| UNITED STATES | ||||||||
| SECURITIES AND EXCHANGE COMMISSION | ||||||||
| 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 28, 2022
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction | (Commission | (IRS Employer | ||||||||||||
| of incorporation) | File Number) | Identification No.) | ||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||||||||
Registrant’s telephone number, including area code (248 ) 631-5450
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):
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol(s) | Name of exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
| Emerging growth company | ||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
TriMas Corporation (the “Company”) issued a press release on July 28, 2022, reporting its financial results for the second quarter ending June 30, 2022. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The press release is also available on the Corporation's website at www.trimascorp.com.
The information presented in Exhibit 99.1 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 Company under the Securities Act of 1933 (the "Securities Act") or the Exchange Act.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. The following exhibits are furnished herewith:
| Exhibit No. | Description | |||||||||||||
| 99.1 | ||||||||||||||
| 104 | Cover Page Interactive File (embedded within the Inline XBRL document). | |||||||||||||
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 28, 2022 | By: | /s/ Paul A. Swart | |||||||||||||||||
| Name: | Paul A. Swart | |||||||||||||||||||
| Title: | Vice President Business Planning, Controller and Chief Accounting Officer | |||||||||||||||||||
TRIMAS REPORTS SECOND QUARTER 2022 RESULTS
Company Reaffirms Full Year 2022 Outlook
BLOOMFIELD HILLS, Michigan, July 28, 2022 - TriMas (NASDAQ: TRS) today announced financial results for the second quarter ended June 30, 2022.
TriMas Highlights
•Increased second quarter 2022 net sales by 8.5%, led by sales growth in TriMas' Specialty Products group of 20.5%
•Increased second quarter 2022 operating profit by 16.8% to $29.9 million and adjusted operating profit(1) by 7.2% to $32.1 million
•Reported second quarter diluted EPS of $0.47 and an adjusted diluted EPS(2) of $0.60
•Repurchased 927,987 shares of outstanding common stock, reducing net shares outstanding by approximately 1.8% during the first half of 2022
•Reaffirmed full year 2022 sales, adjusted diluted EPS(2) and Free Cash Flow(3) outlook
Second Quarter 2022
TriMas reported second quarter 2022 net sales of $237.7 million, an increase of 8.5% compared to $219.0 million in second quarter 2021, primarily as a result of increased demand in TriMas' Specialty Products group and acquisition-related sales, partially offset by the impact of unfavorable currency exchange. The Company reported operating profit of $29.9 million in second quarter 2022, an increase of 16.8% compared to $25.6 million in second quarter 2021. Adjusting for Special Items(1) primarily related to realignment and acquisition-related diligence and transaction costs, second quarter 2022 adjusted operating profit was $32.1 million, an increase of 7.2% compared to $30.0 million in the prior year period, as the earnings on incremental sales more than offset the less favorable product sales mix, continuing inflationary pressure on input costs, including energy, freight and certain commodity costs, production inefficiencies from prolonged pandemic-related labor challenges and supply chain constraints.
The Company reported second quarter 2022 net income of $19.9 million, or $0.47 per diluted share, compared to $11.8 million, or $0.27 per diluted share, in second quarter 2021. Adjusting for Special Items(1), second quarter 2022 adjusted net income(2) was $21.8 million, a decrease compared to $22.7 million in second quarter 2021, as while the Company generated higher year-over-year adjusted operating profit, the tax rate in second quarter 2021 was lower due to tax planning initiatives. As a result, second quarter 2022 adjusted diluted earnings per share(2) was $0.60, as compared to $0.62 in the prior year period.
"During the second quarter, our team delivered sales growth of 8.5% and adjusted diluted EPS(2) of $0.60, in line with our expectations," said Thomas Amato, TriMas President and Chief Executive Officer. "Like many companies, TriMas was not immune to the impacts of production labor availability, supply challenges and inflationary effects, as well as an extremely dynamic demand environment. We continue to leverage the TriMas Business Model, remaining flexible and adjusting our capacity in our operations when demand for various product lines differs from our planning models.
