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Tower International Reports Solid Fourth Quarter Results and Positive Outlooks for 2013 and 2014

Tower International Reports Solid Fourth Quarter Results and Positive Outlooks
                              for 2013 and 2014

PR Newswire

LIVONIA, Mich., Feb. 15, 2013

LIVONIA, Mich., Feb. 15, 2013 /PRNewswire/ --Tower International, Inc. [NYSE:
TOWR], a leading integrated global manufacturer of engineered structural metal
components and assemblies, today announced its 2012 results and provided
preliminary outlooks for 2013 and 2014.

  oRevenue from continuing operations for fourth quarter 2012 was $508
    million, slightly better than company guidance of $503 million. Revenue
    was down from $517 million in the fourth quarter 2011.
  oAdjusted EBITDA for the quarter was $43.4 million, ahead of guidance of
    $42 million. Adjusted EBITDA was down from $46.7 million a year ago,
    mainly reflecting slightly less favorable mix and adverse foreign-exchange
    translation.
  oNet income for the fourth quarter was $13.7 million, compared with a net
    loss of $26.1 million a year ago. As detailed in the financial table
    below, this year's fourth quarter included certain items that favorably
    impacted results by $12.7 million. Excluding these items and comparable
    items in the fourth quarter of 2011, diluted adjusted earnings per share
    from continuing operations were $0.05 this year, compared with $0.32 last
    year.
  oFree cash flow in the fourth quarter was positive $29 million. Liquidity
    at year-end was good, at $207 million.
  oResults from continuing operations for full year 2012 included revenue of
    $2.085 billion, adjusted EBITDA of $193.7 million, and adjusted earnings
    of $1.08 per share.
  oFor 2013, the preliminary outlook includes improvements from 2012 in
    revenue ($2.1 billion to $2.15 billion), adjusted EBITDA ($200 million to
    $210 million), adjusted earnings per share ($1.10 to $1.40), and free cash
    flow (positive $15 million to $25 million).
  oFor 2014, Tower's net backlog is an increase of approximately $100 million
    in revenue from 2013 from new business wins net of losses (at current
    industry and customer production mix).

"Tower finished 2012 with a solid fourth quarter and full year, and the
company is well-positioned for 2013 and 2014," said President and CEO Mark
Malcolm. "Despite uneven industry and customer production in some regions in
2012, the company exceeded initial Plan expectations for all key financial
deliverables. Additional highlights included the achievement of record
quality and the opportunistic, accretive sale of Korean operations. Looking
forward, 2013 should be an up year if customer volumes hold up, generating
positive free cash flow and a growing liquidity cushion. Our revenue backlog
and potential significant re-financing savings in 2014 are other positive
catalysts on the near horizon."

Tower to Host Conference Call Today at 11 a.m. EST

Tower will discuss its fourth quarter 2012 results and other related matters
in a conference call at 11 a.m. EST today. Participants may listen to the
audio portion of the conference call either through a live audio webcast on
the Company's website or by telephone. The slide presentation and webcast can
be accessed via the investor relations portion of Tower's website
www.towerinternational.com. To dial into the conference call, domestic
callers should dial1-866-393-4576, international callers should dial
1-706-679-1462. An audio recording of the call will be available
approximately two hours after the completion of the call. To access this
recording, please dial 1-855-859-2056 (domestic) or 1-404-537-3406
(international) and reference Conference I.D. #97607881. A webcast replay
will also be available and may be accessed via Tower's website.

