Albany International Reports Third-Quarter 2020 Results

Nachrichtenquelle: Business Wire (engl.)
28.10.2020, 21:37  |  123   |   |   

Albany International Corp. (NYSE:AIN) today reported operating results for its third quarter of 2020, which ended September 30, 2020.

"Our top priority remains the health and safety of our employees, and I am proud of our employees' commitment to keeping one another safe and our operations performing well,” said Albany International President and Chief Executive Officer, Bill Higgins.

“We are reporting another quarter of strong financial performance despite the challenging business conditions resulting from the pandemic. Over the past nine months, we’ve adjusted our headcount, controlled costs and executed well across our organization. These actions positioned us to deliver healthy third-quarter profit margins despite the effects of the economic downturn on our top line. Additionally, late in the third quarter we successfully reopened our three LEAP production facilities.

“The Company is well positioned to pursue our strategies for long-term growth in our markets with positive free cash flow, a strong balance sheet and ample liquidity. Our Machine Clothing segment is the global market leader with an unmatched reputation for product reliability, customer service and product innovation. We expect near-term Albany Engineered Composites results will be driven by our current portfolio of defense and commercial programs. Longer-term, we expect organic growth to be driven by additional conventional composite contract wins and the use of our proprietary 3D composite technologies in a broader array of demanding aerospace applications,” concluded Higgins.

For the third quarter ended September 30, 2020:

  • Net sales were $212.0 million, down $59.1 million, or 21.8%, when compared to the prior year. Sales declined $46.6 million, or 38.9%, in the Engineered Composites segment driven by the temporary production halt on the LEAP program.
  • Gross profit of $87.3 million was 16.1% lower than the $104.1 million reported for the same period of 2019.
  • Selling, Technical, General, and Research (STG&R) expenses were $47.8 million, compared to $48.7 million in the same period of 2019. Revaluation of foreign currency balances increased STG&R by $1.3 million in 2020, compared to a decrease of $1.0 million in the same period of 2019.
  • Operating income was $38.8 million, compared to $55.7 million in the prior year, a decrease of 30.4%, as lower gross profit and higher restructuring expenses were partially offset by lower STG&R expenses.
  • The effective tax rate was 24.7% for the third quarter of each year. Income tax adjustments reduced third-quarter income tax expense by $3.0 million in 2020 and $1.5 million in 2019.
  • Net income attributable to the Company was $29.6 million ($0.92 per share), compared to $40.0 million ($1.24 per share) in Q3 2019. Adjusted earnings per share (or Adjusted EPS, a non-GAAP measure) was $0.96 per share in the third quarter of 2020, compared to $1.17 in the same period of last year.
  • Adjusted EBITDA (a non-GAAP measure) was $61.8 million, compared to $71.4 million in Q3 2019, a decrease of 13.5%.

Please see the tables below for a reconciliation of non-GAAP measures to their comparable GAAP measures.

“We were very pleased with the Company's performance this quarter. We finished the quarter with a very strong balance sheet. We expect to continue to generate strong free cash flow during the balance of the year. Exploiting the strength of our balance sheet and strong operational performance, we have extended the Company's revolving credit agreement until October 2024," said Albany International Chief Financial Officer and Treasurer, Stephen Nolan. "We are also updating our full-year guidance, reflecting the strong operational performance the Company delivered in the third quarter."

Outlook for Full-Year 2020

Albany International is updating financial guidance for the full-year 2020:

  • Total company revenue of between $870 and $890 million;
  • Effective income tax rate, including tax adjustments, of 34% to 36%;
  • Total company depreciation and amortization of between $70 and $75 million;
  • Capital expenditures in the range of $45 to $55 million;
  • GAAP earnings per share of between $2.72 and $2.82;
  • Adjusted earnings per share of between $3.35 and $3.45;
  • Total company Adjusted EBITDA of $240 to $250 million;
  • Machine Clothing revenue of $555 to $565 million;
  • Machine Clothing Adjusted EBITDA of between $200 and $210 million;
  • Albany Engineered Composites (AEC) revenue between $315 to $325 million; and
  • Albany Engineered Composites Adjusted EBITDA of $75 to $85 million.

ALBANY INTERNATIONAL CORP.

