Cooper Standard Reports Fourth Quarter and Full Year 2018 Results
NOVI, Mich., Feb. 14, 2019 /PRNewswire/ -- Cooper-Standard Holdings Inc. (NYSE: CPS) today reported preliminary results for the fourth quarter and full year 2018.
Highlights
-- Full year net income totaled $107.8 million or $5.89 per fully diluted
share
-- Full year adjusted net income totaled $160.7 million or $8.79 per fully
diluted share
-- Full year adjusted EBITDA totaled $376.5 million, or 10.4 percent of
sales
-- Net new business awards totaled $64 million in the quarter and $441
million for the full year
-- Sales awards for innovation products totaled $70 million in the quarter
and $287 million for the full year
"Market conditions in Asia and Europe remained challenging during the fourth quarter and commodity costs continued to increase globally," stated Jeffrey Edwards, chairman and CEO, Cooper Standard. "While we anticipate similar headwinds in 2019, we are focused on executing our strategy to create value through innovation, improving operating efficiency and increasing returns on invested capital. Strong net new business awards in 2018 and a record number of new program launches planned for 2019, both in our automotive and non-automotive businesses, support our positive long-term outlook for profitable growth."
Consolidated Results*
Quarter Ended December 31, Year Ended December 31,
2018 2017 2018 2017
(dollar amounts in millions except per share amounts)
Sales $
872.0 $
937.9 $
3,629.3 $
3,618.1
Net income (loss) $
(23.1) $
28.5 $
107.8 $
135.3
Adjusted net income $
27.5 $
63.6 $
160.7 $
208.0
Earnings per diluted share $
(1.30) $
1.53 $
5.89 $
7.21
Adjusted earnings per diluted share $
1.53 $
3.42 $
8.79 $
11.08
Adjusted EBITDA $
76.4 $
131.2 $
376.5 $
452.0
The year-over-year change in fourth quarter sales was primarily attributable to unfavorable volume and mix, foreign exchange and customer price adjustments, partially offset by the net positive impact of acquisitions and divestitures. For the full year, favorable foreign exchange and the net positive impact of acquisitions and divestitures more than offset customer price adjustments and unfavorable volume and mix.
Net income for the fourth quarter and full year 2018 included the impact of non-cash impairment charges related to goodwill and other assets in the Company's Asia Pacific and Europe reporting units. It also included the tax benefit related to the reversal of the Company's valuation allowance on net deferred tax assets in France and on capital losses in the U.S. Adjusted net income, which excludes these and other special or non-operating items, was down in the fourth quarter and full year 2018 due largely to unfavorable volume and mix, customer price adjustments, higher material costs and general inflation, partially offset by operating efficiencies, lower sales, general, administrative and engineering (SGA&E) expense, and the lower statutory tax rate in the U.S.
The year-over-year change in fourth quarter and full year adjusted EBITDA is largely attributable to unfavorable volume and mix, customer price adjustments, higher raw material costs and general inflation, partially offset by operating efficiencies and lower SGA&E expense.
Adjusted net income, adjusted EBITDA and adjusted earnings per diluted share are non-GAAP measures. Reconciliations to the most directly comparable financial measures, calculated and presented in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"), are provided in the attached supplemental schedules.
Notable Developments
During the fourth quarter, Cooper Standard launched 56 new customer programs and was awarded $64 million in annual net new business. For the full year 2018, the Company's annual net new business awards totaled $441 million. New contract awards related to the Company's recent product innovations, including both new and replacement business, totaled $70 million for the quarter. Cooper Standard's expanding portfolio of commercialized innovation products includes: MagAlloy(TM); ArmorHose(TM); ArmorHose(TM) TPV; Gen III Posi-Lock(TM); TP Microdense; and Fortrex(TM).
During the fourth quarter, the Company announced an agreement to sell its anti-vibration systems business and the divestiture is expected to close early in the second quarter of 2019, subject to customary closing conditions.
