Coleman Cable, Inc. Announces Record Third-Quarter 2013 Results, Including Adjusted EPS of $0.40 and Adjusted EBITDA of $24.0 Million

WAUKEGAN, Ill., Nov. 7, 2013 (GLOBE NEWSWIRE) -- Coleman Cable, Inc. (Nasdaq:CCIX) (the "Company," "Coleman," "we," "us," or "our"), a leading manufacturer and innovator of electrical and electronic wire and cable products, announced third-quarter 2013 financial results.

Highlights

• Third-quarter 2013 Adjusted Earnings Per Share (EPS) of $0.40, a third-quarter record for the Company.
• Third-quarter 2013 Adjusted EBITDA of $24.0 million, a third-quarter record for the Company.
• Third-quarter and first nine-month 2013 Adjusted EPS growth of 8.1 percent and 16.8 percent, respectively, versus the same periods last year.

Outlook and Dividend

• For the fourth quarter of 2013, the Company estimates sales between $225.0 million and $250.0 million and Adjusted EPS between $0.36 and $0.49.
• Declared quarterly cash dividend of $0.05 per share payable on November 29, 2013, to stockholders of record as of the close of business on November 15, 2013.

Third-Quarter 2013 Results

Net sales for the third quarter of 2013 were $229.0 million, consistent with $229.3 million of net sales for the third quarter of 2012. Sales volume (measured in total pounds shipped, on a comparable basis) increased 4.2 percent for the third quarter of 2013 compared to the same period last year, while copper prices declined 8.5 percent on a year-over-year basis. Compared to last year, the Company's sales results in the 2013 third quarter mainly reflect higher sales within the Company's Engineered Solutions and Distribution segments, offset by lower sales in its OEM segment. 

President and CEO Gary Yetman stated, "For the third quarter of 2013, both our Adjusted EBITDA and Adjusted EPS were third-quarter records for the Company, while our Adjusted EBITDA results marked the fourth consecutive quarter of record results dating back to last year. Further, our results include total volume growth of 4.2 percent driven by increased demand across a variety of products, particularly within industrial and construction-related categories. Our strong third-quarter performance continues to reflect the diversity of our business and the strength of our operating platform, which have allowed us to achieve strong results notwithstanding copper price volatility and the negative impact of the sequestration on TRC's military business in our Engineered Solutions segment." 

Mr. Yetman concluded, "We have been encouraged by double-digit demand growth from our construction-related products during the third quarter. This growth, along with the introduction of our newer industrial products, has us well-positioned to finish what has already been a strong year of financial results." 

On a GAAP basis, the Company recorded earnings of $0.8 million, or $0.04 per diluted share, for the third quarter of 2013 compared to $5.5 million, or $0.31 per diluted share, for the third quarter last year. For the third quarter of 2013, the Company's GAAP results include a pre-tax, non-cash goodwill impairment charge of $6.6 million, or $0.36 per diluted share, recorded as the result of an interim goodwill impairment test performed during the 2013 third quarter on TRC's military business. As a result of this test, a non-cash impairment charge was required to reduce the carrying value of the goodwill associated with TRC's military business. Since the conclusion of 2012, the Company has operated this business amidst a general uncertainty involving the timing and amount of U.S. military spending. This charge has no impact on the Company's operating cash flow, liquidity, or debt covenant compliance. GAAP results for the 2013 period also include restructuring charges and share-based compensation expense. These items are excluded from the Company's Adjusted EBITDA and Adjusted EPS results. Please see the discussion of Non-GAAP results below and the attached schedules for a full reconciliation of GAAP results to non-GAAP results.

Quarterly Cash Dividend

On November 5, 2013, Coleman's board of directors declared a quarterly cash dividend of $0.05 per share payable on November 29, 2013, to stockholders of record as of the close of business on November 15, 2013. Future declarations of quarterly dividends are subject to approval of the board of directors and may be adjusted as business needs or market conditions change.

Webcast

Coleman Cable has scheduled its conference call for Friday, November 8, 2013, at 10:00 a.m. Central time. Hosting the call will be Gary Yetman, President and CEO, and Alan Bergschneider, Executive Vice President and CFO. A live broadcast of the Company's conference call, along with accompanying visuals, will be available on-line through the Company's Web site at http://investors.colemancable.com/events.cfm. The webcast will be archived for 90 days.

