CRANFORD, NJ--(Marketwire - March 11, 2010) - Metalico, Inc. (NYSE Amex: MEA) today reported
its results for the year and quarter ended December 31, 2009.
2009 FINANCIAL HIGHLIGHTS
-- 2009 revenues of $291.7 million.
-- Operating income of $ 13.7 million.
-- EBITDA of $28.6 million.
-- Net loss of $3.4 million.
-- Fully diluted loss per share of $0.08.
Net loss for the year ended December 31, 2009 was $3.4 million or $0.08 per
share on a diluted basis on sales of $291.7 million. These results compare
to a net loss of $43.7 million or $1.25 per share on a diluted basis on
sales of $818.2 million for the year ended December 31, 2008.
Sales decreased by $526.5 million or 64% from the Company's 2008 results.
But operating income for 2009 rose to $13.7 million as compared to an
operating loss of $40.0 million for the prior year.
The Company's scrap segment generated operating income of $12.9 million for
2009 and the lead fabrication segment had operating income of $2.7 million.
In 2008, the scrap segment reported an operating loss of $24.6 million and
the lead fabrication segment showed an operating loss of $12.2 million.
Corporate and other eliminations were responsible for the rest of the
Company's 2008 operating losses.
Fourth Quarter Results Summary
Fourth Quarter financial results include the following, compared to the
prior year's Fourth Quarter:
-- Sales increased by 31% to $84.6 million.
-- Operating income was $3.0 million, compared to an operating loss of
$89.9 million.
-- Net loss was $6.0 million compared to a net loss of $67.5 million.
-- EBITDA was $6.3 million, as opposed to a negative $26.2 million.
-- 2009 loss per share was $0.13, compared to 2008 loss of $1.86 per share.
The combined effect of the following items turned the $3.0 million of
operating income into a $6.0 million net loss for the quarter. In the
period, Metalico wrote off the $2.8 million carrying value of its
investment in Beacon Energy Holdings, Inc. due to the expiration of federal
renewable energy tax credits, low product demand, rising feedstock costs
and diminished working capital balances at year end. The Company incurred
$3.0 million of interest expense and $2.2 million of non-recurring charges
related to legal settlements.
Further complicating the comparisons, certain charges described above that
produced the net loss for the Fourth Quarter are not tax deductible,
thereby resulting in federal and state income tax expense of $1.7 million,
or $0.04 per diluted share.
"Fourth Quarter operating income was negatively impacted by buying prices
rising more rapidly than selling prices and by the mix and quantity of
metals sold," said Carlos E. Agüero, Metalico's President and Chief
Executive Officer. "The Company generated higher than anticipated PGM
sales in the fourth quarter which normally carry a lower gross margin than
ferrous scrap sales. Ferrous volumes and price were negatively affected by
year-end seasonal factors."
"However, with plenty of inventory on hand at the beginning of 2010, we are
well poised to benefit from robust demand from domestic consumers and
sharply higher ferrous and non-ferrous commodity prices," Agüero added.
Debt and Shareholders' Equity
Metalico's outstanding debt decreased to $116.8 million as of December 31,
2009 from $184.7 million at December, 31, 2008, a difference of $67.9
million. Shareholders' equity increased 33% or $37.3 million to $150.3
million as of December 31, 2009, from $113.0 million as of December 31,
2008. As recently announced, Metalico closed on a new three-year $65
million senior secured credit facility led by JPMorgan Chase Bank, which
will produce annualized interest savings of approximately $2.9 million,
which will be partially offset in the first quarter of 2010 by a one-time
non-cash capitalized cost write-off of $2.2 million.
As of December 31, 2009, Metalico had 46,425,224 common shares issued and
outstanding. The Company has no outstanding preferred shares.
OUTLOOK AND UPDATE
The Company said it believes its results for 2010 may be influenced by the
following factors:
-- In the First Quarter of 2010, all grades of ferrous metals are
experiencing considerable upward pricing trends and surging demand for
scrap from steel mills in domestic markets. We believe these positive
trends will carry into the second quarter. However, demand from
export markets for ferrous scrap remains weak relative to recent norms,
but is expected to strengthen. The Company anticipates that its first
quarter ferrous scrap shipments will double over 2009 fourth quarter
shipments.
-- Demand for non-ferrous metals in the First Quarter is robust. Many
items appear to be in tight supply for recyclers, compared to recent
norms. Demand for Aluminum Deox has been steadily improving along with
steel industry capacity utilization.
-- Non-ferrous prices increased substantially through 2009 and remain
strong so far in 2010. The Company believes that base metal prices
will continue at or near current levels as the global economy gradually
recovers and a supply shortage manifests itself.
