(NewsDirect)
Cooper-StandardHoldings Inc. (NYSE: CPS) today reported results for the fourthquarter and full year 2021.
FourthQuarter Highlights
- Salesof $601.3 million increased sequentially by 14% compared to thirdquarter 2021
- Net loss of $102.2 million or $(5.98) perfully diluted share, improved sequentially by 17% compared to thirdquarter 2021
- Adjusted net loss of $50.3 million, or$(2.94) per fully diluted share, improved sequentially by 53% comparedto third quarter 2021
- Adjusted EBITDA of $2.0 millionincreased sequentially by $35.9 million as compared to third quarter2021
- Year-end cash balance of $248 million; continuingstrong total liquidity of $396 million
“We were pleased tosee OEM production schedules begin to stabilize and volumes improveduring the fourth quarter, compared to what we saw in the second andthird quarters of 2021,” said Jeffrey Edwards, chairman and CEO,Cooper Standard. “Headwinds from increased material and labor costsremain and we have made progress in our negotiations to recover someof those increases in 2022. Our outlook anticipates furtherimprovement in production volumes throughout the year, especially inthe second half, which we expect will enable us to drive improvedmargins and cash flow going forward.”
Consolidated Results
| Quarter Ended December 31, |
| Year EndedDecember 31, | ||||
| 2021 |
| 2020 |
| 2021 |
| 2020 |
| (Dollar amounts in millions except pershare amounts) | ||||||
| Unaudited |
| Unaudited |
| Unaudited |
|
|
Sales | $ 601.3 |
| $ 696.9 |
| $ 2,330.2 |
| $ 2,375.4 |
Netloss | $ (102.2) |
| $ (27.2) |
| $ (322.8) |
| $ (267.6) |
Adjusted net (loss)income | $ (50.3) |
| $ 3.3 |
| $(222.3) |
| $(141.4) |
Loss perdiluted share | $ (5.98) |
| $(1.61) |
| $(18.94) |
| $(15.82) |
Adjusted(loss) earnings per diluted share | $(2.94) |
| $ 0.19 |
| $(13.04) |
| $(8.36) |
AdjustedEBITDA | $ 2.0 |
| $ 57.0 |
| $(8.0) |
| $ 35.7 |
The year-over-year decline in fourth quarter sales wasprimarily attributable to unfavorable volume and mix associated withcontinuing supply chain constraints, partially offset by favorableprice adjustments. The year-over-year change in fourth quarter netloss was driven primarily by unfavorable volume and mix, highermaterial costs, higher wages and general inflation, and higher incometax expense, partially offset by favorable price adjustments and lowerselling, administrative and engineering (SGA&E) expense. Theyear-over-year change in fourth quarter adjusted EBITDA was drivenprimarily by unfavorable volume and mix, higher material costs, andhigher wages and general inflation, partially offset by favorableprice adjustments and lower SGA&E expense.
For the full year 2021,sales declined primarily due to the divestiture of certain businessoperations in Europe and India in 2020 and unfavorable volume and mix,partially offset by favorable foreign exchange. The year-over-yearchange in full year net loss was primarily driven by higher materialcosts, higher wages and general inflation, unfavorable volume and mix,higher interest expense and higher income tax expense. These negativeimpacts were partially offset by lower SGA&E expense, improvementsin operating efficiency, and other cost reduction initiatives. Fullyear adjusted EBITDA declined due primarily to higher material costs,higher wages and general inflation, and unfavorable volume and mix,partially offset by lower SGA&E expense, improvements in operatingefficiency, and other cost reduction initiatives.
Adjusted net income(loss), adjusted EBITDA, adjusted earnings (loss) per diluted shareand free cash flow are non-GAAP measures. Reconciliations to the mostdirectly comparable financial measures, calculated and presented inaccordance with accounting principles generally accepted in the UnitedStates (“U.S. GAAP”), are provided in the attached supplementalschedules.
NewBusiness Awards
Electric vehicle trends continue to create opportunity forCooper Standard. During the fourth quarter of 2021, the Companyreceived net new business awards representing approximately $26million in incremental anticipated future annualized sales.Approximately $18 million of these net new business awards were onelectric vehicle platforms. For the full year 2021, the Company'snet new business awards totaled approximately $186 million, including$106 million in new awards on electric vehicle platforms. The Companybelieves its world-class engineering and manufacturing capabilities,its innovation programs and its reputation for quality and service arecompetitive advantages that continue to drive the new businessawards.
Continuing Execution of Cost Reduction and StrategicInitiatives
The Company remains focused on reducing ongoing costs throughimproved operating efficiency and further rightsizing of its operatingfootprint, overhead expenses and staffing levels. In 2021, theseinitiatives resulted in a combined cost savings of approximately $81million. Further restructuring actions and other cost savingsinitiatives are anticipated in 2022.
