PITTSBURGH, May 7, 2020 /PRNewswire/ -- Koppers Holdings
Inc. (NYSE: KOP), an integrated global provider of treated wood
products, wood treatment chemicals and carbon compounds, today
reported a net loss attributable to Koppers for the first quarter
of $1.4 million, or $(0.07) per diluted share, compared to net income
of $11.6 million, or $0.56 per diluted share, in the prior year
quarter. Beginning in 2020, results of Koppers (Jiangsu) Carbon Chemical Company Limited
(KJCC) are classified as held for sale and as discontinued
operations for the current year as well as the comparable prior
year period due to its pending divestiture. Net income from
continuing operations attributable to Koppers for the first quarter
of 2020 was $1.9 million, or
$0.09 per diluted share, compared to
$9.8 million, or $0.47 per diluted share, in the prior year
quarter.
The adjusted net income and adjusted earnings per share (EPS)
from continuing operations were $9.9
million and $0.47 per share
for the first quarter of 2020, compared to $11.4 million and $0.55 per share in the prior year quarter,
respectively.
Adjustments to pre-tax income totaled $10.6 million for the first quarter of 2020,
compared with $3.9 million for the
prior year quarter. For both periods, the adjustments included
restructuring expenses as well as non-cash effects related to LIFO
and mark-to-market commodity hedging.
The operating profit was $13.6
million, or 3.4 percent, compared with $24.3 million, or 6.4 percent, in the prior year
period. The operating profit margin is calculated as a
percentage of sales.
For the first quarter of 2020, adjusted earnings before
interest, taxes, depreciation and amortization (EBITDA) was
$37.6 million, or 9.4 percent,
compared with $40.8 million, or 10.8
percent, in the prior year quarter. The adjusted EBITDA
margin is calculated as a percentage of sales.
Additional items excluded from adjusted EBITDA in the first
quarter of 2020 totaled $10.0 million
of pre-tax charges, compared with $2.3
million in the prior year quarter. For both periods,
the adjustments included restructuring expenses as well as non-cash
effects related to LIFO and mark-to-market commodity hedging.
Consolidated sales were $401.9
million for the first quarter of 2020, an increase of
$25.0 million, or 6.6 percent, from
sales of $376.9 million in the prior
year quarter. Excluding a negative impact from foreign
currency translation of $6.3 million,
sales were higher by $31.3 million,
or 8.3 percent.
The Railroad and Utility Products and Services (RUPS)
performance reflected a generally favorable demand environment with
increased crosstie volumes and favorable pricing in its commercial
crosstie business as well as higher volumes of utility poles,
partially offset by continued weaker demand in its Railroad
Structures and Recovery Resources businesses. The Performance
Chemicals (PC) segment reported higher sales and profitability, on
an adjusted basis, driven by organic growth as well as market share
gains primarily in North America
and lower year-over-year raw material costs, partially offset by
lower demand in its European business. The Carbon Materials
and Chemicals (CMC) business was negatively affected by softening
demand in the global aluminum markets, and lower pricing and
inventory write-downs due to the steep decline in oil prices.
President and CEO Leroy Ball
said, "Final results for the first quarter were in line with what
was communicated in our press release issued on April 27, 2020. I look forward to providing
all stakeholders with details about our operations as we navigate
through the challenges brought on by the COVID-19 pandemic when we
have our next monthly business update on May
20, 2020."
First-Quarter Financial Performance
- Sales for RUPS of $190.0 million
increased by $23.9 million, or 14.4
percent, compared to sales of $166.1
million in the prior year quarter. Excluding an unfavorable
impact from foreign currency translation of $1.0 million, sales increased by $24.9 million, or 15.0 percent, from the prior
year quarter. The sales increase was primarily due to higher
volumes in Class I and commercial crosstie markets, and domestic
and Australian utility pole markets as well as favorable pricing in
the commercial crosstie market, partially offset by lower demand in
maintenance-of-way businesses and an unfavorable foreign currency
impact. Operating profit for the first quarter was $9.2 million, or 4.8 percent, compared with
operating profit of $8.7 million, or
5.2 percent, in the prior year quarter. Adjusted EBITDA for the
first quarter was $13.4 million, or
7.1 percent, compared with $14.3
million, or 8.6 percent, in the prior year quarter. The
lower profitability was primarily due to a decrease in the
maintenance-of-way business and work restrictions related to
additional COVID-19 safety protocols, partially offset by stronger
demand in the treated wood markets for crossties and utility
poles.
- Sales for PC of $111.4 million
increased by $12.4 million, or 12.5
percent, compared to sales of $99.0
million in the prior year quarter. Excluding an unfavorable
impact from foreign currency translation of $1.9 million, sales increased by $14.3 million, or 14.4 percent, from the prior
year quarter. Despite the global pandemic, sales increased due to
higher demand for copper-based preservatives in North America from organic growth as well as
new customer volumes, partially offset by lower demand in
Europe and an unfavorable currency
impact. Operating profit was $4.1
million, or 3.7 percent, for the first quarter, compared
with $12.8 million, or 12.9 percent,
in the prior year quarter. The year-over-year decrease was due to
$11.0 million of mark-to-market
copper hedging losses when comparing the quarters of each year, as
well as insurance proceeds received in the prior year period.
