Koppers Reports Fourth Quarter and Full-Year 2021 Results; Provides 2022 Outlook
Koppers Holdings reported a net income of $22.2 million ($1.02 per share) in Q4 2021, up from $18.6 million ($0.86 per share) YoY. Consolidated sales rose 3.1% to $405.3 million. The Carbon Materials and Chemicals segment saw a significant increase in sales, rising 37.7% to $130.8 million, with record profitability. Conversely, sales in the Railroad and Utility Products fell 7.5% due to deferred purchases. For 2022, Koppers aims for sales of $1.8 billion and adjusted EBITDA of $230 million, amid rising tax rates expected to impact EPS.
- Net income increased to $22.2 million in Q4 2021, up from $18.6 million in Q4 2020.
- Consolidated sales rose by 3.1% to $405.3 million in Q4 2021.
- Carbon Materials and Chemicals segment achieved record profitability with a 37.7% sales increase.
- Projected sales of $1.8 billion and adjusted EBITDA of $230 million for 2022.
- Sales in Railroad and Utility Products decreased by 7.5%, mainly due to deferred purchases.
- Adjusted EBITDA for Railroad and Utility Products fell to $6.2 million, down from $10.3 million YoY.
- Higher tax rates expected in 2022 could negatively impact adjusted EPS by approximately $0.17.
PITTSBURGH, Feb. 23, 2022 /PRNewswire/ -- Koppers Holdings Inc. (NYSE: KOP), an integrated global provider of treated wood products, wood treatment chemicals and carbon compounds, today reported net income attributable to Koppers for the fourth quarter of 2021 of
Adjusted net income attributable to Koppers and adjusted earnings per share (EPS) were
Consolidated sales were
The Railroad and Utility Products and Services (RUPS) business experienced lower sales and profitability than the prior year, primarily driven by railroad customers deferring purchases due to higher prices for untreated crossties, lower volumes for the utility pole businesses, and non-recurring costs associated with transitioning to new preservative systems, partly offset by price increases across product lines.
The Performance Chemicals (PC) segment reported lower sales and profitability against strong results from the prior year quarter. This reflected softer customer demand in North America driven by a return to pre-pandemic volumes as well as higher raw material costs, partly offset by price increases implemented globally.
The Carbon Materials and Chemicals (CMC) segment delivered significantly higher sales compared with the prior year and record profitability for the quarter, due to strong end market demand which supported a favorable pricing environment that outpaced raw material cost increases.
As previously reported, the divestiture of Koppers (Jiangsu) Carbon Chemical Company Limited (KJCC) was completed on September 30, 2020 and KJCC results were classified as held for sale and as discontinued operations beginning in 2020.
President and CEO Leroy Ball said, "I'm happy we finished the year strong, posting a new quarterly high in CMC adjusted EBITDA and setting a new annual high in PC adjusted EBITDA. Once again, the balance in our business portfolio paid off as strong CMC end markets more than offset difficult, but mostly transitory, cost and supply issues in RUPS. PC had a nice bounce-back quarter to finish at a new high for adjusted EBITDA, the second straight year of achieving above
Fourth Quarter Financial Performance
- Sales for RUPS of
$155.6 million decreased by$12.6 million , or 7.5 percent, compared to sales of$168.2 million in the prior year quarter. Sales decreased from prior year, primarily driven by lower crosstie volumes from Class I and commercial customers as well as reduced volumes for utility poles in the United States and Australia, partly offset by pricing increases. Market prices for untreated crossties remain elevated due to strong demand for lumber in construction markets, resulting in lower purchases by railroad customers. Adjusted EBITDA was$6.2 million , or 4.0 percent, in the fourth quarter, compared with$10.3 million , or 6.1 percent, in the prior year quarter. Profitability was unfavorably impacted by lower treating activities for crossties and utility poles, which resulted in reduced capacity utilization, costs related to the conversion to new preservative systems for pole treatment, and higher raw materials and transportation costs. - Sales for PC of
