Myers Industries Reports 2019 Second Quarter Results
Updates Full-Year Outlook
AKRON, Ohio--(BUSINESS WIRE)-- Myers Industries, Inc. (NYSE: MYE), a manufacturer of polymer products for industrial, agricultural, automotive, commercial and consumer markets, today announced results for the second quarter ended June 30, 2019.
Second Quarter 2019 Business Highlights
- GAAP income per diluted share from continuing operations was $0.18, compared to $0.26 for the second quarter of 2018; adjusted income per diluted share from continuing operations was $0.27, or flat compared to the second quarter of 2018
- Net sales decreased 4.5% compared to the second quarter of 2018
- Gross profit margin expanded 90 bps to 35.0%
- Operating income decreased 22.3%; adjusted operating income increased 6.0%
- Generated cash flow from continuing operations of $10.9 million and free cash flow of $9.4 million
Updated Full-Year Outlook
- Full-year 2019 net sales are now expected to be down low-to-mid-single digits due primarily to weakness in consumer end market demand
- GAAP income per diluted share from continuing operations is now expected to be in the range of $0.62 to $0.72 for 2019, primarily as a result of a $4 million charge in the second quarter of 2019 for estimated environmental liabilities
- Outlook for adjusted income per diluted share from continuing operations remains in the range of $0.75 to $0.85 for 2019
“Second-quarter adjusted earnings were in line with our expectations, despite softer than anticipated demand in our consumer end market. Net sales were down 4.5% due primarily to continued weakness in the Recreational Vehicle (RV) market and softer than anticipated spring seasonal demand in our consumer end market. We expanded our gross margin to 35.0% and increased adjusted operating income by 6% as volume declines were more than offset by cost discipline, selective price increases and execution of our Distribution Segment transformation,” said Dave Banyard, President and Chief Executive Officer of Myers Industries.
Mr. Banyard continued, “Within our Distribution Segment, we continued to make progress on the transformation. We grew sales for the third consecutive quarter and increased adjusted EBITDA by 16%. With this quarter’s performance, we are on track to meet our Distribution Segment EBITDA margin goal of 10% by the end of 2020.”
|
Quarter Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||||
(Dollars in thousands, except per share data) |
2019 |
2018 |
% Inc
|
|
2019 |
2018 |
% Inc
|
||||||||||
Net sales |
$ |
134,285 |
|
$ |
140,560 |
|
(4.5 |
)% |
$ |
273,400 |
|
$ |
293,128 |
|
(6.7 |
)% |
|
Gross profit |
$ |
46,936 |
|
$ |
47,991 |
|
(2.2 |
)% |
$ |
92,495 |
|
$ |
95,106 |
|
(2.7 |
)% |
|
Gross profit margin |
|
35.0 |
% |
|
34.1 |
% |
|
|
|
33.8 |
% |
|
32.4 |
% |
|
|
|
Operating income |
$ |
10,182 |
|
$ |
13,111 |
|
(22.3 |
)% |
$ |
20,400 |
|
$ |
25,133 |
|
(18.8 |
)% |
|
Income from continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income |
$ |
6,606 |
|
$ |
8,608 |
|
(23.3 |
)% |
$ |
13,249 |
|
$ |
16,363 |
|
(19.0 |
)% |
|
Income per diluted share |
$ |
0.18 |
|
$ |
0.26 |
|
(30.8 |
)% |
$ |
0.37 |
|
$ |
0.51 |
|
(27.5 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income as adjusted(1) |
$ |
14,182 |
|
$ |
13,381 |
|
6.0 |
% |
$ |
26,389 |
|
$ |
24,880 |
|
6.1 |
% |
|
Income from continuing operations as adjusted(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income |
$ |
9,610 |
|
$ |
9,051 |
|
6.2 |
% |
$ |
17,756 |
|
$ |
16,446 |
|
8.0 |
% |
|
Income per diluted share |
$ |
0.27 |
|
$ |
0.27 |
|
0.0 |
% |
$ |
0.50 |
|
$ |
0.51 |
|
(2.0 |
)% |
|
EBITDA as adjusted |
$ |
20,145 |
|
$ |
19,931 |
|
1.1 |
% |
$ |
38,249 |
|
$ |
37,978 |
|
0.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Detail regarding the adjustments is provided on the Reconciliations of Non-GAAP Financial Measures included in this release. |
|||||||||||||||||
Second quarter 2019 net sales decreased $6.3 million or 4.5% (4.2% excluding currency fluctuation) to $134.3 million, compared to the second quarter of 2018. The decrease was the result of a sales decline in the Material Handling Segment. Gross profit decreased $1.1 million to $46.9 million, compared to the second quarter of 2018. Gross profit margin increased 90 basis points to 35.0%. Favorable price-cost margin offset lower sales volume and an unfavorable sales mix during the quarter. Selling, general and administrative expenses increased $2.3 million to $36.8 million, compared to the second quarter of 2018, due mostly to a $4 million charge for estimated environmental liabilities related to the New Idria Mercury Mine, which was partially offset by lower variable compensation and benefit costs and savings from the Distribution Segment’s transformation initiatives. GAAP income per diluted share from continuing operations was $0.18, compared to $0.26 for the second quarter of 2018. Adjusted income per diluted share from continuing operations was $0.27, which was flat compared to the second quarter of 2018.