"In addition, our operational and treasury actions have enabled TriMas to navigate well through this unprecedented market period, while continuing to gain traction against our long-range objectives. We continue to deploy capital in a balanced manner, as we invest in organic growth initiatives, pursue strategic bolt-on acquisitions and return capital to shareholders through share repurchases and dividends. We remain confident that TriMas’ diversified end market model, strong balance sheet and multiple levers for growth will provide long-term benefits to our shareholders," Amato concluded.
Financial Position
During second quarter 2022, the Company repurchased 645,984 shares of its outstanding common stock for $18.8 million, bringing the Company's total share repurchases for the first half of 2022 to 927,987 shares, or a net reduction of approximately 1.8% of outstanding shares. As of June 30, 2022, $114.7 million remained available under the Company's repurchase authorization. During second quarter 2022, TriMas also paid a quarterly cash dividend of $0.04 per share of TriMas Corporation stock on May 12, 2022.
1
TriMas ended second quarter 2022 with $348.1 million of unrestricted cash and aggregate availability under its revolving credit facility, $49.1 million of unrestricted cash on hand and a leverage ratio of 2.0x as defined in the Company's credit agreement. TriMas reported total debt of $394.3 million and Net Debt(4) of $345.2 million as of June 30, 2022.
The Company reported net cash provided by operating activities of $22.0 million for second quarter 2022, compared to $26.9 million in second quarter 2021. As a result, the Company reported Free Cash Flow(3) of $15.5 million for second quarter 2022 compared to $20.6 million in second quarter 2021, primarily due to proactive procurement actions. The Company continues to target 2022 Free Cash Flow(3) to be greater than 100% of net income. Please see Appendix I for further details.
Second Quarter Segment Results
TriMas' Packaging segment represents approximately 61% of TriMas June 30, 2022 LTM sales. Net sales for the second quarter increased 6.2%, including 3.4% of unfavorable currency exchange pressure, compared to the year ago period, as sales from our recent acquisitions and higher demand for closure products were partially offset by lower sales of dispenser-related product lines. During second quarter 2021, dispenser-related product line sales in beauty and personal care end markets benefited from strong customer demand believed to be related to the pandemic. Second quarter operating profit was relatively flat, while the related margin percentage decreased, as the impact of increased sales was moderated by higher energy costs, primarily in Europe, and other inflationary input costs.
TriMas' Aerospace segment represents approximately 21% of TriMas June 30, 2022 LTM sales. Net sales for the second quarter increased 6.4% compared to the year ago period, as the impact of increased aerospace production demand and acquisition-related sales more than offset the expected decline in special stocking orders, which were predominantly fulfilled in 2021. Second quarter operating profit and the related margin increased, as the fixed cost leverage on higher sales levels more than offset the impact of the 2021 high margin special stocking sales.
TriMas' Specialty Products segment represents approximately 18% of TriMas June 30, 2022 LTM sales. Second quarter net sales increased 20.5% compared to the year ago period, primarily due to higher demand for steel cylinders used in construction and HVAC applications, as well as increased sales of engines, compressors and replacement parts for stationary power generation units and applications for natural gas and crude oil extraction related to the higher oil-field activity in North America. Second quarter operating profit increased, while the related margin percentage decreased, as earnings generated on higher sales were partially offset by an increase in material costs.
Outlook
The Company reaffirms its full year 2022 outlook originally provided on March 1, 2022. The Company expects to generate full year 2022 adjusted diluted earnings per share(2) in the range of $2.25 to $2.35, based on consolidated sales growth of 8% to 11% compared to 2021. In addition, the Company is targeting 2022 Free Cash Flow(3) to be greater than 100% of net income.
