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Albany International Reports Fourth-Quarter Results



  Albany International Reports Fourth-Quarter Results

Fourth-Quarter Financial Highlights

  * Net sales from continuing operations were $194.3 million, a decrease of
    1.6 percent compared to Q4 2011.
  * Adjusted EBITDA from continuing operations for Q4 2012 was $37.8 million,
    compared to $29.8 million in Q4 2011 (see Tables 4 and 5).
  * Q4 2012 income from continuing operations was $0.25 per share. These
    results include restructuring charges of $0.02, foreign currency
    revaluation losses of $0.08, and net unfavorable income tax adjustments of
    $0.01 (see Table 6).
  * Q4 2011 income from continuing operations was a loss of $0.32 per share.
    These results included restructuring charges of $0.10 and foreign currency
    revaluation gains of $0.08, and net unfavorable income tax adjustments of
    $0.50 (see Table 7).
  * Net debt declined $19.5 million during the quarter and $126.9 million for
    the full year (see Table 8).

Business Wire

ROCHESTER, N.H. -- February 6, 2013

Albany International Corp. (NYSE: AIN), a global advanced textiles and
materials processing company with core businesses in machine clothing and
engineered composites, reported Q4 2012 income from continuing operations of
$8.0 million ($0.25 per share). These results include restructuring charges of
$0.9 million ($0.02 per share), foreign currency revaluation losses of $4.0
million ($0.08 per share), and net unfavorable income tax adjustments of $0.1
million ($0.01 per share) (see Table 6).

Q4 2011 income from continuing operations was a loss of $10.0 million ($0.32
per share). These results included restructuring charges of $4.9 million
($0.10 per share), foreign currency revaluation gains of $3.5 million ($0.08
per share), and net unfavorable income tax adjustments of $15.6 million ($0.50
per share) (see Table 7).

Net sales from continuing operations were $194.3 million, a decrease of 1.6
percent compared to Q4 2011. The following table summarizes net sales by
segment and the effect of changes in currency translation rates:

Table 1
                                                     Impact of     Percent
               Net Sales                             Changes       Change
               Three Months ended                    in Currency   excluding
               December 31,                Percent   Translation   Currency
(in            2012          2011          Change    Rates         Rate Effect
thousands)
Machine
Clothing       $ 174,295     $ 183,218     -4.9  %   ($2,161  )    -3.7    %
(MC)
Engineered
Composites       20,040        14,182      41.3      -             41.3     
(AEC)
Total          $ 194,335     $ 197,400     -1.6  %   ($2,161  )    -0.5    %
 

Gross profit was $79.0 million (40.6 percent of net sales) in the fourth
quarter of 2012, compared to $77.0 million (39.0 percent of net sales) in the
same period of 2011. The increase in gross profit percentage was primarily due
to results at Machine Clothing, where gross profit margins increased from 42.1
percent in 2011 to 45.0 percent in 2012, reflecting high plant utilization in
the Americas, favorable geographic sales mix, and the cumulative effect of
restructuring actions taken over the last year.

Selling, technical, general, and research (STG&R) expenses were $58.4 million,
or 30.0 percent of net sales, in the fourth quarter of 2012. STG&R expenses
included losses of $1.2 million related to the revaluation of
non-functional-currency assets and liabilities. In the fourth quarter of 2011,
STG&R expenses were $61.8 million, or 31.3 percent of net sales, including
gains of $0.9 million related to the revaluation of non-functional-currency
assets and liabilities. The decrease in STG&R expense reflects lower bad debt
charges and lower pension expense resulting from the settlement of certain
pension liabilities in Q2 2012.

The following table summarizes fourth-quarter operating income by segment.