Quarterly Segment Results
Sales
| ThreeMonths Ended December 31, |
|
| VarianceDue To: | ||||||
| 2021 |
| 2020 |
| Change |
|
| Volume /Mix * |
| ForeignExchange |
| (Dollar amounts inthousands) | |||||||||
Sales toexternal customers | Unaudited |
| Unaudited |
|
|
|
|
|
|
|
North America | $ 291,104 |
| $ 321,223 |
| $(30,119) |
|
| $ (30,676) |
| $ 557 |
Europe | 121,166 |
| 176,663 |
| (55,497) |
|
| (50,442) |
| (5,055) |
Asia Pacific | 130,640 |
| 151,909 |
| (21,269) |
|
| (23,929) |
| 2,660 |
South America | 16,093 |
| 18,822 |
| (2,729) |
|
| (2,174) |
| (555) |
TotalAutomotive | 559,003 |
| 668,617 |
| (109,614) |
|
| (107,221) |
| (2,393) |
Corporate, eliminationsand other | 42,346 |
| 28,265 |
| 14,081 |
|
| 14,427 |
| (346) |
Consolidated | $ 601,349 |
| $ 696,882 |
| $(95,533) |
|
| $(92,794) |
| $(2,739) |
* Net of customer price adjustments
- Volume and mix, net of customer priceadjustments, was mainly driven by the decline in vehicle productionvolume caused by the impact of semiconductor and other OEM supplychain issues.
- The impact of foreign currency exchange wasprimarily related to the Euro, the Chinese Renminbi and the BrazilianReal.
AdjustedEBITDA
| Three Months Ended December 31, |
|
| Variance Due To: | ||||||||
| 2021 |
| 2020 |
| Change |
|
| Volume /Mix * |
| ForeignExchange |
| Cost Decreases /(Increases) |
| (Dollar amounts inthousands) | |||||||||||
Segment adjustedEBITDA | Unaudited |
| Unaudited |
|
|
|
|
|
|
|
|
|
North America | 3,810 |
| 38,378 |
| (34,568) |
|
| (8,015) |
| (3,712) |
| (22,841) |
Europe | (8,607) |
| 8,488 |
| (17,095) |
|
| (14,374) |
| (312) |
| (2,409) |
Asia Pacific | (3,732) |
| 19,455 |
| (23,187) |
|
| (3,521) |
| (504) |
| (19,162) |
South America | (3,096) |
| (2,233) |
| (863) |
|
| (899) |
| (364) |
| 400 |
TotalAutomotive | (11,625) |
| 64,088 |
| (75,713) |
|
| (26,809) |
| (4,892) |
| (44,012) |
Corporate, eliminationsand other | 13,636 |
| (7,072) |
| 20,708 |
|
| 12,294 |
| (432) |
| 8,846 |
Consolidated adjustedEBITDA | 2,011 |
| 57,016 |
| (55,005) |
|
| (14,515) |
| (5,324) |
| (35,166) |
* Net of customer priceadjustments
- Volume and mix, netof customer price adjustments, was mainly driven by the decline invehicle production volume caused by the impact of semiconductor andother OEM supply chain issues.
- Foreign currency exchange wasprimarily related to the Mexican Peso and the CanadianDollar.
-
The Cost Decreases /(Increases) category above includes:
-
The increase in materialcosts, wages, and general inflation
-
Lower SGA&E expense, savings from pastrestructuring actions and savings from manufacturingefficiencies.
-
Full Year Segment Results
Sales
| Year EndedDecember 31, |
|
| Variance DueTo: | ||||||||
| 2021 |
| 2020 |
| Change |
|
| Volume /Mix * |
| ForeignExchange |
| Divestitures /Other |
| (Dollar amounts inthousands) | |||||||||||
Sales toexternal customers | Unaudited |
|
|
|
|
|
|
|
|
|
|
|
North America | $ 1,148,257 |
| $ 1,141,368 |
| $ 6,889 |
|
| $ 2,118 |
| $ 4,771 |
| $ — |
Europe | 518,245 |
| 586,739 |
| (68,494) |
|
| (40,454) |
| 21,177 |
| (49,217) |
Asia Pacific | 458,306 |
| 468,042 |
| (9,736) |
|
| (20,362) |
| 25,917 |
| (15,291) |
South America | 61,713 |
| 60,754 |
| 959 |
|
| 4,425 |
| (3,466) |
| — |
TotalAutomotive | 2,186,521 |
| 2,256,903 |
| (70,382) |
|
| (54,273) |
| 48,399 |
| (64,508) |
Corporate, eliminationsand other | 143,670 |
| 118,536 |
| 25,134 |
|
| 23,351 |
| 1,783 |
| — |
Consolidated | $ 2,330,191 |
| $2,375,439 |
| $(45,248) |
|
| $(30,922) |
| $ 50,182 |
| $ (64,508) |
* Net ofcustomer price adjustments
- Volume and mix, net of customer priceadjustments, was driven by the decline in vehicle production volumecaused by the impact of semiconductor and other OEM supply chainissues.
- The impact of foreign currency exchange was primarilyrelated to the Euro and the Brazilian Real.
