Altra Industrial Motion Corp. (Nasdaq: AIMC) (“Altra” or the
“Company”), a premier global manufacturer and supplier of motion
control, power transmission and automation products, today
announced unaudited financial results as of and for the fourth
quarter and year ended December 31, 2022.
Q4 2022 Financial Highlights
|
Q4 2022 |
Q4 2021 |
YOY Change |
Net sales |
$469.4M |
$469.8M |
(0.1%) |
|
- Q4 2022 Organic Sales Growth was 2.3% for the
consolidated business compared with the fourth quarter of
2021.*
|
GAAP Net Income |
$22.3M |
($87.7M) |
125.4% |
GAAP Net Income Margin |
4.8% |
(18.7%) |
2,350 bps |
Non-GAAP Net Income* |
$47.9M |
$43.4M |
10.4% |
Earnings per diluted share |
$0.34 |
($1.35) |
125.2% |
Non-GAAP Earnings per diluted share* |
$0.73 |
$0.67 |
9.0% |
Non-GAAP Adjusted EBITDA* |
$96.2M |
$87.2M |
10.3% |
Non-GAAP Adjusted EBITDA Margin* |
20.5% |
18.6% |
190 bps |
Operating Income Margin |
10.8% |
(20.2%) |
3,100 bps |
Non-GAAP Operating Income Margin* |
16.7% |
14.4% |
230 bps |
Cash Flow from Operations |
$52.5M |
$46.9M |
11.9% |
Non-GAAP Adjusted Free Cash Flow* |
$45.6M |
$31.9M |
42.9% |
As previously disclosed in our Form 8-K, filed on October 27,
2022, we entered into a definitive merger agreement (the “Merger
Agreement”) to be acquired by Regal Rexnord Corporation (“Parent”),
under which Altra stockholders will receive $62.00 in cash for each
share of Altra common stock held by such stockholders, other than
(i) shares owned by the Company, any subsidiary of the Company,
Parent, Aspen Sub, Inc., a wholly-owned subsidiary of Parent, or
any other subsidiary of Parent, (ii) shares owned by stockholders
of the Company who have validly exercised their statutory rights of
appraisal under the Delaware General Corporation Law and (iii)
shares that are Company Restricted Shares (as defined in the Merger
Agreement). As announced in our Form 8-K, filed on January 18,
2023, the merger agreement was approved by our shareholders. The
transaction is expected to close in the first half of 2023, subject
to customary closing conditions, including receipt of regulatory
approvals.
Management Comments
“Altra delivered solid fourth quarter results as our strategy to
align the business with attractive secular trends and drive
operational excellence yielded strong revenue performance and gross
margin expansion even in the face of a challenging market
environment,” said Carl Christenson, Altra’s Chairman and Chief
Executive Officer. “Q4 sales of $469.4 million were essentially
flat with the prior year while Organic Sales* were up 2.3% compared
to the same period last year. Included in the Q4 2021 net sales are
revenues of approximately $38.5 million related to the Jacobs
Vehicle Systems business that was divested by the Company on April
8, 2022. On a full year basis, 2022 was in line with 2021 sales,
which included over $190 million from the now divested JVS
business, and we achieved our 3% to 5% Organic Growth* goal for the
year.
“We once again did an excellent job capitalizing on several
healthy end market trends, notably in factory automation and IoT
where we continued to benefit from strong demand for Altra’s
high-value automation products. Gross margin improved approximately
280 bps in the quarter, reflecting the benefits of our pricing
actions and stronger visibility into supplier cost volatility,
which was a headwind for us this time last year.
“Our strategy to position Altra as a high-value technology
leader across attractive industrial markets continues to support a
resilient performance at both the top and bottom lines. We are
proud of the Altra team for their ongoing commitment to delivering
excellent results for all of our stakeholders.”
*Reconciliations of Non-GAAP Disclosures
(Amounts in Millions of Dollars, except per share
information)
*Reconciliation of Non-GAAP Net Income:
|
Quarter Ended December 31, |
|
|
|
Year Ended December 31, |
|
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
Net income/(loss) |
$ |
22.3 |
|
|
|
$ |
(87.7 |
) |
|
|
$ |
127.0 |
|
|
|
$ |
27.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring |
|
0.4 |
|
|
|
|
0.6 |
|
|
|
|
5.2 |
|
|
|
|
3.0 |
|
|
|
Consolidation costs |
|
1.7 |
|
|
|
|
— |
|
|
|
|
1.7 |
|
|
|
|
— |
|
|
|
Building impairment |
|
— |
|
|
|
|
— |
|
|
|
|
3.0 |
|
|
|
|
— |
|
|
|
Acquisition related stock
compensation expense |
|
— |
|
|
|
|
0.2 |
|
|
|
|
— |
|
|
|
|
0.9 |
|
|
|
Acceleration of stock
compensation expense upon retirement |
|
— |
|
|
|
|
1.3 |
|
|
|
|
0.6 |
|
|
|
|
1.3 |
|
|
|
Acquisition related
amortization expense |
|
13.8 |
|
|
|
|
17.5 |
|
|
|
|
55.2 |
|
|
|
|
70.4 |
|
|
|
Customer accommodation and
other non-recurring charges |
|
3.0 |
|
|
|
|
— |
|
|
|
|
3.0 |
|
|
|
|
— |
|
|
|
Non-cash amortization of
