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TRIMAS CORPORATION Reports Operating Results (10-Q)

October 25, 2012 | About:
10qk

10qk

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TRIMAS CORPORATION (TRS) filed Quarterly Report for the period ended 2012-09-30.

Trimas Corp has a market cap of $932.4 million; its shares were traded at around $23.59 with a P/E ratio of 14 and P/S ratio of 0.9.

Highlight of Business Operations:

Packaging. Net sales increased approximately $31.2 million, or 67.6%, to $77.2 million in the three months ended September 30, 2012, as compared to $46.1 million in the three months ended September 30, 2011. Of this increase, approximately $23.6 million and $4.8 million were a result of our acquisitions of Arminak in February 2012 and Innovative Molding in August 2011, respectively. Sales of our specialty systems products increased by approximately $3.3 million, primarily due to increased demand from our North American dispensing customers. In addition, sales of our industrial closures, rings and levers increased approximately $0.8 million, as an increase in North American sales more than offset a decline in European sales. These increases in sales were partially offset by a decrease of approximately $1.3 million due to unfavorable currency exchange, as our reported results in U.S. dollars were negatively impacted as a result of the stronger U.S. dollar relative to foreign currencies.

Packaging. Net sales increased approximately $64.4 million, or 46.7%, to $202.3 million in the nine months ended September 30, 2012, as compared to $137.9 million in the nine months ended September 30, 2011. Our acquisitions of Arminak in February 2012 and Innovative Molding in August 2011 contributed sales of approximately $45.0 million and $24.0 million, respectively. Sales of our specialty systems products increased by approximately $4.1 million, as an increase in North American sales more than offset a decline in European sales. These increases in sales were partially offset by a decrease in sales of our industrial closures, rings and levers of approximately $5.3 million, primarily due to continued weak demand throughout Europe and lower demand in North America during the first half of 2012 as customers reduced inventories in response to uncertain economic conditions. In addition, sales decreased by approximately $3.4 million due to unfavorable currency exchange, as our reported results in U.S. dollars were negatively impacted as a result of the stronger U.S. dollar relative to foreign currencies.

Packaging's selling, general and administrative expenses increased approximately $6.1 million to $25.3 million, or 12.5% of sales, in the nine months ended September 30, 2012, as compared to $19.2 million, or 13.9% of sales, in the nine months ended September 30, 2011. This segment incurred approximately $1.0 million in combined travel, legal, finance and other diligence costs associated with consummating the acquisition of Arminak and approximately $2.4 million of intangible asset amortization costs for both Arminak and Innovative Molding. The remainder of the year-over-year increase is primarily related to operating selling, general and administrative expenses in the two acquired companies, partially offset by the recognition of a previously deferred gain of $1.5 million associated with the segment's postretirement benefit plan, as a result of not having any remaining eligible participants. Selling, general and administrative expenses decreased as a percentage of sales due to both the postretirement gain and the operating leverage gained on the higher sales levels.

Energy. Net sales for the nine months ended September 30, 2012 increased approximately $17.4 million, or 13.8%, to $143.2 million, as compared to $125.8 million in the nine months ended September 30, 2011. Of this increase, approximately $1.3 million was due to the acquisition of CIFAL in July 2012, $7.1 million was due to continued market share gains within our highly-engineered bolt product line and $2.8 million resulted from sales generated by our new Grimsby, UK; Midland, Michigan; Minneapolis, Minnesota; Tarragona, Spain; and Singapore branch facilities. The remaining $7.1 million was primarily due to increased levels of turnaround activity at refineries and petrochemical plants and increased activity with upstream/midstream customers. These increases were partially offset by approximately $0.9 million due to unfavorable currency exchange, as our reported results in U.S. dollars were negatively impacted as a result of the stronger U.S. dollar relative to foreign currencies.

Cequent Americas. Net sales increased approximately $13.8 million, or 4.5%, to $320.0 million in the nine months ended September 30, 2012, as compared to $306.2 million in the nine months ended September 30, 2011, primarily due to a year-over-year increase within our auto OE, industrial, aftermarket and retail channels. Of this increase, $6.5 million relates to sales within our auto OE channel, as we increased sales levels on both brake control and core hitches to our original equipment customers. Sales within our industrial channel increased by $2.5 million, primarily in the industrial OE market, and sales within our aftermarket channel increased $2.1 million, predominately in the Internet retailer market. In addition, sales in our retail channel increased approximately $2.4 million in the nine months ended September 30, 2012 compared to the nine months ended September 30, 2011, despite a one-time stocking order of approximately $4.5 million for a significant customer in the first quarter of 2011 that did not recur in 2012. We were able to more than replace the sales of the 2011 one-time stocking order via market share gains at certain of our existing customers to whom we now provide additional products and through sales related to our new broom and brush product line. In addition, we generated $0.7 million in sales from our July 2012 acquisition of Engetran.

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