AdjustedEBITDA
| Year Ended December 31, |
|
| Variance DueTo: | ||||||||||
| 2021 |
| 2020 |
| Change |
|
| Volume /Mix * |
| ForeignExchange |
| Cost Decreases /(Increases) |
| Divestitures /Other |
| (Dollar amounts inthousands) | |||||||||||||
Segment adjustedEBITDA | Unaudited |
|
|
|
|
|
|
|
|
|
|
|
|
|
NorthAmerica | 54,616 |
| 90,638 |
| (36,022) |
|
| 3,668 |
| (10,550) |
| (28,641) |
| (499) |
Europe | (49,599) |
| (39,004) |
| (10,595) |
|
| (15,306) |
| (1,717) |
| 4,078 |
| 2,350 |
Asia Pacific | (16,756) |
| 12,472 |
| (29,228) |
|
| (13,154) |
| (7) |
| (23,106) |
| 7,039 |
South America | (9,852) |
| (13,841) |
| 3,989 |
|
| 3,361 |
| 4,293 |
| (3,665) |
| — |
TotalAutomotive | (21,591) |
| 50,265 |
| (71,856) |
|
| (21,431) |
| (7,981) |
| (51,334) |
| 8,890 |
Corporate, eliminationsand other | 13,557 |
| (14,588) |
| 28,145 |
|
| 14,476 |
| (46) |
| 13,715 |
| — |
Consolidatedadjusted EBITDA | (8,034) |
| 35,677 |
| (43,711) |
|
| (6,955) |
| (8,027) |
| (37,619) |
| 8,890 |
* Net of customer price adjustments
- Volume and mix, netof customer price adjustments, was driven by the decline in vehicleproduction volume caused by the impact of semiconductor and other OEMsupply chain issues.
- Foreign currency exchange was impactedby the Mexican Peso, Canadian Dollar, Euro, Polish Zloty, CzechKoruna, Chinese Renminbi and the Brazilian Real.
-
The CostDecreases / (Increases) category above includes:
-
The one-time impact of an $11.2million credit loss for certain accounts receivable related to thebankruptcy proceedings of a former joint venture in Asia;
-
Commodity cost, wage and allowance for credit lossincreases;
-
The non-recurrence of prior year governmentincentives primarily related to the COVID-19 pandemic;
-
Reduction in compensation-related expenses, due tosalaried headcount initiatives, purchasing savings through leaninitiatives, variable employee compensation expenses, andrestructuring savings; and
- Net manufacturing efficienciesof $33 million, primarily driven by our European, North America andAsia Pacific segments.
-
Cash andLiquidity
Asof December 31, 2021, Cooper Standard had cash and cash equivalentstotaling $248.0 million and total liquidity, including availabilityunder its amended senior asset-based revolving credit facility, of$395.5 million. Based on our current expectations for light vehicleproduction and customer demand for our products, we expect our currentsolid cash balance and access to flexible credit facilities willprovide sufficient resources to support ongoing operations and theexecution of planned strategic initiatives.
Outlook
Based on our outlook for the globalautomotive industry, macroeconomic conditions, current customerproduction schedules and our own operating plans, the Company hasissued 2022 full year guidance as follows:
| Initial 2022Guidance 1 |
Sales | $2.6 - $2.8 billion |
Adjusted EBITDA 2 | $50 - $60 million |
CapitalExpenditures | $90 - $100 million |
Cash Restructuring | $20 - $30 million |
Net Cash Taxes /(Refund) | $(30) - $(40)million |
Key Light Vehicle ProductionsAssumptions |
|
NorthAmerica | 15.2 million |
Europe | 18.5 million |
Greater China | 24.7 million |
1 Guidance isrepresentative of management's estimates and expectations as ofthe date it is published. Current guidance as presented in this pressrelease considers January 2022 IHS Markit production forecasts forrelevant light vehicle platforms and models, customers' plannedproduction schedules and other internal assumptions.
2 AdjustedEBITDA is a non-GAAP financial measure. The Company has not provided areconciliation of projected adjusted EBITDA to projected net incomebecause full-year net income will include special items that have notyet occurred and are difficult to predict with reasonable certaintyprior to year-end. Due to this uncertainty, the Company cannotreconcile projected adjusted EBITDA to U.S. GAAP net income withoutunreasonable effort.
Conference Call Details
Cooper Standard management will host a conferencecall and webcast on February 18, 2022 at 9 a.m. ET to discuss itsfourth quarter and full year 2021 results, provide a general businessupdate and respond to investor questions. A link to the live webcastof the call (listen only) and presentation materials will be availableon Cooper Standard’s Investor Relations website atwww.ir.cooperstandard.com/events.com.
To participate by phone, callers in the UnitedStates and Canada should dial toll-free (877) 374-4041. Internationalcallers should dial (253) 237-1156. Provide the conference ID 7481647or ask to be connected to the Cooper Standard conference call.Representatives of the investment community will have the opportunityto ask questions after the presentation. Callers should dial in atleast five minutes prior to the start of the call.
About CooperStandard
Cooper Standard, headquartered in Northville, Mich., withlocations in 21 countries, is a leading global supplier of sealing andfluid handling systems and components. Utilizing our materials scienceand manufacturing expertise, we create innovative and sustainableengineered solutions for diverse transportation and industrialmarkets. Cooper Standard's approximately 22,600 employees are atthe heart of our success, continuously improving our business andsurrounding communities. Learn more at www.cooperstandard.com orfollow us on Twitter @CooperStandard.