interest rate swap settlement fee |
|
— |
|
|
|
|
16.7 |
|
|
|
|
— |
|
|
|
|
25.7 |
|
|
|
Loss on extinguishment of
debt |
|
— |
|
|
|
|
15.4 |
|
|
|
|
— |
|
|
|
|
15.4 |
|
|
|
Acquisition related
expenses |
|
9.9 |
|
|
|
|
0.8 |
|
|
|
|
10.6 |
|
|
|
|
1.5 |
|
|
|
Amortization of inventory fair
value adjustment |
|
— |
|
|
|
|
— |
|
|
|
|
2.4 |
|
|
|
|
— |
|
|
|
Tax impact of above adjustments |
|
(6.7 |
) |
(1) |
|
(11.3 |
) |
(2) |
|
(19.0 |
) |
(3) |
|
(25.1 |
) |
(4) |
JVS impairment |
|
1.9 |
|
|
|
|
142.4 |
|
|
|
|
10.2 |
|
|
|
|
142.4 |
|
|
|
Valuation allowance for stock
compensation deferred tax asset |
|
1.6 |
|
|
|
|
1.4 |
|
|
|
|
1.6 |
|
|
|
|
1.4 |
|
|
|
Tax expense due to JVS
impairment charge |
|
— |
|
|
|
|
(53.9 |
) |
|
|
|
10.5 |
|
|
|
|
(53.9 |
) |
|
|
Tax law change related to IRC
Section 174 |
|
— |
|
|
|
|
— |
|
|
|
|
2.8 |
|
|
|
|
— |
|
|
|
Non-GAAP net income* |
$ |
47.9 |
|
|
|
$ |
43.4 |
|
|
|
$ |
214.8 |
|
|
|
$ |
210.7 |
|
|
|
Non-GAAP diluted earnings per
share* |
$ |
0.73 |
|
|
|
$ |
0.67 |
|
|
|
$ |
3.28 |
|
|
|
$ |
3.22 |
|
|
|
(1) - tax impact
is calculated by multiplying the estimated effective tax rate for
the period of 23.3% by the above items. |
|
(2) - tax impact
is calculated by multiplying the estimated effective tax rate for
the period of 21.5% by the above items. |
|
(3) - tax impact
is calculated by multiplying the estimated effective tax rate for
the period of 23.3% by the above items. |
|
(4) - tax impact
is calculated by multiplying the estimated effective tax rate for
the period of 21.2% by the above items. |
|
|
|
*Reconciliation of Non-GAAP Free Cash Flow and Non-GAAP Adjusted
Free Cash Flow:
|
Quarter Ended December 31, |
|
|
Year Ended December 31, |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Net cash flows provided by operating activities |
$ |
52.5 |
|
|
$ |
46.9 |
|
|
$ |
125.0 |
|
|
$ |
217.0 |
|
Purchase of property, plant
and equipment |
|
(13.2 |
) |
|
|
(15.0 |
) |
|
|
(55.9 |
) |
|
|
(40.6 |
) |
Non-GAAP Free Cash Flow* |
|
39.3 |
|
|
|
31.9 |
|
|
|
69.1 |
|
|
|
176.4 |
|
JVS transaction costs
paid |
|
1.0 |
|
|
|
— |
|
|
|
8.6 |
|
|
|
— |
|
Tax paid for JVS
divestiture |
|
5.3 |
|
|
|
— |
|
|
|
21.4 |
|
|
|
— |
|
Non-GAAP Adjusted Free Cash
Flow* |
$ |
45.6 |
|
|
$ |
31.9 |
|
|
$ |
99.1 |
|
|
$ |
176.4 |
|
*Reconciliation of Net Debt:
|
|
Amounts in millions |
|
|
|
Years Ended December 31, |
|
|
|
2022 |
|
|
2021 |
|
Total gross debt |
|
$ |
1,046.2 |
|
|
$ |
1,414.3 |
|
Cash |
|
|
(208.9 |
) |
|
|
(246.1 |
) |
Net Debt |
|
$ |
837.3 |
|
|
$ |
1,168.2 |
|
*Reconciliation of Organic Sales and Organic Sales Growth:
|
|
Quarter Ended December 31, 2022 |
|
Year Ended December 31, 2022 |
|
|
Results ($) |
|
|
Growth (%) |
|
Results ($) |
|
|
Growth (%) |
Net sales and net sales growth |
|
$ |
469.4 |
|
|
-0.1% |
|
$ |
1,945.5 |
|
|
2.4% |
Less: unfavorable foreign
currency translation |
|
|
(21.7 |
) |
|
-4.6% |
|
|
(71.9 |
) |
|
-3.8% |
Less: Nook acquisition |
|
|
10.5 |
|
|
2.2% |
|
|
46.2 |
|
|
2.4% |
Organic sales and organic
sales growth* |
|
$ |
480.6 |
|
|
2.3% |
|
$ |
1,971.2 |
|
|
3.8% |
Included in the fourth quarter and full year 2021 net sales are
revenues of approximately $38.5 million and $193.5 million,
respectively, related to the Jacobs Vehicle Systems business that
was divested by the Company on April 8, 2022.
*Reconciliation of Non-GAAP Income from Operations and Non-GAAP
Income from Operations Margin:
|
Quarter Ended December 31, |
|
|
Year Ended December 31, |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Income (loss) from operations |
$ |
50.6 |
|
|
$ |
(95.0 |
) |
|
$ |
240.4 |
|
|
$ |
97.4 |
|
Income (loss) from operations as
a percent of net sales |
|
10.8 |
% |
|
|
-20.2 |
% |
|
|
12.4 |
% |
|
|
5.1 |
% |
Restructuring |
|
0.4 |
|
|
|
0.6 |
|
|
|
5.2 |
|
|
|
3.0 |
|
Consolidation costs |
|
1.7 |
|
|
|
— |
|
|
|
1.7 |
|
|
|
— |
|
Acquisition related stock
compensation expense |
|
— |
|
|
|
0.2 |
|
|
|
— |
|
|
|
0.9 |
|
Acceleration of stock
compensation expense upon retirement |
|
— |
|
|
|
1.3 |
|
|
|
0.6 |
|
|
|
1.3 |
|
Acquisition related amortization
expense |
|
13.8 |
|
|
|
17.5 |
|
|
|
55.2 |
|
|
|
70.4 |
|
Impairment charges |
|
1.9 |
|
|
|
142.4 |
|
|
|
13.2 |
|
|
|
142.4 |
|
Acquisition related expenses |
|
9.9 |
|
|
|
0.8 |
|
|
|
10.6 |
|
|
|
1.5 |
|
Amortization of inventory fair
value adjustment |
|
— |
|
|
|
— |
|
|
|
2.4 |
|
|
|
— |
|
Non-GAAP Income From
Operations* |
$ |
78.3 |
|
|
$ |
67.8 |
|
|
$ |
329.3 |
|
|
$ |
316.9 |
|
Non-GAAP Income From
Operations as a percent of net sales |
|
16.7 |
% |
|
|
14.4 |
% |
|
|
16.9 |
% |
|
|
16.7 |
% |
*Reconciliation of Non-GAAP Operating Income and Non-GAAP
Operating Income Margin:
Selected Statement of
Income Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended December 31, 2022 |