$118.9 million decreased by$11.0 million , or 8.5 percent, compared to sales of$129.9 million in the prior year quarter. The decline in sales was primarily due to lower volumes of preservatives in North America as a shift in consumer spending habits have tempered customer demand, compared with high levels of demand in the prior year period as a result of the pandemic, partly offset by higher demand in international markets such as Brazil and New Zealand. Adjusted EBITDA for the fourth quarter was$19.4 million , or 16.3 percent, compared with$23.0 million , or 17.7 percent, in the prior year quarter. Profitability was lower than prior year due to decreased volumes along with higher input costs, partly offset by price increases. - Sales for CMC totaling
$130.8 million increased by$35.8 million , or 37.7 percent, compared to sales of$95.0 million in the prior year quarter. Excluding an unfavorable impact from foreign currency changes of$2.9 million , sales increased by$38.7 million , or 40.7 percent, from the prior year quarter. Sales benefited from higher sales pricing for carbon pitch, distillates and chemicals, partly offset by lower sales volumes of carbon black feedstock in certain regions. This was a record quarter for adjusted EBITDA, which was$24.9 million , or 19.0 percent, compared with$14.4 million , or 15.2 percent, in the prior year quarter. The increase in profitability reflects a favorable demand and pricing environment, partly offset by higher raw material costs. - Net income attributable to Koppers was
$22.2 million , compared to$18.6 million in the prior year quarter. Adjusted net income was$16.9 million for the fourth quarter, compared to$16.2 million in the prior year quarter. Adjusted EBITDA was$48.8 million , or 12.0 percent, in the fourth quarter, compared with$47.1 million , or 12.0 percent, in the prior year quarter. - Diluted EPS from continuing operations was
$1.02 , compared to$0.86 per diluted share in the prior year quarter. Adjusted EPS for the quarter was$0.77 , compared with$0.75 for the prior year period.
Full-Year 2021 Financial Performance
- Consolidated sales of
$1.67 9 billion increased by approximately$10 million , as compared to$1.66 9 billion in the prior year. Despite continued challenges associated with the global pandemic, 2021 sales, excluding KJCC, represented the highest level of revenues in the history of the company. - Sales for RUPS of
$729.9 million decreased by$29.2 million , or 3.8 percent, compared to sales of$759.1 million in the prior year. Adjusted EBITDA was$45.4 million , or 6.2 percent, compared with$65.3 million , or 8.6 percent, in the prior year. - Sales for PC of
$503.3 million decreased by$23.0 million , or 4.4 percent, compared to sales of$526.3 million in the prior year. Adjusted EBITDA, a record, was$101.8 million , or 20.2 percent, compared with$100.7 million , or 19.1 percent, in the prior year. - Sales for CMC totaling
$445.4 million increased by$61.7 million , or 16.1 percent, compared to sales of$383.7 million in the prior year. Adjusted EBITDA was$76.3 million , or 17.1 percent, compared with$45.0 million , or 11.7 percent, in the prior year. - Net income attributable to Koppers was
$85.2 million , compared with$122.0 million in the prior year. Adjusted net income was$92.3 million , compared with$88.0 million in the prior year. Adjusted EBITDA was$223.5 million , or 13.3 percent, compared with$211.0 million , or 12.6 percent, in the prior year. - Diluted EPS from continuing operations was
$3.90 , compared with$4.17 per share in the prior year. Adjusted EPS was$4.21 , compared with$4.12 for the prior year. - Capital expenditures for the twelve months ended December 31, 2021, were
$125.0 million , compared with$69.8 million for the prior year period. Net of insurance proceeds and cash provided from asset sales, capital expenditures were$89.5 million for the current year. The year-over-year increase was consistent with the company's projected net capital investments, primarily driven by growth and productivity projects.