Quarterly Segment Results
North America
Cooper Standard's North America segment reported sales of $476.4 million in the fourth quarter of 2018 compared to $479.4 million in the fourth quarter of 2017. The change was primarily attributable to unfavorable volume and mix and customer price adjustments, offset by incremental sales related to acquisitions.
North America segment profit was $51.3 million in the fourth quarter of 2018 compared to $65.2 million in the fourth quarter of 2017. The year-over-year change was primarily attributable to unfavorable volume and mix, higher material costs, customer price adjustments and inflation, partially offset by improvements in operating efficiency, lower compensation-related expense and other cost reduction initiatives.
Europe
Cooper Standard's Europe segment reported sales of $230.2 million in the fourth quarter of 2018 compared to $267.4 million in the fourth quarter of 2017. The change was attributable to unfavorable volume and mix, customer price adjustments and foreign exchange.
The Europe segment reported a segment loss of $57.2 million in the fourth quarter of 2018, compared to a segment profit of $1.8 million in the fourth quarter of 2017. The year-over-year change was largely attributable to $41.5 million of non-cash impairment charges related to goodwill, fixed assets and other intangible assets, unfavorable volume and mix, customer price adjustments, higher material costs and general inflation, partially offset by savings related to restructuring and other cost reduction initiatives.
Asia Pacific
Cooper Standard's Asia Pacific segment reported sales of $143.1 million in the fourth quarter of 2018 compared to $163.2 million in the fourth quarter of 2017. The change was largely attributable to unfavorable volume and mix, customer price adjustments and foreign exchange, partially offset by incremental sales related to acquisitions.
The Asia Pacific segment reported a segment loss of $68.6 million in the fourth quarter of 2018, compared to a segment loss of $1.1 million in the fourth quarter 2017. The year-over-year change was primarily attributable to $38.9 million of non-cash impairment charges related to goodwill and fixed assets in India and Korea, unfavorable volume and mix, customer price adjustments and inflation, partially offset by improvements in operating efficiency, savings related to restructuring and lower compensation-related expense.
South America
Cooper Standard's South America segment reported sales of $22.3 million in the fourth quarter of 2018 compared to $27.9 million in the fourth quarter of 2017. The change was primarily attributable to foreign exchange and unfavorable volume and mix.
The South America segment reported a segment loss of $3.7 million in the fourth quarter of 2018 compared to a loss of $2.6 million in the fourth quarter of 2017. The year-over-year change was primarily attributable to higher material costs.
Liquidity and Cash Flow
At December 31, 2018, Cooper Standard had cash and cash equivalents totaling $265.0 million. Net cash provided by operating activities in the fourth quarter 2018 was $71.4 million compared to $208.0 million in the fourth quarter of 2017. Free cash flow (defined as net cash provided by operating activities minus capital expenditures) was $13.4 million in the fourth quarter of 2018 compared to $158.7 million in the fourth quarter of 2017. For the full year 2018, net cash provided by operating activities was $149.4 million compared to $313.1 million in 2017. Free cash flow for the full year 2018 was $(68.7) million compared to $126.3 million in 2017.
In addition to cash and cash equivalents, the Company had $144.3 million available under its senior amended asset-based revolving credit facility ("ABL facility") for total liquidity of $409.3 million at December 31, 2018.
Total debt at December 31, 2018 was $831.1 million compared to $758.2 million at December 31, 2017. Net debt (defined as total debt minus cash and cash equivalents) at December 31, 2018 was $566.1 million compared to $242.3 million at December 31, 2017. Cooper Standard's net leverage ratio (defined as net debt divided by adjusted EBITDA) at December 31, 2018 was 1.5 times trailing 12 months adjusted EBITDA.
Outlook
The Company has issued 2019 full year guidance as follows:
Current Guidance
Sales
$3.40 - $3.60 billion
---
Adjusted EBITDA(1)
$300 - $340 million
---
Capital Expenditures
$180 - $190 million
---
Cash Restructuring
$15 - $25 million
---
Effective Tax Rate 16% - 18%
---
(1) Adjusted EBITDA is a non-GAAP
financial measure. We have not
provided a reconciliation of
projected adjusted EBITDA to
projected net income because
full-year net income will
include special items that have
not yet occurred and are
difficult to predict with
reasonable certainty prior to
year-end. Due to this
uncertainty, we cannot reconcile
projected adjusted EBITDA to U.S.
