Company Achieves 7.5% Growth in the
Packaging Segment in Fourth Quarter
TriMas (NASDAQ: TRS) today announced financial results for the
fourth quarter and full year ended December 31, 2023.
TriMas Highlights
- Achieved quarterly net sales of $209.6 million, or growth of
3.1%, as compared to the prior year quarter
- Increased net sales within TriMas' Packaging and Aerospace
groups by 7.5% and 26.1%, respectively, as compared to fourth
quarter 2022
- Initiated a sale process for Arrow Engine, which when
completed, would facilitate the Company's exit from the oil and gas
end market
- Delivered an approximate 2.2% return of capital to shareholders
through share buybacks and dividends in 2023
"As we concluded 2023, we were pleased by the ongoing upward
trend in our order intake, sales and conversion within our TriMas
Aerospace group, and also by our TriMas Packaging group's gains in
order intake momentum," said Thomas Amato, TriMas President and
Chief Executive Officer. "While this positive momentum in our two
largest segments was encouraging, demand in our Specialty Products
businesses softened well beyond our expectations, as customers
postponed their capital expenditure purchases to rebalance
inventory levels toward year end."
"Although we encountered a challenging macro demand environment
in 2023, our intense focus on cost management and operational
improvements establishes a promising foundation for 2024. We
addressed many of the critical sub-supply constraints to meet
heightened demand in TriMas Aerospace, and rationalized our
manufacturing and distribution footprint in TriMas Packaging.
Throughout the year, we also continued to invest in the
capabilities essential for our future growth, prioritizing
innovation, sustainable solutions and digital transformation."
"Looking ahead to 2024 and beyond, we believe that TriMas’
strong balance sheet and cash generation will consistently afford
us opportunities to invest in organic growth, pursue bolt-on
acquisitions, pay a dividend and repurchase shares. We are
dedicated to delivering long-term value for our shareholders, and
remain confident in the strength of our market positions and
underlying businesses," concluded Amato.
Fourth Quarter 2023
TriMas reported fourth quarter 2023 net sales of $209.6 million,
an increase of 3.1% compared to $203.3 million in fourth quarter
2022, as organic growth in aerospace and defense, and certain
packaging product lines, as well as acquisition-related sales, more
than offset lower market demand for products used in certain
industrial, and oil and gas applications. The Company reported
operating profit of $11.6 million in fourth quarter 2023 compared
to $26.3 million in fourth quarter 2022. Adjusting for Special
Items(1), fourth quarter 2023 adjusted operating profit was $18.8
million compared to $36.3 million in the prior year period, as the
favorable impacts of higher sales, operational efficiencies and
costs savings gains in fourth quarter 2023 were more than offset by
the $17.6 million pre-tax gain related to the non-core property
divestiture in fourth quarter 2022 that did not repeat. Further
adjusting for the fourth quarter 2022 property sale gain, fourth
quarter 2023 adjusted operating profit would have been relatively
flat on a comparable basis.
The Company reported fourth quarter 2023 net income of $7.9
million, or $0.19 per diluted share, compared to $18.8 million, or
$0.45 per diluted share, in fourth quarter 2022. Adjusting for
Special Items(1), fourth quarter 2023 adjusted net income(2) was
$12.3 million compared to $22.9 million in the prior year period.
Fourth quarter 2023 adjusted diluted earnings per share(2) was
$0.37 compared to $0.62 in the prior year period. The
year-over-year decline was primarily related to the fourth quarter
2022 property divestiture gain that did not repeat in fourth
quarter 2023. Further adjusting for the fourth quarter 2022
property sale gain, fourth quarter 2023 adjusted diluted earnings
per share(2) would have increased by $0.05, as compared to the
prior year quarter.
