Synalloy Reports Fourth Quarter and Full Year 2020 Results
Synalloy Corporation (Nasdaq: SYNL) reported its fourth quarter and full-year financial results for 2020. Q4 net sales stood at $55.9M, down from $67.9M in Q4 2019, primarily due to curtailments in operations. A net loss of $8.6M was reported, significantly higher than the $0.9M loss in the same quarter last year. Adjusted EBITDA increased to $3.0M, reflecting operational efficiencies. For the full year, net sales were $256.0M, down from $305.2M in 2019, with a total net loss of $27.3M. Debt was reduced by $14.2M by year-end.
- Adjusted EBITDA for Q4 2020 increased to $3.0 million, up 19% from Q4 2019.
- Improvement in gross profit margin to 11.0% due to operational efficiencies.
- Net sales decreased by 17.6% in Q4 2020 compared to Q4 2019.
- Reported a significant net loss of $8.6 million in Q4 2020 compared to $0.9 million in Q4 2019.
- Full year 2020 net loss increased to $27.3 million from $3.0 million in 2019 due to goodwill impairments.
Synalloy Corporation (Nasdaq: SYNL) (“Synalloy” or the “Company”), an industrials company focused on the production and distribution of piping, tubing and specialty chemicals, is reporting its results for the fourth quarter and full year ended December 31, 2020.
Fourth Quarter 2020 Summary
(in millions, expect per share and margin) |
Q4 2020 |
Q3 2020 |
Q4 2019 |
Net Sales |
|
|
|
Gross Profit |
|
|
|
Gross Profit Margin |
|
|
|
Net Loss |
|
|
|
Net Loss per share |
|
|
|
Adjusted EBITDA |
|
|
|
Adjusted EBITDA Margin |
|
|
|
Management Commentary
“While 2020 had its challenges, I’m proud of how our dedicated employees have persisted through this unique time and continued to deliver high-quality products and services to our customers,” said Chris Hutter, interim president and CEO of Synalloy. “As expected, net sales were impacted during the fourth quarter as our customers continued to be affected by macro-economic conditions resulting from COVID-19, however, we were able to take proactive steps to enhance our production and purchasing efficiency resulting in materially improved profitability across our businesses.
“Since taking the helm as interim CEO just a few months ago, the management team and board of directors have been developing and fine tuning our go-forward strategic priorities that we believe will deliver long-term shareholder value creation. During this period, we’ve enjoyed productive dialogue with our employee base and customers, who see tremendous value in the high-quality products and services we offer in both our metals and chemicals segments. We also expect to continue investing in all elements of our culture to foster accountability and transparency. This will enable us to better leverage the diverse experiences and relationships that can create a renewed sense of alignment throughout our organization. Although we still have much to do, we are moving in the right direction and look forward to providing value-added solutions to our customers while also improving profitability and returning the Company to growth.”
Fourth Quarter 2020 Financial Results
Net sales were
Gross profit was
Net loss was
Adjusted EBITDA increased
Full Year 2020 Financial Results
Net sales were
Gross profit was
Net loss was
Adjusted EBITDA was
Segment Results
Metals – net sales in the fourth quarter of 2020 were
Net sales in 2020 were
Specialty Chemicals – net sales in the fourth quarter of 2020 were
Net sales in 2020 were
Liquidity
As of December 31, 2020, total debt was
On January 15, 2021, the Company and its subsidiaries entered into an agreement for a new revolving credit facility with BMO Harris Bank N.A. The new agreement provides the Company with a four-year revolving credit facility that includes up to
Conference Call
Synalloy will conduct a conference call today at 5:00 p.m. Eastern time to discuss its results for the fourth quarter and full year ended December 31, 2020.
Synalloy management will host the conference call, followed by a question-and-answer period.
Date: Tuesday, March 9, 2021
Time: 5:00 p.m. Eastern time
Toll-free dial-in number: 1-877-303-6648
International dial-in number: 1-970-315-0443
Conference ID: 4387292
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Investor Relations at 1-949-574-3860.
The conference call will be broadcast live and available for replay here and via the investor relations section of the company’s website at www.synalloy.com.
About Synalloy Corporation
Synalloy Corporation (Nasdaq: SYNL) is a company that engages in a number of diverse business activities including the production of stainless steel and galvanized pipe and tube, the master distribution of seamless carbon pipe and tube, and the production of specialty chemicals. For more information about Synalloy Corporation, please visit its web site at www.synalloy.com.
