Cooper-Standard Holdings Inc. (NYSE: CPS) (“Cooper Standard” or “the “Company”), the parent company of Cooper Standard Automotive, a leading global supplier of automotive sealing, fuel and brake, fluid transfer and anti-vibration systems, today announced financial results for the third quarter and nine months ended Sept. 30, 2013. The Company has updated its previous financial guidance for the full year.
“During the quarter we delivered solid year-over-year revenue growth and EBITDA margin,” said Jeffrey Edwards, chairman and CEO, Cooper Standard. “At the same time, we are investing in new manufacturing footprint and expanding our capabilities to meet the demands of increasing global light vehicle production, particularly in North America and emerging markets. We are confident that our global expansion and continued innovation on behalf of our customers will enable Cooper Standard to drive long-term profitable growth.”
Third Quarter and Nine Months Ended Sept. 30, 2013 Results
The Company reported revenue of $764.1 million for the third quarter of 2013, compared to $684.0 million for the third quarter of 2012. The 11.7 percent increase in sales was driven by strong volume increase in North America, market share gains in Europe and notable sales increases in all other regions of the world. In addition, the Company’s acquisition of Jyco Sealing Technologies provided $11.9 million of incremental sales.
Gross profit for the quarter was $115.0 million or 15.1 percent of sales, compared to $103.1 million or 15.1 percent of sales for the third quarter of 2012. The increase in gross profit was driven primarily by increased volumes in all regions and favorable impact of lean savings, partially offset by customer price concessions, higher staffing costs and other operating expenses.
The Company reported net income of $20.3 million or $1.08 per share on a fully diluted basis in the third quarter of 2013, compared to $10.4 million or $0.44 per share in the third quarter of 2012. The improvement in earnings per share was primarily the result of lower restructuring costs and lower share count driven by the second quarter 2013 share repurchase. Net income for the nine months ended Sept. 30, 2013 was $66.3 million, compared to $110.3 million in the same prior year period, which included a one-time $48.3 million tax valuation benefit in the United States.
Adjusted EBITDA for the third quarter was $69.5 million or 9.1 percent of sales compared to $69.8 million or 10.2 percent of sales in the same quarter last year. For the nine month period ended Sept.30, 2013, adjusted EBITDA was $228.7 million, compared to $ 227.1 million in the prior year period.
Highlights from the Third Quarter
- Listed on the New York Stock Exchange under new ticker symbol “CPS”
- Inaugurated Bawal, India plant and broke ground on new facility in Sanand, India
- Received Tata Motors Special Citation for Extraordinary Contributions
Net Income to Adjusted EBITDA Reconciliation
The following table provides a reconciliation of EBITDA and adjusted EBITDA to net income, which is the most comparable U.S. GAAP financial measure:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||
| 2012 | 2013 | 2012 | 2013 | ||||||
| (dollar amounts in millions) | |||||||||
| Net income attributable to Cooper-Standard Holdings Inc. | $ 11.6 | $ 20.6 | $ 112.7 | $ 68.7 | |||||
| Income tax expense (benefit) | 5.4 | 4.5 | (32.8) | 24.6 | |||||
| Interest expense, net of interest income | 11.3 | 15.2 | 33.3 | 40.0 | |||||
| Depreciation and amortization | 29.1 | 25.2 | 91.2 | 83.2 | |||||
| EBITDA | $ 57.4 | $ 65.5 | $ 204.4 | $ 216.5 | |||||
| Restructuring (1) | 10.2 | 1.9 | 15.8 | 7.7 | |||||
| Noncontrolling interest restructuring (2) | (0.2) | – | (0.5) | (0.8) | |||||
| Inventory write-up(3) | – | 0.3 | – | 0.3 | |||||
| Acquisition costs(4) | – | 0.7 | – | 0.7 | |||||
| Stock-based compensation (5) | 2.4 | 1.1 | 7.4 | 4.3 | |||||
| Adjusted EBITDA | $ 69.8 | $ 69.5 | $ 227.1 | $ 228.7 | |||||
| (1) | Includes non-cash restructuring. | ||||||||
| (2) | Proportionate share of restructuring costs related to FMEA joint venture. | ||||||||
| (3) | Write-up of inventory to fair value for the Jyco acquisition. | ||||||||
| (4) | Costs incurred in relation to the Jyco acquisition. | ||||||||
| (5) | Non-cash stock amortization expense and non-cash stock option expense for grants issued at emergence from bankruptcy. | ||||||||