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except per share amounts)

(unaudited)

   

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

2020

 

2019

 

2020

 

2019

Net sales

$

211,999

 

 

$

271,133

 

 

$

673,753

 

 

$

796,454

 

Cost of goods sold

124,697

 

 

167,026

 

 

393,999

 

 

495,394

 

 

 

 

 

 

 

 

 

Gross profit

87,302

 

 

104,107

 

 

279,754

 

 

301,060

 

Selling, general, and administrative expenses

39,518

 

 

39,841

 

 

118,167

 

 

121,602

 

Technical and research expenses

8,301

 

 

8,832

 

 

26,304

 

 

28,323

 

Restructuring expenses, net

710

 

 

(244

)

 

4,189

 

 

1,139

 

 

 

 

 

 

 

 

 

Operating income

38,773

 

 

55,678

 

 

131,094

 

 

149,996

 

Interest expense, net

2,242

 

 

3,987

 

 

10,042

 

 

13,035

 

Other expense/(income), net

(2,745

)

 

(1,628

)

 

13,915

 

 

(1,906

)

 

 

 

 

 

 

 

 

Income before income taxes

39,276

 

 

53,319

 

 

107,137

 

 

138,867

 

Income tax expense

9,686

 

 

13,194

 

 

37,504

 

 

35,075

 

 

 

 

 

 

 

 

 

Net income

29,590

 

 

40,125

 

 

69,633

 

 

103,792

 

Net income/(loss) attributable to the noncontrolling interest

1

 

 

116

 

 

(1,419

)

 

539

 

Net income attributable to the Company

$

29,589

 

 

$

40,009

 

 

$

71,052

 

 

$

103,253

 

 

 

 

 

 

 

 

 

Earnings per share attributable to Company shareholders - Basic

$

0.92

 

 

$

1.24

 

 

$

2.20

 

 

$

3.20

 

 

 

 

 

 

 

 

 

Earnings per share attributable to Company shareholders - Diluted

$

0.91

 

 

$

1.24

 

 

$

2.20

 

 

$

3.20

 

 

 

 

 

 

 

 

 

Shares of the Company used in computing earnings per share:

 

 

 

 

 

 

 

Basic

32,337

 

 

32,306

 

 

32,326

 

 

32,293

 

 

 

 

 

 

 

 

 

Diluted

32,344

 

 

32,317

 

 

32,333

 

 

32,305

 

 

 

 

 

 

 

 

 

Dividends declared per share, Class A and Class B

$

0.19

 

 

$

0.18

 

 

$

0.57

 

 

$

0.54

 

ALBANY INTERNATIONAL CORP.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

(unaudited)

 

 

September 30,
2020

 

December 31,
2019

ASSETS

 

 

 

Cash and cash equivalents

$

215,304

 

 

$

195,540

 

Accounts receivable, net

210,326

 

 

218,271

 

Contract assets, net

104,853

 

 

79,070

 

Inventories

113,107

 

 

95,149

 

Income taxes prepaid and receivable

6,560

 

 

6,162

 

Prepaid expenses and other current assets

30,485

 

 

24,142

 

Total current assets

$

680,635

 

 

$

618,334

 

 

 

 

 

Property, plant and equipment, net

442,469

 

 

466,462

 

Intangibles, net

48,281

 

 

52,892

 

Goodwill

184,287

 

 

180,934

 

Deferred income taxes

38,387

 

 

51,621

 

Noncurrent receivables, net

36,228

 

 

41,234

 

Other assets

60,405

 

 

62,891

 

Total assets

$

1,490,692

 

 

$

1,474,368

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

Accounts payable

$

46,740

 

 

$

65,203

 

Accrued liabilities

119,221

 

 

125,885

 

Current maturities of long-term debt

12

 

 

20

 

Income taxes payable

12,936

 

 

11,611

 

Total current liabilities

178,909

 

 

202,719

 

 

 

 

 

Long-term debt

418,000

 

 

424,009

 

Other noncurrent liabilities

134,903

 

 

132,725

 

Deferred taxes and other liabilities

9,022

 

 

12,226

 

Total liabilities

740,834

 

 

771,679

 

 

 

 

 

SHAREHOLDERS' EQUITY

 

 

 

Preferred stock, par value $5.00 per share; authorized 2,000,000 shares; none issued

 

 

 

Class A Common Stock, par value $0.001 per share; authorized 100,000,000 shares; 39,113,172 issued in 2020 and 39,098,792 in 2019

39

 

 

39

 

Class B Common Stock, par value $0.001 per share; authorized 25,000,000 shares; issued and outstanding 1,617,998 in 2020 and 2019

2

 

 

2

 

Additional paid in capital

432,823

 

 

432,518

 

Retained earnings

749,678

 