2022 Outlook
Koppers remains committed to driving improvements through the execution of its strategic initiatives and making continued progress toward its long-term financial goals. Based on current global economic activity and in consideration of the ongoing economic uncertainty associated with the pandemic, Koppers expects that 2022 sales will be approximately
The effective tax rate for adjusted net income in 2022 is projected to be approximately 30 percent, compared to the tax rate in 2021, excluding certain income tax effects relating to non-recurring items, of 27 percent. The higher 2022 tax rate is primarily due to higher anticipated interest expense deduction disallowances. Accordingly, the 2022 adjusted EPS is forecasted to be approximately
Koppers expects to invest approximately
Commenting on the forecast, Mr. Ball said, "We are projecting 2022 to be our eighth straight year of adjusted EBITDA improvement and another new all-time high, excluding KJCC. Accordingly and despite higher tax rates taking a bite out of EPS, we are also projecting our third straight new high for adjusted EPS. Those expectations are based upon strong end markets supporting CMC, solid but normalized demand levels for PC, and an improving backdrop for hardwood sourcing in our RUPS business. We are also expecting to achieve price increases totaling
Investor Conference Call and Webcast
Koppers management will conduct a conference call this morning, beginning at 11:00 a.m. Eastern Time to discuss the company's results for the quarter. Presentation materials will be available at least 15 minutes before the call on www.koppers.com in the Investor Relations section of the company's website.
Interested parties may access the live audio broadcast toll free by dialing 1-833-366-1128 in the United States and Canada, or 1-412-902-6774 for international, Conference ID number 10163696. Participants are requested to access the call at least five minutes before the scheduled start time to complete a brief registration. The conference call will be broadcast live on www.koppers.com and can also be accessed here.
An audio replay will be available approximately two hours after the completion of the call at 1-877-344-7529 for U.S. toll free, 855-669-9658 for Canada toll free, or 1-412-317-0088 for international, using replay access code 8482786. The recording will be available for replay through May 23, 2022.
About Koppers
Koppers, with corporate headquarters in Pittsburgh, Pennsylvania, is an integrated global provider of treated wood products, wood treatment chemicals, and carbon compounds. Our products and services are used in a variety of niche applications in a diverse range of end markets, including the railroad, specialty chemical, utility, residential lumber, agriculture, aluminum, steel, rubber, and construction industries. We serve our customers through a comprehensive global manufacturing and distribution network, with facilities located in North America, South America, Australasia, and Europe. The stock of Koppers Holdings Inc. is publicly traded on the New York Stock Exchange under the symbol "KOP."
For more information, visit: www.koppers.com. Inquiries from the media should be directed to Ms. Jessica Franklin at FranklinJM@koppers.com or 412-227-2025. Inquiries from the investment community should be directed to Ms. Quynh McGuire at McGuireQT@koppers.com or 412-227-2049.
Non-GAAP Financial Measures
This press release contains certain non-GAAP financial measures. Koppers believes that adjusted EBITDA, adjusted EBITDA margin, adjusted net income, adjusted earnings per share, net debt and net leverage ratio provide information useful to investors in understanding the underlying operational performance of the company, its business and performance trends, and facilitate comparisons between periods and with other corporations in similar industries. The exclusion of certain items permits evaluation and a comparison of results for ongoing business operations, and it is on this basis that Koppers management internally assesses the company's performance. In addition, the Board of Directors and executive management team use adjusted EBITDA as a performance measure under the company's annual incentive plans.
Although Koppers believes that these non-GAAP financial measures enhance investors' understanding of its business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP basis financial measures and should be read in conjunction with the relevant GAAP financial measure. Other companies in a similar industry may define or calculate these measures differently than the company, limiting their usefulness as comparative measures. Because of these limitations, these non-GAAP financial measures should not be considered in isolation or as substitutes for performance measures calculated in accordance with GAAP.
See the attached tables for the following reconciliations of non-GAAP financial measures included in this press release: Unaudited Reconciliation of Net Income to Adjusted EBITDA; Unaudited Reconciliation of Net Income Attributable to Koppers and Adjusted Net Income; Unaudited Reconciliation of Diluted Earnings Per Share and Adjusted Earnings Per Share; and Unaudited Reconciliation of Total Debt to Net Debt and Net Leverage Ratio.