Forward-Looking Statements
This press releaseincludes “forward-looking statements” within the meaning of U.S.federal securities laws, and we intend that such forward-lookingstatements be subject to the safe harbor created thereby. Our use ofwords “estimate,” “expect,” “anticipate,” “project,”“plan,” “intend,” “believe,” “outlook,”“guidance,” “forecast,” or future or conditional verbs, suchas “will,” “should,” “could,” “would,” or “may,”and variations of such words or similar expressions are intended toidentify forward-looking statements. All forward-looking statementsare based upon our current expectations and various assumptions. Ourexpectations, beliefs, and projections are expressed in good faith andwe believe there is a reasonable basis for them. However, we cannotassure you that these expectations, beliefs and projections will beachieved. Forward-looking statements are not guarantees of futureperformance and are subject to significant risks and uncertaintiesthat may cause actual results or achievements to be materiallydifferent from the future results or achievements expressed or impliedby the forward-looking statements. Among other items, such factors mayinclude: the impact, and expected continued impact, of the COVID-19outbreak on our financial condition and results of operations;significant risks to our liquidity presented by the COVID-19 pandemicrisk; prolonged or material contractions in automotive sales andproduction volumes; our inability to realize sales represented byawarded business; escalating pricing pressures; loss of largecustomers or significant platforms; our ability to successfullycompete in the automotive parts industry; availability and increasingvolatility in costs of manufactured components and raw materials;disruption in our supply base; competitive threats and commercialrisks associated with our diversification strategy through ourAdvanced Technology Group; possible variability of our working capitalrequirements; risks associated with our international operations,including changes in laws, regulations, and policies governing theterms of foreign trade such as increased trade restrictions andtariffs; foreign currency exchange rate fluctuations; our ability tocontrol the operations of our joint ventures for our sole benefit; oursubstantial amount of indebtedness and variable rates of interest; ourability to obtain adequate financing sources in the future; operatingand financial restrictions imposed on us under our debt instruments;the underfunding of our pension plans; significant changes in discountrates and the actual return on pension assets; effectiveness ofcontinuous improvement programs and other cost savings plans;manufacturing facility closings or consolidation; our ability toexecute new program launches; our ability to meet customers’ needsfor new and improved products; the possibility that our acquisitionsand divestitures may not be successful; product liability, warrantyand recall claims brought against us; laws and regulations, includingenvironmental, health and safety laws and regulations; legal andregulatory proceedings, claims or investigations against us; workstoppages or other labor disruptions; the ability of our intellectualproperty to withstand legal challenges; cyber-attacks, data privacyconcerns, other disruptions in, or the inability to implement upgradesto, our information technology systems; the possible volatility of ourannual effective tax rate; the possibility of a failure to maintaineffective controls and procedures; the possibility of futureimpairment charges to our goodwill and long-lived assets; our abilityto identify, attract, develop and retain a skilled, engaged anddiverse workforce; our ability to procure insurance at reasonablerates; and our dependence on our subsidiaries for cash to satisfy ourobligations; and other risks and uncertainties, including thosedetailed from time to time in the Company’s periodic reports filedwith the Securities and Exchange Commission.
You should not placeundue reliance on these forward-looking statements. Ourforward-looking statements speak only as of the date of this pressrelease and we undertake no obligation to publicly update or otherwiserevise any forward-looking statement, whether as a result of newinformation, future events or otherwise, except where we are expresslyrequired to do so by law.
This press release also contains estimates and otherinformation that is based on industry publications, surveys andforecasts. This information involves a number of assumptions andlimitations, and we have not independently verified the accuracy orcompleteness of the information.