The above outlook includes the impact of all announced acquisitions, but excludes any additional future direct or indirect impacts that may result from additional supply or labor disruptions related to the COVID pandemic or other factors, and the geopolitical risks related to the ongoing conflict in Eastern Europe. All of the above amounts considered as 2022 guidance are after adjusting for any current or future amounts that may be considered Special Items, and in the case of adjusted diluted earnings per share, acquisition-related intangible asset amortization expense for deals that have not yet been consummated. The inability to predict the amount and timing of the impacts of these Special Items makes a detailed reconciliation of these forward-looking non-GAAP financial measures impracticable.(1)
Conference Call Information
TriMas will host its second quarter 2022 earnings conference call today, Thursday, July 28, 2022, at 10 a.m. ET. The call-in number is (888) 220-8451. Participants should request to be connected to the TriMas second quarter 2022 earnings conference call (Confirmation Code 7250176). The conference call will also be simultaneously webcast via TriMas' website at www.trimascorp.com, under the "Investors" section, with an accompanying slide presentation. A replay of the conference call will be available on the TriMas website or by dialing (888) 203-1112 (Replay Passcode 7250176) beginning July 28, 2022, at 3 p.m. ET through August 4, 2022, at 3 p.m. ET.
2
Notice Regarding Forward-Looking Statements
Any "forward-looking" statements, within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, contained herein, including those relating to TriMas’ business, financial condition or future results, involve risks and uncertainties with respect to, including, but not limited to: the severity and duration of the ongoing coronavirus (“COVID-19”) pandemic on our operations, customers and suppliers, as well as related actions taken by governmental authorities and other third parties in response, each of which is uncertain, rapidly changing and difficult to predict; general economic and currency conditions; inflationary pressures on our supply chain, including raw material and energy costs, and customers; interest rate volatility; risks and uncertainties associated with intangible assets, including goodwill or other intangible asset impairment charges; competitive factors; future trends; our ability to realize our business strategies; our ability to identify attractive acquisition candidates, successfully integrate acquired operations or realize the intended benefits of such acquisitions; information technology and other cyber-related risks; the performance of our subcontractors and suppliers; supply constraints, including the availability and cost of raw materials; market demand; intellectual property factors; litigation; government and regulatory actions, including, without limitation, climate change legislation and other environmental regulations, as well as the impact of tariffs, quotas and surcharges; our leverage; liabilities imposed by our debt instruments; labor disputes and shortages; changes to fiscal and tax policies; contingent liabilities relating to acquisition activities; the disruption of operations from catastrophic or extraordinary events, including natural disasters and public health crises; the amount and timing of future dividends and/or share repurchases, which remain subject to Board approval and depend on market and other conditions; our future prospects; and other risks that are detailed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021. The risks described are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deemed to be immaterial also may materially adversely affect our business, financial position and results of operations or cash flows. These risks and uncertainties may cause actual results to differ materially from those indicated by the forward-looking statements. All forward-looking statements made herein are based on information currently available, and the Company assumes no obligation to update any forward-looking statements, except as required by law.
Non-GAAP Financial Measures
In this release, certain non-GAAP financial measures are used. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measure may be found in Appendix I at the end of this release. Management believes that presenting these non-GAAP financial measures provides useful information to investors by helping them identify underlying trends in the Company’s businesses and facilitating comparisons of performance with prior and future periods and to the Company’s peers. These non-GAAP financial measures should be considered in addition to, and not as a replacement for or superior to, the comparable GAAP measure, and may not be comparable to similarly titled measures reported by other companies.
Reconciliations of forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measures are provided only for the expected impact of amortization of acquisition-related intangible assets for completed acquisitions, as the Company is unable to provide estimates of future Special Items(1) or amortization from future acquisitions without unreasonable effort, due to the uncertainty and inherent difficulty of predicting the occurrence and the financial impact of such items impacting comparability and the periods in which such items may be recognized. For the same reasons, the Company is unable to address the probable significance of the unavailable information, which could be material to future results.
Additional information is available at www.trimascorp.com under the “Investors” section.