Koppers does not provide reconciliations of guidance for adjusted EBITDA and adjusted EPS to comparable GAAP measures, in reliance on the unreasonable efforts exception. Koppers is unable, without unreasonable efforts, to forecast certain items required to develop meaningful comparable GAAP financial measures. These items include, but are not limited to, restructuring and impairment charges, acquisition-related costs, mark-to-market commodity hedging, and LIFO adjustments that are difficult to predict in advance in order to include in a GAAP estimate and may be significant.
Safe Harbor Statement
Certain statements in this press release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and may include, but are not limited to, statements about sales levels, acquisitions, restructuring, declines in the value of Koppers assets and the effect of any resulting impairment charges, profitability and anticipated expenses and cash outflows.
All forward-looking statements involve risks and uncertainties. All statements contained herein that are not clearly historical in nature are forward-looking, and words such as "outlook," "guidance," "forecast," "believe," "anticipate," "expect," "estimate," "may," "will," "should," "continue," "plan," "potential," "intend," "likely," or other similar words or phrases are generally intended to identify forward-looking statements. Any forward-looking statement contained herein, in other press releases, written statements or other documents filed with the Securities and Exchange Commission, or in Koppers communications and discussions with investors and analysts in the normal course of business through meetings, phone calls and conference calls, regarding expectations with respect to sales, earnings, cash flows, operating efficiencies, restructurings, the benefits of acquisitions, divestitures, joint ventures or other matters as well as financings and debt reduction, are subject to known and unknown risks, uncertainties and contingencies.
Many of these risks, uncertainties and contingencies are beyond our control, and may cause actual results, performance or achievements to differ materially from anticipated results, performance or achievements. Factors that might affect such forward-looking statements include, among other things, the impact of changes in commodity prices, such as oil and copper, on product margins; general economic and business conditions; existing and future adverse effects as a result of the coronavirus (COVID-19) pandemic; disruption in the U.S. and global financial markets; potential difficulties in protecting our intellectual property; the ratings on our debt and our ability to repay or refinance our outstanding indebtedness as it matures; our ability to operate within the limitations of our debt covenants; potential impairment of our goodwill and/or long-lived assets; demand for Koppers goods and services; competitive conditions; interest rate and foreign currency rate fluctuations; availability and costs of key raw materials; unfavorable resolution of claims against us, as well as those discussed more fully elsewhere in this release and in documents filed with the Securities and Exchange Commission by Koppers, particularly our latest annual report on Form 10-K and any subsequent filings by Koppers with the Securities and Exchange Commission. Any forward-looking statements in this release speak only as of the date of this release, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after that date or to reflect the occurrence of unanticipated events.
KOPPERS HOLDINGS INC. | ||||||||||||||||
UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS | ||||||||||||||||
