TriMas Corp. Reports Q1 Revenue Increase

TriMas Corp., Bloomfield Hills, Mich., a manufacturer of hitches through its Cequent division along with other divisions that make an assortment of non-RV related products, has announced financial results for the quarter ended March 31.

The company reported quarterly net sales from continuing operations of $220.1 million, an increase of 9.1% from first quarter 2009, according to a new release.

First quarter 2010 income from continuing operations was $5.8 million, a 24.5% improvement from $4.6 million in first quarter 2009. TriMas reported first quarter 2010 diluted earnings per share from continuing operations of $0.17, as compared to $0.14 during first quarter 2009. Excluding special items, first quarter 2009 loss from continuing operations would have been $0.7 million, or ($0.01) per share.

The company reported operating profit of $25.1 million in first quarter 2010, as compared to operating profit of $5.2 million during first quarter 2009. Excluding the impact of special items, operating profit would have improved 110%, from $12.0 million in first quarter 2009 to $25.1 million in first quarter 2010, which represents an increase in operating profit margin of 550 basis points.

In its Cequent division, TriMas reported sales for the first quarter increased 6.8% compared to the year-ago period, resulting from increased sales in the Australian/Asia Pacific and North American towing, trailer and electrical products businesses, and the favorable impact of currency exchange, partially offset by a decline in sales in the retail business.

Due to cost-reduction actions and improved sales levels, operating profit margin improved more than 840 basis points compared to first quarter 2009. The company continues to aggressively reduce fixed costs, decrease working capital and leverage strong brand positions for increased market share.

TriMas raised its outlook for full-year 2010 diluted earnings per share (EPS) from continuing operations to $0.65 to $0.75 per share, as compared to $0.43 per share in 2009, excluding special items in both periods. The company previously provided an outlook for 2010 EPS to exceed $0.60 per share. TriMas also raised its 2010 sales outlook from an increase of 4% to 7% to a range of 5% to 9% compared to 2009. In addition, the company expects its 2010 operating profit margin to improve by 80 to 120 basis points compared to 2009, excluding special items.

TriMas Corp. Reports 20.7% 2009 Sales Drop

TriMas Corp. Tuesday (March 2) announced financial results for the quarter and full year ended Dec. 31, 2009.

For the quarter, the company reported sales from continuing operations of $191.1 million, a decline of 9.9% compared to the fourth quarter of 2008. The company reported a fourth quarter loss from continuing operations of $8.9 million, compared to loss from continuing operations of $149.8 million in fourth quarter 2008.

For the year ended Dec. 31, 2009, the company reported sales from continuing operations of $803.7 million, a 20.7% decline compared to 2008. The company reported full year income from continuing operations of $12.7 million, compared to a loss from continuing operations of $124.1 million in 2008.

Excluding Special Items for both periods, 2009 income from continuing operations would have been $14.9 million, as compared to 2008 income from continuing operations of $28.4 million, or $0.85 per diluted share.

As for TriMas’s Cequent Performance Products Division, sales for the fourth quarter increased 16% compared to the year ago period, resulting from increases in sales in the Australia/Asia Pacific and retail businesses and the favorable impact of currency exchange. Sales for the year decreased 12.1% compared to the year ago period due to weak, but improving, consumer demand for heavy-duty towing, trailer and electrical products and the unfavorable effects of currency exchange, partially offset by an increase in sales in the retail business and a slight improvement in sales in the Australia/Asia Pacific business.

Operating profit for the quarter and year improved as a result of cost reductions implemented as part of the company’s profit improvement plan, partially offset by lower sales volumes and lower absorption of fixed costs. Due to the cost reduction actions, operating profit margin for the full year 2009 improved approximately 240 basis points compared to 2008. The company continues to aggressively reduce fixed costs, decrease working capital and leverage strong brand positions for increased market share.

Outlook

The company is estimating 2010 sales to increase 4-7%, compared to 2009. The company expects full-year 2010 diluted earnings per share (EPS) from continuing operations to exceed $0.60 per share, in comparison to $0.43 per share in 2009, excluding Special Items in both periods. In addition, the company expects its operating profit margin to improve by 60 to 100 basis points, compared to 2009, excluding Special Items, and Free Cash Flow to be in excess of $30 million.