Full Year 2023
For full year 2023, TriMas reported net sales of $893.6 million,
an increase of 1.1% compared to $883.8 million in 2022, as organic
sales growth in TriMas' Aerospace and Specialty Products groups,
and acquisition-related sales, more than offset the lower market
demand for certain TriMas Packaging products, primarily used in
personal care, food and industrial applications. The Company
reported operating profit of $65.4 million in 2023, as compared to
$99.1 million in 2022. Adjusting for Special Items(1), 2023
adjusted operating profit was $89.5 million compared to $116.2
million in the prior year, primarily as a result of a less
favorable sales mix, supply and labor constraints, and the 2022
impact of more than $22.4 million of pre-tax property divestiture
gains that did not repeat in 2023. Further adjusting for the 2022
property sale gains, 2023 adjusted operating profit would have
decreased by 4.6% on a comparable basis.
The Company reported full year 2023 net income of $40.4 million,
or $0.97 per diluted share, compared to $66.2 million, or $1.56 per
diluted share, in 2022. Full year 2023 adjusted net income(2) was
$59.1 million compared to $75.9 million in 2022, and adjusted
diluted earnings per share(2) was $1.74. For full year 2022, TriMas
reported adjusted diluted earnings per share(2) of $2.12, which
benefited by $0.39 per share from the property divestiture gains
that did not repeat in 2023. Further adjusting for the 2022
property sale gains, 2023 adjusted diluted earnings per share(2)
would have increased slightly, as compared to 2022.
Financial Position
During 2023, the Company used $77.3 million for acquisitions and
repurchased 680,594 shares of its outstanding common stock for
$18.8 million, further reducing net shares outstanding by
approximately 1.3%. TriMas also paid a quarterly cash dividend of
$0.04 per share of TriMas Corporation stock. In total, the Company
provided an approximate return of capital to its shareholders of
2.2% between share buybacks and quarterly dividends in 2023.
TriMas ended 2023 with $34.9 million of cash on hand, $291.8
million of cash and available borrowing capacity under its
revolving credit facility, and a net leverage ratio of 2.4x as
defined in the Company's credit agreement. As of December 31, 2023,
TriMas reported total debt of $395.7 million and Net Debt(3) of
$360.8 million. The Company continues to maintain a strong balance
sheet and remains committed to its capital allocation strategy of
investing in its businesses, returning capital to shareholders
through both share buybacks and dividends, and augmenting organic
growth through programmatic bolt-on acquisitions.
The Company reported net cash provided by operating activities
of $30.6 million for fourth quarter 2023, compared to $25.9 million
in fourth quarter 2022. On a full year basis, TriMas reported net
cash provided by operating activities of $88.2 million, compared to
$72.6 million for 2022. As a result, the Company reported Free Cash
Flow(4) of $14.7 million for fourth quarter 2023 compared to $14.2
million in fourth quarter 2022. For 2023, TriMas reported Free Cash
Flow(4) of $47.8 million compared to $43.1 million in 2022. Please
see Appendix I for further details.
Fourth Quarter Segment
Results
TriMas Packaging group's net sales for the fourth quarter were
$113.6 million, an increase of 7.5% compared to the year ago
period, as organic growth within the life sciences, and beauty and
personal care end markets, and sales from a recent acquisition,
more than offset the continued soft demand in certain closure
products, primarily in food and beverage-related applications.
Fourth quarter operating profit declined as a result of
restructuring costs during the quarter to streamline and position
the business for future operating leverage gains. Adjusting for
Special Items(1), fourth quarter 2023 operating profit increased,
primarily as a result of sales increases, structural cost
reductions and other cost savings actions. The Company continues to
actively engage with its customers to evaluate longer-term demand
requirements as order intake begins to build momentum, while
continuing to drive cost improvement actions to better position
TriMas Packaging for operating gains as demand recovers.
TriMas Aerospace group's net sales for the fourth quarter were
$64.0 million, an increase of 26.1% compared to the year ago
period, primarily driven by increased aerospace production demand,
reduced production constraints and acquisition-related sales.