Segment Results
Net sales in the Material Handling Segment for the second quarter of 2019 decreased $7.2 million or 7.0% (6.7% excluding currency fluctuation) compared to the second quarter of 2018. The decrease in net sales was primarily due to sales decreases in the Company’s vehicle (RV market decline) and consumer (lower fuel can sales) end markets. The segment’s adjusted EBITDA declined 1.0% to $23.2 million for the 2019 second quarter, compared to $23.4 million in 2018. Favorable price-cost margin mostly offset the impact of the lower sales volume and unfavorable sales mix. Material Handling EBITDA margin increased 150 basis points to 24.2%.
Net sales in the Distribution Segment for the second quarter of 2019 increased $0.9 million or 2.4% compared to the second quarter of 2018. The segment’s adjusted EBITDA increased 16.3% to $3.6 million compared to the second quarter of 2018, due primarily to savings from the segment’s transformation plan and higher sales volume. The Company continues to execute its transformation plan, which includes enhancements in its go-to-market strategy, the implementation of 80/20 to drive improved contribution margins, and optimization of its logistics and overhead costs, with a goal to expand Distribution Segment EBITDA margin to 10% by the end of 2020. Distribution EBITDA margin increased 120 basis points to 9.4%.
2019 Outlook
For the full-year 2019, the Company now anticipates that total revenue year-over-year will be down low-to-mid-single digits on a constant currency basis versus its previous expectation of flat year-over-year revenue. While the Company anticipates full-year sales growth in its auto aftermarket and industrial end markets, it expects that growth to be more than offset by lower year-over-year demand in its food and beverage, consumer and vehicle end markets.
“The important spring selling season for outdoor power equipment was unusually weak due to the historic wet weather conditions experienced across much of the country. This sluggish start to the year took a toll on our consumer end market demand, which we anticipate will continue to be weak in the third quarter and will not recover by year-end. While we expect to offset some of the decline with our new product launch, this incremental revenue will not be enough to overcome the market decline, so we are adjusting our full-year sales outlook,” said Mr. Banyard.
Mr. Banyard continued, “At this point, we are cautious about the state of demand for the rest of the year. Seasonally, the fourth quarter is less affected by our consumer end market; however, demand in our food and beverage end market remains uncertain due to the late planting season in the U.S. farming sector. Despite these top-line challenges, our focus on improving operating margins by optimizing pricing, executing on various cost and productivity initiatives and delivering on our Distribution Segment transformation plan is expected to lead to growth in our adjusted operating margins in 2019.”
The Company expects depreciation and amortization to be approximately $25 million, net interest expense to be approximately $5 million, and the effective tax rate to be approximately 27%. GAAP income per diluted share from continuing operations is now estimated to be in the range of $0.62 to $0.72, which is updated from its previous estimates in the range of $0.70 to $0.80, primarily as a result of a $4 million charge in the second quarter for estimated environmental liabilities. The Company continues to expect adjusted income per diluted share from continuing operations to be in the range of $0.75 to $0.85, based on a fully diluted share count of 36 million shares. Capital expenditures are anticipated to be approximately $10 million.
Conference Call Details
The Company will host an earnings conference call and webcast for investors and analysts on Tuesday, July 30, at 8:30 a.m. ET. The call is anticipated to last approximately one hour and may be accessed by dialing: (US) 833-233-3452 or (Int’l) 647-689-4129. The Conference ID # is 9864717. Callers are asked to sign on at least five minutes in advance. The live webcast of the conference call can be accessed from the Investor Relations section of the Company's website at www.myersindustries.com. Click on the Investor Relations tab to access the webcast. Webcast attendees will be in a listen-only mode. An archived replay of the call will also be available on the site shortly after the event. To listen to the telephone replay, callers should dial: (US) 800-585-8367 or (Int’l) 416-621-4642. The Conference ID # is 9864717.
Use of Non-GAAP Financial Measures
The Company uses certain non-GAAP measures in this release. Adjusted income per diluted share from continuing operations, operating income as adjusted, income from continuing operations as adjusted, EBITDA as adjusted, adjusted operating income, adjusted EBITDA, adjusted EPS and free cash flow are non-GAAP financial measures and are intended to serve as a supplement to results provided in accordance with accounting principles generally accepted in the United States. Myers Industries believes that such information provides an additional measurement and consistent historical comparison of the Company’s performance. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is available in this news release.
About Myers Industries
Myers Industries, Inc. is an international manufacturer of polymer products for industrial, agricultural, automotive, commercial and consumer markets. The Company is also the largest distributor of tools, equipment and supplies for the tire, wheel and under vehicle service industry in the United States. Visit www.myersindustries.com to learn more.
