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Press release from Business Wire

Myers Industries Reports Third Quarter 2012 Results

<p class='bwalignc'> <i>Diluted EPS $0.17 compared with $0.21 in 3Q 2011</i> </p> <p class='bwalignc'> <i>Adjusted EPS $0.20 compared with $0.14 in 3Q 2011</i> </p> <p class='bwalignc'> <i>Gross margin increased to 26.7% versus 25.1% for 3Q 2011</i> </p> <p class='bwalignc'> <i>Recently announced acquisition of Jamco Products Inc. in Material Handling Segment</i> </p>

Thursday, October 18, 2012

Myers Industries Reports Third Quarter 2012 Results07:30 EDT Thursday, October 18, 2012 AKRON, Ohio (Business Wire) -- Myers Industries, Inc. (NYSE: MYE) today announced results for the third quarter ended September 30, 2012. Net sales for the third quarter were $197.3 million compared with $190.3 million in the third quarter of 2011. Strong sales performance in the Engineered Products Segment combined with a sales increase in the Material Handling Segment more than offset a sales decrease in the Distribution Segment. Gross margin expanded to 26.7% in the third quarter of 2012 compared to 25.1% in the third quarter of 2011. The increase in gross margin was the result of lower manufacturing costs and improved productivity during the quarter. Net income in the third quarter of 2012 was $5.8 million, or $0.17 per diluted share, compared to net income of $7.2 million, or $0.21 per diluted share, in the third quarter of 2011. Net income in the third quarter of 2012 included approximately $2.4 million of special net pre-tax costs while net income in the third quarter of 2011 included approximately $2.0 million of special pre-tax costs. Details regarding the special pre-tax costs for both quarters are provided on the Reconciliation of Non-GAAP Financial Measures included in this release. Net income in the third quarter of 2011 also included net favorable income tax adjustments of approximately $3.8 million for discreet items. Earnings per diluted share as adjusted for the special items and the net favorable tax adjustments were $0.20 in the third quarter of 2012 compared to $0.14 in the third quarter of 2011. President and Chief Executive Officer John C. Orr said, “Despite current market challenges, we are encouraged by our financial performance for the third quarter of 2012. Our income before taxes improved 43.1% over last year's third quarter. This was due to a strong performance in Material Handling, including our Brazil-based Novel acquisition. We had improved results versus last year in Lawn & Garden as well. We expect that both our fourth quarter and full year performance will show improved results compared to last year. On October 2nd, we announced that we acquired Jamco Products Inc., a leading designer and manufacturer of heavy-duty industrial steel carts and safety cabinets. This acquisition further expands our Material Handling business, specifically in storage and safety products, which we have identified as a key growth platform." Segment Results The results below are as adjusted and exclude special pre-tax costs as detailed on the Reconciliation of Non-GAAP Financial Measures included in this release. The Material Handling Segment's net sales in the third quarter of 2012 were $76.2 million compared to $72.1 million in the third quarter of 2011. Sales generated from the acquisition of Plasticos Novel Do Nordeste S.A. ® in July more than offset lower year-over-year sales for the balance of the segment due to a delay in shipments resulting from a shift in customer demand to the fourth quarter. Material Handling's income before taxes was $12.5 million in the third quarter of 2012 compared to $8.9 million in the third quarter of 2011. The increase was primarily the result of improved productivity and lower manufacturing costs. The Lawn & Garden Segment's net sales in the third quarter of 2012 were $45.3 million compared to $45.8 million in the third quarter of 2011. Lawn & Garden reported break-even income before taxes in the third quarter of 2012 compared to a loss of $1.4 million in the third quarter of 2011. By driving productivity improvements, material substitution cost savings and lower distribution costs, the segment was able to improve income before taxes despite flat sales year-over-year. The Distribution Segment's net saleswere $45.1 million in the third quarter of 2012 compared to $48.8 million in the third quarter of 2011. A decline in the replacement tire industry combined with lower equipment