GAAP net income without
unreasonable effort.
Conference Call Details
Cooper Standard management will host a conference call and webcast on February 15 at 9 a.m. ET to discuss its fourth quarter and full year 2018 results, provide a general business update and respond to investor questions.
To participate in the live question-and-answer session, callers in the United States and Canada should dial toll-free 877-374-4041 (international callers dial 253-237-1156) and provide the conference ID 9692137 or ask to be connected to the Cooper Standard teleconference. Callers should dial in at least five minutes prior to the start of the call. Financial and automotive analysts are invited to ask questions after the presentations are made.
The interactive webcast and slide presentation can be accessed live or in replay on the investor relations page of the Cooper Standard website at www.ir.cooperstandard.com/events.cfm.
About Cooper Standard
Cooper Standard, headquartered in Novi, Mich., is a leading global supplier of systems and components for the automotive industry. Products include rubber and plastic sealing, fuel and brake lines, fluid transfer hoses and anti-vibration systems. Cooper Standard employs approximately 32,000 people globally and operates in 21 countries around the world. For more information, please visit www.cooperstandard.com.
Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of U.S. federal securities laws, and we intend that such forward-looking statements be subject to the safe harbor created thereby. Our use of words "estimate," "expect," "anticipate," "project," "plan," "intend," "believe," "outlook," "guidance," "forecast," or future or conditional verbs, such as "will," "should," "could," "would," or "may," and variations of such words or similar expressions are intended to identify forward-looking statements. All forward-looking statements are based upon our current expectations and various assumptions. Our expectations, beliefs, and projections are expressed in good faith and we believe there is a reasonable basis for them. However, we cannot assure you that these expectations, beliefs and projections will be achieved. Forward-looking statements are not guarantees of future performance and are subject to significant risks and uncertainties that may cause actual results or achievements to be materially different from the future results or achievements expressed or implied by the forward-looking statements. Among other items, such factors may include: prolonged or material contractions in automotive sales and production volumes; our inability to realize sales represented by awarded business; escalating pricing pressures; loss of large customers or significant platforms; our ability to successfully compete in the automotive parts industry; availability and increasing volatility in costs of manufactured components and raw materials; disruption in our supply base; entering new markets; possible variability of our working capital requirements; risks associated with our international operations, including changes in laws, regulations, and policies governing the terms of foreign trade such as increased trade restrictions and tariffs; foreign currency exchange rate fluctuations; our ability to control the operations of our joint ventures for our sole benefit; our substantial amount of indebtedness; our ability to obtain adequate financing sources in the future; operating and financial restrictions imposed on us under our debt instruments; the underfunding of our pension plans; significant changes in discount rates and the actual return on pension assets; effectiveness of continuous improvement programs and other cost savings plans; manufacturing facility closings or consolidation; our ability to execute new program launches; our ability to meet customers' needs for new and improved products; the possibility that our acquisitions and divestitures may not be successful; product liability, warranty and recall claims brought against us; laws and regulations, including environmental, health and safety laws and regulations; legal proceedings, claims or investigations against us; work stoppages or other labor disruptions; the ability of our intellectual property to withstand legal challenges; cyber-attacks or other disruptions in our information technology systems; the possible volatility of our annual effective tax rate; changes in our assumptions as a result of IRS issuing guidance on the Tax Cuts and Jobs Act; the possibility of future impairment charges to our goodwill and long-lived assets; our dependence on our subsidiaries for cash to satisfy our obligations; and other risks and uncertainties, including those detailed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission.
You should not place undue reliance on these forward-looking statements. Our forward-looking statements speak only as of the date of this press release and we undertake no obligation to publicly update or otherwise revise any forward-looking statement, whether as a result of new information, future events or otherwise, except where we are expressly required to do so by law.
