Fourth-Quarter Financial Highlights
- Net sales were $177.5 million, a
decrease of 7.4% compared to Q4 2014. Excluding currency effects,
net sales decreased 3.2% (see Table 1).
- Adjusted EBITDA was $38.7 million,
compared to $36.3 million in Q4 2014 (see Tables 6 and 7).
- Q4 2015 income attributable to the
Company was $1.17 per share, compared to $0.25 in Q4 2014.
Excluding adjustments (see Table 15), income attributable to the
Company was $0.46 per share, compared to $0.35 in Q4 2014.
- Full-year net sales were $709.9
million, a decrease of 4.8%. Excluding currency effects, full-year
net sales increased 0.6% compared to 2014 (see Table 8).
- Including a $14.0 million charge in Q2
2015 related to an AEC contract, full-year Adjusted EBITDA was
$141.0 million in 2015, compared to $144.8 million in 2014 (see
Tables 9 and 10).
- Net debt was $80.6 million at the end
of December, a decrease of $18.1 million for Q4 2015 and $12.4
million for the full year (see Table 16).
Albany International Corp. (NYSE:AIN) reported that Q4 2015
income attributable to the Company was $37.6 million, including a
net benefit of $29.8 million for income tax adjustments. Income
attributable to the Company in Q4 2014 was $7.9 million, including
net charges of $0.2 million for income tax adjustments.
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Q4 2015 income before income taxes was $11.3 million, including
restructuring charges of $9.9 million and losses of $0.6 million
from foreign currency revaluation. Q4 2014 income before income
taxes was $12.4 million, including a pension settlement charge of
$8.2 million, restructuring charges of $1.7 million, and gains of
$4.9 million from foreign currency revaluation.
Table 1 summarizes net sales and the effect of changes in
currency translation rates:
Table 1
Impact of Percent Net Sales
Changes Change Three Months ended in Currency excluding December
31, Percent Translation Currency (in thousands)
2015
2014
Change Rates Rate Effect Machine Clothing (MC)
$145,004 $160,238 -9.5 % ($7,364 )
-4.9 % Albany Engineered Composites (AEC) 32,462
31,421 3.3 % (688 ) 5.5 % Total
$177,466 $191,659 -7.4 % ($8,052 ) -3.2
%
Changes in currency translation rates, driven mainly by the
stronger U.S. dollar, resulted in a $7.4 million decline in MC
sales. Excluding the currency effect, MC sales were down compared
to Q4 2014 due to a weak Brazilian economy, and in North America
the combination of decline in the printing and writing market
discussed in Q2 and stronger-than-normal year-end slowdowns in the
packaging grades. Q4 2015 AEC sales included revenue of $5.1
million for customer reimbursement of development tooling.
Q4 2015 gross profit was $71.7 million, or 40.4% of net sales,
compared to $72.9 million, or 38.0% of net sales, in the same
period of 2014. MC gross profit was $68.8 million, or 47.4% of net
sales, compared to $69.0 million, or 43.0% of net sales, in Q4
2014. The improvement in gross profit margin reflects lower costs
of raw materials, improved productivity, and the effect of
restructuring programs. Even though changes in currency translation
rates had a significant effect on MC net sales, they once again had
only a minor negative effect on gross profit principally due to the
continuing weakness of the Brazilian real and Mexican peso. AEC
gross profit was $3.3 million in Q4 2015, compared to $4.2 million
in Q4 2014.
Selling, technical, general, and research (STG&R) expenses
were $46.9 million, or 26.4% of net sales, in Q4 2015, compared to
$50.3 million, or 26.3% of net sales, in Q4 2014. The decrease in
STG&R compared to 2014 was principally due to changes in
currency translation rates and cost reduction activities. The
revaluation of nonfunctional-currency assets and liabilities
resulted in fourth-quarter gains of $0.5 million in 2015 and $2.4
million in 2014.
