Lydall Announces Financial Results for the Fourth Quarter and Year Ended December 31, 2019

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MANCHESTER, Conn., Feb. 25, 2020 (GLOBE NEWSWIRE) -- LYDALL, INC. LDL today announced financial results for the fourth quarter and year ended December 31, 2019.

HIGHLIGHTS - Q4 2019 vs. Q4 2018

GAAP Financials

  • Net sales of $193.3 million, down 7.9%
  • Gross margin of 14.5%, down 540 basis points
  • Operating loss of ($68.5) million compared to operating income of $13.2 million
         – Goodwill and other long-lived asset impairment charges of $64.2 million, or ($3.71) per share
         – CEO transition and employee severance expenses of $4.2 million, or ($0.19) per share
  • Loss per share of ($4.07), compared to earnings per share of $0.42
  • Cash generated from operations of $23.9 million, compared to $30.2 million

Non-GAAP Financial Measures*

  • Organic sales decline of (8.3%)
  • Adjusted gross margin of 15.1%, down 520 basis points
  • Adjusted operating margin down 680 basis points
  • Adjusted loss of ($0.17) per share, compared to adjusted earnings of $0.52 per share
  • Adjusted EBITDA of $12.4 million, compared to $25.4 million

    *Reconciliations of the Non-GAAP financial measures to Lydall's GAAP financial results are included at the end of this release.  See also "Use of Non-GAAP Financial Measures" below.

Randall B. Gonzales, Executive Vice President and Chief Financial Officer, stated, "Fourth quarter results were disappointing, and included non-cash impairment charges of $64.2 million principally due to the under-performance of the Interface business in our Performance Materials segment.

"Organic sales declined 8.3% on further weakening of demand for fiber based gasket solutions in the Interface business, lower demand for industrial filtration products in China and Europe, and lower domestic automotive volumes attributable to the General Motors strike.

"Adjusted EBITDA was negatively impacted by manufacturing inefficiencies in the Thermal Acoustical Solutions segment and unfavorable mix and lower cost absorption in the Performance Materials segment.  Despite lower sales volumes, the Technical Nonwovens segment reported improved adjusted EBITDA margin in the quarter compared to the fourth quarter of 2018.

"Overall, we were pleased with our cash flow from operations of $87 million in 2019, enabling us to pay down $52 million of debt."

Q4 2019 Results

Net sales decreased by $16.7 million, or 7.9%, to $193.3 million, compared to $209.9 million in the fourth quarter of 2018 primarily from lower sales in the Performance Materials ("PM") and the Technical Nonwovens ("TNW") business segments.  On an organic basis, PM segment's net sales declined by 15.1% primarily from lower sealing and advanced solutions product sales.  Weak demand for industrial filtration products in China and Europe, as well as lower sales of automotive rolled goods to the Thermal Acoustical Solutions ("TAS") segment, contributed to organic sales compression of 8.4% in the TNW business segment.  Organic sales decline was 3.1% in the TAS segment predominantly due to the General Motors strike in October that negatively impacted net sales by approximately $3.2 million in the quarter.

Gross margin was 14.5%, compared to 19.9% in the fourth quarter of 2018, and on an adjusted basis, declined 520 basis points driven primarily by declines in the TAS and PM segments with relatively flat TNW gross margin.  The TAS segment gross margin decline was due to manufacturing inefficiencies which drove increased labor, outsourcing and logistics costs at the Company's North American and European automotive facilities, as well as the unfavorable mix of lower acoustical parts sales.  Lower gross margin from the PM segment was primarily driven by unfavorable product mix, increased overhead costs and unfavorable cost absorption on lower production.

Operating loss was ($68.5) million, compared to operating income of $13.2 in the fourth quarter of 2018.  During the fourth quarter, the Company recorded non-cash impairment charges of $64.2 million, principally from goodwill impairment as the PM segment's book value exceeded its fair value.  On an adjusted basis, operating income was $0.3 million compared to $14.7 million in the fourth quarter of 2018, and was lower due to reduced gross profit and incremental intangible assets amortization of $1.4 million.  Adjusted EBITDA margin was 6.4%, compared to 12.1% in the fourth quarter of 2018.