This press release also contains estimates and other information that is based on industry publications, surveys and forecasts. This information involves a number of assumptions and limitations, and we have not independently verified the accuracy or completeness of the information.
CPS_F
Contact for Analysts:
Contact for Media:
Roger Hendriksen
Sharon Wenzl
Cooper Standard
Cooper Standard
(248) 596-6465
(248) 596-6211
roger.hendriksen@cooperstandard.com
sswenzl@cooperstandard.com
---
*The financial results discussed throughout this release are presented on a preliminary basis. The Company's annual report on Form 10-K for the year ended Dec. 31, 2018 will include audited financial results.
Financial statements and related notes follow:
COOPER-STANDARD HOLDINGS INC.
CONSOLIDATED STATEMENTS OF NET INCOME
(Dollar amounts in thousands except share and per share amounts)
Quarter Ended December 31, Year Ended December 31,
2018 2017 2018 2017
---
(Unaudited) (Unaudited) (Unaudited)
Sales $
871,987 $
937,914 $
3,629,293 $
3,618,126
Cost of products sold 760,331 759,474 3,075,737 2,946,687
Gross profit 111,656 178,440 553,556 671,439
Selling, administration & engineering expenses 75,892 80,603 314,805 340,963
Amortization of intangibles 4,248 3,493 14,844 14,056
Gain on sale of land 337 (10,377)
Goodwill impairment charges 45,281 45,281
Other impairment charges 43,706 10,493 43,706 14,763
Restructuring charges 9,881 6,917 29,722 35,137
Operating profit (loss) (67,689) 76,934 115,575 266,520
Interest expense, net of interest income (11,248) (10,324) (41,004) (42,112)
Equity in earnings of affiliates 2,370 1,784 6,718 5,519
Loss on refinancing and extinguishment of debt - (770) (1,020)
Other expense, net (1,640) (5,164) (5,613) (15,807)
Income (loss) before income taxes (78,207) 63,230 74,906 213,100
Income tax expense (benefit) (49,514) 34,269 (29,683) 74,527
Net income (loss) (28,693) 28,961 104,589 138,573
Net (income) loss attributable to noncontrolling interests 5,634 (460) 3,177 (3,270)
Net income (loss) attributable to Cooper-Standard Holdings $
(23,059) $
28,501 $
107,766 $
135,303
Inc.
Weighted average shares outstanding
Basic 17,761,701 17,815,292 17,894,718 17,781,272
Diluted 17,761,701 18,591,378 18,290,202 18,776,653
Earnings per share:
Basic $
(1.30) $
1.60 $
6.02 $
7.61
Diluted $
(1.30) $
1.53 $
5.89 $
7.21
COOPER-STANDARD HOLDINGS INC.
CONSOLIDATED BALANCE SHEETS
(Dollar amounts in thousands)
December 31,
2018 2017
---
Assets (Unaudited)
---
Current assets:
Cash and cash equivalents $
264,980 $
515,952
Accounts receivable, net 418,607 494,049
Tooling receivable 141,106 112,561
Inventories 175,572 170,196
Prepaid expenses 36,878 33,205
Other current assets 108,683 100,778
Assets held for sale 103,898
Total current assets 1,249,724 1,426,741
Property, plant and
equipment, net 984,241 952,178
Goodwill 143,681 171,852
Intangible assets, net 99,602 69,091
Deferred tax assets 70,007 33,834
Other assets 75,848 71,952
Total assets $
2,623,103 $
2,725,648
Liabilities and Equity
---
Current liabilities:
Debt payable within one
year $
101,323 $
34,921
Accounts payable 452,320 523,296
Payroll liabilities 92,604 123,090
Accrued liabilities 98,907 145,650
Liabilities held for sale 71,195
Total current liabilities 816,349 826,957
Long-term debt 729,805 723,325
Pension benefits 138,771 180,173
Postretirement benefits
other than pensions 40,901 61,921
Deferred tax liabilities 8,233 9,511
Other liabilities 29,542 68,672
Total liabilities 1,763,601 1,870,559
7% Cumulative participating
convertible preferred
stock -
Equity:
Common stock 17 18
Additional paid-in capital 501,511 512,815
Retained earnings 576,025 511,367
Accumulated other
comprehensive loss (246,088) (197,631)
Total Cooper-Standard
Holdings Inc. equity 831,465 826,569
Noncontrolling interests 28,037 28,520
Total equity 859,502 855,089
Total liabilities and
equity $
2,623,103 $
2,725,648
COOPER-STANDARD HOLDINGS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar amounts in thousands)
Year Ended December 31,
2018 2017 2016
---
(Unaudited)
Operating Activities:
Net income $
104,589 $
138,573 $
140,439
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 131,854 124,032 109,094