|
|
Quarter Ended December 31, 2021 |
|
|
|
GAAP Operating Income |
|
|
Adjustments |
|
|
Non-GAAP Operating Income* |
|
|
GAAP Operating Income |
|
|
Adjustments |
|
|
Non-GAAP Operating Income* |
|
Net sales |
|
$ |
469.4 |
|
|
$ |
— |
|
|
$ |
469.4 |
|
|
$ |
469.8 |
|
|
$ |
— |
|
|
$ |
469.8 |
|
Cost of sales |
|
|
298.7 |
|
|
|
0.7 |
|
|
|
298.0 |
|
|
|
311.9 |
|
|
|
— |
|
|
|
311.9 |
|
Gross profit |
|
|
170.7 |
|
|
|
0.7 |
|
|
|
171.4 |
|
|
|
157.9 |
|
|
|
— |
|
|
|
157.9 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general & administrative expenses |
|
|
102.3 |
|
|
|
24.7 |
|
|
|
77.6 |
|
|
|
93.5 |
|
|
|
19.8 |
|
|
|
73.7 |
|
Impairment charges |
|
|
1.9 |
|
|
|
1.9 |
|
|
|
— |
|
|
|
142.4 |
|
|
|
142.4 |
|
|
|
— |
|
Research and development expenses |
|
|
15.5 |
|
|
|
— |
|
|
|
15.5 |
|
|
|
16.4 |
|
|
|
— |
|
|
|
16.4 |
|
Restructuring |
|
|
0.4 |
|
|
|
0.4 |
|
|
|
— |
|
|
|
0.6 |
|
|
|
0.6 |
|
|
|
— |
|
Income from Operations |
|
$ |
50.6 |
|
|
$ |
27.7 |
|
|
$ |
78.3 |
|
|
$ |
(95.0 |
) |
|
$ |
162.8 |
|
|
$ |
67.8 |
|
GAAP and Non-GAAP Income From
Operations as a percent of net sales |
|
|
10.8 |
% |
|
|
|
|
|
16.7 |
% |
|
|
-20.2 |
% |
|
|
|
|
|
14.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year to Date Ended December 31, 2022 |
|
|
Year to Date Ended December 31, 2021 |
|
|
|
GAAP Operating Income |
|
|
Adjustments |
|
|
Non-GAAP Operating Income* |
|
|
GAAP Operating Income |
|
|
Adjustments |
|
|
Non-GAAP Operating Income* |
|
Net sales |
|
$ |
1,945.5 |
|
|
$ |
— |
|
|
$ |
1,945.5 |
|
|
$ |
1,899.8 |
|
|
$ |
— |
|
|
$ |
1,899.8 |
|
Cost of sales |
|
|
1,252.6 |
|
|
|
3.1 |
|
|
|
1,249.5 |
|
|
|
1,224.4 |
|
|
|
— |
|
|
|
1,224.4 |
|
Gross profit |
|
|
692.9 |
|
|
|
3.1 |
|
|
|
696.0 |
|
|
|
675.4 |
|
|
|
— |
|
|
|
675.4 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general & administrative expenses |
|
|
370.0 |
|
|
|
67.4 |
|
|
|
302.6 |
|
|
|
368.7 |
|
|
|
74.1 |
|
|
|
294.6 |
|
Impairment charges |
|
|
13.2 |
|
|
|
13.2 |
|
|
|
— |
|
|
|
142.4 |
|
|
|
142.4 |
|
|
|
— |
|
Research and development expenses |
|
|
64.1 |
|
|
|
— |
|
|
|
64.1 |
|
|
|
63.9 |
|
|
|
— |
|
|
|
63.9 |
|
Restructuring |
|
|
5.2 |
|
|
|
5.2 |
|
|
|
— |
|
|
|
3.0 |
|
|
|
3.0 |
|
|
|
— |
|
Income from Operations |
|
$ |
240.4 |
|
|
$ |
88.9 |
|
|
$ |
329.3 |
|
|
$ |
97.4 |
|
|
$ |
219.5 |
|
|
$ |
316.9 |
|
GAAP and Non-GAAP Income From
Operations as a percent of net sales |
|
|
12.4 |
% |
|
|
|
|
|
16.9 |
% |
|
|
5.1 |
% |
|
|
|
|
|
16.7 |
% |
*Reconciliation of Non-GAAP Adjusted EBITDA and Non-GAAP
Adjusted EBITDA Margin:
|
Quarter Ended December 31, |
|
|
Year Ended December 31, |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Net income/(loss) |
$ |
22.3 |
|
|
$ |
(87.7 |
) |
|
$ |
127.0 |
|
|
$ |
27.7 |
|
Net income/(loss) as a percent of
net sales |
|
4.8 |
% |
|
|
-18.7 |
% |
|
|
6.5 |
% |
|
|
1.5 |
% |
Loss on foreign currency and
other, net |
|
4.6 |
|
|
|
1.9 |
|
|
|
2.1 |
|
|
|
1.2 |
|
Impairment charges |
|
1.9 |
|
|
|
142.4 |
|
|
|
13.2 |
|
|
|
142.4 |
|
Tax expense (benefit) |
|
11.3 |
|
|
|
(50.5 |
) |
|
|
62.3 |
|
|
|
(19.9 |
) |
Interest expense |
|
14.7 |
|
|
|
45.0 |
|
|
|
51.5 |
|
|
|
94.5 |
|
Depreciation expense |
|
9.4 |
|
|
|
12.5 |
|
|
|
39.0 |
|
|
|
51.9 |
|
Acquisition related amortization
expense |
|
13.8 |
|
|
|
17.5 |
|
|
|
55.2 |
|
|
|
70.4 |
|
Acquisition related expenses |
|
9.9 |
|
|
|
0.8 |
|
|
|
10.6 |
|
|
|
1.5 |
|
Stock compensation expense |
|
3.2 |
|
|
|
4.7 |
|
|
|
15.3 |
|
|
|
15.7 |
|
Restructuring |
|
0.4 |
|
|
|
0.6 |
|
|
|
5.2 |
|
|
|
3.0 |
|
Consolidation costs |
|
1.7 |
|
|
|
— |
|
|
|
1.7 |
|
|
|
— |
|
Amortization of inventory fair
value adjustment |
|
— |
|
|
|
— |
|
|
|
2.4 |
|
|
|
— |
|
Customer accommodation and other
non-recurring charges |
|
3.0 |
|
|
|
— |
|
|
|
3.0 |
|
|
|
— |
|
Non-GAAP Adjusted EBITDA |
$ |
96.2 |
|
|
$ |
87.2 |
|
|
$ |
388.5 |
|
|
$ |
388.4 |
|
Non-GAAP Adjusted EBITDA as a
percent of net sales |
|
20.5 |
% |
|
|
18.6 |
% |
|
|
20.0 |
% |
|
|
20.4 |
% |
*Reconciliation of Non-GAAP Gross Profit and Non-GAAP Gross
Profit Margin:
|
Quarter Ended December 31, |
|
|
Year to Date Ended December 31, |
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Gross profit |
$ |
170.7 |
|
|
$ |
157.9 |
|
|
$ |
692.9 |
|
|
$ |
675.4 |
|
Gross profit as a percent of net sales |
|
36.4 |
% |
|
|
33.6 |
% |
|
|
35.6 |
% |
|
|
35.6 |
% |
Amortization of inventory fair
value adjustment |
|
— |
|
|
|
— |
|
|
|
2.4 |
|
|
|
— |
|
Consolidation costs |
|
0.7 |
|
|
|
— |
|
|
|
0.7 |
|
|
|
— |
|
Non-GAAP Gross Profit* |
$ |
171.4 |
|
|
$ |
157.9 |
|
|
$ |
696.0 |
|
|
$ |
675.4 |
|
Non-GAAP Gross Profit as a
percent of net sales* |
|
36.5 |
% |
|
|
33.6 |
% |
|
|
35.8 |
% |
|
|
35.6 |
% |
About Altra Industrial Motion Corp.