Net loss was ($70.5) million, or ($4.07) per diluted share, compared to net income of $7.2 million, or $0.42 per diluted share in the fourth quarter of 2018.  Adjusted loss per share were ($0.17) compared to adjusted earnings per share of $0.52 in the fourth quarter of 2018.

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Full Year 2019 Results

The Company reported net sales of $837.4 million in 2019 compared to $785.9 million in 2018.  Organic sales declined 1.6%, with reductions in the PM and TNW segments and modest growth in the TAS segment.  Gross margin was 18.1% in 2019 compared to 19.4% in 2018.  The impairment charges of $64.2 million led to an operating loss of ($38.8) million in 2019 compared to operating income of $49.2 million in 2018.  Adjusted operating margin was 3.8% in 2019 compared to 7.3% in 2018.  Diluted loss per share in 2019 was ($4.08), and included $3.72 per share for the impairment charges and $0.86 per share for the pension settlement expenses, compared to diluted earnings of $2.02 per share in 2018.  Adjusted earnings per share were $0.72 in 2019 compared to $2.43 in 2018.  Adjusted EBITDA was $80.4 million in 2019 compared to $90.2 million in 2018.

Cash provided by operating activities was $86.9 million in 2019 compared to $44.7 million in 2018.  During 2019, the Company paid down $52.2 million in debt.

Liquidity

Cash was $51.3 million at December 30, 2019, compared to $49.2 million at December 31, 2018.  Net cash provided by operations was $23.9 million in the fourth quarter of 2019 compared to $30.2 million in the fourth quarter of 2018, and $86.9 million in 2019 compared to $44.7 million in 2018.  In the fourth quarter of 2019, cash from operations was positively impacted by the factoring of select trade accounts receivable to a banking institution of approximately $15 million that would have normally been collected from customers in 2020.  There was approximately $122 million of availability under the Company's credit facility at December 31, 2019.

Mr. Gonzales, concluded, "We completed a reduction-in-force program in the fourth quarter of 2019 that is expected to deliver approximately $4.5 million in savings in 2020.  The Company remains focused on cash flow generation through corporate treasury activities and working capital optimization in our segments.  We are now benefiting from a cross-currency swap to take advantage of interest rate differentials between the U.S. Dollar and Euro, which is expected to save the Company $1.3 million in interest expense in 2020."

2020 Outlook

Sara A. Greenstein, President and Chief Executive Officer, stated, "Early in my tenure, I have visited our major operations and am encouraged by the strong relationships with our customers, the quality of products we manufacture and the passion of our global workforce.

"While we have seen some recent stabilization in the end markets for Interface sealing products, weaker demand in  European industrial markets is impacting all of our segments.  In China, we are closely monitoring the impact of the coronavirus on the Company's businesses.  We expect our first quarter and full year results will be negatively impacted, but are uncertain with regards to the severity and duration of the impact.  Despite these headwinds, we expect first quarter 2020 adjusted EBITDA will improve sequentially from fourth quarter 2019 adjusted EBITDA results.

"We have started a strategic review, which we expect to conclude by the end of the second quarter of 2020, to evaluate our portfolio and end markets.  The objective is to prioritize strategic actions that optimize capital allocation and drive long-term shareholder value.   As part of the process, we are identifying specific near-term opportunities for improvement in commercial performance, cost structure and working capital."

