================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
May 13, 2004
Date of Report (Date of earliest event reported)
TRIMAS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 333-100351 38-2687639
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) file number) Identification No.)
39400 Woodward Ave., Ste. 130
Bloomfield Hills, MI 48304
(Address of principal executive offices)
(248) 631-5450
(Registrant's telephone number, including
area code)
Not Applicable
(Former name or former address, if changed since last report)
================================================================================
Item 7. Exhibits.
(c) Exhibits. The following exhibit is filed herewith:
Exhibit No. Description
- ----------- -----------
99.1 Press Release.
99.2 TriMas Corporation (the "Company") visual presentation titled
"First Quarter 2004 Review," available at
http://www.trimascorp.com
Item 12. Results of Operations and Financial Condition.
The Company's only public securityholders are holders of its 9 7/8% senior
subordinated notes due 2012. The Company held a teleconference on May 13, 2004
reporting its financial results for the first quarter for the fiscal year 2004.
The Company issued a press release containing information reported on the
teleconference. Audio replay of the teleconference and a copy of the visual
presentation that was used for the teleconference is currently accessible at
www.trimascorp.com.
The information in the visual presentation located on the Company's website, is
attached as Exhibit 99.2 and is incorporated by reference into this Item 12.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Dated: May 19, 2004
TRIMAS CORPORATION
By: /s/ Benson K. Woo
--------------------------------
Name: Benson K. Woo
Title: Chief Financial Officer
EXHIBIT INDEX
Exhibit 99.1 Press Release
Exhibit 99.2 Presentation Materials
Exhibit 99.1
For more information, contact:
Benson Woo
Chief Financial Officer
TriMas Corporation
248-631-5453
MEDIA RELEASE
For Immediate Release
TRIMAS CORPORATION REPORTS SALES UP 20% AND STRONG EARNINGS IN FIRST QUARTER
BLOOMFIELD HILLS, Mich. - May 13, 2004 - TriMas Corporation today announced its
financial results for the three months ended March 31, 2004. Compared to the
prior year first quarter period, sales increased 19.7%, operating profit
improved 22.1%, and net income was $2.5 million versus a $7.0 million loss.
Diluted earnings per share were $0.13 versus a loss per share of $0.35 in the
first quarter of 2003.
First Quarter Highlights
o The Company's net sales increased 19.7% from $218.0 million to $260.9
million.
o Operating profit increased $3.8 million, or 22.1%, to $20.9 million and
approximated 8.0% of net sales.
o The Company earned net income for the quarter of $2.5 million, or $0.13 per
share, compared to a net loss of $7.0 million, or $0.35 per share, a year
ago.
o The Company completed the acquisition of Theodore Bargman Company
("Bargman") in January 2004.
"We are encouraged that our momentum from late 2003 has carried forward into
2004. Improving business conditions, new products, and the execution of
performance initiatives helped to achieve a solid quarter for all of our
business segments. We are enjoying the benefits of our operating leverage as
revenue increases across the Company," said Grant Beard, President and Chief
Executive Officer.
First Quarter Financial Summary
(In millions, except per share amounts and percentages)
- ------------------------------------------ ------------------------------------------------------
For the Quarter Ended
- ------------------------------------------ ------------------- ------------------- --------------
March 31, 2004 March 30, 2003 % Change
- ------------------------------------------ ------------------- ------------------- --------------
Sales $ 260.9 $218.0 19.7%
- ------------------------------------------ ------------------- ------------------- --------------
Gross profit 64.6 55.5 16.4%
- ------------------------------------------ ------------------- ------------------- --------------
Operating profit 20.9 17.1 22.1%
- ------------------------------------------ ------------------- ------------------- --------------
Net income (loss) $ 2.5 $ (7.0) N/A
- ------------------------------------------ ------------------- ------------------- --------------
Earnings (loss) per share $ 0.13 $ (0.35) N/A
- ------------------------------------------ ------------------- ------------------- --------------
- ------------------------------------------ ------------------- ------------------- --------------
Other Data
- ------------------------------------------ ------------------- ------------------- --------------
- ------------------------------------------ ------------------- ------------------- --------------
- Operating profit $ 20.9 $ 17.1 22.1%
- ------------------------------------------ ------------------- ------------------- --------------
- Depreciation and amortization 10.2 11.1 (8.1%)
- ------------------------------------------ ------------------- ------------------- --------------
- Legacy stock award expense - 1.3 N/A
- ------------------------------------------ ------------------- ------------------- --------------
- Adjusted EBITDA $ 31.1 $ 29.5 5.5%
- ------------------------------------------ ------------------- ------------------- --------------
- ------------------------------------------ ------------------- ------------------- --------------
- Cash flows from operating activities $ 21.6 $ 47.8 (54.8%)
- ------------------------------------------ ------------------- ------------------- --------------
Adjusted EBITDA results for the First Quarter 2004 compared to First Quarter
2003 reflect incremental lease expense of $2.5 million related to financing
activities and incremental non-recurring charges of $3.8 million related to
restructuring and integration activities.
