Milacron Holdings Corp. (NYSE:MCRN) Files An 8-K Results of Operations and Financial Condition
Item2.02. Results of Operations and Financial Condition
See Item 7.01 below, which is incorporated by reference herein.
Item7.01. Regulation FD.
Milacron Holdings Corp. (the Company) today reported preliminary
results for the fourth quarter and full year ended December31,
2016. The Company is in the process of finalizing its financial
results for the fiscal year ended December31, 2016. Based on
available information to date, the Company expects to report
sales for the fiscal quarter ended December31, 2016 of between
$287.0million and $289.0million, compared to $306.3million for
the fiscal quarter ended December31, 2015, and for the fiscal
year ended December31, 2016 of between $1,165.0million and
$1,167.0million, compared to $1,179.5million for the fiscal year
ended December31, 2015. Sales were negatively impacted by
$4.5million during the fiscal quarter ended December31, 2016 as a
result of unfavorable foreign currency movements. This foreign
currency impact was $3.5million higher than we anticipated due to
the additional strengthening of the U.S. dollar during the
quarter.The Company expects to report net income (loss) for the
fiscal quarter ended December31, 2016 of between $(15.9) million
and $2.7million, compared to $15.5million for the fiscal quarter
ended December31, 2015, and for the fiscal year ended December31,
2016 of between $13.4million and $32.0million, compared to
$(38.8) million for the fiscal year ended December31, 2015;
Adjusted Net Income for the fiscal quarter ended December31, 2016
of between $18.1million and $34.5million, compared to
$33.5million for the fiscal quarter ended December31, 2015, and
for the fiscalyear ended December31, 2016 of between $90.8million
and $107.2million, compared to $98.2million for the fiscal year
ended December31, 2015; and Adjusted EBITDA for the fiscal
quarter ended December31, 2016 of between $50.0million and
$53.0million, compared to $58.9million for the fiscal quarter
ended December31, 2015, and for the fiscal year ended December31,
2016 of between $209.0million and $212.0million, compared to
$213.4million for the fiscal year ended December31, 2015. The
Company also anticipates having a cash balance of $130.0million
as of December31, 2016, compared to $67.5million as of
December31, 2015. The estimated fourth quarter and full-year
financial data presented above within a range are preliminary,
unaudited and based upon our estimates. In addition, such
preliminary data are subject to the completion of the Companys
year-end financial and accounting closing procedures (which have
yet to be performed) and should not be viewed as a substitute for
full quarterly or annual financial statements prepared in
accordance with GAAP. The Company has provided a range for the
preliminary data described above primarily because its financial
closing procedures for the fiscal quarter and fiscal year ended
December31, 2016 are not yet complete. All of the data presented
above have been prepared by and are the responsibility of
management. The Companys independent registered public accounting
firm, Ernst Young LLP, has not audited, reviewed, compiled or
performed any procedures, and does not express an opinion or any
other form of assurance with respect to any of such data. This
summary is not a comprehensive statement of the Companys
financial results for the periods and the Companys actual results
may differ materially from these estimates as a result of the
completion of the Companys financial closing procedures, final
adjustments or other developments that may arise between now and
the time the financial results for these periods are finalized.
The following table sets forth a reconciliation of the Companys
estimated fourth quarter and full-year 2016 net (loss) income to
estimated fourth quarter and full-year 2016 Adjusted EBITDA:
|
FinancialResultsforthe Three Months Ended December31, 2016 is Expected to be Between |
FinancialResultsforthe YearEndedDecember31, 2016 is Expected to be Between |
|||||||
| (dollars in millions) | (unaudited) | (unaudited) | ||||||
|
Net (loss) income (a) |
$ | (15.9)-$2.7 | $ | 13.4 – $32.0 | ||||
|
Amortization expense |
7.8 | 31.3 | ||||||
|
Currency effect on intercompany advances (b) |
5.7 | (1.6 | ) | |||||
|
Organizational redesign costs (c) |
17.0 | 31.7 | ||||||
|
Long-term equity awards and shareholder fees (d) |
1.9 | 7.1 | ||||||
|
Professional services (e) |
1.7 | 4.2 | ||||||
|
Fair market value adjustments (f) |
0.3 | |||||||
|
Annual effective tax rate adjustment (g) |
(3.6)-(5.8 | ) | (1.2)-(3.4 | ) | ||||
|
Other |
3.5 | 5.6 | ||||||
|
Adjusted Net Income |
18.1 – 34.5 | 90.8-107.2 | ||||||
|
Income tax expense (benefit) (a) |
9.3-(4.1 | ) | 28.7-15.3 | |||||
|
Interest expense, net |
15.3 | 60.9 | ||||||
|
Depreciation expense |
7.3 | 28.6 | ||||||
|
Adjusted EBITDA |
$ | 50.0-$53.0 | $ | 209.0-$212.0 | ||||
| (a) |
Approximately $10.9million of this variance relates to the potential release of valuation allowances of up to $10.9million recorded against deferred tax assets as a result of restructuring initiatives in Europe. The actual amount of any such release of valuation allowances will not be known prior to the completion of our audit. |
| (b) |
Non-cash currency effect on intercompany advances relates to advances in foreign currencies. The most significant exposure relates to the Canadian dollar to intercompany advances within the MDCS segment. |
| (c) |
Organizational redesign costs relate to costs associated with exiting of product lines, the shutdown or relocation of facilities and the termination costs as a result of eliminated positions. |
| (d) |
Long-term equity awards and shareholder fees include charges associated with stock-based compensation awards granted to certain executives and independent directors. |
| (e) |
Professional fees relate to operational efficiency, strategic organizational initiatives, business development and other one-time advisory projects. |
| (f) |
Non-cash fair market value adjustments relate to fair market value expense adjustments to inventory during the period. |
| (g) |
The annual effective income tax rate adjustment primarily includes the impact to the tax provision utilizing the annual effective tax rate recomputed with anticipated tax rate reductions that have not been recognized for U.S. GAAP purposes as the Company is awaiting regulatory approval. |
The information contained in Item 2.02 and Item7.01 is being
furnished and shall not be deemed filed for any purpose, and
shall not be deemed incorporated by reference in any filing under
the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, regardless of any general
incorporation language in any such filing.
About Milacron Holdings Corp. (NYSE:MCRN)
Milacron Holdings Corp. is engaged in the manufacture, distribution, and service of engineered and customized systems used in the plastic technology and processing industry. The Company operates through three segments: Advanced Plastic Processing Technologies (APPT), Melt Delivery and Control Systems (MDCS), and Fluid Technologies (Fluids). The APPT segment is engaged in the manufacture, distribution and service of equipment and products used in the plastic technology and processing industry, including injection molding, blow molding and extrusion applications. The MDCS segment is engaged in the manufacture of plastic delivery and precision control systems, which are recurring, consumable sales for injection molding applications. The Fluids segment is engaged in the manufacture of coolants, lubricants, process cleaners and corrosion inhibitors that are used in a range of metalworking industries, such as cutting, grinding, stamping and forming and high speed machining. Milacron Holdings Corp. (NYSE:MCRN) Recent Trading Information
Milacron Holdings Corp. (NYSE:MCRN) closed its last trading session 00.00 at 18.54 with 34,958 shares trading hands.
