Accuride Corporation (NYSE: ACW) reported third-quarter net sales of $184 million, compared with $155.3 million in the same period in 2013, an increase of 18.5 percent.
The company achieved operating income of $10 million for the quarter, compared to an operating loss of $0.7 million in the third quarter of 2013. The company reported net income from continuing operations of $1.2 million, or $0.02 per share, for the quarter, compared to a 2013 third quarter net loss of $8.4 million, or $0.18 per share.
Net income in the third quarter of 2014 included a tax benefit adjustment of $1.0 million. Third-quarter Adjusted EBITDA improved year-over-year to $21.2 million, or 11.5 percent of net sales, compared to $11.2 million, or 7.2 percent of net sales, in last year’s third quarter. As of September 30, 2014, Accuride had $21.5 million of cash plus $48.1 million in availability under its ABL Credit Facility, for total liquidity of $69.6 million.
Said President and CEO Rick Dauch, “Accuride delivered strong results for yet another quarter in 2014, as each of our business units achieved sustained organic growth and year-over-year improvements in operating income, net income and Adjusted EBITDA. Our results were supported by continued strength in all sectors of the North American commercial vehicle industry, as the solid pace of U.S. economic and industrial growth fueled a healthy freight market that is boosting fleet equipment orders. Achieving consecutive quarters of positive net income further demonstrates our ability to generate higher profitability as we grow sales across our leaner, more cost-efficient North American production assets.”
The North American commercial vehicle industry remained strong in the third quarter, reaching its 20th consecutive month of year-over-year Class 8 order improvement in September. The pace of demand drove backlogs up, as fleets ordered to lock in OEM build slots to ensure that their future equipment needs are met. As a result, Class 8, Class 5-7 and trailer production posted year-over-year increases of 25 percent, 13 percent, and 19 percent, respectively.
Class 8 net orders were up 43 percent year-over-year, as solid fleet profitability and residual values for used Class 8 equipment spurred replacement of aging equipment. Class 8 net orders should remain strong for the next two quarters as the industry begins its year-end equipment buying season and moves into 2015.
Year to date, trailer segment net orders are up 50 percent over 2013, and trailer OEMs expect the strong demand to continue for the next several quarters. Trailer production is projected to increase by 29 percent year-over-year in Q4 2014 and 21 percent in Q1 2015. Class 5-7 net orders also continue at a steady pace and are booking at an annualized rate of 212,200 units. Current expectations for Class 5-7 are for year-over-year growth of 2 percent in fourth quarter 2014 production and 4 percent in the first quarter of 2015.