Forward-Looking Statements
This earnings release includes and incorporates by reference "forward-looking statements" within the meaning of the federal securities laws. All statements that are not historical facts are forward-looking statements. The words "estimate," "project," "intend," "expect," "believe," "should," "anticipate," "hope," "optimistic," "plan," "outlook," "should," "could," "may" and similar expressions identify forward-looking statements. The forward-looking statements are subject to certain risks and uncertainties, including without limitation those identified below, which could cause actual results to differ materially from historical results or those anticipated. Readers are cautioned not to place undue reliance on these forward-looking statements. The following factors could cause actual results to differ materially from historical results or those anticipated: adverse economic conditions, including risks relating to the impact and spread of and the government’s response to COVID-19; inability to weather an economic downturn; a prolonged decrease in nickel and oil prices; the impact of competitive products and pricing; product demand and acceptance risks; raw material and other increased costs; raw materials availability; financial stability of the Company’s customers; customer delays or difficulties in the production of products; loss of consumer or investor confidence; employee relations; ability to maintain workforce by hiring trained employees; labor efficiencies; risks associated with mergers, acquisitions, dispositions and other expansion activities; environmental issues; negative or unexpected results from tax law changes; inability to comply with covenants and ratios required by the Company’s debt financing arrangements; and other risks detailed from time-to-time in Synalloy Corporation's Securities and Exchange Commission filings. Synalloy Corporation assumes no obligation to update any forward-looking information included in this release.
Non-GAAP Financial Information
Financial statement information included in this earnings release includes non-GAAP (Generally Accepted Accounting Principles) measures and should be read along with the accompanying tables which provide a reconciliation of non-GAAP measures to GAAP measures.
Adjusted EBITDA is a non-GAAP measure and excludes goodwill impairment, asset impairment, gain on lease modification, interest expense (including change in fair value of interest rate swap), income taxes, depreciation, amortization, stock-based compensation, non-cash lease cost, acquisition costs and other fees, proxy contest costs, shelf registration costs, earn-out adjustments, gains on investments in equity securities, retention costs and restructuring & severance costs from net income.
Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) per Share are non-GAAP measures and exclude goodwill impairment, asset impairment, gain on lease modification, stock-based compensation, non-cash lease costs, acquisition costs and other fees, proxy contest costs, shelf registration costs, earn-out adjustments, gains on investments in equity securities, retention costs and restructuring & severance costs from net income. They also utilize a constant effective tax rate to reflect tax neutral results.
Management believes that these non-GAAP measures provide additional useful information to allow readers to compare the financial results between periods. Non-GAAP measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the Company's performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the Company's results or financial condition as reported under GAAP.
Condensed Consolidated Balance Sheets |
||||||||
($ in thousands) |
December 31, 2020 |
|
December 31, 2019 |
|||||
Assets |
|
|
|
|||||
Cash |
$ |
236 |
|
|
$ |
626 |
|
|
Accounts receivable, net of allowance for credit losses of |
28,183 |
|
|
35,074 |
|
|||
Inventories, net |
85,080 |
|
|
98,186 |
|
|||
Prepaid expenses and other current assets |
13,384 |
|
|
13,229 |
|
|||
Total current assets |
126,883 |
|
|
147,115 |
|
|||
|
|
|
|
|||||
Property, plant and equipment, net |
35,096 |
|
|
40,690 |
|
|||
Right-of-use assets, operating leases, net |
31,769 |
|
|
35,772 |
|
|||
Goodwill |
1,355 |
|
|
17,558 |
|
|||
Intangible assets, net |
11,426 |
|
|
15,714 |
|
|||
Deferred charges, net |
455 |
|
|
348 |
|
|||
Total assets |
$ |
206,984 |
|
|
$ |
257,197 |
|
|
|
|
|
|
|||||
Liabilities and Shareholders' Equity |
|
|
|
|||||
Accounts payable |
$ |
19,732 |
|
|
$ |
21,150 |
|
|
Accrued expenses and other current liabilities |
6,123 |
|
|
6,037 |
|
|||
Current portion of long-term debt |
875 |
|
|
4,000 |
|
|||
Current portion of earn-out liability |
3,434 |
|
|
5,576 |
|
|||
Current portion operating lease liabilities |
867 |
|
|
3,562 |
|
|||
Current portion of finance lease liabilities |
19 |
|
|
253 |
|
|||
Total current liabilities |
31,050 |
|
|
40,578 |
|
|||
|
|
|
|
|||||
Long-term debt |
60,495 |
|
|
71,554 |
|
|||
Long-term portion of earn-out liability |
287 |
|
|
3,578 |
|
|||
Long-term portion of operating lease liabilities |
32,771 |
|
|
33,723 |
|
|||
Long-term portion of finance lease liabilities |
37 |
|
|
336 |
|
|||
Deferred income taxes |
1,957 |
|
|
790 |
|
|||
Other long-term liabilities |
92 |
|
|
127 |
|
|||
Shareholders' equity |
80,296 |
|
|
106,511 |
|
|||
Total liabilities and shareholders' equity |
$ |
206,984 |
|
|
$ |
257,197 |
|
|
Note: The condensed consolidated balance sheet at December 31, 2019 has been derived from the audited consolidated financial statements at that date.