 

698,496

 

Accumulated items of other comprehensive income:

 

 

 

Translation adjustments

(119,814

)

 

(122,852

)

Pension and postretirement liability adjustments

(49,436

)

 

(49,994

)

Derivative valuation adjustment

(10,409

)

 

(3,135

)

Treasury stock (Class A), at cost; 8,394,022 shares in 2020 and 8,408,770 shares in 2019

(256,074

)

 

(256,391

)

Total Company shareholders' equity

746,809

 

 

698,683

 

Noncontrolling interest

3,049

 

 

4,006

 

Total equity

749,858

 

 

702,689

 

Total liabilities and shareholders' equity

$

1,490,692

 

 

$

1,474,368

 

ALBANY INTERNATIONAL CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

2020

 

2019

 

2020

 

2019

OPERATING ACTIVITIES

 

 

 

 

 

 

 

Net income

$

29,590

 

 

$

40,125

 

 

$

69,633

 

 

$

103,792

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

Depreciation

16,285

 

 

15,672

 

 

47,289

 

 

46,659

 

Amortization

1,997

 

 

1,582

 

 

7,017

 

 

6,305

 

Change in deferred taxes and other liabilities

3,074

 

 

13,548

 

 

12,434

 

 

12,802

 

Provision for write-off of property, plant and equipment

303

 

 

(5

)

 

536

 

 

1,101

 

Non-cash interest (income)/expense

(309

)

 

151

 

 

(138

)

 

454

 

Compensation and benefits paid or payable in Class A Common Stock

80

 

 

790

 

 

596

 

 

1,413

 

Fair value adjustment on foreign currency option

(64

)

 

 

 

 

 

 

Provision for credit losses from uncollected receivables and contract assets

(105

)

 

332

 

 

1,664

 

 

1,136

 

Foreign currency remeasurement loss/(gain) on intercompany loans

169

 

 

(1,049

)

 

15,750

 

 

(2,656

)

 

 

 

 

 

 

 

 

Changes in operating assets and liabilities that provided/(used) cash:

 

 

 

 

 

 

 

Accounts receivable

(2,048

)

 

(10,282

)

 

6,069

 

 

(8,276

)

Contract assets

(7,923

)

 

(9,605

)

 

(27,932

)

 

(6,558

)

Inventories

4,585

 

 

(3,760

)

 

(20,043

)

 

(21,927

)

Prepaid expenses and other current assets

(4,532

)

 

131

 

 

(6,989

)

 

(4,057

)

Income taxes prepaid and receivable

(454

)

 

304

 

 

(662

)

 

662

 

Accounts payable

(5,108

)

 

363

 

 

(15,491

)

 

7,837

 

Accrued liabilities

2,838

 

 

3,407

 

 

(8,063

)

 

(8,762

)

Income taxes payable

1,786

 

 

(5,611

)

 

3,741

 

 

1,619

 

Noncurrent receivables

(228

)

 

(339

)

 

169

 

 

(679

)

Other noncurrent liabilities

111

 

 

(2,251

)

 

(413

)

 

(4,411

)

Other, net

(388

)

 

(6

)

 

(1,474

)

 

139

 

Net cash provided by operating activities

39,659

 

 

43,497

 

 

83,693

 

 

126,593

 

 

 

 

 

 

 

 

 

INVESTING ACTIVITIES

 

 

 

 

 

 

 

Purchases of property, plant and equipment

(9,349

)

 

(13,442

)

 

(31,320

)

 

(48,846

)

Purchased software

(109

)

 

(257

)

 

(155

)

 

(306

)

Net cash used in investing activities

(9,458

)

 

(13,699

)

 

(31,475

)

 

(49,152

)

 

 

 

 

 

 

 

 

FINANCING ACTIVITIES

 

 

 

 

 

 

 

Proceeds from borrowings

 

 

 

 

70,000

 

 

20,000

 

Principal payments on debt

(17,005

)

 

(58,006

)

 

(76,016

)

 

(95,014

)

Principal payments on finance lease liabilities

(335

)

 

(298

)

 

(6,798

)

 

(876

)

Taxes paid in lieu of share issuance

 

 

 

 

(490

)

 

(971

)

Proceeds from options exercised

5

 

 

33

 

 

25

 

 

105

 

Dividends paid

(6,144

)

 

(5,814

)

 

(18,424

)

 

(17,435

)

Net cash used in financing activities

(23,479

)

 

(64,085

)

 

(31,703

)

 

(94,191

)