Table 2
                        Operating Income/(loss)
                        Three Months ended
                        December 31,
(in thousands)          2012          2011
Machine Clothing        $ 43,112      $ 39,912   
Engineered Composites     (187    )     (583    )
Research expenses         (7,564  )     (8,230  )
Unallocated expenses      (15,696 )     (20,803 )
Total                   $ 19,665      $ 10,296   
 

Q4 2012 Machine Clothing operating income included restructuring charges of
$1.1 million and foreign currency revaluation losses of $1.2 million. Q4 2011
Machine Clothing operating income included restructuring charges of $2.5
million and foreign currency revaluation gains of $0.9 million. Unallocated
expenses included restructuring charges of $2.4 million in Q4 2011.

Q4 2012 Other income/expense, net, was expense of $2.6 million, including
losses of $2.8 million related to the revaluation of non-functional-currency
intercompany balances. Other income/expense, net, in Q4 2011 was income of
$2.2 million, including income of $2.7 million related to the revaluation of
non-functional-currency intercompany balances.

The following table summarizes currency revaluation effects on certain
financial metrics:

Table 3
                              Income/(loss) attributable
                              to currency revaluation
                              Three Months ended
                              December 31,
(in thousands)                2012           2011
Operating income              ($1,186  )     $  861     
Other income/(expense), net   ( 2,829  )        2,650   
Total                         ($4,015  )     $  3,511   
 

The Company’s effective income tax rate, exclusive of discrete tax items, was
38.5 percent for the fourth quarter of 2012, compared to 33.1 percent for the
fourth quarter of 2011. Q4 2012 income tax expense included an unfavorable
adjustment of $1.2 million related to a change in the tax rate, and net
favorable discrete income tax adjustments of $1.1 million. Q4 2011 income tax
expense included net discrete income tax charges of $16.2 million, and a
favorable adjustment of $0.7 million related to a change in tax rate. The
discrete tax charge in Q4 2011 was principally due to recording a valuation
allowance in Germany resulting from the sale of the Company’s Doors business.

The following tables summarize Adjusted EBITDA from continuing operations:

Table 4
Three Months ended        
December 31, 2012
                           Machine      Engineered   Research and   Total
(in thousands)             Clothing     Composites   Unallocated    Company
Income/(loss) from         $ 43,112        ($187 )   ($34,945  )    $ 7,980   
continuing operations
Interest expense, net        -             -         3,991            3,991   
Income tax expense           -             -         5,127            5,127   
Depreciation and             11,576        1,595     2,564            15,735  
amortization
EBITDA from continuing       54,688        1,408     (23,263   )      32,833  
operations
Restructuring and other,     1,071         -         (159      )      912     
net
Foreign currency
revaluation                  1,187         (2    )   2,830            4,015   
losses/(gains)
Adjusted EBITDA from       $ 56,946     $  1,406     ($20,592  )    $ 37,760  
continuing operations
 

Table 5
Three Months ended                                               
December 31, 2011
                         Machine      Engineered   Research and   Total
(in thousands)           Clothing     Composites   Unallocated    Company
Income/(loss) from       $ 39,912        ($583 )   ($49,322  )      ( $9,993 )
continuing operations
Interest expense, net      -             -         4,182            4,182     
Income tax expense         -             -         18,279           18,279    
Depreciation and           12,038        1,319     2,640            15,997    
amortization
EBITDA from continuing     51,950        736       (24,221   )      28,465    
operations
Restructuring and          2,465         -         2,396            4,861     
other, net
Foreign currency           (860   )      (1    )   (2,650    )      (3,511   )
revaluation gains
Adjusted EBITDA from     $ 53,555     $  735       ($24,475  )    $ 29,815    
continuing operations
 

Capital spending for equipment and software was $11.8 million for the fourth
quarter of 2012, bringing the full-year total to $37.2 million. Depreciation
and amortization related to continuing operations was $15.7 million for Q4
2012 and $63.1 million for the full year.

CEO Comments

President and CEO Joseph Morone said, “Q4 2012 was another good quarter for
Albany International. Both businesses continued to perform well, Adjusted
EBITDA was 27 percent higher than in the comparable period in 2011, and cash
generation was once again strong and resulted in an additional $20 million
reduction in net debt.

