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Shiloh Industries Reports First Quarter 2013 Results

VALLEY CITY, OH--(Marketwire - Mar 1, 2013) - Shiloh Industries, Inc. ( NASDAQ : SHLO ) today reported financial results for the first quarter of its fiscal year ending Oct. 31, 2013.

First Quarter Highlights:

  • Sales revenue for the quarter ended Jan. 31, 2013 increased to $145.4 million, a 9.8 percent increase from the first quarter a year earlier.

  • Gross profit for the quarter improved 21.7 percent to $11.8 million, or 8.1 percent of sales revenue compared to the prior year quarter.

  • Operating income for the quarter improved 34.2 percent to $4.1 million, compared to the prior year quarter.

  • Net income per share diluted improved 66.7 percent to $0.15 for the quarter, compared to net income of $0.09 per share diluted in the prior year quarter. 

  • The company declared and paid a special dividend of $0.25 per share during the quarter.

First Quarter 2013 Results:

The company reported revenue of $145.4 million for the first quarter ended Jan. 31, 2013, an increase of 9.8 percent over the $132.4 million in the same quarter of the previous year. Sales reflect an increase in the North American car and light truck industry production volume of 6.8 percent compared to the first quarter of the prior year and new business wins.

Gross profit for the first quarter increased 21.7 percent to $11.8 million, or 8.1 percent of sales, compared to $9.7 million or 7.3 percent of sales for the first quarter of 2012. Improved productivity, increased sales volume and reductions in fixed manufacturing expenses contributed to the increase.

For the first quarter, operating income improved 34.2 percent to $4.1 million, compared to $3.1 million in the first quarter of the previous year.

The company reported net income for the first quarter of fiscal year 2013 of $2.6 million or $0.15 per share diluted, compared to the first quarter of 2012 net income of $1.6 million or $0.09 per share diluted.

"Shiloh's improved profitability is being driven by increased revenue as a result of higher volume in the North American vehicle production levels, new sales activities, and our continued focus on operating efficiency improvements and effective cost management," said Ramzi Hermiz, President and CEO. "As we move forward through fiscal 2013, we remain optimistic about industry trends and vehicle demand in North America. We will continue to evaluate opportunities for growth, and will remain true to our key tenants of leading with technology and innovation, achieving sustainable global profitable growth and acting with a sense of purpose and speed."

Headquartered in Valley City, Ohio, Shiloh Industries is a leading supplier, providing light weighting and noise, vibration and harshness (NVH) solutions to automotive, commercial vehicle and other industrial markets. Shiloh delivers these solutions through design, engineering and manufacturing of first operation blanks, engineered welded blanks, complex stampings, modular assemblies and highly engineered aluminum die casting and machined components serving the body-in-white, emission, powertrain, structural and seating needs of OEM and Tier 1 customers. The company has 16 wholly owned subsidiaries at locations in Alabama, Ohio, Georgia, Michigan, Tennessee, Kentucky, Wisconsin and Mexico, and has approximately 1,770 employees.

A conference call to discuss first quarter of fiscal 2013 results will be held on Friday, March 1, 2013, at 10:00 a.m. EST. To listen to the conference call, dial (888) 389-5988 approximately five minutes prior to the start time and request the Shiloh Industries first quarter conference call.

Certain statements made by Shiloh Industries, Inc. in this release and other periodic oral and written statements, including filings with the Securities and Exchange Commission, regarding the Company's operating performance, events or developments that the Company believes or expects to occur in the future, including those that discuss strategies, goals, outlook or other non-historical matters, or which relate to future sales, earnings expectations, cost savings, awarded sales, volume growth, earnings or general belief in the Company's expectations of future operating results are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements are made on the basis of management's assumptions and expectations. As a result, there can be no guarantee or assurance that these assumptions and expectations will in fact occur. The forward-looking statements are subject to risks and uncertainties that may cause actual results to materially differ from those contained in the statements. Some, but not all of the risks, include the ability of the Company to accomplish its strategic objectives with respect to implementing its sustainable business model; the ability to obtain future sales; changes in worldwide economic and political conditions, including adverse effects from terrorism or related hostilities; costs related to legal and administrative matters; the Company's ability to realize cost savings expected to offset price concessions; the Company's ability to successfully integrate acquired business; inefficiencies related to production and product launches that are greater than anticipated; changes in technology and technological risks; increased fuel and utility costs; work stoppages and strikes at the Company's facilities and that of the Company's customers or suppliers; the Company's dependence on the automotive and heavy truck industries, which are highly cyclical; the dependence of the automotive industry on consumer spending, which is subject to the impact of domestic and international economic conditions, including increased energy costs affecting car and light truck production, and regulations and policies regarding international trade; financial and business downturns of the Company's customers or vendors, including any production cutbacks or bankruptcies; increases in the price of, or limitations on the availability of, steel, the Company's primary raw material, or decreases in the price of scrap steel; the successful launch and consumer acceptance of new vehicles for which the Company supplies parts; the occurrence of any event or condition that may be deemed a material adverse effect under the Credit Agreement or a decrease in customer demand which could cause a covenant default under the Credit Agreement; pension plan funding requirements; and other factors, uncertainties, challenges and risks detailed in the Company's other public filings with the Securities and Exchange Commission. Any or all of these risks and uncertainties could cause actual results to differ materially from those reflected in the forward-looking statements. These forward-looking statements reflect management's analysis only as of the date of this release.