Conference Call

Lydall will host a conference call on February 26, 2020, at 10:00 a.m. Eastern Time to discuss results for its fourth quarter and year ended December 31, 2019 as well as general matters related to its businesses and markets.  The call may be accessed at (888) 338-7142, from within the U.S., or (412) 902-4181, internationally.  In addition, the audio of the call will be webcast live and will be available for replay on the Company's website at www.lydall.com in the Investor Relations' Section.  A recording of the call will be available from 12:00 p.m. Eastern Time on February 26, 2020 through 11:59 p.m. Eastern Time on March 4, 2020 at (877) 344-7529, from within the U.S., or (412) 317-0088, internationally, pass code 10139279.  Additional information, including a presentation outlining key financial data supporting the conference call, can be found on the Company's website www.lydall.com under the Investors Relations' section.

Use of Non-GAAP Financial Measures

In addition to the financial measures prepared in accordance with generally accepted accounting principles ("GAAP"), the Company uses certain non-GAAP financial measures, including organic sales, adjusted gross profit, adjusted gross margin, adjusted operating income, adjusted operating margin, adjusted earnings per share, consolidated and segment EBITDA and adjusted EBITDA.  The attached financial tables address the non-GAAP measures used in this press release and reconcile non-GAAP measures to the most directly comparable GAAP measures.  The Company believes that the use of non-GAAP measures helps investors gain a better understanding of our core operating results and future prospects, consistent with how management measures and forecasts the Company's performance, especially when comparing such results to previous periods or forecasts.  Adjusted segment EBITDA is used as a basis to internally evaluate the financial performance of the Company's segments because the Company believes it reflects current core operating performance and provides an indicator of the segment's ability to generate cash.  Non-GAAP measures should be considered in addition to, and not as a replacement for or superior to, the corresponding GAAP measures, and may not be comparable to similarly titled measures reported by other companies.

Cautionary Note Concerning Forward-Looking Statements

This press release contains "forward-looking statements" within the Private Securities Litigation Reform Act of 1995.  Any statements contained in this press release that are not statements of historical fact, including statements about the outlook for 2020, expected savings from a reduction-in-force program, the expected impact of the coronavirus on the Company's businesses, and optimizing profit and cash flow generation may be deemed to be forward-looking statements.  All such forward-looking statements are intended to provide management's current expectations for the future operating and financial performance of the Company based on current expectations and assumptions relating to the Company's business, the economy and other future conditions.  Forward-looking statements generally can be identified through the use of words such as "believes," "anticipates," "may," "should," "will," "plans," "projects," "expects," "expectations," "estimates," "forecasts," "predicts," "targets," "prospects," "strategy," "signs," and other words of similar meaning in connection with the discussion of future operating or financial performance.  Because forward-looking statements relate to the future, they are subject to inherent risks, uncertainties and changes in circumstances that are difficult to predict.  Such risks and uncertainties which include, among others, worldwide economic or political changes that affect the markets that the Company's businesses serve which could have an effect on demand for the Company's products and impact the Company's profitability, challenges encountered by the Company in the execution of restructuring programs, challenges in integrating acquired companies, disruptions in the global credit and financial markets, including diminished liquidity and credit availability, changes in international trade agreements, including tariffs and trade restrictions, disruptions in the Company's businesses from the coronavirus, foreign currency volatility, swings in consumer confidence and spending, unstable economic growth, raw material pricing and supply issues, fluctuations in unemployment rates, retention of key employees and the successful execution of the CEO transition, increases in fuel prices, and outcomes of legal proceedings, claims and investigations.  Accordingly, the Company's actual results may differ materially from those contemplated by these forward-looking statements.  Investors, therefore, are cautioned against relying on any of these forward-looking statements.  They are neither statements of historical fact nor guarantees or assurances of future performance.  Additional information regarding the factors that may cause actual results to differ materially from these forward-looking statements is available in Lydall's filings with the Securities and Exchange Commission, including the risks and uncertainties identified in Part I, Item 1A - Risk Factors of Lydall's Annual Report on Form 10-K for the year ended December 31, 2019.

These forward-looking statements speak only as of the date of this press release, and Lydall does not assume any obligation to update or revise any forward-looking statement made in this press release or that may from time to time be made by or on behalf of the Company.

