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EX-99.1 - EX-99.1 - MYERS INDUSTRIES INCd616903dex991.htm
EX-99.3 - EX-99.3 - MYERS INDUSTRIES INCd616903dex993.htm

Exhibit 99.2

 

LOGO    News Release
   NYSE: MYE

Contact(s):

Gregg Branning, Senior Vice President

& Chief Financial Officer (330) 761-6303

Monica Vinay, Vice President, Investor

Relations & Treasurer (330) 761-6212

Myers Industries Reports 2013 Third Quarter Results

 

    Third quarter diluted adjusted EPS up 25% compared to last year’s third quarter

 

    Third consecutive quarter of year-over-year significant profit improvement by the Lawn and Garden Segment

 

    Strong operating cash flow generation

 

    Expect year-over-year adjusted EPS growth in the fourth quarter of 2013

 

    Private placement note purchase agreement totaling $100 million signed in October

October 24, 2013, Akron, Ohio - Myers Industries, Inc. (NYSE: MYE) today announced results for the third quarter ended September 30, 2013.

Summary

 

     Quarter Ended September 30,     Nine Months Ended September 30,  
     2013     2012     % Increase
(Decrease)
    2013     2012     % Increase
(Decrease)
 
     (Dollars in thousands, except per share data)  

Net sales

   $ 194,920      $ 197,290        (1.2 )%    $ 613,924      $ 577,180        6.4

Gross profit

   $ 53,639      $ 52,729        1.7   $ 167,726      $ 158,091        6.1

Gross profit margin

     27.5     26.7       27.3     27.4  

Income before taxes

   $ 10,963      $ 8,578        27.8   $ 35,118      $ 33,553        4.7

Net Income:

            

Income

   $ 6,488      $ 5,796        11.9   $ 22,683      $ 21,441        5.8

Income per diluted share

   $ 0.19      $ 0.17        11.8   $ 0.67      $ 0.63        6.3

Income before taxes as adjusted*

   $ 13,393      $ 10,997        21.8   $ 39,640      $ 36,888        7.5

Net income as adjusted*:

            

Income

   $ 8,437      $ 6,780        24.4   $ 24,973      $ 22,870        9.2

Income per diluted share

   $ 0.25      $ 0.20        25.0   $ 0.73      $ 0.67        9.0

 

* Details regarding the pre-tax adjusted charges are provided on the Reconciliation of Non-GAAP Financial Measures included in this release.

 

  Net sales in the third quarter of 2013 were $194.9 million compared to $197.3 million in the third quarter of 2012.

 

  The gross profit margin was 27.5% in the third quarter of 2013 compared to 26.7% in the third quarter of 2012. The increase was due mostly to cost savings that resulted from productivity improvements and material substitutions.

 

  Net income per diluted share as adjusted increased 25% to $0.25 in the third quarter of 2013 compared to $0.20 in the third quarter of 2012, reflecting improved performance of the Lawn and Garden Segment and overall cost reductions.


President and Chief Executive Officer John C. Orr said, “Our continued focus on profit improvement delivered a 25% improvement in adjusted diluted earnings per share compared to the same quarter last year. Both the Lawn and Garden and Distribution Segments drove the increased profitability. The Lawn and Garden Segment’s increase in profitability was due primarily to productivity, material substitution and savings from phase one of our restructuring project. We are very pleased with the progress of this segment over the last three quarters.”

Orr continued, “Overall, sales were slightly below our third quarter expectation due to a poor tomato crop harvest impacting our Material Handling Segment’s food processing sales, a delay in orders in our Lawn and Garden Segment to the fourth quarter and the focus on more profitable business in our Engineered Products Segment. However, sales year to date are up 6.4% compared to last year to date. We anticipate year-over-year sales growth in the fourth quarter helped by new product sales.”

Segment Results

The results below are as adjusted and exclude restructuring and other unusual pre-tax charges as detailed on the Reconciliation of Non-GAAP Financial Measures included in this release.

Net sales in the Material Handling Segment for the third quarter of 2013 were $76.0 million compared to $76.2 million for the third quarter of 2012. A sales decrease driven by lower than anticipated food processing sales that resulted from a poor tomato crop season more than offset incremental sales resulting from the Jamco acquisition, which took place in October 2012. Material Handling’s adjusted income before taxes was $10.7 million for the third quarter of 2013 compared to $12.5 million for the third quarter of 2012. The decrease in income before taxes was primarily due to the lower sales volume.