(1) Appendix I details certain costs, expenses and other amounts or charges, collectively described as "Special Items," that are included in the determination of net income, earnings per share and/or cash flows from operating activities under GAAP, but that management believes should be separately considered when evaluating the quality of the Company’s core operating results, given they may not reflect the ongoing activities of the business.
(2) The Company defines adjusted diluted earnings per share as net income (per GAAP), plus or minus the after-tax impact of Special Items(2), plus the after-tax impact of non-cash acquisition-related intangible asset amortization expense. While the acquisition-related intangible assets aid in the Company’s revenue generation, the Company adjusts for the non-cash amortization expense because the Company believes it (i) enhances management’s and investors’ ability to analyze underlying business performance, (ii) facilitates comparisons of financial results over multiple periods, and (iii) provides more relevant comparisons of financial results with the results of other companies as the amortization expense associated with these assets may fluctuate significantly from period to period based on the timing, size, nature, and number of acquisitions.
3
(3) The Company defines Free Cash Flow as Net Cash Provided by/Used for Operating Activities, excluding the cash impact of Special Items, less Capital Expenditures. Please see Appendix I for additional details.
(4) The Company defines Net Debt as Total Debt less Cash and Cash Equivalents. Please see Appendix I for additional details.
About TriMas
TriMas manufactures a diverse set of products primarily for the consumer products, aerospace and industrial markets through its TriMas Packaging, TriMas Aerospace and Specialty Products groups. Our approximately 3,500 dedicated employees in 13 countries provide customers with a wide range of innovative and quality product solutions through our market-leading businesses. Our TriMas family of businesses has strong brand names in the markets served, and operates under a common set of values and strategic priorities under the TriMas Business Model. TriMas is publicly traded on the NASDAQ under the ticker symbol “TRS,” and is headquartered in Bloomfield Hills, Michigan. For more information, please visit www.trimascorp.com.
Contact
Sherry Lauderback
VP, Investor Relations & Communications
(248) 631-5506
sherrylauderback@trimascorp.com
4
TriMas Corporation
Condensed Consolidated Balance Sheet
(Dollars in thousands)
| June 30, 2022 | December 31, 2021 | |||||||||||||
| Assets | (unaudited) | |||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | 49,090 | $ | 140,740 | ||||||||||
| Receivables, net | 155,140 | 125,630 | ||||||||||||
| Inventories | 164,040 | 152,450 | ||||||||||||
| Prepaid expenses and other current assets | 17,000 | 12,950 | ||||||||||||
| Total current assets | 385,270 | 431,770 | ||||||||||||
| Property and equipment, net | 275,670 | 265,630 | ||||||||||||
| Operating lease right-of-use assets | 50,500 | 50,650 | ||||||||||||
| Goodwill | 339,210 | 315,490 | ||||||||||||
| Other intangibles, net | 197,100 | 196,730 | ||||||||||||
| Deferred income taxes | 8,990 | 9,740 | ||||||||||||
| Other assets | 46,020 | 33,630 | ||||||||||||
| Total assets | $ | 1,302,760 | $ | 1,303,640 | ||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Accounts payable | $ | 96,870 | $ | 87,800 | ||||||||||
| Accrued liabilities | 50,490 | 58,980 | ||||||||||||