(Dollars in millions, except per share amounts) | ||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net sales | $ | 405.3 | $ | 393.1 | $ | 1,678.6 | $ | 1,669.1 | ||||||||
Cost of sales | 332.4 | 303.9 | 1,344.5 | 1,308.7 | ||||||||||||
Depreciation and amortization | 14.3 | 14.4 | 57.7 | 54.1 | ||||||||||||
Selling, general and administrative expenses | 38.3 | 39.0 | 148.9 | 143.1 | ||||||||||||
Impairment and restructuring charges | 0.0 | 1.0 | 2.2 | 6.5 | ||||||||||||
(Gain) on sale of assets | (23.4) | 0.0 | (31.2) | 0.0 | ||||||||||||
Operating profit | 43.7 | 34.8 | 156.5 | 156.7 | ||||||||||||
Other income, net | 0.9 | 0.4 | 3.6 | 2.3 | ||||||||||||
Interest expense | 10.0 | 10.3 | 40.5 | 48.9 | ||||||||||||
Income from continuing operations before income taxes | 34.6 | 24.9 | 119.6 | 110.1 | ||||||||||||
Income tax provision | 12.1 | 6.2 | 34.5 | 21.0 | ||||||||||||
Income from continuing operations | 22.5 | 18.7 | 85.1 | 89.1 | ||||||||||||
Income (loss) from discontinued operations, net of tax expense of | 0.0 | (0.1) | 0.1 | (3.9) | ||||||||||||
(Loss) gain on sale of discontinued operations, net of tax benefit (expense) of | (0.3) | 0.0 | (0.3) | 35.8 | ||||||||||||
Net income | 22.2 | 18.6 | 84.9 | 121.0 | ||||||||||||
Loss attributable to noncontrolling interests | 0.0 | 0.0 | (0.3) | (1.0) | ||||||||||||
Net income attributable to Koppers | $ | 22.2 | $ | 18.6 | $ | 85.2 | $ | 122.0 | ||||||||
Earnings (loss) per common share attributable to Koppers common shareholders: | ||||||||||||||||
Basic - | ||||||||||||||||
Continuing operations | $ | 1.06 | $ | 0.88 | $ | 4.02 | $ | 4.25 | ||||||||
Discontinued operations | (0.02) | 0.00 | (0.02) | 1.56 | ||||||||||||
Earnings per basic common share | $ | 1.04 | $ | 0.88 | $ | 4.00 | $ | 5.81 | ||||||||
Diluted - | ||||||||||||||||
Continuing operations | $ | 1.02 | $ | 0.86 | $ | 3.90 | $ | 4.17 | ||||||||
Discontinued operations | (0.01) | 0.00 | (0.02) | 1.54 | ||||||||||||
Earnings per diluted common share | $ | 1.01 | $ | 0.86 | $ | 3.88 | $ | 5.71 | ||||||||
Weighted average shares outstanding (in thousands): | ||||||||||||||||
Basic | 21,193 | 21,066 | 21,238 | 20,992 | ||||||||||||
Diluted | 21,917 | 21,621 | 21,925 | 21,374 | ||||||||||||
KOPPERS HOLDINGS INC. | ||||||||
UNAUDITED CONSOLIDATED BALANCE SHEET | ||||||||
(Dollars in millions, except per share amounts) | ||||||||
December 31, 2021 | December 31, 2020 | |||||||
Assets | ||||||||
Cash and cash equivalents, including restricted cash | $ | 45.5 | $ | 38.5 | ||||
Accounts receivable, net of allowance of | 182.8 | 175.1 | ||||||
Inventories, net | 313.8 | 295.8 | ||||||
Derivative contracts | 61.0 | 38.5 | ||||||
Other current assets | 25.0 | 16.6 | ||||||
Total current assets | 628.1 | 564.5 | ||||||
Property, plant and equipment, net | 489.1 | 409.1 | ||||||
Operating lease right-of-use assets | 91.2 | 102.5 | ||||||
Goodwill | 296.0 | 297.8 | ||||||
Intangible assets, net | 131.5 | 149.8 | ||||||
Deferred tax assets | 15.0 | 18.4 | ||||||
Non-current derivative contracts | 0.0 | 31.9 | ||||||
Other assets | 11.0 | 24.6 | ||||||
Total assets | $ | 1,661.9 | $ | 1,598.6 | ||||
Liabilities | ||||||||
Accounts payable | $ | 171.9 | $ | 154.1 | ||||
Accrued liabilities | 90.5 | 106.7 | ||||||
Current operating lease liabilities | 21.3 | 21.2 | ||||||
Current maturities of long-term debt | 2.0 | 10.1 | ||||||
Total current liabilities | 285.7 | 292.1 | ||||||
Long-term debt | 781.5 | 765.8 | ||||||
Accrued postretirement benefits | 38.6 | 46.2 | ||||||
Deferred tax liabilities | 33.4 | 21.3 | ||||||
Operating lease liabilities | 70.3 | 81.3 | ||||||
Other long-term liabilities | 41.6 | 45.9 | ||||||
Total liabilities | 1,251.1 | 1,252.6 | ||||||
Commitments and contingent liabilities | ||||||||
Equity | ||||||||