“In MC, the market trends of the past several quarters persisted. Sales
remained stable in the Americas and China, weakened in Asia outside of China,
and were well below 2011 levels in Europe. Pricing was stable around the world
except for Europe, where it was under considerable pressure. On a positive
note, we did see the first indications during Q4 that the sales decline in
Europe might be moderating, as for the first time in over a year, quarterly
sales increased on a sequential basis. Our competitive performance continues
to be strong, as our market share with the leading papermakers in every region
of the world is either holding firm or growing. Gross margins were once again
strong and for the third consecutive quarter, exceeded 44 percent. Meanwhile,
we decided in Q4 to make a major investment aimed at further enhancing our
strength in R&D. For the last few years, at the same time that we have been
introducing a steady stream of new products that helps to account for our
strong competitive performance, we have been developing an entirely new,
proprietary technology platform that offers the potential for an array of new
products across all of our product segments. In 2013, we will begin
construction of a $15 million facility capable of producing full-scale
prototypes of new products based on this new technology platform at our plant
in Kaukauna, Wisconsin. Our objective is to accelerate the cycle of
exploration, development, scale-up, testing, and market introduction of this
new generation of products.

“Our outlook for MC remains unchanged. For both the near and long term, we
continue to view this as a business with the potential for flat,
year-over-year Adjusted EBITDA. We still expect Adjusted EBITDA in 2013 to be
roughly comparable to Adjusted EBITDA in 2012. Because of seasonal effects, we
expect a weak Q1, although it is unlikely to be as weak as Q1 2012. This
outlook for 2013 and beyond assumes that the conditions in the MC market will
reflect the long-term sectoral trends of the paper industry: stability in the
Americas, with growth in South America offsetting decline in Canada, and
growth in packaging and tissue offsetting decline in newsprint, printing, and
writing grades; in Europe, the sharp drops in demand due to the overcapacity
in the paper industry should give way to the more predictable, structural
declines in the newsprint, printing, and writing grades; and these more
structural declines in Europe should be offset by continued growth in Asia.
Our margins in Machine Clothing should hold, as long as overall sales continue
at current levels and we continue to do an effective job of matching capacity
with underlying market conditions and offsetting inflationary increases.

“For AEC, the trend of the past several quarters also continued in Q4. Sales
were 41 percent higher than a year ago, while Adjusted EBITDA nearly doubled.
The growth was driven primarily by LEAP program activities, which now account
for 45 percent of sales (compared to 25 percent in Q4 2011). We continue to
make good progress against the major LEAP program milestones – construction of
the two plants, development of parts and maturation of the manufacturing
process, and production of parts for testing. We also continued to make good
progress on the R&D front; of particular note, the development of new
composite products with SAFRAN for future upgrades to the LEAP engine, and the
continued advancement of our ceramic matrix substrate on Boeing’s Ceramic
Matrix Composite Engine Nozzle currently undergoing ground tests on a
full-scale engine; flight tests are scheduled later this year.

“As for the outlook for AEC, we expect continued year-over-year strong growth
in sales in 2013. For the longer term, while there is still a fair amount of
uncertainty, it now appears that AEC’s production of LEAP components will be
accelerated by about 12 months. This schedule is still subject to change. In
our earlier releases, we suggested that AEC had the potential to reach $120
million in revenue by 2016 and that sales would ramp up rapidly between 2016
and 2019. Assuming this accelerated schedule holds, it now appears possible
that AEC will reach $120 million revenue by 2015 and that the ramp-up will
occur between 2015 and 2018. Any acceleration of AEC production will require
an acceleration of AEC capital spending. Again assuming an accelerated
schedule, the peak years for LEAP capital spending will likely be 2013 to
2015, rather than 2014 to 2016 as we had previously assumed.