| Operating lease liabilities, current portion | 8,230 | 8,120 | ||||||||||||
| Total current liabilities | 155,590 | 154,900 | ||||||||||||
| Long-term debt, net | 394,270 | 393,820 | ||||||||||||
| Operating lease liabilities | 44,110 | 43,780 | ||||||||||||
| Deferred income taxes | 25,750 | 21,260 | ||||||||||||
| Other long-term liabilities | 52,260 | 59,030 | ||||||||||||
| Total liabilities | 671,980 | 672,790 | ||||||||||||
| Total shareholders' equity | 630,780 | 630,850 | ||||||||||||
| Total liabilities and shareholders' equity | $ | 1,302,760 | $ | 1,303,640 | ||||||||||
5
TriMas Corporation
Consolidated Statement of Income
(Unaudited - dollars in thousands, except per share amounts)
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
| Net sales | $ | 237,680 | $ | 218,990 | $ | 461,990 | $ | 425,720 | ||||||||||||||||||
| Cost of sales | (177,000) | (160,960) | (347,600) | (316,360) | ||||||||||||||||||||||
| Gross profit | 60,680 | 58,030 | 114,390 | 109,360 | ||||||||||||||||||||||
| Selling, general and administrative expenses | (30,810) | (32,460) | (62,590) | (62,680) | ||||||||||||||||||||||
| Operating profit | 29,870 | 25,570 | 51,800 | 46,680 | ||||||||||||||||||||||
| Other expense, net: | ||||||||||||||||||||||||||
| Interest expense | (3,500) | (4,120) | (6,910) | (7,670) | ||||||||||||||||||||||
| Debt financing and related expenses | — | (10,320) | — | (10,520) | ||||||||||||||||||||||
| Other income (expense), net | 270 | 670 | (10) | (260) | ||||||||||||||||||||||
| Other expense, net | (3,230) | (13,770) | (6,920) | (18,450) | ||||||||||||||||||||||
| Income before income tax expense | 26,640 | 11,800 | 44,880 | 28,230 | ||||||||||||||||||||||
| Income tax benefit (expense) | (6,780) | 40 | (10,850) | (3,330) | ||||||||||||||||||||||
| Net income | $ | 19,860 | $ | 11,840 | $ | 34,030 | $ | 24,900 | ||||||||||||||||||
| Basic earnings per share: | ||||||||||||||||||||||||||
| Net income per share | $ | 0.47 | $ | 0.27 | $ | 0.80 | $ | 0.58 | ||||||||||||||||||
| Weighted average common shares—basic | 42,297,525 | 43,110,191 | 42,548,366 | 43,147,599 | ||||||||||||||||||||||
| Diluted earnings per share: | ||||||||||||||||||||||||||
| Net income per share | $ | 0.47 | $ | 0.27 | $ | 0.80 | $ | 0.57 | ||||||||||||||||||
| Weighted average common shares—diluted | 42,481,199 | 43,308,356 | 42,795,446 | 43,471,616 | ||||||||||||||||||||||
6
TriMas Corporation
Consolidated Statement of Cash Flow
(Unaudited - dollars in thousands)
| Six months ended June 30, | ||||||||||||||
| 2022 | 2021 | |||||||||||||
| Cash Flows from Operating Activities: | ||||||||||||||
| Net income | $ | 34,030 | $ | 24,900 | ||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities, net of acquisition impact: | ||||||||||||||
| Loss on dispositions of assets | 210 | 130 | ||||||||||||
| Depreciation | 17,150 | 15,830 | ||||||||||||
| Amortization of intangible assets | 10,040 | 10,780 | ||||||||||||
| Amortization of debt issue costs | 450 | 520 | ||||||||||||
| Deferred income taxes | 3,320 | 1,790 | ||||||||||||
| Non-cash compensation expense | 5,300 | 5,660 | ||||||||||||
| Debt financing and related expenses | — | 10,520 | ||||||||||||
| Increase in receivables | (29,430) | (22,600) | ||||||||||||
| Increase in inventories | (7,940) | (900) | ||||||||||||
| Decrease (increase) in prepaid expenses and other assets | 790 | (7,430) | ||||||||||||
| Increase (decrease) in accounts payable and accrued liabilities | (8,870) | 1,350 | ||||||||||||