sales led to the decrease in sales year-over-year. Distribution's adjusted income before taxes was $3.4 million in the third quarter of 2012 compared to $4.6 million in the third quarter of 2011. The lower sales volume during the quarter led to the decrease in income before taxes. The Engineered Products Segment's net sales were $35.7 million in the third quarter of 2012 compared to $29.4 million in the third quarter of 2011. Strong sales across all end markets generated the 22% increase in sales year-over-year. Engineered Products' adjusted income before taxes was $3.7 million in the third quarter of 2012 compared to $3.1 million in the third quarter of 2011. The increased sales during the quarter was the primary reason for the higher income before taxes year-over-year. Other Financial Items Capital expenditures totaled $15.2 million for the nine months ended September 30, 2012 and are forecasted to be approximately $27 million to $30 million in 2012. At September 30, 2012, debt, net of cash, was $90.2 million compared to $67.2 million at December 31, 2011. During the third quarter of 2011, the Company recognized net favorable income tax adjustments of approximately $3.8 million that were largely the result of realizing previously reserved tax benefits due to the expiration of the statute of limitations for items relating to the sale of one of our subsidiaries in 2007, and other tax adjustments. Subsequent Event The Company acquired Jamco Products Inc., a leading producer of heavy-duty industrial steel carts and safety cabinets. Jamco's manufacturing facilities are located in South Beloit, Illinois. Jamco became part of the Material Handling Segment effective October 1, 2012. Visit www.jamcoproducts.com to learn more. Fourth Quarter and Full Year 2012 Outlook The Company anticipates that despite a relatively weak industrial market, fourth quarter results will benefit from some shifting of Material Handling orders from earlier this year to the fourth quarter, and from continued strengthening in Lawn & Garden compared with last year. However, the decline in the replacement tire industry and the return of transplant automotive from elevated demand trends to more normal demand trends may offset some of those benefits. The Company expects that both fourth quarter and full year performance will reflect improved results compared to 2011. Conference Call Details The Company will host an earnings conference call and webcast for investors and analysts on Thursday, October 18, 2012 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 # 401443. 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 undervehicle service industry in the U.S. The Company reported net sales from continuing operations of $755.7 million in 2011. 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 THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2012 AND 2011(Dollars in thousands, except share data)         For The Three Months EndedFor the Nine Months EndedSeptember 30, 2012September 30, 2011September 30, 2012September 30, 2011   Net sales $ 197,290 $ 190,332 $ 577,180 $ 563,105 Cost of sales 144,561   142,543   419,089   416,732 Gross profit 52,729 47,789 158,091 146,373 Selling, general and administrative expenses 42,957   40,530   121,210   118,072 Operating income 9,772 7,259 36,881 28,301 Interest expense, net 1,194   1,264   3,328   3,655 Income before income taxes 8,578 5,995 33,553 24,646 Income tax expense (benefit) 2,782   (1,219 ) 12,112   6,055 Net income $ 5,796 $ 7,214 $ 21,441 $ 18,591   Income per common share: Basic $ 0.17 $ 0.21 $ 0.64 $ 0.53 Diluted $ 0.17 $ 0.21 $ 0.63 $ 0.53   Weighted Average Common Shares Outstanding Basic 33,746,824 34,354,210 33,592,984 34,938,806 Diluted 34,411,654 34,460,952 34,256,453 35,028,413     MYERS INDUSTRIES, INC.SALES AND EARNINGS BY SEGMENT (UNAUDITED)(Dollars in thousands)             Third Quarter Ended September 30,Nine Months Ended September 30,2012   2011   % Change2012   2011   % Change   Net Sales Material Handling $ 76,151 $ 72,070 5.7 % $ 201,632 $ 204,808 (1.6 )% Lawn and Garden 45,341 45,839 (1.1 )% 147,008 154,812 (5.0 )% Distribution 45,065 48,785 (7.6 )% 131,991 136,511 (3.3 )% Engineered Products 35,709 29,360 21.6 % 111,578 85,182 31.0 % Inter-company Sales (4,976 )   (5,722 )   --- (15,029 )   (18,208 )   --- Total$197,290     $190,332     3.7%$577,180     $563,105     2.5%     Income (Loss)Before Income Taxes Material Handling $ 12,530 $ 8,870 41.3 % $ 34,903 $ 27,526 26.8 % Lawn and