Hayes Lemmerz Reports 4.0% Sales Gain for Fiscal Quarter Ended April 30, 2005 Due to Strong International Demand
June 08 2005 - 8:16AM
PR Newswire (US)
Hayes Lemmerz Reports 4.0% Sales Gain for Fiscal Quarter Ended
April 30, 2005 Due to Strong International Demand Company Improved
Liquidity During Quarter NORTHVILLE, Mich., June 8
/PRNewswire-FirstCall/ -- Hayes Lemmerz International, Inc.
(NASDAQ:HAYZ) today reported that sales for the fiscal first
quarter ended April 30, 2005 rose 4.0 percent to $618.0 million,
compared with $594.0 million a year earlier. Earnings from
operations for the fiscal first quarter were $14.8 million, down
from $28.2 million a year earlier. For the quarter, the Company
reported a net loss of $7.7 million, compared with a year earlier
profit of $1.1 million. "Despite reduced volume in the U.S., we had
strong growth in our international business -- particularly in
Europe where we have become the number one automotive steel and
aluminum wheel supplier to Toyota, and the number one aluminum
wheel supplier to Honda and Nissan/Renault -- which fueled our
increased sales in the quarter," said Curtis Clawson, President,
CEO and Chairman of the Board. "Our international diversification
continues to pay dividends, as international sales rose 19.9
percent to $325.6 million compared to $271.5 million a year
earlier, and accounted for 53 percent of our total sales in the
recent quarter compared with 46 percent a year earlier." "Hayes
Lemmerz is also benefiting from its continued investment in serving
the global medium and heavy duty truck markets. First quarter sales
of steel wheels for commercial vehicles rose about 6 percent in
both North America and international markets," Mr. Clawson said.
"Sales during the quarter were also helped by partial recovery of
increased steel prices and favorable currency exchange rates," he
said. "Unfortunately, production requirements from some U.S. auto
producers were down 10 percent in the fiscal first quarter from the
same period a year ago, reflecting sharply decreased demand for
larger vehicles, which happen to be key platforms for Hayes
Lemmerz," said Mr. Clawson. "There's no denying that this is a
difficult time for automotive components manufacturers, but the
steps we have taken in the past few years to reduce operating
costs, diversify geographically, and focus on meeting customer
needs have all contributed to our current results, which I consider
exemplary given market conditions," Mr. Clawson said. "We have
negotiated contracts with steel suppliers to stabilize the rapidly
rising steel prices we had faced in earlier quarters, and
negotiated acceptable recovery from customers to help mitigate
higher raw materials prices." "The Company also completed a number
of recent initiatives to improve its overall liquidity," Mr.
Clawson added. In April 2005, the Company completed a new $150
million second-lien term loan from which approximately $70 million
of proceeds were used to repay a portion of the existing first-lien
term loan and $75 million was made available for general corporate
purposes. In May 2005, the Company amended its $75 million domestic
accounts receivable securitization program to mitigate the impact
of some U.S. customers' credit rating downgrades on program
availability. As of April 30, 2005, the Company had $42 million of
cash and available borrowing capacity of approximately $82 million
under its revolving credit facility. Net debt as of April 30, 2005
was $677.4 million and debt amortization requirements for the
remainder of fiscal 2005 and fiscal 2006 total approximately $28
million. The Company also confirmed its earnings guidance and
outlook for 2005. The Company expects total revenue to be
approximately $2.3 billion to $2.4 billion and Adjusted EBITDA(1)
to be approximately $220 million to $235 million, while free cash
flow is expected to be negative -- the latter category downgraded
from "slightly negative" due to the impact of reduced availability
of the receivables securitization program to finance receivables of
some U.S. customers for the remainder of 2005. Hayes Lemmerz will
host a telephone conference call to discuss the Company's fiscal
year 2005 first quarter financial results today at 9:30 a.m. (ET).
To participate by phone, please dial 10 minutes prior to the call:
(800) 399-3882 from the United States and Canada or (706) 643-7483
from outside the United States. Callers should ask to be connected
to the Hayes Lemmerz earnings conference call, Conference ID#
6313982. The conference call will be accompanied by a slide
presentation, which can be accessed that morning through the
Company's web site, in the Investor Kit presentations section at
http://www.hayes-lemmerz.com/investor_kit/html/presentations.html.
A replay of the call will be available from 11:00 a.m. (ET), June
8, 2005 until 11:59 p.m. (ET), June 15, 2005, by calling (800)
642-1687 (within the United States and Canada) or (706) 645-9291
(for international calls). Please refer to Conference ID#6313982.
An audio replay of the call is expected to be available on the
Company's website beginning 48 hours after completion of the call.
Hayes Lemmerz International, Inc. is a leading global supplier of
automotive and commercial highway wheels, brakes, powertrain,
suspension, structural and other lightweight components. The
Company has 42 facilities and has approximately 11,000 employees
worldwide. (1) EBITDA, a measure used by management to measure
operating performance, is defined as earnings from operations plus
depreciation and amortization. Adjusted EBITDA is defined as EBITDA
further adjusted to exclude: (i) asset impairment losses and other
restructuring charges; (ii) reorganization items; and (iii) other
items. Management references these non-GAAP financial measures
frequently in its decision making because they provide supplemental
information that facilitates internal comparisons to historical
operating performance of prior periods and external comparisons to
competitors' historical operating performance. Adjusted EBITDA is
not a recognized term under GAAP and does not purport to be an
alternative to earnings from operations as an indicator of
operating performance or to cash flows from operating activities as
a measure of liquidity. Because not all companies use identical
calculations, these presentations of Adjusted EBITDA may not be
comparable to other similarly titled measures of other companies.