Adjusted EBITDA was $17.0 million, or
15.3 percent, for the first quarter, compared with $15.5 million, or 15.7 percent, in the prior year
quarter. The year-over-year increase in profitability was due to
higher sales volumes and lower year-over-year raw material
prices.
- Sales for CMC totaling $100.5
million decreased by $11.3
million, or 10.1 percent, compared to sales of $111.8 million in the prior year quarter.
Excluding an unfavorable impact from foreign currency translation
of $3.4 million, sales decreased by
$7.9 million, or 7.1 percent, from
the prior year quarter. The decrease was due mainly to lower
pricing of carbon pitch globally as well as lower sales volumes of
carbon pitch in North America.
Operating profit was $0.7 million, or
0.7 percent, in the first quarter, compared with $3.3 million, or 3.0 percent, in the prior year
quarter. Adjusted EBITDA was $7.0
million, or 7.0 percent in the first quarter, compared with
$11.5 million, or 10.3 percent, in
the prior year quarter. The profitability declined from prior year
due to a weaker demand environment, inventory write-downs, and
ongoing pricing pressures.
- Capital expenditures for the three months ended March 31, 2020, were $10.6
million compared with $11.0
million for the prior year period.
- At March 31, 2020, total debt was
$953.2 million and, net of cash and
cash equivalents, the net debt was $899.0
million, compared with total debt of $901.2 million and net debt of $868.9 million at December
31, 2019. By comparison, the net debt was higher by
$30.1 million, primarily due to
typical first quarter working capital increases. At March 31, 2020, the company's net leverage ratio
was 4.5.
Pending Divestiture of Koppers (Jiangsu) Carbon Chemical Company
Limited
In February, Koppers announced that it entered into a definitive
agreement to sell Koppers (Jiangsu) Carbon Chemical Company Limited
(KJCC), a 75-percent owned China
coal tar distillation business with the remaining 25 percent owned
by Yizhou Group Company Limited.
On April 29, 2020, the State
Administration for Market Regulation of China (SAMR) decided not to conduct further
review and gave approval for the pending divestiture to proceed,
which represents a significant step in the process.
Executive Vice President and Chief Operating Officer
James Sullivan said, "I am happy to
report that the work required to be completed prior to closing on
the sale of KJCC is proceeding at a faster pace than originally
anticipated. While we are holding to our original timeline of
closing in August 2020 to account for
any potential delays, I am hopeful that we may be able to close the
transaction in July, based upon our current progress."
Koppers expects to realize approximately $65 million of net cash, after taxes and
expenses, and plans to apply the cash proceeds toward debt
reduction.
About Koppers
Koppers, with corporate headquarters in Pittsburgh, Pennsylvania, is an integrated
global provider of treated wood products, wood treatment chemicals
and carbon compounds. Our products and services are used in a
variety of niche applications in a diverse range of end-markets,
including the railroad, specialty chemical, utility, residential
lumber, agriculture, aluminum, steel, rubber, and construction
industries. Including our joint ventures, we serve our
customers through a comprehensive global manufacturing and
distribution network, with facilities located in North America, South
America, Australasia, China
and Europe. The stock of Koppers Holdings Inc. is publicly
traded on the New York Stock Exchange under the symbol "KOP."
For more information, visit us on the Web: www.koppers.com.
Questions concerning investor relations should be directed to
Michael Zugay at 412-227-2231 or
Quynh McGuire at 412-227-2049.
Non-GAAP Financial Measures
This press release contains certain non-GAAP financial
measures. Koppers believes that adjusted EBITDA, adjusted
EBITDA margin, adjusted net income, adjusted earnings per share,
net debt and net leverage ratio provide information useful to
investors in understanding the underlying operational performance
of the company, its business and performance trends, and facilitate
comparisons between periods and with other corporations in similar
industries. The exclusion of certain items permits evaluation
and a comparison of results for ongoing business operations, and it
is on this basis that Koppers management internally assesses the
company's performance. In addition, the Board of Directors
and executive management team use adjusted EBITDA as a performance
measure under the company's annual incentive plans.
Although Koppers believes that these non-GAAP financial measures
enhance investors' understanding of its business and performance,
these non-GAAP financial measures should not be considered an
alternative to GAAP basis financial measures and should be read in
conjunction with the relevant GAAP financial measure. Other
companies in a similar industry may define or calculate these
measures differently than the company, limiting their usefulness as
comparative measures. Because of these limitations, these
non-GAAP financial measures should not be considered in isolation
or as substitutes for performance measures calculated in accordance
with GAAP.
