Press Release Details

A Record Year of Profitability for the Company

737 MAX Production Pause Tempers 2020 Outlook

ROCHESTER, N.H.--(BUSINESS WIRE)--Feb. 10, 2020-- Albany International Corp. (NYSE:AIN) today reported operating results for its fourth quarter of 2019, which ended December 31, 2019.

“Albany finished 2019 with another quarter of strong results thanks to excellent performance and execution in both business segments,” said Albany International President and Chief Executive Officer Bill Higgins. “I thank our employees across the globe for their contribution to the growth and success of the company during 2019.”

“Our 2019 performance clearly demonstrates that the strategy we’ve pursued for many years is working. We continue to drive improvements in Machine Clothing with superb results, and although the Boeing 737 MAX delay slows our growth in Engineered Composites, we believe the long-term opportunity for advanced composites is exciting. We plan to continue investing to advance our technology leadership and to exploit 3D woven technology in new applications to grow the company.”

For the fourth quarter ended December 31, 2019:

• Net sales were $257.7 million, an increase of 2.4% compared to the prior year, driven by solid sales growth of 6.1% in Engineered Composites and stable sales in the Machine Clothing segment.
• Gross profit of $96.6 million was up from $87.9 million for the same period of 2018, an increase of 9.9%. The increase was driven by an increase in total company net sales and by gross margin expansion in both segments.
• Operating income was $43.6 million, compared to $37.4 million in the prior year, an increase of 16.5%, driven by higher gross profit offset somewhat by higher STG&R expenses. These expenses increased as the result of the revaluation of nonfunctional-currency assets and liabilities, and expenses related to the acquisition of CirComp GmbH.
• The effective tax rate was 24.8%, compared to 37.9% during the same period last year. The effective tax rates include discrete tax items and a change in the estimated income tax rate which reduced fourth-quarter Income tax expense by $1.3 million in 2019, while the same factors increased the expense by $1.8 million in the same quarter of 2018.
• Net income attributable to the Company was $29.1 million ($0.90 per share), compared to $17.6 million ($0.55 per share) in Q4 2018. Adjusted earnings per share (or Adjusted EPS, a non-GAAP measure) was $0.97 per share, compared to $0.69 per share in Q4 2018.
• Adjusted EBITDA (a non-GAAP measure) was $63.9 million, compared to $57.7 million in Q4 2018, an increase of 10.8%.

For the year ended December 31, 2019:

• Net sales were $1,054.1 million, an increase of 7.3% compared to the prior year’s $982.5 million, driven by solid sales growth of 22.2% in Engineered Composites offset somewhat by a 1.7% sales decline in the Machine Clothing segment.
• Gross profit of $397.7 million was up from $349.7 million for the same period of 2018, an increase of 13.7%. The increase was driven by higher net sales in Engineered Composites and by gross margin expansion in both segments.
• Operating income was $193.6 million, compared to $137.4 million in the prior year. The increase was driven by higher gross profit and lower Restructuring expenses in 2019 offset somewhat by higher STG&R expenses.
• The effective tax rate was 25.2%, compared to 28.0% during the same period last year. The effective tax rates include discrete tax items and finalization of the 2019 income tax rate which reduced 2019 Income tax expense by $5.0 million, while the same factors decreased the 2018 expense by $3.8 million.
• Net income attributable to the Company was $132.4 million ($4.10 per share), compared to $82.9 million ($2.57 per share) in 2018. Adjusted earnings per share (or Adjusted EPS, a non-GAAP measure) was $4.11 per share in 2019, compared to $2.94 per share in 2018.
• Adjusted EBITDA (a non-GAAP measure) was $265.4 million, compared to $228.9 million in Q4 2018, an increase of 15.9%.

Please see the tables below for a reconciliation of non-GAAP measures to their comparable GAAP measures.

