- Sales up 24% versus prior year quarter and up 6%
sequentially
- Basic EPS up $0.01 per share versus prior year quarter and
up $0.05 sequentially
- Improving order activity with backlog up 6%
sequentially
Ampco-Pittsburgh Corporation (NYSE: AP) (the "Corporation" or
“Ampco-Pittsburgh”) reported net sales of $92.4 million and $179.2
million, respectively, for the three and six months ended June 30,
2021, compared to $74.8 million and $165.8 million for the three
and six months ended June 30, 2020, respectively. The increase is
primarily attributable to higher shipments of mill rolls and higher
shipments of forged engineered products.
Income (loss) from operations for the three and six months ended
June 30, 2021, was $0.5 million and $1.4 million, respectively,
compared to $(0.1) million and $4.3 million for the three and six
months ended June 30, 2020, respectively. For the three months
ended June 30, 2021, the improvement primarily reflects the impacts
of higher shipment volumes and improved cost absorption from higher
production levels in the current quarter compared to significant
downtime from the idling of manufacturing facilities associated
with the early stages of the pandemic in the prior year quarter.
For the six months ended June 30, 2021, income from operations
declined as higher raw material costs net of surcharges, a less
favorable sales mix, and an insurance recovery of $0.8 million in
the prior year more than offset the benefit of higher shipment
volumes in the current year.
Investment-related income for the three and six months ended
June 30, 2021, includes a dividend of $1.0 million from one of the
Corporation’s Chinese joint ventures. Interest expense for the
three and six months ended June 30, 2021, declined in comparison to
the prior year based on reduced debt. Other – net was approximately
comparable for the three-month periods ended June 30, 2021, and
2020, though improved for the six months ended June 30, 2021, due
to higher pension income and unrealized gains on Rabbi Trust
assets.
The income tax provision for the three and six months ended June
30, 2021, includes unusual expenses totaling $0.7 million, or $0.04
per common share, for the revaluation of certain deferred income
tax liabilities for a future tax rate change enacted in the U.K.
during the quarter and for the restructuring of a foreign sales
office. The income tax benefit for the six months ended June 30,
2020, includes a benefit of $3.5 million due to expanded tax loss
carryback provisions made possible by the CARES Act.
Basic earnings per share were $0.06 and $0.07 for the three and
six months ended June 30, 2021, respectively. This compares to
$0.05 and $0.38 per share for the three and six months ended June
30, 2020, respectively. Basic earnings per share for the six months
ended June 30, 2020, included a $0.34 per share combined benefit
for the CARES Act tax loss carryback and the insurance
recovery.
Commenting on the quarter, Ampco-Pittsburgh’s CEO, Brett
McBrayer, said, “Sales and earnings for the second quarter improved
sequentially and exceeded prior year, when we idled our facilities
to manage the sharp drop in demand and to preserve liquidity due to
the pandemic. Now, a year later, we have seen capacity utilization
in the global rolled steel sector returning to pre-pandemic levels
while raw material prices have risen. Order activity continues to
improve, and we expect to see a full top line recovery to
pre-pandemic sales in 2022. We have been managing through supply
chain and logistical challenges which have impacted our operations.
Some of our customers are likewise facing similar challenges and,
as a result, have pushed out deliveries to match their current
production capabilities. In the third quarter, we will execute
plant maintenance shutdowns to prepare our machinery for higher
production levels. Also, during the quarter, we amended and
extended our revolving credit facility to assure significant
liquidity for our strategic capital expenditures and to support
anticipated growth in working capital.”
Segment Results
Forged and Cast Engineered
Products
Sales for the Forged and Cast Engineered Products segment for
the three and six months ended June 30, 2021, improved from the
prior year period primarily due to higher shipments of forged and
cast mill rolls as well as higher shipments of forged engineered
products to the oil and gas and steel distribution markets.
Operating results for the three months ended June 30, 2021,
improved compared to the prior year primarily due to the higher
volume of shipments and improved cost absorption from higher
production levels in the current quarter compared to significant
downtime from the pandemic-related idling of manufacturing
facilities in the prior year quarter. For the six months ended June
30, 2021, operating results declined primarily as the effect of
higher shipment volumes could not offset the impacts of higher raw
material costs net of surcharges, a less favorable sales mix, and
an insurance recovery recorded in the prior year.
Air and Liquid Processing
Sales and operating results for the Air and Liquid Processing
segment for the three and six months ended June 30, 2021, decreased
compared to the prior year primarily due to a lower volume of
centrifugal pumps shipments driven mainly by customer-requested
delays.
Teleconference Access
Ampco-Pittsburgh Corporation (NYSE: AP) will hold a conference
call on Tuesday, August 10, 2021, at 10:30 a.m. Eastern Time (ET)
to discuss its financial results for the second quarter ended June
30, 2021. The Corporation encourages participants to pre-register
at any time, including up to and after the call start time via this
link: https://dpregister.com/sreg/10158831/eb5ea651ea. Those
without internet access or unable to pre-register should dial in at
least five minutes before the start time using:
- Participant Dial-in (Toll Free): 1-844-308-3408
- Participant International Dial-in: 1-412-317-5408
For those unable to listen to the live broadcast, a replay will
be available one hour after the event concludes on the
Corporation’s website under the Investors menu at
www.ampcopgh.com.
About Ampco-Pittsburgh Corporation
Ampco-Pittsburgh Corporation manufactures and sells highly
engineered, high-performance specialty metal products and
customized equipment utilized by industry throughout the world.