In addition, the Company experienced approximately $3.6 million in net
unrecovered steel surcharges from suppliers during the quarter, of which an
estimated $1.2 million impacted earnings. The Company has aggressively
implemented cost pass-throughs on steel surcharges and anticipates recovery of
substantially all additional surcharges forecasted for the remainder of the
year.
Segment Results
Cequent Transportation Accessories Group
Cequent's first quarter sales of $129.5 million represented an improvement of
30.9% compared to the prior year. Cequent experienced strong demand across all
of its business units reflecting the benefit of recent acquisitions and solid
organic growth due to improved consumer demand and overall economic conditions.
In particular, Cequent's Towing Products business capitalized on increased
demand through improved order fill rates and delivery performance at its Goshen,
IN manufacturing operations. This contributed to a 310 basis point improvement
in Cequent's operating margin to 11.3% as operating profit increased to $14.6
million from $8.1 million a year ago.
Rieke Packaging Systems Group
Rieke's sales of $30.4 million were approximately flat compared to year ago
levels. Operating profit decreased to $6.0 million from $7.6 million, due
primarily to costs associated with the start-up of its new Hangzhou, China
manufacturing facility, and the launch of eight new products. Rieke expects to
realize growing sales from these first quarter product launches during the
balance of the year.
Fastening Systems Group
Sales of the Fastening Systems Group increased $3.7 million to $38.7 million, an
increase of 10.6% from $35.0 million in 2003. The sales improvement was due to
increased demand for both aerospace fasteners and large diameter bolts used in
the heavy truck, construction and agricultural industries. However, the group
reported an overall operating loss for the quarter of $1.6 million, a decrease
of $2.8 million from the $1.2 million operating profit in the first quarter of
2003, due primarily to non-recurring closure costs resulting from the
consolidation of its Lakewood, OH plant into remaining facilities in Frankfort,
IN and Wood Dale, IL. The Fastening Systems Group's restructuring activities are
expected to be completed this year.
-2-
Industrial Specialties Group
Sales of the Industrial Specialties Group increased 15.8% or $8.5 million to
$62.3 million as each of the group's six businesses experienced strong demand
and higher sales levels. Notably, sales increased at Lamons Gasket due primarily
to achieving full run rate levels on a new contract with a major customer, at
Norris Cylinder due to improved economic conditions in industrial markets, and
at Compac due primarily to higher sales of asphalt-coated products. The group's
operating profit increased 25.1%, or $1.5 million to $7.7 million, due in part
to overall higher sales and increased operating efficiencies as a result of
branch consolidation activities at Lamons and productivity improvements within
Compac. Compac continues to increase its presence in the residential facings
market, and is on schedule to complete the move to its new Hackettstown, NJ
plant by the end of 2004.
-3-
Financial Position
TriMas ended the first quarter with total assets of $1,510.1 million, debt of
$734.6 million, and $56.9 million outstanding under its receivables
securitization facility. The increase in amounts outstanding under our credit
facilities from year-end 2003 is primarily due to increased working capital
requirements to support higher sales levels, particularly at Cequent during the
spring selling season, increased capital spending compared to the prior year's
quarter and the acquisition of Bargman. Net cash from operating activities was
$21.6 million compared to $47.8 million a year ago, with the decrease due
principally to the aforementioned increase in working capital requirements.
Bargman Acquisition
In January 2004, TriMas completed the acquisition of Bargman, a leading
manufacturer of lighting products based in Albion, IN, with 2003 sales of
approximately $12.8 million.
Conference Call
TriMas will broadcast its first quarter earnings conference call on Thursday,
May 13, 2004 at 4:30 p.m. EDT. President and Chief Executive Officer Grant Beard
and Chief Financial Officer Benson Woo will discuss the Company's recent
financial performance and respond to questions from the investment community.
To participate by phone, please dial: (800) 213-1351. Callers should ask to be
connected to the TriMas first quarter conference call.
If you are unable to participate during the live teleconference, a replay of the
conference call will be available beginning May 13th at 7:30 p.m. EDT through
May 20th at 7:30 p.m. EDT. To access the replay, please dial: (800) 633-8284 and
use reservation number 21195182.
-4-
A Note on Adjusted EBITDA
The Company defines Adjusted EBITDA as operating profit before depreciation,
amortization, goodwill impairment, and legacy stock award expense. Lease expense
and non-recurring charges are included in Adjusted EBITDA and include both cash
and non-cash charges related to restructuring and integration expenses.
Management uses this non-GAAP financial measure as an internal operating metric.