Synalloy Corporation Comparative Analysis |
||||||||||||||||
Condensed Consolidated Statement of Operations |
||||||||||||||||
|
||||||||||||||||
(Amounts in thousands, except per share data) |
Three Months Ended
|
|
Year Ended
|
|||||||||||||
(unaudited) |
2020 |
|
2019 |
|
2020 |
|
2019 |
|||||||||
Net sales |
|
|
|
|
|
|
|
|||||||||
Metals Segment |
44,698 |
|
|
55,351 |
|
|
204,459 |
|
|
251,078 |
|
|||||
Specialty Chemicals Segment |
11,203 |
|
|
12,596 |
|
|
51,541 |
|
|
54,090 |
|
|||||
|
$ |
55,901 |
|
|
$ |
67,947 |
|
|
$ |
256,000 |
|
|
$ |
305,168 |
|
|
Operating (loss) income |
|
|
|
|
|
|
||||||||||
Metals Segment |
(4,815 |
) |
|
613 |
|
|
(24,599 |
) |
|
3,692 |
|
|||||
Specialty Chemicals Segment |
525 |
|
|
424 |
|
|
4,033 |
|
|
2,811 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Unallocated expense (income) |
|
|
|
|
|
|
|
|||||||||
Corporate |
2,784 |
|
|
1,780 |
|
|
7,917 |
|
|
8,357 |
|
|||||
Acquisition costs and other |
42 |
|
|
164 |
|
|
845 |
|
|
601 |
|
|||||
Proxy contest costs |
— |
|
|
— |
|
|
3,105 |
|
|
— |
|
|||||
Earn-out adjustments |
(226 |
) |
|
896 |
|
|
(1,195 |
) |
|
(747 |
) |
|||||
Gain on lease modification |
— |
|
|
— |
|
|
(171 |
) |
|
— |
|
|||||
Operating loss |
(6,890 |
) |
|
(1,803 |
) |
|
(31,067 |
) |
|
(1,708 |
) |
|||||
Interest expense |
406 |
|
|
840 |
|
|
2,110 |
|
|
3,818 |
|
|||||
Change in fair value of interest rate swap |
(14 |
) |
|
(4 |
) |
|
51 |
|
|
141 |
|
|||||
Other (income) expense, net |
(10 |
) |
|
(1,680 |
) |
|
(1,255 |
) |
|
(1,904 |
) |
|||||
Net loss before income taxes |
(7,272 |
) |
|
(959 |
) |
|
(31,973 |
) |
|
(3,763 |
) |
|||||
Income tax provision (benefit) |
1,320 |
|
|
(66 |
) |
|
(4,706 |
) |
|
(727 |
) |
|||||
|
|
|
|
|
|
|
|
|||||||||
Net loss |
$ |
(8,592 |
) |
|
$ |
(893 |
) |
|
$ |
(27,267 |
) |
|
$ |
(3,036 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Net loss per common share |
|
|
|
|
|
|
|
|||||||||
Basic |
$ |
(0.94 |
) |
|
$ |
(0.10 |
) |
|
$ |
(3.00 |
) |
|
$ |
(0.34 |
) |
|
Diluted |
$ |
(0.94 |
) |
|
$ |
(0.10 |
) |
|
$ |
(3.00 |
) |
|
$ |
(0.34 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Average shares outstanding |
|
|
|
|
|
|
|
|||||||||
Basic |
9,156 |
|
|
9,026 |
|
|
9,099 |
|
|
8,983 |
|
|||||
Diluted |
9,156 |
|
|
9,026 |
|
|
9,099 |
|
|
8,983 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Other data: |
|
|
|
|
|
|
|
|||||||||
Adjusted EBITDA (1) |
3,017 |
|
|
2,527 |
|
|
9,247 |
|
|
13,460 |
|
|||||
