  All forward-looking statements, including without limitation, management’s examination of historical operating trends and data, are based upon our current expectations and various assumptions.  Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for these views.  However, there can be no assurance that management’s expectations, beliefs and projections will be achieved.  These forward-looking statements are subject to numerous assumptions, risks and uncertainties and accordingly, actual results may differ materially from those expressed or implied by the forward-looking statements.  We caution readers not to place undue reliance on the statements, which speak to conditions only as of the date of this release.  The cautionary statements set forth above should be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue.  We do not undertake any obligation to review or confirm analysts’ expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.  Risks and uncertainties that could cause actual results to vary materially from those anticipated in the forward-looking statements included in this release include general economic conditions in the markets in which we operate and industry-based factors such as: technological developments that could competitively disadvantage us, increases in our raw material, energy, and healthcare costs, our dependence on key individuals and relationships, exposure to product liability, recall and warranty claims, compliance with environmental and other regulations, and competition within our industries.  In addition, factors more specific to us could cause actual results to vary materially from those anticipated in the forward-looking statements included in this release such as our substantial leverage, limitations imposed by our debt instruments, our ability to successfully pursue our stated growth strategies and opportunities, as well as our ability to identify attractive and other

 

5



 

strategic acquisition opportunities and to successfully integrate acquired businesses and complete actions we have identified as providing cost-saving opportunities.

 

About TriMas

 

Headquartered in Bloomfield Hills, Michigan, TriMas Corporation is a diversified growth company of specialty niche businesses manufacturing a variety of highly engineered products for commercial, industrial and consumer markets worldwide. TriMas is organized into five strategic business segments: Packaging Systems, Energy Products, Industrial Specialties, RV & Trailer Products and Recreational Accessories. TriMas has approximately 5,000 employees at 70 different facilities in 10 countries. For more information, visit www.trimascorp.com.

 

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TriMas Corporation
Consolidated Balance Sheet
(Unaudited — dollars in thousands)

 

 

 

June 30,

 

December 31,

 

 

 

2008

 

2007

 

Assets

 

 

 

 

 

Current assets:

 

 

 

 

 

Cash and cash equivalents

 

$

6,860

 

$

4,800

 

Receivables, net

 

127,470

 

89,370

 

Inventories, net

 

186,200

 

190,590

 

Deferred income taxes

 

18,860

 

18,860

 

Prepaid expenses and other current assets

 

6,280

 

7,010

 

Assets of discontinued operations held for sale

 

2,760

 

3,330

 

Total current assets

 

348,430

 

313,960

 

Property and equipment, net

 

197,840

 

195,120

 

Goodwill

 

384,270

 

377,340

 

Other intangibles, net

 

209,320

 

214,290

 

Other assets

 

25,250

 

27,280

 

Total assets

 

$

1,165,110

 

$

1,127,990

 

 

 

 

 

 

 

Liabilities and Shareholders’ Equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

Current maturities, long-term debt

 

$

9,900

 

$

8,390

 

Accounts payable

 

140,440

 

121,860

 

Accrued liabilities

 

63,950

 

71,830

 

Liabilities of discontinued operations

 

1,170

 

1,450

 

Total current liabilities

 

215,460

 

203,530

 

Long-term debt

 

606,500

 

607,600

 

Deferred income taxes

 

73,950

 

73,280

 

Other long-term liabilities

 

35,630

 

35,090

 

Total liabilities

 

931,540

 

919,500

 

Preferred stock $0.01 par: Authorized 100,000,000 shares; Issued and outstanding: None

 

 

 

Common stock, $0.01 par: Authorized 400,000,000 shares; Issued and outstanding:
33,409,500 shares at June 30, 2008 and December 31, 2007, respectively

 

330

 

330

 

Paid-in capital

 

526,840

 

525,960

 

Accumulated deficit

 

(356,650

)

(373,970

)

Accumulated other comprehensive income

 

63,050

 

56,170

 

Total shareholders’ equity

 

233,570

 

208,490

 

Total liabilities and shareholders’ equity

 

$

1,165,110

 

$

1,127,990

 

 

7



 

TriMas Corporation
Consolidated Statement of Operations
 (Unaudited — dollars in thousands, except for share amounts)

 

 

 

Three months ended

 

Six months ended

 

 

 

June 30,

 

June 30,

 

 

 

2008

 

2007

 

2008

 

2007

 

Net sales

 

$

297,080

 

$

287,670

 

$

576,640

 

$

572,110

 

Cost of sales

 

(218,330

)

(208,020

)

(424,550

)

(414,460

)

Gross profit

 

78,750

 

79,650

 

152,090

 

157,650

 

Selling, general and administrative expenses

 

(48,790

)

(45,320

)

(93,910

)

(90,860

)

Advisory services agreement termination fee

 

 

(10,000

)

 

(10,000

)

Costs for early termination of operating leases

 

 

(4,230

)

 

(4,230

)

Gain (loss) on dispositions of property and equipment

 

(110

)

280

 

(220

)

110

 

Operating profit

 

29,850

 

20,380

 

57,960

 

52,670

 

Other expense, net:

 

 

 

 

 

 

 

 

 

Interest expense

 

(13,880

)

(18,340

)

(28,590

)

(37,200

)

Debt extinguishment costs

 

 

(7,440

)

 

(7,440

)

Other, net

 

(1,340

)

(1,060

)

(2,530

)

(2,220

)

Other expense, net

 

(15,220

)

(26,840

)

(31,120

)

(46,860

)

 

 

 

 

 

 

 

 

 

 

Income (loss) from continuing operations before income tax benefit (expense)

 

14,630

 

(6,460

)

26,840

 

5,810

 

Income tax benefit (expense)

 

(5,250

)

2,400

 

(9,670

)

(2,120

)

Income (loss) from continuing operations

 

9,380

 

(4,060

)

17,170

 

3,690

 

Income from discontinued operations, net of income tax benefit

 

