TMCnet News
Materion Corp. Releases Second Quarter Financial Results [Health & Beauty Close - Up](Health & Beauty Close - Up Via Acquire Media NewsEdge) Materion Corp. reported second quarter financial results. According to its release on July 24, the Company noted that the following results: -Second quarter 2014 earnings were $0.47 per share, compared to $0.20 per share earned in the second quarter of the prior year. -Adjusted to exclude the benefit of the previously announced insurance settlement, second quarter earnings were $0.36 per share, up 80 percent compared to the same quarter of the prior year. -Sequentially, second quarter adjusted earnings were 24 percent ahead of first quarter of 2014 adjusted earnings of $0.29 per share. -The facility closures and product line rationalizations completed in 2013 are delivering the expected margin benefits. -Net sales for the second quarter were $288.0 million, 6 percent below prior-year's second quarter. Value-added sales, a non-GAAP measure as defined in Attachment 4, for the second quarter were $159.6 million, up 5 percent compared to the same quarter of the prior year and up 10 percent sequentially from the first quarter of the current year. -Adjusted operating profit margin, as a percent of value-added sales, expanded by 240 basis points to 6.7 percent from prior-year second quarter levels. -For the six months to date, adjusted earnings were $0.64 per share, 23 percent ahead of the same period of last year. -Earnings were below the Company's internal expectations due primarily to weaker demand from customers in the defense and automotive electronics markets. -Due primarily to the weaker demand from customers in the defense and automotive electronics markets, the Company is reducing its guidance for the year by approximately 12 percent to the range of $1.55 to $1.70 per share adjusted, an increase of 40 percent to 55 percent compared to $1.10 per share in the prior year. -Second half adjusted earnings are now expected to be in the range of $0.90 to $1.05 per share, up 40 percent to 60 percent from first half levels and up approximately 70 percent from prior-year second half levels. SECOND QUARTER 2014 RESULTS Sales for the second quarter were $288.0 million, compared to sales of $306.1 million for the second quarter of 2013. Value-added sales were $159.6 million, up $7.1 million, or 5 percent, compared to value-added sales of $152.5 million for the second quarter of 2013 and up sequentially 10 percent from the first quarter of 2014. The growth in value-added sales in the second quarter compared to the same period of last year was due primarily to stronger demand from customers in the consumer electronics and medical markets, partially offset by lower demand from customers in the automotive electronics and defense markets. Net income for the second quarter of 2014 was $10.0 million, or $0.47 per share. This compares to net income of $4.2 million, or $0.20 per share for the second quarter of the prior year. Excluding the net benefit of the aforementioned insurance claim settlement, second quarter adjusted earnings were $0.36 per share. Second quarter adjusted earnings were also up sequentially 24 percent from the first quarter adjusted earnings of $0.29 per share. For the first six months of 2014, sales were $546.9 million compared to sales of $605.3 million for the same period of last year. Value-added sales for the first six months of 2014 were $304.5 million compared to $303.8 million for the same period of last year. In the first six months, strong demand from customers in consumer electronics was offset by the weakness in the automotive electronics and defense industries. Year-to-date 2014 net income was $17.3 million compared to $10.9 million for the first six months of 2013. Year-to-date adjusted net income was $13.5 million, or $0.64 per share, an increase of 23 percent over the comparable period of the prior year. OUTLOOK Both value-added sales and margins continued to improve when compared to the second quarter of the prior year as well as sequentially compared to the first quarter. The facility closing and product line rationalization initiatives implemented during 2013 are complete and are providing the expected significant margin and profit improvement leverage in the Advanced Materials Technologies segment. The unfavorable product mix noted in the first half, which was driven by the weaker conditions in defense and automotive, should improve in the second half of the year. The Company continues to expect significant increases in value- added sales, margins and earnings in the second half when compared to both the prior-year's second half and the current-year's first half. Nonetheless, the Company is revising its previously announced expected adjusted earnings range for the year by approximately 12 percent to $1.55 to $1.70 per share from $1.75 to $1.95 per share. The revision is due to the two market specific issues that drove the lower than expected first half results as well as to reflect the lowered macroeconomic forecast. This range, which excludes the $0.17 EPS benefit of the previously reported first quarter asset sale and second quarter insurance settlement, represents an improvement of 40 percent to 55 percent over the prior-year's adjusted earnings of $1.10 per share and an improvement of 40 percent to 60 percent from first half levels. CHAIRMAN'S COMMENTS Richard J. Hipple, Chairman, President and CEO, stated, "We are seeing a significant improvement in the Company's earnings in 2014 over 2013 levels. The benefits from our new product initiatives and the actions that we have undertaken during 2013 are delivering the expected margin improvement. However, our value-added sales growth rate is below what we anticipated coming into 2014 due to weaker demand from the automotive electronics supply chain and from defense program push outs. We continue to expect stronger second half financial performance and a significant improvement in earnings in 2014 over 2013." More information: www.materion.com ((Comments on this story may be sent to [email protected])) (c) 2014 ProQuest Information and Learning Company; All Rights Reserved. |