“In sum, Q4 was another strong quarter for Albany International, and we expect
the trends exhibited in Q4 – steady Adjusted EBITDA in MC, strong sales growth
in AEC – to continue through 2013. At the same time, 2013 will be a year of
substantial investment for future performance, given our decision to invest in
the new R&D rapid scale-up facility in MC and the likely acceleration of AEC’s
LEAP production.”

CFO Comments

CFO and Treasurer John Cozzolino commented, “The Company generated good cash
flow during the quarter with cash balances, mostly held outside of the U.S.,
increasing to $191 million. Primarily due to that increase in cash, net debt
declined about $20 million, as compared to Q3 (see Table 8), to approximately
$129 million. Our leverage ratio, as defined in our primary debt agreements,
was 1.06 at the end of Q4, while $258 million was available on our $390
million credit facility. On January 25, the Company announced the redemption,
at 100 percent of principal, of all remaining 2.25 percent Convertible Senior
Notes due 2026, of which an aggregate of $28.4 million in principal amount is
outstanding. The redemption date will be March 15, 2013. In addition, the
first $50 million of the Company’s debt with Prudential is due in October
2013. The Company expects to finance both debt repayments with borrowings from
its bank credit facility.

“Accounts receivable and inventory, excluding currency effects, declined
during Q4 as the effect of business growth in AEC was more than offset by
continued improvement in Machine Clothing. In accounts receivable, Days Sales
Outstanding remained flat at 63 days, compared to Q3, while inventory as a
percent of net sales increased from 15.2 percent at the end of Q3 to 15.7
percent at the end of Q4.

“Capital expenditures in Q4 were about $12 million, bringing the full-year
2012 total to just over $37 million. As a result of the apparent acceleration
of AEC’s LEAP production requirements, the Company expects capital spending to
increase sharply in 2013. We continue to expect that average capital spending
during the five-year period 2012 to 2016 will be $70 million per year,
although the actual amount of capital spent in each year may vary widely due
to changes in production and vendor payment schedules.

“Revaluation of non-functional-currency assets and liabilities generated a
total loss of $4 million in Q4. This loss was primarily due to the revaluation
of intercompany loans to the euro as well as the revaluation of U.S. dollar
cash holdings and trade receivables to the euro.

“Our income tax rate for 2012, exclusive of discrete tax adjustments, was 38.5
percent. Including the utilization of net operating loss carry-forwards and
other deferred tax assets, cash paid for income taxes in 2012 was $15.1
million.”

The Company plans a webcast to discuss fourth-quarter 2012 financial results
on Thursday, February 7, 2013, at 9:00 a.m. Eastern Time. For access, go to
www.albint.com.

About Albany International Corp.

Albany International is a global advanced textiles and materials processing
company, with two core businesses. Machine Clothing is the world’s leading
producer of custom-designed fabrics and belts essential to production in the
paper, nonwovens, and other process industries. Albany Engineered Composites
is a rapidly growing supplier of highly engineered composite parts for the
aerospace industry. Albany International is headquartered in Rochester, New
Hampshire, operates 18 plants in 11 countries, employs 4,000 people worldwide,
and is listed on the New York Stock Exchange (Symbol AIN). Additional
information about the Company and its products and services can be found at
www.albint.com.

This release contains certain items, such as earnings before interest, taxes,
depreciation and amortization (EBITDA), EBITDA from continuing operations,
Adjusted EBITDA, sales excluding currency effects, effective income tax rate
exclusive of income tax adjustments, net debt, and certain income and expense
items on a per-share basis, that could be considered non-GAAP financial
measures. Such items are provided because management believes that, when
presented together with the GAAP items to which they relate, they provide
additional useful information to investors regarding the Company’s operational
performance. Presenting increases or decreases in sales, after currency
effects are excluded, can give management and investors insight into
underlying sales trends. An understanding of the impact in a particular
quarter of specific restructuring costs, or other gains and losses, on
operating income or EBITDA can give management and investors additional
insight into quarterly performance, especially when compared to quarters in
which such items had a greater or lesser effect, or no effect.