Non-GAAP Financial Measures

This press release includes the following non-GAAP financial measures:
"Adjusted EBITDA", "free cash flow," "net debt," and "diluted adjusted income
/ (loss) per share." We define Adjusted EBITDA as net income / (loss) before
interest, taxes, depreciation, amortization, restructuring items and other
adjustments described in the reconciliations provided in this press release.
Free cash flow is defined as net cash provided by or used in operating
activities less cash disbursed for purchases of property, plant and equipment.
Net debt is defined as total debt less cash and cash equivalents. Diluted
adjusted income / (loss) per share excludes the impact of certain items as
described below that are included in our net income / (loss). We use Adjusted
EBITDA and free cash flow as supplements to information provided in accordance
with generally accepted accounting principles ("GAAP") in evaluating our
business and they are included in this press release because they are
principal factors upon which our management assesses performance. We believe
these items as well as the non-GAAP financial measures of net debt and diluted
adjusted income / (loss) per share are useful to investors as they provide an
additional tool for investors to use in evaluating operating results and
trends, and in comparing our financial results with other companies.
Reconciliations of these non-GAAP financial measures to the most directly
comparable financial measures calculated in accordance with GAAP are set forth
below. The non-GAAP measures presented are not measures of performance under
GAAP and should not be considered as alternatives for the most directly
comparable financial measures calculated in accordance with GAAP. Other
companies in our industry may define these non-GAAP measures differently than
we do and, as a result, these non-GAAP measures may not be comparable to
similarly titled measures used by other companies in our industry. In
addition,certain of our non-GAAP financial measures exclude financial
information that some may consider important in evaluating our performance.
Given the inherent uncertainty regarding special items and other expense in
any future period, a reconciliation of forward-looking financial measures to
the most directly comparable financial measures calculated and presented in
accordance with GAAP is not feasible. The magnitude of these items, however,
may be significant.

Forward-Looking Statements and Risk Factors

This press release contains statements which constitute forward-looking
statements, within the meaning of the Private Securities Litigation Reform Act
of 1995, including but not limited to statements regarding the company's
projected revenue, Adjusted EBITDA, free cash flow, earnings, financial
results and its future sales growth outlook. The forward-looking statements
can be identified by words such as "anticipate," "believe," "plan,"
"estimate," "expect," "intend," "project," "target," and other similar
expressions. Forward-looking statements are made as of the date of this press
release and are based upon management's current expectations and beliefs
concerning future developments and their potential effects on us. Such
forward-looking statements are not guarantees of future performance. The
following important factors, as well as risk factors described in our reports
filed with the SEC, could cause our actual results to differ materially from
estimates or expectations reflected in such forward-looking statements:

  oautomobile production volumes;
  othe financial condition of our customers and suppliers;
  oour ability to make scheduled payments on our indebtedness and comply with
    the covenants and restrictions contained in the instruments governing our
    indebtedness;
  oour ability to refinance our indebtedness;
  oour ability to generate non-automotive revenues;
  orisks associated with our non-U.S.operations, including foreign exchange
    risks and economic uncertainty in some regions;
  oany increase in the expense and funding requirements of our pension and
    other postretirement benefits;
  oour customers' ability to obtain equity and debt financing for their
    businesses;
  oour dependence on our largest customers;
  opricing pressure from our customers;
  owork stoppages or other labor issues affecting us or our customers or
    suppliers; and
  ocosts or liabilities relating to environmental and safety regulations.

We do not assume any obligation to update or revise the forward-looking
statements contained in this press release.

Contact:
Derek Fiebig
Executive Director, Investor & External Relations
(248) 675-6457
fiebig.derek@towerautomotive.com