Senior Convertible Preferred Stock, 10,000,000 shares authorized; no shares issued | 0.0 | 0.0 | ||||||
Common Stock, 24,026,844 and 23,688,347 shares issued | 0.2 | 0.2 | ||||||
Additional paid-in capital | 249.5 | 234.1 | ||||||
Retained earnings | 300.9 | 215.8 | ||||||
Accumulated other comprehensive loss | (40.0) | (15.9) | ||||||
Treasury stock, at cost, 2,930,694 and 2,589,803 shares | (104.0) | (92.5) | ||||||
Total Koppers shareholders' equity | 406.6 | 341.7 | ||||||
Noncontrolling interests | 4.2 | 4.3 | ||||||
Total equity | 410.8 | 346.0 | ||||||
Total liabilities and equity | $ | 1,661.9 | $ | 1,598.6 | ||||
KOPPERS HOLDINGS INC. | ||||||||
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS | ||||||||
(Dollars in millions) | ||||||||
Year Ended December 31, | ||||||||
2021 | 2020 | |||||||
Cash provided by (used in) operating activities: | ||||||||
Net income | $ | 84.9 | $ | 121.0 | ||||
Adjustments to reconcile net cash provided by (used in) operating activities: | ||||||||
Depreciation and amortization | 57.7 | 54.1 | ||||||
Stock-based compensation | 13.0 | 11.3 | ||||||
Change in derivative contracts | 3.8 | (9.2) | ||||||
Non-cash interest expense | 2.7 | 2.6 | ||||||
Loss (gain) on sale of discontinued operations | 0.3 | (35.8) | ||||||
(Gain) on sale of assets and investment | (31.5) | 0.0 | ||||||
Insurance proceeds | (6.1) | (0.7) | ||||||
Deferred income taxes | 16.9 | 9.4 | ||||||
Change in other liabilities | 2.1 | (8.6) | ||||||
Other - net | 4.0 | (0.4) | ||||||
Changes in working capital: | ||||||||
Accounts receivable | (12.7) | (11.5) | ||||||
Inventories | (24.3) | 8.7 | ||||||
Accounts payable | 20.9 | (25.3) | ||||||
Accrued liabilities | (21.0) | 8.5 | ||||||
Other working capital | (7.7) | 3.0 | ||||||
Net cash provided by operating activities | 103.0 | 127.1 | ||||||
Cash (used in) provided by investing activities: | ||||||||
Capital expenditures | (125.0) | (69.8) | ||||||
Insurance proceeds | 6.1 | 0.7 | ||||||
Net cash provided by sale of discontinued operations and asset sales | 29.4 | 74.7 | ||||||
Net cash (used in) provided by investing activities | (89.5) | 5.6 | ||||||
Cash (used in) provided by financing activities: | ||||||||
Net increase (decrease) in credit facility borrowings | 15.2 | (57.3) | ||||||
Repayments of long-term debt | (10.1) | (70.7) | ||||||
Issuances of Common Stock | 2.4 | 1.1 | ||||||
Repurchases of Common Stock | (11.5) | (1.6) | ||||||
Payment of debt issuance costs | 0.0 | (0.2) | ||||||
Net cash used in financing activities | (4.0) | (128.7) | ||||||
Effect of exchange rate changes on cash | (2.5) | 1.5 | ||||||
Change in cash and cash equivalents of discontinued operations held for sale | 0.0 | 0.7 | ||||||
Net increase in cash and cash equivalents | 7.0 | 6.2 | ||||||
Cash and cash equivalents at beginning of period | 38.5 | 32.3 | ||||||
Cash and cash equivalents at end of period | $ | 45.5 | $ | 38.5 | ||||
Cash paid for amounts included in the measurement of lease liabilities: | ||||||||
Operating cash outflow from operating leases | $ | 30.5 | $ | 31.5 | ||||
Supplemental disclosure of non-cash investing and financing activities: | ||||||||
Right-of-use assets obtained in exchange for new operating lease liabilities | $ | 12.6 | $ | 8.6 | ||||
Supplemental disclosure of cash flow information: | ||||||||
Cash paid during the year for: | ||||||||
Interest | $ | 38.1 | $ | 50.1 | ||||
Income taxes | 23.4 | 13.4 | ||||||
Noncash investing activities: | ||||||||
Accrued capital expenditures | 7.3 | 8.9 | ||||||
UNAUDITED SEGMENT INFORMATION
The following tables set forth certain sales and operating data, net of all intersegment transactions, for the company's businesses for the periods indicated.