70

 

870

 

150

 

170

 

Net income (loss)

 

$

9,450

 

$

(3,190

)

$

17,320

 

$

3,860

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) per share - basic:

 

 

 

 

 

 

 

 

 

Continuing operations

 

$

0.28

 

$

(0.15

)

$

0.51

 

$

0.16

 

Discontinued operations, net of income tax expense

 

 

0.03

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share

 

$

0.28

 

$

(0.12

)

$

0.51

 

$

0.16

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares - basic

 

33,409,500

 

26,223,236

 

33,409,500

 

23,506,461

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) per share - diluted:

 

 

 

 

 

 

 

 

 

Continuing operations

 

$

0.28

 

$

(0.15

)

$

0.51

 

$

0.16

 

Discontinued operations, net of income tax expense

 

 

0.03

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per share

 

$

0.28

 

$

(0.12

)

$

0.51

 

$

0.16

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares - diluted

 

33,642,907

 

26,223,236

 

33,597,276

 

23,506,461

 

 

8



 

TriMas Corporation
Consolidated Statement of Cash Flows
(Unaudited — dollars in thousands)

 

 

 

Six months ended

 

 

 

June 30,

 

 

 

2008

 

2007

 

Net income

 

$

 17,320

 

$

 3,860

 

Adjustments to reconcile net income to net cash provided by operating activities, net of acquisition impact:

 

 

 

 

 

Loss on dispositions of property and equipment

 

90

 

70

 

Depreciation

 

13,900

 

11,660

 

Amortization of intangible assets

 

7,800

 

7,800

 

Amortization of debt issue costs

 

1,220

 

3,970

 

Deferred income taxes

 

 

770

 

Non-cash compensation expense

 

880

 

120

 

Net proceeds from (reductions in) sale of receivables and receivables securitization

 

(3,630

)

33,330

 

Increase in receivables

 

(33,290

)

(48,230

)

(Increase) decrease in inventories

 

4,950

 

(7,850

)

Decrease in prepaid expenses and other assets

 

1,910

 

2,630

 

Increase in accounts payable and accrued liabilities

 

10,090

 

16,500

 

Other, net

 

2,020

 

1,310

 

Net cash provided by operating activities, net of acquisition impact

 

23,260

 

25,940

 

 

 

 

 

 

 

Cash Flows from Investing Activities:

 

 

 

 

 

Capital expenditures

 

(13,530

)

(14,860

)

Acquisition of leased assets

 

 

(29,960

)

Acquisition of businesses, net of cash acquired

 

(6,190

)

 

Net proceeds from disposition of businesses and other assets

 

340

 

5,850

 

Net cash used for investing activities

 

(19,380

)

(38,970

)

 

 

 

 

 

 

Cash Flows from Financing Activities:

 

 

 

 

 

Proceeds from sale of common stock in connection with the Company’s initial public offering, net of issuance costs

 

 

126,460

 

Repayments of borrowings on senior credit facilities

 

(2,930

)

(1,730

)

Proceeds from borrowings on term loan facilities

 

490

 

 

Proceeds from borrowings on revolving credit facilities

 

269,200

 

248,370

 

Repayments of borrowings on revolving credit facilities

 

(268,580

)

(260,950

)

Retirement of senior subordinated notes

 

 

(100,000

)

Net cash (used for) provided by financing activities

 

(1,820

)

12,150

 

 

 

 

 

 

 

Cash and Cash Equivalents:

 

 

 

 

 

Increase (decrease) for the period

 

2,060

 

(880

)

At beginning of period

 

4,800

 

3,600

 

At end of period

 

$

6,860

 

$

2,720

 

 

 

 

 

 

 

Supplemental disclosure of cash flow information:

 

 

 

 

 

Cash paid for interest

   

$

27,100

 

$

34,510

 

Cash paid for taxes

 

$

5,330

 

$

5,010

 

 

9



 

TriMas Corporation
 Company and Business Segment Financial Information

Continuing Operations
(Unaudited — dollars in thousands)

 

 

 

Three months ended

 

Six months ended

 

 

 

June 30,

 

June 30,

 

 

 

2008

 

2007

 

2008

 

2007

 

Packaging Systems

 

 

 

 

 

 

 

 

 

Net sales

 

$

57,410

 

$

56,700

 

$

111,980

 

$

110,450

 

Operating profit

 

$

9,150

 

$

10,820

 

$

18,030

 

$

19,820

 

Operating profit as a % of sales

 

15.9

%

19.1

%

16.1

%

17.9

%

 

 

 

 

 

 

 

 

 

 

Energy Products

 

 

 

 

 

 

 

 

 

Net sales

 

$

53,160

 

$

41,020

 

$

101,960

 

$

82,600

 

Operating profit

 

$

8,590

 

$

5,660

 

$

16,500

 

$

12,070

 

Operating profit as a % of sales

 

16.2

%

13.8

%

16.2

%

14.6

%

 

 

 

 

 

 

 

 

 

 

Industrial Specialties

 

 

 

 

 

 

 

 

 

Net sales

 

$

56,210

 

$

52,850

 

$

109,680

 

$

103,440

 

Operating profit

 

$

11,480

 

$

11,220

 

$

22,640

 

$

22,440

 

Operating profit as a % of sales

 

20.4

%

21.2

%

20.6

%

21.7

%

 

 

 

 

 

 

 

 

 

 

RV & Trailer Products

 

 

 

 

 

 

 

 

 

Net sales

 

$

49,730

 

$

53,070

 

$

100,400

 

$

106,480

 

Operating profit

 

$

2,060

 

$

6,010

 

$

4,810

 

$

12,470

 

Operating profit as a % of sales

 

4.1

%

11.3

%

4.8

%

11.7

%

 

 

 

 

 

 

 

 

 

 

Recreational Accessories

 

 

 

 

 

 

 

 

 

Net sales

 

$

80,570

 

$

84,030

 

$

152,620

 