-- Intake of ferrous and non-ferrous scrap continues well below historic
levels and is expected to remain so for the foreseeable months,
potentially putting further upward pressure on buying prices.
-- Average prices for Platinum Group Metals have increased dramatically
from their lows in the second half of 2008 and remain in a narrow
trading range, although still well below historic peaks. Platinum
prices had severely impacted unit volumes industry-wide as suppliers
held back saleable metals in hopes of stronger precious metal pricing
throughout 2009. The net reduction of cars scrapped during 2009
contributed to a significant reduction in converter units available for
recycling. However, Metalico expects that units purchased and PGM
selling prices will continue to show improvement during 2010, in part
driven by rising car sales and in part by increasing the Company's share
of the converter recycling market.
-- Fabricated product sales should benefit in 2010 from an improving
economy and customary pickup in the spring/summer repair and
construction season.
Metalico, Inc. is a holding company with operations in two principal
business segments: ferrous and non-ferrous scrap metal recycling, and
fabrication of lead-based products. The Company operates twenty-four
recycling facilities in New York, Pennsylvania, Ohio, West Virginia, New
Jersey, Texas, and Mississippi and four lead fabrication plants in Alabama,
Illinois, and California. Metalico's common stock is traded on NYSE Amex
(formerly the American Stock Exchange) under the symbol MEA.
Metalico operates in a highly cyclical and volatile commodity metals
universe made more difficult by uncertain economic conditions. The
Company's strategy involves diversification among various commodity metal
groups, a focus on capacity utilization, internal growth and acquisitions,
while taking a long-term view to achieve growth and above-average financial
results.
When the Company uses the term "EBITDA," the Company is referring to
earnings before interest, stock-based compensation, income taxes,
depreciation and amortization, impairment charges, other expense, equity in
loss of unconsolidated investee, gain on acquisition, gain on debt
extinguishment, financial instruments fair value adjustment and
discontinued operations. EBITDA is considered non-GAAP financial
information and a reconciliation of net income to EBITDA is included in the
attached financial tables.
Forward-looking Statements
This news release, and in particular its "Outlook and Update" section,
contains "forward-looking statements" made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995, such as
Metalico's expectations with respect to its results of operations for the
first quarter of 2010, commodity pricing, volumes, and trends. These
statements may contain terms like "expect," "anticipate," "believe,"
"appear," "estimate" and other words that convey a similar meaning, or are
statements that do not relate strictly to historical or current facts.
Forward-looking statements include statements with respect to Metalico's
beliefs, plans, objectives, goals, expectations, anticipations,
assumptions, estimates, intentions, and future performance, and involve
known and unknown risks, uncertainties and other factors, which may be
beyond Metalico's control, and which may cause Metalico's actual results,
performance or achievements to be materially different from future results,
performance or achievements expressed or implied by such forward-looking
statements. Factors that could cause such material difference are
discussed in more detail in the Company's most recent Annual Report on Form
10-K and other filings with the Securities and Exchange Commission. All
statements other than statements of historical fact are statements that
could be forward-looking statements. Metalico assumes no obligation to
update the information contained in this news release.
METALICO, INC.