 

 

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

4,545

 

 

(7,207

)

 

(751

)

 

(7,266

)

 

 

 

 

 

 

 

 

Increase/(decrease) in cash and cash equivalents

11,267

 

 

(41,494

)

 

19,764

 

 

(24,016

)

Cash and cash equivalents at beginning of period

204,037

 

 

215,233

 

 

195,540

 

 

197,755

 

Cash and cash equivalents at end of period

$

215,304

 

 

$

173,739

 

 

$

215,304

 

 

$

173,739

 

Reconciliation of non-GAAP measures to comparable GAAP measures

The following tables present Net sales and the effect of changes in currency translation rates:

(in thousands, except percentages)

 

Net sales as
reported, Q3
2020

 

Increase due to
changes in
currency
translation rates

 

Q3 2020 sales
on same basis
as Q3 2019
currency
translation rates

 

Net sales as
reported, Q3
2019

 

% Change compared
to Q3 2019,
excluding currency
rate effects

Machine Clothing

$

138,747

 

$

1,837

 

$

136,910

 

$

151,324

 

(9.5

)

%

Albany Engineered Composites

73,252

 

350

 

72,902

 

119,809

 

(39.2

)

%

Consolidated total

$

211,999

 

$

2,187

 

$

209,812

 

$

271,133

 

(22.6

)

%

 

 

 

 

 

 

(in thousands, except percentages)

 

Net sales as
reported, YTD
2020

 

Decrease due to
changes in
currency
translation rates

 

YTD 2020 sales
on same basis
as 2019
currency
translation rates

 

Net sales as
reported, YTD
2019

 

% Change compared
to 2019,
excluding currency
rate effects

Machine Clothing

$

428,782

 

$

(1,287

)

$

430,069

 

$

450,673

 

(4.6

)

%

Albany Engineered Composites

244,971

 

(136

)

245,107

 

345,781

 

(29.1

)

%

Consolidated total

$

673,753

 

$

(1,423

)

$

675,176

 

$

796,454

 

(15.2

)

%

The following tables present Gross profit and Gross profit margin:

(in thousands, except percentages)

Gross profit,
Q3 2020

Gross profit margin,
Q3 2020

Gross profit,
Q3 2019

Gross profit margin,
Q3 2019

Machine Clothing

$

71,471

 

51.5

%

$

79,225

 

52.4

%

Albany Engineered Composites

15,831

 

21.6

%

24,882

 

20.8

%

Consolidated total

$

87,302

 

41.2

%

$

104,107

 

38.4

%

 

 

 

 

 

(in thousands, except percentages)

Gross profit,
YTD 2020

Gross profit margin,
YTD 2020

Gross profit,
YTD 2019

Gross profit margin,
YTD 2019

Machine Clothing

$

227,734

 

53.1

%

$

234,040

 

51.9

%

Albany Engineered Composites

52,020

 

21.2

%

67,020

 

19.4

%

Consolidated total

$

279,754

 

41.5

%

$

301,060

 

37.8

%

 

 

 

 

 

Adjusted EBITDA for the current-year and comparable prior-year periods has been calculated as follows:

Three months ended September 30, 2020

(in thousands)

Machine Clothing

Albany Engineered
Composites

Corporate expenses
and other

Total Company

Operating income/(loss) (GAAP)

$

45,699

 

$

6,828

 

$

(13,754)

 

$

38,773

 

Interest, taxes, other income/(expense)

 

 

(9,183)

 

(9,183)

 

Net income/(loss) (GAAP)

45,699

 

6,828

 

(22,937)

 

29,590

 

Interest expense, net

 

 

2,242

 

2,242

 

Income tax expense

 

 

9,686

 

9,686

 

Depreciation and amortization expense

5,074

 

12,236

 

972

 

18,282

 

EBITDA (non-GAAP)

50,773

 

19,064

 

(10,037)

 

59,800

 

Restructuring expenses

384

 

358

 

(32)

 

710

 

Foreign currency revaluation (gains)/losses

1,422

 

(226)

 

(144)

 

1,052

 

Acquisition/integration costs

 

291

 

 

291

 

Pre-tax (income) attributable to noncontrolling interest

 

(22)

 

 

(22)

 

Adjusted EBITDA (non-GAAP)

$

52,579

 

$

19,465

 

$

(10,213)

 

$

61,831

 

Adjusted EBITDA margin (Adjusted EBITDA divided by Net sales-non-GAAP)

37.9

%

26.6

%

 

