NORTHVILLE, Mich. — Hayes Lemmerz International has reported substantially higher sales, adjusted EBITDA, core operating earnings and liquidity for the first fiscal quarter ended April 30.
"Hayes Lemmerz continues to show steady year-over-year improvement in operational results," said Curtis Clawson, president, CEO and chairman of the board. "We made progress in the restructuring of our North American operations, and our results reflect the fruits of that long and challenging process."
The company recently announced plans to close its aluminum wheel facility in Gainesville, Ga., by year end, due to global overcapacity in the light vehicle aluminum wheel market and increasing aluminum wheel imports into North America from low-cost countries. A portion of the annual production of the Gainesville facility will be transferred to the company’s facility in Chihuahua, Mexico. The restructuring transaction will reduce costs and improve cash flow, the company said.
For the first fiscal quarter, Hayes Lemmerz reported sales of $573.8 million, up 15 percent from $498.6 million in the year earlier quarter. Adjusted EBITDA improved 9 percent to $54.6 million from $50.1 million a year earlier. Core operating earnings (excluding discontinued operations and restructuring charges) improved to $25.2 million from $21.1 million a year earlier. The company’s net loss for the quarter improved slightly to $12.8 million, compared with a loss of $15.3 million in the prior year quarter.
Free cash flow for the first quarter, which is traditionally weak because of seasonality, was negative $55.3 million, compared with negative $2.5 million a year earlier.
"Although cash flow for the quarter was negative, our goal is to achieve positive cash flow for the full year, excluding the cash costs associated with restructuring activities," Clawson said.
Liquidity improved to $249 million from $135 million at the end of the year earlier period, reflecting the success of our rights offering and refinancing during the second quarter of 2007. The $114 million improvement came primarily from increased cash ($43 million) and increased availability under the company’s revolving credit facility ($55 million).
The company also said it expects sales for the 2008 full fiscal year will range between $2.1 billion and $2.3 billion, Adjusted EBITDA will be between $205 million and $220 million, and capital expenditures will range between $95 million and $105 million. The company continues to invest in profitable production facilities in leading-cost, high growth areas, including India, Brazil, Thailand and Turkey.
"We are on track to achieve our primary short-term goals for 2008," said Clawson. "We are executing our operating plan by improving core wheel financial results, and continued diversification of our business," he said.
He noted that Hayes Lemmerz’ wheels are now on more than 200 platforms worldwide, and that no single platform accounts for more than 4 percent of sales.
"Our diverse customer portfolio and geographic mix helps protect us from problems experienced by any single platform or manufacturer and helps to soften the impact of lower volumes in the North American automotive market," Clawson said.
For more information about Hayes-Lemmerz, go to: http://www.hayes-lemmerz.com.