The effect of changes in currency translation rates is calculated by
converting amounts reported in local currencies into U.S. dollars at the
exchange rate of a prior period. That amount is then compared to the U.S.
dollar amount reported in the current period. The Company calculates Income
tax adjustments by adding discrete tax items to the effect of a change in tax
rate for the reporting period. The Company calculates its effective Income tax
rate, exclusive of Income tax adjustments, by removing Income tax adjustments
from total Income tax expense, then dividing that result by Income before tax.
The Company calculates EBITDA by adding Interest expense net, Income taxes,
and Depreciation and Amortization to Net income. Adjusted EBITDA is calculated
by adding to EBITDA, costs associated with restructuring and pension
settlement charges, and then adding or subtracting revaluation losses or gains
and subtracting building sale gains. The Company believes that EBITDA and
Adjusted EBITDA provide useful information to investors because they provide
an indication of the strength and performance of the Company's ongoing
business operations, including its ability to fund discretionary spending such
as capital expenditures and strategic investments, as well as its ability to
incur and service debt. While depreciation and amortization are operating
costs under GAAP, they are non-cash expenses equal to current period
allocation of costs associated with capital and other long-lived investments
made in prior periods. While restructuring expenses, foreign currency
revaluation losses or gains, pension settlement charges, and building sale
gains have an impact on the Company's net income, removing them from EBITDA
can provide, in the opinion of the Company, a better measure of operating
performance. EBITDA is also a calculation commonly used by investors and
analysts to evaluate and compare the periodic and future operating performance
and value of companies. EBITDA, as defined by the Company, may not be similar
to EBITDA measures of other companies. Such EBITDA measures may not be
considered measurements under GAAP, and should be considered in addition to,
but not as substitutes for, the information contained in the Company’s
statements of income.

The Company discloses certain income and expense items on a per share basis.
The Company believes that such disclosures provide important insight into
underlying quarterly earnings and are financial performance metrics commonly
used by investors. The Company calculates the per-share amount for items
included in continuing operations by using the effective tax rate utilized
during the applicable reporting period and the weighted average number of
shares outstanding for the period.

Table 6
Quarter ended December 31, 2012
                    Pre-tax                After-tax   Shares        Per Share
(in thousands,
except per share    amounts   Tax Effect   Effect      Outstanding   Effect
amounts)
Restructuring and
other, net from     $912      $351         $561        31,402        $0.02   
continuing
operations
Foreign currency
revaluation
losses from         4,015     1,546        2,469       31,402        0.08    
continuing
operations
Unfavorable
effect of change    -         1,178        1,178       31,402        0.04    
in tax rate
Net discrete
income tax
benefit from        -         1,098        1,098       31,402        0.03    
continuing
operations
                                                                             

Table 7
Quarter ended December 31, 2011
                   Pre-tax                 After-tax   Shares        Per Share
(in thousands,
except per share   amounts    Tax Effect   Effect      Outstanding   Effect
amounts)
Restructuring
and other, net     $4,861     $1,609       $3,252      31,283        $0.10   
from continuing
operations
Foreign currency
revaluation
gains from         3,511      1,162        2,349       31,283        0.08    
continuing
operations
Favorable effect
of change in tax   -          683          683         31,283        0.02    
rate
Net discrete
income tax
charge from        -          16,243       16,243      31,283        0.52    
continuing
operations
 

The following table contains the calculation of net debt:

Table 8
                                   December 31,   September 30,   December 31,
(in thousands)                     2012           2012            2011
Notes and loans payable            $586           $276            $424       
Current maturities of long-term    83,276         33,066          1,263      
debt
Long-term debt                     235,877        289,129         373,125    
Total debt                         319,739        322,471         374,812    
Cash                               190,718        173,939         118,909    
Net debt                           $129,021       $148,532        $255,903   
                                                                             