29.2

%

 

 

 

 

 

 

 

 

 

 

Three months ended September 30, 2019

(in thousands)

Machine Clothing

Albany Engineered
Composites

Corporate expenses
and other

Total Company

Operating income/(loss) (GAAP)

$

51,906

 

$

17,345

 

$

(13,573)

 

$

55,678

 

Interest, taxes, other income/(expense)

 

 

(15,553)

 

(15,553)

 

Net income/(loss) (GAAP)

51,906

 

17,345

 

(29,126)

 

40,125

 

Interest expense, net

 

 

3,987

 

3,987

 

Income tax expense

 

 

13,194

 

13,194

 

Depreciation and amortization expense

5,149

 

11,087

 

1,018

 

17,254

 

EBITDA (non-GAAP)

57,055

 

28,432

 

(10,927)

 

74,560

 

Restructuring expenses

(211)

 

(33)

 

 

(244)

 

Foreign currency revaluation (gains)/losses

(1,021)

 

341

 

(2,026)

 

(2,706)

 

Pre-tax (income) attributable to noncontrolling interest

 

(161)

 

 

(161)

 

Adjusted EBITDA (non-GAAP)

$

55,823

 

$

28,579

 

$

(12,953)

 

$

71,449

 

Adjusted EBITDA margin (Adjusted EBITDA divided by Net sales-non-GAAP)

36.9

%

23.9

%

 

26.4

%

Nine months ended September 30, 2020

(in thousands)

Machine Clothing

 

Albany Engineered
Composites

 

Corporate expenses
and other

 

Total Company

Operating income/(loss) (GAAP)

$

149,418

 

$

22,749

 

$

(41,073)

 

$

131,094

 

Interest, taxes, other income/(expense)

 

 

(61,461)

 

(61,461)

 

Net income/(loss) (GAAP)

149,418

 

22,749

 

(102,534)

 

69,633

 

Interest expense, net

 

 

10,042

 

10,042

 

Income tax expense

 

 

37,504

 

37,504

 

Depreciation and amortization expense

15,142

 

36,192

 

2,972

 

54,306

 

EBITDA (non-GAAP)

164,560

 

58,941

 

(52,016)

 

171,485

 

Restructuring expenses

1,414

 

2,606

 

169

 

4,189

 

Foreign currency revaluation (gains)/losses

(1,265)

 

501

 

14,705

 

13,941

 

Former CEO termination costs

 

 

2,742

 

2,742

 

Acquisition/integration costs

 

867

 

 

867

 

Pre-tax loss attributable to noncontrolling interest

 

1,412

 

 

1,412

 

Adjusted EBITDA (non-GAAP)

164,709

 

64,327

 

(34,400)

 

194,636

 

Adjusted EBITDA margin (Adjusted EBITDA divided by Net sales-non-GAAP)

38.4

%

26.3

%

 

28.9

%

 

 

 

 

 

 

 

 

 

 

Nine months ended September 30, 2019

(in thousands)

Machine Clothing

 

Albany Engineered
Composites

 

Corporate expenses
and other

 

Total Company

Operating income/(loss) (GAAP)

$

145,688

 

$

44,598

 

$

(40,290)

 

$

149,996

 

Interest, taxes, other income/(expense)

 

 

(46,204)

 

(46,204)

 

Net income/(loss) (GAAP)

145,688

 

44,598

 

(86,494)

 

103,792

 

Interest expense, net

 

 

13,035

 

13,035

 

Income tax expense

 

 

35,075

 

35,075

 

Depreciation and amortization expense

16,674

 

33,059

 

3,231

 

52,964

 

EBITDA (non-GAAP)

162,362

 

77,657

 

(35,153)

 

204,866

 

Restructuring expenses

1,125

 

18

 

(4)

 

1,139

 

Foreign currency revaluation (gains)/losses

(734)

 

655

 

(3,716)

 

(3,795)

 

Pre-tax (income) attributable to noncontrolling interest

 

(722)

 

 

(722)

 

Adjusted EBITDA (non-GAAP)

$

162,753

 

$

77,608

 

$

(38,873)

 

$

201,488

 

Adjusted EBITDA margin (Adjusted EBITDA divided by Net sales-non-GAAP)

36.1

%

22.4

%

 

25.3

%

 

 

 

 

 

Per share impact of the adjustments to earnings per share are as follows:

Three months ended September 30, 2020
(in thousands, except per share amounts)