The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. In addition to the disclosures contained herein, readers should carefully review risks and uncertainties contained in other documents the Company files from time to time with the Securities and Exchange Commission.

(Dollar amounts in thousands)  
January 31,

    October 31,
Cash and cash equivalents   $ 140     $ 174  
Accounts receivable, net of allowance for doubtful accounts of $421 and $482 at January 31, 2013 and October 31, 2012, respectively     78,160       77,556  
Related-party accounts receivable     2,202       536  
Income tax receivable     392       1,201  
Inventories, net     47,592       44,687  
Deferred income taxes     2,205       2,153  
Prepaid expenses     3,773       1,532  
    Total current assets     134,464       127,839  
Property, plant and equipment, net     153,503       117,101  
Goodwill     7,220       --  
Intangible assets, net     11,412       --  
Deferred income taxes     4,539       3,294  
Other assets     1,100       868  
    Total assets   $ 312,238     $ 249,102  
Current debt   $ 224     $ 447  
Accounts payable     55,085       63,633  
Other accrued expenses     20,813       21,395  
    Total current liabilities     76,122       85,475  
Long-term debt     95,700       21,150  
Long-term benefit liabilities     31,927       32,819  
Other liabilities     2,330       2,255  
    Total liabilities     206,079       141,699  
Commitments and contingencies                
Stockholders' equity:                
  Preferred stock, $.01 per share; 5,000,000 shares authorized; no shares issued and outstanding at January 31, 2013 and October 31, 2012, respectively     --       --  
  Common stock, par value $.01 per share; 25,000,000 shares authorized; 16,997,179 and 16,983,012 shares issued and outstanding at January 31, 2013 and October 31, 2012, respectively     169       169  
  Paid-in capital     65,539       65,120  
  Retained earnings     71,762       73,425  
  Accumulated other comprehensive loss: Pension related liability, net     (31,311 )     (31,311 )
    Total stockholders' equity     106,159       107,403  
    Total liabilities and stockholders' equity   $ 312,238     $ 249,102  
(Amounts in thousands, except per share data)  
    Three Months Ended
January 31,
    2013     2012  
Revenues   $ 145,383     $ 132,371  
Cost of sales     133,622       122,709  
  Gross profit     11,761       9,662  
Selling, general and administrative expenses     7,637       6,648  
Asset recovery     (7 )     (65 )
  Operating income     4,131       3,079  
Interest expense     430       285  
Interest income     6       --  
Other income (expense), net     (23 )     47  
  Income before income taxes     3,684       2,841  
Provision for income taxes     1,101       1,262  
  Net income   $ 2,583     $ 1,579  
Earnings per share:                
Basic earnings per share   $ 0.15     $ 0.09  
Basic weighted average number of common shares     16,988       16,765  
Diluted earnings per share   $ 0.15     $ 0.09  
Diluted weighted average number of common shares     17,040       16,856  
(Dollar amounts in thousands)
    Three Months Ended
January 31,
    2013   2012
Net income   $ 2,583   $ 1,579
Other comprehensive income (loss), net of tax:            
  Defined benefit pension plans & other postretirement benefits     --     --
Comprehensive income, net   $ 2,583   $ 1,579
(Dollar amounts in thousands)  
    Three Months Ended
January 31,
    2013     2012  
  Net income   $ 2,583     $ 1,579  
  Adjustments to reconcile net income to net cash provided by operating activities:                
    Depreciation and amortization     4,252       5,054  
    Asset recovery     (7 )     --  
    Recovery of restructuring charge     --       (65 )
    Amortization of deferred financing costs     75       87  
    Deferred income taxes     5       (14 )
    Stock-based compensation expense     187       209  
    Gain on sale of assets     --       18  
  Changes in operating assets and liabilities:                
      Accounts receivable     6,908       (3,057 )
      Inventories     1,265       (2,805 )
      Prepaids and other assets     (283 )     305  
      Payables and other liabilities     (17,477 )     (2,640 )
      Accrued income taxes     808       1,100  
        Net cash provided by operating activities     (1,684 )     (229 )
    Capital expenditures     (5,769 )     (1,983 )
    Acquisitions, net of cash acquired     (62,684 )     --  
    Proceeds from sale of assets     7       137  
        Net cash used in investing activities     (68,446 )     (1,846 )
    Payment of dividends     (4,226 )     --  
    Proceeds from long-term borrowings     78,850       4,900  
    Repayments of long-term borrowings     (4,300 )     (2,600 )
    Payment of deferred financing costs     (307 )     (40 )
    Proceeds from exercise of stock options     79       17  
        Net cash provided by in financing activities     70,096       2,277  
Net increase (decrease) in cash and cash equivalents     (34 )     202  
Cash and cash equivalents at beginning of period     174       20  
Cash and cash equivalents at end of period   $ 140     $ 222  
Supplemental Cash Flow Information:                
Cash paid for interest   $ 331     $ 289  
Cash paid for income taxes   $ 61     $ 89