“While we expect only a modest recovery in our end markets during 2010, we expect our planned growth and productivity initiatives to expand margins and accelerate our ability to grow earnings during the year,” said David Wathen, president and CEO. “The foundation we laid in 2009 will enhance our results in 2010, and provide for even greater margin expansion as normal end market demand returns.”

TriMas Corp. Concludes Refinancing Activities

TriMas Corp. today (Jan. 14) announced it has concluded the final step of its previously announced refinancing activities with the completion of the cash tender offer for its outstanding 9 7/8% Senior Subordinated Notes due 2012.

According to a news release, the refinancing activities for TriMas included:

• The amendment of its credit agreement to extend the maturity of $226.3 million of $252.2 million in term loans from August 2013 to December 2015, which is expected to improve the company’s financial flexibility. The maturity date and interest margins of approximately $26 million in term loans held by lenders that did not consent will remain unchanged.
• Extending the maturities of $75 million in revolving credit commitments from August 2011 to December 2013. The maturities and interest margin of $8 million in revolving credit commitments remains unchanged.
• The issuance of $250 million principal amount of 9 3/4% Senior Secured Notes due 2017, the proceeds of which, together with other available cash, were used to redeem $256 million principal amount of outstanding notes.
• A new three-year accounts receivable facility which provides committed funding of up to $75 million and is expected to provide up to $25 million in increased availability at a lower cost of funds than the 364-day accounts receivable facility that it replaces.

“The refinancing activities of the past month improve and extend TriMas’ debt maturity profile, as well as provide additional financial flexibility that allows us to continue to execute on our business plan,” commented David Wathen, TriMas president and CEO. “We will remain focused on improving our operating performance via productivity initiatives and increased cash generation, allowing us to continue our progress in reducing debt and strengthening the balance sheet. We appreciate the cooperation we have received from our lenders and other stakeholders.”

TriMas is the parent company of RV supplier Cequent Performance Products.

TriMas Corp. Gains New 3-Year Lending Facility

TriMas Corp. announced Tuesday (Dec. 29) that it entered into a new accounts receivable facility with Wachovia Bank NA. The  new facility, which has a three-year term, provides committed funding of up to $75 million.

The new accounts receivable facility provides a source of liquidity for the company at a cost of funds equal to the three-month LIBOR (currently approximately 0.25%) plus a spread ranging from 2.75% to 3.50% (currently 3.25%) on amounts drawn under the facility. This facility replaces the company’s existing $55 million 364-day accounts receivables securitization facility.

“This new agreement reflects our continued efforts to ensure that TriMas has adequate liquidity, and together with the company’s recently amended bank credit facility and senior secured notes offering, will improve our financial flexibility,” said Mark Zeffiro, TriMas CFO. “In addition to increasing the level of committed funding from $55 million to $75 million, we will benefit from improved pricing (currently 125 basis points lower than the existing facility) and the reduction of refinancing risk resulting from a three-year commitment. The recent actions taken to improve our capital structure will allow us to support our planned productivity and growth initiatives and accelerate the positive changes taking place within our organization.”

TriMas is the parent company of Cequent Performance Products.

TriMas Corp. Announces Early Tender Results

TriMas  Corp. today (Dec. 29) announced, as of 5 p.m., EST, on Dec.28, it had received tenders and certain-related consents discussed below from holders of $245,626,000 in aggregate principal amount of its 9-7/8% Senior Subordinated Notes due 2012, representing approximately 95.75% of the outstanding notes.

As a result of the receipt of the requisite consents, the issuer has entered into a supplemental indenture with the trustee effecting the proposed amendments to the indenture governing the notes. The proposed amendments eliminate substantially all of the restrictive covenants and certain default provisions under the indenture governing the notes, according to a news release from the Bloomfield Hills, Mich.-based manufacturer.

In accordance with the terms of the tender offer and consent solicitation, the issuer is hereby extending the withdrawal deadline to 11:59 p.m.EST on Jan. 12. As a result, any holder of notes who validly tenders notes after the consent date may withdraw such tender through 11:59 p.m.EST on Jan. 12 in accordance with the procedures described in the tender offer documents under the caption “Withdrawal of Tenders.”