(1) The term Adjusted EBITDA is a non-GAAP financial measure that the Company believes is useful to investors in evaluating its results to determine the value of a company. An item is included in the measure if its periodic value is inconsistent and sufficiently material that not identifying the item would render period comparability less meaningful to the reader or if including the item provides a clearer representation of normalized periodic earnings. The Company includes in Adjusted EBITDA two categories of items: 1) Base EBITDA components, including: earnings before discontinued operations, interest (including change in fair value of interest rate swap), income taxes, depreciation and amortization, and 2) Material transaction costs including: goodwill impairment, asset impairment, gain on lease modification, acquisition costs and other fees, proxy contest costs, shelf registration costs, earn-out adjustments, gain on excess death benefit, realized and unrealized (gains) and losses on investments in equity securities, casualty insurance gains, all (gains) losses associated with sale-leaseback, stock option/grant costs, non-cash lease cost, retention costs and restructuring & severance costs from net income. For a reconciliation of this non-GAAP measure to the most comparable GAAP equivalent, refer to the Reconciliation of Net Income (Loss) to Adjusted EBITDA.
Consolidated Statement of Cash Flows |
||||||||
For the years ended December 31, 2020 and 2019 |
||||||||
(in thousands) |
2020 |
|
2019 |
|||||
Operating activities |
|
|
|
|||||
Net loss |
$ |
(27,267 |
) |
|
$ |
(3,036 |
) |
|
Adjustments to reconcile net loss to net cash provided by operating activities: |
|
|
|
|||||
Depreciation expense |
7,572 |
|
|
7,578 |
|
|||
Amortization expense |
3,028 |
|
|
3,486 |
|
|||
Amortization of debt issuance costs |
177 |
|
|
160 |
|
|||
Asset impairments |
6,214 |
|
|
— |
|
|||
Goodwill impairment |
16,203 |
|
|
— |
|
|||
Unrealized gain on equity securities |
(208 |
) |
|
(1,547 |
) |
|||
Deferred income taxes |
1,167 |
|
|
(773 |
) |
|||
Proceeds from business interruption insurance |
1,040 |
|
|
— |
|
|||
Loss (gain) on sale of equity securities |
38 |
|
|
(326 |
) |
|||
Earn-out adjustments |
(1,195 |
) |
|
(747 |
) |
|||
Payments of earn-out liabilities in excess of acquisition date fair value |
(292 |
) |
|
(448 |
) |
|||
Provision for (reduction of) losses on accounts receivable |
890 |
|
|
(171 |
) |
|||
Provision for losses on inventories |
271 |
|
|
1,617 |
|
|||
Loss (gain) on sale of property, plant and equipment |
237 |
|
|
(50 |
) |
|||
Non-cash lease expense |
510 |
|
|
560 |
|
|||
Non-cash lease termination loss |
24 |
|
|
— |
|
|||
Gain on lease modification |
(171 |
) |
|
— |
|
|||
Change in fair value of interest rate swap |
51 |
|
|
(141 |
) |
|||
Issuance of treasury stock for director fees |
345 |
|
|
304 |
|
|||
Stock-based compensation expense |
1,791 |
|
|
2,091 |
|
|||
Changes in operating assets and liabilities: |
|
|
|
|||||
Accounts receivable |
5,552 |
|
|
9,696 |
|
|||
Inventories |
9,122 |
|
|
19,962 |
|
|||
Other assets and liabilities |
(912 |
) |
|
179 |
|
|||
Accounts payable |
(1,418 |
) |
|
(5,323 |
) |
|||
Accrued expenses |
86 |
|
|
(3,317 |
) |
|||
Accrued income taxes |
(4,877 |
) |
|
(1,114 |
) |
|||
Net cash provided by operating activities |
17,978 |