Management believes this measure is useful as an analytical indicator of
leverage capacity and debt servicing ability, and uses it to measure financial
performance as well as for planning purposes. However, Adjusted EBITDA should
not be considered as an alternative to net income, cash flow from operating
activities or any other measures calculated in accordance with U.S. GAAP, or as
an indicator of operating performance. The definition of Adjusted EBITDA used
here may differ from that used by other companies.
Cautionary Notice Regarding Forward-Looking Statements
This news release contains "forward-looking" statements, as that term is defined
by the federal securities laws, about our financial condition, results of
operations and business. Forward-looking statements include certain anticipated,
believed, planned, forecasted, expected, targeted and estimated results along
with TriMas' outlook concerning future results. When used in this release, the
words "estimates," "expects," "anticipates," "projects," "plans," "intends,"
"believes," "forecasts," or future or conditional verbs, such as "will,"
"should," "could," or "may," and variations of such words or similar expressions
are intended to identify forward-looking statements. All forward-looking
statements, including, without limitation, management's examination of
historical operating trends and data 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, there
can be no assurance that management's expectations, beliefs and projections will
be achieved. These forward-looking statements are subject to numerous
assumptions, risks and uncertainties and accordingly, actual results may differ
materially from those expressed or implied by the forward-looking statements. We
caution readers not to place undue reliance on the statements, which speak only
as of the date of this release. The cautionary statements set forth above should
be considered in connection with any subsequent written or oral forward-looking
statements that we or persons acting on our behalf may issue. We do not
undertake any obligation to review or confirm analysts' expectations or
estimates or to release publicly any revisions to any forward-looking statements
to reflect events or circumstances after the date of this release or to reflect
the occurrence of unanticipated events. Risks and uncertainties that could cause
actual results to vary materially from those anticipated in the forward-looking
statements included in this release include general economic conditions in the
markets in which we operate and industry-based factors such as: technological
developments that could competitively disadvantage us, increases in our raw
material, energy, and healthcare costs, our dependence on key individuals and
relationships, exposure to product liability and warranty claims, compliance
with environmental, and other regulations, and competition within our
industries. In addition, factors more specific to us could cause actual results
to vary materially from those anticipated in the forward-looking statements
included in this release such as our substantial leverage, limitations imposed
by our debt instruments, our ability to success-
-5-
fully pursue our stated growth strategies and opportunities, including our
ability to identify attractive and other strategic acquisition opportunities and
to successfully integrate acquired businesses including actions we have
identified as providing cost-saving opportunities.
-6-
[OBJECT OMITTED]
-7-
[OBJECT OMITTED]
-8-
TRIMAS CORPORATION
Company and Business Segment Financial Information
(in millions)
Three Months Ended
March 31, 2004 and March 30, 2003
------------------------------------------------------ -------------- ---- --------------
2004 2003
------------------------------------------------------ -------------- ---- --------------
Cequent Transportation Accessories
------------------------------------------------------ -------------- ---- --------------
Net sales $ 129.5 $ 98.9
------------------------------------------------------ -------------- ---- --------------
Operating income $ 14.6 $ 8.1
------------------------------------------------------ -------------- ---- --------------
Rieke Packaging Systems
------------------------------------------------------ -------------- ---- --------------
Net sales $ 30.4 $ 30.3
------------------------------------------------------ -------------- ---- --------------
Operating income $ 6.0 $ 7.6
------------------------------------------------------ -------------- ---- --------------
Fastening Systems
------------------------------------------------------ -------------- ---- --------------
Net sales $ 38.7 $ 35.0
------------------------------------------------------ -------------- ---- --------------
Operating income (loss) $ (1.6) $ 1.2
------------------------------------------------------ -------------- ---- --------------
Industrial Specialties Group
------------------------------------------------------ -------------- ---- --------------
Net sales $ 62.3 $ 53.8
------------------------------------------------------ -------------- ---- --------------
Operating income $ 7.7 $ 6.2
------------------------------------------------------ -------------- ---- --------------
Total Company
------------------------------------------------------ -------------- ---- --------------
Net sales $ 260.9 $ 218.0
------------------------------------------------------ -------------- ---- --------------
Operating income (including Corporate office) $ 20.9 $ 17.1
------------------------------------------------------ -------------- ---- --------------
Adjusted EBITDA $ 31.1 $ 29.5
------------------------------------------------------ -------------- ---- --------------
About TriMas
Headquartered in Bloomfield Hills, Mich., TriMas is a diversified growth
company of high-end, specialty niche businesses manufacturing a variety of
products for commercial, industrial and consumer markets worldwide. TriMas is
organized into four strategic business groups: Cequent Transportation
Accessories, Rieke Packaging Systems, Fastening Systems, and Industrial
Specialties. TriMas has nearly 5,000 employees at 80 different facilities in 10
countries. For more information, visit .