Caution on Forward-Looking Statements
Statements in this release include “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statement that is not of historical fact may be deemed “forward-looking”. Words such as “expect”, “believe”, “project”, “plan”, “anticipate”, “intend”, “objective”, “outlook”, “target”, “goal”, “view” and similar expressions identify forward-looking statements. These statements are based on management's current views and assumptions of future events and financial performance and involve a number of risks and uncertainties, many outside of the Company's control that could cause actual results to materially differ from those expressed or implied. Risks and uncertainties include: raw material availability, increases in raw material costs, or other production costs; risks associated with our strategic growth initiatives or the failure to achieve the anticipated benefits of such initiatives; unanticipated downturn in business relationships with customers or their purchases; competitive pressures on sales and pricing; changes in the markets for the Company's business segments; changes in trends and demands in the markets in which the Company competes; operational problems at our manufacturing facilities, or unexpected failures at those facilities; future economic and financial conditions in the United States and around the world; inability of the Company to meet future capital requirements; claims, litigation and regulatory actions against the Company; changes in laws and regulations affecting the Company; and other risks as detailed in the Company's 10-K and other reports filed with the Securities and Exchange Commission. Such reports are available on the Securities and Exchange Commission's public reference facilities and its website at www.sec.gov and on the Company's Investor Relations section of its website at www.myersindustries.com. Myers Industries undertakes no obligation to publicly update or revise any forward-looking statements contained herein. These statements speak only as of the date made.
MYERS INDUSTRIES, INC. |
||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) |
||||||||||||||||
(Dollars in thousands, except share and per share data) |
||||||||||||||||
|
|
Quarter Ended |
|
|
Six Months Ended |
|||||||||||
|
|
June 30, 2019 |
|
June 30, 2018 |
|
|
June 30, 2019 |
|
June 30, 2018 |
|||||||
Net sales |
|
$ |
134,285 |
|
|
$ |
140,560 |
|
|
$ |
273,400 |
|
|
$ |
293,128 |
|
Cost of sales |
|
|
87,349 |
|
|
|
92,569 |
|
|
|
180,905 |
|
|
|
198,022 |
|
Gross profit |
|
|
46,936 |
|
|
|
47,991 |
|
|
|
92,495 |
|
|
|
95,106 |
|
Selling, general and administrative expenses |
|
|
36,809 |
|
|
|
34,506 |
|
|
|
71,277 |
|
|
|
69,979 |
|
(Gain) loss on disposal of fixed assets |
|
|
(55 |
) |
|
|
66 |
|
|
|
(98 |
) |
|
|
(314 |
) |
Impairment charges |
|
|
— |
|
|
|
308 |
|
|
|
916 |
|
|
|
308 |
|
Operating income |
|
|
10,182 |
|
|
|
13,111 |
|
|
|
20,400 |
|
|
|
25,133 |
|
Interest expense, net |
|
|
1,017 |
|
|
|
1,313 |
|
|
|
2,066 |
|
|
|
2,952 |
|
Income from continuing operations before income taxes |
|
|
9,165 |
|
|
|
11,798 |
|
|
|
18,334 |
|
|
|
22,181 |
|
Income tax expense |
|
|
2,559 |
|
|
|
3,190 |
|
|
|
5,085 |
|
|
|
5,818 |
|
Income from continuing operations |
|
|
6,606 |
|
|
|
8,608 |
|
|
|
13,249 |
|
|
|
16,363 |
|
Income (loss) from discontinued operations, net of income tax |
|
|
— |
|
|
|
— |
|
|
|
127 |
|
|
|
(911 |
) |
Net income |
|
$ |
6,606 |
|
|
$ |
8,608 |
|
|
$ |
13,376 |
|
|
$ |
15,452 |
|
Income per common share from continuing operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.19 |
|
|
$ |
0.26 |
|
|
$ |
0.37 |
|
|
$ |
0.52 |
|
Diluted |
|
$ |
0.18 |
|
|
$ |
0.26 |
|
|
$ |
0.37 |
|
|
$ |
0.51 |
|