“As our guidance indicates, we are expecting another strong year for Albany. We enter 2020 in excellent financial health with strong operations focused on expanding profitability and the long-term growth of our business segments,” said Albany International Chief Financial Officer and Treasurer Stephen Nolan. “Our Machine Clothing segment is expected to deliver another good year and to continue to deliver strong margins consistent with the expectation set on our last earnings call. Our guidance for the segment takes into account a slightly softer paper machine clothing market in 2020 and a modest impact due to the disruption to our Chinese facilities caused by the recent coronavirus outbreak. Meanwhile, our Engineered Composites segment is expected to continue to deliver strong margins and sales growth on programs unrelated to the 737 MAX. That said, our business will inevitably be impacted by Boeing’s production pause on the 737 MAX program. Our outlook for 2020 takes into account a reduction in demand for the components we produce for the LEAP engine that powers the 737 MAX aircraft. We will make any further necessary adjustments to our plans and outlook as we gain clarity on the expected timing and pace of demand for those components after Boeing resumes 737 MAX production.”

Outlook for Full-Year 2020

Albany International is issuing its financial guidance for the full-year 2020:

• Machine Clothing revenue of $570 to $590 million;
• Machine Clothing Adjusted EBITDA of between $190 and $200 million;
• Engineered Composites revenue between $400 to $420 million;
• Engineered Composites Adjusted EBITDA of $80 to $90 million;
• Total company revenue of between $970 million and $1.010 billion;
• Total company Adjusted EBITDA of $210 to $235 million;
• Effective income tax rate of 26% to 28%;
• Total company depreciation and amortization of between $75 and $80 million;
• Capital expenditures in the range of $75 to $85 million;
• GAAP Earnings per share of between $2.68 and $3.08; and
• Adjusted earnings per share between $2.75 and $3.15.

ALBANY INTERNATIONAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
(unaudited)
Three Months Ended							Years ended
December 31,							December 31,
2019		2018					2019			2018
$257,678		$251,613			Net sales		$1,054,132			$982,479
161,037		163,691			Cost of goods sold		656,431			632,730
96,641		87,922			Gross profit		397,701			349,749
42,049		38,543			Selling, general, and administrative expenses		163,651			156,189
9,246		10,109			Technical and research expenses		37,569			40,582
1,766		1,856			Restructuring expenses, net		2,905			15,570
43,580		37,414			Operating income		193,576			137,408
3,886		4,594			Interest expense, net		16,921			18,124
349		5,010			Other (income)/expense, net		(1,557	)		4,037
39,345		27,810			Income before income taxes		178,212			115,247
9,754		10,538			Income tax expense		44,829			32,228
29,591		17,272			Net income		133,383			83,019
446		(319	)		Net income/(loss) attributable to the noncontrolling interest		985			128
$29,145		$17,591			Net income attributable to the Company		$132,398			$82,891
$0.90		$0.55			Earnings per share attributable to Company shareholders - Basic		$4.10			$2.57
$0.90		$0.54			Earnings per share attributable to Company shareholders - Diluted		$4.10			$2.57
					Shares of the Company used in computing earnings per share:
32,308		32,266			Basic		32,296			32,252
32,317		32,279			Diluted		32,308			32,267
$0.19		$0.18			Dividends declared per share, Class A and Class B		$0.73			$0.69

ALBANY INTERNATIONAL CORP.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
(unaudited)
		December 31,			December 31,
		2019			2018
ASSETS
Cash and cash equivalents		$195,540			$197,755
Accounts receivable, net		218,271			223,176
Contract assets		79,070			57,447
Inventories		95,149			85,904
Income taxes prepaid and receivable		6,162			7,473
Prepaid expenses and other current assets		24,142			21,294
Total current assets		$618,334			$593,049
Property, plant and equipment, net		466,462			462,055
Intangibles, net		52,892			49,206
Goodwill		180,934			164,382
Deferred income taxes		51,621			62,622
Noncurrent receivables		41,234			45,061
Other assets		62,891			41,617
Total assets		$1,474,368			$1,417,992
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable		$65,203			$52,246
Accrued liabilities		125,885			129,030
Current maturities of long-term debt		20			1,224
Income taxes payable		11,611			6,806
Total current liabilities		202,719			189,306
Long-term debt		424,009			523,707
Other noncurrent liabilities		132,725			88,277
Deferred taxes and other liabilities		12,226			8,422
Total liabilities		771,679			809,712
SHAREHOLDERS' EQUITY
Preferred stock, par value $5.00 per share; authorized 2,000,000 shares; none issued		-			-
Class A Common Stock, par value $.001 per share; authorized 100,000,000 shares; issued 39,098,792 in 2019 and 37,450,329 in 2018		39			37
Class B Common Stock, par value $.001 per share; authorized 25,000,000 shares; issued and outstanding 1,617,998 in 2019 and 3,233,998 in 2018		2			3
Additional paid in capital		432,518			430,555
Retained earnings		698,496			589,645
Accumulated items of other comprehensive income:
Translation adjustments		(122,852	)		(115,976	)
Pension and postretirement liability adjustments		(49,994	)		(47,109	)
Derivative valuation adjustment		(3,135	)		4,697
Treasury stock (Class A), at cost 8,408,770 shares in 2019 and 8,418,620 shares in 2018		(256,391	)		(256,603	)
Total Company shareholders' equity		698,683			605,249
Noncontrolling interest		4,006			3,031
Total equity		702,689			608,280
Total liabilities and shareholders' equity		$1,474,368			$1,417,992