See the attached tables for the following reconciliations of
non-GAAP financial measures included in this press release:
Unaudited Reconciliation of Operating Profit to EBITDA and Adjusted
EBITDA; Unaudited Reconciliation of Net Income to EBITDA and
Adjusted EBITDA; Unaudited Reconciliation of Net Income
Attributable to Koppers and Adjusted Net Income; Unaudited
Reconciliation of Diluted Earnings Per Share and Adjusted Earnings
Per Share; Unaudited Reconciliation of Total Debt to Net Debt and
Net Leverage Ratio; and Unaudited Reconciliation of Net Income to
EBITDA and Adjusted EBITDA on a Latest Twelve Month Basis.
Safe Harbor Statement
Certain statements in this press release are "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995 and may include, but are not limited to,
statements about sales levels, acquisitions, restructuring,
declines in the value of Koppers assets and the effect of any
resulting impairment charges, profitability and anticipated
expenses and cash outflows. All forward-looking statements
involve risks and uncertainties. All statements contained herein
that are not clearly historical in nature are forward-looking, and
words such as "outlook," "guidance," "forecast," "believe,"
"anticipate," "expect," "estimate," "may," "will," "should,"
"continue," "plan," "potential," "intend," "likely," or other
similar words or phrases are generally intended to identify
forward-looking statements. Any forward-looking statement
contained herein, in other press releases, written statements or
other documents filed with the Securities and Exchange Commission,
or in Koppers communications and discussions with investors and
analysts in the normal course of business through meetings, phone
calls and conference calls, regarding expectations with respect to
sales, earnings, cash flows, operating efficiencies,
restructurings, the benefits of acquisitions, divestitures, joint
ventures or other matters as well as financings and debt reduction,
are subject to known and unknown risks, uncertainties and
contingencies.
Many of these risks, uncertainties and contingencies are beyond
our control, and may cause actual results, performance or
achievements to differ materially from anticipated results,
performance or achievements. Factors that might affect such
forward-looking statements include, among other things, the impact
of changes in commodity prices, such as oil and copper, on product
margins; general economic and business conditions; the length and
extent of economic contraction as a result of the coronavirus
(COVID-19) pandemic; disruption in the U.S. and global financial
markets; potential difficulties in protecting our intellectual
property; the ratings on our debt and our ability to repay or
refinance our outstanding indebtedness as it matures; our ability
to operate within the limitations of our debt covenants; potential
impairment of our goodwill and/or long-lived assets; demand for
Koppers goods and services; competitive conditions; interest rate
and foreign currency rate fluctuations; availability and costs of
key raw materials; unfavorable resolution of claims against us, as
well as those discussed more fully elsewhere in this release and in
documents filed with the Securities and Exchange Commission by
Koppers, particularly our latest annual report on Form 10-K and any
subsequent filings by Koppers with the Securities and Exchange
Commission. Any forward-looking statements in this release
speak only as of the date of this release, and we undertake no
obligation to update any forward-looking statement to reflect
events or circumstances after that date or to reflect the
occurrence of unanticipated events.
Koppers Holdings
Inc.
Unaudited
Condensed Consolidated Statement of Operations
(Dollars in
millions, except per share amounts)
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
Net sales
|
|
$
|
401.9
|
|
|
$
|
376.9
|
|
Cost of
sales
|
|
|
340.3
|
|
|
|
301.8
|
|
Depreciation and
amortization
|
|
|
13.5
|
|
|
|
13.6
|
|
Impairment and
restructuring charges
|
|
|
(0.2)
|
|
|
|
0.3
|
|
Selling, general and
administrative expenses
|
|
|
34.7
|
|
|
|
36.9
|
|
Operating
profit
|
|
|
13.6
|
|
|
|
24.3
|
|
Other income,
net
|
|
|
0.5
|
|
|
|
0.5
|
|
Interest
expense
|
|
|
14.0
|
|
|
|
16.2
|
|
Income from
continuing operations before income taxes
|
|
|
0.1
|
|
|
|
8.6
|
|
Income tax
provision
|
|
|
(1.8)
|
|
|
|
(1.2)
|
|
Income from
continuing operations
|
|
|
1.9
|
|
|
|
9.8
|
|
(Loss) income from
discontinued operations, net
of tax
benefit (expense) of $0.8 and $(1.1)
|
|
|
(4.4)
|
|
|
|
2.7
|
|
Net (loss)
income
|
|
|
(2.5)
|
|
|
|
12.5
|
|
Net (loss) income
attributable to noncontrolling interests
|
|
|
(1.1)
|
|
|
|
0.9
|
|
Net (loss) income
attributable to Koppers
|
|
$
|
(1.4)
|
|
|
$
|
11.6
|
|
Earnings (loss) per
common share attributable to
Koppers
common shareholders:
|
|
|
|
|
|
|
|
|
Basic -
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
0.09
|
|
|
$
|
0.47
|
|
Discontinued
operations
|
|
|
(0.16)
|
|
|
|
0.09
|
|
(Loss) earnings per
basic common share
|
|
$
|
(0.07)
|
|
|
$
|
0.56
|
|
Diluted -
|
|
|
|
|
|
|
|
|
Continuing
operations
|
|
$
|
0.09
|
|
|
$
|
0.47
|
|
Discontinued
operations
|
|
|
(0.16)
|
|
|
|
0.09
|
|
(Loss) earnings per
diluted common share
|
|
$
|
(0.07)
|
|
|
$
|
0.56
|
|
Comprehensive (loss)
income
|
|
$
|
(51.0)
|
|
|
$
|
20.7
|
|
Comprehensive (loss)
income attributable to noncontrolling interests
|
|
|
(1.3)
|
|
|
|
1.1
|
|
Comprehensive (loss)
income attributable to Koppers
|
|
$
|
(49.7)
|
|
|
$
|
19.6
|
|
Weighted average
shares outstanding (in thousands):
|
|
|
|
|
|
|
|
|
Basic
|
|
|
20,852
|
|
|
|
20,575
|
|
Diluted
|
|
|
21,315
|
|
|
|
20,881
|
|
Koppers Holdings
Inc.
