TriMas Corp. (TRS) Tops Q1 EPS by 4c, Revenues Beat

TriMas Corp. (NASDAQ: TRS) reported Q1 EPS of $0.34, $0.04 better than the analyst estimate of $0.30. Revenue for the quarter came in at $182.79 million versus the consensus estimate of $174.97 million.

TriMas Highlights

• Increased first quarter net sales by 5.4%, driven by acquisitions and solid organic growth in TriMas' Packaging group
• Delivered first quarter diluted EPS from continuing operations of $0.30, while adjusted diluted EPS from continuing operations(1) was $0.34
• Completed the acquisitions of RSA Engineered Products, a manufacturer of complex, highly-engineered products used in aerospace and defense applications, on February 27, 2020, and Rapak, a provider of bag-in-box packaging product lines, on April 17, 2020
• Repurchased approximately 2.8% of its outstanding common stock during first quarter 2020

"Before we discuss our first quarter financial results, I would like to address the current global crisis resulting from the COVID-19 pandemic," said Thomas Amato, TriMas President and Chief Executive Officer. "First and foremost, we are focused on providing a safe working environment for our employees, as they continue to diligently serve our customers in this challenging environment. Our leadership team is closely monitoring daily developments and managing our activities and responses, adjusting work rules and processes to align with regional and national governmental guidance. Virtually all TriMas manufacturing locations globally have been deemed essential businesses and continue to operate in support of our customers, communities and employees."

"In late January, we began experiencing some headwinds associated with the outbreak of COVID-19. Our facilities experienced varying degrees of production inefficiencies, whether due to temporary idling of production, reduced staffing levels, increased absenteeism or lower efficiency due to social distancing and other proactive protective measures taken to ensure the safety of our employees. Despite these challenges, we were able to achieve a first quarter sales growth rate of 5.4%, and adjusted diluted EPS from continuing operations(1) of $0.34. As we move forward through the second quarter of 2020, we expect the impacts of COVID-19 on certain of our end markets will become more severe, most notably in our Aerospace and Specialty Products segments."

"TriMas is a company that provides innovative product solutions into a diverse set of end markets, and we expect this diversity will help us navigate through these unprecedented times. We serve several end markets where demand is robust. For example, TriMas’ Packaging group manufactures dispensers and closures that are used in applications that help fight the spread of germs, improve personal hygiene, and advance home and industrial cleaning, as well as food and beverage, pharmaceutical and nutraceutical applications. In addition, our Specialty Products group supplies steel cylinders that are used for compressed gases in medical oxygen applications, where we have seen a meaningful uptick in orders during the first quarter. However, we also serve some end markets which are more challenged, or that we expect to become more challenged, such as commercial aerospace, oil & gas, and certain applications that ultimately are sold into the restaurant or retail end markets."

"Due to the COVID-19 pandemic and the resulting demand, operational and economic uncertainty caused by it, TriMas is withdrawing its guidance for full year 2020 as we are unable to forecast the impact of this crisis on certain of our businesses with any precision. Across our portfolio, we are managing production capacity to prevailing demand conditions and are taking steps to realign costs for volume shortfalls. We are approaching the uncertainty for the rest of 2020 from a position of strength given our strong balance sheet, ample liquidity and no near-term debt maturities."

"As we move forward, we are even more convinced the steps we took over the past few years to strengthen our balance sheet and de-emphasize certain end markets better position TriMas to manage through this uncertain period. While we, like other companies, are facing unprecedented challenges, we are continuing to monitor the situation carefully to ensure safety, minimize risk, avoid supply chain disruptions and provide continuity of supply to our customers. Despite any potential nearer-term impacts, we remain confident that we will navigate through this crisis and TriMas will become even stronger as a result," Amato concluded.

Outlook

Due to the COVID-19 pandemic and the resulting economic uncertainty, TriMas is withdrawing its full year guidance for 2020, which was previously provided on February 27, 2020.

"While the current environment presents us with uncertainties and challenges, our longer-term growth strategy remains consistent. We believe TriMas is well positioned financially and strategically, and we are confident our TriMas Business Model, strong brands and innovative product solutions, talented and dedicated employees, and relentless commitment to cash conversion position us well for the long term," Amato added.

For earnings history and earnings-related data on TriMas Corp. (TRS) click here.

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