ALBANY INTERNATIONAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOW
(in thousands)
(unaudited)
Three Months Ended								Years ended
December 31,								December 31,
2019			2018					2019			2018
						OPERATING ACTIVITIES
$29,591			$17,272			Net income		$133,383			$83,019
						Adjustments to reconcile net income to net cash provided by operating activities:
15,426			15,948			Depreciation		62,085			68,800
2,405			2,665			Amortization		8,710			10,236
900			15,984			Change in deferred taxes and other liabilities		13,702			8,972
2,018			452			Provision for write-off of property, plant and equipment		3,119			3,707
151			155			Non-cash interest expense		605			459
450			1,494			Write-off of pension liability adjustments due to settlement/curtailment		450			1,494
650			324			Compensation and benefits paid or payable in Class A Common Stock		2,063			2,203
						Changes in operating assets and liabilities that provided cash, net of impact of business acquisition:
16,727			20,815			Accounts receivable		9,587			(19,139	)
(12,641	)		(1,546	)		Contract assets		(19,199	)		(10,267	)
13,004			15,440			Inventories		(8,923	)		(968	)
1,766			(698	)		Prepaid expenses and other current assets		(2,291	)		(5,815	)
728			(948	)		Income taxes prepaid and receivable		1,390			(1,402	)
2,687			3,186			Accounts payable		10,524			9,340
1,369			(3,962	)		Accrued liabilities		(7,393	)		8,209
2,360			(14,179	)		Income taxes payable		3,979			(824	)
(662	)		(3,403	)		Noncurrent receivables		(1,341	)		(12,249	)
(2,162	)		854			Other noncurrent liabilities		(6,573	)		(5,479	)
(1,008	)		1,238			Other, net		(3,525	)		(7,811	)
73,759			71,091			Net cash provided by operating activities		200,352			132,485
						INVESTING ACTIVITIES
(30,793	)		-			Purchase of business, net of cash acquired		(30,793	)		-
(18,512	)		(21,015	)		Purchases of property, plant and equipment		(67,358	)		(81,579	)
(291	)		(1,177	)		Purchased software		(597	)		(1,307	)
(49,596	)		(22,192	)		Net cash used in investing activities		(98,748	)		(82,886	)
						FINANCING ACTIVITIES
25,000			-			Proceeds from borrowings		45,000			26,031
(25,003	)		(5,299	)		Principal payments on debt		(120,017	)		(29,913	)
(304	)		-			Principal payments on finance lease liabilities		(1,180	)		-
-			-			Taxes paid in lieu of share issuance		(971	)		(1,652	)
7			-			Proceeds from options exercised		112			202
(5,816	)		(5,485	)		Dividends paid		(23,251	)		(21,926	)
(6,116	)		(10,784	)		Net cash used in financing activities		(100,307	)		(27,258	)
3,754			(953	)		Effect of exchange rate changes on cash and cash equivalents		(3,512	)		(8,313	)
21,801			37,162			(Decrease)/increase in cash and cash equivalents		(2,215	)		14,028
173,739			160,593			Cash and cash equivalents at beginning of period		197,755			183,727
$195,540			$197,755			Cash and cash equivalents at end of period		$195,540			$197,755