The following table presents fourth-quarter expenses associated
with internally funded research and development by segment:
Table 2
Research and development
expenses by segment Three Months ended December 31, (in thousands)
2015 2014 Machine Clothing $5,487
$6,043 Albany Engineered Composites 2,495 2,871
Corporate expenses 194 195 Total $8,176
$9,109
The following table summarizes fourth-quarter operating income
by segment:
Table 3
Operating Income/(loss) Three
Months ended December 31, (in thousands) 2015
2014 Machine Clothing $30,342 $33,120
Albany Engineered Composites (1,843 ) (697 )
Corporate expenses (13,634 ) (11,609 ) Pension
settlement charge - (8,190 ) Total
$14,865 $12,624
Segment operating income was affected by restructuring and
currency revaluation as shown in Table 4 below. Q4 2015
restructuring charges were principally related to an early
retirement program in the United States, and ongoing plant closure
costs in Germany.
Table 4
Expenses/(gain) in Q4 2015 Expenses/(gain) in Q4 2014
resulting from resulting from (in thousands) Restructuring
Revaluation Restructuring Revaluation Machine
Clothing $8,282 ($542 ) $1,701 ($2,115
) Albany Engineered Composites - - -
(249 ) Corporate expenses 1,635 -
- 1 Total $9,917 ($542 )
$1,701 ($2,363 )
Q4 2015 Other income/expense, net, was expense of $1.6 million,
including losses related to the revaluation of
nonfunctional-currency balances of $1.1 million. Q4 2014 Other
income/expense, net, was income of $2.4 million, including gains
related to the revaluation of nonfunctional-currency balances of
$2.6 million.
The following table summarizes currency revaluation effects on
certain financial metrics:
Table 5
Income/(loss) attributable to
currency revaluation Three Months ended December 31, (in thousands)
2015 2014 Operating income $542
$2,363 Other income/(expense), net (1,092 )
2,560 Total ($550 ) $4,923
The Company’s income tax rate, excluding tax adjustments, was
31.8% for Q4 2015, compared to 33.3% for the same period of 2014.
In Q4 2015, the Company recorded net favorable discrete tax
adjustments of $27.3 million, including a benefit of $28.6 million
related to the elimination of the value of the Company’s investment
in its German subsidiary, where manufacturing operations have now
ceased. The Company also recorded a reduction of $2.5 million to Q4
2015 income taxes due to a decrease in the tax rate from Q3 2015.
Discrete tax charges and the effect of a change in the estimated
tax rate increased income tax expense by $0.2 million for Q4
2014.
The following tables summarize Adjusted EBITDA:
Table 6
Three
Months ended December 31, 2015 Albany
Corporate Machine Engineered expenses Total
(in
thousands) Clothing Composites and other
Company Net income $30,342 ($1,843 )
$8,967 $37,466 Interest expense, net
- - 1,935 1,935
Income tax (benefit) - -
(26,185 ) (26,185 ) Depreciation and amortization
9,425 3,295 2,113 14,833
EBITDA 39,767
1,452 (13,170 )
28,049 Restructuring expenses, net 8,282
- 1,635 9,917
Foreign currency revaluation (gains)/losses (542 ) -
1,092 550 Pretax loss
attributable to noncontrolling interest in ASC -
135 - 135
Adjusted
EBITDA $47,507 $1,587
($10,443 ) $38,651
Table 7
Three
Months ended December 31, 2014 Albany
Corporate Machine Engineered expenses Total
(in
thousands) Clothing Composites and other
Company Net income $33,120 ($697 )
($24,318 ) $8,105 Interest expense, net
- - 2,592 2,592
Income tax expense - - 4,316
4,316 Depreciation and amortization
10,996 3,499 2,056 16,551
EBITDA 44,116
2,802 (15,354 )
31,564 Restructuring and other, net 1,701
- - 1,701 Foreign
currency revaluation (gains)/losses (2,115 ) (249 )
(2,559 ) (4,923 ) Pension settlement charge -
- 8,190 8,190
Pretax income attributable to noncontrolling interest in ASC
- (275 ) - (275 )
Adjusted
EBITDA $43,702 $2,278
($9,723 ) $36,257
Capital spending was $10.3 million for Q4 2015, compared to
$12.3 million for Q4 2014. Depreciation and amortization was $14.8
million for Q4 2015, compared to $16.6 million for Q4 2014.