$

169,140

 

Operating profit

 

$

6,490

 

$

7,360

 

$

9,120

 

$

12,500

 

Operating profit as a % of sales

 

8.1

%

8.8

%

6.0

%

7.4

%

 

 

 

 

 

 

 

 

 

 

Corporate Expenses and Management Fees

 

$

(7,920

)

$

(20,690

)

$

(13,140

)

$

(26,630

)

 

 

 

 

 

 

 

 

 

 

Total Company

 

 

 

 

 

 

 

 

 

Net sales

 

$

297,080

 

$

287,670

 

$

576,640

 

$

572,110

 

Operating profit

 

$

29,850

 

$

20,380

 

$

57,960

 

$

52,670

 

Operating profit as a % of sales

 

10.0

%

7.1

%

10.1

%

9.2

%

 

 

 

 

 

 

 

 

 

 

Other Data:

 

 

 

 

 

 

 

 

 

- Depreciation and amortization

 

$

10,900

 

$

9,570

 

$

21,600

 

$

19,360

 

 

 

 

 

 

 

 

 

 

 

- Interest expense

 

$

13,880

 

$

18,340

 

$

28,590

 

$

37,200

 

 

 

 

 

 

 

 

 

 

 

- Debt extinguishment costs

 

$

 

$

7,440

 

$

 

$

7,440

 

 

 

 

 

 

 

 

 

 

 

- Other expense, net

 

$

1,340

 

$

1,060

 

$

2,530

 

$

2,220

 

 

 

 

 

 

 

 

 

 

 

- Income tax expense (benefit)

 

$

5,250

 

$

(2,400

)

$

9,670

 

$

2,120

 

 

 

 

 

 

 

 

 

 

 

- Advisory Services Agreement termination fee

 

$

 

$

10,000

 

$

 

$

10,000

 

 

 

 

 

 

 

 

 

 

 

- Costs for early termination of operating leases

 

$

 

$

4,230

 

$

 

$

4,230

 

 

 

 

 

 

 

 

 

 

 

- Restructuring activities

 

$

2,260

 

$

 

$

2,260

 

$

 

 

10



 

Appendix I

 

TriMas Corporation

Reconciliation of Non-GAAP Measure Adjusted EBITDA

(Unaudited – dollars in thousands)

 

 

 

Three months ended

 

Six months ended

 

 

 

June 30,

 

June 30,

 

 

 

2008

 

2007

 

2008

 

2007

 

Net income (loss)

 

$

9,450

 

$

(3,190

)

$

17,320

 

$

3,860

 

Income tax expense (benefit)

 

5,270

 

(1,870

)

9,750

 

3,110

 

Interest expense

 

13,930

 

18,340

 

28,690

 

37,200

 

Debt extinguishment costs

 

 

7,440

 

 

7,440

 

Depreciation and amortization

 

10,950

 

9,620

 

21,700

 

19,460

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA(1), total company

 

39,600

 

30,340

 

77,460

 

71,070

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA(1), discontinued operations

 

190

 

1,460

 

430

 

1,270

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA(1), continuing operations

 

$

39,410

 

$

28,880

 

$

77,030

 

$

69,800

 

 


(1)The Company defines Adjusted EBITDA as net income (loss) before cumulative effect of accounting change, interest, taxes, depreciation, amortization, non-cash asset and goodwill impairment write-offs, and non-cash losses on sale-leaseback of property and equipment.  Lease expense and non-recurring charges are included in Adjusted EBITDA and include both cash and non-cash charges related to restructuring and integration expenses.  In evaluating our business, management considers and uses Adjusted EBITDA as a key indicator of financial operating performance and as a measure of cash generating capability.  Management believes this measure is useful as an analytical indicator of leverage capacity and debt servicing ability, and uses it to measure financial performance as well as for planning purposes.  However, Adjusted EBITDA should not be considered as an alternative to net income, cash flow from operating activities or any other measures calculated in accordance with U.S. GAAP, or as an indicator of operating performance.  The definition of Adjusted EBITDA used here may differ from that used by other companies.

 

11



 

Appendix II

 

TriMas Corporation

Additional Information Regarding Special Items Impacting

Reported GAAP Financial Measures

 

 

 

Three months ended

 

Three months ended

 

 

 

June 30, 2008

 

June 30, 2007

 

(dollars in thousands, except per share amounts)

 

Income
(Loss)

 

EPS

 

Income
(Loss)

 

EPS

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) and Diluted EPS from continuing operations, as reported

 

$

9,380

 

$

0.28

 

$

(4,060

)

$

(0.15

)

 

 

 

 

 

 

 

 

 

 

After-tax impact of Special Items to consider in evaluating quality of income (loss) and diluted EPS from continuing operations:

 

 

 

 

 

 

 

 

 

Advisory services agreement termination fee

 

$

 

$

 

$

(6,300

)

$

(0.24

)

Costs for early termination of operating leases

 

 

 

(2,660

)

(0.10

)

Debt extinguishment costs

 

 

 

(4,690

)

(0.18

)

Restructuring activities

 

(1,440

)

(0.04

)

 

 

 

 

 

 

 

 

 

 

 

 

Total Special Items

 

$

(1,440

)

$

(0.04

)

$

(13,650

)

$

(0.52

)

 

 

 

 

 

 

 

 

 

 

Weighted-average diluted shares outstanding at June 30, 2008 and 2007

 

 

 

33,642,907

 

 

 

26,223,236

 

 

 

 

Six months ended

 

Six months ended

 

 

 

June 30, 2008

 

June 30, 2007

 

(dollars in thousands, except per share amounts)

 

Income

 

EPS

 

Income

 

EPS

 

 

 

 

 

 

 

 

 

 

 

Income and Diluted EPS from continuing operations, as reported

 

$

17,170

 

$

0.51

 

$

3,690

 

$

0.16

 

 

 

 

 

 

 

 

 

 

 