Reconciliation of non-GAAP measures to comparable GAAP measures

The following table presents Net sales and the effect of changes in currency translation rates:

(in $ thousands, except percentages)		Net Sales, as reported, Q4 2019		Decrease due to changes in currency translation rates		Q4 2019 sales on same basis as Q4 2018 currency translation rates		Net sales as reported, Q4 2018		% Change compared to Q4 2018, excluding currency rate effects
Machine Clothing		$150,580		$1,198		$151,778		$150,693		0.7%
Albany Engineered Composites		107,098		287		107,385		100,920		6.4%
Total		$257,678		$1,485		$259,163		$251,613		3.0%

(in $ thousands, except percentages)		Net Sales, as reported, FY 2019		Decrease due to changes in currency translation rates		FY 2019 sales on same basis as FY 2018 currency translation rates		Net sales as reported, FY 2018		% Change compared to FY 2018, excluding currency rate effects
Machine Clothing		$601,254		$10,474		$611,728		$611,858		0.0%
Albany Engineered Composites		452,878		4,349		457,227		370,621		23.4%
Total		$1,054,132		$14,823		$1,068,955		$982,479		8.8%

Adjusted EBITDA for the current-year and comparable prior-year periods has been calculated as follows:

Three months ended December 31, 2019
(in $ thousands)		Machine Clothing		Albany Engineered Composites		Corporate Expenses and Other		Total Company
Operating income/(loss) (GAAP)		$46,277		$10,922		($13,619)		$43,580
Interest, taxes, and other income/(expense)		-		-		(13,989)		(13,989)
Net income/(loss) (GAAP)		46,277		10,922		(27,608)		29,591
Interest expense, net		-		-		3,886		3,886
Income tax expense		-		-		9,754		9,754
Depreciation and amortization expense		5,201		11,611		1,019		17,831
EBITDA (non-GAAP)		51,478		22,533		(12,949)		61,062
Restructuring expenses, net		4		1,815		(53)		1,766
Foreign currency revaluation (gains)/losses		1,365		(12)		(748)		605
Pension curtailment expense		-		-		478		478
Acquisition expenses		-		301		200		501
Retention agreement expense		-		120		-		120
Pre-tax (income) attributable to non-controlling interest		-		(586)		-		(586)
Adjusted EBITDA (non-GAAP)		$52,847		$24,171		($13,072)		$63,946
Adjusted EBITDA margin (Adjusted EBITDA divided by Net sales – non-GAAP)		35.1%		22.6%		-		24.8%

Three months ended December 31, 2018
(in $ thousands)		Machine Clothing		Albany Engineered Composites		Corporate Expenses and Other		Total Company
Operating income/(loss) (GAAP)		$42,884		$6,667		($12,137)		$37,414
Interest, taxes, and other income/(expense)		-		-		(20,142)		(20,142)
Net income/(loss) (GAAP)		42,884		6,667		(32,279)		17,272
Interest expense, net		-		-		4,594		4,594
Income tax expense		-		-		10,538		10,538
Depreciation and amortization expense		6,542		10,909		1,162		18,613
EBITDA (non-GAAP)		49,426		17,576		(15,985)		51,017
Restructuring expenses, net		1,756		80		20		1,856
Foreign currency revaluation (gains)/losses		26		3		2,878		2,907
Pension settlement/curtailment		-		-		1,494		1,494
Pre-tax loss attributable to non-controlling interest		-		422		-		422
Adjusted EBITDA (non-GAAP)		$51,208		$18,081		($11,593)		$57,696
Adjusted EBITDA margin (Adjusted EBITDA divided by Net sales – non-GAAP)		34.0%		17.9%		-		22.9%