Garden 41 (1,413 ) --- (683 ) 846 --- Distribution 3,343 4,564 (26.8 )% 11,152 11,651 (4.3 )% Engineered Products 2,921 3,001 (2.7 )% 12,172 8,381 45.2 % Corporate (10,257 )   (9,027 )   --- (23,991 )   (23,758 )   --- Total$8,578     $5,995     43.1%$33,553     $24,646     36.1%     MYERS INDUSTRIES, INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURESINCOME (LOSS) BEFORE TAXES BY SEGMENT (UNAUDITED)(Dollars in millions)         Quarter EndedNine Months EndedSeptember 30,September 30,2012201120122011Material Handling Income before taxes as reported $ 12.5 $ 8.9 $ 34.9 $ 27.5 Income before taxes as adjusted 12.5 8.9 34.9 27.5   Lawn & Garden Income (loss) before taxes as reported 0.0 (1.4 ) (0.7 ) 0.8 Restructuring expenses 0.0   0.0   0.5   0.1   Income (loss) before taxes as adjusted 0.0 (1.4 ) (0.2 ) 0.9   Distribution Income before taxes as reported 3.3 4.6 11.2 11.7 Restructuring expenses 0.2 0.5 0.7 1.2 Gain on building sale (0.1 ) (0.5 ) (0.4 ) (0.5 ) Income before taxes as adjusted 3.4 4.6 11.5 12.4   Engineered Products Income before taxes as reported 2.9 3.0 12.2 8.4 Restructuring expenses 0.8   0.1   1.0   0.2   Income before taxes as adjusted 3.7 3.1 13.2 8.6   Corporate and interest expense Income (loss) before taxes as reported (10.3 ) (9.1 ) (24.0 ) (23.8 ) Severance and other 1.5 0.0 1.5 0.3 Environmental 0.0   1.9   0.0   1.9   Income (loss) before taxes as adjusted (8.8 ) (7.2 ) (22.5 ) (21.6 )   Consolidated Income before taxes as reported 8.4 6.0 33.6 24.6 Restructuring expenses and other adjustments 2.4   2.0   3.3   3.2   Income before taxes as adjusted 10.8 8.0 36.9 27.8 Income taxes at 38% 4.1   3.0   14.0   10.6   Net Income (loss) as adjusted $ 6.7   $ 5.0   $ 22.9   $ 17.2     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 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, 2012December 31, 2011Assets Current Assets Cash $ 6,468 $ 6,801 Accounts receivable, net 111,967 105,830 Inventories 120,472 95,217 Other 14,814   10,604 Total Current Assets 253,721 218,452 Other Assets 82,700 69,371 Property, Plant, & Equipment, Net 145,704   140,934 Total Assets $ 482,125   $ 428,757     Liabilities & Shareholder's Equity Current Liabilities Accounts payable $ 68,313 $ 64,717 Accrued expenses 43,926 45,634 Current portion of long-term debt 305   305 Total Current Liabilities 112,544 110,656 Long-term debt, less current portion 96,380 73,725 Other liabilities 16,041 14,343 Deferred income taxes 28,070 23,893 Shareholders' Equity 229,090   206,140 Total Liabilities & Shareholder's Equity $ 482,125   $ 428,757     MYERS INDUSTRIES, INC.CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2012 AND 2011(Dollars in thousands)     September 30, 2012September 30, 2011Cash Flows From Operating Activities Net income $ 21,441 $ 18,591   Adjustments to reconcile net income to net cash provided by operating activities Depreciation 22,287 24,102 Impairment charges and asset write-offs 0 814 Amortization of intangible assets 2,331 2,210 Non-cash stock compensation 2,134 2,151 Payments for long-term incentive compensation (333 ) 0 (Recovery of) provision for loss on accounts receivable (1,019 ) 1,179 Deferred taxes 428 635 Other long-term liabilities 2,037 3,015 Gain on sale of property, plant and equipment (628 ) (591 ) Other 50 50 Cash flow provided by (used for) working capital: Accounts receivable 664 (5,024 ) Inventories (18,611 ) (8,759 ) Prepaid expenses (2,563 ) 2,294 Accounts payable and accrued expenses (4,877 ) (422 ) Net cash provided by operating activities 23,341   40,245     Cash Flows From Investing Activities Capital expenditures (15,236 ) (13,337 ) Acquisition of business, net of cash acquired (3,430 ) (1,100 ) Proceeds from sale of property, plant and equipment 1,975 1,082 Other 100   (92 ) Net cash used for investing activities (16,591 ) (13,447 )   Cash Flows From Financing Activities Repayment of long term debt (26,333 ) (305 ) Net borrowing on credit facility 20,410 (2,907 ) Cash dividends paid (7,642 ) (7,163 ) Proceeds from issuance of common stock 3,026 173 Repurchase of common stock 0   (18,821 ) Net cash used for financing activities (10,539 ) (29,023 )   Foreign Exchange Rate Effect on Cash 3,456   371     Net (decrease) increase in cash (333 ) (1,854 ) Cash at January 1 6,801   4,705   Cash at September 30 $ 6,468   $ 2,851     Myers Industries, Inc.Gregg Branning, 330-761-6303Senior Vice President & Chief Financial OfficerorMonica Vinay, 330-761-6212Director, Investor & Financial Relations