Exhibit 99.2
[TriMas Corporation Logo]
A Heartland Industrial Partners' Company
First Quarter 2004 Review Conference Call
May 13, 2004
[Cover Page]
Safe Harbor Statement:
This document contains "forward-looking" statements, as that term is defined by
the federal securities laws, about our financial condition, results of
operations and business. Forward-looking statements include certain anticipated,
believed, planned, forecasted, expected, targeted and estimated results along
with TriMas' outlook concerning future results. The words "estimates,"
"expects," "anticipates," "projects," "plans," "intends," "believes,"
"forecasts," or future or conditional verbs, such as "will," "should," "could,"
or "may," and variations of such words or similar expressions are intended to
identify forward-looking statements. All forward-looking statements, including,
without limitation, management's examination of historical operating trends and
data are based upon our current expectations and various assumptions. Our
expectations, beliefs and projections are expressed in good faith and we believe
-9-
there is a reasonable basis for them. However, there can be no assurance that
management's expectations, beliefs and projections will be achieved. These
forward-looking statements are subject to numerous assumptions, risks and
uncertainties and accordingly, actual results may differ materially from those
expressed or implied by the forward-looking statements. We caution readers not
to place undue reliance on the statements, which speak only as of the date of
this release. The cautionary statements set forth above should be considered in
connection with any subsequent written or oral forward-looking statements that
we or persons acting on our behalf may issue. We do not undertake any obligation
to review or confirm analysts' expectations or estimates or to release publicly
any revisions to any forward-looking statements to reflect events or
circumstances after the date of this release or to reflect the occurrence of
unanticipated events. Risks and uncertainties that could cause actual results to
vary materially from those anticipated in the forward-looking statements
included in this release include general economic conditions in the markets in
which we operate and industry-based factors such as: technological developments
that could competitively disadvantage us, increases in our raw material, energy,
and healthcare costs, our dependence on key individuals and relationships,
exposure to product liability and warranty claims, compliance with
environmental, and other regulations, and competition within our industries. In
addition, factors more specific to us could cause actual results to vary
materially from those anticipated in the forward-looking statements included in
this release such as our substantial leverage, limitations imposed by our debt
instruments, our ability to successfully pursue our stated growth strategies and
opportunities, including our ability to identify attractive and other strategic
acquisition opportunities and to successfully integrate acquired businesses
including actions we have identified as providing cost-saving opportunities.
[Page 1]
Agenda
o 2004 First Quarter Financial Highlights
o 2004 First Quarter Operating Highlights
o 2004 First Quarter Financial Performance
o TriMas Capitalization
o 2004 Key Performance Drivers
o Q&A
o Appendix
[Page 2]
2004 First Quarter Financial Highlights
o TriMas had sales of $260.9 million, representing an increase of $42.9
million or 19.7% over the prior year's period.
o First quarter net income was $2.5 million, or $0.13 per share,
representing a significant improvement over 2003 first quarter results
that reflect a net loss of $7.0 million, or a loss of $0.35 per share.
o Operating profit increased by $3.8 million or 22.1%, to $20.9 million.
o Recurring EBITDA increased $5.4 million to $38.6 million, or 16.3%
compared to prior year period.
o Adjusted EBITDA increased $1.6 million to $31.1 million, or 5.5%
compared to a year ago.
o TriMas ended the first quarter with $734.6 million of debt and
borrowings on its receivables securitization facility of $56.9
million, reflecting the Company's sales growth and investment in
working capital. The Company's bank LTM EBITDA was $153.4 million
which supports our lending ratios:
o The Company's leverage ratio was 5.16x vs. the leverage covenant of
5.50x.
o The interest coverage ratio was 2.47x vs. the interest coverage
covenant of 2.25x.
o TriMas had $6.9 million in cash and cash equivalents at quarter end.
[Page 3]
2004 First Quarter Operating Highlights
During the first quarter, TriMas realized the benefits of several significant
strategic initiatives which, when combined with overall macroeconomic
improvements, resulted in strong first quarter performance for all of our
business segments.
o TriMas Corporation Overall
o Filed an S-1 registration statement with the SEC in connection
with a possible IPO.
o Experienced approximately $3.6 million in net unrecovered steel
surcharges from suppliers during first quarter, of which $1.2
million flowed through earnings. We have aggressively implemented
cost pass- throughs on steel surcharges and anticipate recovery
of almost all additional surcharges for the remainder of the
year.