Year ended December 31, 2019
(in $ thousands)		Machine Clothing		Albany Engineered Composites		Corporate Expenses and Other		Total Company
Operating income/(loss) (GAAP)		$191,965		$55,520		($53,909)		$193,576
Interest, taxes, and other income/(expense)		-		-		(60,193)		(60,193)
Net income/(loss) (GAAP)		191,965		55,520		(114,102)		133,383
Interest expense, net		-		-		16,921		16,921
Income tax expense		-		-		44,829		44,829
Depreciation and amortization expense		21,876		44,670		4,249		70,795
EBITDA (non-GAAP)		213,841		100,190		(48,103)		265,928
Restructuring expenses, net		1,129		1,833		(57)		2,905
Foreign currency revaluation (gains)/losses		630		643		(4,463)		(3,190)
Pension curtailment expense		-		-		478		478
Acquisition expenses		-		301		200		501
Retention agreement expense		-		120		-		120
Pre-tax (income) attributable to non-controlling interest		-		(1,308)		-		(1,308)
Adjusted EBITDA (non-GAAP)		$215,600		$101,779		($51,945)		$265,434
Adjusted EBITDA margin (Adjusted EBITDA divided by Net sales – non-GAAP)		35.9%		22.5%		-		25.2%

Year ended December 31, 2018
(in $ thousands)		Machine Clothing		Albany Engineered Composites		Corporate Expenses and Other		Total Company
Operating income/(loss) (GAAP)		$169,836		$16,647		($49,075)		$137,408
Interest, taxes, and other income/(expense)		-		-		(54,389)		(54,389)
Net income/(loss) (GAAP)		169,836		16,647		(103,464)		83,019
Interest expense, net		-		-		18,124		18,124
Income tax expense		-		-		32,228		32,228
Depreciation and amortization expense		30,813		43,205		5,018		79,036
EBITDA (non-GAAP)		200,649		59,852		(48,094)		212,407
Restructuring expenses, net		12,278		3,048		244		15,570
Foreign currency revaluation (gains)/losses		(826)		547		(62)		(341)
Pension settlement/curtailment		-		-		1,494		1,494
Pre-tax (income) attributable to non-controlling interest		-		(197)		-		(197)
Adjusted EBITDA (non-GAAP)		$212,101		$63,250		($46,418)		$228,933
Adjusted EBITDA margin (Adjusted EBITDA divided by Net sales – non-GAAP)		34.7%		17.1%		-		23.3%

Per share impact of the adjustments to earnings per share are as follows:

Three months ended December 31, 2019
(in $ thousands, except per share amounts)		Pre-Tax Amount		Tax Effect		After-Tax Amount		Per Share Amount
Restructuring expenses, net		$1,766		$494		$1,272		$0.04
Foreign currency revaluation (gains)/losses		605		169		436		0.01
Pension curtailment charge		478		91		387		0.01
Acquisition expenses		501		120		381		0.01
Retention agreement expense		120		36		84		0.00
Three months ended December 31, 2018
(in $ thousands, except per share amounts)		Pre-Tax Amount		Tax Effect		After-Tax Amount		Per Share Amount
Restructuring expenses, net		$1,856		$581		$1,275		$0.04
Foreign currency revaluation (gains)/losses		2,907		910		1,997		0.06
Net pension settlement/curtailment charge		1,494		348		1,146		0.04
Year ended December 31, 2019
(in $ thousands, except per share amounts)		Pre-Tax Amount		Tax Effect		After-Tax Amount		Per Share Amount
Restructuring expenses, net		$2,905		$824		$2,081		$0.06
Foreign currency revaluation (gains)/losses		(3,190)		(904)		(2,286)		(0.07)
Pension curtailment charge		478		91		387		0.01
Acquisition expenses		501		120		381		0.01
Retention agreement expense		120		36		84		0.00
Year ended December 31, 2018
(in $ thousands, except per share amounts)		Pre-Tax Amount		Tax Effect		After-Tax Amount		Per Share Amount
Restructuring expenses, net		$15,570		$4,904		$10,666		$0.34
Foreign currency revaluation (gains)/losses		(341)		3		(344)		(0.01)
Net pension settlement/curtailment charge		1,494		348		1,146		0.04

The resulting fourth quarter and full-year Adjusted EPS are as follows:

		Three months ended December 31,				Years ended December 31,
Per Share Amounts (Basic)		2019		2018		2019			2018
Earnings per share (GAAP)		$0.90		$0.55		$4.10			$2.57
Adjustments, after tax:
Restructuring expenses, net		0.04		0.04		0.06			0.34
Foreign currency revaluation (gains)/losses		0.01		0.06		(0.07	)		(0.01	)
Pension settlement/curtailment		0.01		0.04		0.01			0.04
Acquisition expenses		0.01		-		0.01			-
Adjusted Earnings per share		$0.97		$0.69		$4.11			$2.94