After-tax impact of Special Items to consider in evaluating quality of income and diluted EPS from continuing operations:

 

 

 

 

 

 

 

 

 

Advisory services agreement termination fee

 

$

 

$

 

$

(6,300

)

$

(0.27

)

Costs for early termination of operating leases

 

 

 

(2,660

)

(0.11

)

Debt extinguishment costs

 

 

 

(4,690

)

(0.20

)

Restructuring activities

 

(1,440

)

(0.04

)

 

 

 

 

 

 

 

 

 

 

 

 

Total Special Items

 

$

(1,440

)

$

(0.04

)

$

(13,650

)

$

(0.58

)

 

 

 

 

 

 

 

 

 

 

Weighted-average diluted shares outstanding at June 30, 2008 and 2007

 

 

 

33,597,276

 

 

 

23,506,461

 

 

12



 

 

 

Three months ended

 

Six months ended

 

 

 

June 30,

 

June 30,

 

(dollars in thousands)

 

2008

 

2007

 

2008

 

2007

 

 

 

 

 

 

 

 

 

 

 

Operating profit from continuing operations, as reported

 

$

29,850

 

$

20,380

 

$

57,960

 

$

52,670

 

 

 

 

 

 

 

 

 

 

 

Special Items to consider in evaluating quality of earnings:

 

 

 

 

 

 

 

 

 

Advisory services agreement termination fee

 

$

 

$

(10,000

)

$

 

$

(10,000

)

Costs for early termination of operating leases

 

 

(4,230

)

 

(4,230

)

Restructuring activities

 

(2,260

)

 

(2,260

)

 

 

 

 

 

 

 

 

 

 

 

Total Special Items

 

$

(2,260

)

$

(14,230

)

$

(2,260

)

$

(14,230

)

 

 

 

Three months ended

 

Six months ended

 

 

 

June 30,

 

June 30,

 

(dollars in thousands)

 

2008

 

2007

 

2008

 

2007

 

 

 

 

 

 

 

 

 

 

 

Adjusted EBITDA from continuing operations, as reported

 

$

39,410

 

$

28,880

 

$

77,030

 

$

69,800

 

 

 

 

 

 

 

 

 

 

 

Special Items to consider in evaluating quality of earnings:

 

 

 

 

 

 

 

 

 

Advisory services agreement termination fee

 

$

 

$

(10,000

)

$

 

$

(10,000

)

Costs for early termination of operating leases

 

 

(4,230

)

 

(4,230

)

Restructuring activities

 

(2,260

)

 

(2,260

)

 

 

 

 

 

 

 

 

 

 

 

Total Special Items

 

$

(2,260

)

$

(14,230

)

$

(2,260

)

$

(14,230

)

 

13


Exhibit 99.2

 

GRAPHIC

1 Second Quarter 2008 Earnings Presentation July 31, 2008

 


GRAPHIC

2 This document contains “forward-looking” statements, as that term is defined by the federal securities laws, about our financial condition, results of operations and business. Forward-looking statements include certain anticipated, believed, planned, forecasted, expected, targeted and estimated results along with TriMas’ outlook concerning future results. The words “estimates,” “expects,” “anticipates,” “projects,” “plans,” “intends,” “believes,” “forecasts,” or future or conditional verbs, such as “will,” “should,” “could,” or “may,” and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements, including, without limitation, management’s examination of historical operating trends and data are based upon our current expectations and various assumptions. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that management’s expectations, beliefs and projections will be achieved. These forward-looking statements are subject to numerous assumptions, risks and uncertainties and accordingly, actual results may differ materially from those expressed or implied by the forward-looking statements. We caution readers not to place undue reliance on the statements, which speak only as of the date of this document. The cautionary statements set forth above should be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue. We do not undertake any obligation to review or confirm analysts’ expectations or estimates or to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events. Risks and uncertainties that could cause actual results to vary materially from those anticipated in the forward-looking statements included in this document include general economic conditions in the markets in which we operate and industry-based factors such as: technological developments that could competitively disadvantage us, increases in our raw material, energy, and healthcare costs, our dependence on key individuals and relationships, exposure to product liability, recall and warranty claims, work stoppages at our facilities, or our customers or suppliers, risks associated with international markets, protection of or liability associated with our intellectual property, lower cost foreign manufacturers, compliance with environmental and other regulations, and competition within our industries. In addition, factors more specific to us could cause actual results to vary materially from those anticipated in the forward-looking statements included in this document such as our substantial leverage, limitations imposed by our debt instruments, our ability to successfully pursue our stated growth strategies and opportunities, including our ability to identify attractive and other strategic acquisition opportunities and to successfully integrate acquired businesses and complete actions we have identified as providing cost-saving opportunities. Safe Harbor Statement

 


GRAPHIC

3 Agenda Second Quarter 2008 Results Segment Highlights Financial Highlights and Outlook Questions and Answers Appendix

 


GRAPHIC

4 Second Quarter 2008 Results

 


GRAPHIC

5 Overview Solid performance in a difficult environment - Delivered Q2-2008 EPS from continuing ops of $0.28 - Continued improvement in balance sheet Aggressive structural cost reduction - Restructuring and other charges of $0.04 per share (Excluding these amounts, Q2-2008 EPS would have been $0.32 per diluted share) - Continued cost-out and operational improvement focus Solid growth in energy, aerospace and specialty packaging businesses - Packaging Systems, Energy Products and Industrial Specialties combined sales increased 10.8% Strong relative performance in RV & Trailer Products and Recreational Accessories - Sales declined 5.0%, but end markets down 15% to 20% Business model intact and business fundamentals strong - Positioned for long-term growth - Growth initiatives driving channel, geographic and end market diversity

 