Holders who did not tender their notes by the consent date may tender until 11:59 p.m.EST on Jan. 12, unless extended by the issuer at the tender price of $970.25 for every $1,000 of principal amount of notes, plus accrued and unpaid interest. Holders who tender notes after the consent date will not receive the consent payment. Full details of the terms and conditions of the tender offer are set forth in the tender offer Documents.

TriMas is simultaneously announcing that it is irrevocably calling for redemption of all notes that remain outstanding after the consent date at the redemption price of $1,016.46 for every $1,000 of principal amount of notes, plus accrued and unpaid interest.

TriMas has engaged Credit Suisse Securities (USA) LLC to act as dealer manager in connection with the tender offer and solicitation agent in connection with the consent solicitation. Questions regarding the tender offer or consent solicitation may be directed to Credit Suisse Securities (USA) LLC at (212) 538-1862 (collect) or (800) 820-1653.

MacKenzie Partners Inc. is acting as the information agent for the tender offer and consent solicitation. Requests for documents related to the tender offer and consent solicitation may be directed to (212) 929-5500 (collect) or (800) 322-2885. Beneficial owners also may contact their broker, dealer, commercial bank, trust company or other nominee for assistance concerning the tender offer and the consent solicitation.

TriMas Amends Credit Arrangement With Lenders

TriMas Corp. announced Wednesday (Dec. 16) that it has executed an amendment and restatement of its credit agreement with certain of its lenders to extend the maturity of $220.1 million of its $252.2 million in term loans from Aug. 2, 2013, to Dec. 15, 2015.

The credit agreement has also been amended for certain items, including modified financial covenant levels to improve financial flexibility and the ability to refinance existing subordinated notes with senior secured notes, according to a news release from the Bloomfield Hills, Mich.-based company.

Over 88% of the company’s existing lenders agreed to the amendment. TriMas’ borrowing costs on the extended term loans will be at LIBOR plus 4.00%, with a “LIBOR floor” of 2%. The maturity date and interest margins with respect to those term loans held by lenders that did not consent to extend the maturity of their term loans will remain unchanged.

In addition, pursuant to the amendment, certain revolving credit lenders have agreed to extend the maturity of $70 million (on an as reduced basis) out of $90 million in revolving credit commitments from Aug. 2, 2011, to Dec. 15, 2013. After giving effect to reductions in revolving commitments of certain extending revolving lenders, the company has $78 million of total revolving credit commitments. The company’s borrowing costs with respect to revolving credit loans made pursuant to such extended revolving credit commitments will be at LIBOR plus 4%, without an applicable “LIBOR floor.”

The commitment fee payable with respect to the undrawn extended revolving credit commitments will be increased to 0.75%. The maturity date and interest margins with respect to those revolving credit commitments held by lenders that did not consent to extend will remain unchanged.

“We view this refinancing as very positive for TriMas, allowing us to continue on our path of continuous improvement,” said David Wathen, TriMas president and CEO. “We have demonstrated improved operating performance via cost reduction activities and increased cash generation, allowing us to reduce debt by over $100 million through the first three quarters of 2009. We will continue this focus going forward and are pleased that we received such support from our existing lenders.”

TriMas is the parent company of Cequent Performance Products.

TriMas Corp. to Issue $250M in Senior Secured Notes

TriMas Corp. announced Monday (Dec. 14) its intent to offer to qualified institutional buyers under Rule 144A and to persons outside the United States under Regulation S $250 million aggregate principal amount of senior secured notes due 2017, according to a news release.

The proceeds of the proposed offering, together with cash on hand, will be used by TriMas to purchase, redeem or otherwise retire all of its outstanding 9 7/8% senior subordinated notes due 2012. The offering is subject to market and other customary conditions.

TriMas is the parent company of Cequent Performance Products.

TriMas Seeks to Amend/Extend Credit Facilities

TriMas Corp. has announced that it has initiated a process to amend and extend its credit facilities. If approved, the proposed amendment would extend the maturity of the company’s revolving credit facility from August 2011 to December 2013 and its $252 million term loan from June 2013 to December 2015, according to a news release.