The tables below provide a reconciliation of forecasted full-year 2020 Adjusted EBITDA and Adjusted EPS (non-GAAP measures) to the comparable GAAP measures:

Forecast of Full Year 2020 Adjusted EBITDA		Machine Clothing				AEC
(in $ millions)		Low		High		Low		High
Net income attributable to the Company (GAAP)		$169		$178		$30		$38
Interest expense, net		-		-		-		-
Income tax expense		-		-		-		-
Depreciation and amortization		21		22		50		52
EBITDA (non-GAAP)		190		200		80		90
Restructuring expenses, net (a)		-		-		-		-
Foreign currency revaluation (gains)/losses (a)		-		-		-		-
Adjusted EBITDA (non-GAAP)		$190		$200		$80		$90
Forecast of Full Year 2020 Adjusted EBITDA		Total Company
(in $ millions)		Low		High
Net income attributable to the Company (GAAP)		$87		$100
Interest expense, net		15		14
Income tax expense		30		38
Depreciation and amortization		75		80
EBITDA (non-GAAP)		207		232
Restructuring expenses, net (a)		-		-
Foreign currency revaluation (gains)/losses (a)		-		-
CEO severance		3		3
Adjusted EBITDA (non-GAAP)		$210		$235
Forecast of Full Year 2020 Adjusted Earnings Per Share
Per Share Amounts – Basic (b)		Low		High
Earnings per share (GAAP)		$2.68		$3.08
CEO severance		0.07		0.07
Adjusted Earnings per share (non-GAAP)		$2.75		$3.15

1. Due to the uncertainty of these items, we are unable to forecast these items for 2020
2. Calculations based on shares outstanding estimate of 32.3 million

About Albany International Corp.

Albany International is a leading developer and manufacturer of engineered components, using advanced materials processing and automation capabilities, with two core businesses. Machine Clothing is the world’s leading producer of fabrics and process felts used in the manufacture of all grades of paper products. Albany Engineered Composites is a rapidly growing designer and manufacturer of advanced materials-based engineered components for jet engine and airframe applications, supporting both commercial and military platforms. Albany International is headquartered in Rochester, New Hampshire, operates 23 plants in 11 countries, employs approximately 4,600 people worldwide, and is listed on the New York Stock Exchange (Symbol AIN). Additional information about the Company and its products and services can be found at www.albint.com.

Non-GAAP Measures

This release, including the conference call commentary associated with this release, contains certain non-GAAP measures, including: net sales, and percent change in net sales, excluding the impact of currency translation effects (for each segment and on a consolidated basis); EBITDA and Adjusted EBITDA (for each segment and on a consolidated basis, represented in dollars or as a percentage of net sales); Net debt and changes in Net debt; and Adjusted earnings per share (or Adjusted EPS). Such items are provided because management believes that they provide additional useful information to investors regarding the Company’s operational performance.

Presenting Net sales and increases or decreases in Net sales, after currency effects are excluded, can give management and investors insight into underlying sales trends. Net sales, or percent changes in net sales, excluding currency rate effects, are calculated by converting amounts reported in local currencies into U.S. dollars at the exchange rate of a prior period. These amounts are then compared to the U.S. dollar amount as reported in the current period.