CPS_F
Financialstatements and related notes follow:
COOPER-STANDARDHOLDINGS INC. | |||||||
CONSOLIDATED STATEMENTS OFOPERATIONS | |||||||
(Dollar amounts in thousands except share and pershare amounts) | |||||||
|
|
|
|
|
|
|
|
| Quarter Ended December 31, |
| Year EndedDecember 31, | ||||
| 2021 |
| 2020 |
| 2021 |
| 2020 |
| (Unaudited) |
| (Unaudited) |
| (Unaudited) |
|
|
Sales | $ 601,349 |
| $ 696,882 |
| $ 2,330,191 |
| $ 2,375,439 |
Cost of productssold | 573,353 |
| 616,593 |
| 2,242,963 |
| 2,227,892 |
Grossprofit | 27,996 |
| 80,289 |
| 87,228 |
| 147,547 |
Selling, administration &engineering expenses | 58,604 |
| 64,610 |
| 227,110 |
| 263,611 |
Gain on sale of business,net | — |
| (520) |
| (696) |
| (2,834) |
Amortization of intangibles | 1,823 |
| 1,979 |
| 7,347 |
| 11,611 |
Impairment charges | 23,762 |
| 16,653 |
| 25,609 |
| 104,363 |
Restructuring charges | 2,699 |
| 16,246 |
| 36,950 |
| 39,482 |
Operating (loss)profit | (58,892) |
| (18,679) |
| (209,092) |
| (268,686) |
Interest expense, net of interestincome | (18,359) |
| (18,174) |
| (72,511) |
| (59,167) |
Equity in (losses) earnings ofaffiliates | (1,793) |
| 1,238 |
| (1,728) |
| 396 |
Pension settlementcharges | (1,279) |
| (184) |
| (1,279) |
| (184) |
Other (expense) income,net | (621) |
| 2,777 |
| (4,842) |
| (2,580) |
Loss beforeincome taxes | (80,944) |
| (33,022) |
| (289,452) |
| (330,221) |
Income taxexpense (benefit) | 23,794 |
| (5,362) |
| 39,392 |
| (60,847) |
Net loss | (104,738) |
| (27,660) |
| (328,844) |
| (269,374) |
Net loss attributable to noncontrollinginterests | 2,551 |
| 481 |
| 6,009 |
| 1,769 |
Net lossattributable to Cooper-Standard Holdings Inc. | $(102,187) |
| $(27,179) |
| $(322,835) |
| $(267,605) |
|
|
|
|
|
|
|
|
Weightedaverage shares outstanding |
|
|
|
|
|
|
|
Basic | 17,099,143 |
| 16,928,472 |
| 17,045,353 |
| 16,913,850 |
Diluted | 17,099,143 |
| 16,928,472 |
| 17,045,353 |
| 16,913,850 |
|
|
|
|
|
|
|
|
Loss per share: |
|
|
|
|
|
|
|
Basic | $ (5.98) |
| $(1.61) |
| $(18.94) |
| $(15.82) |
Diluted | $(5.98) |
| $(1.61) |
| $(18.94) |
| $(15.82) |
COOPER-STANDARDHOLDINGS INC. | |||
CONSOLIDATED BALANCE SHEETS | |||
(Dollar amounts inthousands) | |||
|
|
|
|
| December 31, | ||
| 2021 |
| 2020 |
Assets | (Unaudited) |
|
|
Currentassets: |
|
|
|
Cash and cash equivalents | $ 248,010 |
| $ 438,438 |
Accounts receivable,net | 317,469 |
| 379,564 |
Tooling receivable,net | 88,900 |
| 82,150 |
Inventories | 158,075 |
| 143,742 |
Prepaidexpenses | 26,313 |
| 29,748 |
Income taxreceivable and refundable credits | 82,813 |
| 85,977 |
Other currentassets | 73,317 |
| 100,110 |
Total currentassets | 994,897 |
| 1,259,729 |
Property, plant and equipment,net | 784,348 |
| 892,309 |
Operating lease right-of-use assets,net | 111,052 |
| 109,795 |
Goodwill | 142,282 |
| 142,250 |
Intangible assets,net | 60,375 |
| 67,679 |
Deferred tax assets | 27,805 |
| 66,111 |
Other assets | 105,734 |
| 74,071 |
Total assets | $ 2,226,493 |
| $ 2,611,944 |
Liabilities and Equity |
|
|
|
Currentliabilities: |
|
|
|
Debt payable within one year | $ 56,111 |
| $ 40,731 |
Accountspayable | 348,133 |
| 385,284 |
Payrollliabilities | 69,353 |
| 112,727 |
Accruedliabilities | 101,466 |
| 110,827 |
Currentoperating lease liabilities | 22,552 |
| 21,711 |
Total currentliabilities | 597,615 |
| 671,280 |
Long-term debt | 980,604 |
| 982,760 |
Pension benefits | 129,880 |
| 152,230 |
Postretirement benefits other thanpensions | 43,498 |
| 49,613 |
Long-term operating leaseliabilities | 92,760 |
| 90,517 |
Deferred taxliabilities | 8,414 |
| 8,638 |
Other liabilities | 42,362 |
| 32,795 |
Totalliabilities | 1,895,133 |
| 1,987,833 |
Equity: |
|
|
|
Common stock | 17 |
| 17 |
Additionalpaid-in capital | 504,497 |
| 498,719 |
Retainedearnings | 25,553 |
| 350,270 |
Accumulatedother comprehensive loss | (205,184) |
| (241,896) |
Total Cooper-Standard Holdings Inc. equity | 324,883 |
| 607,110 |
Noncontrollinginterests | 6,477 |
| 17,001 |
Totalequity | 331,360 |
| 624,111 |
Totalliabilities and equity | $ 2,226,493 |
| $2,611,944 |
COOPER-STANDARDHOLDINGS INC. | |||||
CONSOLIDATED STATEMENTS OF CASHFLOWS | |||||
(Dollaramounts in thousands) | |||||
|
|
|
|
|
|
| Year Ended December 31, | ||||
| 2021 |
| 2020 |
| 2019 |
| (Unaudited) |
|
|
|
|
OperatingActivities: |
|
|
|
|
|
Net (loss) income | $(328,844) |
| $(269,374) |
| $ 62,213 |
Adjustments toreconcile net (loss) income to net cash (used in) provided by |
|
|
|
|
|
Depreciation | 131,661 |
| 142,618 |
| 133,987 |
Amortization ofintangibles | 7,347 |
| 11,611 |
| 17,966 |
Gain on sale ofbusiness, net | (696) |
| (2,834) |
| (191,571) |
Impairment charges | 25,609 |
| 104,363 |
| 23,139 |
Pensionsettlement charges | 1,279 |
| 184 |
| 15,819 |
Share-basedcompensation expense | 5,574 |
| 10,435 |
| 11,865 |
Equity inearnings, net of dividends related to earnings | 4,872 |
| 6,847 |
| (1,587) |
Deferred income taxes | 35,756 |
| (8,722) |
| 15,874 |
Other | 3,222 |
| 5,232 |
| 5,230 |
Changes inoperating assets and liabilities: |
|
|
|
|
|
Accounts andtooling receivable | 52,677 |