Fourth quarter operating profit and the related margin increased,
primarily due to operational excellence initiatives and related
higher conversion rates. The Company is focused on continuing to
invest in operational excellence improvements and the addition of
skilled labor to further enhance conversion on higher demand in
2024.
TriMas Specialty Products group's net sales for the fourth
quarter were $32.0 million, a decrease of 31.8% compared to the
year ago period, a decline well beyond anticipated, as most
industrial customers deferred capital expenditure purchases to
rebalance inventories toward the end of the year. Fourth quarter
operating profit and the related margin level decreased, as a
result of lower sales and related lower absorption. In addition,
the Company has initiated a sales process for its Arrow Engine
business, which when successfully completed, would facilitate an
exit of its presence in the oil and gas end market.
Outlook
The Company expects TriMas' 2024 consolidated sales to increase
5% to 8% compared to 2023. The Company expects full year 2024
adjusted diluted earnings per share(2) to be between $1.95 to $2.15
per share. Effective as of the first quarter of 2024, the Company
will be adding back non-cash compensation expense to its adjusted
diluted earnings per share calculation.
"After a year of proactively managing through demand weakness in
the consumer goods and industrial markets within TriMas' Packaging
group, we anticipate the beginning of a gradual recovery within
both of these end markets in 2024, with consumer spending leading
the way in the early part of the year. We also anticipate that
demand in the aerospace and defense end market will continue to
remain strong in 2024. As we start the year, we remain optimistic
about our future prospects, and believe our strategy to deploy our
cash generation to augment TriMas' core growth with acquisitions
will continue to drive long-term value for our shareholders. We
continue to plan to opportunistically repurchase our shares given
our confidence in the outlook for our business and long-term
strategy," commented Amato.
The above outlook includes the impact of all announced
acquisitions. All of the above amounts considered as 2024 guidance
are after adjusting for any current or future amounts that may be
considered Special Items, and in the case of adjusted diluted
earnings per share, acquisition-related intangible asset
amortization expense for deals that have not yet been consummated.
The inability to predict the amount and timing of the impacts of
these Special Items makes a detailed reconciliation of these
forward-looking non-GAAP financial measures impracticable.(1)
Please see Appendix I for further details related to the
reconciliation of GAAP to non-GAAP financial measures, including
the reconciliation of diluted earnings per share (GAAP) to adjusted
diluted earnings per share for full year 2024 outlook.
Conference Call
Information
TriMas will host its fourth quarter and full year 2023 earnings
conference call today, Thursday, February 29, 2024, at 10:00 a.m.
ET. To participate via phone, please dial (877) 407-0890 (U.S. and
Canada) or +1 (201) 389-0918 (outside the U.S. and Canada) and ask
to be connected to the TriMas fourth quarter and full year 2023
earnings conference call. The conference call will also be
simultaneously webcast via TriMas' website at www.trimas.com, under the "Investors" section,
with an accompanying slide presentation. A replay of the conference
call will be available on the TriMas website or by dialing (877)
660-6853 (U.S. and Canada) or +1 (201) 612-7415 (outside the U.S.
and Canada) with a meeting ID of 13744326, beginning February 29,
2024 at 3:00 p.m. ET through March 14, 2024 at 3:00 p.m. ET.
