Commercial Vehicle Group announces second quarter 2020 results

Commercial Vehicle Group, Inc. (the “Company” or “CVG”) today reported financial results for the second quarter ended June 30, 2020, including revenues of $126.9 million, net loss of $12.5 million, EPS of $(0.40), pre-tax special charges of $7.0 million, and adjusted EPS of $(0.24).

“We navigated through an incredibly difficult quarter which was exacerbated by the COVID-19 pandemic that led to a rapid contraction in our end markets and the temporary shutdowns of our customers’ operations. However, we moved quickly to align the business to the new realities we are facing, and as a result of our actions, we generated positive adjusted EBITDA and free cash flow during the quarter, while maintaining liquidity of greater than $100 million,” commented Harold Bevis, President and Chief Executive Officer of CVG.

“Importantly, we had significant new business wins with a large e-commerce customer to deliver warehouse automation and material handling equipment, and seating systems for last mile delivery electric vehicles, which we expect will come online in the next few quarters. We are also seeing strong signs of recovery in our core end markets. We continue to feel effects of the global pandemic throughout our operations and we believe we are taking necessary precautions to keep our employees safe and healthy and to keep our operations running efficiently. Our cost optimization efforts, including permanent and temporary cost reduction measures, coupled with the significant new business wins during the quarter have created new momentum and energy within the Company,” concluded Mr. Bevis.

Consolidated Results

Second Quarter 2020 Results

• Second quarter 2020 revenues were $126.9 million compared to $243.2 million in the prior year period, a decrease of 47.8%. The decrease in revenues reflects the sharp declines in sales due to the COVID-19 pandemic and market declines, and more specifically lower heavy-duty truck production in North America and in the global construction markets we serve, partially offset by an increase in industrial and military revenues primarily attributable to the First Source Electronics (“FSE”) business. Foreign currency translation adversely impacted second quarter 2020 revenues by $1.8 million, or by 0.7%.

• Operating loss for the second quarter 2020 was $10.5 million compared to operating income of $15.9 million in the prior year period. The operating loss is primarily attributable to lower sales volume, and the second quarter results include charges of $2.9 million associated with ongoing restructuring initiatives, a $3.5 million charge for future milestone payments related to the performance of the FSE business and charges of $0.4 million associated with the 2019 restatement investigation. The second quarter of 2020 adjusted operating loss was $3.6 million when excluding special charges. The impact of the decline in sales and second quarter specific costs were partially offset by cost reduction initiatives.

• Interest associated with our debt and other expenses were $5.1 million and $7.5 million for the three months ended June 30, 2020 and 2019, respectively. The second quarter of 2019 results include a $2.5 million non-cash charge associated with the early payout of benefits to employees with deferred vested balances in the U.S. defined benefit pension plan.

• Net loss was $12.5 million for the second quarter 2020, or $0.40 per diluted share, compared to net income of $6.1 million in the prior year period, or $0.20 per diluted share.

At June 30, 2020, the Company had $15.0 million outstanding under its revolving credit facility and liquidity of $106.6 million; $63.4 million of cash and $43.2 million of availability from the revolving credit facility.

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SOURCE: Commercial Vehicle Group