Pre tax
Amounts

Tax
Effect

After tax
Effect

Per share
Effect

Restructuring expenses

$

710

 

$

232

 

$

478

 

$

0.01

 

Foreign currency revaluation (gains)/losses

1,052

 

526

 

526

 

0.02

 

Acquisition/integration costs

291

 

87

 

204

 

0.01

 

 

 

 

 

 

Three months ended September 30, 2019
(in thousands, except per share amounts)

Pre tax
Amounts

Tax
Effect

After tax
Effect

Per share
Effect

Restructuring expenses

$

(244

)

$

(67

)

$

(177

)

$

(0.01

)

Foreign currency revaluation (gains)/losses

(2,706

)

(744

)

(1,962

)

(0.06

)

 

 

 

 

 

Nine months ended September 30, 2020
(in thousands, except per share amounts)

Pre tax
Amounts

Tax
Effect

After tax
Effect

Per share
Effect

Restructuring expenses

$

4,189

 

$

1,377

 

$

2,812

 

$

0.08

 

Foreign currency revaluation (gains)/losses(a)

13,941

 

(483

)

14,424

 

0.46

 

Former CEO termination costs

2,742

 

713

 

2,029

 

0.06

 

Acquisition/integration costs

867

 

259

 

608

 

0.03

 

 

 

 

 

 

(a) In Q1 2020, the company recorded losses of approximately $17 million in jurisdictions where it cannot record a tax benefit from the losses, which results in an unusual relationship between the pre-tax and after-tax amounts.

 

 

 

 

 

 

Nine months ended September 30, 2019
(in thousands, except per share amounts)

Pre tax
Amounts

Tax
Effect

After tax
Effect

Per share
Effect

Restructuring expenses

$

1,139

 

$

330

 

$

809

 

$

0.02

 

Foreign currency revaluation (gains)/losses

(3,795

)

(1,073

)

(2,722

)

(0.08

)

 

The following table provides a reconciliation of Earnings per share to Adjusted Earnings per share:

 

Three months ended September 30,

 

Nine months ended September 30,

Per share amounts (Basic)

2020

 

2019

 

2020

 

2019

Earnings per share (GAAP)

$

0.92

 

$

1.24

 

$

2.20

 

$

3.20

 

Adjustments, after tax:

 

 

 

 

Restructuring expenses

0.01

 

(0.01

)

0.08

 

0.02

 

Foreign currency revaluation (gains)/losses

0.02

 

(0.06

)

0.46

 

(0.08

)

Former CEO termination costs

 

 

0.06

 

 

Acquisition/integration costs

0.01

 

 

0.03

 

 

Adjusted Earnings per share

$

0.96

 

$

1.17

 

$

2.83

 

$

3.14

 

The calculations of net debt are as follows:

(in thousands)

September 30, 2020

 

June 30, 2020

 

March 31, 2020

 

December 31, 2019

Current maturities of long-term debt

$

12

 

$

17

 

$

20

 

$

20

 

Long-term debt

418,000

 

435,000

 

491,002

 

424,009

 

Total debt

418,012

 

435,017

 

491,022

 

424,029

 

Cash and cash equivalents

215,304

 

204,037

 

222,680

 

195,540

 

Net debt

$

202,708

 

$

230,980

 

$

268,342

 

$

228,489

 

The tables below provide a reconciliation of forecasted full-year 2020 Adjusted EBITDA and Adjusted EPS (non-GAAP measures) to the comparable GAAP measures:

Forecast of Full Year 2020 Adjusted EBITDA

Machine Clothing

 

AEC

(in millions)

Low

 

High

 

Low

 

High

Net income attributable to the Company (GAAP) (b)

$

181

 

$

189

 

 

$

24

 

$

32

 

Income attributable to the noncontrolling interest

 

 

 

(1

)

(1

)

Interest expense, net

 

 

 

 

 

Income tax expense

 

 

 

 

 

Depreciation and amortization

19

 

21

 

 

47

 

49

 

EBITDA (non-GAAP)

200

 

210

 

 

70

 

80

 

Restructuring expenses, net (c)

1

 

1

 

 

3

 

3

 

Foreign currency revaluation (gains)/losses (c)

(1

)

(1

)

 

 

 

Acquisition/integration costs (c)

 

 

 

1

 

1

 

Pre-tax (income)/loss attributable to non-controlling interest

 

 

 

1

 

1

 

Adjusted EBITDA (non-GAAP)

$

200

 

$

210

 

 

$

75

 

$

85

 