Notice Regarding Forward-Looking
Statements
Any "forward-looking" statements, within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, contained herein, including those relating to
TriMas’ business, financial condition or future results, involve
risks and uncertainties with respect to, including, but not limited
to: general economic and currency conditions; competitive factors;
market demand; our ability to realize our business strategies; our
ability to identify attractive acquisition candidates, successfully
integrate acquired operations or realize the intended benefits of
such acquisitions; pressures on our supply chain, including
availability of raw materials and inflationary pressures on raw
material and energy costs, and customers; the performance of our
subcontractors and suppliers; risks and uncertainties associated
with intangible assets, including goodwill or other intangible
asset impairment charges; risks associated with a concentrated
customer base; information technology and other cyber-related
risks; risks related to our international operations, including,
but not limited to, risks relating to tensions between the United
States and China; government and regulatory actions, including,
without limitation, climate change legislation and other
environmental regulations, as well as the impact of tariffs, quotas
and surcharges; changes to fiscal and tax policies; intellectual
property factors; uncertainties associated with our ability to meet
customers’ and suppliers’ sustainability and environmental, social
and governance (“ESG”) goals and achieve our sustainability and ESG
goals in alignment with our own announced targets; litigation;
contingent liabilities relating to acquisition activities; interest
rate volatility; our leverage; liabilities imposed by our debt
instruments; labor disputes and shortages; the disruption of
operations from catastrophic or extraordinary events, including,
but not limited to, natural disasters, geopolitical conflicts and
public health crises, the amount and timing of future dividends
and/or share repurchases, which remain subject to Board approval
and depend on market and other conditions; our future prospects;
our ability to successfully complete the sale of our Arrow Engine
business; and other risks that are detailed in the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 2023.
The risks described are not the only risks facing our Company.
Additional risks and uncertainties not currently known to us or
that we currently deemed to be immaterial also may materially
adversely affect our business, financial position and results of
operations or cash flows. These risks and uncertainties may cause
actual results to differ materially from those indicated by the
forward-looking statements. All forward-looking statements made
herein are based on information currently available, and the
Company assumes no obligation to update any forward-looking
statements, except as required by law.
Non-GAAP Financial
Measures
In this release, certain non-GAAP financial measures are used.
Reconciliations of these non-GAAP financial measures to the most
directly comparable GAAP financial measure may be found in Appendix
I at the end of this release. Management believes that presenting
these non-GAAP financial measures provides useful information to
investors by helping them identify underlying trends in the
Company’s businesses and facilitating comparisons of performance
with prior and future periods and to the Company’s peers. These
non-GAAP financial measures should be considered in addition to,
and not as a replacement for or superior to, the comparable GAAP
measure, and may not be comparable to similarly titled measures
reported by other companies.
Reconciliations of forward-looking non-GAAP financial measures
to the most directly comparable GAAP financial measures are
provided only for the expected impact of amortization of
acquisition-related intangible assets for completed acquisitions,
as the Company is unable to provide estimates of future Special
Items(1) or amortization from future acquisitions without
unreasonable effort, due to the uncertainty and inherent difficulty
of predicting the occurrence and the financial impact of such items
impacting comparability and the periods in which such items may be
recognized. For the same reasons, the Company is unable to address
the probable significance of the unavailable information, which
could be material to future results.
Additional information is available at www.trimas.com under the “Investors” section.
(1)
Appendix I details certain costs,
expenses and other amounts or charges, collectively described as
"Special Items," that are included in the determination of net
income, earnings per share and/or cash flows from operating
activities under GAAP, but that management believes should be
separately considered when evaluating the quality of the Company’s
core operating results, given they may not reflect the ongoing
activities of the business.
(2)
The Company defines adjusted
diluted earnings per share as net income (per GAAP), plus or minus
the after-tax impact of Special Items(1), plus the after-tax impact
of non-cash acquisition-related intangible asset amortization
expense. While the acquisition-related intangible assets aid in the
Company’s revenue generation, the Company adjusts for the non-cash
amortization expense because the Company believes it (i) enhances
management’s and investors’ ability to analyze underlying business
performance, (ii) facilitates comparisons of financial results over
multiple periods, and (iii) provides more relevant comparisons of
financial results with the results of other companies as the
amortization expense associated with these assets may fluctuate
significantly from period to period based on the timing, size,
nature, and number of acquisitions.
(3)
The Company defines Net Debt as
Total Debt less Cash and Cash Equivalents. Please see Appendix I
for additional details.