Income (loss) per common share from discontinued operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(0.03 |
) |
Diluted |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
(0.03 |
) |
Net income per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.19 |
|
|
$ |
0.26 |
|
|
$ |
0.37 |
|
|
$ |
0.49 |
|
Diluted |
|
$ |
0.18 |
|
|
$ |
0.26 |
|
|
$ |
0.37 |
|
|
$ |
0.48 |
|
Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
35,471,795 |
|
|
|
32,606,838 |
|
|
|
35,430,392 |
|
|
|
31,561,194 |
|
Diluted |
|
|
35,743,563 |
|
|
|
33,084,540 |
|
|
|
35,753,054 |
|
|
|
32,081,350 |
|
MYERS INDUSTRIES, INC. |
||||||||||||||||||||||||
SALES AND EARNINGS BY SEGMENT (UNAUDITED) |
||||||||||||||||||||||||
(Dollars in thousands) |
||||||||||||||||||||||||
|
|
Quarter Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||||||||||
|
|
2019 |
|
2018 |
|
% Change |
|
2019 |
|
2018 |
|
% Change |
||||||||||||
Net sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Material Handling |
|
$ |
95,902 |
|
|
$ |
103,130 |
|
|
|
(7.0 |
)% |
|
$ |
198,853 |
|
|
$ |
219,939 |
|
|
|
(9.6 |
)% |
Distribution |
|
|
38,395 |
|
|
|
37,477 |
|
|
|
2.4 |
% |
|
|
74,569 |
|
|
|
73,258 |
|
|
|
1.8 |
% |
Inter-company Sales |
|
|
(12 |
) |
|
|
(47 |
) |
|
|
- |
|
|
|
(22 |
) |
|
|
(69 |
) |
|
|
- |
|
Total |
|
$ |
134,285 |
|
|
$ |
140,560 |
|
|
|
(4.5 |
)% |
|
$ |
273,400 |
|
|
$ |
293,128 |
|
|
|
(6.7 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Material Handling |
|
$ |
17,589 |
|
|
$ |
17,323 |
|
|
|
1.5 |
% |
|
$ |
33,796 |
|
|
$ |
34,053 |
|
|
|
(0.8 |
)% |
Distribution |
|
|
3,328 |
|
|
|
2,786 |
|
|
|
19.5 |
% |
|
|
3,541 |
|
|
|
4,524 |
|
|
|
(21.7 |
)% |
Corporate |
|
|
(10,735 |
) |
|
|
(6,998 |
) |
|
|
- |
|
|
|
(16,937 |
) |
|
|
(13,444 |
) |
|
|
- |
|
Total |
|
$ |
10,182 |
|
|
$ |
13,111 |
|
|
|
(22.3 |
)% |
|
$ |
20,400 |
|
|
$ |
25,133 |
|
|
|
(18.8 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss) as adjusted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Material Handling |
|
$ |
17,589 |
|
|
$ |
17,285 |
|
|
|
1.8 |
% |
|
$ |
34,884 |
|
|
$ |
34,157 |
|
|
|
2.1 |
% |
Distribution |
|
|
3,328 |
|
|
|
2,786 |
|
|
|
19.5 |
% |
|
|
4,442 |
|
|
|
3,859 |
|
|
|
15.1 |
% |
Corporate |
|
|
(6,735 |
) |
|
|
(6,690 |
) |
|
|
- |
|
|
|
(12,937 |
) |
|
|
(13,136 |
) |
|
|
- |
|
Total |
|
$ |
14,182 |
|
|
$ |
13,381 |
|
|
|
6.0 |
% |
|
$ |
26,389 |
|
|
$ |
24,880 |
|
|
|
6.1 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income margin as adjusted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Material Handling |
|
|
18.3 |
% |
|
|
16.8 |
% |
|
|
|
|
|
|
17.5 |
% |
|
|
15.5 |
% |
|
|
|
|
Distribution |
|
|
8.7 |
% |
|
|
7.4 |
% |
|
|
|
|
|
|
6.0 |
% |
|
|
5.3 |
% |
|
|
|
|
Corporate |
|
n/a |
|
|
n/a |
|
|
|
|
|
|
n/a |
|
|
n/a |
|
|
|
|
|
||||
Total |
|
|
10.6 |
% |
|
|
9.5 |
% |
|
|
|
|
|
|
9.7 |
% |
|
|
8.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA as adjusted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Material Handling |
|
$ |
23,177 |
|
|
$ |
23,407 |
|
|
|
(1.0 |
)% |
|
$ |
45,997 |
|
|
$ |
46,391 |
|
|
|
(0.8 |
)% |
Distribution |
|
|
3,591 |
|
|
|
3,087 |
|
|
|
16.3 |
% |
|
|
4,967 |
|
|
|
4,469 |
|
|
|
11.1 |
% |
Corporate |
|
|
(6,623 |
) |
|
|
(6,563 |
) |
|
|
- |
|
|
|
(12,715 |
) |
|
|
(12,882 |
) |
|
|
- |
|
Total |
|
$ |
20,145 |
|
|
$ |
19,931 |
|
|
|
1.1 |
% |
|
$ |
38,249 |
|
|
$ |
37,978 |
|
|
|
0.7 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA margin as adjusted |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Material Handling |
|
|
24.2 |
% |
|
|
22.7 |
% |
|
|
|
|
|
|
23.1 |
% |
|
|
21.1 |
% |
|
|
|
|
Distribution |
|
|
9.4 |
% |
|
|
8.2 |
% |
|
|
|
|
|
|
6.7 |
% |
|
|
6.1 |
% |
|
|
|
|
Corporate |
|
n/a |
|
|
n/a |
|
|
|
|
|
|
n/a |
|
|
n/a |