Amortization of intangibles 14,844 14,056 13,566
Gain on sale of land (10,377)
Impairment charges 88,987 14,763 1,273
Share-based compensation expense 8,520 24,963 24,032
Equity in earnings, net of dividends related to earnings (1,856) (137) (4,855)
Loss on refinancing and extinguishment of debt 770 1,020 5,104
Deferred income taxes (40,721) 11,076 9,082
Other 2,652 1,286 1,591
Changes in operating assets and liabilities:
Accounts and tooling receivable 17,916 (26,428) (579)
Inventories 1,410 (13,929) 6,651
Prepaid expenses (4,647) 5,981 (7,010)
Accounts payable (32,502) 11,415 70,066
Payroll and accrued liabilities (65,646) 8,879 5,612
Other (66,405) (2,444) (8,595)
Net cash provided by operating activities 149,388 313,106 365,471
Investing activities:
Capital expenditures (218,071) (186,795) (164,368)
Acquisition of businesses, net of cash acquired (171,653) (478) (37,478)
Cash from consolidation of joint venture - 3,395
Other 6,733 (13,349) 185
Net cash used for investing activities (382,991) (200,622) (198,266)
Financing activities:
Proceeds from issuance of long-term debt, net of debt issuance costs - 393,060
Repayment and refinancing of term loan facility - (397,196)
Principal payments on long-term debt (3,437) (19,866) (10,747)
Purchase of noncontrolling interest (2,450)
Repurchase of common stock (59,955) (55,123) (23,800)
Proceeds from exercise of warrants - 2,373 2,810
Increase (decrease) in short term debt, net 65,198 10,683 (12,223)
Taxes withheld and paid on employees' share-based payment awards (11,618) (13,297) (12,624)
Other (2,178) (297) (2,196)
Net cash used for financing activities (14,440) (75,527) (62,916)
Effects of exchange rate changes on cash, cash equivalents and restricted cash (3,019) (1,475) (666)
Changes in cash, cash equivalents and restricted cash (251,062) 35,482 103,623
Cash, cash equivalents and restricted cash at beginning of period 518,461 482,979 379,356
Cash, cash equivalents and restricted cash at end of period $
267,399 $
518,461 $
482,979
Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheet:
Cash and cash equivalents $
264,980 $
515,952 $
480,092
Restricted cash included in other current assets 18 88
Restricted cash included in other assets 2,401 2,421 2,887
Total cash, cash equivalents and restricted cash shown in the statement of cash flows $
267,399 $
518,461 $
482,979
Non-GAAP Measures
EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted earnings per share and free cash flow are measures not recognized under U.S. GAAP and which exclude certain non-cash and special items that may obscure trends and operating performance not indicative of the Company's core financial activities. Management considers EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted earnings per share and free cash flow to be key indicators of the Company's operating performance and believes that these and similar measures are widely used by investors, securities analysts and other interested parties in evaluating the Company's performance. In addition, similar measures are utilized in the calculation of the financial covenants and ratios contained in the Company's financing arrangements and management uses these measures for developing internal budgets and forecasting purposes. EBITDA is defined as net income adjusted to reflect income tax expense, interest expense net of interest income, depreciation and amortization, and adjusted EBITDA is defined as EBITDA further adjusted to reflect certain items that management does not consider to be reflective of the Company's core operating performance. Adjusted EBITDA margin is adjusted EBITDA presented as percentage of sales. Adjusted net income is defined as net income adjusted to reflect certain items that management does not consider to be reflective of the Company's core operating performance. Adjusted earnings per share is defined as adjusted net income divided by the weighted average number of basic and diluted shares. Free cash flow is defined as net cash provided by operating activities minus capital expenditures and is useful to both management and investors in evaluating the Company's ability to service and repay its debt.