GRAPHIC

6 2008 Second Quarter Results Record quarterly sales of $297.1 million Excluding Special Items(1), Adjusted EBITDA would have declined primarily due to the demand declines in RV&T and Recreational Accessories segments Net income improved 12.8%, excluding the impact of Special Items(1) Net cash provided by operating activities increased substantially in the quarter Total indebtedness decreased by $21.3 million Aggregate availability under revolving credit and receivables securitization facilities was $143.9 at quarter end ($ in millions, except EPS) (from continuing operations) Q2 2008 Q2 2007 % Change Revenue 297.1 $ 287.7 $ 3.3% Adjusted EBITDA 39.4 $ 28.9 $ 36.5% Excl. Special Items, (1) Adjusted EBITDA would have been: 41.7 $ 43.1 $ -3.3% Net Income (Loss) 9.5 $ (4.1) $ Excl. Special Items, (1) Net Income would have been: 10.8 $ 9.6 $ 12.8% Diluted EPS 0.28 $ (0.15) $ Excl. Special Items, (1) Diluted EPS would have been: 0.32 $ 0.37 $ -13.5% Net cash provided by (used for) operating activities 13.6 $ (1.0) $ Debt and AR Securitization 649.4 $ 670.7 $ -3.2% (1) Special Items to consider in evaluating quality of earnings include $2.3 million of restructuring charges in Q2-2008 and $14.2 million in costs and expenses related to the use of IPO proceeds in Q2-2007. Please see slides 27 and 28 for additional information regarding these Special Items.

 


GRAPHIC

7 Segment Highlights

 


GRAPHIC

8 Packaging Systems Sales of core industrial closure products and specialty dispensing products to pharmaceutical, food/beverage and personal care end markets were up 7.6% year-over-year and benefited from the favorable effects of price increases and currency exchange Laminate and insulation product sales were down substantially due to the continued weakness in North American commercial construction markets Adjusted EBITDA and operating profit decreased due to volume declines in laminate and insulation products (under-absorption of fixed costs) and additional expenses associated with growth initiatives Develop specialty dispensing product applications for growing end markets and expand geographically to drive growth Net Sales Adjusted EBITDA Operating Profit Q2 2008 Q2 2007 $14.1 $12.8 Q2 2008 Q2 2007 $10.8 $9.2 Q2 2008 Q2 2007 $56.7 $57.4 1.3% (9.4)% (15.4)% ($ in millions)

 


GRAPHIC

9 Energy Products New product initiatives to add content at the well-site and increased engine demand drove sales increases of engine and related products year-over-year Product expansion efforts, a superior service model and continued high levels of capacity utilization increased specialty gasket sales to refinery and petrochemical industries Adjusted EBITDA and operating profit improved with strong conversion Introduce additional products complementary to engine business – compressors and gas production equipment Further expand gasket business with major customers into Southeast Asia, Europe and South America Q2 2008 Q2 2007 $41.0 $53.2 Q2 2008 Q2 2007 $6.3 $9.2 Q2 2008 Q2 2007 $5.7 $8.6 29.6% 46.8% 51.8% ($ in millions) Net Sales Adjusted EBITDA Operating Profit

 


GRAPHIC

10 Industrial Specialties Q2 2008 Q2 2007 $52.9 $56.2 Q2 2008 Q2 2007 $12.4 $13.0 Q2 2008 Q2 2007 $11.2 $11.5 6.4% 4.9% ($ in millions) Net Sales Adjusted EBITDA Operating Profit Sales of aerospace fasteners were robust due to the introduction of new products and a strong market – currently there is a record backlog of demand International initiatives drove growth of industrial cylinders Specialty fittings business experienced a softening driven by reduced automotive demand Adjusted EBITDA and operating profit increased due to higher sales volumes - conversion was moderated by increased investments in growth initiatives and lower absorption of fixed costs in the specialty fittings business Develop specialty products for growing end markets such as medical and aerospace and continue to expand international sales efforts 2.3%

 


GRAPHIC

11 RV & Trailer Products Q2 2008 Q2 2007 $53.1 $49.7 Q2 2008 Q2 2007 $7.8 $3.9 Q2 2008 Q2 2007 $6.0 $2.1 (6.3)% (49.7)% (65.7)% ($ in millions) Net Sales Adjusted EBITDA Operating Profit Sales declined due to continued weak demand in U.S. end markets resulting from the decline in consumer discretionary spending, consumer confidence and credit availability - Outperformed the market - estimate end market demand down approx. 15% to 20% - Sales in Australia, Southeast Asia and Canada increased year-over-year Adjusted EBITDA and operating profit decreased due to the decline in sales, lower absorption of fixed costs and a less favorable product sales mix Continued aggressive cost and inventory management Drive growth by leveraging strong brand names for additional market share and introducing new products Cross-sell the product portfolio into all channels and expand internationally

 


GRAPHIC

12 Recreational Accessories Q2 2008 Q2 2007 $84.0 $80.6 Q2 2008 Q2 2007 $9.7 $8.9 Q2 2008 Q2 2007 $7.4 $6.5 (4.1)% (8.5)% (11.8)% ($ in millions) Net Sales Adjusted EBITDA Operating Profit Sales declined due to continued weak consumer demand for towing accessories - Outperformed the market - estimate end market demand down approx. 15% to 20% Adjusted EBITDA and operating profit declined as a result of lower sales volumes Aggressively manage costs and working capital Increase market share in the United States and Canada Pursue new market opportunities in select international markets

 


GRAPHIC

13 Financial Highlights & Outlook

 