Lydall, Inc. is a New York Stock Exchange listed company, headquartered in Manchester, Connecticut with global manufacturing operations producing specialty engineered products for the thermal/acoustical and filtration/separation markets. For more information, visit http://www.lydall.com. Lydall® is a registered trademark of Lydall, Inc. in the U.S. and other countries.


        
        
Summary of Operations       
In thousands except per share data       
(Unaudited)       
 Quarters Ended Years Ended
 December 31, December 31,
 2019 2018 2019 2018
        
Net sales$193,288  $209,938  $837,398  $785,897 
Cost of sales165,185  168,066  685,608  633,252 
Gross profit28,103  41,872  151,790  152,645 
        
Selling, product development and administrative expenses32,398  28,702  126,409  103,457 
Impairment of goodwill and other long-lived assets64,206    64,206   
Operating (loss) income(68,501) 13,170  (38,825) 49,188 
        
Employee benefit plan settlement (income) expense(454)   25,247   
Interest expense3,237  3,595  14,262  6,212 
Other expense (income), net102  (196) (1,257) (289)
(Loss) income before income taxes(71,386) 9,771  (77,077) 43,265 
        
Income tax (benefit) expense(897) 2,599  (6,416) 8,453 
Income from equity method investment(28) (12) (148) (132)
Net (loss) income$(70,461) $7,184  $(70,513) $34,944 
        
(Loss) earnings per share:       
Basic$(4.07) $0.42  $(4.08) $2.03 
Diluted$(4.07) $0.42  $(4.08) $2.02 
        
Weighted average number of common shares outstanding17,293  17,239  17,271  17,204 
Weighted average number of common shares and equivalents outstanding17,293  17,302  17,271  17,330 


         
Summary of Segment Information        
and Corporate Office Expenses        
In thousands        
(Unaudited)        
  Quarters Ended Years Ended
  December 31, December 31,
  2019 2018 2019 2018
Net Sales        
         
Performance Materials Segment (1) $55,798  $65,570  $245,480  $169,217 
Technical Nonwovens Segment (2),(3) 56,750  64,747  255,346  277,071 
Thermal Acoustical Solutions 86,066  85,610  361,577  365,427 
Eliminations and Other (3) (5,326) (5,989) (25,005) (25,818)
Consolidated Net Sales $193,288  $209,938  $837,398  $785,897 
         
Operating Income        
         
Performance Materials Segment (1) $(65,278) $5,096  $(59,804) $13,139 
Technical Nonwovens Segment (2),(3) 3,152  3,928  22,895  21,323 
Thermal Acoustical Solutions 1,720  8,728  23,590  38,085 
Corporate Office Expenses (8,095) (4,582) (25,506) (23,359)
Consolidated Operating (Loss) Income $(68,501) $13,170  $(38,825) $49,188 

(1) The Performance Materials segment reports the results of Interface and PCC for the periods following the date of acquisitions of August 31, 2018 and July 12, 2018, respectively, and included $1.5 million and $12.7 million of incremental intangible assets amortization for the quarter and year ended December 31, 2019, respectively.

(2) The Technical Nonwovens segment reports the results of Geosol through the date of disposition of May 9, 2019.

(3) Included in the Technical Nonwovens segment and Eliminations and Other is $4.4 million and $5.1 million in intercompany sales to the Thermal Acoustical Solutions segment for the quarters ended December 31, 2019 and 2018, respectively, and $21.0 million and $22.2 million for the years ended December 31, 2019 and 2018, respectively.