CFO Comments
CFO and Treasurer John Cozzolino commented, “Net debt (total
debt less cash) in Q4 decreased $18 million to $81 million,
bringing the full-year decline in net debt to $12 million (see
Table 16). Both components of net debt, total debt and cash,
improved in Q4 as total debt dropped $5 million to $266 million and
cash increased $13 million to $185 million. The Company’s leverage
ratio, as defined in our primary debt agreements, decreased from
1.30 at the end of 2014 to 1.27 at the end of this year. Capital
expenditures for the year were $51 million. We expect 2016 and 2017
to be peak years for capital spending in support of the LEAP ramp
and as a result are currently estimating total Company spending for
2016 to be $75 million to $85 million. The Company’s income tax
rate, excluding tax adjustments, was 32% in 2015 and is currently
estimated to range from 30% to 35% in 2016. Cash paid for income
taxes during the year was about $18 million and is expected to
total $20 million to $25 million in 2016.
“In Q4 2015, the Company recorded a $29 million tax benefit
related to the elimination of its investment in its German
subsidiary. The Company expects that most of this tax benefit will
be utilized to lower cash taxes related to future
repatriations.”
CEO Comments
President and CEO Joe Morone said, “Q4 was another good quarter
for Albany International. Both businesses continued to perform
well, as once again MC generated strong margins and AEC continued
to grow and progress toward the LEAP ramp. Company-wide cash flow
was strong, with net debt declining $18 million to $81 million.
“In MC, full-year sales excluding currency were essentially
flat, despite soft Q4 sales due to the economic weakness in key
markets. Profitability was outstanding. Adjusted EBITDA for the
quarter and for the full year was 9% ahead of 2014. Roughly half of
this increase was due to the favorable impact of the strong dollar
on currency translation. The rest of the increase was from several
sources: the shutdown of our plant in Germany, restructuring
activities that reduced STG&R expense, lower cost of raw
material due to lower energy prices, and higher labor productivity
across many of our plants. In Q4, MC took an additional step to
reduce STG&R expense by implementing an early retirement
program for its salaried employees in the U.S.
“Q4 2015 was also a good quarter for MC on the technology and
new products front. The new composite technology platform continues
to gain momentum at the high end of the tissue and towel market,
and we are encouraged by initial trials in the packaging market.
Finally, we successfully completed negotiations to renew our
contracts with two of our largest customers, one in the U.S. and
one in Europe. Although competitive pricing pressures persist in
all of our markets around the world, our prices were for the most
part stable in Q4.
“AEC sales excluding currency grew almost 14% for the full year.
The growth was driven by a combination of higher development and
parts sales associated with the LEAP, Joint Strike Fighter (JSF)
LiftFan®, and GE9X fan case programs. Most importantly, AEC
continued to make good progress in preparation for the LEAP ramp,
which begins late this year. In R&D and business development,
good progress also continued on several fronts. In addition to
continuing to support advances in the LEAP program, and to position
ourselves for content on both the engine and airframe for
next-generation single-aisle aircraft, our efforts were focused on
several new platforms that have the potential to generate initial
revenue either later this decade or in the first half of the next
decade. The most significant of these new platforms are Boeing’s
777x aircraft; a new mid-size airplane that Boeing is reported to
be considering; the Department of Defense’s JSF and Long Range
Strike Bomber; and new supercar and premium sports and luxury
vehicles in the high end of the automotive market.
