CANTON, Ohio, July 31, 2017 /PRNewswire/ -- TimkenSteel
(NYSE: TMST) (timkensteel.com), a leader in customized alloy steel
products and services, today reported second-quarter net sales of
$339.3 million and net income of
$1.3 million or $0.03 per diluted share. This compares with
net sales of $223.1 million and a net
loss of $6.6 million or minus
$0.15 per share in the same quarter
last year, and net sales of $309.4
million and a net loss of $5.3
million or minus $0.12 per
share in the first quarter of 2017.
EBITDA(1) for the second quarter was $24.7 million, compared with EBITDA(1)
of $10.2 million in the same
quarter last year and $17.5 million
in the first quarter of 2017. The improvement over the prior
year was driven primarily by additional volume and the favorable
timing impact from raw material spread, as well as a $4.9 million supplier refund related to prior
periods. Sequentially, EBITDA(1) , excluding the
one-time refund, increased $2.3
million as a result of increased volumes.
"We're continuing a steady pace of performance improvement,
driven by growing market demand and the actions we've taken over
the past two years to improve both our operating efficiency and our
competitive position," said Tim
Timken, chairman, CEO and president. "We've had improvement
in our markets, structural improvement in our business performance
and a successful production ramp, which positions us well for the
future."
SECOND-QUARTER 2017 FINANCIAL SUMMARY
Second-quarter net sales increased $116.2 million or 52.1 percent year over year and
increased $29.9 million or 9.7
percent sequentially.
- Ship tons were approximately 295,000, an increase of 55.3
percent over the second quarter of 2016 and 5.3 percent
sequentially.
- Gains were related primarily to increased market penetration,
including winning new business supplying billets to tube makers,
and increased sales into industrial and energy end-markets.
- Surcharge revenue of $77.6
million increased 234.5 percent from the prior-year quarter
and 33.1 percent from the first quarter of 2017 as a result of a
rise in the No. 1 Busheling Index and higher
volumes.
EBIT(1) was $5.8 million, compared with an EBIT(1)
loss of $8.3 million for
the same period a year ago and an EBIT(1) loss of
$1.4 million for the first
quarter of 2017.
- EBIT(1) improved over the prior year due to
additional volume from positive industrial and energy end-market
sentiment and from new billet business, favorable timing impact
related to raw material spread, and a $4.9
million supplier refund, partially offset by negative mix
and price.
- Sequentially, EBIT(1) improved primarily as a result
of increased volumes and the associated manufacturing leverage, as
well as the $4.9 million supplier
refund.
- Melt utilization was 76 percent for the quarter, compared with
45 percent in the second quarter of 2016 and 71 percent in the
first quarter of 2017. Higher volumes, primarily from new
business and increased end-market demand, improved both melt
utilization and operating cost leverage.
THIRD-QUARTER OUTLOOK
- Shipments are expected to be between 2 percent and 5 percent
higher than second-quarter 2017, primarily from industrial products
and billets to tube makers.
- EBITDA(1) is projected to be between $10 million and $20 million, excluding pension
settlement expenses.
-
- At this time, the company is unable to reconcile its EBITDA
outlook to a comparable GAAP range due to an expected non-cash
pension settlement expense. Because this expense is dependent on a
full re-measurement of our salaried pension plan assets and
obligations as of September 30, 2017,
the amount of the expense cannot currently be estimated.
- Expenses associated with labor agreement negotiations
anticipated.
- Raw material spread is expected to be similar to second-quarter
2017; minimal sequential impact.
Other Guidance
- 2017 capital spending is projected to be $40 million.
- Startup of the advanced quench-and-temper facility expected in
the fourth quarter.
The company will host a conference call at 9 a.m. EDT on Tuesday,
Aug. 1, to discuss its financial performance with investors
and securities analysts. The financial results and supplemental
earnings information will be available online at
investors.timkensteel.com.
|
TimkenSteel
Earnings Call Information:
|
|
Conference
Call
|
Tuesday, August 1,
2017
9 a.m. EDT
Toll-free dial-in:
877-201-0168
International
dial-in: 647-788-4901
Conference ID: 49209169
|
|
Conference Call
Replay
|
Replay dial-in
available through August 8, 2017
800-585-8367 or
416-621-4642
Replay passcode:
49209169
|
About TimkenSteel Corporation
TimkenSteel (NYSE:TMST,
timkensteel.com) creates tailored steel products and services for
demanding applications, helping customers push the bounds of what's
possible within their industries. The company reaches around the
world in its customers' products and leads North America in large alloy steel bars (up to
16 inches in diameter) and seamless mechanical tubing made of its
special bar quality (SBQ) steel, as well as supply chain and steel
services. TimkenSteel operates warehouses and sales offices in five
countries and has made all of its steel in America for 100
years. The company posted sales of $870 million in 2016. Follow us on Twitter
@TimkenSteel and on Instagram.