| Other operating activities | 2,640 | 2,120 | ||||||||||||
| Net cash provided by operating activities, net of acquisition impact | 27,690 | 42,670 | ||||||||||||
| Cash Flows from Investing Activities: | ||||||||||||||
| Capital expenditures | (21,720) | (18,330) | ||||||||||||
| Acquisition of businesses, net of cash acquired | (64,100) | — | ||||||||||||
| Net proceeds from disposition of property and equipment | 110 | 140 | ||||||||||||
| Net cash used for investing activities | (85,710) | (18,190) | ||||||||||||
| Cash Flows from Financing Activities: | ||||||||||||||
| Retirement of senior notes | — | (300,000) | ||||||||||||
| Proceeds from issuance of senior notes | — | 400,000 | ||||||||||||
| Proceeds from borrowings on revolving credit facilities | 12,000 | — | ||||||||||||
| Repayments of borrowings on revolving credit facilities | (12,000) | (48,620) | ||||||||||||
| Debt financing fees and senior notes redemption premium | — | (13,570) | ||||||||||||
| Payments to purchase common stock | (27,890) | (14,210) | ||||||||||||
| Shares surrendered upon exercise and vesting of equity awards to cover taxes | (2,280) | (4,620) | ||||||||||||
| Dividends paid | (3,460) | — | ||||||||||||
| Net cash provided by (used for) financing activities | (33,630) | 18,980 | ||||||||||||
| Cash and Cash Equivalents: | ||||||||||||||
| Increase (decrease) for the period | (91,650) | 43,460 | ||||||||||||
| At beginning of period | 140,740 | 73,950 | ||||||||||||
| At end of period | $ | 49,090 | $ | 117,410 | ||||||||||
| Supplemental disclosure of cash flow information: | ||||||||||||||
| Cash paid for interest | $ | 6,330 | $ | 6,170 | ||||||||||
| Cash paid for taxes | $ | 1,120 | $ | 4,420 | ||||||||||
7
Appendix I
TriMas Corporation
Additional Information Regarding Special Items Impacting
Reported GAAP Financial Measures
(Unaudited - dollars in thousands)
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
| Packaging | ||||||||||||||||||||||||||
| Net sales | $ | 148,350 | $ | 139,630 | $ | 286,840 | $ | 271,720 | ||||||||||||||||||
| Operating profit | $ | 27,800 | $ | 27,850 | $ | 49,130 | $ | 49,150 | ||||||||||||||||||
| Special Items to consider in evaluating operating profit: | ||||||||||||||||||||||||||
| Purchase accounting costs | 280 | — | 760 | 830 | ||||||||||||||||||||||
| Business restructuring and severance costs | 1,150 | 390 | 3,120 | 1,900 | ||||||||||||||||||||||
| Adjusted operating profit | $ | 29,230 | $ | 28,240 | $ | 53,010 | $ | 51,880 | ||||||||||||||||||
| Aerospace | ||||||||||||||||||||||||||
| Net sales | $ | 47,390 | $ | 44,560 | $ | 91,910 | $ | 89,170 | ||||||||||||||||||
| Operating profit | $ | 2,750 | $ | 2,120 | $ | 4,590 | $ | 6,620 | ||||||||||||||||||
| Special Items to consider in evaluating operating profit: | ||||||||||||||||||||||||||
| Purchase accounting costs | 160 | — | 400 | — | ||||||||||||||||||||||
| Business restructuring and severance costs | 360 | 620 | 690 | 1,070 | ||||||||||||||||||||||
| Adjusted operating profit | $ | 3,270 | $ | 2,740 | $ | 5,680 | $ | 7,690 | ||||||||||||||||||
| Specialty Products | ||||||||||||||||||||||||||
| Net sales | $ | 41,940 | $ | 34,800 | $ | 83,240 | $ | 64,830 | ||||||||||||||||||
| Operating profit | $ | 6,770 | $ | 6,010 | $ | 14,010 | $ | 10,530 | ||||||||||||||||||
| Corporate Expenses | ||||||||||||||||||||||||||
| Operating loss | $ | (7,450) | $ | (10,410) | $ | (15,930) | $ | (19,620) | ||||||||||||||||||