“As for our outlook, our near- and long-term expectations for
both businesses remain unchanged. To reiterate the view we
expressed about MC last quarter, notwithstanding the 9% increase in
Adjusted EBITDA in 2015, we continue to view MC as a business
capable of generating steady year-over-year Adjusted EBITDA and
cash flow, with annual Adjusted EBITDA in the range of $180 million
to $195 million. Despite the likelihood of a slower start this year
than last due to continued strong economic headwinds in key
markets, and barring further deterioration in the macroeconomic
environment, our strong margins and continuing productivity
improvements should make it possible for us to keep well within
that normal Adjusted EBITDA range.
“For AEC, we anticipate annual revenue growth of roughly 5-10%,
with some upside depending on a host of variables related to the
LEAP ramp. EBITDA should also improve, at a steeper rate than
sales. But the real significance of 2016 is that it represents the
final year of preparation for the LEAP ramp, and so our highest
priority will be on continuing efforts to improve yield, accelerate
cost reduction, and prepare our Mexican plant for start-up in 2017.
Assuming Airbus and Boeing do indeed increase production of the
A320neo and 737MAX to roughly 60 aircraft per month by the end of
the decade, AEC will need to manufacture over 40,000 blades and
2,000 fan cases a year by 2020, compared to roughly 2,500 blades
and 100 cases in 2015. At these levels of production, LEAP revenue
should grow from $50 million in 2015 to close to $200 million by
2020. Total AEC revenue, assuming no new programs beyond the ones
already secured (an assumption we hope is conservative), should
grow from $100 million in 2015 to roughly $250 million in 2020. The
steepest ramps in production and therefore in AEC revenue and
income will likely be in 2017 and 2018.
“2016 should also be a pivotal year for AEC’s legacy operations,
which accounted for 40% of AEC’s 2015 revenue and were responsible
for a significant drag on AEC profitability. In January, we
announced internally that we plan to consolidate most of our legacy
programs, which are currently spread over two plants, into our
facility in Boerne, Texas. At the same time, we are finalizing with
Rolls-Royce a long-term supply agreement for production of
composite parts for the JSF LiftFan. The expected growth from this
program as demand begins to ramp in 2017, coupled with the program
consolidation into Boerne, should drive significant improvements in
margins by the second half of 2017.
“So in sum, performance in both businesses was strong in Q4 and
for the full year, and we expect performance to remain strong in
2016. Despite the significant economic headwinds and barring
further deterioration in the macroeconomic environment, we look for
MC to generate Adjusted EBITDA well within its normal range. And
for AEC, we expect roughly 5-10% revenue growth coupled with
improving profitability in this the final year of the lead-up to
the LEAP ramp.”
The Company plans a webcast to discuss fourth-quarter 2015
financial results on Tuesday, February 9, at 9:00 a.m. Eastern
Time. For access, go to www.albint.com.
About Albany International Corp.
Albany International is a global advanced textiles and materials
processing company, with two core businesses. Machine Clothing 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 19 plants in 10 countries, employs 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.
This release contains certain items, such as earnings before
interest, taxes, depreciation and amortization (EBITDA), Adjusted
EBITDA, sales excluding currency effects, income tax rate excluding
adjustments, net debt, net income attributable to the Company,
excluding adjustments (on an absolute and per-share basis), and
certain income and expense items on a per-share basis that could be
considered non-GAAP financial measures. Such items are provided
because management believes that, when presented together with the
GAAP items to which they relate, they provide additional useful
information to investors regarding the Company’s operational
performance. Presenting increases or decreases in sales, after
currency effects are excluded, can give management and investors
insight into underlying sales trends. An understanding of the
impact in a particular quarter of specific restructuring costs, or
other gains and losses, on operating income or EBITDA can give
management and investors additional insight into quarterly
performance, especially when compared to quarters in which such
items had a greater or lesser effect, or no effect. All non-GAAP
financial measures in this release relate to the Company’s
continuing operations.