     
Financial Position    
In thousands except ratio data    
(Unaudited)    
  December 31, 2019 December 31, 2018
     
Cash and cash equivalents $51,331  $49,237 
Working capital $153,739  $195,732 
Total debt $272,641  $324,813 
Stockholders' equity $318,420  $369,275 
Total capitalization $591,061  $694,088 
Total debt to total capitalization 46.1% 46.8%


         
Cash Flows        
In thousands Quarters Ended Years Ended
(Unaudited) December 31, December 31,
  2019 2018 2019 2018
         
Net cash provided by operating activities $23,898  $30,241  $86,862  $44,739 
Net cash used for investing activities $(8,613) $(11,184) $(32,385) $(300,965)
Net cash (used for) provided by financing activities $(13,697) $(13,082) $(51,927) $247,476 
Depreciation and amortization $12,318  $10,720  $49,000  $33,162 
Capital expenditures $(8,614) $(11,200) $(35,850) $(31,291)


     
Common Stock Data    
  Quarters Ended December 31,
  2019 2018
     
High $25.84  $44.03 
Low $17.93  $18.47 
Close $20.52  $20.31 

During the fourth quarter of 2019, 9,283,443 shares of Lydall common stock (LDL) were traded on the New York Stock Exchange.


Non-GAAP Measures
In thousands except ratio and per share data
(Unaudited)

The following tables address the non-GAAP measures used in this press release and reconcile the non-GAAP measures to the most directly comparable GAAP measures:

  Quarters Ended December 31, Years Ended December 31,
  2019 2018 2019 2018
         
Net sales $193,288  $209,938  $837,398  $785,897 
Net sales, adjusted $193,288  $209,938  $837,398  $785,897 
         
Gross profit, as reported $28,103  $41,872  $151,790  $152,645 
TNW restructuring expenses 150  169  630  1,894 
Inventory step-up purchase accounting adjustments   585    1,975 
Reduction-in-force severance expenses $987  $  $987  $ 
Gross profit, adjusted $29,240  $42,626  $153,407  $156,514 
         
Gross margin, as reported 14.5% 19.9% 18.1% 19.4%
Gross margin, adjusted 15.1% 20.3% 18.3% 19.9%
         
Operating (loss) income, as reported $(68,501) $13,170  $(38,825) $49,188 
Strategic initiatives expenses 210  594  1,456  3,631 
TNW restructuring expenses 177  358  767  2,296 
Inventory step-up purchase accounting adjustments   585    1,975 
Impairment of long-lived assets 64,206    64,206   
CEO transition expenses 2,259    2,259   
Reduction-in-force severance expenses 1,943    1,943   
Operating income, adjusted $294  $14,707  $31,806  $57,090 
         
Operating margin, as reported (35.4)% 6.3% (4.6)% 6.3%
Operating margin, adjusted 0.2% 7.0% 3.8% 7.3%
         
(Loss) earnings per share, as reported $(4.07) $0.42  $(4.08) $2.02 
Strategic initiatives expenses $0.01  $0.03  $0.09  $0.21 
TNW restructuring expenses $0.01  $0.02  $0.04  $0.13 
Inventory step-up purchase accounting adjustments $  $0.03  $  $0.11 
Impairment of long-lived assets $3.71  $  $3.71  $ 
CEO transition expenses $0.13  $  $0.13  $ 
Reduction-in-force severance expenses $0.11  $  $0.11  $ 
Employee benefit plans settlement expenses $(0.03) $  $1.46  $ 
Gain on sale from a divestiture $  $  $(0.08) $ 
Tax effect of above adjustments $(0.04) $  $(0.66) $(0.06)
Discrete tax adjustments $  $0.02  $  $0.02 
Diluted (loss) earnings per share, adjusted $(0.17) $0.52  $0.72  $2.43 
 

This press release reports adjusted results for the quarters and years ended December 31, 2019 and 2018, which excludes strategic initiatives expenses, restructuring expenses in the Technical Nonwovens segment, purchase accounting adjustments related to inventory step-up in the Performance Materials segment, impairment charges in the Performance Materials segment, corporate office CEO transition expenses, reduction-in-force severance expenses, employee benefit plans settlement expenses (income), gain on sale from a divestiture and discrete tax adjustments.