Unaudited
Condensed Consolidated Balance Sheet
(Dollars in
millions, except per share amounts)
|
|
|
|
March 31,
2020
|
|
|
December 31,
2019
|
|
Assets
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
54.2
|
|
|
$
|
32.3
|
|
Accounts receivable,
net of allowance of $2.4 and $2.6
|
|
|
176.8
|
|
|
|
161.7
|
|
Income tax
receivable
|
|
|
4.2
|
|
|
|
1.1
|
|
Inventories,
net
|
|
|
276.2
|
|
|
|
288.5
|
|
Assets of
discontinued operations held for sale
|
|
|
67.5
|
|
|
|
17.1
|
|
Other current
assets
|
|
|
26.0
|
|
|
|
18.8
|
|
Total current
assets
|
|
|
604.9
|
|
|
|
519.5
|
|
Property, plant and
equipment, net
|
|
|
355.4
|
|
|
|
358.8
|
|
Operating lease
right-of-use assets
|
|
|
106.1
|
|
|
|
112.3
|
|
Goodwill
|
|
|
292.7
|
|
|
|
296.1
|
|
Intangible assets,
net
|
|
|
161.7
|
|
|
|
168.4
|
|
Deferred tax
assets
|
|
|
31.0
|
|
|
|
23.7
|
|
Non-current assets of
discontinued operations held for sale
|
|
|
0.0
|
|
|
|
59.3
|
|
Other
assets
|
|
|
21.3
|
|
|
|
26.5
|
|
Total
assets
|
|
$
|
1,573.1
|
|
|
$
|
1,564.6
|
|
Liabilities
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
155.6
|
|
|
$
|
162.8
|
|
Accrued
liabilities
|
|
|
100.9
|
|
|
|
89.3
|
|
Current operating
lease liabilities
|
|
|
21.5
|
|
|
|
22.0
|
|
Current maturities of
long-term debt
|
|
|
10.2
|
|
|
|
10.2
|
|
Liabilities of
discontinued operations held for sale
|
|
|
34.6
|
|
|
|
11.9
|
|
Total current
liabilities
|
|
|
322.8
|
|
|
|
296.2
|
|
Long-term
debt
|
|
|
943.0
|
|
|
|
891.0
|
|
Accrued
postretirement benefits
|
|
|
46.5
|
|
|
|
46.6
|
|
Deferred tax
liabilities
|
|
|
6.4
|
|
|
|
6.8
|
|
Operating lease
liabilities
|
|
|
86.4
|
|
|
|
91.5
|
|
Non-current
liabilities of discontinued operations held for sale
|
|
|
0.0
|
|
|
|
25.1
|
|
Other long-term
liabilities
|
|
|
58.8
|
|
|
|
48.7
|
|
Total
liabilities
|
|
|
1,463.9
|
|
|
|
1,405.9
|
|
Commitments and
contingent liabilities
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
Senior Convertible
Preferred Stock, $0.01 par value per share; 10,000,000
shares
authorized; no shares issued
|
|
|
0.0
|
|
|
|
0.0
|
|
Common Stock, $0.01
par value per share; 80,000,000 shares authorized;
23,556,317 and 23,321,087 shares issued
|
|
|
0.2
|
|
|
|
0.2
|
|
Additional paid-in
capital
|
|
|
224.7
|
|
|
|
221.9
|
|
Retained
earnings
|
|
|
92.4
|
|
|
|
93.8
|
|
Accumulated other
comprehensive loss
|
|
|
(126.1)
|
|
|
|
(77.7)
|
|
Treasury stock, at
cost, 2,574,631 and 2,515,925 shares
|
|
|
(92.1)
|
|
|
|
(90.9)
|
|
Total Koppers
shareholders' equity
|
|
|
99.1
|
|
|
|
147.3
|
|
Noncontrolling
interests
|
|
|
10.1
|
|
|
|
11.4
|
|
Total
equity
|
|
|
109.2
|
|
|
|
158.7
|
|
Total liabilities and
equity
|
|
$
|
1,573.1
|
|
|
$
|
1,564.6
|
|
Koppers Holdings
Inc.