The effect of changes in currency translation rates is
calculated by converting amounts reported in local currencies into
U.S. dollars at the exchange rate of a prior period. That amount is
then compared to the U.S. dollar amount reported in the current
period. The Company calculates Income tax adjustments by adding
discrete tax items to the effect of a change in tax rate for the
reporting period. The Company calculates its income tax rate,
exclusive of income tax adjustments, by removing income tax
adjustments from total Income tax expense, then dividing that
result by Income before income taxes. The Company calculates EBITDA
by removing the following from Net income: Interest expense net,
Income tax expense, Depreciation and amortization, and Income or
loss from Discontinued Operations. Adjusted EBITDA is calculated
by: adding to EBITDA costs associated with restructuring and
pension settlement charges; adding (or subtracting) revaluation
losses (or gains); subtracting (or adding) gains (or losses) from
the sale of buildings or investments; subtracting insurance
recovery gains; and subtracting Income attributable to the
noncontrolling interest in Albany Safran Composites (ASC). The
Company believes that EBITDA and Adjusted EBITDA provide useful
information to investors because they provide an indication of the
strength and performance of the Company's ongoing business
operations, including its ability to fund discretionary spending
such as capital expenditures and strategic investments, as well as
its ability to incur and service debt. While depreciation and
amortization are operating costs under GAAP, they are noncash
expenses equal to current period allocation of costs associated
with capital and other long-lived investments made in prior
periods.
While restructuring expenses, foreign currency revaluation
losses or gains, pension settlement charges, insurance-recovery
gains, and gains or losses from sales of buildings or investments
have an impact on the Company's net income, removing them from
EBITDA can provide, in the opinion of the Company, a better measure
of operating performance. EBITDA is also a calculation commonly
used by investors and analysts to evaluate and compare the periodic
and future operating performance and value of companies. EBITDA, as
defined by the Company, may not be similar to EBITDA measures of
other companies. Such EBITDA measures may not be 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 the estimated effective
annual tax rate and 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.
Table 8
Impact of Percent Net Sales
Changes Change Years ended in Currency excluding December 31,
Percent Translation Currency (in thousands) 2015 2014
Change Rates Rate Effect Machine Clothing (MC)
$608,581 $655,026 -7.1 % ($38,015 )
-1.3 % Albany Engineered Composites (AEC) 101,287
90,319 12.1 % (1,594 ) 13.9 % Total
$709,868 $745,345 -4.8 % ($39,609 )
0.6 %
Table 9
Year
ended December 31, 2015 Albany Corporate
Machine Engineered expenses Total
(in thousands)
Clothing Composites and other Company
Net income $141,311 ($28,478)* ($55,568
) $57,265 Interest expense, net -
- 9,984 9,984 Income tax
(benefit) - - (5,787 )
(5,787 ) Depreciation and amortization 39,503
12,140 8,471 60,114
EBITDA 180,814 (16,338
) (42,900 ) 121,576
Restructuring expenses, net 22,211 -
1,635 23,846 Foreign currency
revaluation losses/(gains) (5,075 ) (17 )
1,498 (3,594 ) Gain on sale of investment -
- (872 ) (872 ) Pre-tax loss
attributable to noncontrolling interest in ASC -
20 - 20
Adjusted
EBITDA $197,950 ($16,335
) ($40,639 ) $140,976
*includes $14 million BR725 charge
Table 10
Year
ended December 31, 2014 Albany Corporate
Machine Engineered expenses Total
(in thousands)
Clothing Composites and other Company
Net income $136,450 ($10,483 ) ($84,218
) $41,749 Interest expense, net -