|
|
28,640 |
|
|||
Investing activities |
|
|
|
|||||
Purchases of property, plant and equipment |
(3,748 |
) |
|
(4,537 |
) |
|||
Proceeds from sale of property, plant and equipment |
312 |
|
|
189 |
|
|||
Purchases of equity securities |
— |
|
|
(544 |
) |
|||
Proceeds from sale of equity securities |
4,430 |
|
|
1,092 |
|
|||
Acquisitions |
— |
|
|
(21,895 |
) |
|||
Net cash provided by (used in) investing activities |
994 |
|
|
(25,695 |
) |
|||
Financing activities |
|
|
|
|||||
Repayments on line of credit |
(10,184 |
) |
|
(17,185 |
) |
|||
Borrowings from term loan |
— |
|
|
20,000 |
|
|||
Payments on long-term debt |
(4,000 |
) |
|
(3,666 |
) |
|||
Principal payments on finance lease obligations |
(109 |
) |
|
(106 |
) |
|||
Payments for finance lease terminations |
(204 |
) |
|
— |
|
|||
Payments on earn-out liabilities |
(3,946 |
) |
|
(3,627 |
) |
|||
Payments of debt issuance costs |
(284 |
) |
|
— |
|
|||
Proceeds from exercised stock options |
— |
|
|
45 |
|
|||
Repurchase of common stock |
(635 |
) |
|
— |
|
|||
Net cash used in financing activities |
(19,362 |
) |
|
(4,539 |
) |
|||
Decrease in cash and cash equivalents |
(390 |
) |
|
(1,594 |
) |
|||
Cash and cash equivalents at beginning of year |
626 |
|
|
2,220 |
|
|||
Cash and cash equivalents at end of year |
$ |
236 |
|
|
$ |
626 |
|
|
Reconciliation of Net Income (Loss) to Adjusted EBITDA |
||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||
($ in thousands) |
Three Months Ended
|
|
Year Ended
|
|||||||||||||
(unaudited) |
2020 |
|
2019 |
|
2020 |
|
2019 |
|||||||||
Consolidated |
|
|
|
|
|
|
|
|||||||||
Net loss |
$ |
(8,592 |
) |
|
$ |
(893 |
) |
|
$ |
(27,267 |
) |
|
$ |
(3,036 |
) |
|
Adjustments: |
|
|
|
|
|
|
|
|||||||||
Interest expense |
406 |
|
|
840 |
|
|
2,110 |
|
|
3,818 |
|
|||||
Change in fair value of interest rate swap |
(14 |
) |
|
(4 |
) |
|
51 |
|
|
141 |
|
|||||
Income taxes |
1,320 |
|
|
(66 |
) |
|
(4,706 |
) |
|
(727 |
) |
|||||
Depreciation |
1,820 |
|
|
1,888 |
|
|
7,572 |
|
|
7,578 |
|
|||||
Amortization |
705 |
|
|
871 |
|
|
3,028 |
|
|
3,486 |
|
|||||
EBITDA |
(4,355 |
) |
|
2,636 |
|
|
(19,212 |
) |
|
11,260 |
|
|||||
Acquisition costs and other |
53 |
|
|
174 |
|
|
861 |
|
|
1,936 |
|
|||||
Proxy contest costs |
— |
|
|
— |
|
|
3,105 |
|
|
— |
|
|||||
Shelf registration costs |
— |
|
|
— |
|
|
— |
|
|
10 |
|
|||||
Earn-out adjustments |
(226 |
) |
|
896 |
|
|
(1,195 |
) |
|
(747 |
) |
|||||
Gain on investments in equity securities |
— |
|
|
(1,680 |
) |
|
(170 |
) |
|
(1,873 |
) |
|||||
Asset impairments |
135 |
|
|
— |
|
|
6,214 |
|
|
— |
|
|||||
Goodwill impairment |
5,455 |
|
|
— |
|
|
16,203 |
|
|
— |
|
|||||
Gain on lease modification |
— |
|
|
— |
|
|
(171 |
) |
|
— |
|
|||||
Stock-based compensation |
755 |
|
|
331 |
|
|
1,791 |
|
|
2,091 |
|
|||||
Non-cash lease expense |
124 |
|
|
128 |
|
|
510 |
|
|
560 |
|
|||||
Retention expense |
— |
|