| 94,125 |
| (26,534) |
Inventories | (18,527) |
| (15,236) |
| 29,430 |
Prepaidexpenses | 2,951 |
| 2,099 |
| (150) |
Income taxreceivable and refundable credits | 2,221 |
| (52,374) |
| (3,620) |
Accountspayable | (25,501) |
| (18,370) |
| (14,643) |
Payroll andaccrued liabilities | (45,392) |
| 40,413 |
| (1,258) |
Other | 30,281 |
| (66,951) |
| 21,537 |
Net cash (usedin) provided by operating activities | (115,510) |
| (15,934) |
| 97,697 |
Investing activities: |
|
|
|
|
|
Capital expenditures | (96,107) |
| (91,794) |
| (164,466) |
Proceeds from sale of business, net of cash divested | — |
| (17,006) |
| 243,362 |
Acquisition of businesses, net of cashacquired | — |
| — |
| (452) |
Proceeds fromsale of fixed assets and other | 4,845 |
| 1,920 |
| 5,586 |
Net cash (used in) provided by investingactivities | (91,262) |
| (106,880) |
| 84,030 |
Financing activities: |
|
|
|
|
|
Proceeds from issuance of long-term debt, net ofdiscount | — |
| 245,000 |
| — |
Principalpayments on long-term debt | (5,533) |
| (6,192) |
| (4,494) |
Increase(decrease) in short-term debt, net | 14,935 |
| (22,372) |
| (40,406) |
Debt issuancecosts | — |
| (7,249) |
| — |
Purchase of noncontrollinginterest | (6,279) |
| — |
| (4,797) |
Repurchase ofcommon stock | — |
| — |
| (36,550) |
Taxes withheldand paid on employees' share-based payment awards | (799) |
| (544) |
| (2,787) |
Contribution from noncontrolling interestsand other | 885 |
| (928) |
| 5,042 |
Net cash provided by (used in) financingactivities | 3,209 |
| 207,715 |
| (83,992) |
Effects of exchange rate changes oncash, cash equivalents and restricted cash | 11,113 |
| (3,065) |
| (3,392) |
Changes in cash, cash equivalentsand restricted cash | (192,450) |
| 81,836 |
| 94,343 |
Cash, cash equivalents andrestricted cash at beginning of period | 443,578 |
| 361,742 |
| 267,399 |
Cash, cash equivalents andrestricted cash at end of period | $ 251,128 |
| $ 443,578 |
| $ 361,742 |
|
|
|
|
|
|
Reconciliation of cash, cash equivalents and restricted cash tothe consolidated balance sheet: |
|
| |||
|
|
|
|
|
|
Cash and cashequivalents | $ 248,010 |
| $ 438,438 |
| $ 359,536 |
Restricted cash included in othercurrent assets | 961 |
| 4,089 |
| 12 |
Restricted cash included in otherassets | 2,157 |
| 1,051 |
| 2,194 |
Total cash, cash equivalents and restrictedcash shown in the statement of cash flows | $ 251,128 |
| $ 443,578 |
| $ 361,742 |
Non-GAAP Measures
EBITDA, adjusted EBITDA, adjusted EBITDA margin,adjusted net income (loss), adjusted earnings (loss) per share andfree cash flow are measures not recognized under U.S. GAAP and whichexclude certain non-cash and special items that may obscure trends andoperating performance not indicative of the Company’s core financialactivities. Net new business is a measure not recognized under U.S.GAAP which is a representation of potential incremental future revenuebut which may not fully reflect all external impacts to futurerevenue. Management considers EBITDA, adjusted EBITDA, adjusted EBITDAmargin, adjusted net income (loss), adjusted earnings (loss) pershare, free cash flow and net new business to be key indicators of theCompany’s operating performance and believes that these and similarmeasures are widely used by investors, securities analysts and otherinterested parties in evaluating the Company’s performance. Inaddition, similar measures are utilized in the calculation of thefinancial covenants and ratios contained in the Company’s financingarrangements and management uses these measures for developinginternal budgets and forecasting purposes. EBITDA is defined as netincome (loss) adjusted to reflect income tax expense (benefit),interest expense net of interest income, depreciation andamortization, and adjusted EBITDA is defined as EBITDA furtheradjusted to reflect certain items that management does not consider tobe reflective of the Company’s core operating performance. AdjustedEBITDA margin is defined as adjusted EBITDA divided by sales. Adjustednet income (loss) is defined as net income (loss) adjusted to reflectcertain items that management does not consider to be reflective ofthe Company’s core operating performance. Adjusted basic and dilutedearnings (loss) per share is defined as adjusted net income (loss)divided by the weighted average number of basic and diluted shares,respectively, outstanding during the period. Free cash flow is definedas net cash provided by operating activities minus capitalexpenditures and is useful to both management and investors inevaluating the Company’s ability to service and repay its debt. Netnew business reflects anticipated sales from formally awardedprograms, less lost business, discontinued programs and replacementprograms and is based on IHS Markit forecast production volumes. Thecalculation of “net new business” does not reflect customer pricereductions on existing programs and may be impacted by variousassumptions embedded in the respective calculation, including actualvehicle production levels on new programs, foreign exchange rates andthe timing of major program launches.