This press release may contain statements, estimates, or projections that
constitute “forward-looking statements” as defined under U.S. federal
securities laws. Generally, the words “believe,” “expect,” “intend,”
“estimate,” “anticipate,” “project,” “will,” “should” and similar expressions
identify forward-looking statements, which generally are not historical in
nature. Forward-looking statements are subject to certain risks and
uncertainties (including, without limitation, those set forth in the Company’s
most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q) that
could cause actual results to differ materially from the Company’s historical
experience and our present expectations or projections.

Forward-looking statements in this release or in the webcast include, without
limitation, statements about economic and paper industry trends and conditions
during 2013 and in future years; sales, EBITDA, Adjusted EBITDA and operating
income expectations in 2013 and in future periods in each of the Company’s
businesses and for the Company as a whole, the timing and impact of production
and development programs in the Company’s AEC business segment; the amount and
timing of capital expenditures, future tax rates and cash paid for taxes,
depreciation and amortization, future debt levels and debt covenant ratios,
future revaluation gains and losses, and the Company’s ability to reduce
costs. Furthermore, a change in any one or more of the foregoing factors could
have a material effect on the Company’s financial results in any period. Such
statements are based on current expectations, and the Company undertakes no
obligation to publicly update or revise any forward-looking statements.

Statements expressing management’s assessments of the growth potential of its
businesses, or referring to earlier assessments of such potential, are not
intended as forecasts of actual future growth, and should not be relied on as
such. While management believes such assessments to have a reasonable basis,
such assessments are, by their nature, inherently uncertain. This release and
earlier releases set forth a number of assumptions regarding these
assessments, including historical results, independent forecasts regarding the
markets in which these businesses operate, and the timing and magnitude of
orders for our customers’ products. Historical growth rates are no guarantee
of future growth, and such independent forecasts and assumptions could prove
materially incorrect, in some cases.

ALBANY INTERNATIONAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
 
Three Months Ended                                   Years Ended
December 31,                                         December 31,
                                                      
2012              2011                               2012          2011
                                                                              
$  194,335        $  197,400     Net sales           $ 760,941     $ 787,287
   115,376           120,424     Cost of goods         455,545       473,121  
                                 sold
                                                                              
   78,959            76,976      Gross profit          305,396       314,166
                                 Selling, general,
   44,439            47,078      and                   169,774       174,395
                                 administrative
                                 expenses
                                 Technical,
   13,943            14,741      product               52,962        55,846
                                 engineering, and
                                 research expenses
   912               4,861       Restructuring and     7,061         9,317
                                 other, net
                                 Pension
   -                 -           settlement            119,735       -        
                                 expense
                                                                              
   19,665            10,296      Operating             (44,136 )     74,608
                                 income/(loss)
   3,991             4,182       Interest expense,     16,601        18,121
                                 net
                                 Other
   2,567             (2,172  )   expense/(income),     7,629         2,639    
                                 net
                                                                              
                                 Income/(loss)
   13,107            8,286       before income         (68,366 )     53,848
                                 taxes
   5,127             18,279      Income tax            (27,523 )     32,582   
                                 expense/(benefit)
                                                                              
                                 Income/(loss)
   7,980             (9,993  )   from continuing       (40,843 )     21,266   
                                 operations
                                                                              
                                 Income from
   -                 7,794       operations of         4,776         24,101
                                 discontinued
                                 business
                                 (Loss)/gain on
   (80      )        -           sale of               92,296        -
                                 discontinued
                                 business
                                 Income tax
   (318     )        5,032       (benefit)/expense     25,252        10,429   
                                 on discontinued
                                 operations
                                 Income from
   238               2,762       discontinued          71,820        13,672   
                                 operations
$  8,218             ($7,231 )   Net income/(loss)   $ 30,977      $ 34,938   
                                                                              