|
42 |
|
|
235 |
|
|
223 |
|
|||||
Restructuring and severance costs |
1,076 |
|
|
— |
|
|
1,076 |
|
|
— |
|
|||||
Adjusted EBITDA |
$ |
3,017 |
|
|
$ |
2,527 |
|
|
$ |
9,247 |
|
|
$ |
13,460 |
|
|
% sales |
5.4 |
% |
|
3.7 |
% |
|
3.6 |
% |
|
4.4 |
% |
|||||
|
|
|
|
|
|
|
|
|||||||||
Metals Segment |
|
|
|
|
|
|
|
|||||||||
Net income (loss) |
$ |
(4,590 |
) |
|
$ |
(302 |
) |
|
$ |
(22,388 |
) |
|
$ |
4,356 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|||||||||
Interest expense |
— |
|
|
19 |
|
|
11 |
|
|
83 |
|
|||||
Depreciation expense |
1,398 |
|
|
1,478 |
|
|
5,855 |
|
|
5,954 |
|
|||||
Amortization expense |
705 |
|
|
871 |
|
|
3,028 |
|
|
3,486 |
|
|||||
EBITDA |
(2,487 |
) |
|
2,066 |
|
|
(13,494 |
) |
|
13,879 |
|
|||||
Acquisition costs and other |
13 |
|
|
10 |
|
|
16 |
|
|
1,381 |
|
|||||
Earn-out adjustments |
(226 |
) |
|
896 |
|
|
(1,195 |
) |
|
(747 |
) |
|||||
Asset impairments |
135 |
|
|
— |
|
|
6,214 |
|
|
— |
|
|||||
Goodwill impairment |
5,455 |
|
|
— |
|
|
16,203 |
|
|
— |
|
|||||
Stock-based compensation |
54 |
|
|
258 |
|
|
303 |
|
|
663 |
|
|||||
Retention expense |
— |
|
|
17 |
|
|
— |
|
|
123 |
|
|||||
Metals Segment Adjusted EBITDA |
$ |
2,944 |
|
|
$ |
3,247 |
|
|
$ |
8,047 |
|
|
$ |
15,299 |
|
|
% segment sales |
6.6 |
% |
|
5.9 |
% |
|
3.9 |
% |
|
6.1 |
% |
|||||
|
|
|
|
|
|
|
|
|||||||||
Specialty Chemicals Segment |
|
|
|
|
|
|
|
|||||||||
Net income |
$ |
525 |
|
|
$ |
424 |
|
|
$ |
4,046 |
|
|
$ |
2,811 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|||||||||
Interest expense |
— |
|
|
— |
|
|
9 |
|
|
— |
|
|||||
Depreciation expense |
381 |
|
|
367 |
|
|
1,552 |
|
|
1,461 |
|
|||||
EBITDA |
906 |
|
|
791 |
|
|
5,607 |
|
|
4,272 |
|
|||||
Stock-based compensation |
29 |
|
|
22 |
|
|
207 |
|
|
226 |
|
|||||
Specialty Chemicals Segment Adjusted EBITDA |
$ |
935 |
|
|
$ |
813 |
|
|
$ |
5,814 |
|
|
$ |
4,498 |
|
|
% segment sales |
8.4 |
% |
|
6.5 |
% |
|
11.3 |
% |
|
8.3 |
% |
|||||
Reconciliation of Income (Loss) and Earnings (Loss) Per Share to
|
||||||||||||||||
(Amounts in thousands, except per share data) |
Three Months Ended
|
|
Year Ended
|
|||||||||||||
(unaudited) |
2020 |
|
2019 |
|
2020 |
|
2019 |
|||||||||
|
|
|
|
|
|
|
|
|||||||||
Loss before taxes |
$ |
(7,272 |
) |
|
$ |
(960 |
) |
|
$ |
(31,973 |
) |
|
$ |
(3,763 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Adjustments: |
|
|
|
|
|
|
|
|||||||||
Acquisition costs and other |
54 |
|
|
174 |
|
|
861 |
|
|
1,936 |
|
|||||
Proxy contest costs |
— |
|
|
— |
|
|
3,105 |
|
|
— |
|
|||||
Shelf registration costs |
— |
|
|
— |
|
|
— |
|
|
10 |
|
|||||
Earn-out adjustments |
(226 |
) |
|
896 |
|
|
(1,195 |
) |
|
(747 |
) |
|||||
Gain on investments in equity securities |
— |
|
|
(1,680 |
) |
|
(170 |
) |
|
(1,873 |
) |
|||||
Asset impairments |
135 |
|
|
— |
|
|
6,214 |
|
|
— |
|
|||||
Goodwill impairment |
5,455 |
|
|
— |
|
|
16,203 |
|
|
— |
|
|||||