TOWER INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except share and per share amounts - unaudited)
                       Three Months Ended December   Year Ended December 31,
                       31,
                       2012           2011           2012         2011
Revenues               $         $         $         $   
                       508,144        516,862        2,084,914   2,053,708
Cost of sales          474,808        491,332        1,871,290    1,851,878
Gross profit           33,336         25,530         213,624      201,830
Selling, general and
administrative         32,768         37,519         134,019      151,553
expenses
Amortization expense   1,140          1,191          4,579        4,589
Restructuring and
asset impairment       2,785          514            10,738       2,660
charges, net
 Operating income     (3,357)        (13,694)       64,288       43,028
Interest expense       13,508         14,745         54,757       54,256
Interest income        111            199            942          749
Other expense          -              131            -            1,331
Income / (loss)
before provision for   (16,754)       (28,371)       10,473       (11,810)
income taxes
Provision / (benefit)  (2,458)        2,039          15,255       13,293
for income taxes
Loss from continuing   (14,296)       (30,410)       (4,782)      (25,103)
operations
Income from
discontinued           30,368         5,431          29,790       6,948
operations, net of
tax
 Net income /   16,072         (24,979)       25,008       (18,155)
(loss)
Less: Net income
attributable to the    2,349          1,072          6,976        5,109
noncontrolling
interests
Net income / (loss)    $        $         $       $     
attributable to Tower  13,723         (26,051)        18,032     (23,264)
International, Inc.
Weighted average
common shares
outstanding
Basic                  20,247,134     19,683,032     20,080,839   19,364,433
Diluted                20,411,868     19,683,032     20,447,072   19,364,433
Basic income/(loss) per share
attributable to Tower International,
Inc.:
Loss per share from    $        $        $       $     
continuing operations   (0.82)        (1.60)         (0.58)     (1.56)
Income per share from
discontinued           1.50           0.28           1.48         0.36
operations
Income/(loss) per      0.68           (1.32)         0.90         (1.20)
share
Diluted income/(loss) per share
attributable to Tower International,
Inc.:
Loss per share from    $        $        $       $     
continuing operations   (0.82)        (1.60)         (0.58)     (1.56)
Income per share from
discontinued           1.49           0.28           1.46         0.36
operations
Income/(loss) per      0.67           (1.32)         0.88         (1.20)
share



TOWER INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands, except share data - unaudited)
                                         December 31, 2012  December 31, 2011
                                                            (1)
ASSETS
Cash and cash equivalents                $          $        
                                          113,943          134,984
Accounts receivable, net of allowance    266,138            327,992
of $4,105 and $3,612
Inventories                              81,336             85,100
Deferred tax asset - current             10,447             12,966
Assets held for sale                     -                  4,027
Prepaid tooling, notes receivable, and   96,349             56,189
other
Total current assets                     568,213            621,258
Property, plant and equipment, net       573,148            667,686
Goodwill                                 64,793             63,983
Deferred tax asset - non-current         3,149              14,450
Other assets, net                        28,819             30,001
Total assets                             $          $        
                                         1,238,122          1,397,378
LIABILITIES AND STOCKHOLDERS' EQUITY
Short-term debt and current maturities   $          $        
of capital lease obligations               74,605         109,447
Accounts payable                         264,897            395,287
Accrued liabilities                      134,664            126,416
Total current liabilities                474,166            631,150
Long-term debt, net of current           411,590            461,838
maturities
Obligations under capital leases, net    10,783             12,213
of current maturities
Deferred tax liability - non-current     13,021             11,229
Pension liability                        100,780            96,223
Other non-current liabilities            86,908             87,265
Total non-current liabilities            623,082            668,768
 Total liabilities                      1,097,248          1,299,918
Stockholders' equity:
Tower International, Inc.'s
stockholders' equity
Common stock, $0.01 par value,
350,000,000 authorized, 20,830,425
issued and 20,247,134 outstanding at     208                200
December 31, 2012 and 19,983,403 issued
and 19,683,032 outstanding at December
31, 2011
Additional paid in capital               321,032            311,427
Treasury stock, at cost, 583,291 and
300,371 shares as of December 31, 2012   (8,297)            (5,130)
and 2011
Accumulated deficit                      (237,240)          (255,244)
Accumulated other comprehensive loss     (12,456)           (11,250)
Total Tower International, Inc.'s        63,247             40,003
stockholders' equity
Noncontrolling interests in              77,627             57,457
subsidiaries
Total stockholders' equity               140,874            97,460
Total liabilities and stockholders'      $          $        
equity                                   1,238,122          1,397,378
(1) Includes the results of our South Korean subsidiary
which was divested on December 28, 2012