GRAPHIC

14 Statement of Operations ($ in thousands) 2008 2007 2008 2007 Net sales 297,080 $ 287,670 $ 576,640 $ 572,110 $ Cost of sales. (218,330) (208,020) (424,550) (414,460) Gross profit 78,750 79,650 152,090 157,650 Selling, general and administrative expenses (48,790) (45,320) (93,910) (90,860) Advisory services agreement termination fee - (10,000) - (10,000) Costs for early termination of operating leases - (4,230) - (4,230) Loss on dispositions of property and equipment (110) 280 (220) 110 Operating profit 29,850 20,380 57,960 52,670 Other expense, net: Interest expense (13,880) (18,340) (28,590) (37,200) Debt extinguishment costs - (7,440) - (7,440) Other, net (1,340) (1,060) (2,530) (2,220) Other expense, net (15,220) (26,840) (31,120) (46,860) Income (loss) from continuing operations before income tax (expense) benefit 14,630 (6,460) 26,840 5,810 Income tax (expense) benefit (5,250) 2,400 (9,670) (2,120) Income (loss) from continuing operations 9,380 $ (4,060) $ 17,170 $ 3,690 $ Income from discontinued operations, net of income taxes 70 870 150 170 Net income (loss) 9,450 $ (3,190) $ 17,320 $ 3,860 $ Three months ended Six months ended June 30, June 30,

 


GRAPHIC

15 Statement of Operations (cont’d) 2008 2007 2008 2007 Earnings (loss) per share - basic: Continuing operations 0.28 $ (0.15) $ 0.51 $ 0.16 $ Discontinued operations, net of income taxes - 0.03 - - Net income per share 0.28 $ (0.12) $ 0.51 $ 0.16 $ Weighted average common shares - basic 33,409,500 26,223,236 33,409,500 23,506,461 Earnings (loss) per share - diluted: Continuing operations 0.28 $ (0.15) $ 0.51 $ 0.16 $ Discontinued operations, net of income taxes - 0.03 - - Net income per share 0.28 $ (0.12) $ 0.51 $ 0.16 $ Weighted average common shares - diluted 33,642,907 26,223,236 33,597,276 23,506,461 Three months ended Six months ended June 30, June 30, Note: Special Items to consider in evaluating quality of earnings include $2.3 million of restructuring charges in Q2-2008 and $14.2 million in costs and expenses related to the use of IPO proceeds in Q2-2007. Please see slides 27 and 28 for additional information regarding these Special Items.

 


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16 Balance Sheet ($ in thousands) June 30, December 31, 2008 2007 Current assets: Cash and cash equivalents 6,860 $ 4,800 $ Receivables, net 127,470 89,370 Inventories, net 186,200 190,590 Deferred income taxes 18,860 18,860 Prepaid expenses and other current assets 6,280 7,010 Assets of discontinued operations held for sale 2,760 3,330 Total current assets 348,430 313,960 Property and equipment, net 197,840 195,120 Goodwill 384,270 377,340 Other intangibles, net 209,320 214,290 Other assets 25,250 27,280 Total assets 1,165,110 $ 1,127,990 $ Current liabilities: Current maturities, long-term debt 9,900 $ 8,390 $ Accounts payable 140,440 121,860 Accrued liabilities 63,950 71,830 Liabilities of discontinued operations 1,170 1,450 Total current liabilities 215,460 203,530 Long-term debt 606,500 607,600 Deferred income taxes 73,950 73,280 Other long-term liabilities 35,630 35,090 Total liabilities 931,540 919,500 Preferred stock $0.01 par: Authorized 100,000,000 shares; Issued and outstanding: None. - - Common stock, $0.01 par: Authorized 400,000,000 shares; Issued and outstanding: 33,409,500 shares at June 30, 2008 and December 31, 2007, respectively 330 330 Paid-in capital 526,840 525,960 Accumulated deficit (356,650) (373,970) Accumulated other comprehensive income 63,050 56,170 Total shareholders' equity 233,570 208,490 Total liabilities and shareholders' equity. 1,165,110 $ 1,127,990 $ Assets Liabilities and Share holders' Equity

 


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17 Working Capital Management Accounts Receivable - DSO decreased 3 days vs. 6/30/07 Inventory - $7 million reduction from Q1-2008 to Q2-2008 - Impact of growth investments - Impact of Asia supply chain - Y-O-Y increase of $16 million (Approx. $9 million due to inflation) Accounts Payable - Concerted effort to manage vendor relationships and terms Renewed focus on intra-quarter management

 


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18 Capitalization As of June 30, 2008, TriMas had $6.9 million in cash and approximately $143.9 million of available liquidity under its revolving credit and receivables securitization facilities. ($ in thousands) June 30, 2008 June 30, 2007 December 31, 2007 Cash and Cash Equivalents 6,860 $ 2,720 $ 4,800 $ Senior Secured Bank Debt 279,360 285,080 279,020 9.875% Senior Sub Notes due 2012 337,040 336,890 336,970 Total Debt 616,400 $ 621,970 $ 615,990 $ Total Shareholders’ Equity 233,570 $ 360,760 $ 208,490 $ Total Capitalization. 849,970 $ 982,730 $ 824,480 $ Memo: A/R Securitization 32,980 $ 48,770 $ 41,500 $ Total Debt + A/R Securitization 649,380 $ 670,740 $ 657,490 $ Key Ratios: Bank LTM EBITDA 152,810 $ 159,290 $ 161,040 $ Interest Coverage Ratio 2.54x 2.09x 2.21x Leverage Ratio 4.25x 4.21x 4.08x Bank Covenants: Interest Coverage Ratio 1.90x 1.85x 1.90x Leverage Ratio 5.25x 5.65x 5.25x

 


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19 TriMas reaffirmed full-year 2008 earnings guidance previously provided: - Second quarter results met the Company’s expectations - Excluding Special Items(1), EPS range from continuing operations of $0.85 per share to $0.95 per share, compared to $0.79 per share in 2007 - Excluding Special Items(1), net income of $28.5 million to $31.9 million, compared to 2007 net income of $22.4 million 2008 Outlook – Full Year (1) Special Items to consider in evaluating quality of earnings include $2.3 million of restructuring charges in Q2-2008 and $14.2 million in costs and expenses related to the use of IPO proceeds in Q2-2007. Please see slides 27 and 28 for additional information regarding these Special Items.

