Douglas Dynamics - PLOW - Long-term fundamentals of business remain strong
1/9/2013 12:59:50 PM
Douglas Dynamics, Inc. (NYSE:PLOW), the North American leader in the design, manufacture and sale of snow and ice control equipment for light trucks, announced preliminary financial results for its fourth quarter and full-year 2012.
PLOW Preliminary Full-Year 2012 Results
Douglas Dynamics expects that its full-year 2012 revenue, earnings before interest, taxes, non-cash and other items ("Adjusted EBITDA") and diluted earnings per share will be lower than previously anticipated.
- Revenue for 2012 is expected to be approximately $140 million. Prior revenue guidance for the year was $160 million to $190 million.
- Adjusted EBITDA for the full year is expected to be approximately $30 million. Prior financial guidance for the year indicated Adjusted EBITDA in the range of $35 to $45 million.
- Diluted earnings per share for full-year 2012 are expected to be approximately $0.25 to $0.27 per share pending final effective tax rate calculations. Prior financial guidance for the year was $0.55 to $0.79.
"During our third quarter earnings call we outlined our expectations that results would be at the bottom end of our guidance range. As the fourth quarter unfolded, we saw below average snowfall combined with very warm temperatures in most of our core markets through mid-December, which created challenging market conditions and has produced results that fell short of our expectations," noted James L. Janik, President and Chief Executive Officer of Douglas Dynamics. "These preliminary results reflect the culmination of multiple factors that negatively affected our business during the year: First, the timing, amount, and location of snowfall in the fourth quarter; second, lingering effects from last year's unprecedented low snowfall and record drought last summer; third, the continued macro-economic uncertainty. While difficult to quantify, we believe there was also a negative impact from Hurricane Sandy."
Janik added, "Despite these short-term issues, the long-term fundamentals of our business remain strong and we continue to generate significant cash flows and maintain a strong financial position. As we manage through the trough, we are focused on maintaining and even improving our market position and the Company remains well capitalized to drive growth and innovation and return cash to shareholders."
"While we did see a slow start to the snow season, we're encouraged by recent underlying weather patterns and, at this point in time, we anticipate average snowfall for the 2012/2013 season. It is worth noting that approximately 70% of a season's snowfall occurs after December and we're ready to capitalize on our improved operational efficiencies and leverage our vast distributor network as snowfall levels return towards normal. As we navigate through this difficult cycle, we have a continued focus on cost containment strategies and managing other factors that are within our control which we believe will allow us to emerge from the trough in a stronger position and with improved profitability."
PLOW Business Highlights in 2012
- Launched a record number of new product development initiatives
- Achieved new record of 98.9% for perfect shipment delivery performance
- Improved base business profitability resulting in increased contribution margin per unit
- Record number of cost reduction projects implemented
- Procurement through global sourcing initiatives reached an all-time high
- Strengthened supplier partnerships by sharing lean expertise and conducting multi-day Kaizen improvement events in supplier factories worldwide
About Douglas Dynamics - PLOW
Headquartered in Milwaukee, Wisconsin, Douglas Dynamics (PLOW) designs, manufactures and sells snow and ice control equipment for light trucks, which is comprised of snowplows and sand and salt spreaders, and related parts and accessories. Douglas Dynamics sells its products under the WESTERN®, FISHER® and BLIZZARD® brands through a distributor network, primarily consisting of truck equipment distributors located throughout the Midwest, East and Northeast regions of the United States as well as all provinces of Canada.