NON-GAAP FINANCIAL MEASURES
TimkenSteel reports its
financial results in accordance with accounting principles
generally accepted in the United
States ("GAAP") and corresponding metrics as non-GAAP
financial measures. This earnings release includes references
to the following non-GAAP financial measures: EBIT, EBITDA
and EBITDA excluding pension settlement expenses. These are
important financial measures used in the management of the
business, including decisions concerning the allocation of
resources and assessment of performance. Management believes
that reporting these non-GAAP financial measures is useful to
investors as these measures are representative of the Company's
performance and provide improved comparability of
results. See the attached schedules for definitions of
the non-GAAP financial measures referred to above and corresponding
reconciliations of these non-GAAP financial measures to the most
comparable GAAP financial measures, as well as supplemental
financial data. At this time, the company is unable to
reconcile its third quarter outlook for EBITDA excluding pension
settlement expenses to a comparable GAAP range due to an expected
non-cash pension settlement expense. Because this expense is
dependent on a full re-measurement of our salaried pension plan
assets and obligations as of September 30,
2017, the amount of the expense cannot currently be
estimated. Non-GAAP financial measures should be viewed as
additions to, and not as alternatives for, TimkenSteel's results
prepared in accordance with GAAP. In addition, the non-GAAP
measures TimkenSteel uses may differ from non-GAAP measures used by
other companies, and other companies may not define the non-GAAP
measures TimkenSteel uses in the same way.
This news release includes "forward-looking" statements
within the meaning of the federal securities laws. You can
generally identify the company's forward-looking statements by
words such as "anticipate," "believe," "could," "estimate,"
"expect," "forecast," "outlook," "intend," "may," "plan,"
"possible," "potential," "predict," "project," "seek," "target,"
"should" or "would" or other similar words, phrases or expressions
that convey the uncertainty of future events or outcomes. The
company cautions readers that actual results may differ materially
from those expressed or implied in forward-looking statements made
by or on behalf of the company due to a variety of factors, such
as: the impact of mark-to-market accounting; the company's ability
to realize the expected benefits of its spinoff from The Timken
Company; deterioration in world economic conditions, or in economic
conditions in any of the geographic regions in which the company
conducts business, including additional adverse effects from global
economic slowdown, terrorism or hostilities, including political
risks associated with the potential instability of governments and
legal systems in countries in which the company or its customers
conduct business, and changes in currency valuations; the effects
of fluctuations in customer demand on sales, product mix and prices
in the industries in which the company operates, including the
ability of the company to respond to rapid changes in customer
demand, the effects of customer bankruptcies or liquidations, the
impact of changes in industrial business cycles, and whether
conditions of fair trade exist in U.S. markets; competitive
factors, including changes in market penetration, increasing price
competition by existing or new foreign and domestic competitors,
the introduction of new products by existing and new competitors,
and new technology that may impact the way the company's products
are sold or distributed; changes in operating costs, including the
effect of changes in the company's manufacturing processes, changes
in costs associated with varying levels of operations and
manufacturing capacity, availability of raw materials and energy,
the company's ability to mitigate the impact of fluctuations in raw
materials and energy costs and the effectiveness of its surcharge
mechanism, changes in the expected costs associated with product
warranty claims, changes resulting from inventory management, cost
reduction initiatives and different levels of customer demands, the
effects of unplanned work stoppages, and changes in the cost of
labor and benefits; the success of the company's operating plans,
announced programs, initiatives and capital investments (including
the jumbo bloom vertical caster and advanced quench-and-temper
facility); the ability to integrate acquired companies, the ability
of acquired companies to achieve satisfactory operating results,
including results being accretive to earnings; the company's
ability to maintain appropriate relations with unions that
represent its employees in certain locations in order to avoid
disruptions of business; and the availability of financing and
interest rates, which affect the company's cost of funds and/or
ability to raise capital, the company's pension obligations and
investment performance, and/or customer demand and the ability of
customers to obtain financing to purchase the company's products or
equipment that contain its products.