TOWER INTERNATIONAL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in thousands - unaudited)
                     Three Months Ended          Year Ended
                     December 31,                December 31,
                     2012          2011          2012           2011
OPERATING
ACTIVITIES:
Net income / (loss)  $        $        $        $      
                       16,072     (24,979)    25,008       (18,155)
Less: income from
discontinued         30,368        5,431         29,790         6,948
operations, net of
tax
Loss from continuing (14,296)      (30,410)      (4,782)        (25,103)
operations
Adjustments required
to reconcile loss
from continuing
operations to net
cash provided by
operating
activities:
Non-cash
restructuring and    575           -             575            -
asset impairment
charges
Deferred income tax  (3,538)       144           9,052          (725)
provision
Depreciation and     24,643        22,152        92,856         102,583
amortization
Non-cash share-based 1,128         3,874         9,613          15,174
compensation
Pension expense, net 18,516        30,509        2,568          18,336
of contributions
Change in working
capital and other    36,576        39,685        (8,501)        (23,405)
operating items
Net cash provided by $        $        $        $      
continuing operating   63,604      65,954    101,381         86,860
activities
INVESTING
ACTIVITIES:
Cash disbursed for
purchases of         $        $        $         $     
property, plant and   (35,068)    (31,524)   (119,771)     (100,829)
equipment, net
Net assets acquired, -             -             -              (22,300)
net of cash acquired
Net cash used in     $        $        $         $     
continuing investing  (35,068)    (31,524)   (119,771)     (123,129)
activities
FINANCING
ACTIVITIES:
Proceeds from        $        $        $        $      
borrowings            186,520      176,834     651,781        654,420
Repayments of       (227,756)     (172,762)     (638,782)      (580,220)
borrowings
Retirement of senior -             (7,500)       -              (42,008)
secured notes
Purchase of treasury -             -             (3,167)        (5,130)
stock
Net cash provided by
/ (used in)          $        $        $        $      
continuing financing  (41,236)     (3,428)    9,832       27,062
activities
Discontinued
operations:
Net cash from        $        $        $        $      
discontinued            9,320     33,532    (10,616)       13,598
operating activities
Net cash from
discontinued         (29,474)      (5,960)       (51,352)       (19,580)
investing activities
Net cash from
discontinued         25,783        (19,935)      45,358         (763)
financing activities
Net cash from        $        $        $        $      
discontinued            5,629      7,637   (16,610)       (6,745)
operations
Effect of exchange   $        $        $        $      
rate changes on cash    2,044               4,127         591
and cash equivalents               (355)
NET CHANGE IN CASH   $        $        $        $      
AND CASH EQUIVALENTS   (5,027)    38,284    (21,041)      (15,361)
CASH AND CASH
EQUIVALENTS:
Beginning of period  $        $        $        $      
                      118,970       96,700    134,984        150,345
End of period        $        $        $        $      
                      113,943      134,984     113,943        134,984



TOWER INTERNATIONAL, INC. AND SUBSIDIARIES
SEGMENT DATA AND NON-GAAP FINANCIAL MEASURE RECONCILIATIONS
(Amounts in thousands - unaudited)
Segment Data             Three Months Ended December 31,
                         2012                      2011
                         Revenues     Adjusted     Revenues      Adjusted
                                      EBITDA                     EBITDA
International            $       $       $        $     
                          235,889     21,771   243,568      21,758
Americas                 272,255      21,603       273,294       24,991
Consolidated             $       $       $        $     
                          508,144     43,374   516,862      46,749
                         Year Ended December 31,
                         2012                      2011
                         Revenues     Adjusted     Revenues      Adjusted
                                      EBITDA                     EBITDA
International            $       $       $        $     
                          945,905     85,423   981,652      96,481
Americas                 1,139,009    108,276      1,072,056     104,681
Consolidated             $       $       $        $     
                         2,084,914     193,699   2,053,708      201,162
Adjusted EBITDA          Three Months Ended        Year Ended December 31,
reconciliation           December 31,
                         2012         2011         2012          2011
Adjusted EBITDA          $       $       $        $     
                           43,374    46,749   193,699     201,162
Restructuring            (2,785)      (514)        (10,738)      (2,660)
Depreciation and         (24,643)     (22,152)     (92,856)      (102,583)
amortization
Acquisition costs and    (146)        (109)        (431)         (1,554)
other
Expense related to the   -            (4,445)      (6,229)       (18,114)
compensation programs
Interest expense, net    (13,397)     (14,546)     (53,815)      (53,507)
Other expense            -            (131)        -             (1,331)
(Provision) / benefit    2,458        (2,039)      (15,255)      (13,293)
for income taxes
Net income attributable
to noncontrolling        (2,349)      (1,072)      (6,976)       (5,109)
interests
Pension actuarial loss   (19,157)     (33,223)     (19,157)      (33,223)
Income from
discontinued             30,368       5,431        29,790        6,948
operations, net of tax
Net income / (loss)      $       $       $        $     
attributable to Tower      13,723   (26,051)    18,032    (23,264)
International, Inc.
Free cash flow           Three Months Ended        Year Ended December 31,
reconciliation           December 31,
                         2012         2011         2012          2011
Net cash provided by     $       $       $        $     
operating activities       63,604    65,954   101,381      86,860
Cash disbursed for       (35,068)     (31,524)     (119,771)     (100,829)
purchases of PP&E, net
Free cash flow           $       $       $        $     
                           28,536    34,430   (18,390)    (13,969)
Net debt reconciliation                            December 31,  December 31,
                                                   2012          2011
Short-term debt and
current maturities of                              $        $     
capital lease                                        74,605    109,447
obligations
Long-term debt, net of                             411,590       461,838
current maturities
Obligations under
capital leases, net of                             10,783        12,213
current maturities
Total debt                                         496,978       583,498
Less: cash and cash                                (113,943)     (134,984)
equivalents
Net debt                                           $        $     
                                                    383,035     448,514