|
|
|
|
|
||||
Total |
|
|
15.0 |
% |
|
|
14.2 |
% |
|
|
|
|
|
|
14.0 |
% |
|
|
13.0 |
% |
|
|
|
|
MYERS INDUSTRIES, INC. |
||||||
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED) |
||||||
(Dollars in thousands) |
||||||
|
|
June 30, 2019 |
|
December 31, 2018 |
||
Assets |
|
|
|
|
|
|
Current Assets |
|
|
|
|
|
|
Cash |
|
$ |
75,205 |
|
$ |
58,894 |
Accounts receivable, net |
|
|
73,120 |
|
|
72,939 |
Income tax receivable |
|
|
— |
|
|
4,892 |
Inventories |
|
|
42,341 |
|
|
43,596 |
Prepaid expenses and other current assets |
|
|
4,600 |
|
|
2,534 |
Total Current Assets |
|
|
195,266 |
|
|
182,855 |
Property, plant, & equipment, net |
|
|
57,216 |
|
|
65,460 |
Right of use asset - operating leases |
|
|
5,983 |
|
|
— |
Deferred income taxes |
|
|
6,490 |
|
|
5,270 |
Other assets |
|
|
88,041 |
|
|
95,060 |
Total Assets |
|
$ |
352,996 |
|
$ |
348,645 |
Liabilities & Shareholders' Equity |
|
|
|
|
|
|
Current Liabilities |
|
|
|
|
|
|
Accounts payable |
|
$ |
52,827 |
|
$ |
60,849 |
Accrued expenses |
|
|
31,738 |
|
|
36,574 |
Operating lease liability - short-term |
|
|
2,000 |
|
|
— |
Total Current Liabilities |
|
|
86,565 |
|
|
97,423 |
Long-term debt |
|
|
76,983 |
|
|
76,790 |
Operating lease liability - long-term |
|
|
4,225 |
|
|
— |
Other liabilities |
|
|
22,813 |
|
|
19,794 |
Total Shareholders' Equity |
|
|
162,410 |
|
|
154,638 |
Total Liabilities & Shareholders' Equity |
|
$ |
352,996 |
|
$ |
348,645 |
MYERS INDUSTRIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Dollars in thousands) |
||||||||
|
|
Six Months Ended June 30, |
||||||
|
|
2019 |
|
2018 |
||||
Cash Flows From Operating Activities |
|
|
|
|
|
|
|
|
Net income |
|
$ |
13,376 |
|
|
$ |
15,452 |
|
Income (loss) from discontinued operations, net of income taxes |
|
|
127 |
|
|
|
(911 |
) |
Income from continuing operations |
|
|
13,249 |
|
|
|
16,363 |
|
Adjustments to reconcile income (loss) from continuing operations to net cash provided by (used for) operating activities |
|
|
|
|
|
|
|
|
Depreciation |
|
|
8,051 |
|
|
|
9,042 |
|
Amortization |
|
|
4,046 |
|
|
|
4,315 |
|
Accelerated depreciation associated with restructuring activities |
|
|
— |
|
|
|
16 |
|
Non-cash stock-based compensation expense |
|
|
2,220 |
|
|
|
2,305 |
|
(Gain) loss on disposal of fixed assets |
|
|
(98 |
) |
|
|
(314 |
) |
Impairment charges |
|
|
916 |
|
|
|
308 |
|
Other |
|
|
340 |
|
|
|
(215 |
) |
Payments on performance based compensation |
|
|
(413 |
) |
|
|
(1,249 |
) |
Other long-term liabilities |
|
|
3,514 |
|
|
|
(63 |
) |
Cash flows provided by (used for) working capital |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(56 |
) |
|
|
9,106 |
|
Inventories |
|
|
1,450 |
|
|
|
(2,454 |
) |
Prepaid expenses and other current assets |
|
|
(2,041 |
) |
|
|
(1,807 |
) |
Accounts payable and accrued expenses |
|
|
(15,005 |
) |
|
|
(8,130 |
) |
Net cash provided by (used for) operating activities - continuing operations |
|
|
16,173 |
|
|
|
27,223 |
|
Net cash provided by (used for) operating activities - discontinued operations |
|
|
7,297 |
|
|
|
981 |
|
Net cash provided by (used for) operating activities |
|
|
23,470 |
|
|
|
28,204 |
|
Cash Flows From Investing Activities |
|
|
|
|
|
|
|
|
Capital expenditures |
|
|
(4,406 |
) |
|
|
(2,318 |
) |
Proceeds from sale of property, plant and equipment |
|
|
7,514 |
|
|
|
2,633 |
|
Net cash provided by (used for) investing activities - continuing operations |
|
|
3,108 |
|
|
|
315 |
|
Net cash provided by (used for) investing activities - discontinued operations |
|
|
— |
|
|
|
— |
|
Net cash provided by (used for) investing activities |
|
|
3,108 |
|
|
|
315 |
|
Cash Flows From Financing Activities |
|
|
|
|
|
|
|
|
Net borrowing (repayments) on credit facility |