(4)
The Company defines Free Cash
Flow as Net Cash Provided by/Used for Operating Activities,
excluding the cash impact of Special Items, less Capital
Expenditures. Please see Appendix I for additional details.
About TriMas
TriMas manufactures a diverse set of products primarily for the
consumer products, aerospace and industrial markets through its
TriMas Packaging, TriMas Aerospace and Specialty Products groups.
Our approximately 3,400 dedicated employees in 13 countries provide
customers with a wide range of innovative and quality product
solutions through our market-leading businesses. Our TriMas family
of businesses has strong brand names in the markets served, and
operates under a common set of values and strategic priorities
under the TriMas Business Model. TriMas is publicly traded on the
NASDAQ under the ticker symbol “TRS,” and is headquartered in
Bloomfield Hills, Michigan. For more information, please visit
www.trimas.com.
TriMas Corporation
Condensed Consolidated Balance
Sheet
(Dollars in thousands)
December 31,
2023
December 31,
2022
Assets
Current assets:
Cash and cash equivalents
$
34,890
$
112,090
Receivables, net
148,030
132,370
Inventories
192,450
163,360
Prepaid expenses and other current
assets
22,010
14,840
Total current assets
397,380
422,660
Property and equipment, net
329,990
277,750
Operating lease right-of-use assets
43,220
47,280
Goodwill
363,770
339,810
Other intangibles, net
181,020
188,110
Deferred income taxes
10,230
9,400
Other assets
16,050
19,990
Total assets
$
1,341,660
$
1,305,000
Liabilities and Shareholders'
Equity
Current liabilities:
Accounts payable
$
91,910
$
85,210
Accrued liabilities
59,640
46,660
Lease liabilities, current portion
7,900
8,280
Total current liabilities
159,450
140,150
Long-term debt, net
395,660
394,730
Lease liabilities
39,690
41,010
Deferred income taxes
23,290
20,940
Other long-term liabilities
40,620
56,340
Total liabilities
658,710
653,170
Total shareholders' equity
682,950
651,830
Total liabilities and shareholders'
equity
$
1,341,660
$
1,305,000
TriMas Corporation
Consolidated Statement of
Income
(Dollars in thousands, except
share and per share amounts)
Three months ended
December 31,
Twelve months ended
December 31,
2023
2022
2023
2022
(unaudited)
Net sales
$
209,560
$
203,310
$
893,550
$
883,830
Cost of sales
(166,390
)
(157,730
)
(692,230
)
(675,530
)
Gross profit
43,170
45,580
201,320
208,300
Selling, general and administrative
expenses
(30,170
)
(36,710
)
(134,580
)
(131,190
)
Net gain (loss) on dispositions of
assets
(250
)
17,410
(180
)
21,950
Impairment of indefinite-lived intangible
assets
(1,120
)
—
(1,120
)
—
Operating profit
11,630
26,280
65,440
99,060
Other expense, net:
Interest expense
(4,300
)
(3,600
)
(15,920
)
(14,110
)
Other income (expense), net
1,100
1,870
1,070
2,720
Other expense, net
(3,200
)
(1,730
)
(14,850
)
(11,390
)
Income before income tax expense
8,430
24,550
50,590
87,670
Income tax expense
(490
)
(5,710
)
(10,230
)
(21,500
)
Net income
$
7,940
$
18,840
$
40,360
$
66,170
Basic earnings per share:
Net income per share
$
0.19
$
0.45
$
0.97
$
1.57
Weighted average common shares - basic
41,324,822
41,905,216
41,439,027
42,249,244
Diluted earnings per share:
Net income per share
$
0.19
$
0.45
$
0.97
$
1.56
Weighted average common shares -
diluted
41,620,790
42,139,729
41,685,348
42,478,015
TriMas Corporation
Consolidated Statement of Cash
Flows
(Dollars in thousands)
Twelve months ended
December 31,
2023
2022
Cash Flows from Operating
Activities:
Net income
$