Gain on lease modification |
— |
|
|
— |
|
|
(171 |
) |
|
— |
|
|||||
Stock-based compensation |
755 |
|
|
331 |
|
|
1,791 |
|
|
2,091 |
|
|||||
Non-cash lease expense |
124 |
|
|
128 |
|
|
510 |
|
|
560 |
|
|||||
Retention expense |
— |
|
|
42 |
|
|
235 |
|
|
223 |
|
|||||
Restructuring and severance costs |
1,076 |
|
|
— |
|
|
1,076 |
|
|
— |
|
|||||
Adjusted income (loss) before income taxes |
101 |
|
|
(1,069 |
) |
|
(3,514 |
) |
|
(1,563 |
) |
|||||
(Benefit) for income taxes at |
21 |
|
|
(224 |
) |
|
(738 |
) |
|
(328 |
) |
|||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted net income (loss) |
$ |
80 |
|
|
$ |
(845 |
) |
|
$ |
(2,776 |
) |
|
$ |
(1,235 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Average shares outstanding, as reported |
|
|
|
|
|
|
|
|||||||||
Basic |
9,156 |
|
|
9,026 |
|
|
9,099 |
|
|
8,983 |
|
|||||
Diluted |
9,156 |
|
|
9,026 |
|
|
9,099 |
|
|
8,983 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Adjusted net income (loss) per common share |
|
|
|
|
|
|
|
|||||||||
Basic |
$ |
0.01 |
|
|
$ |
(0.09 |
) |
|
$ |
(0.31 |
) |
|
$ |
(0.14 |
) |
|
Diluted |
$ |
0.01 |
|
|
$ |
(0.09 |
) |
|
$ |
(0.31 |
) |
|
$ |
(0.14 |
) |
|
|
|
|
|
|
|
|
|
|||||||||
Other (unfavorable) favorable impacts to income (1): |
|
|
|
|
|
|
||||||||||
Inventory price change loss |
$ |
189 |
|
|
$ |
(629 |
) |
|
$ |
(5,301 |
) |
|
$ |
(6,359 |
) |
|
Inventory cost adjustment |
(49 |
) |
|
11 |
|
|
119 |
|
|
88 |
|
|||||
Aged inventory adjustment |
(13 |
) |
|
52 |
|
|
107 |
|
|
7 |
|
|||||
|
|
|
|
|
|
|
|
|||||||||
Total other (unfavorable) favorable impacts |
$ |
127 |
|
|
$ |
(566 |
) |
|
$ |
(5,075 |
) |
|
$ |
(6,264 |
) |
|
Other impacts, net of tax |
$ |
100 |
|
|
$ |
(447 |
) |
|
$ |
(4,009 |
) |
|
$ |
(4,949 |
) |
|
(1) Other (unfavorable) impacts to income - listed to provide investors with insight into financial impacts, that cannot be included in the Non-GAAP measure Adjusted Net Income, but management believes can provide insight into underlying operational earnings associated with the respective period's activity level. The items include a) inventory price change - the calculated value that profits improved (declined) due to the increase (decrease) in metal and alloy pricing indices during the period, and b) inventory valuation adjustments - value of periodic adjustment to inventory carrying value unrelated to periodic earnings including i) reserve for lower of cost or net realizable value and ii) reserve for aged inventory.
View source version on businesswire.com: https://www.businesswire.com/news/home/20210309005999/en/
FAQ
What were Synalloy Corporation's Q4 2020 financial results?
How did Synalloy's full year 2020 performance compare to 2019?
What impact did curtailments have on Synalloy's sales?
What is the status of Synalloy's debt as of December 31, 2020?
What financial indicators showed improvement for Synalloy in Q4 2020?