Altra Industrial Motion Corp. is a premier industrial global
manufacturer and supplier of highly engineered motion control,
automation, and power transmission systems and components. Altra's
portfolio consists of 26 well-respected brands including Bauer Gear
Motor, Boston Gear, Kollmorgen, Portescap, Stromag, Svendborg
Brakes, TB Wood's, Thomson and Warner Electric. Headquartered in
Braintree, Massachusetts, Altra has over 9,000 employees and 46
production facilities in 17 countries around the world.
|
|
|
|
|
|
Consolidated Balance
Sheets |
Years Ended December 31, |
|
In Millions of Dollars |
2022 |
|
|
2021 |
|
Assets: |
(Unaudited) |
|
|
|
|
Current Assets |
|
|
|
|
|
Cash and cash equivalents |
$ |
208.9 |
|
|
$ |
246.1 |
|
Trade receivables, net |
|
244.6 |
|
|
|
224.5 |
|
Inventories |
|
338.9 |
|
|
|
267.8 |
|
Income tax receivable |
|
8.9 |
|
|
|
11.7 |
|
Assets held for sale |
|
- |
|
|
|
377.3 |
|
Prepaid expenses and other current assets |
|
35.1 |
|
|
|
40.4 |
|
Total current assets |
|
836.4 |
|
|
|
1,167.8 |
|
Property, plant and equipment, net |
|
275.1 |
|
|
|
275.8 |
|
Intangible assets, net |
|
970.4 |
|
|
|
1,057.2 |
|
Goodwill |
|
1,524.5 |
|
|
|
1,564.0 |
|
Deferred income taxes |
|
7.5 |
|
|
|
2.3 |
|
Other non-current assets, net |
|
21.3 |
|
|
|
13.5 |
|
Operating lease right of use assets |
|
41.4 |
|
|
|
50.0 |
|
Total assets |
$ |
3,676.6 |
|
|
$ |
4,130.6 |
|
|
|
|
|
|
|
Liabilities and stockholders'
equity |
|
|
|
|
|
Current liabilities |
|
|
|
|
|
Accounts payable |
$ |
165.8 |
|
|
$ |
173.3 |
|
Accrued payroll |
|
67.9 |
|
|
|
81.8 |
|
Accruals and other current liabilities |
|
88.4 |
|
|
|
77.0 |
|
Income tax payable |
|
22.4 |
|
|
|
6.0 |
|
Current portion of long-term debt |
|
20.4 |
|
|
|
11.1 |
|
Liabilities held for sale |
|
- |
|
|
|
53.0 |
|
Operating lease liabilities |
|
12.4 |
|
|
|
14.3 |
|
Total current liabilities |
|
377.3 |
|
|
|
416.5 |
|
Long-term debt, less current portion and net of unaccreted
discount |
|
1,024.1 |
|
|
|
1,401.0 |
|
Deferred income taxes |
|
216.8 |
|
|
|
250.5 |
|
Pension liabilities |
|
17.3 |
|
|
|
29.9 |
|
Long-term taxes payable |
|
1.8 |
|
|
|
2.7 |
|
Other long-term liabilities |
|
6.3 |
|
|
|
7.3 |
|
Operating lease liabilities, net of current portion |
|
30.6 |
|
|
|
37.6 |
|
Total stockholders'
equity |
|
2,002.4 |
|
|
|
1,985.1 |
|
Total liabilities, and
stockholders' equity |
$ |
3,676.6 |
|
|
$ |
4,130.6 |
|
|
|
|
|
|
|
Reconciliation to operating
working capital: |
|
|
|
|
|
Trade receivables, net |
|
244.6 |
|
|
|
224.5 |
|
Inventories |
|
338.9 |
|
|
|
267.8 |
|
Accounts payable |
|
(165.8 |
) |
|
|
(173.3 |
) |
Non-GAAP operating working
capital* |
$ |
417.7 |
|
|
$ |
319.0 |
|
Consolidated
Statements of Income Data: |
Quarter Ended December 31, |
|
|
Year Ended December 31, |
|
|
In Millions of Dollars, except
per share amounts |
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
|
(Unaudited) |
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
Net sales |
$ |
469.4 |
|
|
$ |
469.8 |
|
|
$ |
1,945.5 |
|
|
$ |
1,899.8 |
|
|
Cost of sales |
|
298.7 |
|
|
|
311.9 |
|
|
|
1,252.6 |
|
|
|
1,224.4 |
|
|
Gross profit |
|
170.7 |
|
|
|
157.9 |
|
|
|
692.9 |
|
|
|
675.4 |
|
|
Gross profit as a percent of net sales |
|
36.4 |
% |
|
|
33.6 |
% |
|
|
35.6 |
% |
|
|
35.6 |
% |
|
Selling, general &
administrative expenses |
|
102.3 |
|
|
|
93.5 |
|
|
|
370.0 |
|
|
|
368.7 |
|
|
Impairment charges |
|
1.9 |
|
|
|
142.4 |
|
|
|
13.2 |
|
|
|
142.4 |
|
|
Research and development
expenses |
|
15.5 |
|
|
|
16.4 |
|
|
|
64.1 |
|
|
|
63.9 |
|
|
Restructuring |
|
0.4 |
|
|
|
0.6 |
|
|
|
5.2 |
|
|
|
3.0 |
|
|
Income (loss) from operations |
|
50.6 |
|
|
|
(95.0 |
) |
|
|
240.4 |
|
|
|
97.4 |
|
|
Income (loss) from operations as a percent of net sales |
|
10.8 |
% |
|
|
-20.2 |
% |
|
|
12.4 |
% |
|
|
5.1 |
% |
|
Interest expense, net |
|
14.7 |
|
|
|
45.0 |
|
|
|
51.5 |
|
|
|
94.5 |
|
|
Other non-operating expense
(income), net |
|
2.3 |
|
|
|
(1.8 |
) |
|
|
(0.4 |
) |
|
|
(4.9 |
) |
|
Income (loss) before income
taxes |
|
33.6 |
|
|
|
(138.2 |
) |
|
|
189.3 |
|
|
|
7.8 |
|
|
Provision/(Benefit) for income
taxes |
|
11.3 |
|
|
|
(50.5 |
) |
|
|
62.3 |
|
|
|
(19.9 |
) |
|
Income tax rate |
|
33.6 |
% |
|
|
36.5 |
% |
|
|
32.9 |
% |
|
|
-255.1 |
% |
|
Net income/(loss) |
$ |
22.3 |
|
|
$ |