Additional risks relating to the company's business, the
industries in which the company operates or the company's common
shares may be described from time to time in the company's filings
with the SEC. All of these risk factors are difficult to predict,
are subject to material uncertainties that may affect actual
results and may be beyond the company's control. Readers are
cautioned that it is not possible to predict or identify all of the
risks, uncertainties and other factors that may affect future
results and that the above list should not be considered to be a
complete list. Except as required by the federal securities laws,
the company undertakes no obligation to publicly update or revise
any forward-looking statement, whether as a result of new
information, future events or otherwise.
(1) Please see discussion of
non-GAAP financial measures in this news release.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
|
|
|
|
|
Six Months
Ended
June 30,
|
|
Three Months
Ended
June 30,
|
|
Three Months
Ended
March 31,
|
|
(Dollars in
millions, except per share data) (Unaudited)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net sales
|
$648.7
|
|
|
$441.0
|
|
|
$339.3
|
|
|
$223.1
|
|
|
$309.4
|
|
|
$217.9
|
|
|
Cost of products
sold
|
607.9
|
|
|
423.3
|
|
|
315.5
|
|
|
210.8
|
|
|
292.4
|
|
|
212.5
|
|
|
Gross
Profit
|
40.8
|
|
|
17.7
|
|
|
23.8
|
|
|
12.3
|
|
|
17.0
|
|
|
5.4
|
|
|
Selling, general
& administrative expenses (SG&A)
|
45.2
|
|
|
45.0
|
|
|
22.3
|
|
|
22.9
|
|
|
22.9
|
|
|
22.1
|
|
|
Restructuring
charges
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
—
|
|
|
Other (income)
expense, net
|
(8.8)
|
|
|
(5.2)
|
|
|
(4.3)
|
|
|
(2.6)
|
|
|
(4.5)
|
|
|
(2.6)
|
|
|
Earnings (Loss)
Before Interest and Taxes (EBIT) (1)
|
4.4
|
|
|
(22.4)
|
|
|
5.8
|
|
|
(8.3)
|
|
|
(1.4)
|
|
|
(14.1)
|
|
|
Interest
expense
|
7.3
|
|
|
4.1
|
|
|
3.7
|
|
|
2.1
|
|
|
3.6
|
|
|
2.0
|
|
|
Income (Loss)
Before Income Taxes
|
(2.9)
|
|
|
(26.5)
|
|
|
2.1
|
|
|
(10.4)
|
|
|
(5.0)
|
|
|
(16.1)
|
|
|
Provision (benefit)
for income taxes
|
1.1
|
|
|
(10.2)
|
|
|
0.8
|
|
|
(3.8)
|
|
|
0.3
|
|
|
(6.4)
|
|
|
Net Income
(Loss)
|
($4.0)
|
|
|
($16.3)
|
|
|
$1.3
|
|
|
($6.6)
|
|
|
($5.3)
|
|
|
($9.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss)
per Common Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic income (loss)
per share
|
($0.09)
|
|
|
($0.37)
|
|
|
$0.03
|
|
|
($0.15)
|
|
|
($0.12)
|
|
|
($0.22)
|
|
|
Diluted income (loss)
per share (2)
|
($0.09)
|
|
|
($0.37)
|
|
|
$0.03
|
|
|
($0.15)
|
|
|
($0.12)
|
|
|
($0.22)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends per
share
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares outstanding
|
44,346,422
|
|
|
44,212,796
|
|
|
44,399,070
|
|
|
44,220,496
|
|
|
44,300,396
|
|
|
44,206,837
|
|
|
Weighted average
shares outstanding - assuming dilution
|
44,346,422
|
|
|
44,212,796
|
|
|
44,830,314
|
|
|
44,220,496
|
|
|
44,300,396
|
|
|
44,206,837
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) EBIT
is defined as net income (loss) before interest expense and income
taxes. EBIT is an important financial measure used in the
management of the business, including decisions concerning the
allocation of resources and assessment of performance. Management
believes that reporting EBIT is useful to investors as this measure
is representative of the Company's performance.
|
|
(2) Common
share equivalents for shares issuable for equity-based awards were
excluded from the computation of diluted earnings (loss) per share
for the six months ended June 30, 2017 and the three and six months
ended June 30, 2016 because the effect of their inclusion would
have been anti-dilutive. Common share equivalents for shares
issuable upon the conversion of outstanding convertible notes were
excluded from the computation of diluted earnings (loss) per share
for the three and six months ended June 30, 2017 and 2016 because
the effect of their inclusion would have been
anti-dilutive.