Net sales in the Lawn and Garden Segment for the third quarter of 2013 were $44.9 million compared to $45.3 million for the third quarter of 2012. A delay in customer orders for the upcoming season resulted in slightly lower sales. Lawn and Garden’s adjusted income before taxes for the third quarter of 2013 was $2.5 million compared to break-even income before taxes in the third quarter of 2012. Productivity improvements and raw material substitution cost savings coupled with savings from phase one of our previously announced restructuring project led to the significant improvement in adjusted income before taxes year-over-year.

Net sales in the Distribution Segment were $45.0 million for the third quarter of 2013 compared to $45.1 million for the third quarter of 2012. Distribution’s adjusted income before taxes was $4.3 million for the third quarter of 2013 compared to $3.4 million for the third quarter of 2012. A favorable product mix and lower selling, general and administrative expenses led to the increase in income before taxes year-over-year.

Net sales in the Engineered Products Segment were $33.8 million for the third quarter of 2013 compared to $35.7 million for the third quarter of 2012. The decline in sales year-over-year was due partially to lower custom sales as the segment continues to focus on more profitable customers and products. Engineered Products’ adjusted income before taxes was $3.5 million for the third quarter of 2013 compared to $3.7 million for the third quarter of 2012. The decreased income from the lower sales was substantially offset by raw material cost savings and productivity improvements.

Other Financial Items

For the nine months ended September 30, 2013, cash flow provided by operations was $46.8 million compared to $23.3 million in the nine months ended September 30, 2012, reflecting efforts to better manage working capital.

Capital expenditures totaled $20.0 million for the nine months ended September 30, 2013 and are forecasted to be approximately $35 million for the full year of 2013.

On October 22, 2013, the Company entered into a note purchase agreement for the private placement of senior unsecured notes totaling $100 million with a group of institutional investors. The proceeds will be used to grow key businesses and repay existing debt.


Q4 Outlook

The Company anticipates that fourth quarter results will reflect year-over-year improvement in both sales and adjusted earnings excluding restructuring and other unusual pre-tax charges. Sales of new products, productivity gains, cost savings and the forecasted benefits from the Lawn and Garden Segment restructuring initiatives are expected to produce most of the improvements.

Conference Call Details

The Company will host an earnings conference call and webcast for investors and analysts on Thursday, October 24, 2013 at 10:00 a.m. ET. The call is anticipated to last approximately one hour and may be accessed at (877) 407-8033. Callers are asked to sign on at least five minutes in advance. The call will be available as a webcast through the Company’s web site, 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 a telephone replay, callers should dial: (US) 877-660-6853 or (Int’l) 201-612-7415. The replay passcode is Conference ID #100633.

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 wholesale distributor of tools, equipment and supplies for the tire, wheel and under vehicle service industry in the U.S. Visit www.myersindustries.com to learn more.

Caution on Forward-Looking Statements

Statements in this release may 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”, “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: changes in the markets for the Company’s business segments; changes in trends and demands in the markets in which the Company competes; unanticipated downturn in business relationships with customers or their purchases; competitive pressures on sales and pricing; raw material availability, increases in raw material costs, or other production costs; future economic and financial conditions in the United States and around the world; ability to weather the current economic downturn; 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; the Company’s ability to execute the components of its Strategic Business Evolution process; 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 web site at http://www.sec.gov, and on the Company’s Investor Relations section of its web site at http://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 INCOME (UNAUDITED)

FOR THE QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2013 AND 2012

(Dollars in thousands, except share data)

 

     For the Quarter Ended      For the Nine Months Ended  
     September 30,
2013
     September 30,
2012
     September 30,
2013
     September 30,
2012
 

Net sales

   $ 194,920       $ 197,290       $ 613,924       $ 577,180   

Cost of sales

     141,281         144,561         446,198         419,089   
  

 

 

    

 

 

    

 

 

    

 

 

 

Gross profit

     53,639         52,729         167,726         158,091   

Selling, general and administrative expenses

     41,564         42,957         129,288         121,210   
  

 

 

    

 

 

    

 

 

    

 

 

 

Operating income

     12,075         9,772         38,438         36,881   

Interest expense, net

     1,112         1,194         3,320         3,328   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income before income taxes

     10,963         8,578         35,118         33,553   

Income tax expense

     4,475         2,782         12,435         12,112   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net income

   $ 6,488       $ 5,796       $ 22,683       $ 21,441   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income per common share:

           

Basic

   $ 0.19       $ 0.17       $ 0.68       $ 0.64   

Diluted

   $ 0.19       $ 0.17       $ 0.67       $ 0.63   

Weighted Average Common Shares Outstanding

           

Basic

     33,670,639         33,746,824         33,574,801         33,592,984   

Diluted

     34,208,809         34,411,654         33,991,021         34,256,453   


MYERS INDUSTRIES, INC.