(87.7 |
) |
|
$ |
127.0 |
|
|
$ |
27.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average common shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
65.2 |
|
|
|
64.9 |
|
|
|
65.1 |
|
|
|
64.8 |
|
|
Diluted |
|
65.6 |
|
|
|
64.9 |
|
|
|
65.4 |
|
|
|
65.4 |
|
|
Net income/(loss) per
share: |
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.34 |
|
|
$ |
(1.35 |
) |
|
$ |
1.95 |
|
|
$ |
0.43 |
|
|
Diluted |
$ |
0.34 |
|
|
$ |
(1.35 |
) |
|
$ |
1.94 |
|
|
$ |
0.42 |
|
|
|
|
Years Ended December 31, |
|
|
|
2022 |
|
|
2021 |
|
Cash flows from operating
activities |
|
(Unaudited) |
|
|
|
|
Net income/(loss) |
|
$ |
127.0 |
|
|
$ |
27.7 |
|
Adjustments to reconcile net
income to net cash flows: |
|
|
|
|
|
|
Depreciation |
|
|
39.0 |
|
|
|
51.9 |
|
Amortization of intangible assets |
|
|
55.2 |
|
|
|
70.4 |
|
Amortization of deferred financing costs |
|
|
1.0 |
|
|
|
4.0 |
|
Loss on foreign currency, net |
|
|
1.8 |
|
|
|
1.5 |
|
Accretion of debt discount |
|
|
0.2 |
|
|
|
0.4 |
|
Non-cash amortization of interest rate swap expense |
|
|
— |
|
|
|
25.7 |
|
Impairment charges |
|
|
13.2 |
|
|
|
142.4 |
|
Unrealized gain on investment in MTEK Industry AB |
|
|
(0.7 |
) |
|
|
— |
|
Loss (gain) on disposals and other |
|
|
0.3 |
|
|
|
(0.3 |
) |
Loss on extinguishment of debt |
|
|
— |
|
|
|
15.4 |
|
Loss on debt redemption |
|
|
0.1 |
|
|
|
— |
|
Benefit for deferred taxes |
|
|
(32.1 |
) |
|
|
(82.1 |
) |
Stock based compensation |
|
|
15.3 |
|
|
|
15.7 |
|
Amortization of inventory fair value adjustment |
|
|
2.4 |
|
|
|
— |
|
Changes in assets and liabilities, net of assets acquired: |
|
|
|
|
|
|
Trade receivables |
|
|
(37.6 |
) |
|
|
4.4 |
|
Inventories |
|
|
(79.0 |
) |
|
|
(67.4 |
) |
Accounts payable and accrued liabilities |
|
|
6.0 |
|
|
|
37.0 |
|
Other current assets and liabilities |
|
|
19.5 |
|
|
|
(22.4 |
) |
Other operating assets and liabilities |
|
|
(6.6 |
) |
|
|
(7.3 |
) |
Net cash provided by operating activities |
|
$ |
125.0 |
|
|
$ |
217.0 |
|
Cash flows from investing
activities |
|
|
|
|
|
|
Purchase of property, plant and
equipment |
|
|
(55.9 |
) |
|
|
(40.6 |
) |
Proceeds from sale of
property |
|
|
— |
|
|
|
2.2 |
|
Proceeds from sale of JVS
business |
|
|
321.7 |
|
|
|
— |
|
Investment in MTEK Industry
AB |
|
|
(4.6 |
) |
|
|
— |
|
Acquisition of Nook Industries,
net of cash acquired |
|
|
(8.1 |
) |
|
|
(125.2 |
) |
A&S Business acquisition
purchase price adjustment |
|
|
— |
|
|
|
— |
|
Net cash provided by (used in) investing activities |
|
$ |
253.1 |
|
|
$ |
(163.6 |
) |
Cash flows from financing
activities |
|
|
|
|
|
|
Payments of debt issuance
costs |
|
|
— |
|
|
|
(3.7 |
) |
Payments on Term Loan B
Facility |
|
|
— |
|
|
|
(1,030.0 |
) |
Payments on Revolving Credit
Facility |
|
|
(355.0 |
) |
|
|
(5.0 |
) |
Payments on Term Loan A
Facility |
|
|
(10.0 |
) |
|
|
— |
|
Borrowing under Term Loan A
Facility |
|
|
— |
|
|
|
400.0 |
|
Borrowing under Revolving Credit
Facility |
|
|
15.0 |
|
|
|
610.0 |
|
Repurchase of Notes |
|
|
(16.4 |
) |
|
|
— |
|
Dividend payments |
|
|
(22.3 |
) |
|
|
(18.3 |
) |
Payments of equipment, working
capital notes, mortgages and other debt |
|
|
(1.1 |
) |
|
|
(5.9 |
) |
Proceeds from equipment, working
capital notes, mortgages and other debt |
|
|
0.2 |
|
|
|
3.7 |
|
Shares surrendered for tax
withholding |
|
|
(6.1 |
) |
|
|
(5.5 |
) |
Proceeds from issuance of common
stock upon exercise of options |
|
|
— |
|
|
|
2.2 |
|
Net cash used in financing activities |
|
$ |
(395.7 |
) |
|
$ |
(52.5 |
) |
Effect of exchange rate changes
on cash and cash equivalents |
|
|
(19.6 |
) |
|
|
(9.2 |
) |
Net change in cash and cash equivalents |
|
|
(37.2 |
) |
|
|
(8.3 |
) |
Cash and cash equivalents at
beginning of year |
|
|
246.1 |
|
|
|
254.4 |
|
Cash and cash equivalents at end
of period |
|
$ |
208.9 |
|
|
$ |
246.1 |
|
|
|
|
|
|
|
|
Reconciliation to free cash
flow: |
|
|
|
|
|
|
Net cash flows from operating
activities |
|
|
125.0 |
|
|
|
217.0 |
|
Purchase of property, plant
and equipment |
|
|
(55.9 |
) |
|
|
(40.6 |
) |
Non-GAAP Free Cash Flow * |
|
|
69.1 |
|
|
|
176.4 |
|
JVS transaction costs
paid |
|
|
8.6 |
|
|
|
— |
|
Tax paid for JVS
divestiture |
|
|
21.4 |
|
|
|
— |
|
Non-GAAP Adjusted Free Cash
Flow * |
|
$ |
99.1 |
|
|
$ |
176.4 |
|
Selected Segment
Data |
|