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
|
(Dollars in
millions) (Unaudited)
|
June 30,
2017
|
|
March 31,
2017
|
|
December 31,
2016
|
|
ASSETS
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$36.2
|
|
|
$20.6
|
|
|
$25.6
|
|
|
Accounts receivable,
net of allowances
|
153.5
|
|
|
147.9
|
|
|
91.6
|
|
|
Inventories,
net
|
199.3
|
|
|
190.9
|
|
|
164.2
|
|
|
Deferred charges and
prepaid expenses
|
1.8
|
|
|
3.1
|
|
|
2.8
|
|
|
Other current
assets
|
6.2
|
|
|
7.6
|
|
|
6.2
|
|
|
Total Current
Assets
|
397.0
|
|
|
370.1
|
|
|
290.4
|
|
|
Property, Plant and
Equipment, net
|
713.7
|
|
|
727.3
|
|
|
741.9
|
|
|
Other
Assets
|
|
|
|
|
|
|
Pension
assets
|
9.3
|
|
|
8.4
|
|
|
6.2
|
|
|
Intangible assets,
net
|
22.2
|
|
|
23.6
|
|
|
25.0
|
|
|
Other non-current
assets
|
6.2
|
|
|
6.1
|
|
|
6.4
|
|
|
Total Other
Assets
|
37.7
|
|
|
38.1
|
|
|
37.6
|
|
|
Total
Assets
|
$1,148.4
|
|
|
$1,135.5
|
|
|
$1,069.9
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
|
|
|
|
|
Accounts payable,
trade
|
$130.8
|
|
|
$126.4
|
|
|
$87.0
|
|
|
Salaries, wages and
benefits
|
25.1
|
|
|
26.4
|
|
|
20.3
|
|
|
Accrued pension and
postretirement costs
|
3.0
|
|
|
3.0
|
|
|
3.0
|
|
|
Other current
liabilities
|
17.9
|
|
|
17.9
|
|
|
20.4
|
|
|
Total Current
Liabilities
|
176.8
|
|
|
173.7
|
|
|
130.7
|
|
|
Convertible notes,
net
|
68.2
|
|
|
67.3
|
|
|
66.4
|
|
|
Other long-term
debt
|
100.2
|
|
|
95.2
|
|
|
70.2
|
|
|
Accrued pension and
postretirement costs
|
193.4
|
|
|
193.2
|
|
|
192.1
|
|
|
Deferred income
taxes
|
0.2
|
|
|
0.3
|
|
|
—
|
|
|
Other non-current
liabilities
|
12.7
|
|
|
12.6
|
|
|
13.1
|
|
|
Total
Non-Current Liabilities
|
374.7
|
|
|
368.6
|
|
|
341.8
|
|
|
SHAREHOLDERS'
EQUITY
|
|
|
|
|
|
|
Additional paid-in
capital
|
841.6
|
|
|
841.4
|
|
|
845.6
|
|
|
Retained
deficit
|
(198.2)
|
|
|
(199.5)
|
|
|
(193.9)
|
|
|
Treasury
shares
|
(38.2)
|
|
|
(39.8)
|
|
|
(44.9)
|
|
|
Accumulated other
comprehensive loss
|
(8.3)
|
|
|
(8.9)
|
|
|
(9.4)
|
|
|
Total
Shareholders' Equity
|
596.9
|
|
|
593.2
|
|
|
597.4
|
|
|
Total Liabilities and
Shareholders' Equity
|
$1,148.4
|
|
|
$1,135.5
|
|
|
$1,069.9
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
(Dollars in
millions) (Unaudited)
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
CASH PROVIDED
(USED)
|
|
|
|
|
|
|
|
|
Operating
Activities
|
|
|
|
|
|
|
|
|
Net Income
(Loss)
|
$1.3
|
|
|
($6.6)
|
|
|
($4.0)
|
|
|
($16.3)
|
|
|
Adjustments to
reconcile net loss to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
18.9
|
|
|
18.5
|
|
|
37.8
|
|
|
37.2
|
|
|
Amortization of
deferred financing fees and debt discount
|
0.9
|
|
|
0.6
|
|
|
2.1
|
|
|
0.8
|
|
|
Impairment charges
