BLOOMFIELD HILLS—The diversified manufacturer TriMas Corp. (NASDAQ: TRS) reported net income of $23.7 million in the fourth quarter ended Dec. 31, down from $38.4 million in the same quarter of 2019. Revenue was $188.2 million, up 10.1 percent from $170.9 million in the same quarter of 2019.
A sharp increase in the cost of sales, an increase in selling, general, and administrative expenses, and higher tax payments produced the lower profit despite higher sales.
The company also reported “adjusted income from continuing operations,” excluding restructuring and acquisition costs and discontinued operations, of $16.5 million during the quarter, or 38 cents a share, up 18.3 percent from $13.9 million or 31 cents a share a year earlier.
For the full year, the company posted a loss of $79.8 million, compared to net income of $89.6 million a year earlier. Revenue was $770 million, up 6.4 percent from $732.5 million in 2019, driven by growth in the Packaging segment and recent acquisitions. The reason was a non-cash impairment charge in goodwill and intangible assets of $134.6 million in the aerospace segment. The charge, which was taken in the third quarter, reflects the decreased prospects for this segment due to lower aircraft production caused by the pandemic.
“While 2020 presented us with unprecedented challenges, we leveraged our TriMas Business Model to anticipate disruptions to our plan, and in turn, took swift actions to implement changes to both protect our workforce and meet customer demands,” said Thomas Amato, TriMas president and CEO. “Through our multi-industry family of businesses and our dedicated global team, we delivered solid financial results, and also continued to make progress against TriMas’ overarching strategy.” Amato noted that the company met the adjusted earnings and cash flow outlooks it set at the beginning of 2020, prior to the pandemic.
The company said it expects sales growth of 4 to 9 percent in the first quarter of 2021, and adjusted earnings per share of 34 to 39 cents a share.
The company used $193.5 million for acquisitions during the year and $39.4 million for stock repurchases. It ended the year with $272.3 million in debt, up from $122.2 million a year earlier.
In the fourth quarter, the packaging segment, which accounts for 63 percent of TriMas’ sales, saw a 32.2 percent sales increase, primarily due to products in applications that fight the spread of germs and are used in cleaning. In the aerospace segment, which accounts for 22 percent of TriMas’ sales, sales plunged 23.5 percent, due to lower air travel and reduced aircraft production. The specialty products segment, which accounts for 15 percent of TriMas’ sales, sales fell 5.9 percent due to lower demand for engines and compressors used in oil and gas industry applications.
The company sold its Lamons business, a provider of sealing products for the oil and gas industry, on Dec. 20. It had annual revenue of about $180 million. The move reduced TriMas’ exposure to the oil and gas industry from 20 percent of sales to less than 2 percent.
To listen to a conference call discussing these results, call (888) 203-1112, using replay pass code 6413483. More in the investors section of www.trimascorp.com.