40,360
$
66,170
Adjustments to reconcile income to net
cash provided by operating activities, net of acquisition
impact:
Impairment of indefinite-lived intangible
assets
1,120
—
(Gain) loss on dispositions of assets
180
(21,950
)
Depreciation
39,410
34,120
Amortization of intangible assets
18,180
19,100
Amortization of debt issue costs
930
910
Deferred income taxes
(1,710
)
(1,400
)
Non-cash compensation expense
9,670
9,840
Provision for losses on accounts
receivable
2,450
—
Change in legacy liability estimate
—
5,590
Increase in receivables
(5,520
)
(6,650
)
Increase in inventories
(7,070
)
(6,970
)
Decrease in prepaid expenses and other
assets
4,760
6,120
Decrease in accounts payable and accrued
liabilities
(14,520
)
(29,130
)
Other operating activities
(80
)
(3,180
)
Net cash provided by operating
activities
88,160
72,570
Cash Flows from Investing
Activities:
Capital expenditures
(54,190
)
(45,960
)
Acquisition of businesses, net of cash
acquired
(77,340
)
(64,100
)
Cross-currency swap terminations
(3,370
)
26,230
Net proceeds from dispositions of property
and equipment
480
28,790
Net cash used for investing activities
(134,420
)
(55,040
)
Cash Flows from Financing
Activities:
Proceeds from borrowings on revolving
credit facilities
117,990
12,000
Repayments of borrowings on revolving
credit facilities
(117,430
)
(12,000
)
Payments to purchase common stock
(18,780
)
(36,920
)
Shares surrendered upon exercise and
vesting of equity awards to cover taxes
(2,700
)
(2,380
)
Dividends paid
(6,700
)
(6,880
)
Other financing activities
(3,320
)
—
Net cash used for financing activities
(30,940
)
(46,180
)
Cash and Cash Equivalents:
Decrease for the year
(77,200
)
(28,650
)
At beginning of year
112,090
140,740
At end of year
$
34,890
$
112,090
Supplemental disclosure of cash flow
information:
Cash paid for interest
$
14,320
$
12,960
Cash paid for income taxes
$
16,770
$
20,060
Appendix I
TriMas Corporation
Additional Information
Regarding Special Items Impacting
Reported GAAP Financial
Measures
(Unaudited - dollars in
thousands)
Three months ended
December 31,
Twelve months ended
December 31,
2023
2022
2023
2022
Packaging
Net sales
$
113,560
$
105,640
$
463,600
$
522,180
Operating profit
$
12,000
$
14,280
$
60,140
$
81,000
Special Items to consider in evaluating
operating profit:
Purchase accounting costs
—
—
800
760
Business restructuring and severance
costs
4,190
840
11,910
4,440
Adjusted operating profit
$
16,190
$
15,120
$
72,850
$
86,200
Aerospace
Net sales
$
64,030
$
50,760
$
241,400
$
188,090
Operating profit (loss)
$
4,330
$
(1,240
)
$
15,520
$
8,060
Special Items to consider in evaluating
operating profit:
Impairment of indefinite-lived intangible
assets
1,120
—
1,120
—
Business restructuring and severance
costs
210
2,660
500
3,420
Purchase accounting costs
400
—
2,390
400
Adjusted operating profit
$
6,060
$
1,420
$
19,530
$
11,880
Specialty Products
Net sales
$
31,970
$
46,910
$
188,550
$
173,560
Operating profit
$
4,040
$
9,480
$
36,400
$
30,250
Special Items to consider in evaluating
operating profit:
Business restructuring and severance
costs
—
—
190
—
Adjusted operating profit
$
4,040
$
9,480
$
36,590
$
30,250
Corporate Expenses
Operating profit (loss)
$
(8,740
)
$
3,760
$
(46,620
)
$
(20,250
)
Special Items to consider in evaluating
operating profit (loss):
Change in legacy liability estimate for
asbestos-related costs
—
5,590
—
5,590
M&A diligence and transaction
costs
300
900
2,230
2,050
Business restructuring and severance
costs
240
—
4,190
510