-10-
o Cequent Transportation Accessories
o Net sales for the quarter improved to $129.5 million, a 30.9%
increase from the prior year, reflecting the benefit of the
HammerBlow, Highland and Bargman acquisitions and solid organic
growth between years.
o Operating profit improved to $14.6 million, an increase of 79.5%,
while Segment EBITDA was $21.2 million, an increase of 32.7%
compared to the prior year.
o Cequent experienced solid order activity throughout the quarter
and order backlogs continue to be strong across all market
channels. The outlook remains generally positive for the summer
selling season.
o Operational and order fill performance at our Goshen, IN facility
has stabilized and has significantly improved over historical
levels.
o Cequent opened its new distribution center in South Bend, IN to
further consolidate distribution activities, eliminate excess
inventory and better serve our specialty and big-box retail
customers.
o Cequent is also finalizing integration of its distribution system
in Canada, announced closure of the Oakville, Ontario production
facility, and is nearing completion of the Wausau, WI plant
closure. [Page 4]
2004 First Quarter Operating Highlights
o Rieke Packaging Systems
o Net sales for the quarter were $30.4 million and approximately
flat compared to the prior year.
o Segment EBITDA was $10.6 million, an improvement of 6.1% compared
to the prior year.
o Operating income declined to $6.0 million from $7.6 million
primarily as a result of start-up costs at Rieke's new Hangzhou,
China, manufacturing facility, as well as new product launch
costs.
o Order activity for Rieke's core industrial closure products
strengthened throughout the quarter.
o The Hangzhou, China facility shipped its first product in
February. o Rieke began shipping eight new products in the
quarter, and we expect to enjoy sales from these and additional
new products that will be launched over the remainder of the
year.
o Fastening Systems
o Net sales for the quarter were $38.7 million, an increase of
10.6% compared to the prior year.
o Improved demand for aerospace fasteners resulted in a
21.2%increase in year-over-year first quarter sales at Monogram.
o The group also benefited from a 9.4% sales increase in our
industrial fastener products as end users in the heavy truck,
construction and agricultural industries began to experience
demand expansion.
o Segment EBITDA was $5.0 million an improvement of 20.1% compared
to the prior year.
o The group had an operating loss of $1.6 million due primarily to
closure related costs resulting from the consolidation of its the
Lakewood, OH plant into remaining facilities in Frankfort, IN and
Wood Dale, IL.
o Fastening Systems is on target to complete the closure of the
Lakewood, OH facility in early third quarter.
[Page 5]
2004 First Quarter Operating Highlights
o Industrial Specialties
o Net sales for the quarter were $62.3 million, an increase of
15.8% over the prior year first quarter.
o Sales increased at Lamons Gasket due to achieving full run rate
levels on a new contract with a major customer, at Norris
Cylinder due to improved economic conditions in end industrial
markets for its products, and at Compac due primarily to higher
sales of asphalt-coated products.
o Operating profit was $7.7 million, an increase of 25.0%, compared
to the year ago quarter, reflecting the benefits of improved
sales and higher operating leverage.
o We continue to experience strong order activity across the entire
group as a result of several new product initiatives.
o Compac is on target to complete the move to its new Hackettstown,
NJ facility by the end of 2004.
[Page 6]
-11-
2004 First Quarter Financial Performance ($ in millions)
- ----------------------- ------------------------------------------------ -----------------------------------------------
Q1 2004 versus Q1 2003 LTM Ended 3/31/04 vs. 3/30/03
- ----------------------- ------------------------------------------------ -----------------------------------------------
Net Sales Q1 2004 Q1 2003 Variance 3/31/2004 3/30/2003 Variance
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Cequent $129.5 $98.9 30.9% $458.0 $305.9 49.7%
Transportation
Accessories
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Rieke Packaging $30.4 $30.3 0.3% $119.2 $112.7 5.8%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Fastening Systems $38.7 $35.0 10.6% $144.7 $146.4 1.2%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Industrial Specialties $62.3 $53.8 15.8% $226.4 $208.1 8.8%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Total Net Sales $260.9 $218.0 19.7% $948.3 $773.1 22.7%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Adjusted EBITDA
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Cequent $21.2 $16.0 32.7% $77.0 $50.2 53.4%
Transportation
Accessories
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Rieke Packaging $10.6 $10.0 6.1% $41.2 $37.0 11.4%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Fastening Systems $5.0 $4.1 20.1% $22.6 $20.0 13.0%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Industrial Specialties $11.4 $8.9 27.8% $39.5 $34.9 13.2%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Total Segment EBITDA $48.2 $39.0 23.4% $180.3 $142.1 26.9%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
% Margin 18.5% 17.9% 0.6% 19.0% 18.4% 0.6%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Corporate Expense $(4.7) $(3.4) 36.4% $(16.3) $(11.3) 44.2%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Lease Expense $(3.9) $(1.4) N/A $(14.2) $(3.3) N/A
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Heartland Management ($1.0) $(1.0) N/A $(4.0) $(3.2) N/A
Fee
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Total Company $38.6 $33.2 16.3% $145.8 $124.3 17.3%
Recurring EBITDA
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
% Margin 14.8% 15.2% 0.4% 15.4% 16.1% 0.7%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Non-recurring charges $(7.5) $(3.7) 103.8% $(28.1) $(18.4) 52.7%
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Total Company $31.1 $29.5 5.5% $117.1 $105.9 11.1%
Adjusted EBITDA
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Memo Items:
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
Legacy Stock Award $0.0 $(1.3) $1.3 $(3.6) $(4.8) 1.2%
Expense
- ----------------------- --------------- --------------- ---------------- --------------- --------------- ---------------
(1) The Company has established Earnings Before Interest, Taxes, Depreciation
and Amortization ("EBITDA") as an indicator of our operating performance and as
a measure of our cash generating capabilities. The Company defines "Adjusted
EBITDA" as operating profit plus depreciation, amortization, impairment of
goodwill, and legacy stock award expense.