Quarter Ended December 31, |
|
|
Year Ended December 31, |
|
In Millions of
Dollars, except per share amount |
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Net
Sales: |
|
|
|
|
|
|
|
|
|
|
|
|
Power Transmission Technologies |
|
$ |
240.1 |
|
|
$ |
233.7 |
|
|
$ |
985.6 |
|
|
$ |
924.8 |
|
Automation & Specialty |
|
|
230.4 |
|
|
|
237.1 |
|
|
|
965.5 |
|
|
|
979.0 |
|
Inter-segment eliminations |
|
|
(1.1 |
) |
|
|
(1.0 |
) |
|
|
(5.6 |
) |
|
|
(4.0 |
) |
Total |
|
$ |
469.4 |
|
|
$ |
469.8 |
|
|
$ |
1,945.5 |
|
|
$ |
1,899.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) from
operations: |
|
|
|
|
|
|
|
|
|
|
|
|
Power Transmission
Technologies |
|
$ |
32.7 |
|
|
$ |
30.7 |
|
|
$ |
136.8 |
|
|
$ |
128.6 |
|
Automation & Specialty |
|
|
34.8 |
|
|
$ |
(117.7 |
) |
|
|
136.0 |
|
|
|
(8.3 |
) |
Corporate |
|
|
(16.5 |
) |
|
$ |
(7.4 |
) |
|
|
(27.2 |
) |
|
|
(19.9 |
) |
Restructuring |
|
|
(0.4 |
) |
|
$ |
(0.6 |
) |
|
|
(5.2 |
) |
|
|
(3.0 |
) |
Total |
|
$ |
50.6 |
|
|
$ |
(95.0 |
) |
|
$ |
240.4 |
|
|
$ |
97.4 |
|
*Reconciliation of Non-GAAP Income from Operations by
Segment:
Selected Segment
Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In Millions of Dollars |
|
Quarter Ended December 31, 2022 |
|
|
Year to Date Ended December 31, 2022 |
|
|
|
Power Transmission Technologies |
|
|
Automation andSpecialty |
|
|
Corporate |
|
|
Restructuring |
|
|
Total |
|
|
Power Transmission Technologies |
|
|
Automation and Specialty |
|
|
Corporate |
|
|
Restructuring |
|
|
Total |
|
Income (loss) from
operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from operations |
|
$ |
32.7 |
|
|
$ |
34.8 |
|
|
$ |
(16.5 |
) |
|
$ |
(0.4 |
) |
|
$ |
50.6 |
|
|
$ |
136.8 |
|
|
$ |
136.0 |
|
|
$ |
(27.2 |
) |
|
$ |
(5.2 |
) |
|
$ |
240.4 |
|
Restructuring |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.4 |
|
|
|
0.4 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5.2 |
|
|
|
5.2 |
|
Consolidation costs |
|
|
1.7 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1.7 |
|
|
|
1.7 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1.7 |
|
Acceleration of stock
compensation expense upon retirement |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.6 |
|
|
|
— |
|
|
|
0.6 |
|
Acquisition related
amortization expense |
|
|
2.0 |
|
|
|
11.8 |
|
|
|
— |
|
|
|
— |
|
|
|
13.8 |
|
|
|
8.1 |
|
|
|
47.1 |
|
|
|
— |
|
|
|
— |
|
|
|
55.2 |
|
Impairment charges |
|
|
— |
|
|
|
1.9 |
|
|
|
— |
|
|
|
— |
|
|
|
1.9 |
|
|
|
3.0 |
|
|
|
10.2 |
|
|
|
— |
|
|
|
— |
|
|
|
13.2 |
|
Acquisition related
expenses |
|
|
— |
|
|
|
— |
|
|
|
9.9 |
|
|
|
— |
|
|
|
9.9 |
|
|
|
— |
|
|
|
— |
|
|
|
10.6 |
|
|
|
— |
|
|
|
10.6 |
|
Amortization of inventory fair
value adjustment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2.4 |
|
|
|
— |
|
|
|
— |
|
|
|
2.4 |
|
Total Non-GAAP Income from
operations |
|
$ |
36.4 |
|
|
$ |
48.5 |
|
|
$ |
(6.6 |
) |
|
$ |
— |
|
|
$ |
78.3 |
|
|
$ |
149.6 |
|
|
$ |
195.7 |
|
|
$ |
(16.0 |
) |
|
$ |
— |
|
|
$ |
329.3 |
|
Non-GAAP Income from operations
as a percentage of Segment net sales* |
|
|
15.2 |
% |
|
|
21.1 |
% |
|
|
|
|
|
|
|
|
16.7 |
% |
|
|
15.2 |
% |
|
|
20.3 |
% |
|
|
|
|
|
|
|
|
16.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Segment
Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In Millions of Dollars |
|
Quarter Ended December 31, 2021 |
|
|
Year to Date Ended December 31, 2021 |
|
|
|
Power Transmission Technologies |
|
|
Automation and Specialty |
|
|
Corporate |
|
|
Restructuring |
|
|
Total |
|
|
Power Transmission Technologies |
|
|
Automation and Specialty |
|
|
Corporate |
|
|
Restructuring |
|
|
Total |
|
Income from
operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations |
|
$ |
30.7 |
|
|
$ |
(117.7 |
) |
|
$ |
(7.4 |
) |
|
$ |
(0.6 |
) |
|
$ |
(95.0 |
) |
|
$ |
128.6 |
|
|
$ |
(8.3 |
) |
|
$ |
(19.9 |
) |
|
$ |
(3.0 |
) |
|
$ |
97.4 |
|
Restructuring |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
0.6 |
|
|
|
0.6 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3.0 |
|
|
|
3.0 |
|
Acquisition related stock
compensation expense |
|
|
— |
|
|
|
— |
|
|
|
0.2 |
|
|
|
— |
|
|
|
0.2 |
|
|
|
— |
|
|
|
— |
|
|
|
0.9 |
|
|
|
— |
|
|
|
0.9 |
|
Acceleration of stock
compensation expense upon retirement |
|
|
— |
|
|
|
— |
|
|
|
1.3 |
|
|
|
— |
|
|
|
1.3 |
|
|
|
— |
|
|
|
— |
|
|
|
1.3 |
|
|
|