TOWER INTERNATIONAL, INC. AND SUBSIDIARIES
CERTAIN ITEMS INCLUDED IN NET INCOME / (LOSS)
(Amounts in thousands, except per share amounts - unaudited)
                         Three Months Ended          Year Ended
                         December 31,                December 31,
                         2012           2011         2012         2011
Income / (expense)
items included in net
income / (loss), net
of tax:
Selling, general and
administrative
expenses
Incentive                $         $          $          $ 
compensation related       -          (4,305)     (6,105)     (17,341)
to funding events
Pension actuarial        (19,157)       (33,223)     (19,157)     (33,223)
loss
Acquisition costs        -              -            -            (1,100)
Interest expense
Acceleration of the
amortization of debt     -              (302)        -            (1,760)
issue costs and OID
Settlement of value
added tax audit in       -              -            -            2,838
Brazil
Restructuring expense
Severance costs in       (515)          -            (1,718)      -
Europe
One-time
restructuring actions    (1,048)        -            (1,048)      -
in North America
Plant relocation         (170)          -            (3,041)      -
costs
Asset impairments        -              -            (575)        -
Adjustment of lease      -              -            -            754
liability
Other items
Partial retirement of    -              (131)        -            (1,331)
senior secured notes
Provision for income
taxes
Tax audits and other     3,252          -            4,339        -
adjustments
Valuation allowance      -              -            (6,494)      -
in Brazil
Tax law and tax          -              -            -            1,406
election changes
Discontinued
operations
Income from
discontinued             30,368         5,431        29,790       6,948
operations
Total items included                    $           $          $ 
in net income /          $   12,730   (32,530)    (4,009)     (42,809)
(loss)
Net income                              $           $          $ 
attributable to Tower    $   13,723   (26,051)    18,032       (23,264)
International, Inc.
Memo: Average shares
outstanding (in
thousands)
Basic                    20,247         19,683       20,081       19,364
Diluted                  20,412         19,683       20,447       19,364
Loss per common share
(GAAP)
Basic                    $          $         $        $   
                         0.68           (1.32)      0.90         (1.20)
Diluted                  0.67           (1.32)       0.88         (1.20)
Diluted adjusted
income per share         0.05           0.32         1.08         0.97
(non-GAAP)*
* Excludes the certain items shown above. For the quarter ended December 31,
2011 and year ended December 31, 2011, diluted share count of 20.2 million
and 20.1 million, respectively, were used to calculate diluted adjusted
income per share.



SOURCE Tower International, Inc.

Website: http://www.towerinternational.com
 
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