(2) Lease expense is included in Adjusted EBITDA and relates to sale leaseback
transactions and new operating leases for principal manufacturing facilities and
equipment.
(3) Non-recurring charges are included in Adjusted EBITDA and include
both cash and non-cash charges related to restructuring and integration
activities.
[Page 7]
2004 First Quarter Financial Performance
o Total company net sales increased 19.7% between first quarter periods;
adjusting for the acquisitions of Bargman, HammerBlow and Highland, we
experienced a healthy 11.1% sales growth rate.
o Cequent's sales improved 30.9%; adjusting for the acquisitions of
Bargman, HammerBlow, and Highland, net sales grew a solid 12.0%
between first quarter periods.
o Rieke's sales were flat between years, but we anticipate that order
activity of core products and new products being launched will
positively impact sales performance in the second half of the year.
-12-
o Fastening Systems net sales increased 10.6% and Industrial Specialties
net sales grew 15.8% and we are encouraged by indications of demand
expansion in industrial markets.
o Operational leverage as top line revenue recovers.
o We absorbed $3.6 million in net, unrecovered surcharges on steel
purchases in Q1 ($1.2mm which have flowed so far through the P&L)
o Aggressively implemented cost pass-throughs on steel surcharges
and anticipate recovery of substantially all further cost
surcharges for remainder of 2004.
o We had non-recurring charges of $7.5 million in the quarter related
to:
o Plant closure and restructuring activities within Fastening
Systems;
o Ramp-up of Rieke's new manufacturing facility in Hangzhou, China;
o Consolidation of Compac's operations in our new facility in
Hackettstown, NJ;
o Ramp-up of Cequent's new world-class distribution center in South
Bend, IN.
[Page 8]
TriMas Capitalization
First Quarter 2004 Update: (in millions)
TriMas had $6.9 million of cash and cash equivalents at March 31, 2004.
The Credit Agreement leverage ratio was 5.16x Bank LTM EBITDA at March 31, 2004.
- ------------------------------------------------------------------ ------------------------- -------------------------
31-Mar-04 % of Total
- ------------------------------------------------------------------ ------------------------- -------------------------
Cash and Cash Equivalents $6.9
- ------------------------------------------------------------------ ------------------------- -------------------------
Working Capital Revolver $7.0 0.6%
- ------------------------------------------------------------------ ------------------------- -------------------------
Term Loan B $291.1 25.7%
- ------------------------------------------------------------------ ------------------------- -------------------------
Other Debt $0.4 0.0%
- ------------------------------------------------------------------ ------------------------- -------------------------
Subtotal, Senior Secured Debt $298.5 26.3%
- ------------------------------------------------------------------ ------------------------- -------------------------
9.875% Senior Sub Notes due 2012 $436.1 38.6%
- ------------------------------------------------------------------ ------------------------- -------------------------
Total Debt $743.6 64.9%
- ------------------------------------------------------------------ ------------------------- -------------------------
Metaldyne Seller Common Equity $100.0 8.9%
- ------------------------------------------------------------------ ------------------------- -------------------------
Contributed Common Equity $296.6 26.2%
- ------------------------------------------------------------------ ------------------------- -------------------------
Total, Equity (1) $396.6 35.1%
- ------------------------------------------------------------------ ------------------------- -------------------------
Total Capitalization $1,131.2 100%
- ------------------------------------------------------------------ ------------------------- -------------------------
Memo: A/R Securitization $56.9
- ------------------------------------------------------------------ ------------------------- -------------------------
Total Debt + A/R Securitization $791.5
- ------------------------------------------------------------------ ------------------------- -------------------------
Key Ratios:
- ------------------------------------------------------------------ ------------------------- -------------------------
Bank LTM EBITDA $153.4
- ------------------------------------------------------------------ ------------------------- -------------------------
Coverage Ratio 2.47x
- ------------------------------------------------------------------ ------------------------- -------------------------
Leverage Ratio 5.16x
- ------------------------------------------------------------------ ------------------------- -------------------------
(1) Contributed equity from Metaldyne and Heartland, including $35 million from
Heartland for recent acquisitions. [Page 9]
2004 Key Performance Drivers
o Focus on earnings expansion through completion of integration
activities, organic growth initiatives, and debt reduction.