Through its operating subsidiary, Union Electric Steel Corporation,
it is a leading producer of forged and cast rolls for the global
steel and aluminum industry. It also manufactures open-die forged
products that principally are sold to customers in the steel
distribution market, oil and gas industry, and the aluminum and
plastic extrusion industries. The Corporation is also a producer of
air and liquid processing equipment, primarily custom-engineered
finned tube heat exchange coils, large custom air handling systems,
and centrifugal pumps. It operates manufacturing facilities in the
United States, England, Sweden, Slovenia, and participates in three
operating joint ventures located in China. It has sales offices in
North and South America, Asia, Europe, and the Middle East.
Corporate headquarters is located in Carnegie, Pennsylvania.
Forward-Looking
Statements
The Private Securities Litigation Reform Act of 1995 (the “Act”)
provides a safe harbor for forward-looking statements made by or on
behalf of Ampco-Pittsburgh Corporation (the “Corporation”). This
press release may include, but is not limited to, statements about
operating performance, trends, events that the Corporation expects
or anticipates will occur in the future, statements about sales and
production levels, restructurings, the impact from global pandemics
(including COVID-19), profitability and anticipated expenses,
future proceeds from the exercise of outstanding warrants, and cash
outflows. All statements in this document other than statements of
historical fact are statements that are, or could be, deemed
“forward-looking statements” within the meaning of the Act and
words such as “may,” “will,” “intend,” “believe,” “expect,”
“anticipate,” “estimate,” “project,” “forecast” and other terms of
similar meaning that indicate future events and trends are also
generally intended to identify forward-looking statements.
Forward-looking statements speak only as of the date on which such
statements are made, are not guarantees of future performance or
expectations, and involve risks and uncertainties. For the
Corporation, these risks and uncertainties include, but are not
limited to: cyclical demand for products and economic downturns;
excess global capacity in the steel industry; fluctuations of the
value of the U.S. dollar relative to other currencies; increases in
commodity prices or shortages of key production materials;
consequences of global pandemics (including COVID-19); changes in
the existing regulatory environment; new trade restrictions and
regulatory burdens associated with “Brexit”; inability of the
Corporation to successfully restructure its operations; limitations
in availability of capital to fund the Corporation’s operations and
strategic plan; inoperability of certain equipment on which the
Corporation relies; work stoppage or another industrial action on
the part of any of the Corporation’s unions; liability of the
Corporation’s subsidiaries for claims alleging personal injury from
exposure to asbestos-containing components historically used in
certain products of those subsidiaries; inability to satisfy the
continued listing requirements of the New York Stock Exchange or
NYSE American; failure to maintain an effective system of internal
control; potential attacks on information technology infrastructure
and other cyber-based business disruptions; and those discussed
more fully elsewhere in this report and in documents filed with the
Securities and Exchange Commission by the Corporation, particularly
in Item 1A, Risk Factors, in Part I of the Corporation’s latest
Annual Report on Form 10-K. The Corporation cannot guarantee any
future results, levels of activity, performance or achievements. In
addition, there may be events in the future that the Corporation
may not be able to predict accurately or control which may cause
actual results to differ materially from expectations expressed or
implied by forward-looking statements. Except as required by
applicable law, the Corporation assumes no obligation, and
disclaims any obligation, to update forward-looking statements
whether as a result of new information, events or otherwise.
AMPCO-PITTSBURGH
CORPORATION
FINANCIAL SUMMARY
(in thousands, except per
share amounts)
Three Months Ended June 30,
Six Months Ended June 30,
2021
2020
2021
2020
Net sales
$
92,428
$
74,778
$
179,228
$
165,841
Cost of products sold (excl. depreciation
and amortization)
75,433
59,983
145,021
130,143
Selling and administrative
12,070
10,199
23,628
22,029
Depreciation and amortization
4,493
4,653
9,236
9,352
(Gain) loss on disposal of assets
(37
)
29
(33
)
52
Total operating expenses
91,959
74,864
177,852
161,576
Income (loss) from operations
469
(86
)
1,376
4,265
Other income (expense):
Investment-related income
1,047
108
1,065
112
Interest expense
(943
)
(994
)
(1,838
)
(2,210
)
Other – net
2,023
2,337
2,688
1,017
Total other income (expense) – net
2,127
1,451
1,915
(1,081
)
Income before income taxes
2,596
1,365
3,291
3,184
Income tax (provision) benefit
(1,372
)
(504
)
(1,753
)
2,279
Net income
1,224
861
1,538
5,463
Less: Net income attributable to
noncontrolling interest
161
193
308
653
Net income attributable to
Ampco-Pittsburgh
$
1,063
$
668
$
1,230
$
4,810
Net income per share attributable to
Ampco-Pittsburgh common shareholders:
Basic
$
0.06
$
0.05
$
0.07
$
0.38
Diluted
$
0.05
$
0.05
$
0.06
$
0.37
Weighted-average number of common shares
outstanding:
Basic
18,981
12,740
18,810
12,698
Diluted
21,249
13,382
20,981
12,959
AMPCO-PITTSBURGH
CORPORATION
SEGMENT INFORMATION
(in thousands)
Three Months Ended June 30,
Six Months Ended June 30,
2021
2020
2021
2020
Net Sales:
Forged and Cast Engineered Products
$
71,028
$
50,460
$
134,379
$
119,224
Air and Liquid Processing
21,400
24,318
44,849
46,617
Consolidated
$
92,428
$
74,778
$
179,228
$
165,841
Income from Operations:
Forged and Cast Engineered Products
$
1,674
$
(423
)
$
3,520
$
4,133
Air and Liquid Processing
2,062
2,846
4,374
5,430
Corporate costs
(3,267
)
(2,509
)
(6,518
)
(5,298
)
Consolidated
$
469
$
(86
)
$
1,376
$
4,265
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210809005812/en/
Michael G. McAuley Senior Vice President, Chief Financial
Officer and Treasurer (412) 429-2472 mmcauley@ampcopgh.com
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