CONSOLIDATED AND SEGMENT EBITDA/ADJUSTED EBITDA
In thousands except ratio data
(Unaudited)

The following tables report consolidated and segment earnings before interest, taxes, depreciation and amortization ("EBITDA") and adjusted EBITDA for the quarters and years ended December 31, 2019 and 2018.  The Company uses segment operating income (loss) for the purpose of calculating segment EBITDA and adjusted EBITDA.  Adjusted EBITDA excludes strategic initiatives expenses, restructuring expenses, non-cash impairment charges, purchase accounting adjustments related to inventory step-up, CEO transition expenses, reduction-in-force severance expenses, employee benefit plans settlement expenses (income) and gain on sale from a divestiture.

   
  For the Quarter Ended December 31, 2019
  Segments    
  Performance
Materials
 Technical
Nonwovens
 Thermal
Acoustical
Solutions
 Total Corporate
Office
 Consolidated
Lydall
             
Net loss           $(70,461)
Employee benefits plans settlement income           (454)
Interest expense           3,237 
Income tax benefit           (897)
Other expense, net           102 
Income from equity method investment           (28)
Operating (loss) income $(65,278) $3,152  $1,720  $(60,406) $(8,095) $(68,501)
Depreciation and amortization 6,329  3,176  2,552  12,057  148  12,205 
Employee benefits plans settlement income         (454) (454)
Other expense, net         102  102 
Income from equity method investment   (28)   (28)   (28)
EBITDA $(58,949) $6,356  $4,272  $(48,321) $(7,595) $(55,916)
% of net sales (105.6)% 11.2% 5.0% (24.3)%   (28.9)%
             
Strategic initiatives expenses $  $  $  $  $210  $210 
TNW restructuring expenses $  $177  $  $177  $  $177 
Impairment of long-lived assets 64,206      64,206    64,206 
CEO transition expenses         2,259  2,259 
Reduction-in-force severance expenses 295  253  1,386  1,934  9  1,943 
Employee benefit plans settlement income         (454) (454)
EBITDA, adjusted $5,552  $6,786  $5,658  $17,996  $(5,571) $12,425 
% of net sales 10.0% 12.0% 6.6% 9.1%   6.4%


   
  For the Quarter Ended December 31, 2018
  Segments    
  Performance
Materials
 Technical
Nonwovens
 Thermal
Acoustical
Solutions
 Total Corporate
Office
 Consolidated
Lydall
             
Net income           $7,184 
Interest expense           3,595 
Income tax expense           2,599 
Other income, net           (196)
Income from equity method investment           (12)
Operating income (loss) $5,096  $3,928  $8,728  $17,752  $(4,582) $13,170 
Depreciation and amortization 4,634  3,309  2,369  10,312  175  10,487 
Other income, net         (196) (196)
Income from equity method investment   (12)   (12)   (12)
EBITDA $9,730  $7,249  $11,097  $28,076  $(4,211) $23,865 
% of net sales 14.8% 11.2% 13.0% 13.0%   11.4%
             
Strategic initiatives expenses $  $  $  $  $594  $594 
TNW restructuring expenses   358    358    358 
Inventory step-up purchase accounting adjustments 585      585    585 
EBITDA, adjusted $10,315  $7,607  $11,097  $29,019  $(3,617) $25,402 
% of net sales 15.7% 11.7% 13.0% 13.4%   12.1%


   
  For the Year Ended December 31, 2019
  Segments    
  Performance
Materials
 Technical
Nonwovens
 Thermal
Acoustical
Solutions
 Total Corporate
Office
 Consolidated
Lydall
             
Net loss           $(70,513)
Employee benefit plans settlement expenses           25,247 
Interest expense           14,262 
Income tax benefit           (6,416)
Other income, net           (1,257)
Income from equity method investment           (148)
Operating income (loss) $(59,804) $22,895  $23,590  $(13,319) $(25,506) $(38,825)
Depreciation and amortization 25,118  12,702  10,168  47,988  635  48,623 
Employee benefit plans settlement expenses         25,247  25,247 
Other income, net         (1,257) (1,257)
Income from equity method investment   (148)   (148)   (148)
EBITDA $(34,686) $35,745  $33,758  $34,817  $(48,861) $(14,044)
% of net sales (14.1)% 14.0% 9.3% 4.0%   (1.7)%
             