(b) Interest, Other income/expense and Income taxes are not allocated to the business segments

 

 

 

 

 

 

Forecast of Full Year 2020 Adjusted EBITDA

Total Company

 

 

 

(in millions)

Low

 

High

 

 

 

Net income attributable to the Company (GAAP)

$

88

 

$

91

 

 

 

 

Income attributable to the noncontrolling interest

(1

)

(1

)

 

 

 

Interest expense, net

13

 

14

 

 

 

 

Income tax expense

47

 

48

 

 

 

 

Depreciation and amortization

70

 

75

 

 

 

 

EBITDA (non-GAAP)

217

 

227

 

 

 

 

Restructuring expenses, net (c)

4

 

4

 

 

 

 

Foreign currency revaluation (gains)/losses (c)

14

 

14

 

 

 

 

Former CEO termination costs

3

 

3

 

 

 

 

Acquisition/integration costs (c)

1

 

1

 

 

 

 

Pre-tax (income)/loss attributable to non-controlling interest

1

 

1

 

 

 

 

Adjusted EBITDA (non-GAAP)

$

240

 

$

250

 

 

 

 

 

 

 

 

 

 

 

Total Company

 

 

 

Forecast of Full Year 2020 Earnings per share (basic) (d)

Low

 

High

 

 

 

Net income attributable to the Company (GAAP)

$

2.72

 

$

2.82

 

 

 

 

Restructuring expenses, net (c)

0.08

 

0.08

 

 

 

 

Foreign currency revaluation (gains)/losses (c)

0.46

 

0.46

 

 

 

 

Former CEO termination costs

0.06

 

0.06

 

 

 

 

Acquisition/integration costs (c)

0.03

 

0.03

 

 

 

 

Adjusted Earnings per share (non-GAAP)

$

3.35

 

$

3.45

 

 

 

 

 

 

 

 

 

 

(c) Due to the uncertainty of these items, we are unable to forecast these items for 2020; the amount shown represents the value incurred through the third quarter.

(d) Calculations based on shares outstanding estimate of 32.3 million.

About Albany International Corp.

Albany International is a global advanced textiles and materials processing company, with two core businesses. The Machine Clothing segment is the world’s leading producer of custom-designed fabrics and belts essential to production in the paper, nonwovens, and other process industries. Albany Engineered Composites is a rapidly growing supplier of highly engineered composite parts for the aerospace industry. Albany International is headquartered in Rochester, New Hampshire, operates 23 plants in 11 countries, employs over 4,000 people worldwide, and is listed on the New York Stock Exchange (Symbol AIN). Additional information about the Company and its products and services can be found at www.albint.com.

Non-GAAP Measures

This release, including the conference call commentary associated with this release, contains certain non-GAAP measures, including: net sales, and percent change in net sales, excluding the impact of currency translation effects (for each segment and on a consolidated basis); EBITDA and Adjusted EBITDA (for each segment and on a consolidated basis, represented in dollars or as a percentage of net sales); Net debt; and Adjusted earnings per share (or Adjusted EPS). Such items are provided because management believes that they provide additional useful information to investors regarding the Company’s operational performance.

Presenting Net sales and increases or decreases in Net sales, after currency effects are excluded, can give management and investors insight into underlying sales trends. Net sales, or percent changes in net sales, excluding currency rate effects, are calculated by converting amounts reported in local currencies into U.S. dollars at the exchange rate of a prior period. These amounts are then compared to the U.S. dollar amount as reported in the current period.