Additionally, Adjusted EBITDA is not intended to be a measure of
free cash flow for management's discretionary use, as it does not
consider certain cash requirements such as interest payments, tax
payments and debt service requirements. Institutional investors
generally look to Adjusted EBITDA in measuring performance, among
other things. The Company uses Adjusted EBITDA to facilitate
quantification of planned business activities and enhance
subsequent follow-up with comparisons of actual to planned Adjusted
EBITDA. The Company is disclosing these non-GAAP financial measures
in order to provide transparency to investors. This press release
includes 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, as amended, which represent the Company's
expectations and beliefs concerning future events that involve
risks and uncertainties which could cause actual results to differ
materially from those currently anticipated. All statements other
than statements of historical facts included in this release are
forward looking statements. Factors that could cause actual results
to differ materially from those expressed or implied in such
forward looking statements include the factors set forth in our
periodic reports filed with the SEC. Consequently, all of the
forward looking statements made in this press release are qualified
by these and other factors, risks, and uncertainties. HAYES LEMMERZ
INTERNATIONAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF
OPERATIONS (Dollars in millions, except per share amounts)
Unaudited Three Months Ended Three Months Ended April 30, 2005
April 30, 2004 Net sales $618.0 $594.0 Cost of goods sold 555.8
519.7 Gross profit 62.2 74.3 Marketing, general, and administrative
43.8 43.1 Asset impairments and other restructuring charges 0.8 2.4
Other expense, net 2.8 0.6 Earnings from operations 14.8 28.2
Interest expense, net 14.7 9.5 Other non-operating expense 0.2 -
Loss on early extinguishment of debt - 12.2 Earnings (loss) before
taxes on income, minority interest, and cumulative effect of change
in accounting principle (0.1) 6.5 Income tax expense 5.0 5.8
Earnings (loss) before minority interest and cumulative effect of
change in accounting principle (5.1) 0.7 Minority interest 2.6 2.2
Loss before cumulative effect of change in accounting principle
(7.7) (1.5) Cumulative effect of change in accounting principle,
net of tax of $0.8 - (2.6) Net income (loss) $(7.7) $1.1 Basic and
diluted: Loss before cumulative effect of change in accounting
principle $(0.20) $(0.04) Cumulative effect of change in accounting
principle, net of tax of $0.8 - (0.07) Net income (loss) $(0.20)
$0.03 HAYES LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED
CONSOLIDATED BALANCE SHEETS (Dollars in millions) Unaudited April
30, 2005 January 31, 2005 ASSETS Current assets: Cash and cash
equivalents $42.2 $35.2 Receivables 272.8 241.4 Other Receivables
126.7 77.0 Inventories 233.6 212.6 Prepaid expenses and other
current assets 28.2 29.3 Total current assets 703.5 595.5 Property,
plant, and equipment, net 989.9 1,000.3 Goodwill 410.6 417.9
Intangible assets, net 229.3 233.3 Other assets 62.1 55.0 Total
assets $2,395.4 $2,302.0 LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities: Bank borrowings and other notes $0.4 $0.6
Current portion of long-term debt 9.5 10.5 Accounts payable and
accrued liabilities 439.3 405.3 Total current liabilities 449.2
416.4 Long-term debt, net of current portion 710.1 631.1 Pension
and other long-term liabilities 510.5 507.7 Series A warrants and
Series B warrants 0.1 0.5 Redeemable preferred stock of subsidiary
11.5 11.3 Minority interest 35.5 33.7 Stockholders' equity 678.5
701.3 Total liabilities and stockholders' equity $2,395.4 $2,302.0
HAYES LEMMERZ INTERNATIONAL, INC. AND SUBSIDIARIES CONDENSED
CONSOLIDATED CASH FLOW STATEMENT (Dollars in millions) Unaudited
Three Months Ended Three Months Ended April 30, 2005 April 30, 2004
Cash provided by (used for) operating activities $(37.5) $85.0 Cash
flows from investing activities: Purchase of property, plant,
equipment, and tooling (36.5) (33.4) Proceeds from sale of assets -
0.4 Cash used for investing activities (36.5) (33.0) Cash flows
from financing activities: Changes in bank borrowings and credit
facilities (0.2) (0.1) Net proceeds from issuance of common stock -
117.0 Redemption of Senior Notes, net of discount and related fees
- (96.7) Repayment of Term Loan B, net of related fees (70.5)
(16.0) Borrowings from Term Loan C 150.0 - Repayment of long-term
debt (0.2) (2.2) Repayment of notes payable issued in connection
with purchases of - (7.1) businesses Cash provided by (used for)
financing activities 79.1 (5.1) Effect of exchange rate changes on
cash and cash equivalents 1.9 (1.7) Increase in cash and cash
equivalents 7.0 45.2 Adjustment for the elimination of the one
month lag - 1.4 Cash and cash equivalents at beginning of period
35.2 48.5 Cash and cash equivalents at end of period $42.2 $95.1
DATASOURCE: Hayes Lemmerz International, Inc. CONTACT: Marika P.
Diamond, +1-734-737-5162, for Hayes Lemmerz International, Inc.
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