and loss on sale or disposal of assets
|
0.4
|
|
|
0.3
|
|
|
0.4
|
|
|
1.1
|
|
|
Deferred income
taxes
|
(0.1)
|
|
|
(6.4)
|
|
|
0.2
|
|
|
(15.1)
|
|
|
Stock-based
compensation expense
|
1.8
|
|
|
1.5
|
|
|
3.4
|
|
|
3.0
|
|
|
Pension and
postretirement expense
|
0.8
|
|
|
1.8
|
|
|
1.6
|
|
|
2.4
|
|
|
Pension and
postretirement contributions and payments
|
(1.1)
|
|
|
(1.4)
|
|
|
(2.7)
|
|
|
(3.3)
|
|
|
Reimbursement from
postretirement plan assets
|
—
|
|
|
—
|
|
|
—
|
|
|
13.3
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts receivable,
net
|
(5.6)
|
|
|
(2.4)
|
|
|
(61.9)
|
|
|
(16.5)
|
|
|
Inventories,
net
|
(8.4)
|
|
|
3.5
|
|
|
(35.1)
|
|
|
16.5
|
|
|
Accounts payable,
trade
|
4.4
|
|
|
16.5
|
|
|
43.8
|
|
|
23.1
|
|
|
Other accrued
expenses
|
(1.4)
|
|
|
(3.2)
|
|
|
1.5
|
|
|
(13.9)
|
|
|
Deferred charges and
prepaid expenses
|
1.3
|
|
|
2.7
|
|
|
1.0
|
|
|
9.7
|
|
|
Other, net
|
1.5
|
|
|
2.5
|
|
|
0.3
|
|
|
6.0
|
|
|
Net Cash (Used)
Provided by Operating Activities
|
14.7
|
|
|
27.9
|
|
|
(11.6)
|
|
|
48.0
|
|
|
Investing
Activities
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
(4.1)
|
|
|
(6.7)
|
|
|
(6.8)
|
|
|
(15.2)
|
|
|
Net Cash Used by
Investing Activities
|
(4.1)
|
|
|
(6.7)
|
|
|
(6.8)
|
|
|
(15.2)
|
|
|
Financing
Activities
|
|
|
|
|
|
|
|
|
Proceeds from
exercise of stock options
|
—
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
Shares surrendered
for employee taxes on stock compensation
|
—
|
|
|
—
|
|
|
(1.2)
|
|
|
—
|
|
|
Credit agreement
repayments
|
—
|
|
|
(105.0)
|
|
|
—
|
|
|
(120.0)
|
|
|
Credit agreement
borrowings
|
5.0
|
|
|
—
|
|
|
30.0
|
|
|
—
|
|
|
Debt issuance
costs
|
—
|
|
|
(2.8)
|
|
|
—
|
|
|
(4.3)
|
|
|
Proceeds from
issuance of convertible notes
|
—
|
|
|
86.3
|
|
|
—
|
|
|
86.3
|
|
|
Net Cash Provided
(Used) by Financing Activities
|
5.0
|
|
|
(21.5)
|
|
|
29.0
|
|
|
(38.0)
|
|
|
Effect of exchange
rate changes on cash
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Increase (decrease)
In Cash and Cash Equivalents
|
15.6
|
|
|
(0.3)
|
|
|
10.6
|
|
|
(5.2)
|
|
|
Cash and cash
equivalents at beginning of period
|
20.6
|
|
|
37.5
|
|
|
25.6
|
|
|
42.4
|
|
|
Cash and Cash
Equivalents at End of Period
|
$36.2
|
|
|
$37.2
|
|
|
$36.2
|
|
|
$37.2
|
|
|
Reconciliation of
Earnings (Loss) Before Interest and Taxes (EBIT) (1)
and Earnings Before Interest, Taxes, Depreciation and
Amortization (EBITDA) (2) to
GAAP Net Loss:
|
|
This reconciliation
is provided as additional relevant information about the Company's
performance. EBIT and EBITDA are important financial measures
used in the
management of the business, including decisions concerning the
allocation of resources and assessment of performance.