Unaudited
Condensed Consolidated Statement of Cash Flows
(Dollars in
millions)
|
|
|
|
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
Cash (used in)
provided by operating activities:
|
|
|
|
|
|
|
|
|
Net (loss)
income
|
|
$
|
(2.5)
|
|
|
$
|
12.5
|
|
Adjustments to
reconcile net cash (used in) provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
14.5
|
|
|
|
14.6
|
|
Change in derivative
liability
|
|
|
8.4
|
|
|
|
(3.1)
|
|
Stock-based
compensation
|
|
|
2.5
|
|
|
|
2.9
|
|
Non-cash interest
expense
|
|
|
0.7
|
|
|
|
0.6
|
|
Deferred income
taxes
|
|
|
(1.9)
|
|
|
|
0.4
|
|
Insurance
proceeds
|
|
|
0.0
|
|
|
|
(1.4)
|
|
Change in other
liabilities
|
|
|
(5.0)
|
|
|
|
(3.2)
|
|
Other - net
|
|
|
4.2
|
|
|
|
(0.7)
|
|
Changes in working
capital:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(21.0)
|
|
|
|
1.7
|
|
Inventories
|
|
|
8.6
|
|
|
|
(0.5)
|
|
Accounts
payable
|
|
|
(6.7)
|
|
|
|
(30.1)
|
|
Accrued
liabilities
|
|
|
(11.8)
|
|
|
|
(4.5)
|
|
Other working
capital
|
|
|
(7.2)
|
|
|
|
(3.5)
|
|
Net cash used in
operating activities
|
|
|
(17.2)
|
|
|
|
(14.3)
|
|
Cash (used in)
provided by investing activities:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
|
(10.6)
|
|
|
|
(11.0)
|
|
Insurance proceeds
received
|
|
|
0.0
|
|
|
|
1.4
|
|
Net cash provided by
divestitures and asset sales
|
|
|
0.0
|
|
|
|
0.3
|
|
Net cash used in
investing activities
|
|
|
(10.6)
|
|
|
|
(9.3)
|
|
Cash provided by
(used in) financing activities:
|
|
|
|
|
|
|
|
|
Net increase in credit
facility borrowings
|
|
|
54.1
|
|
|
|
34.0
|
|
Repayments of
long-term debt
|
|
|
(2.6)
|
|
|
|
(12.6)
|
|
Issuances of Common
Stock
|
|
|
0.2
|
|
|
|
0.3
|
|
Repurchases of Common
Stock
|
|
|
(1.2)
|
|
|
|
(0.9)
|
|
Payment of debt
issuance costs
|
|
|
(0.2)
|
|
|
|
0.0
|
|
Net cash provided by
financing activities
|
|
|
50.3
|
|
|
|
20.8
|
|
Effect of exchange
rate changes on cash
|
|
|
(0.9)
|
|
|
|
0.4
|
|
Change in cash and
cash equivalents of discontinued operations held for
sale
|
|
|
0.3
|
|
|
|
(2.2)
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
|
21.9
|
|
|
|
(4.6)
|
|
Cash and cash
equivalents at beginning of period
|
|
|
32.3
|
|
|
|
37.4
|
|
Cash and cash
equivalents at end of period
|
|
$
|
54.2
|
|
|
$
|
32.8
|
|
Cash paid for amounts
included in the measurement of lease liabilities:
|
|
|
|
|
|
|
|
|
Operating cash outflow
from operating leases
|
|
$
|
7.9
|
|
|
$
|
7.6
|
|
Supplemental
disclosure of non-cash investing and financing
activities:
|
|
|
|
|
|
|
|
|
Right-of-use assets
obtained in exchange for new operating lease liabilities
|
|
$
|
0.3
|
|
|
$
|
14.3
|
|
Unaudited Segment
Information
|
The following tables
set forth certain sales and operating data, net of all intersegment
transactions, for the company's businesses for the periods
indicated.