- 10,713 10,713 Income
tax expense - - 25,751
25,751 Depreciation and amortization 45,066
10,880 8,346 64,292
EBITDA 181,516 397
(39,408 ) 142,505
Restructuring and other, net 4,828 931
- 5,759 Foreign currency revaluation
(gains)/losses (3,921 ) (15 ) (6,374 )
(10,310 ) Gain on insurance recovery - -
(1,126 ) (1,126 ) Pension settlement charge
- - 8,190 8,190
Pretax income attributable to noncontrolling interest in ASC
- (211 ) - (211 )
Adjusted EBITDA $182,423
$1,102 ($38,718 )
$144,807
Table 11
Three
Months ended December 31, 2015
(in thousands, except per share
amounts)
Pre-taxamounts
TaxEffect
After-taxEffect
Per ShareEffect
Restructuring and other, net $9,917 $3,154
$6,763 $0.21 Foreign currency revaluation losses 550
175 375 0.01 Net discrete income tax benefit
- 27,287 27,287 0.85 Favorable effect
of change in income tax rate - 2,489 2,489
0.08
Table 12
Three
Months ended December 31, 2014
(in thousands, except per share
amounts)
Pre-taxamounts
TaxEffect
After-taxEffect
Per ShareEffect
Restructuring and other, net $1,701 $566
$1,135 $0.04 Foreign currency revaluation gains 4,923
1,639 3,284 0.10 Pension settlement charge
8,190 3,194 4,996 0.16 Net discrete
income tax charge - 1,033 1,033 0.03
Favorable effect of change in income tax rate - 858
858 0.03
Table 13
Year
ended December 31, 2015
(in thousands, except per share
amounts)
Pre-taxamounts
TaxEffect
After-taxEffect
Per ShareEffect
Restructuring and other, net $23,846 $8,434
$15,412 $0.48 Foreign currency revaluation gains
3,594 1,422 2,172 0.07 Gain on sale of
investment 872 331 541 0.02 Net
discrete income tax benefit - 22,174 22,174
0.69 Charge for revision in estimated contract profitability
14,000 5,180 8,820 0.28
Table 14
Year
ended December 31, 2014
(in thousands, except per share
amounts)
Pre-taxamounts
TaxEffect
After-taxEffect
Per ShareEffect
Restructuring and other, net $5,759 $2,015
$3,744 $0.12 Foreign currency revaluation gains
10,310 3,535 6,775 0.21 Gain on insurance
recovery 1,126 - 1,126 0.04 Pension
settlement charge 8,190 3,194 4,996
0.16 Net discrete income tax charge - 3,242
3,242 0.10
The following table contains the calculation of net income per
share attributable to the Company, excluding adjustments:
Table 15
Three Months ended Year ended December 31, December
31, Per share amounts (Basic) 2015 2014
2015 2014
Net income attributable to the Company,
reported
$1.17
$0.25
$1.79*
$1.31 Adjustments:
Restructuring charges
0.21 0.04 0.48 0.12
Discrete tax charges/(benefit) and effect of change in
income tax rate (0.93 ) - (0.69 )
0.10 Foreign currency revaluation (gains)/ losses
0.01 (0.10 ) (0.07 ) (0.21 )
Pension settlement charge - 0.16
- 0.16 Gains from sale of investment/insurance
recovery - - (0.02 )
(0.04 ) Net income attributable to the Company, excluding
adjustments $0.46 $0.35 $1.49
$1.44
*includes $0.28 per share for BR725
charge
The following table contains the calculation of net debt:
Table 16
(in thousands)
December 31,2015
September 30,2015
June 30,2015
March 31,2015
December 31,2014
December 31,2013
Notes and loans payable $587 $390 $543
$496 $661 $625 Current maturities of long-term debt
16 50,016 50,015 50,015 50,015
3,764 Long-term debt 265,080 220,084
252,088 232,092 222,096 300,111
Total
debt 265,683 270,490
302,646 282,603 272,772
304,500 Cash and cash equivalents 185,113
171,780 182,474 170,838 179,802 222,666
Net debt $80,570 $98,710
$120,172 $111,765 $92,970
$81,834
This press release may contain statements, estimates, 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,” and similar expressions identify
forward-looking statements, which generally are not historical in
nature. 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) that could cause actual results to differ
materially from the Company’s historical experience and our present
expectations or projections.