When analyzing the Company’s operatingperformance, investors should use EBITDA, adjusted EBITDA, adjustedEBITDA margin, adjusted net income (loss), adjusted earnings (loss)per share, free cash flow and net new business as supplements to, andnot as alternatives for, net income (loss), operating income, or anyother performance measure derived in accordance with U.S. GAAP, andnot as an alternative to cash flow from operating activities as ameasure of the Company’s liquidity. EBITDA, adjusted EBITDA,adjusted EBITDA margin, adjusted net income (loss), adjusted earnings(loss) per share, free cash flow and net new business have limitationsas analytical tools and should not be considered in isolation or assubstitutes for analysis of the Company’s results of operations asreported under U.S. GAAP. Other companies may report EBITDA, adjustedEBITDA, adjusted EBITDA margin, adjusted net income (loss), adjustedearnings (loss) per share, free cash flow and net new businessdifferently and therefore the Company’s results may not becomparable to other similarly titled measures of other companies. Inaddition, in evaluating adjusted EBITDA and adjusted net income(loss), it should be noted that in the future the Company may incurexpenses similar to or in excess of the adjustments in the belowpresentation. This presentation of adjusted EBITDA and adjusted netincome (loss) should not be construed as an inference that theCompany’s future results will be unaffected by special items.Reconciliations of EBITDA, adjusted EBITDA, adjusted EBITDA margin,adjusted net income (loss) and free cash flow follow. Reconciliationof third quarter non-GAAP measures can be found in our third quarterpress release issued on November 3, 2021.
Reconciliation of Non-GAAPMeasures
EBITDA and Adjusted EBITDA
The following table provides reconciliation of EBITDA andadjusted EBITDA from net (loss) income (unaudited):
| QuarterEnded December 31, |
| Year EndedDecember 31, | ||||
| 2021 |
| 2020 |
| 2021 |
| 2020 |
| (dollar amounts inthousands) | ||||||
Net (loss)income attributable to Cooper-Standard Holdings Inc. | $ (102,187) |
| $ (27,179) |
| $ (322,835) |
| $ (267,605) |
Income tax expense (benefit) | 23,794 |
| (5,362) |
| 39,392 |
| (60,847) |
Interest expense, net of interestincome | 18,359 |
| 18,174 |
| 72,511 |
| 59,167 |
Depreciation andamortization | 33,987 |
| 37,502 |
| 139,008 |
| 154,229 |
EBITDA | $ (26,047) |
| $ 23,135 |
| $ (71,924) |
| $ (115,056) |
Impairment charges (1) | 23,762 |
| 16,470 |
| 25,609 |
| 103,887 |
Restructuringcharges | 2,699 |
| 16,246 |
| 36,950 |
| 39,482 |
Pension settlement charges (2) | 1,279 |
| 184 |
| 1,279 |
| 184 |
Lease termination costs (3) | 318 |
| 87 |
| 748 |
| 771 |
Gain on sale of business, net (4) | — |
| (520) |
| (696) |
| (2,834) |
Project costs (5) | — |
| 1,414 |
| — |
| 5,648 |
Divested noncontrolling interestdebt extinguishment | — |
| — |
| — |
| 3,595 |
AdjustedEBITDA | $ 2,011 |
| $ 57,016 |
| $ (8,034) |
| $ 35,677 |
|
|
|
|
|
|
|
|
Sales | $ 601,349 |
| $ 696,882 |
| $ 2,330,191 |
| $ 2,375,439 |
Net loss margin | (17.0) % |
| (3.9) % |
| (13.9) % |
| (11.3) % |
Adjusted EBITDA margin | 0.3 % |
| 8.2 % |
| (0.3) % |
| 1.5 % |
- Non-cashimpairment charges in 2021 related to fixed assets and goodwill.Impairment charges in 2020 included impairment of assets held for saleand other impairment charges related to fixed assets and right-of-useoperating lease assets, net of portion attributable to ournoncontrolling interests.
- Non-cash pension settlement charges and administrative feesincurred related to certain of our U.S. and non-U.S. pension plans.
- Lease termination costs no longerrecorded as restructuring charges in accordance with ASC 842.