 


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20 Current Opportunities and Risks Volume (growth and market) - Energy Products - Packaging Systems (specialty dispensing products) Price - Industrial Specialties - Packaging Systems Cost reduction - RV & Trailer and Recreational Accessories - Industrial Specialties - Packaging - Corporate Office Volume challenges - RV & Trailer Products and Recreational Accessories - Packaging Systems (laminate and insulation products) Price realization Europe Opportunities Risks

 


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21 2008 Priorities Deploy capital prudently Manage balance sheet Offset cost inflation Redeploy low-value, transactional costs to fund product and market initiatives

 


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Questions and Answers

 


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Appendix

 


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24 Second Quarter 2008 Results 2008 2007 Change 2008 2007 Change Net Sales Packaging Systems 57,410 $ 56,700 $ 1.3% 111,980 $ 110,450 $ 1.4% Energy Products 53,160 41,020 29.6% 101,960 82,600 23.4% Industrial Specialties 56,210 52,850 6.4% 109,680 103,440 6.0% RV & Trailer Products 49,730 53,070 -6.3% 100,400 106,480 -5.7% Recreational Accessories 80,570 84,030 -4.1% 152,620 169,140 -9.8% Net sales from continuing operations 297,080 $ 287,670 $ 3.3% 576,640 $ 572,110 $ 0.8% Operating Profit Packaging Systems 9,150 $ 10,820 $ -15.4% 18,030 $ 19,820 $ -9.0% Energy Products 8,590 5,660 51.8% 16,500 12,070 36.7% Industrial Specialties 11,480 11,220 2.3% 22,640 22,440 0.9% RV & Trailer Products 2,060 6,010 -65.7% 4,810 12,470 -61.4% Recreational Accessories 6,490 7,360 -11.8% 9,120 12,500 -27.0% Corporate expenses and management fees (7,920) (20,690) -61.7% (13,140) (26,630) -50.7% Operating profit from continuing operations 29,850 $ 20,380 $ 46.5% 57,960 $ 52,670 $ 10.0% % Margin 10.0% 7.1% 40.8% 10.1% 9.2% 9.8% Adjusted EBITDA(1) Packaging Systems 12,780 $ 14,100 $ -9.4% 25,670 $ 26,390 $ -2.7% Energy Products 9,190 6,260 46.8% 17,820 13,360 33.4% Industrial Specialties 12,960 12,350 4.9% 25,600 24,500 4.5% RV & Trailer Products 3,940 7,840 -49.7% 8,470 16,360 -48.2% Recreational Accessories 8,860 9,680 -8.5% 13,910 17,420 -20.1% Segment Adjusted EBITDA 47,730 50,230 -5.0% 91,470 98,030 -6.7% % Margin 16.1% 17.5% -8.0% 15.9% 17.1% -7.0% Corporate expenses, management fees and other (8,320) (21,350) -61.0% (14,440) (28,230) -48.8% Adjusted EBITDA (1) from continuing operations 39,410 $ 28,880 $ 36.5% 77,030 $ 69,800 $ 10.4% % Margin 13.3% 10.0% 33.0% 13.4% 12.2% 9.8% Three months ended June 30, Six months ended June 30, ($ in thousands) (1) The Company defines Adjusted EBITDA as net income (loss) before cumulative effect of accounting change, interest, taxes, depreciation, amortization, non-cash asset and goodwill impairment writeoffs, and non-cash losses on sale-leaseback of property and equipment. Lease expense and non-recurring charges are included in Adjusted EBITDA and include both cash and non-cash charges related to restructuring and integration expenses. In evaluating our business, management considers and uses Adjusted EBITDA as a key indicator of financial operating performance and as a measure of cash generating capability. Management believes this measure is useful as an analytical indicator of leverage capacity and debt servicing ability, and uses it to measure financial performance as well as for planning purposes. However, Adjusted EBITDA should not be considered as an alternative to net income, cash flow from operating activities or any other measures calculated in accordance with U.S. GAAP, or as an indicator of operating performance. The definition of Adjusted EBITDA used here may differ from that used by other companies.

 


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25 Statement of Cash Flows ($ in thousands) Six months ended Three months ended June 30, June 30 , 2008 2007 2008 2007 Net income 17,320 $ 3,860 $ 9,450 $ (3,190) $ Adjustment s to reconcile net income to net cash provided by operating activities, net of acquisition impact: Loss on dispositions of property and equipment 90 70 (20) (310) Depreciation 13,900 11,660 7,050 5,730 Amortization of intangible assets 7,800 7,800 3,900 3,890 Amortization of debt issue costs 1,220 3,970 620 3,240 Deferred income taxes - 770 - 110 Non-cash compensation expense 880 120 590 50 Net proceeds from (reductions in) sale of receivables and receivables securitization (3,630) 33,330 (22,460) 4,580 Increase in receivables (33,290) (48,230) 1,630 3,700 (Increase) decrease in inventories 4,950 (7,850) 6,740 (2,150) Decrease in prepaid expenses and other assets 1,910 2,630 240 720 Increase in accounts payable and accrued liabilities 10,090 16,500 3,690 (19,410) Other, net 2,020 1,310 2,140 2,040 Net cash provided by operating activities, net of acquisition impact 23,260 25,940 13,570 (1,000) Cash Flows from Investing Activities: Capital expenditures (13,530) (14,860) (7,340) (8,280) Acquisition of leased assets - (29,960) - (17,060) Acquisition of businesses, net of cash acquired (6,190) - (3,790) - Net proceeds from disposition of businesses and other asset s 340 5,850 340 1,850 Net cash used for investing activities (19,380) (38,970) (10,790) (23,490) Cash Flows from Financing Activities: Proceeds from sale of common stock in connect ion with the Company’s initial public offering, net of issuance costs - 126,460 - 126,460 Repayment s of borrowings on senior credit facilities (2,930) (1,730) (850) (870) Proceeds from borrowings on term loan facilities 490 - 490 - Proceeds from borrowings on revolving credit facilities 269,200 248,370 112,620 104,220 Repayment s of borrowings on revolving credit facilities (268,580) (260,950) (113,690) (106,500) Retirement of senior subordinated notes - (100,000) - (100,000) Net cash (used for) provided by financing activities (1,820) 12,150 (1,430) 23,310 Cash and Cash Equivalents: Increase (decrease) f or the period 2,060 (880) 1,350 (1,180) At beginning of period 4,800 3,600 5,510 3,900 At end of period 6,860 $ 2,720 $ 6,860 $ 2,720 $ Supplemental disclosure of cash flow information: Cash paid for interest 27,100 $ 34,510 $ 21,170 $ 27,880 $ Cash paid for taxes 5,330 $ 5,010 $ 2,940 $ 2,750 $ 