|
|
— |
|
|
|
(72,491 |
) |
Cash dividends paid |
|
|
(9,733 |
) |
|
|
(8,287 |
) |
Proceeds from issuance of common stock |
|
|
365 |
|
|
|
875 |
|
Proceeds from public offering of common stock, net of equity issuance costs |
|
|
— |
|
|
|
79,522 |
|
Shares withheld for employee taxes on equity awards |
|
|
(978 |
) |
|
|
(371 |
) |
Net cash provided by (used for) financing activities - continuing operations |
|
|
(10,346 |
) |
|
|
(752 |
) |
Net cash provided by (used for) financing activities - discontinued operations |
|
|
— |
|
|
|
— |
|
Net cash provided by (used for) financing activities |
|
|
(10,346 |
) |
|
|
(752 |
) |
Foreign exchange rate effect on cash |
|
|
79 |
|
|
|
(6 |
) |
Net increase in cash and restricted cash |
|
|
16,311 |
|
|
|
27,761 |
|
Cash and restricted cash at January 1 |
|
|
58,894 |
|
|
|
11,179 |
|
Cash and restricted cash at June 30 |
|
$ |
75,205 |
|
|
$ |
38,940 |
|
MYERS INDUSTRIES, INC. |
|||||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||||||||||||||
GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) |
|||||||||||||||||||
(Dollars in thousands) |
|||||||||||||||||||
|
Quarter Ended June 30, 2019 |
||||||||||||||||||
|
Material
|
Distribution |
Segment
|
Corporate
|
Total |
||||||||||||||
GAAP Net sales |
$ |
95,902 |
|
$ |
38,395 |
|
$ |
134,297 |
|
$ |
(12 |
) |
$ |
134,285 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
GAAP Gross profit |
|
|
|
|
|
|
|
46,936 |
|
|
— |
|
|
46,936 |
|
||||
Add: Restructuring expenses and other adjustments |
|
|
|
|
|
|
|
— |
|
|
— |
|
|
— |
|
||||
Gross profit as adjusted |
|
|
|
|
|
|
|
46,936 |
|
|
— |
|
|
46,936 |
|
||||
Gross profit margin as adjusted |
|
|
|
|
|
|
|
34.9 |
% |
n/a |
|
|
35.0 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
GAAP Operating income (loss) |
|
17,589 |
|
|
3,328 |
|
|
20,917 |
|
|
(10,735 |
) |
|
10,182 |
|
||||
Add: Environmental charges |
|
— |
|
|
— |
|
|
— |
|
|
4,000 |
|
|
4,000 |
|
||||
Operating income (loss) as adjusted |
|
17,589 |
|
|
3,328 |
|
|
20,917 |
|
|
(6,735 |
) |
|
14,182 |
|
||||
Operating income margin as adjusted |
|
18.3 |
% |
|
8.7 |
% |
|
15.6 |
% |
n/a |
|
|
10.6 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Add: Depreciation and amortization |
|
5,588 |
|
|
263 |
|
|
5,851 |
|
|
112 |
|
|
5,963 |
|
||||
Less: Depreciation adjustments |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
||||
EBITDA as adjusted |
$ |
23,177 |
|
$ |
3,591 |
|
$ |
26,768 |
|
$ |
(6,623 |
) |
$ |
20,145 |
|
||||
EBITDA margin as adjusted |
|
24.2 |
% |
|
9.4 |
% |
|
19.9 |
% |
n/a |
|
|
15.0 |
% |
|||||
|
|
||||||||||||||||||
|
Quarter Ended June 30, 2018 |
||||||||||||||||||
|
Material
|
Distribution |
Segment
|
Corporate
|
Total |
||||||||||||||
GAAP Net sales |
$ |
103,130 |
|
$ |
37,477 |
|
$ |
140,607 |
|
$ |
(47 |
) |
$ |
140,560 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
GAAP Gross profit |
|
|
|
|
|
|
|
47,991 |
|
|
— |
|
|
47,991 |
|
||||
Add: Restructuring expenses and other adjustments |
|
|
|
|
|
|
|
170 |
|
|
— |
|
|
170 |
|
||||
Gross profit as adjusted |
|
|
|
|
|
|
|
48,161 |
|
|
— |
|
|
48,161 |
|
||||
Gross profit margin as adjusted |
|
|
|
|
|
|
|
34.3 |
% |
n/a |
|
|
34.3 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
GAAP Operating income (loss) |
|
17,323 |
|
|
2,786 |
|
|
20,109 |
|
|
(6,998 |
) |
|
13,111 |
|
||||
Add: Restructuring expenses and other adjustments(1) |
|
170 |
|
|
— |
|
|
170 |
|
|
— |
|
|
170 |
|
||||
Add: Asset impairment |
|
— |
|
|
— |
|
|
— |
|
|
308 |
|
|
308 |
|
||||
Add: Loss (gain) on sale of assets |
|
(208 |
) |
|
— |
|
|
(208 |
) |
|
— |
|
|
(208 |
) |
||||
Operating income (loss) as adjusted |
|
17,285 |
|
|
2,786 |
|
|
20,071 |
|
|
(6,690 |
) |
|
13,381 |
|
||||