— |
|
|
|
1.3 |
|
Acquisition related
amortization expense |
|
|
2.1 |
|
|
|
15.4 |
|
|
|
— |
|
|
|
— |
|
|
|
17.5 |
|
|
|
8.5 |
|
|
|
61.9 |
|
|
|
— |
|
|
|
— |
|
|
|
70.4 |
|
Impairment of goodwill and
intangible asset |
|
|
— |
|
|
|
142.4 |
|
|
|
— |
|
|
|
— |
|
|
|
142.4 |
|
|
|
— |
|
|
|
142.4 |
|
|
|
— |
|
|
|
— |
|
|
|
142.4 |
|
Acquisition related
expenses |
|
|
— |
|
|
|
— |
|
|
|
0.8 |
|
|
|
— |
|
|
|
0.8 |
|
|
|
— |
|
|
|
— |
|
|
|
1.5 |
|
|
|
— |
|
|
|
1.5 |
|
Total Non-GAAP Income from
operations |
|
$ |
32.8 |
|
|
$ |
40.1 |
|
|
$ |
(5.1 |
) |
|
$ |
— |
|
|
$ |
67.8 |
|
|
$ |
137.1 |
|
|
$ |
196.0 |
|
|
$ |
(16.2 |
) |
|
$ |
— |
|
|
$ |
316.9 |
|
Non-GAAP Income from operations
as a percentage of Segment net sales* |
|
|
14.0 |
% |
|
|
16.9 |
% |
|
|
|
|
|
|
|
|
14.4 |
% |
|
|
14.8 |
% |
|
|
20.0 |
% |
|
|
|
|
|
|
|
|
16.7 |
% |
*Discussion of Non-GAAP Financial Measures
The non-GAAP financial measures used in this release are
utilized by management in comparing our operating performance on a
consistent basis. We believe that these financial measures are
appropriate to enhance the overall understanding of our underlying
operating performance trends compared to historical and prospective
periods and our peers. We believe that these measures provide
important supplemental information to management and investors
regarding financial and business trends relating to the Company's
financial condition and results of operations as well as insight
into the compliance with our debt covenants. Non-GAAP financial
measures should not be considered in isolation from, or as a
substitute for, financial information calculated in accordance with
GAAP. Investors are encouraged to review the reconciliation of
these non-GAAP measures to their most directly comparable GAAP
financial measures. Our industry peers may provide similar
supplemental non-GAAP information with respect to one or more of
these measures, although they may not use the same or comparable
terminology and may not make identical adjustments. A
reconciliation of non-GAAP financial measures presented above to
our GAAP results has been provided in the financial tables included
in this press release.
Organic Sales and Organic Sales Growth
Organic Sales in this release are net sales excluding the impact
of foreign currency translation and acquisitions. Organic Sales can
be expressed as a dollar amount or a percentage rate when
describing Organic Sales Growth.
Non-GAAP Net Income, Non-GAAP Net Income Margin, Non-GAAP Income
From Operations, Non-GAAP Diluted Earnings Per Share and Non-GAAP
Operating Income Margin
Non-GAAP Net Income, Non-GAAP Net Income Margin, Non-GAAP Income
From Operations and Non-GAAP Diluted Earnings Per Share exclude, as
applicable to the particular period, acquisition related
amortization expense, acquisition related expense, acquisition
related stock compensation expense, restructuring and consolidation
costs, non-cash amortization of interest rate swap expense,
non-cash interest rate swap settlement fee, customer accommodations
and other income or charges that management does not consider to be
directly related to the Company’s core operating performance.
Non-GAAP Net Income Margin is calculated by dividing Non-GAAP Net
Income by GAAP Net Sales. Non-GAAP Diluted Earnings Per Share is
calculated by dividing Non-GAAP Net Income by GAAP weighted average
shares outstanding (diluted). Non-GAAP Operating Income Margin is
calculated by dividing Non-GAAP Income From Operations by GAAP Net
Sales.
Non-GAAP Gross Profit and Non-GAAP Gross Profit Margin
Non-GAAP gross profit excludes amortization of inventory fair
value adjustment and certain consolidation costs. Non-GAAP gross
profit margin is calculated by dividing Non-GAAP gross profit by
GAAP Net Sales.
Non-GAAP Adjusted EBITDA
Non-GAAP Adjusted EBITDA represents earnings before interest,
taxes, depreciation, acquisition related amortization, acquisition
related costs, restructuring costs, consolidation costs, customer
accommodations, stock-based compensation, asset impairment and
other income or charges that management does not consider to be
directly related to the Company’s core operating performance.
Non-GAAP Adjusted EBITDA Margin
Non-GAAP Adjusted EBITDA Margin is calculated by dividing
Non-GAAP Adjusted EBITDA by GAAP Net Sales.