o Increase operational leverage via incremental productivity
improvements
o Manage steel pricing and supply issues to mitigate impact to
operating earnings
o Evolving focus within TriMas to revenue growth through new product
launches and market development vs. integration and restructuring
initiatives.
o Finalize the closure of Fastening Systems' Lakewood, OH facility
and the legacy HammerBlow Wausau, WI facility and start-up of
Compac's new Hackettstown, NJ facility.
o Seek to broaden "core" businesses via aggressive product and market
development initiatives combined with selective acquisitions.
o Continue to expand capabilities internationally.
o Capitalize on benefits of key strategic initiatives and overall
strengthening of the US economy to achieve additional momentum across
all four of TriMas' business segments.
[Page 10]
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Q&A
[Page 11]
Appendix
[Page 12]
Cash Flow Highlights (in millions) Periods Ended March 31, 2004 and March 30,
2003
- ----------------------------------------------------------------------------------- --------------- ------------------
2004 2003
- ----------------------------------------------------------------------------------- --------------- ------------------
Cash provided by operations $21.6 $47.8
- ----------------------------------------------------------------------------------- --------------- ------------------
Capital Expenditures ($14.8) ($4.7)
- ----------------------------------------------------------------------------------- --------------- ------------------
Proceeds from sales of fixed assets $0.2 $42.1
- ----------------------------------------------------------------------------------- --------------- ------------------
Acquisition of businesses, net of cash acquired ($5.5) ($200.7)
- ----------------------------------------------------------------------------------- --------------- ------------------
Cash used for investing activities ($20.1) ($163.3)
- ----------------------------------------------------------------------------------- --------------- ------------------
Proceeds from senior credit facility, net $6.3 $15.0
- ----------------------------------------------------------------------------------- --------------- ------------------
Payments on notes payable and other ($7.7) ($0.3)
- ----------------------------------------------------------------------------------- --------------- ------------------
Proceeds from sales of common stock, net $0.0 $30.0
- ----------------------------------------------------------------------------------- --------------- ------------------
Metaldyne financing items, net $0.0 $1.0
- ----------------------------------------------------------------------------------- --------------- ------------------
Cash provided by financing activities ($1.4) $45.7
- ----------------------------------------------------------------------------------- --------------- ------------------
Change in Cash and Debt including AR Securitization $0.1 ($69.8)
- ----------------------------------------------------------------------------------- --------------- ------------------
[Page 13]
2004 EBITDA Bridge (in millions)
- ------------------------------------------------------------ ---------------------------------------------------------
Three Months Ended March 31, 2004 Three Months Ended March 30, 2003
- ------------------------------------------------------------ ---------------------------------------------------------
Adjusted EBITDA Bridge Adjusted EBITDA Bridge
- ------------------------------------------------------------ ---------------------------------------------------------
Operating Profit (1) $20.9 Operating Profit (1) $17.1
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Depreciation & Amortization 10.2 Depreciation & Amortization 11.1
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Legacy Stock Expense -- Legacy Stock Expense 1.3
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Total Adjusted EBITDA 31.1 Total Adjusted EBITDA 29.5
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Leases 3.9 Leases 1.4
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Corporate Expenses 4.7 Corporate Expenses 3.4
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Heartland Mgt. Fees 1.0 Heartland Mgt. Fees 1.0
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Non-Recurring Expenses 7.5 Non-Recurring Expenses 3.7
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Segment EBITDA $48.2 Segment EBITDA $39.0
- ------------------------------------------------------------ ---------------------------------------------------------
Operating Profit by Segment Operating Profit by Segment
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Cequent $14.6 Cequent $8.1
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Rieke 6.0 Rieke 7.6
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Fastening Systems (1.6) Fastening Systems 1.2
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Industrial Specialties 7.7 Industrial Specialties 6.2
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Corporate Expense & Mgt Fees (5.8) Corporate Expense & Mgt Fees (4.7)
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Legacy Stock -- Legacy Stock (1.3)
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
Total $20.9 Total $17.1
- ------------------------------------------ ----------------- ----------------------------------------- ---------------
[Page 14]
Condensed Balance Sheet ($ in millions)
- ---------------------------------------------------------------------- ------------------------ ------------------------
Mar. 31, 2004 Dec. 31, 2003
- ---------------------------------------------------------------------- ------------------------ ------------------------
- ---------------------------------------------------------------------- ------------------------ ------------------------
Assets
- ---------------------------------------------------------------------- ------------------------ ------------------------
Current Assets
- ---------------------------------------------------------------------- ------------------------ ------------------------
-14-
- ---------------------------------------------------------------------- ------------------------ ------------------------
Cash & Cash Equivalents $6.9 $6.8