| Special Items to consider in evaluating operating loss: | ||||||||||||||||||||||||||
| M&A diligence and transaction costs | 240 | 170 | 1,150 | 660 | ||||||||||||||||||||||
| Business restructuring and severance costs | 80 | 3,230 | 450 | 5,480 | ||||||||||||||||||||||
| Adjusted operating loss | $ | (7,130) | $ | (7,010) | $ | (14,330) | $ | (13,480) | ||||||||||||||||||
| Total Company | ||||||||||||||||||||||||||
| Net sales | $ | 237,680 | $ | 218,990 | $ | 461,990 | $ | 425,720 | ||||||||||||||||||
| Operating profit | $ | 29,870 | $ | 25,570 | $ | 51,800 | $ | 46,680 | ||||||||||||||||||
| Total Special Items to consider in evaluating operating profit | 2,270 | 4,410 | 6,570 | 9,940 | ||||||||||||||||||||||
| Adjusted operating profit | $ | 32,140 | $ | 29,980 | $ | 58,370 | $ | 56,620 | ||||||||||||||||||
8
Appendix I
TriMas Corporation
Additional Information Regarding Special Items Impacting
Reported GAAP Financial Measures
(Unaudited - dollars in thousands, except per share amounts)
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
| Net income, as reported | $ | 19,860 | $ | 11,840 | $ | 34,030 | $ | 24,900 | ||||||||||||||||||
| Special Items to consider in evaluating quality of net income: | ||||||||||||||||||||||||||
| Business restructuring and severance costs | 1,590 | 4,850 | 4,410 | 9,060 | ||||||||||||||||||||||
| Purchase accounting costs | 440 | — | 1,160 | 830 | ||||||||||||||||||||||
| M&A diligence and transaction costs | 240 | 170 | 1,150 | 660 | ||||||||||||||||||||||
| Debt financing and related expenses | — | 10,320 | — | 10,520 | ||||||||||||||||||||||
Income tax effect of Special Items(1) | (330) | (4,520) | (1,380) | (5,910) | ||||||||||||||||||||||
| Adjusted net income | $ | 21,800 | $ | 22,660 | $ | 39,370 | $ | 40,060 | ||||||||||||||||||
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||
| 2022 | 2021 | 2022 | 2021 | |||||||||||||||||||||||
| Diluted earnings per share, as reported | $ | 0.47 | $ | 0.27 | $ | 0.80 | $ | 0.57 | ||||||||||||||||||
| Special Items to consider in evaluating quality of EPS: | ||||||||||||||||||||||||||
| Business restructuring and severance costs | 0.04 | 0.11 | 0.10 | 0.21 | ||||||||||||||||||||||
| Purchase accounting costs | 0.01 | — | 0.03 | 0.02 | ||||||||||||||||||||||
| M&A diligence and transaction costs | 0.01 | 0.01 | 0.03 | 0.02 | ||||||||||||||||||||||
| Debt financing and related expenses | — | 0.24 | — | 0.24 | ||||||||||||||||||||||
Income tax effect of Special Items(1) | (0.01) | (0.10) | (0.03) | (0.14) | ||||||||||||||||||||||
| Pre-tax amortization of acquisition-related intangible assets | 0.11 | 0.12 | 0.23 | 0.25 | ||||||||||||||||||||||
Income tax benefit on amortization of acquisition-related intangible assets(1) | (0.03) | (0.03) | (0.06) | (0.06) | ||||||||||||||||||||||
| Adjusted diluted EPS | $ | 0.60 | $ | 0.62 | $ | 1.10 | $ | 1.11 | ||||||||||||||||||
| Weighted-average shares outstanding | 42,481,199 | 43,308,356 | 42,795,446 | 43,471,616 | ||||||||||||||||||||||
(1) Income tax effect of Special Items and amortization of acquisition-related intangible assets is calculated on an item-by-item basis, utilizing the tax rate in the jurisdiction where the Special Item or amortization occurred. For the three and six month periods ended June 30, 2022 and 2021, the income tax effect of Special Items varied from the tax rate inherent in the Company's reported GAAP results, primarily as a result of certain discrete items that occurred during the period for GAAP reporting purposes.