 


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26 Reconciliation of Non-GAAP Measure Adjusted EBITDA ($ in thousands) (1) The Company defines Adjusted EBITDA as net income (loss) before cumulative effect of accounting change, interest, taxes, depreciation, amortization, non-cash asset and goodwill impairment write-offs, and non-cash losses on sale-leaseback of property and equipment. Lease expense and non-recurring charges are included in Adjusted EBITDA and include both cash and non-cash charges related to restructuring and integration expenses. In evaluating our business, management considers and uses Adjusted EBITDA as a key indicator of financial operating performance and as a measure of cash generating capability. Management believes this measure is useful as an analytical indicator of lever age capacity and debt servicing ability, and uses it to measure financial performance as well as for planning purposes. However, Adjusted EBITDA should not be considered as an alternative to net income, cash flow from operating activities or any other measures calculated in accordance with U.S. GAAP, or as an indicator of operating performance. The definition of Adjusted EBITDA used her e may differ from that used by other companies. 2008 2007 2008 2007 Net income (loss) 9,450 $ (3,190) $ 17,320 $ 3,860 $ Income tax expense (benefit) 5,270 (1,870) 9,750 3,110 Interest expense 13,930 18,340 28,690 37,200 Debt extinguishment costs - 7,440 - 7,440 Depreciation and amortization 10,950 9,620 21,700 19,460 Adjusted EBITDA (1) 39,600 30,340 77,460 71,070 Adjusted EBITDA (1), discontinued operations 190 1,460 430 1,270 Adjusted EBITDA (1), continuing operations 39,410 $ 28,880 $ 77,030 $ 69,800 $ Three Months Ended June 30, Six Months Ended June 30,

 


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27 Additional Information Regarding Special Items Impacting Reported GAAP Financial Measures Three months ended Six months ended June 30, June 30, (dollars in thousands) 2008 2007 2008 2007 Operating profit from continuing operations, as reported 29,850 $ 20,380 $ 57,960 $ 52,670 $ Special Items to consider in evaluating quality of earnings: Advisory services agreement termination fee - $ (10,000) $ - $ (10,000) $ Costs for early termination of operating leases - (4,230) - (4,230) Restructuring activities (2,260) - (2,260) - Total Special Items (2,260) $ (14,230) $ (2,260) $ (14,230) $ Three months ended Six months ended June 30, June 30, (dollars in thousands) 2008 2007 2008 2007 Adjusted EBITDA from continuing operations, as reported 39,410 $ 28,880 $ 77,030 $ 69,800 $ Special Items to consider in evaluating quality of earnings: Advisory services agreement termination fee - $ (10,000) $ - $ (10,000) $ Costs for early termination of operating leases - (4,230) - (4,230) Restructuring activities (2,260) - (2,260) - Total Special Items (2,260) $ (14,230) $ (2,260) $ (14,230) $ 

 


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28 Additional Information Regarding Special Items Impacting Reported GAAP Financial Measures Three months ended Three months ended June 30, 2008 June 30, 2007 (dollars in thousands, except per share amounts) Income (Loss) EPS Income (Loss) EPS Income (Loss) and Diluted EPS from continuing operations, as reported 9,380 $ 0.28 $ (4,060) $ (0.15) $ After-tax impact of Special Items to consider in evaluating quality of income (loss) and diluted EPS from continuing operations: Advisory services agreement termination fee - $ - $ (6,300) $ (0.24) $ Costs for early termination of operating leases - - (2,660) (0.10) Debt extinguishment costs - - (4,690) (0.18) Restructuring activities (1,440) (0.04) - - Total Special Items (1,440) $ (0.04) $ (13,650) $ (0.52) $ Weighted-average diluted shares outstanding at June 30, 2008 and 2007 33,642,907 26,223,236 Six months ended Six months ended June 30, 2008 June 30, 2007 (dollars in thousands, except per share amounts) Income EPS Income EPS Income and Diluted EPS from continuing operations, as reported. 17,170 $ 0.51 $ 3,690 $ 0.16 $ After-tax impact of Special Items to consider in evaluating quality of income and diluted EPS from continuing operations: Advisory services agreement termination fee - $ - $ (6,300) $ (0.27) $ Costs for early termination of operating leases - - (2,660) (0.11) Debt extinguishment costs. - - (4,690) (0.20) Restructuring activities (1,440) (0.04) - - Total Special Items (1,440) $ (0.04) $ (13,650) $ (0.58) $ Weighted-average diluted shares outstanding at June 30, 2008 and 2007 33,597,276 23,506,461

 


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29 (Unaudited - $ in thousands) LTM EBITDA as Defined in Credit Agreement Reported net loss for the twelve months ended June 30, 2008 (144,970) $ Interest expense, net (as defined) 59,800 Income tax expense (benefit) (3,810) Depreciation and amortization 43,590 Extraordinary non-cash charges 178,450 Interest equivalent costs 3,650 Non-cash expenses related to equity grants 1,330 Other non-cash expenses or losses. 5,540 Non-recurring expenses or costs for cost savings projects 8,450 Permitted dispositions 680 Permitted acquisitions 100 Bank EBITDA - LTM Ended June 30, 2008 (1) 152,810 $ (1) As defined in the Amended and Restated Credit Agreement dated August 2, 2006.