Operating income margin as adjusted |
|
16.8 |
% |
|
7.4 |
% |
|
14.3 |
% |
n/a |
|
|
9.5 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Add: Depreciation and amortization |
|
6,188 |
|
|
301 |
|
|
6,489 |
|
|
127 |
|
|
6,616 |
|
||||
Less: Depreciation adjustments |
|
(66 |
) |
|
— |
|
|
(66 |
) |
|
— |
|
|
(66 |
) |
||||
EBITDA as adjusted |
$ |
23,407 |
|
$ |
3,087 |
|
$ |
26,494 |
|
$ |
(6,563 |
) |
$ |
19,931 |
|
||||
EBITDA margin as adjusted |
|
22.7 |
% |
|
8.2 |
% |
|
18.8 |
% |
n/a |
|
|
14.2 |
% |
|||||
(1) Includes gross profit adjustments of $170 |
|
||||||||||||||||||
MYERS INDUSTRIES, INC. |
|||||||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||||||||||||||
GROSS PROFIT, OPERATING INCOME AND EBITDA (UNAUDITED) |
|||||||||||||||||||
(Dollars in thousands) |
|||||||||||||||||||
|
Six Months Ended June 30, 2019 |
||||||||||||||||||
|
Material
|
Distribution |
Segment
|
Corporate
|
Total |
||||||||||||||
GAAP Net sales |
$ |
198,853 |
|
$ |
74,569 |
|
$ |
273,422 |
|
$ |
(22 |
) |
$ |
273,400 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
GAAP Gross profit |
|
|
|
|
|
|
|
92,495 |
|
|
— |
|
|
92,495 |
|
||||
Add: Restructuring expenses and other adjustments |
|
|
|
|
|
|
|
172 |
|
|
— |
|
|
172 |
|
||||
Gross profit as adjusted |
|
|
|
|
|
|
|
92,667 |
|
|
— |
|
|
92,667 |
|
||||
Gross profit margin as adjusted |
|
|
|
|
|
|
|
33.9 |
% |
n/a |
|
|
33.9 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
GAAP Operating income (loss) |
|
33,796 |
|
|
3,541 |
|
|
37,337 |
|
|
(16,937 |
) |
|
20,400 |
|
||||
Add: Restructuring expenses and other adjustments(1) |
|
172 |
|
|
901 |
|
|
1,073 |
|
|
— |
|
|
1,073 |
|
||||
Add: Asset impairment |
|
916 |
|
|
— |
|
|
916 |
|
|
— |
|
|
916 |
|
||||
Add: Environmental charges |
|
— |
|
|
— |
|
|
— |
|
|
4,000 |
|
|
4,000 |
|
||||
Operating income (loss) as adjusted |
|
34,884 |
|
|
4,442 |
|
|
39,326 |
|
|
(12,937 |
) |
|
26,389 |
|
||||
Operating income margin as adjusted |
|
17.5 |
% |
|
6.0 |
% |
|
14.4 |
% |
n/a |
|
|
9.7 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Add: Depreciation and amortization |
|
11,157 |
|
|
525 |
|
|
11,682 |
|
|
222 |
|
|
11,904 |
|
||||
Less: Depreciation adjustments |
|
(44 |
) |
|
— |
|
|
(44 |
) |
|
— |
|
|
(44 |
) |
||||
EBITDA as adjusted |
$ |
45,997 |
|
$ |
4,967 |
|
$ |
50,964 |
|
$ |
(12,715 |
) |
$ |
38,249 |
|
||||
EBITDA margin as adjusted |
|
23.1 |
% |
|
6.7 |
% |
|
18.6 |
% |
n/a |
|
|
14.0 |
% |
|||||
(1) Includes gross profit adjustments of $172 and SG&A adjustments of $901 |
|
||||||||||||||||||
|
Six Months Ended June 30, 2018 |
||||||||||||||||||
|
Material
|
Distribution |
Segment
|
Corporate
|
Total |
||||||||||||||
GAAP Net sales |
$ |
219,939 |
|
$ |
73,258 |
|
$ |
293,197 |
|
$ |
(69 |
) |
$ |
293,128 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
GAAP Gross profit |
|
|
|
|
|
|
|
95,106 |
|
|
— |
|
|
95,106 |
|
||||
Add: Restructuring expenses and other adjustments |
|
|
|
|
|
|
|
289 |
|
|
— |
|
|
289 |
|
||||
Gross profit as adjusted |
|
|
|
|
|
|
|
95,395 |
|
|
— |
|
|
95,395 |
|
||||
Gross profit margin as adjusted |
|
|
|
|
|
|
|
32.5 |
% |
n/a |
|
|
32.5 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
GAAP Operating income (loss) |
|
34,053 |
|
|
4,524 |
|
|
38,577 |
|
|
(13,444 |
) |
|
25,133 |
|
||||
Add: Restructuring expenses and other adjustments(1) |
|
312 |
|
|
— |
|
|
312 |
|
|
— |
|
|
312 |
|
||||
Add: Asset impairment |
|
— |
|
|
— |
|
|
— |
|
|
308 |
|
|
308 |
|
||||
Add: Loss (gain) on sale of assets |
|
(208 |
) |
|
(665 |
) |
|
(873 |
) |
|
— |
|
|
(873 |
) |
||||
Operating income (loss) as adjusted |
|
34,157 |
|
|
3,859 |
|
|
38,016 |
|
|
(13,136 |
) |
|
24,880 |
|
||||
Operating income margin as adjusted |
|
15.5 |
% |
|
5.3 |