The Bloomfield Hills, Mich.-based parent company of Cequent Performance Products expects to pay an increased interest rate consistent with market conditions to those lenders that agree to extend the maturity of their term loans or revolving credit commitments.

“The financial markets have presented TriMas with the opportunity to consider refinancing our bank debt with terms that we believe are very good for TriMas’ capital structure and the future of the company,” said Dave Wathen, president and CEO. “TriMas’ liquidity is strong with $156 million of cash and available liquidity under our revolving credit and receivables securitization facilities as of Sept. 30, 2009. Based on discussions with our financial advisers, we believe this is an excellent time to take advantage of the current credit markets to seek to extend the maturity of our debt.”

Cequent to Provide Towing System on Ford Trucks

Cequent Performance Products will supply an optional cross-bed towing system on the 2011 Ford Super Duty F-series truck, according to Automotive News.

The towing system, for towing gooseneck and fifth-wheel trailers of up to 25,000 pounds, is produced at the Cequent plant in Goshen, Ind., and then shipped to Magna International Inc.’s plant in Bowling Green, Ohio, for frame assembly and then on to Ford’s truck plant in Louisville, Ky.

Production of the trucks will start in January and the vehicles will be at dealerships by mid-February, a Cequent spokewoman told Automotive News. Cequent, a subsidiary of TriMas Corp. of suburban Detroit, makes cargo management and rack systems, towing and hitch systems and trailer and electrical brake systems.

TriMas’ Cequent Segment Reports 6.5% Sales Dip

TriMas Corp. today (Nov. 9) announced financial results for the quarter ended Sept. 30.

The Bloomfield Hills, Mich.-based company reported quarterly net sales from continuing operations of $203.7 million, a decrease of 21.9% from third quarter of 2008. Third quarter 2009 income from continuing operations decreased 19.2% from third quarter 2008 to $6.5 million from $8.1 million a year ago, according to a news release.

For its Cequent towing products segment, sales decreased 6.5% for the third quarter compared to the year ago period. The company continued to experience weak, but improving, consumer demand for heavy-duty towing, trailer and electrical products, as a result of uncertain economic conditions and reductions in consumer discretionary spending, and the unfavorable effects of currency exchange, partially offset by a slight increase in sales in the Australia/Asia Pacific business.

Operating profit for the quarter improved as a result of cost reductions implemented as part of the company’s Profit Improvement Plan, partially offset by lower sales volumes, unfavorable foreign currency exchange and lower absorption of fixed costs. Due to the cost reduction actions, operating profit as a percentage of sales also improved approximately 560 basis points compared to the third quarter of 2008. The segment was negatively impacted by $2.1 million in charges associated with the closure of its Mosinee, Wis., manufacturing facility and other business restructuring costs. The company continues to aggressively reduce fixed costs, decrease working capital and leverage strong brand positions for increased market share.

“We are executing on our productivity, working capital and growth initiatives,” said David Wathen, TriMas president and CEO. ”Compared to last quarter, we improved operating profit margin by 280 basis points on slightly lower revenues, decreased operating working capital by almost $23 million and generated over $43 million of free cash flow. Sales and end market demand are still down, but we are using this environment to make TriMas a permanently better business.

“As we move forward, we will continue our focus on reducing costs and working capital in each business segment. We remain focused on debt reduction and the protection of our liquidity. During the quarter, we reduced total indebtedness by $22 million and ended the quarter with almost $25 million in cash. While we are pleased with the progress we are making across these initiatives, there is more work to be done.

“For the full year of 2009, we continue to anticipate revenue to be down 20% to 25% compared to 2008, consistent with our comments last quarter. We are  allocating some resources to key growth initiatives aimed at expanding end markets and geographies. We are also beginning to see positive signs in some of our businesses, as our Packaging and Cequent segments project fourth quarter 2009 revenues close to fourth quarter 2008 levels. These developments lead us to expect at least modest revenue gains for next year. We are, however, continuing to operate our company with the realization we are still in a time of economic uncertainty. We are committed to maintaining cushion on our bank covenants, delevering TriMas and ensuring liquidity for our future endeavors.”

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