                                 Earnings per
                                 share - Basic
                                 Income/(loss)
$  0.25              ($0.32  )   from continuing       ($1.30  )   $ 0.68
                                 operations
   0.01              0.09        Discontinued          2.29          0.44     
                                 operations
$  0.26              ($0.23  )   Net income/(loss)   $ 0.99        $ 1.12     
                                                                              
                                 Earnings per
                                 share - Diluted
                                 Income/(loss)
$  0.25              ($0.32  )   from continuing   *   ($1.30  )   $ 0.67
                                 operations
   0.01              0.09        Discontinued          2.27        $ 0.44     
                                 operations
$  0.26              ($0.23  )   Net income/(loss)   $ 0.97        $ 1.11     
                                                                              
                                 Shares used in
                                 computing
                                 earnings per
                                 share:
   31,402            31,283      Basic                 31,356        31,262
   31,681            31,283      Diluted               31,636        31,510
                                                                              
$  0.14           $  0.13        Dividends per       $ 0.55        $ 0.51
                                 share
 
 
* Due to a loss from continuing operations, year ended 2012 diluted loss per
share is equal to the basic per share calculation.
 

ALBANY INTERNATIONAL CORP.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
(unaudited)
 
                                                 December 31,    December 31,
                                                 2012            2011
ASSETS
Cash and cash equivalents                        $ 190,718       $ 118,909
Accounts receivable, net                           171,535         147,511
Inventories                                        119,183         129,803
Income taxes receivable and deferred               20,594          30,010
Prepaid expenses and other current assets          10,435          13,349
Current assets of discontinued operations          -               67,351     
Total current assets                               512,465         506,933
                                                                  
Property, plant and equipment, net                 420,154         438,953
Intangibles                                        848             1,079
Goodwill                                           76,522          75,469
Deferred taxes                                     123,886         134,644
Other assets                                       22,822          23,383
Noncurrent assets of discontinued operations       -               50,467     
Total assets                                     $ 1,156,697     $ 1,230,928  
                                                                  
LIABILITIES AND SHAREHOLDERS' EQUITY
Notes and loans payable                          $ 586           $ 424
Accounts payable                                   35,117          32,708
Accrued liabilities                                103,257         105,104
Current maturities of long-term debt               83,276          1,263
Income taxes payable and deferred                  13,552          8,766
Current liabilities of discontinued operations     -               22,446     
Total current liabilities                          235,788         170,711
                                                                  
Long-term debt                                     235,877         373,125
Other noncurrent liabilities                       136,012         185,596
Deferred taxes and other credits                   55,509          71,529
Noncurrent liabilities of discontinued             -               14,117     
operations
Total liabilities                                  663,186         815,078    
                                                                  
SHAREHOLDERS' EQUITY
Preferred stock, par value $5.00 per share;        -               -
authorized 2,000,000 shares; none issued
Class A Common Stock, par value $.001 per
share; authorized 100,000,000 shares; issued       37              37
36,642,204 in 2012 and 36,540,842 in 2011
Class B Common Stock, par value $.001 per
share; authorized 25,000,000 shares; issued        3               3
and outstanding 3,236,098 in 2012 and 2011
Additional paid in capital                         395,381         391,495
Retained earnings                                  435,775         422,044
Accumulated items of other comprehensive
income:
Translation adjustments                            (7,659    )     (19,111   )
Pension and postretirement liability               (69,484   )     (118,104  )
adjustments
Derivative valuation adjustment                    (2,878    )     (2,594    )
Treasury stock (Class A), at cost 8,467,873        (257,664  )     (257,920  )
shares in 2012, and 8,479,487 shares in 2011
Total shareholders' equity                         493,511         415,850    
Total liabilities and shareholders' equity       $ 1,156,697     $ 1,230,928  
 

ALBANY INTERNATIONAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
 
Three Months Ended                                  Years Ended
December 31,                                        December 31,
                                                     