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(Dollars in millions) | ||||||||||||||||
Net sales: | ||||||||||||||||
Railroad and Utility Products and Services | $ | 155.6 | $ | 168.2 | $ | 729.9 | $ | 759.1 | ||||||||
Performance Chemicals | 118.9 | 129.9 | 503.3 | 526.3 | ||||||||||||
Carbon Materials and Chemicals(1) | 130.8 | 95.0 | 445.4 | 383.7 | ||||||||||||
Total | $ | 405.3 | $ | 393.1 | $ | 1,678.6 | $ | 1,669.1 | ||||||||
Adjusted EBITDA(2): | ||||||||||||||||
Railroad and Utility Products and Services | $ | 6.2 | $ | 10.3 | $ | 45.4 | $ | 65.3 | ||||||||
Performance Chemicals | 19.4 | 23.0 | 101.8 | 100.7 | ||||||||||||
Carbon Materials and Chemicals | 24.9 | 14.4 | 76.3 | 45.0 | ||||||||||||
Corporate Unallocated | (1.7) | (0.6) | 0.0 | 0.0 | ||||||||||||
Total | $ | 48.8 | $ | 47.1 | $ | 223.5 | $ | 211.0 | ||||||||
Adjusted EBITDA margin(3): | ||||||||||||||||
Railroad and Utility Products and Services | 4.0 | % | 6.1 | % | 6.2 | % | 8.6 | % | ||||||||
Performance Chemicals | 16.3 | % | 17.7 | % | 20.2 | % | 19.1 | % | ||||||||
Carbon Materials and Chemicals | 19.0 | % | 15.2 | % | 17.1 | % | 11.7 | % | ||||||||
Total | 12.0 | % | 12.0 | % | 13.3 | % | 12.6 | % | ||||||||
(1) | Net sales excludes KJCC revenue of |
(2) | The tables below describe the adjustments to arrive at adjusted EBITDA for the quarters and years ended December 31, 2021 and 2020, respectively. |
(3) | Adjusted EBITDA as a percentage of GAAP sales. |
UNAUDITED RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA | ||||||||||||||||
(In millions) | ||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net income | $ | 22.2 | $ | 18.6 | $ | 84.9 | $ | 121.0 | ||||||||
Interest expense | 10.0 | 10.3 | 40.5 | 48.9 | ||||||||||||
Depreciation and amortization | 14.3 | 14.4 | 57.7 | 54.1 | ||||||||||||
Depreciation in impairment and restructuring charges | 0.0 | 0.0 | 0.7 | 2.0 | ||||||||||||
Income tax provision | 12.1 | 6.2 | 34.5 | 21.0 | ||||||||||||
Discontinued operations | 0.3 | 0.1 | 0.2 | (31.9) | ||||||||||||
Sub-total | 58.9 | 49.6 | 218.5 | 215.1 | ||||||||||||
Adjustments to arrive at adjusted EBITDA: | ||||||||||||||||
Impairment, restructuring and plant closure (benefits) costs | (0.1) | 4.3 | 4.2 | 15.7 | ||||||||||||
(Gain) on sale of assets | (23.4) | 0.0 | (31.2) | 0.0 | ||||||||||||
LIFO expense (benefit) | 12.2 | (4.9) | 28.2 | (13.7) | ||||||||||||
Mark-to-market commodity hedging losses (gains) | 1.2 | (5.0) | 3.8 | (9.2) | ||||||||||||
Pension settlement | 0.0 | 0.1 | 0.0 | 0.1 | ||||||||||||
Discretionary incentive | 0.0 | 3.0 | 0.0 | 3.0 | ||||||||||||
Total adjustments | (10.1) | (2.5) | 5.0 | (4.1) | ||||||||||||
Adjusted EBITDA | $ | 48.8 | $ | 47.1 | $ | 223.5 | $ | 211.0 | ||||||||
UNAUDITED RECONCILIATION OF NET INCOME ATTRIBUTABLE TO KOPPERS AND ADJUSTED NET INCOME | ||||||||||||||||
(In millions) | ||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net income attributable to Koppers | $ | 22.2 | $ | 18.6 | $ | 85.2 | $ | 122.0 | ||||||||