EBITDA, Adjusted EBITDA and Adjusted EPS are performance measures that relate to the Company’s continuing operations. EBITDA, or net income with interest, taxes, depreciation, and amortization added back, is a common indicator of financial performance used, among other things, to analyze and compare core profitability between companies and industries because it eliminates effects due to differences in financing, asset bases and taxes. The Company calculates EBITDA by removing the following from Net income: Interest expense net, Income tax expense, Depreciation and amortization. Adjusted EBITDA is calculated by: adding to EBITDA costs associated with restructuring, and inventory write-offs associated with discontinued businesses; adding charges and credits related to pension plan settlements; adding (or subtracting) revaluation losses (or gains); subtracting (or adding) gains (or losses) from the sale of buildings or investments; subtracting insurance recovery gains in excess of previously recorded losses; adding acquisition and related retention agreement expenses and subtracting (or adding) Income (or loss) attributable to the non-controlling interest in Albany Safran Composites (ASC). Adjusted EBITDA may also be presented as a percentage of net sales by dividing it by net sales. An understanding of the impact in a particular quarter of specific restructuring costs, acquisition and related retention agreement expenses, currency revaluation, inventory write-offs associated with discontinued businesses, or other gains and losses, on net income (absolute as well as on a per-share basis), operating income or EBITDA can give management and investors additional insight into core financial performance, especially when compared to quarters in which such items had a greater or lesser effect, or no effect. Restructuring expenses in the MC segment, while frequent in recent years, are reflective of significant reductions in manufacturing capacity and associated headcount in response to shifting markets, and not of the profitability of the business going forward as restructured. Adjusted earnings per share (Adjusted EPS) is calculated by adding to (or subtracting from) net income attributable to the Company per share, on an after-tax basis: restructuring charges; charges and credits related to pension plan settlements and curtailments; inventory write-offs associated with discontinued businesses; foreign currency revaluation losses (or gains); acquisition expenses; and losses (or gains) from the sale of investments.

EBITDA, Adjusted EBITDA, and Adjusted EPS, as defined by the Company, may not be similar to similarly named measures of other companies. Such measures are not considered measurements under GAAP, and should be considered in addition to, but not as substitutes for, the information contained in the Company’s statements of income.

The Company discloses certain income and expense items on a per-share basis. The Company believes that such disclosures provide important insight into underlying quarterly earnings and are financial performance metrics commonly used by investors. The Company calculates the quarterly per-share amount for items included in continuing operations by using the income tax rate based on income from continuing operations and the weighted-average number of shares outstanding for each period. Year-to-date earnings per-share effects are determined by adding the amounts calculated at each reporting period.

Net debt is, in the opinion of the Company, helpful to investors wishing to understand what the Company’s debt position would be if all available cash were applied to pay down indebtedness. The Company calculates Net debt by subtracting Cash and cash equivalents from Total debt. Total debt is calculated by adding Long-term debt, Current maturities of long-term debt, and Notes and loans payable, if any.

Forward-Looking Statements

This press release may contain statements, estimates, guidance or projections that constitute “forward-looking statements” as defined under U.S. federal securities laws. Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “will,” “should,” “look for,” “guidance,” “guide,” and similar expressions identify forward-looking statements, which generally are not historical in nature. Because forward-looking statements are subject to certain risks and uncertainties (including, without limitation, those set forth in the Company’s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q), actual results may differ materially from those expressed or implied by such forward-looking statements.

Forward-looking statements in this release or in the webcast include, without limitation, statements about macroeconomic and paper-industry trends and conditions during 2019 and in future years; expectations in 2019 and in future periods of sales, EBITDA, Adjusted EBITDA (both in dollars and as a percentage of net sales), Adjusted EPS, income, gross profit, gross margin, cash flows and other financial items in each of the Company’s businesses, and for the Company as a whole; the timing and impact of production and development programs in the Company’s AEC business segment and the sales growth potential of key AEC programs, as well as AEC as a whole; the amount and timing of capital expenditures, future tax rates and cash paid for taxes, depreciation and amortization; future debt and net debt levels and debt covenant ratios; and changes in currency rates and their impact on future revaluation gains and losses. Furthermore, a change in any one or more of the foregoing factors could have a material effect on the Company’s financial results in any period. Such statements are based on current expectations, and the Company undertakes no obligation to publicly update or revise any forward-looking statements.

Statements expressing management’s assessments of the growth potential of its businesses, or referring to earlier assessments of such potential, are not intended as forecasts of actual future growth, and should not be relied on as such. While management believes such assessments to have a reasonable basis, such assessments are, by their nature, inherently uncertain. This release and earlier releases set forth a number of assumptions regarding these assessments, including historical results, independent forecasts regarding the markets in which these businesses operate, and the timing and magnitude of orders for our customers’ products. Historical growth rates are no guarantee of future growth, and such independent forecasts and assumptions could prove materially incorrect in some cases.

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Source: Albany International Corp.

John Hobbs
603-330-5897
john.hobbs@albint.com