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Appendix I
TriMas Corporation
Additional Information Regarding Special Items Impacting
Reported GAAP Financial Measures
(Unaudited - dollars in thousands)
| Three months ended June 30, | ||||||||||||||||||||||||||||||||||||||
| 2022 | 2021 | |||||||||||||||||||||||||||||||||||||
| As reported | Special Items | As adjusted | As reported | Special Items | As adjusted | |||||||||||||||||||||||||||||||||
| Net cash provided by operating activities | $ | 22,020 | $ | 3,260 | $ | 25,280 | $ | 26,930 | $ | 2,670 | $ | 29,600 | ||||||||||||||||||||||||||
| Less: Capital expenditures | (9,830) | — | (9,830) | (8,960) | — | (8,960) | ||||||||||||||||||||||||||||||||
| Free Cash Flow | 12,190 | 3,260 | 15,450 | 17,970 | 2,670 | 20,640 | ||||||||||||||||||||||||||||||||
| Net income | 19,860 | 1,940 | 21,800 | 11,840 | 10,820 | 22,660 | ||||||||||||||||||||||||||||||||
| Free Cash Flow as a percentage of net income | 61 | % | 71 | % | 152 | % | 91 | % | ||||||||||||||||||||||||||||||
| Six months ended June 30, | ||||||||||||||||||||||||||||||||||||||
| 2022 | 2021 | |||||||||||||||||||||||||||||||||||||
| As reported | Special Items | As adjusted | As reported | Special Items | As adjusted | |||||||||||||||||||||||||||||||||
| Net cash provided by operating activities | $ | 27,690 | $ | 7,570 | $ | 35,260 | $ | 42,670 | $ | 6,590 | $ | 49,260 | ||||||||||||||||||||||||||
| Less: Capital expenditures | (21,720) | — | (21,720) | (18,330) | — | (18,330) | ||||||||||||||||||||||||||||||||
| Free Cash Flow | 5,970 | 7,570 | 13,540 | 24,340 | 6,590 | 30,930 | ||||||||||||||||||||||||||||||||
| Net income | 34,030 | 5,340 | 39,370 | 24,900 | 15,160 | 40,060 | ||||||||||||||||||||||||||||||||
| Free Cash Flow as a percentage of net income | 18 | % | 34 | % | 98 | % | 77 | % | ||||||||||||||||||||||||||||||
| June 30, 2022 | December 31, 2021 | June 30, 2021 | ||||||||||||||||||
| Long-term debt, net | $ | 394,270 | $ | 393,820 | $ | 393,370 | ||||||||||||||
| Less: Cash and cash equivalents | 49,090 | 140,740 | 117,410 | |||||||||||||||||
| Net Debt | $ | 345,180 | $ | 253,080 | $ | 275,960 | ||||||||||||||
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Appendix I
TriMas Corporation
Reconciliation of GAAP to Non-GAAP Financial Measures
Forecasted Diluted Earnings Per Share Guidance
(Unaudited - dollars per share)
| Twelve months ended | ||||||||||||||
| December 31, 2022 | ||||||||||||||
| Low | High | |||||||||||||
| Diluted earnings per share (GAAP) | $ | 1.78 | $ | 1.88 | ||||||||||
Pre-tax amortization of acquisition-related intangible assets(1) | 0.46 | 0.46 | ||||||||||||
| Income tax benefit on amortization of acquisition-related intangible assets | (0.12) | (0.12) | ||||||||||||
Impact of Special Items(2) | 0.13 | 0.13 | ||||||||||||
| Adjusted diluted earnings per share | $ | 2.25 | $ | 2.35 | ||||||||||
(1) These amounts relate to acquisitions completed prior to June 30, 2022. The Company is unable to provide forward-looking estimates of future acquisitions, if any, that have not yet been consummated.
(2) The Company is unable to provide forward-looking estimates of Special Items without unreasonable effort, due to the uncertainty and inherent difficulty of predicting the occurrence and the financial impact of such items and the periods in which such items may be recognized. For the same reasons, the Company is unable to address the probable significance of the unavailable information, which could be material to future results.
11