2012          2011                                  2012           2011
                            OPERATING ACTIVITIES
$ 8,218         ($7,231 )   Net income/(loss)       $ 30,977       $ 34,938
                            Adjustments to
                            reconcile net
                            income/(loss) to net
                            cash provided by
                            operating activities:
  14,131        14,569      Depreciation              56,769         57,502
  1,604         2,133       Amortization              6,466          8,883
  203           188         Noncash interest          1,027          753
                            expense
                            Change in long-term
  2,719         8,780       liabilities, deferred     (123,887 )     237
                            taxes and other
                            credits
                            Provision for
  227           2,241       write-off of              427            2,345
                            property, plant and
                            equipment
                            Write-off of pension
  -             -           liability adjustment      118,350        -
                            due to settlement
  (81     )     -           (Gain) on disposition     (92,457  )     (1,022  )
                            of assets
  (3      )     (40     )   Excess tax benefit of     (40      )     (93     )
                            options exercised
                            Compensation and
  995           843         benefits paid or          2,790          2,812
                            payable in Class A
                            Common Stock
                                                                    
                            Changes in operating
                            assets and
                            liabilities, net of
                            business acquisitions
                            and divestitures:
  1,880         (1,896  )   Accounts receivable       (4,990   )     (12,082 )
  3,189         20,355      Inventories               11,565         7,105
  843           2,506       Prepaid expenses and      592            314
                            other current assets
  (760    )     (1,245  )   Income taxes prepaid      9,472          (3,747  )
                            and receivable
  7,539         (2,682  )   Accounts payable          3,298          (1,677  )
  (5,455  )     988         Accrued liabilities       7,616          6,124
  8,070         (8,175  )   Income taxes payable      7,308          2,422
  1,466         (367    )   Other, net                (776     )     455      
  44,785        30,967      Net cash provided by      34,507         105,269  
                            operating activities
                                                                    
                            INVESTING ACTIVITIES
                            Purchases of
  (11,809 )     (6,833  )   property, plant and       (37,046  )     (24,988 )
                            equipment
  (7      )     (1,594  )   Purchased software        (161     )     (3,692  )
  -             -           Proceeds from sale of     -              2,860
                            assets
                            Proceeds from sale of
  -             -           discontinued              150,654        -        
                            operations
                            Net cash (used
  (11,816 )     (8,427  )   in)/provided by           113,447        (25,820 )
                            investing activities
                                                                    
                            FINANCING ACTIVITIES
  864           13,001      Proceeds from             46,028         14,386
                            borrowings
  (3,774  )     (28,488 )   Principal payments on     (102,128 )     (65,575 )
                            debt
  232           374         Proceeds from options     1,311          789
                            exercised
  3             40          Excess tax benefit of     40             93
                            options exercised
  (8,787  )     (4,056  )   Dividends paid            (21,315  )     (15,616 )
  (11,462 )     (19,129 )   Net cash (used in)        (76,064  )     (65,923 )
                            financing activities
                                                                    
                            Effect of exchange
  (4,728  )     (725    )   rate changes on cash      (81      )     (3,373  )
                            and cash equivalents
                                                                    
  16,779        2,686       Increase in cash and      71,809         10,153
                            cash equivalents
                            Change in cash
  -             (7,887  )   balances of               -              (9,169  )
                            discontinued
                            operations
                            Cash and cash
  173,939       124,110     equivalents at            118,909        117,925  
                            beginning of period
                            Cash and cash
$ 190,718     $ 118,909     equivalents at end of   $ 190,718      $ 118,909  
                            period

Contact:

Investors:
Albany International Corp.
John Cozzolino, 518-445-2281
john.cozzolino@albint.com
or
Media:
Albany International Corp.
Susan Siegel, 603-330-5866
susan.siegel@albint.com
or
Kekst and Company for Albany International
Michael Herley, 212-521-4897
michael-herley@kekst.com
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