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
(Dollars in
millions)
|
|
|
|
Net sales:
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
$
|
190.0
|
|
|
$
|
166.1
|
|
Performance
Chemicals
|
|
|
111.4
|
|
|
|
99.0
|
|
Carbon Materials and
Chemicals
|
|
|
100.5
|
|
|
|
111.8
|
|
Total
|
|
$
|
401.9
|
|
|
$
|
376.9
|
|
Operating profit
(loss):
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
$
|
9.2
|
|
|
$
|
8.7
|
|
Performance
Chemicals
|
|
|
4.1
|
|
|
|
12.8
|
|
Carbon Materials and
Chemicals
|
|
|
0.7
|
|
|
|
3.3
|
|
Corporate
Unallocated
|
|
|
(0.4)
|
|
|
|
(0.5)
|
|
Total
|
|
$
|
13.6
|
|
|
$
|
24.3
|
|
Operating profit
(loss) margin:
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
|
4.8
|
%
|
|
|
5.2
|
%
|
Performance
Chemicals
|
|
|
3.7
|
%
|
|
|
12.9
|
%
|
Carbon Materials and
Chemicals
|
|
|
0.7
|
%
|
|
|
3.0
|
%
|
Total
|
|
|
3.4
|
%
|
|
|
6.4
|
%
|
Depreciation and
amortization:
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
$
|
4.9
|
|
|
$
|
4.8
|
|
Performance
Chemicals
|
|
|
4.5
|
|
|
|
4.9
|
|
Carbon Materials and
Chemicals
|
|
|
4.1
|
|
|
|
3.9
|
|
Total
|
|
$
|
13.5
|
|
|
$
|
13.6
|
|
Adjusted
EBITDA(1):
|
|
|
|
|
|
|
|
|
Railroad and Utility
Products and Services
|
|
$
|
13.4
|
|
|
$
|
14.3
|
|
Performance
Chemicals
|
|
|
17.0
|
|
|
|
15.5
|
|
Carbon Materials and
Chemicals
|
|
|
7.0
|
|
|
|
11.5
|
|
Corporate
Unallocated
|
|
|
0.2
|
|
|
|
(0.5)
|
|
Total
|
|
$
|
37.6
|
|
|
$
|
40.8
|
|
Adjusted EBITDA
margin(2):
|
|
|
|
|
|
|
|
|
Railroad and
Utility Products and Services
|
|
|
7.1
|
%
|
|
|
8.6
|
%
|
Performance
Chemicals
|
|
|
15.3
|
%
|
|
|
15.7
|
%
|
Carbon Materials and
Chemicals
|
|
|
7.0
|
%
|
|
|
10.3
|
%
|
Total
|
|
|
9.4
|
%
|
|
|
10.8
|
%
|
|
(1) The tables below
describe the adjustments to EBITDA for the quarters ended March 31,
2020 and 2019, respectively.
|
(2) Adjusted EBITDA as
a percentage of GAAP sales.
|
UNAUDITED
RECONCILIATION OF OPERATING PROFIT TO EBITDA AND ADJUSTED
EBITDA*
(In
millions)
|
|
|
|
Three Months Ended
March 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
|
|
RUPS
|
|
|
PC
|
|
|
CMC
|
|
|
Unallocated
|
|
|
Consolidated
|
|
Operating profit
(loss)
|
|
$
|
9.2
|
|
|
$
|
4.1
|
|
|
$
|
0.7
|
|
|
$
|
(0.4)
|
|
|
$
|
13.6
|
|
Other income
(loss)
|
|
|
(0.3)
|
|
|
|
0.5
|
|
|
|
(0.4)
|
|
|
|
0.6
|
|
|
|
0.4
|
|
Depreciation and
amortization
|
|
|
4.9
|
|
|
|
4.5
|
|
|
|
4.1
|
|
|
|
0.0
|
|
|
|
13.5
|
|
EBITDA with
noncontrolling interest
|
|
$
|
13.8
|
|
|
$
|
9.1
|
|
|
$
|
4.4
|
|
|
$
|
0.2
|
|
|
$
|
27.5
|
|
Unusual items
impacting EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CMC
restructuring
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
2.7
|
|
|
|
0.0
|
|
|
|
2.7
|
|
Non-cash LIFO
benefit
|
|
|
(0.4)
|
|
|
|
0.0
|
|
|
|
(0.1)
|
|
|
|
0.0
|
|
|
|
(0.5)
|
|
Mark-to-market
commodity hedging
|
|
|
0.0
|
|
|
|
7.9
|
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
7.9
|
|
Adjusted
EBITDA
|
|
$
|
13.4
|
|
|
$
|
17.0
|
|
|
$
|
7.0
|
|
|
$
|
0.2
|
|
|
$
|
37.6
|
|
Adj. EBITDA % of
Consolidated Adj. EBITDA (excluding corporate
unallocated)
|
|
|
35.8
|
%
|
|
|
45.5
|
%
|
|
|
18.7
|
%
|
|
|
|
|
|
|
|
|
UNAUDITED