SELECTED HISTORICAL FINANCIAL DATA
(UNAUDITED)
($ thousands, except per share data)
Three Three
Months Months
Ended Ended Year Ended Year Ended
Selected Income December 31, December 31, December 31, December 31,
Statement Data: ----------- ----------- ----------- -----------
2009 2008 2009 2008
----------- ----------- ----------- -----------
Revenue $ 84,621 $ 64,542 $ 291,733 $ 818,195
----------- ----------- ----------- -----------
Costs and expenses:
Operating expenses 72,312 83,762 239,647 756,099
Selling, general &
administrative
expenses 6,708 7,596 25,994 30,146
Depreciation &
amortization 3,472 4,038 13,240 12,864
Impairment charges - 59,043 - 59,043
Gain on acquisition (866) - (866) -
----------- ----------- ----------- -----------
81,626 154,439 278,015 858,152
----------- ----------- ----------- -----------
Operating income (loss) 2,995 (89,897) 13,718 (39,957)
----------- ----------- ----------- -----------
Interest expense (2,999) (4,914) (15,857) (17,355)
Equity in loss of
unconsolidated
subsidiaries (2,809) (3,334) (3,839) (3,419)
Financial instrument
fair value adjustment (614) 1,458 (2,035) 1,943
Gain on debt
extinguishment - - 8,072 -
Other (expense) income (2,152) 208 (1,963) 410
----------- ----------- ----------- -----------
(8,574) (6,582) (15,622) (18,421)
----------- ----------- ----------- -----------
Loss from continuing
operations before
income taxes and
minority interest (5,579) (96,479) (1,904) (58,378)
Provision (benefit) for
income taxes 475 (29,371) 1,736 (15,535)
----------- ----------- ----------- -----------
Loss from continuing
operations before
minority interest (6,054) (67,108) (3,640) (42,843)
Minority interest in
loss of consolidated
subsidiaries - 1 - 413
----------- ----------- ----------- -----------
Loss from continuing
operations (6,054) (67,107) (3,640) (42,430)
Discontinued operations:
Gain (loss) from
discontinued
operations 18 (397) 195 (1,230)
----------- ----------- ----------- -----------
Net loss $ (6,036) $ (67,504) $ (3,445) $ (43,660)
=========== =========== =========== ===========
Diluted loss per common
share:
Loss from continuing
operations $ (0.13) $ (1.85) $ (0.08) $ (1.21)
Discontinued
operations (net) - (0.01) - (0.04)
----------- ----------- ----------- -----------
Net loss $ (0.13) $ (1.86) $ (0.08) $ (1.25)
=========== =========== =========== ===========
Diluted weighted
average common shares
outstanding: 46,409,899 36,281,432 41,200,895 35,136,316
=========== =========== =========== ===========
METALICO, INC.
SELECTED HISTORICAL FINANCIAL DATA (CONTINUED)
(UNAUDITED)
($ thousands)
December 31, December 31,
2009 2008
Assets:
Current Assets $ 99,435 $ 133,359
Property Plant & Equipment, net 75,253 80,083
Intangible and Other Assets 118,728 126,851
------------ ------------
Total Assets $ 293,416 $ 340,293
============ ============
Liabilities & Stockholders' Equity:
Current Liabilities $ 22,836 $ 66,551
Debt & Other Long Term Liabilities 120,323 156,770
Total Liabilities 143,159 223,321
Redeemable Common Stock - 4,000
Stockholders' Equity 150,257 112,972
Total Liabilities & Stockholders' Equity $ 293,416 $ 340,293
============ ============
Non-GAAP Financial Information
Reconciliation of Non-GAAP EBITDA and Net Income
When the Company uses the term "EBITDA," the Company is referring to
earnings before interest, stock-based compensation, income taxes,
depreciation and amortization, impairment charges, other expense, equity in
loss of unconsolidated investee, gain on acquisition, gain on debt
extinguishment, financial instruments fair value adjustment and
discontinued operations. The Company presents EBITDA because it considers
it an important supplemental measure of the Company's performance and
believes it is frequently used by securities analysts, investors and other
interested parties in the evaluation of companies in Metalico's industry.
The Company also uses EBITDA to determine its compliance with some of the
covenants under its credit facility. EBITDA is not a recognized term under
generally accepted accounting principles in the United States ("GAAP"), and
has limitations as an analytical tool. You should not consider it in
isolation or as a substitute for net income, operating income, cash flows
from operating, investing or financing activities or any other measure
calculated in accordance with GAAP. Other companies in the Company's
industry may calculate EBITDA differently from how the Company does,
limiting its usefulness as a comparative measure. EBITDA should not be
considered as a measure of discretionary cash available to the Company to
invest in the growth of its business. The following table reconciles
EBITDA to net income:
Three Three
Months Months
Ended Ended Year Ended Year Ended
December 31, December 31, December 31, December 31,
2009 2008 2009 2008
----------- ----------- ----------- -----------
(UNAUDITED)
($ thousands)
EBITDA $ 6,268 $ (26,198) $ 28,581 $ 34,357
Less:
Interest expense 2,999 4,914 15,857 17,355
Stock based
compensation 667 617 2,489 1,994
Provision
(benefit)for
federal and state
income taxes 475 (29,371) 1,736 (15,535)
Other expense
(income) 2,152 (208) 1,963 (410)
Equity in loss of
unconsolidated investee 2,809 3,334 3,839 3,419
Impairment charges - 59,043 - 59,043
Gain on acquisition (866) - (866) -
Gain on debt
extinguishment - - (8,072) -
Depreciation and
amortization 3,472 4,038 13,240 12,864
Financial instruments
fair value adjustment 614 (1,458) 2,035 (1,943)
Discontinued
operations, net (18) 397 (195) 1,230
----------- ----------- ----------- -----------
Net loss $ (6,036) $ (67,504) $ (3,445) $ (43,660)
=========== =========== =========== ===========