% |
|
13.0 |
% |
n/a |
|
|
8.5 |
% |
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Add: Depreciation and amortization |
|
12,316 |
|
|
610 |
|
|
12,926 |
|
|
254 |
|
|
13,180 |
|
||||
Less: Depreciation adjustments |
|
(82 |
) |
|
— |
|
|
(82 |
) |
|
— |
|
|
(82 |
) |
||||
EBITDA as adjusted |
$ |
46,391 |
|
$ |
4,469 |
|
$ |
50,860 |
|
$ |
(12,882 |
) |
$ |
37,978 |
|
||||
EBITDA margin as adjusted |
|
21.1 |
% |
|
6.1 |
% |
|
17.3 |
% |
n/a |
|
|
13.0 |
% |
|||||
(1) Includes gross profit adjustments of $289 and SG&A adjustments of $23 |
|||||||||||||||||||
MYERS INDUSTRIES, INC. |
|||||||||||||||
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES |
|||||||||||||||
INCOME AND EARNINGS PER DILUTED SHARE (UNAUDITED) |
|||||||||||||||
(Dollars in thousands, except per share data) |
|||||||||||||||
|
Quarter Ended June 30, |
Six Months Ended June 30, |
|||||||||||||
|
2019 |
2018 |
2019 |
|
2018 |
||||||||||
GAAP Operating income |
$ |
10,182 |
|
$ |
13,111 |
|
$ |
20,400 |
|
$ |
25,133 |
|
|||
Add: Restructuring expenses and other adjustments |
|
— |
|
|
170 |
|
|
1,073 |
|
|
312 |
|
|||
Add: Asset impairments |
|
— |
|
|
308 |
|
|
916 |
|
|
308 |
|
|||
Add: Environmental charges |
|
4,000 |
|
|
— |
|
|
4,000 |
|
|
— |
|
|||
Add: Loss (gain) on sale of assets |
|
— |
|
|
(208 |
) |
|
— |
|
|
(873 |
) |
|||
Operating income as adjusted |
|
14,182 |
|
|
13,381 |
|
|
26,389 |
|
|
24,880 |
|
|||
Less: Interest expense, net |
|
(1,017 |
) |
|
(1,313 |
) |
|
(2,066 |
) |
|
(2,952 |
) |
|||
Income before taxes as adjusted |
|
13,165 |
|
|
12,068 |
|
|
24,323 |
|
|
21,928 |
|
|||
Less: Income tax expense(1) |
|
(3,555 |
) |
|
(3,017 |
) |
|
(6,567 |
) |
|
(5,482 |
) |
|||
Income from continuing operations as adjusted |
$ |
9,610 |
|
$ |
9,051 |
|
$ |
17,756 |
|
$ |
16,446 |
|
|||
Adjusted earnings per diluted share from continuing operations |
$ |
0.27 |
|
$ |
0.27 |
|
$ |
0.50 |
|
$ |
0.51 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
(1) Income taxes are calculated using the normalized effective tax rate for each year. The rate used in 2019 is 27% and in 2018 was 25%. |
|||||||||||||||
|
|
||||||||||||||
MYERS INDUSTRIES, INC. |
||||||||||||
RECONCILIATION OF FREE CASH FLOW TO GAAP NET CASH PROVIDED BY |
||||||||||||
(USED FOR) OPERATING ACTIVITIES – CONTINUING OPERATIONS |
||||||||||||
(UNAUDITED) |
||||||||||||
(Dollars in thousands) |
||||||||||||
|
|
YTD |
|
YTD |
|
|
|
|
||||
|
|
June 30, 2019 |
|
June 30, 2018 |
|
|
|
|
||||
Net cash provided by (used for) operating activities - continuing operations |
|
$ |
16,173 |
|
|
$ |
27,223 |
|
|
|
|
|
Capital expenditures |
|
|
(4,406 |
) |
|
|
(2,318 |
) |
|
|
|
|
Free cash flow |
|
$ |
11,767 |
|
|
$ |
24,905 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YTD |
|
YTD |
|
Quarter |
||||||
|
|
June 30, 2019 |
|
March 31, 2019 |
|
June 30, 2019 |
||||||
Net cash provided by (used for) operating activities - continuing operations |
|
$ |
16,173 |
|
- |
$ |
5,301 |
|
= |
$ |
10,872 |
|
Capital expenditures |
|
|
(4,406 |
) |
- |
|
(2,933 |
) |
= |
|
(1,473 |
) |
Free cash flow |
|
$ |
11,767 |
|
- |
$ |
2,368 |
|
= |
$ |
9,399 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
YTD |
|
YTD |
|
Quarter |
||||||
|
|
June 30, 2018 |
|
March 31, 2018 |
|
June 30, 2018 |
||||||
Net cash provided by (used for) operating activities - continuing operations |
|
$ |
27,223 |
|
- |
$ |
12,838 |
|
= |
$ |
14,385 |
|
Capital expenditures |
|
|
(2,318 |
) |
- |
|
(1,206 |
) |
= |
|
(1,112 |
) |
Free cash flow |
|
$ |
24,905 |
|
- |
$ |
11,632 |
|
= |
$ |
13,273 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20190730005219/en/
Monica Vinay, Vice President, Investor Relations & Treasurer, (330) 761-6212
Source: Myers Industries, Inc.