Forward-looking statements in this release or in the webcast
include, without limitation, statements about macroeconomic and
paper industry trends and conditions during 2016 and in future
years; expectations in 2016 and in future periods of sales, EBITDA,
Adjusted EBITDA, income, gross profit, gross margin 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 AEC
sales growth potential; 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; the timeline for ASC’s planned facility in
Mexico; 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 CORP. CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data) (unaudited)
Three Months Ended Years Ended December 31,
December 31, 2015 2014 2015 2014
$177,466 $191,659 Net sales $709,868 $745,345 105,800
118,795 Cost of goods sold 431,182 453,710
71,666 72,864 Gross profit 278,686 291,635 35,518 34,411
Selling, general, and administrative expenses 146,192 147,198
11,366 15,938 Technical, product engineering, and research expenses
44,753 59,128 9,917 1,701 Restructuring expenses, net 23,846 5,759
- 8,190 Pension settlement expense - 8,190
14,865 12,624 Operating income 63,895 71,360 1,935
2,592 Interest expense, net 9,984 10,713 1,649 (2,389 )
Other expense/(income), net 2,433 (6,853 ) 11,281
12,421 Income before income taxes 51,478 67,500 (26,185 ) 4,316
Income tax (benefit)/expense (5,787 ) 25,751
37,466 8,105 Net income 57,265 41,749 (114 ) 188 Net
(loss)/income attributable to the noncontrolling interest (14 ) 180
$37,580 $7,917 Net income attributable to the
Company $57,279 $41,569 $1.17 $0.25 Earnings
per share attributable to Company shareholders - Basic $1.79 $1.31
$1.17 $0.25 Earnings per share attributable to Company
shareholders - Diluted $1.79 $1.30 Shares of the Company
used in computing earnings per share: 32,016 31,859 Basic 31,978
31,832 32,059 32,006 Diluted 32,088 31,988 $0.17
$0.16 Dividends per share, Class A and Class B $0.67 $0.63
ALBANY INTERNATIONAL CORP. CONSOLIDATED BALANCE SHEETS (in
thousands, except share data) (unaudited)
December 31, December 31, 2015 2014 ASSETS Cash and
cash equivalents $185,113 $179,802 Accounts receivable, net 146,383
158,237 Inventories 106,406 107,274 Income taxes prepaid and
deferred 2,927 6,743 Asset held for sale 4,988 - Prepaid expenses
and other current assets 6,243 8,074 Total current
assets 452,060 460,130 Property, plant and equipment, net
357,470 395,113 Intangibles 154 385 Goodwill 66,373 71,680 Income
taxes receivable and deferred 108,945 69,540 Other assets 24,560
32,456 Total assets $1,009,562 $1,029,304
LIABILITIES AND SHAREHOLDERS' EQUITY Notes and loans
payable $587 $661 Accounts payable 26,753 34,787 Accrued
liabilities 91,785 95,149 Current maturities of long-term debt 16
50,015 Income taxes payable and deferred 7,090 2,786
Total current liabilities 126,231 183,398 Long-term debt
265,080 222,096 Other noncurrent liabilities 101,544 103,079
Deferred taxes and other credits 14,154 7,163 Total
liabilities 507,009 515,736 SHAREHOLDERS'
EQUITY
Preferred stock, par value $5.00 per
share; authorized 2,000,000 shares; none issued
- -
Class A Common Stock, par value $.001 per
share; authorized 100,000,000 shares; issued 37,238,913 in 2015 and
37,085,489 in 2014
37 37
Class B Common Stock, par value $.001 per
share; authorized 25,000,000 shares; issued and outstanding
3,235,048 in 2015 and 2014