When analyzing the Company's operating performance, investors should use EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted earnings per share and free cash flow as supplements to, and not as alternatives for, net income, operating income, or any other performance measure derived in accordance with U.S. GAAP, and not as an alternative to cash flow from operating activities as a measure of the Company's liquidity. EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted earnings per share and free cash flow have limitations as analytical tools and should not be considered in isolation or as substitutes for analysis of the Company's results of operations as reported under U.S. GAAP. Other companies may report EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted earnings per share and free cash flow differently and therefore the Company's results may not be comparable to other similarly titled measures of other companies. In addition, in evaluating adjusted EBITDA and adjusted net income, it should be noted that in the future the Company may incur expenses similar to or in excess of the adjustments in the below presentation. This presentation of adjusted EBITDA and adjusted net income should not be construed as an inference that the Company's future results will be unaffected by special items. Reconciliations of EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted net income and free cash flow follow.
Reconciliation of Non-GAAP Measures
EBITDA and Adjusted EBITDA
The following table provides reconciliation of EBITDA and adjusted EBITDA from net income (unaudited):
Quarter Ended December 31, Year Ended December 31,
2018 2017 2018 2017
---
(dollar amounts in thousands)
Net income attributable to Cooper-Standard Holdings Inc. $
(23,059) $
28,501 $
107,766 $
135,303
Income tax expense (49,514) 34,269 (29,683) 74,527
Interest expense, net of interest income 11,248 10,324 41,004 42,112
Depreciation and amortization 37,427 38,675 146,698 138,088
EBITDA $
(23,898) $
111,769 $
265,785 $
390,030
Other impairment charges (1) 43,706 10,493 43,706 14,763
Goodwill impairment charges (2) 39,818 39,818
Restructuring charges (3) 9,881 6,917 29,722 35,137
Gain on sale of land (4) 337 (10,377)
Project costs (5) 4,881 4,881
Amortization of inventory write-up (6) 925 1,460
Loss on refinancing and extinguishment of debt (7) - 770 1,020
Settlement charges (8) 775 525 775 6,427
Foreign tax amnesty program (9) - 1,502 4,623
Adjusted EBITDA $
76,425 $
131,206 $
376,540 $
452,000
Sales $
871,987 $
937,914 $
3,629,293 $
3,618,126
Net income margin (2.6)
% 3.0
% 3.0
% 3.7
%
Adjusted EBITDA margin 8.8
% 14.0
% 10.4
% 12.5
%
(1) Other non-cash impairment charges in
2018 related to intangible assets of
$791 and fixed assets of $42,915.
Impairment charges in 2017 related
to fixed assets of $14,763.
(2) Non-cash goodwill impairment charges
in 2018 related to impairments at
our Europe and Asia Pacific
reporting units, net of
approximately $5,463 attributable to
our noncontrolling interests.
(3) Includes non-cash impairment charges
related to restructuring.
(4) Gain on sale of land in Europe that
was contemplated in conjunction with
our restructuring plan.
(5) Project costs related to acquisitions
and planned divestiture.
(6) Amortization of write-up of
inventory to fair value for the 2018
acquisitions.
(7) Loss on refinancing and
extinguishment of debt relating to
the March 2018 amendment and May
2017 amendment of the Term Loan
Facility.
(8) Non-cash settlement charges incurred
related to certain of our non-U.S.
pension plans.
(9) Relates to indirect taxes recorded in
cost of products sold.