RECONCILIATION OF OPERATING PROFIT TO EBITDA AND ADJUSTED
EBITDA*
(In
millions)
|
|
|
|
Three Months Ended
March 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
|
|
RUPS
|
|
|
PC
|
|
|
CMC
|
|
|
Unallocated
|
|
|
Consolidated
|
|
Operating profit
(loss)
|
|
$
|
8.7
|
|
|
$
|
12.8
|
|
|
$
|
3.3
|
|
|
$
|
(0.5)
|
|
|
$
|
24.3
|
|
Other income
(loss)
|
|
|
(0.2)
|
|
|
|
0.9
|
|
|
|
(0.1)
|
|
|
|
0.0
|
|
|
|
0.6
|
|
Depreciation and
amortization
|
|
|
4.8
|
|
|
|
4.9
|
|
|
|
3.9
|
|
|
|
0.0
|
|
|
|
13.6
|
|
Depreciation in
impairment and restructuring charges
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
0.2
|
|
|
|
0.0
|
|
|
|
0.2
|
|
EBITDA with
noncontrolling interest
|
|
$
|
13.3
|
|
|
$
|
18.6
|
|
|
$
|
7.3
|
|
|
$
|
(0.5)
|
|
|
$
|
38.7
|
|
Unusual items
impacting EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CMC
restructuring
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
4.2
|
|
|
|
0.0
|
|
|
|
4.2
|
|
Non-cash LIFO
expense
|
|
|
1.0
|
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
1.0
|
|
Mark-to-market
commodity hedging
|
|
|
0.0
|
|
|
|
(3.1)
|
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
(3.1)
|
|
Adjusted
EBITDA
|
|
$
|
14.3
|
|
|
$
|
15.5
|
|
|
$
|
11.5
|
|
|
$
|
(0.5)
|
|
|
$
|
40.8
|
|
Adj. EBITDA % of
Consolidated Adj. EBITDA (excluding
corporate unallocated)
|
|
|
34.6
|
%
|
|
|
37.5
|
%
|
|
|
27.8
|
%
|
|
|
|
|
|
|
|
|
|
*A reconciliation of
segment net income to adjusted segment EBITDA is not available
without unreasonable efforts as we do not measure net income at the
segment level or use it as a measure of operating
performance.
|
UNAUDITED
RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED
EBITDA
(In
millions)
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
Net (loss)
income
|
|
$
|
(2.5)
|
|
|
$
|
12.5
|
|
Interest
expense
|
|
|
14.0
|
|
|
|
16.2
|
|
Depreciation and
amortization
|
|
|
13.5
|
|
|
|
13.6
|
|
Depreciation in
impairment and restructuring charges
|
|
|
0.0
|
|
|
|
0.2
|
|
Income
taxes
|
|
|
(1.8)
|
|
|
|
(1.2)
|
|
Loss (income) from
discontinued operations
|
|
|
4.4
|
|
|
|
(2.7)
|
|
EBITDA with
noncontrolling interests
|
|
|
27.6
|
|
|
|
38.5
|
|
Unusual items
impacting net income
|
|
|
|
|
|
|
|
|
Impairment,
restructuring and plant closure costs
|
|
|
2.7
|
|
|
|
4.3
|
|
Non-cash LIFO
(benefit) expense
|
|
|
(0.6)
|
|
|
|
1.1
|
|
Mark-to-market
commodity hedging
|
|
|
7.9
|
|
|
|
(3.1)
|
|
Total
adjustments
|
|
|
10.0
|
|
|
|
2.3
|
|
Adjusted
EBITDA
|
|
$
|
37.6
|
|
|
$
|
40.8
|
|
UNAUDITED
RECONCILIATION OF NET INCOME ATTRIBUTABLE TO KOPPERS AND ADJUSTED
NET INCOME
(In
millions)
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
Net (loss) income
attributable to Koppers
|
|
$
|
(1.4)
|
|
|
$
|
11.6
|
|
Unusual items
impacting net income
|
|
|
|
|
|
|
|
|
Impairment,
restructuring and plant closure costs
|
|
|
3.3
|
|
|
|
5.9
|
|
Non-cash LIFO
(benefit) expense
|
|
|
(0.6)
|
|
|
|
1.1
|
|
Mark-to-market
commodity hedging
|
|
|
7.9
|
|
|
|
(3.1)
|
|
Total
adjustments
|
|
|
10.6
|
|
|
|
3.9
|
|
Adjustments to income
tax and noncontrolling interests
|
|
|
|
|
|
|
|
|
Income tax on
adjustments to pre-tax income
|
|
|
(2.6)
|
|
|