3 3 Additional paid in capital 423,108 418,972 Retained earnings
491,950 456,105 Accumulated items of other comprehensive income:
Translation adjustments (108,655 ) (55,240 ) Pension and
postretirement liability adjustments (48,725 ) (51,666 ) Derivative
valuation adjustment (1,464 ) (861 )
Treasury stock (Class A), at cost
8,455,293 shares in 2015 and 8,459,498 in 2014
(257,391 ) (257,481 ) Total Company shareholders' equity 498,863
509,869 Noncontrolling interest 3,690 3,699 Total equity 502,553
513,568 Total liabilities and shareholders' equity $1,009,562
$1,029,304 ALBANY INTERNATIONAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOW (in thousands) (unaudited)
Three Months Ended Years
Ended December 31, December 31, 2015 2014 2015
2014 OPERATING ACTIVITIES $37,466 $8,105 Net income $57,265
$41,749 Adjustments to reconcile net income to net cash provided by
operating activities: 13,124 14,455 Depreciation 52,974 56,575
1,709 2,096 Amortization 7,140 7,717 (28,295 ) (10,820 ) Change in
long-term liabilities, deferred taxes and other credits (27,358 )
(10,725 ) 608 629 Provision for write-off of property, plant and
equipment 867 1,915 (13 ) -
Fair value adjustment on asset held for
sale
3,212 - 103 8,331 Write-off of pension liability adjustment due to
settlement 103 8,331 - (165 ) Gain on disposition or involuntary
conversion of assets (1,056 ) (1,126 ) (21 ) (40 ) Excess tax
benefit of options exercised (624 ) (201 ) 422 224 Compensation and
benefits paid or payable in Class A Common Stock 1,707 1,384
Changes in operating assets and liabilities that provide/(use)
cash: 3,983 (16,493 ) Accounts receivable (404 ) (6,564 ) 2,480
11,494 Inventories (8,277 ) (744 ) 2,110 1,043 Prepaid expenses and
other current assets 1,253 1,318 (2,564 ) 2,452 Income taxes
prepaid and receivable (3,156 ) 2,566 (1,534 ) 3,507 Accounts
payable (6,001 ) 640 1,220 (2,777 ) Accrued liabilities 2,081
(11,042 ) 5,085 775 Income taxes payable 9,072 1,535 809
(2,620 ) Other, net 7,139 (9,132 ) 36,692 20,196
Net cash provided by operating activities 95,937
84,196 INVESTING ACTIVITIES (8,933 ) (12,118 )
Purchases of property, plant and equipment (48,622 ) (58,224 )
(1,384 ) (145 ) Purchased software (1,973 ) (649 ) - 165
Proceeds from sale or involuntary conversion of assets 2,797
1,126 (10,317 ) (12,098 ) Net cash used in investing
activities (47,798 ) (57,747 ) FINANCING ACTIVITIES 50,308
3,306 Proceeds from borrowings 95,126 13,396 (55,115 ) (14,200 )
Principal payments on debt (102,215 ) (45,124 ) (2 ) - Debt
acquisition costs (1,673 ) - 98 163 Proceeds from options exercised
1,897 773 21 40 Excess tax benefit of options exercised 624 201
(5,442 ) (5,096 ) Dividends paid (21,088 ) (19,729 ) (10,132 )
(15,787 ) Net cash used in financing activities (27,329 ) (50,483 )
(2,910 ) (7,970 ) Effect of exchange rate changes on cash
and cash equivalents (15,499 ) (18,830 ) 13,333 (15,659 )
Increase/(decrease) in cash and cash equivalents 5,311 (42,864 )
171,780 195,461 Cash and cash equivalents at
beginning of period 179,802 222,666 $185,113
$179,802 Cash and cash equivalents at end of period $185,113
$179,802
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160208006227/en/
Albany International Corp.InvestorsJohn Cozzolino,
518-445-2281john.cozzolino@albint.comorMediaSusan Siegel,
603-330-5866susan.siegel@albint.com
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