ERP Implementation costs
$
680
$
—
$
680
$
—
Adjusted operating profit (loss)
$
(7,520
)
$
10,250
$
(39,520
)
$
(12,100
)
Total Company
Net sales
$
209,560
$
203,310
$
893,550
$
883,830
Operating profit
$
11,630
$
26,280
$
65,440
$
99,060
Total Special Items to consider in
evaluating operating profit
7,140
9,990
24,010
17,170
Adjusted operating profit
$
18,770
$
36,270
$
89,450
$
116,230
Property divestiture gains
$
—
$
(17,610
)
$
—
$
(22,450
)
Further adjusted operating profit
$
18,770
$
18,660
$
89,450
$
93,780
Appendix I
TriMas Corporation
Additional Information
Regarding Special Items Impacting
Reported GAAP Financial
Measures
(Unaudited - dollars in
thousands, except share and per share amounts)
Three months ended
December 31,
Twelve months ended
December 31,
2023
2022
2023
2022
Net income, as reported
$
7,940
$
18,840
$
40,360
$
66,170
Special Items to consider in evaluating
quality of net income:
Impairment of indefinite-lived intangible
assets
1,120
—
1,120
—
Change in legacy liability estimate for
asbestos-related costs
—
5,590
—
5,590
Business restructuring and severance
costs
4,640
3,500
16,790
8,520
M&A diligence and transaction
costs
300
900
2,230
2,050
Purchase accounting costs
400
—
3,190
1,160
Reversal of a contingent deferred purchase
price liability
—
(3,560
)
—
(3,560
)
Defined benefit pension plan settlement
charge
—
—
640
—
Foreign exchange forward charge
(220
)
—
140
—
ERP Implementation costs
680
—
680
—
Income tax effect of Special Items (1)
(2,580
)
(2,350
)
(6,100
)
(4,060
)
Adjusted net income
$
12,280
$
22,920
$
59,050
$
75,870
Pre-tax property divestiture gains
—
(17,610
)
—
(22,450
)
Income tax expense on property divestiture
gains (1)
—
4,870
—
6,070
Further adjusted net income
$
12,280
$
10,180
$
59,050
$
59,490
Three months ended
December 31,
Twelve months ended
December 31,
2023
2022
2023
2022
Diluted earnings per share, as
reported
$
0.19
$
0.45
$
0.97
$
1.56
Special Items to consider in evaluating
quality of EPS:
Impairment of indefinite-lived intangible
assets
0.03
—
0.03
—
Change in legacy liability estimate for
asbestos-related costs
—
0.13
—
0.13
Business restructuring and severance
costs
0.10
0.08
0.40
0.20
M&A diligence and transaction
costs
0.01
0.02
0.05
0.05
Purchase accounting costs
0.01
—
0.07
0.03
Reversal of a contingent deferred purchase
price liability
—
(0.08
)
—
(0.08
)
Defined benefit pension plan settlement
charge
—
—
0.02
—
Foreign exchange forward charge
(0.01
)
—
—
—
ERP Implementation costs
0.02
—
0.02
—
Income tax effect of Special Items (1)
(0.06
)
(0.06
)
(0.15
)
(0.10
)
Pre-tax amortization of
acquisition-related intangible assets
0.11
0.11
0.44
0.45
Income tax benefit on amortization of
acquisition-related intangible assets (1)
(0.03
)
(0.03
)
(0.11
)
(0.12
)
Adjusted diluted EPS
$
0.37
$
0.62
$
1.74
$
2.12
Pre-tax property divestiture gains
—
(0.42
)
—
(0.53
)
Income tax expense on property divestiture
gains (1)
—
0.12
—
0.14
Further adjusted diluted EPS
$
0.37
$
0.32
$
1.74
$
1.73
Weighted-average shares
outstanding
41,620,790
42,139,729
41,685,348
42,478,015
(1)
Income tax effect calculated on
an item-by-item basis, utilizing the statutory tax rate in the
jurisdiction where the adjustments occurred. For the three and
twelve month periods ended December 31, 2023 and 2022, the income
tax effect of Special Items varied from the tax rate inherent in
the Company's reported GAAP results, primarily as a result of
certain discrete items that occurred during the period for GAAP
reporting purposes.