SALES AND EARNINGS BY SEGMENT (UNAUDITED)

(Dollars in thousands)

 

     Quarter Ended September 30,     Nine Months Ended September 30,  
     2013     2012     % Change     2013     2012     % Change  

Net Sales

            

Material Handling

   $ 75,965      $ 76,151        (0.2 )%    $ 239,768      $ 201,632        18.9

Lawn and Garden

     44,905        45,341        (1.0 )%      146,157        147,008        (0.6 )% 

Distribution

     45,006        45,065        (0.1 )%      133,548        131,991        1.2

Engineered Products

     33,839        35,709        (5.2 )%      108,403        111,578        (2.8 )% 

Inter-company Sales

     (4,795     (4,976     —          (13,952     (15,029     —     
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 194,920      $ 197,290        (1.2 )%    $ 613,924      $ 577,180        6.4
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income (Loss)

            

Before Income Taxes

            

Material Handling

   $ 10,679      $ 12,530        (14.8 )%    $ 31,394      $ 34,903        (10.1 )% 

Lawn and Garden

     93        41        126.8     2,265        (683     —     

Distribution

     4,290        3,343        28.3     10,993        11,152        (1.4 )% 

Engineered Products

     3,502        2,921        19.9     13,713        12,172        12.7

Corporate

     (7,601     (10,257     —          (23,247     (23,991     —     
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

   $ 10,963      $ 8,578        27.8   $ 35,118      $ 33,553        4.7
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


MYERS INDUSTRIES, INC.

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

INCOME (LOSS) BEFORE TAXES BY SEGMENT (UNAUDITED)

(Dollars in millions, except per share data)

 

     Quarter Ended     Nine Months Ended  
     September 30     September 30  
     2013     2012     2013     2012  

Material Handling

        

Income before taxes as reported

   $ 10.7      $ 12.5      $ 31.4      $ 34.9   

Restructuring expenses

     0.0        0.0        0.2        0.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes as adjusted

     10.7        12.5        31.6        34.9   

Lawn and Garden

        

Income (loss) before taxes as reported

     0.1        0.0        2.3        (0.7

Restructuring expenses and other adjustments

     1.1        0.0        2.3        0.5   

Loss on disposal of assets

     0.0        0.0        0.6        0.0   

Depreciation recapture

     1.3        0.0        1.3        0.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before taxes as adjusted

     2.5        0.0        6.5        (0.2

Distribution

        

Income before taxes as reported

     4.3        3.3        11.0        11.2   

Restructuring expenses

     0.0        0.2        0.1        0.7   

Gain on building sale

     0.0        (0.1     0.0        (0.4
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes as adjusted

     4.3        3.4        11.1        11.5   

Engineered Products

        

Income before taxes as reported

     3.5        2.9        13.7        12.2   

Restructuring expenses

     0.0        0.8        0.0        1.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes as adjusted

     3.5        3.7        13.7        13.2   

Corporate and interest expense

        

Income (loss) before taxes as reported

     (7.6     (10.1     (23.3     (24.0

Severance and other

     0.0        1.5        0.0        1.5   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income (loss) before taxes as adjusted

     (7.6     (8.6     (23.3     (22.5

Consolidated

        

Income before taxes as reported

     11.0        8.6        35.1        33.6   

Restructuring expenses and other adjustments

     2.4        2.4        4.5        3.3   
  

 

 

   

 

 

   

 

 

   

 

 

 

Income before taxes as adjusted

     13.4        11.0        39.6        36.9   

Income taxes

     5.0        4.2        14.6        14.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net Income as adjusted

   $ 8.4      $ 6.8      $ 25.0      $ 22.9   
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted earnings per diluted share

   $ 0.25      $ 0.20      $ 0.73      $ 0.67   

Note: Numbers in the Corporate and interest expense section above may be rounded for presentation purposes.