- ---------------------------------------------------------------------- ------------------------ ------------------------
Receivables 108.3 119.0
- ---------------------------------------------------------------------- ------------------------ ------------------------
Inventories 136.6 124.1
- ---------------------------------------------------------------------- ------------------------ ------------------------
Deferred Income Taxes 11.0 10.9
- ---------------------------------------------------------------------- ------------------------ ------------------------
Prepaid Expenses and other Current Assets 11.2 8.4
- ---------------------------------------------------------------------- ------------------------ ------------------------
Total Current Assets $274.0 $269.2
- ---------------------------------------------------------------------- ------------------------ ------------------------
Property & Equipment, net 196.9 187.4
- ---------------------------------------------------------------------- ------------------------ ------------------------
Goodwill 658.0 658.9
- ---------------------------------------------------------------------- ------------------------ ------------------------
Other Intangibles 320.7 322.7
- ---------------------------------------------------------------------- ------------------------ ------------------------
Other Assets 60.5 61.8
- ---------------------------------------------------------------------- ------------------------ ------------------------
Total Assets 1,510.1 1,500.0
- ---------------------------------------------------------------------- ------------------------ ------------------------
Liabilities and Shareholder's Equity
- ---------------------------------------------------------------------- ------------------------ ------------------------
Current Liabilities
- ---------------------------------------------------------------------- ------------------------ ------------------------
Current Maturities, Long-Term Debt $3.3 $10.9
- ---------------------------------------------------------------------- ------------------------ ------------------------
Accounts Payable 104.6 $94.1
- ---------------------------------------------------------------------- ------------------------ ------------------------
Accrued Liabilities 75.3 $75.1
- ---------------------------------------------------------------------- ------------------------ ------------------------
Due to Metaldyne 3.6 $4.4
- ---------------------------------------------------------------------- ------------------------ ------------------------
Total Current Liabilities $186.8 $184.5
- ---------------------------------------------------------------------- ------------------------ ------------------------
Long-Term Debt $731.3 $725.1
- ---------------------------------------------------------------------- ------------------------ ------------------------
Deferred Income Taxes 150.6 149.0
- ---------------------------------------------------------------------- ------------------------ ------------------------
Other Long-Term Liabilities 36.6 37.8
- ---------------------------------------------------------------------- ------------------------ ------------------------
Due to Metaldyne 6.5 6.9
- ---------------------------------------------------------------------- ------------------------ ------------------------
Total Liabilities $1,111.8 $1,103.3
- ---------------------------------------------------------------------- ------------------------ ------------------------
Total Shareholders' Equity $398.3 $396.7
- ---------------------------------------------------------------------- ------------------------ ------------------------
Total Liabilities and Shareholders' Equity $1,510.1 $1,500.0
- ---------------------------------------------------------------------- ------------------------ ------------------------
[Page 15]
Condensed Statement of Operations (in millions, except per share amounts)
For the Three Months Ended
- ---------------------------------------------------------------------------------- ---------------- ------------------
March 31, 2004 March 30, 2003
- ---------------------------------------------------------------------------------- ---------------- ------------------
Net Sales $260.9 $218.0
- ---------------------------------------------------------------------------------- ---------------- ------------------
Cost of sales (196.3) (162.5)
- ---------------------------------------------------------------------------------- ---------------- ------------------
Gross profit 64.6 55.5
- ---------------------------------------------------------------------------------- ---------------- ------------------
Selling, general and administrative expenses (43.7) (38.4)
- ---------------------------------------------------------------------------------- ---------------- ------------------
Operating profit 20.9 17.1
- ---------------------------------------------------------------------------------- ---------------- ------------------
Other expense, net (16.9) (28.7)
- ---------------------------------------------------------------------------------- ---------------- ------------------
Income (loss) before income taxes 4.0 (11.6)
- ---------------------------------------------------------------------------------- ---------------- ------------------
Income taxes (1.5) 4.6
- ---------------------------------------------------------------------------------- ---------------- ------------------
Net income (loss) $2.5 $(7.0)
- ---------------------------------------------------------------------------------- ---------------- ------------------
Basic earnings (loss) per share $0.13 $(0.35)
- ---------------------------------------------------------------------------------- ---------------- ------------------
Diluted earnings (loss) per share $0.13 $(0.35)
- ---------------------------------------------------------------------------------- ---------------- ------------------
Weighted average common shares - basic 20.0 20.1
- ---------------------------------------------------------------------------------- ---------------- ------------------
Weighted average common shares - diluted 20.3 20.1
- ---------------------------------------------------------------------------------- ---------------- ------------------
[Page 16]
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