Non-GAAP Free Cash Flow
Non-GAAP Free Cash Flow is calculated by deducting purchases of
property, plant and equipment.
Non-GAAP Adjusted Free Cash Flow
Non-GAAP Adjusted Free Cash Flow is calculated by deducting
purchases of property, plant and equipment and adding back the JVS
transaction costs paid and tax paid as a result of the JVS
divestiture.
Non-GAAP Operating Working Capital
Non-GAAP Operating Working Capital is calculated by deducting
accounts payable from net trade receivables plus inventories.
Net Debt
Net Debt is calculated by subtracting cash and cash equivalents
from total gross debt.
Forward-Looking Statements
All statements, other than statements of historical fact
included in this release are forward-looking statements, as that
term is defined in the Private Securities Litigation Reform Act of
1995. These statements include, but are not limited to, any
statement that may predict, forecast, indicate or imply future
results, performance, achievements or events. Forward-looking
statements can generally be identified by phrases such as
“believes,” “expects,” “potential,” “continues,” “may,” “should,”
“seeks,” “predicts,” “anticipates,” “intends,” “projects,”
“estimates,” “plans,” “could,” “designed”, “should be,” "will,”
“guidance,” “outlook,” and other similar expressions that denote
expectations of future or conditional events rather than statements
of fact. Forward-looking statements also may relate to strategies,
plans and objectives for, and potential results of, future
operations, financial results, financial condition, business
prospects, growth strategy and liquidity, and are based upon
financial data, market assumptions and management's current
business plans and beliefs or current estimates of future results
or trends available only as of the time the statements are made,
which may become out of date or incomplete. Forward looking
statements are inherently uncertain, and investors must recognize
that events could differ significantly from our expectations. These
statements include, but may not be limited to, statements related
to management’s expectations regarding the Company’s transaction
with Parent, the Company’s strategy to position itself as a
high-value technology leader across attractive industrial markets
continuing to support a resilient performance at both the top and
bottom lines and the Company’s ongoing commitment to delivering
excellent results for its stakeholders.
In addition to the risks and uncertainties noted in this
release, there are certain factors that could cause actual results
to differ materially from those anticipated by some of the
statements made. These include: (1) competitive pressures, (2)
changes in political and economic conditions in the United States
and abroad, including, but not limited to, changes as a result of
the war in Ukraine, and the cyclical nature of our markets, (3)
loss of distributors, (4) the ability to develop new products and
respond to customer needs, (5) risks associated with international
operations, including currency risks, and the effects of tariffs
and other trade actions taken by the United States and other
countries, (6) accuracy of estimated forecasts of OEM customers and
the impact of the current global economic environment on our
customers, (7) risks associated with a disruption to our supply
chain including the impact of the global semiconductor chip
shortage, (8) fluctuations in the costs of raw materials used in
our products, (9) product liability claims, (10) work stoppages and
other labor issues involving the Company’s facilities or the
Company’s customers, (11) changes in employment, environmental, tax
and other laws and changes in the enforcement of laws, (12) loss of
key management and other personnel, (13) risks associated with
compliance with environmental laws, (14) the ability to
successfully execute, manage and integrate key acquisitions and
mergers, (15) failure to obtain or protect intellectual property
rights, (16) impairment or reduction of goodwill or intangible
assets, (17) failure of operating equipment or information
technology infrastructure, including cyber-attacks or other
security breaches, and failure to comply with data privacy laws or
regulations, (18) risks associated with our debt leverage, (19)
risks associated with restrictions contained in the agreements
governing Altra’s $400.0 million aggregate principal amount of
6.125% senior notes due 2026 and Altra’s revolving credit facility
and term loan facility, (20) risks associated with compliance with
tax laws, (21) risks associated with the global recession and
volatility and disruption in the global financial markets, (22)
risks associated with enhancements to our enterprise resource
planning system, (23) risks associated with the Nook Industries and
A&S acquisitions and integration and other acquisitions, (24)
risks associated with certain minimum purchase agreements we have
with suppliers, (25) risks related to our relationships with
strategic partners, (26) our ability to offset increased commodity
and labor costs with increased prices, (27) risks associated with
our exposure to variable interest rates and foreign currency
exchange rates, (28) disruption of our supply chain, (29) risks
associated with our exposure to renewable energy markets, (30)
risks related to regulations regarding conflict minerals, (31)
risks related to restructuring and plant consolidations, (32)
exposure to United Kingdom political developments, including the
effect of its withdrawal from the European Union, and the
uncertainty surrounding the effect of Brexit and related negative
developments in the European Union and elsewhere, (33) Altra’s
ability to achieve the efficiencies, savings and other benefits
anticipated from its cost reduction, margin improvement,
restructuring, plant consolidation and other business optimization
initiatives, (34) the risks associated with transitioning from
LIBOR to a replacement alternative reference rate, (35) the scope
and duration of the COVID-19 global pandemic and its impact on
global economic systems and our employees, sites, operations,
customers and supply chain, including the impact of the pandemic on
manufacturing and supply capabilities throughout the world, (36)
adverse conditions in the credit and capital markets limiting or
preventing the Company’s and its customers’ and suppliers’ ability
to borrow or raise capital, (37) the Company’s ability to invest in
new technologies and manufacturing techniques and to develop or
adapt to changing technology and manufacturing techniques, (38)
defects, quality issues, inadequate disclosure or misuse with
respect to our products and capabilities, (39) changes in labor or
employment laws, (40) the Company’s ability to recruit, retain and
motivate key sales, marketing or engineering personnel, (41)
unplanned repairs or equipment outages, (42) changes in the
Company’s tax rates, or exposure to additional income tax
liabilities or assessments, as well as audits by tax authorities,
(43) the risks associated with the Company’s ability to
successfully divest or otherwise dispose of businesses that are
deemed not to fit with our strategic plan or are not achieving the
desired return on investment, (44) the ongoing military action
between Russia and Ukraine and (45) other risks, uncertainties and
other factors described in the Company's quarterly reports on Form
10-Q and annual reports on Form 10-K and in the Company's other
filings with the U.S. Securities and Exchange Commission (SEC) or
in materials incorporated therein by reference. Except as required
by applicable law, Altra does not intend to update or alter its
forward-looking statements, whether as a result of new information,
future events or otherwise.
AIMC-E
CONTACT:
Altra Investor Relations
781-917-0600
Email: ir@altramotion.com
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