Adjusted Net Income and Adjusted Earnings Per Share
The following table provides reconciliation of net income to adjusted net income and the respective earnings per share amounts (unaudited):
Quarter Ended December 31, Year Ended December 31,
2018 2017 2018 2017
---
(dollar amounts in thousands, except per share amounts)
Net income attributable to Cooper-Standard Holdings Inc. $
(23,059) $
28,501 $
107,766 $
135,303
Other impairment charges(1) 43,706 10,493 43,706 14,763
Goodwill impairment charges(2) 39,818 39,818
Restructuring charges(3) 9,881 6,917 29,722 35,137
Gain on sale of land(4) 337 (10,377)
Project Costs(5) 4,881 4,881
Amortization of inventory write-up(6) 925 1,460
Loss on refinancing and extinguishment of debt(7) - 770 1,020
Settlement charges(8) 775 525 775 6,427
Foreign tax amnesty program(9) - 1,502 4,623
Tax impact of adjusting items(10) (6,879) (3,912) (7,889) (8,855)
Reversal of deferred tax valuation allowance (11) (43,606) (43,606)
Impact of U.S. tax reform(12) 748 33,484 (6,322) 33,484
Worthless security tax deduction(13) - (13,947) (13,947)
Adjusted net income $
27,527 $
63,563 $
160,704 $
207,955
Weighted average shares outstanding
Basic 17,761,701 17,815,292 17,894,718 17,781,272
Diluted (14) 17,761,701 18,591,378 18,290,202 18,776,653
Earnings per share:
Basic $
(1.30) $
1.60 $
6.02 $
7.61
Diluted $
(1.30) $
1.53 $
5.89 $
7.21
Adjusted earnings per share:
Basic $
1.55 $
3.57 $
8.98 $
11.70
Diluted $
1.53 $
3.42 $
8.79 $
11.08
(1) Other non-cash impairment charges in
2018 related to intangible assets of
$791 and fixed assets of $42,915.
Impairment charges in 2017 related
to fixed assets of $14,763.
(2) Non-cash goodwill impairment charges
in 2018 related to impairments at
our Europe and Asia Pacific
reporting units, net of
approximately $5,463 attributable to
our noncontrolling interests.
(3) Includes non-cash impairment charges
related to restructuring.
(4) Gain on sale of land in Europe that
was contemplated in conjunction with
our restructuring plan.
(5) Project costs related to acquisitions
and planned divestiture.
(6) Amortization of write-up of
inventory to fair value for the 2018
acquisitions.
(7) Loss on refinancing and
extinguishment of debt relating to
the March 2018 amendment and May
2017 amendment of the Term Loan
Facility.
(8) Non-cash settlement charges incurred
related to certain of our non-U.S.
pension plans.
(9) Relates to indirect taxes recorded in
cost of products sold.
(10) Represents the elimination of the
income tax impact of the above
adjustments, by calculating the
income tax impact of these adjusting
items using the appropriate tax rate
for the jurisdiction where the
charges were incurred.
(11) Relates to the reversal of the
Company's valuation allowance on net
deferred tax assets in France and on
capital losses in the U.S.
(12) Tax impact of the transition tax on
undistributed foreign earnings and
the tax effect of adjusting deferred
taxes for the Tax Cuts and Jobs Act
enacted into law on December 22,
2017.
(13) Discrete tax benefit recorded in Q4
2017.
(14) For the purpose of calculating Q4
2018 adjusted diluted earnings per
share, the weighted average shares
outstanding were 18,003,882.
Free Cash Flow
The following table defines free cash flow (unaudited):
Quarter Ended December 31, Year Ended December 31,
2018 2017 2018 2017
---
(dollar amounts in thousands)
Net cash provided by operating activities $
71,384 $
208,016 $
149,388 $
313,106
Capital expenditures (57,983) (49,349) (218,071) (186,795)
Free cash flow $
13,401 $
158,667 $
(68,683) $
126,311
View original content:http://www.prnewswire.com/news-releases/cooper-standard-reports-fourth-quarter-and-full-year-2018-results-300796430.html
SOURCE Cooper-Standard Holdings Inc.