Strategic initiatives expenses $  $  $  $  $1,456  $1,456 
TNW restructuring expenses   767    767    767 
Impairment of long-lived assets 64,206      64,206    64,206 
CEO transition expenses         2,259  2,259 
Reduction-in-force severance expenses 295  253  1,386  1,934  9  1,943 
Employee benefit plans settlement expenses         25,247  25,247 
Gain on sale from a divestiture         (1,459) (1,459)
EBITDA, adjusted $29,815  $36,765  $35,144  $101,724  $(21,349) $80,375 
% of net sales 12.1% 14.4% 9.7% 11.8%   9.6%


   
  For the Year Ended December 31, 2018
  Segments    
  Performance
Materials
 Technical
Nonwovens
 Thermal
Acoustical
Solutions
 Total Corporate
Office
 Consolidated
Lydall
             
Net income           $34,944 
Interest expense           6,212 
Income tax expense           8,453 
Other income, net           (289)
Income from equity method investment           (132)
Operating income (loss) $13,139  $21,323  $38,085  $72,547  $(23,359) $49,188 
Depreciation and amortization 9,006  13,877  9,190  32,073  658  32,731 
Other income, net         (289) (289)
Income from equity method investment   (132)   (132)   (132)
EBITDA $22,145  $35,332  $47,275  $104,752  $(22,412) $82,340 
% of net sales 13.1% 12.8% 12.9% 12.9%   10.5%
             
Strategic initiatives expenses $233  $  $  $233  $3,398  $3,631 
TNW restructuring expenses   2,296    2,296    2,296 
Inventory step-up purchase accounting adjustments 1,975      1,975    1,975 
EBITDA, adjusted $24,353  $37,628  $47,275  $109,256  $(19,014) $90,242 
% of net sales 14.4% 13.6% 12.9% 13.5%   11.5%


Organic Sales
(Unaudited)

  Quarter Ended December 31, 2019
  Performance
Materials
 Technical
Nonwovens
 Thermal Acoustical Solutions Consolidated
Sales growth, as reported (14.9)% (12.4)% 0.5% (7.9)%
Acquisitions and divestitures 0.8% (3.3)% % (0.7)%
Change in tooling sales % % 4.7% 1.9%
Foreign currency translation (0.6)% (0.7)% (1.1)% (0.8)%
Organic sales growth (15.1)% (8.4)% (3.1)% (8.3)%
         
  Year Ended December 31, 2019
  Performance
Materials
 Technical
Nonwovens
 Thermal Acoustical Solutions Consolidated
Sales growth, as reported 45.1% (7.8)% (1.1)% 6.6%
Acquisitions and divestitures 52.3% (2.5)% % 10.4%
Change in tooling sales 0.1% % (0.4)% (0.1)%
Foreign currency translation (1.5)% (2.6)% (1.8)% (2.1)%
Organic sales growth (5.8)% (2.7)% 1.1% (1.6)%
             

This press release provides information regarding organic sales change, defined as net sales change excluding (1) sales from acquired and divested businesses (2) the impact of foreign currency translation and (3) tooling sales.  Management believes that the presentation of organic sales change is useful to investors because it enables them to assess, on a consistent basis, sales trends related to the Company selling products to customers, without the impact of foreign currency rate changes that are not under management's control and do not reflect the performance of the Company and management.  Tooling sales are excluded because tooling revenue is not generated from selling the Company's products to customers, but rather is reimbursement from our customers for the design and production of tools used by the Company in our manufacturing processes.  Tooling sales can be sporadic and may mask underlying business conditions and obscure business trends.

 

For further information:
Brendan Moynihan
Vice President, Financial Planning and Investor Relations
Telephone 860-646-1233
Facsimile 860-646-4917
info@lydall.com
www.lydall.com

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Posted In: EarningsPress Releases
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