EBITDA, Adjusted EBITDA and Adjusted EPS are performance measures that relate to the Company’s continuing operations. EBITDA, or net income with interest, taxes, depreciation, and amortization added back, is a common indicator of financial performance used, among other things, to analyze and compare core profitability between companies and industries because it eliminates effects due to differences in financing, asset bases and taxes. The Company calculates EBITDA by removing the following from Net income: Interest expense, net, Income tax expense, Depreciation and amortization expense. Adjusted EBITDA is calculated by: adding to EBITDA costs associated with restructuring, former CEO termination costs, and inventory write-offs associated with discontinued businesses; adding charges and credits related to pension plan settlements and curtailments; adding (or subtracting) revaluation losses (or gains); subtracting (or adding) gains (or losses) from the sale of buildings or investments; subtracting insurance recovery gains in excess of previously recorded losses; adding acquisition and related retention agreement expenses and subtracting (or adding) Income (or loss) attributable to the non-controlling interest in Albany Safran Composites (ASC). Adjusted EBITDA may also be presented as a percentage of net sales by dividing it by net sales. An understanding of the impact in a particular quarter of specific restructuring costs, former CEO severance costs, acquisition and related retention agreement expenses, currency revaluation, inventory write-offs associated with discontinued businesses, or other gains and losses, on net income (absolute as well as on a per-share basis), operating income or EBITDA can give management and investors additional insight into core financial performance, especially when compared to quarters in which such items had a greater or lesser effect, or no effect. Restructuring expenses in the MC segment, while frequent in recent years, are reflective of significant reductions in manufacturing capacity and associated headcount in response to shifting markets, and not of the profitability of the business going forward as restructured. Adjusted earnings per share (Adjusted EPS) is calculated by adding to (or subtracting from) net income attributable to the Company per share, on an after-tax basis: restructuring charges; former CEO severance costs; charges and credits related to pension plan settlements and curtailments; inventory write-offs associated with discontinued businesses; foreign currency revaluation losses (or gains); acquisition-related expenses; and losses (or gains) from the sale of investments.

EBITDA, Adjusted EBITDA, and Adjusted EPS, as defined by the Company, may not be similar to similarly named measures of other companies. Such measures are not considered measurements under GAAP, and should be considered in addition to, but not as substitutes for, the information contained in the Company’s statements of income.

The Company discloses certain income and expense items on a per-share basis. The Company believes that such disclosures provide important insight into underlying quarterly earnings and are financial performance metrics commonly used by investors. The Company calculates the quarterly per-share amount for items included in continuing operations by using an income tax rate based on either the tax rates in specific countries or the estimated tax rate applied to total company results. The after-tax amount is then divided by the weighted-average number of shares outstanding for each period. Year-to-date earnings per-share effects are determined by adding the amounts calculated at each reporting period.

Net debt is, in the opinion of the Company, helpful to investors wishing to understand what the Company’s debt position would be if all available cash were applied to pay down indebtedness. The Company calculates Net debt by subtracting Cash and cash equivalents from Total debt. Total debt is calculated by adding Long-term debt, Current maturities of long-term debt, and Notes and loans payable, if any.

Forward-Looking Statements

This press release may contain statements, estimates, guidance or projections that constitute “forward-looking statements” as defined under U.S. federal securities laws. Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “will,” “should,” “look for,” “guidance,” “guide,” and similar expressions identify forward-looking statements, which generally are not historical in nature. Because forward-looking statements are subject to certain risks and uncertainties (including, without limitation, those set forth in the Company’s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q), actual results may differ materially from those expressed or implied by such forward-looking statements.

Forward-looking statements in this release or in the webcast include, without limitation, statements about macroeconomic and paper-industry trends and conditions during 2020 and in future years; expectations in 2020 and in future periods of sales, EBITDA, Adjusted EBITDA (both in dollars and as a percentage of net sales), Adjusted EPS, income, gross profit, gross margin, cash flows and other financial items in each of the Company’s businesses, and for the Company as a whole; the timing and impact of production and development programs in the Company’s AEC business segment and the sales growth potential of key AEC programs, as well as AEC as a whole; the amount and timing of capital expenditures, future tax rates and cash paid for taxes, depreciation and amortization; future debt and net debt levels and debt covenant ratios; and changes in currency rates and their impact on future revaluation gains and losses. Furthermore, a change in any one or more of the foregoing factors could have a material effect on the Company’s financial results in any period. Such statements are based on current expectations, and the Company undertakes no obligation to publicly update or revise any forward-looking statements.

Statements expressing management’s assessments of the growth potential of its businesses, or referring to earlier assessments of such potential, are not intended as forecasts of actual future growth, and should not be relied on as such. While management believes such assessments to have a reasonable basis, such assessments are, by their nature, inherently uncertain. This release and earlier releases set forth a number of assumptions regarding these assessments, including historical results, independent forecasts regarding the markets in which these businesses operate, and the timing and magnitude of orders for our customers’ products. Historical growth rates are no guarantee of future growth, and such independent forecasts and assumptions could prove materially incorrect in some cases.

Albany International Registered (A) Aktie jetzt über den Testsieger (Finanztest 11/2020) handeln, ab 0 € auf Smartbroker.de



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Disclaimer

Albany International Reports Third-Quarter 2020 Results Albany International Corp. (NYSE:AIN) today reported operating results for its third quarter of 2020, which ended September 30, 2020. "Our top priority remains the health and safety of our employees, and I am proud of our employees' commitment to …

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