Management believes that reporting EBIT and
EBITDA is useful to investors as these measures are representative
of the Company's performance. Management also believes that
it is appropriate to compare GAAP net
income (loss) to EBIT and EBITDA.
|
|
(Dollars in
millions) (Unaudited)
|
Six Months
Ended
June 30,
|
|
Three Months
Ended
June 30,
|
|
Three Months
Ended
March 31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net Income
(Loss)
|
($4.0)
|
|
|
($16.3)
|
|
|
$1.3
|
|
|
($6.6)
|
|
|
($5.3)
|
|
|
($9.7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (Benefit)
for income taxes
|
1.1
|
|
|
(10.2)
|
|
|
0.8
|
|
|
(3.8)
|
|
|
0.3
|
|
|
(6.4)
|
|
|
Interest
expense
|
7.3
|
|
|
4.1
|
|
|
3.7
|
|
|
2.1
|
|
|
3.6
|
|
|
2.0
|
|
|
Earnings (Loss)
Before Interest and Taxes (EBIT) (1)
|
$4.4
|
|
|
($22.4)
|
|
|
$5.8
|
|
|
($8.3)
|
|
|
($1.4)
|
|
|
($14.1)
|
|
|
EBIT Margin
(1)
|
0.7
|
%
|
|
(5.1)
|
%
|
|
1.7
|
%
|
|
(3.7)
|
%
|
|
(0.5)
|
%
|
|
(6.5)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
37.8
|
|
|
37.2
|
|
|
18.9
|
|
|
18.5
|
|
|
18.9
|
|
|
18.7
|
|
|
Earnings Before
Interest, Taxes, Depreciation and Amortization (EBITDA)
(2)
|
$42.2
|
|
|
$14.8
|
|
|
$24.7
|
|
|
$10.2
|
|
|
$17.5
|
|
|
$4.6
|
|
|
EBITDA Margin
(2)
|
6.5
|
%
|
|
3.4
|
%
|
|
7.3
|
%
|
|
4.6
|
%
|
|
5.7
|
%
|
|
2.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) EBIT
is defined as net income (loss) before interest expense and income
taxes. EBIT Margin is EBIT as a percentage of net sales.
|
|
(2) EBITDA
is defined as net income (loss) before interest expense, income
taxes, depreciation and amortization. EBITDA Margin is EBITDA
as a percentage of net sales.
|
|
Reconciliation of
Total Debt to Net Debt and the Ratio of Total Debt and Net Debt to
Capital:
|
|
This reconciliation
is provided as additional relevant information about the Company's
financial position. Capital, used for the ratio of total debt
to capital and net debt to
capital, is defined as total debt plus total equity.
Management believes net debt is useful to investors as it is an
important measure of the Company's financial position due
to the amount of cash and cash equivalents.
|
|
(Dollars in
millions) (Unaudited)
|
June 30,
2017
|
March 31,
2017
|
December 31,
2016
|
|
Convertible notes,
net
|
$68.2
|
|
$67.3
|
|
$66.4
|
|
|
Other long-term
debt
|
100.2
|
|
95.2
|
|
70.2
|
|
|
Total long-term
financing
|
168.4
|
|
162.5
|
|
136.6
|
|
|
Less: Cash and cash
equivalents
|
36.2
|
|
20.6
|
|
25.6
|
|
|
Net
Debt
|
$132.2
|
|
$141.9
|
|
$111.0
|
|
|
|
|
|
|
Total
Equity
|
$596.9
|
|
$593.2
|
|
$597.4
|
|
|
|
|
|
|
Ratio of Total
Debt to Capital
|
22.0
|
%
|
21.5
|
%
|
18.6
|
%
|
|
Ratio of Net Debt
to Capital
|
17.3
|
%
|
18.8
|
%
|
15.1
|
%
|
|
Reconciliation of
Free Cash Flow to GAAP Net Cash (Used) Provided by Operating
Activities:
|
|
|
|
|
|
Management believes
that free cash flow is useful to investors because it is a
meaningful indicator of cash generated from operating
activities
available for the execution of its business strategy.
|
|
|
|
|
|
(Dollars in
millions) (Unaudited)
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net Cash (Used)
Provided by Operating Activities
|
$14.7
|
|
|
$27.9
|
|
|
($11.6)
|
|
|
$48.0
|
|
|
Less: Capital
expenditures
|
(4.1)
|
|
|
(6.7)
|
|
|
(6.8)
|
|
|
(15.2)
|
|
|
Free Cash
Flow
|
$10.6
|
|
|
$21.2
|
|
|
($18.4)
|
|
|
$32.8
|
|
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SOURCE TimkenSteel