|
(2.3)
|
|
Noncontrolling
interests
|
|
|
(1.1)
|
|
|
|
0.9
|
|
Effect on adjusted net
income
|
|
|
6.9
|
|
|
|
2.5
|
|
Adjusted net income
including discontinued operations
|
|
|
5.5
|
|
|
|
14.1
|
|
Loss (income) from
discontinued operations
|
|
|
4.4
|
|
|
|
(2.7)
|
|
Adjusted net income
attributable to Koppers
|
|
$
|
9.9
|
|
|
$
|
11.4
|
|
UNAUDITED
RECONCILIATION OF DILUTED EARNINGS PER SHARE AND
ADJUSTED EARNINGS
PER SHARE
(In millions
except share amounts)
|
|
|
|
Three Months Ended
March 31,
|
|
|
|
2020
|
|
|
2019
|
|
Net (loss) income
attributable to Koppers
|
|
$
|
(1.4)
|
|
|
$
|
11.6
|
|
Adjusted net income
attributable to Koppers
|
|
$
|
9.9
|
|
|
$
|
11.4
|
|
Denominator for
diluted earnings per share (in thousands)
|
|
|
21,315
|
|
|
|
20,881
|
|
Earnings per
share:
|
|
|
|
|
|
|
|
|
Diluted (loss)
earnings per share
|
|
$
|
(0.07)
|
|
|
$
|
0.56
|
|
Adjusted earnings per
share
|
|
$
|
0.47
|
|
|
$
|
0.55
|
|
UNAUDITED
RECONCILIATION OF TOTAL DEBT TO NET DEBT AND NET LEVERAGE
RATIO
(In
millions)
|
|
|
|
Twelve months
ended
|
|
|
|
March
31,
2020
|
|
|
December
31,
2019
|
|
|
September
30,
2019
|
|
|
June
30,
2019
|
|
|
March
30,
2019
|
|
Total Debt
|
|
$
|
953.2
|
|
|
$
|
901.2
|
|
|
$
|
959.1
|
|
|
$
|
1,001.0
|
|
|
$
|
1,002.7
|
|
Less: Cash
|
|
|
54.2
|
|
|
|
32.3
|
|
|
|
30.8
|
|
|
|
38.1
|
|
|
|
32.7
|
|
Net Debt
|
|
$
|
899.0
|
|
|
$
|
868.9
|
|
|
$
|
928.3
|
|
|
$
|
962.9
|
|
|
$
|
970.0
|
|
Adjusted
EBITDA
|
|
$
|
197.9
|
|
|
$
|
201.1
|
|
|
$
|
206.6
|
|
|
$
|
203.4
|
|
|
$
|
191.5
|
|
Net Leverage
Ratio
|
|
|
4.5
|
|
|
|
4.3
|
|
|
|
4.5
|
|
|
|
4.7
|
|
|
|
5.1
|
|
UNAUDITED
RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED
EBITDA
ON A LATEST TWELVE
MONTH BASIS
(In
millions)
|
|
|
|
Twelve months
ended
|
|
|
|
March
31,
2020
|
|
|
December 31,
2019
|
|
|
September
30,
2019
|
|
|
June
30,
2019
|
|
|
March
31,
2019
|
|
Net income
|
|
$
|
52.4
|
|
|
$
|
67.4
|
|
|
$
|
44.8
|
|
|
$
|
31.4
|
|
|
$
|
18.0
|
|
Interest
expense
|
|
|
59.8
|
|
|
|
61.9
|
|
|
|
63.4
|
|
|
|
62.2
|
|
|
|
60.2
|
|
Depreciation and
amortization
|
|
|
54.3
|
|
|
|
54.6
|
|
|
|
53.5
|
|
|
|
52.0
|
|
|
|
52.6
|
|
Income tax
provision
|
|
|
(0.6)
|
|
|
|
0.0
|
|
|
|
11.9
|
|
|
|
17.7
|
|
|
|
15.5
|
|
Discontinued
operations, net of tax
|
|
|
3.4
|
|
|
|
(3.7)
|
|
|
|
(5.7)
|
|
|
|
(1.4)
|
|
|
|
(3.4)
|
|
EBITDA
|
|
|
169.3
|
|
|
|
180.2
|
|
|
|
167.9
|
|
|
|
161.9
|
|
|
|
142.9
|
|
Unusual items
impacting net income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment,
restructuring and plant
closure
|
|
|
18.8
|
|
|
|
20.4
|
|
|
|
26.1
|
|
|
|
27.2
|
|
|
|
23.5
|
|
Non-cash LIFO
expense
|
|
|
2.8
|
|
|
|
4.5
|
|
|
|
11.2
|
|
|
|
11.6
|
|
|
|
12.0
|
|
Mark-to-market
commodity hedging
|
|
|
7.0
|
|
|
|
(4.0)
|
|
|
|
1.3
|
|
|
|
1.1
|
|
|
|
0.3
|
|
Acquisition and exit
activity related
costs
|
|
|
0.0
|
|
|
|
0.0
|
|
|
|
0.1
|
|
|
|
1.6
|
|
|
|
12.8
|
|
Adjusted EBITDA with
noncontrolling
interests
|
|
$
|
197.9
|
|
|
$
|
201.1
|
|
|
$
|
206.6
|
|
|
$
|
203.4
|
|
|
$
|
191.5
|
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/koppers-holdings-inc-reports-first-quarter-2020-results-301054854.html
SOURCE Koppers