Luxfer Holdings plc (LXFR) Tops Q2 EPS by 3c, Revenues Beat

Luxfer Holdings plc (NYSE: LXFR) reported Q2 EPS of $0.17, $0.03 better than the analyst estimate of $0.14. Revenue for the quarter came in at $89.5 million versus the consensus estimate of $85.15 million.

Second Quarter 2020 Summary

(based on year-over-year comparisons unless otherwise noted)

• Net sales of $89.5 million decreased 23.2%, including a 1.3% unfavorable impact from currency and a 2.7% decrease due to the divestiture of the Czech recycling operation 1
• GAAP net income of $4.1 million, including $0.8 million in restructuring expenses, improved from a net income of $3.5 million; adjusted net income of $4.7 million decreased 62.1%
• GAAP EPS of $0.15, improved from $0.13; adjusted EPS of $0.17 decreased 61.4%
• Adjusted EBITDA of $10.4 million decreased 48.5%; adjusted EBITDA margin of 11.6% decreased 570 basis points
• Free cash flow of $12.1 million increased from negative ($11.7) million in the prior year, with a net debt to EBITDA ratio of 1.5x and no debt maturity until September 2021
• Achieved $0.7 million in incremental net cost savings and remain on track to reach total transformation plan savings of $24 million by year end 2021

“I am very proud of the Luxfer team who together adapted and overcame disruptions brought on by COVID-19. I am grateful for their efforts to ensure business continuity while prioritizing the health and safety of our team members and communities,” stated Luxfer’s Chief Executive Officer, Alok Maskara. “Luxfer’s second quarter results reflect the global macro environment of the COVID-19 pandemic, with broad-based market weakness that was especially evident in our industrial and transportation end-markets. While the environment remains challenging, we made excellent progress on our transformation plan and executed substantial additional actions to partially mitigate the volume declines. In addition to reducing costs, our relentless focus on working capital initiatives resulted in strong free cash flow of $12.1 million in the quarter.”

2020 Guidance

“Given the continued market uncertainty and volatility, Luxfer is not providing financial guidance for the remainder of the year. We will continue to focus on controllable business measures, such as cost reductions and cash generation,” stated Maskara. “We expect the current global economic conditions to continue to have a significant near-term impact on our business and have implemented various measures to position Luxfer for success when markets improve. We have a strong balance sheet and existing credit facilities, which provide financial flexibility that will enable us to emerge from the economic downturn as a stronger company.”

For earnings history and earnings-related data on Luxfer Holdings plc (LXFR) click here.

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