Appendix I
TriMas Corporation
Additional Information
Regarding Special Items Impacting
Reported GAAP Financial
Measures
(Unaudited - dollars in
thousands)
Three months ended December
31,
2023
2022
As reported
Special Items
As adjusted
As reported
Special Items
As adjusted
Net cash provided by operating
activities
$
30,590
$
3,370
$
33,960
$
25,930
$
2,390
$
28,320
Less: Capital expenditures
(19,250
)
—
(19,250
)
(14,120
)
—
(14,120
)
Free Cash Flow
11,340
3,370
14,710
11,810
2,390
14,200
Net income
7,940
4,340
12,280
18,840
4,080
22,920
Free Cash Flow as a percentage of net
income
143
%
120
%
63
%
62
%
Twelve months ended December
31,
2023
2022
As reported
Special Items
As adjusted
As reported
Special Items
As adjusted
Net cash provided by operating
activities
$
88,160
$
13,800
$
101,960
72,570
$
16,480
$
89,050
Less: Capital expenditures
(54,190
)
—
(54,190
)
(45,960
)
—
(45,960
)
Free Cash Flow
33,970
13,800
47,770
26,610
16,480
43,090
Net income
40,360
18,690
59,050
66,170
9,700
75,870
Free Cash Flow as a percentage of net
income
84
%
81
%
40
%
57
%
December 31,
2023
December 31,
2022
Long-term debt, net
$
395,660
$
394,730
Less: Cash and cash equivalents
34,890
112,090
Net Debt
$
360,770
$
282,640
Appendix I
TriMas Corporation
Reconciliation of GAAP to
Non-GAAP Financial Measures
Forecasted Diluted Earnings
Per Share Guidance
(Unaudited - dollars per
share)
Twelve months ended
December 31, 2024
Low
High
Diluted earnings per share (GAAP)
$
1.44
$
1.64
Pre-tax amortization of
acquisition-related intangible assets (1)
0.41
0.41
Income tax benefit on amortization of
acquisition-related intangible assets
(0.10
)
(0.10
)
Pre-tax non-cash compensation expense
(2)
0.27
0.27
Income tax benefit on non-cash
compensation expense
(0.07
)
(0.07
)
Impact of Special Items (3)
—
—
Adjusted diluted earnings per share
$
1.95
$
2.15
(1)
These amounts relate to
acquisitions announced as of February 29, 2024. The Company is
unable to provide forward-looking estimates of future acquisitions,
if any, that have not yet been consummated.
(2)
Effective first quarter 2024, the
Company will be modifying the definitions of adjusted net income by
adding back amortization of acquisition-related intangibles assets
and non-cash compensation expense and adjusted earnings per share
by adding back non-cash compensation expense. To provide historical
information on a basis consistent with this modification, the
Company has recast information for the quarterly periods and year
ended December 31, 2023 in Exhibit 99.2 of the Form 8-K filed
today.
(3)
The Company is unable to provide
forward-looking estimates of Special Items without unreasonable
effort, due to the uncertainty and inherent difficulty of
predicting the occurrence and the financial impact of such items
and the periods in which such items may be recognized. For the same
reasons, the Company is unable to address the probable significance
of the unavailable information, which could be material to future
results.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240229195618/en/
Sherry Lauderback VP, Investor Relations & Communications
(248) 631-5506 sherry.lauderback@trimas.com
TriMas (NASDAQ:TRS)
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