Note on Reconciliation of Income and Earnings Data: Income (loss) excluding the items mentioned above in the text of this release and in this reconciliation chart is a non-GAAP financial measure that Myers Industries, Inc. calculates according to the schedule above, using GAAP amounts from the unaudited Consolidated Financial Statements. The Company believes that the excluded items are not primarily related to core operational activities. The Company believes that income (loss) excluding items that are not primarily related to core operating activities is generally viewed as providing useful information regarding a company’s operating profitability. Management uses income (loss) excluding these items as well as other financial measures in connection with its decision-making activities. Income (loss) excluding these items should not be considered in isolation or as a substitute for net income (loss), income (loss) before taxes or other consolidated income data prepared in accordance with GAAP. The Company’s method for calculating income (loss) excluding these items may not be comparable to methods used by other companies.


MYERS INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (UNAUDITED)

(Dollars in thousands)

 

     September 30,
2013
     December 31,
2012
 

Assets

     

Current Assets

     

Cash

   $ 7,004       $ 3,948   

Accounts receivable, net

     108,279         115,508   

Inventories

     117,920         107,502   

Other

     11,564         12,638   
  

 

 

    

 

 

 

Total Current Assets

     244,767         239,596   

Other Assets

     86,892         94,777   

Property, Plant, & Equipment, Net

     147,745         150,483   
  

 

 

    

 

 

 

Total Assets

   $ 479,404       $ 484,856   
  

 

 

    

 

 

 

Liabilities & Shareholders’ Equity

     

Current Liabilities

     

Accounts payable

   $ 69,578       $ 72,417   

Accrued expenses

     44,624         42,060   
  

 

 

    

 

 

 

Total Current Liabilities

     114,202         114,477   

Long-term debt

     75,490         92,814   

Other liabilities

     17,537         17,865   

Deferred income taxes

     31,920         29,678   

Total Shareholders’ Equity

     240,255         230,022   
  

 

 

    

 

 

 

Total Liabilities & Shareholders’ Equity

   $ 479,404       $ 484,856   
  

 

 

    

 

 

 


MYERS INDUSTRIES, INC.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2013 AND 2012

(Dollars in thousands)

 

     September 30,
2013
    September 30,
2012
 

Cash Flows From Operating Activities

    

Net income

   $ 22,683      $ 21,441   

Items not affecting use of cash

    

Depreciation

     25,661        22,287   

Amortization of intangible assets

     2,953        2,331   

Non-cash stock compensation

     2,142        2,134   

Provision for (recovery of) loss on accounts receivable

     698        (1,019

Deferred taxes

     4,069        428   

Other long-term liabilities

     38        2,037   

Loss (gain) from asset disposition

     584        (628

Other

     202        50   

Cash flow provided by (used for) working capital, net of acquisitions:

    

Accounts receivable

     3,908        664   

Inventories

     (12,443     (18,611

Prepaid expenses

     (1,509     (2,563

Accounts payable and accrued expenses

     (2,143     (4,877
  

 

 

   

 

 

 

Net cash provided by operating activities

     46,843        23,341   
  

 

 

   

 

 

 

Cash Flows From Investing Activities

    

Capital expenditures

     (20,003     (15,236

Acquisition of business, net of cash acquired

     (600     (3,430

Proceeds from sale of property, plant and equipment

     928        1,975   

Other

     (64     100   
  

 

 

   

 

 

 

Net cash used for investing activities

     (19,739     (16,591
  

 

 

   

 

 

 

Cash Flows From Financing Activities

    

Repayment of long-term debt

     —          (26,333

Net (repayments of) borrowing on credit facility

     (17,324     20,410   

Cash dividends paid

     (6,046     (7,642

Proceeds from issuance of common stock

     5,765        3,026   

Tax benefit from options

     167        —     

Repurchase of common stock

     (5,955     —     
  

 

 

   

 

 

 

Net cash used for financing activities

     (23,393     (10,539
  

 

 

   

 

 

 

Foreign Exchange Rate Effect on Cash

     (655     3,456   
  

 

 

   

 

 

 

Net increase (decrease) in cash

     3,056        (333

Cash at January 1

     3,948        6,801   
  

 

 

   

 

 

 

Cash at September 30

   $ 7,004      $ 6,468