Adjustments to arrive at adjusted net income: | ||||||||||||||||
Impairment, restructuring and plant closure (benefits) costs | (0.1) | 5.0 | 5.5 | 19.7 | ||||||||||||
(Gain) on sale of assets | (23.4) | 0.0 | (31.2) | 0.0 | ||||||||||||
LIFO expense (benefit) | 12.2 | (4.9) | 28.2 | (13.7) | ||||||||||||
Mark-to-market commodity hedging losses (gains) | 1.2 | (5.0) | 3.8 | (9.2) | ||||||||||||
Pension settlement | 0.0 | 0.1 | 0.0 | 0.1 | ||||||||||||
Discretionary incentive | 0.0 | 3.0 | 0.0 | 3.0 | ||||||||||||
Total adjustments | (10.1) | (1.8) | 6.3 | (0.1) | ||||||||||||
Adjustments to income tax and noncontrolling interests | ||||||||||||||||
Income tax on adjustments to pre-tax income | 2.5 | 0.3 | (1.4) | (0.1) | ||||||||||||
Income tax attributable to statutory tax rate changes | (1.5) | (2.2) | (1.2) | (2.1) | ||||||||||||
Deferred tax adjustments | 3.5 | 1.2 | 3.5 | 1.2 | ||||||||||||
Noncontrolling interest | 0.0 | 0.0 | (0.3) | (1.0) | ||||||||||||
Effect on adjusted net income | (5.6) | (2.5) | 6.9 | (2.1) | ||||||||||||
Adjusted net income including discontinued operations | 16.6 | 16.1 | 92.1 | 119.9 | ||||||||||||
Discontinued operations | 0.3 | 0.1 | 0.2 | (31.9) | ||||||||||||
Adjusted net income attributable to Koppers | $ | 16.9 | $ | 16.2 | $ | 92.3 | $ | 88.0 | ||||||||
UNAUDITED RECONCILIATION OF DILUTED EARNINGS PER SHARE AND ADJUSTED EARNINGS PER SHARE | ||||||||||||||||
(In millions except share amounts) | ||||||||||||||||
Three Months Ended December 31, | Year Ended December 31, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Income from continuing operations attributable to Koppers | $ | 22.2 | $ | 18.8 | $ | 85.4 | $ | 89.1 | ||||||||
Net income attributable to Koppers | $ | 22.2 | $ | 18.6 | $ | 85.2 | $ | 122.0 | ||||||||
Adjusted net income attributable to Koppers | $ | 16.9 | $ | 16.2 | $ | 92.3 | $ | 88.0 | ||||||||
Denominator for diluted earnings per share (in thousands) | 21,917 | 21,621 | 21,925 | 21,374 | ||||||||||||
Earnings per share: | ||||||||||||||||
Diluted earnings per share - continuing operations | $ | 1.02 | $ | 0.86 | $ | 3.90 | $ | 4.17 | ||||||||
Diluted earnings per share - net income | $ | 1.01 | $ | 0.86 | $ | 3.88 | $ | 5.71 | ||||||||
Adjusted earnings per share | $ | 0.77 | $ | 0.75 | $ | 4.21 | $ | 4.12 | ||||||||
UNAUDITED RECONCILIATION OF TOTAL DEBT TO NET DEBT AND NET LEVERAGE RATIO | ||||||||
(In millions) | ||||||||
Year Ended December 31, | ||||||||
2021 |
2020 | |||||||
Total Debt | $ | 783.5 | $ | 775.9 | ||||
Less: Cash | 45.5 | 38.5 | ||||||
Net Debt | $ | 738.0 | $ | 737.4 | ||||
Adjusted EBITDA | $ | 223.5 | $ | 211.0 | ||||
Net Leverage Ratio | 3.3 | 3.5 | ||||||
For Information: | Quynh McGuire, Vice President, Investor Relations | |
412 227 2049 | ||
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SOURCE Koppers
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