- In 2021, subsequent adjustments wererecorded to the net gain on sale of business, which related to the2020 divestiture of our European rubber fluid transfer and specialtysealing businesses. In 2020, the gain on sale of business primarilyrelated to divestitures.
- Projectcosts recorded in selling, administration and engineering expenserelated to acquisitions and divestitures.
Adjusted Net (Loss)Income and Adjusted (Loss) Earnings Per Share
The following table provides reconciliationof net (loss) income to adjusted net (loss) income and the respective(loss) earnings per share amounts (unaudited):
| QuarterEnded December 31, |
| Year EndedDecember 31, | ||||
| 2021 |
| 2020 |
| 2021 |
| 2020 |
| (dollar amounts in thousands, except pershare amounts) | ||||||
Net (loss)income attributable to Cooper-Standard Holdings Inc. | $ (102,187) |
| $ (27,179) |
| $ (322,835) |
| $ (267,605) |
Impairment charges (1) | 23,762 |
| 16,470 |
| 25,609 |
| 103,887 |
Restructuringcharges | 2,699 |
| 16,246 |
| 36,950 |
| 39,482 |
Pension settlement charges (2) | 1,279 |
| 184 |
| 1,279 |
| 184 |
Lease termination costs (3) | 318 |
| 87 |
| 748 |
| 771 |
Gain on sale of business, net (4) | — |
| (520) |
| (696) |
| (2,834) |
Project costs (5) | — |
| 1,414 |
| — |
| 5,648 |
Divested noncontrolling interestdebt extinguishment | — |
| — |
| — |
| 3,595 |
Deferred tax valuation allowance (6) | 23,627 |
| — |
| 36,905 |
| — |
Tax impact of adjusting items (7) | 225 |
| (3,390) |
| (259) |
| (24,492) |
Adjusted net (loss) income | $(50,277) |
| $ 3,312 |
| $ (222,299) |
| $(141,364) |
|
|
|
|
|
|
|
|
Weightedaverage shares outstanding |
|
|
|
|
|
|
|
Basic | 17,099,143 |
| 16,928,472 |
| 17,045,353 |
| 16,913,850 |
Diluted (8) | 17,099,143 |
| 16,928,472 |
| 17,045,353 |
| 16,913,850 |
|
|
|
|
|
|
|
|
Loss per share: |
|
|
|
|
|
|
|
Basic | $ (5.98) |
| $(1.61) |
| $(18.94) |
| $(15.82) |
Diluted | $(5.98) |
| $(1.61) |
| $(18.94) |
| $(15.82) |
|
|
|
|
|
|
|
|
Adjusted (loss) earnings pershare: |
|
|
|
|
|
|
|
Basic | $ (2.94) |
| $ 0.20 |
| $ (13.04) |
| $(8.36) |
Diluted | $(2.94) |
| $ 0.19 |
| $ (13.04) |
| $(8.36) |
- Non-cash impairment charges in 2021related to fixed assets and goodwill. Impairment charges in 2020included impairment of assets held for sale and other impairmentcharges related to fixed assets and right-of-use operating leaseassets, net of portion attributable to our noncontrolling interests.
- Non-cash pension settlementcharges and administrative fees incurred related to certain of ourU.S. and non-U.S. pension plans.
- Lease termination costs no longer recorded as restructuringcharges in accordance with ASC 842.
- In 2021, subsequent adjustments were recorded to the net gain onsale of business, which related to the 2020 divestiture of ourEuropean rubber fluid transfer and specialty sealing businesses. In2020, the gain on sale of business primarily related todivestitures.
- Project costsrecorded in selling, administration and engineering expense related toacquisitions and divestitures.
- Relates to the initial recognition of our valuation allowance onnet deferred tax assets in the U.S and certain internationaljurisdictions.
- Represents theelimination of the income tax impact of the above adjustments, bycalculating the income tax impact of these adjusting items using theappropriate tax rate for the jurisdiction where the charges wereincurred.
- For the purpose ofcalculating adjusted diluted earnings (loss) per share for the quarterended December 31, 2020, the weighted average shares outstanding were17,097,743.
Free Cash Flow
Thefollowing table provides a reconciliation of net cash (used in)provided by operating activities to free cash flow(unaudited):
| Quarter Ended December 31, |
| Year EndedDecember 31, | ||||
| 2021 |
| 2020 |
| 2021 |
| 2020 |
| (dollar amounts inthousands) | ||||||
Net cash (used in) provided by operating activities | $ (4,022) |
| $ 10,598 |
| $ (115,510) |
| $ (15,934) |
Capitalexpenditures | (20,142) |
| (18,387) |
| (96,107) |
| (91,794) |
Free cashflow | $(24,164) |
| $(7,789) |
| $(211,617) |
| $(107,728) |
ContactDetails
Contact for Media:
ChrisAndrews
+1 248-596-6217
Contactfor Analysts
Roger Hendriksen
+1 248-596-6465
roger.hendriksen@cooperstandard.com
CompanyWebsite
http://www.cooperstandard.com/
Copyright (c) 2022 TheNewswire - All rights reserved.