Non-GAAP Results

In addition to net income determined in accordance with GAAP, we use certain non-GAAP measures in assessing our operating performance. These non-GAAP measures used by management include: (1) EBITDA, which we define as net income before net interest, income taxes, depreciation and amortization expense ("EBITDA"), (2) Adjusted EBITDA, which is our measure of EBITDA adjusted to exclude the impact of certain specifically identified items ("Adjusted EBITDA"), and (3) Adjusted EPS, which we calculate as diluted earnings per share adjusted to exclude the estimated per share impact of the same specifically identified items used to calculate Adjusted EBITDA. For the periods presented in this report, the specifically identified items include asset impairment, restructuring charges, share-based compensation expense, and acquisition-related costs.

We believe both EBITDA and Adjusted EBITDA, when presented in conjunction with comparable GAAP measures, are useful for investors because we use that information in evaluating the performance of our business. We use these measures in the preparation of our annual operating budgets and serve as an indicator of business performance and management's effectiveness with specific references to these indicators. We believe both EBITDA and Adjusted EBITDA allow us to readily view operating trends, perform analytical comparisons and identify strategies to improve operating performance. The usefulness of EBITDA and Adjusted EBITDA as performance measures is limited by the fact that they both exclude the impact of interest expense, depreciation and amortization expense, and taxes. Due to these limitations, we do not, and you should not, use either EBITDA or Adjusted EBITDA as the only measures of our performance. We also use, and recommend that you consider, net income in accordance with GAAP as a measure of our performance. Finally, other companies may define EBITDA and Adjusted EBITDA differently and, as a result, our measure of EBITDA and Adjusted EBITDA may not be directly comparable to EBITDA and Adjusted EBITDA measures of other companies.

Similarly, we believe our use of Adjusted EPS provides an appropriate measure to use in assessing our performance across periods given that this measure provides an adjustment for certain significant items, the magnitude of which may vary significantly from period to period. However, we do not, and do not recommend that you solely use Adjusted EPS to assess our financial and earnings performance. We also use, and recommend that you use, diluted earnings per share in addition to Adjusted EPS in assessing our earnings performance. Finally, other companies may define Adjusted EPS differently and, as a result, our measure of Adjusted EPS may not be directly comparable to Adjusted EPS measures of other companies.

About Coleman Cable, Inc.

Coleman Cable, Inc. is a leading manufacturer and innovator of electrical and electronic wire and cable products for residential and commercial construction, industrial, OEM, and consumer applications, with operations in the United States, Honduras, and Canada.  The Company's broad product offering enables it to provide its customers a single source for many of their wire and cable requirements.  It manufactures the majority of its products in nine domestic production facilities and sells products to more than 8,000 active customers in a wide variety of end markets.  It operates three segments:  Distribution, OEM, and Engineered Solutions.  For more information, visit www.colemancable.com.

Various statements included in this release, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact constitute forward-looking statements. These statements include those made under "Outlook and Dividend" and also may be identified by the use of forward-looking terminology such as "believes," "plans," "anticipates," "expects," "estimates," "continues," "could," "may," "might," "potential," "predict," "should," or the negative thereof or other variations thereon or comparable terminology. In particular, statements about Coleman Cable's expectations, beliefs, plans, objectives, assumptions or future events, financial results, earnings guidance or financial performance contained in this release are forward-looking statements.  Coleman Cable has based these forward-looking statements on its current expectations, assumptions, estimates and projections.  While Coleman Cable believes these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors, including those discussed in Coleman Cable's most recent Annual Report on Form 10-K (available at www.sec.gov), may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Some of the key factors that could cause actual results to differ from Coleman Cable's expectations include:

•  fluctuations in the supply or price of copper and other raw materials, including PVC and fuel;
• increased competition from other wire and cable manufacturers, including foreign manufacturers;
• pricing pressures causing margins to decrease;
• our dependence on indebtedness and our ability to satisfy our debt obligations;
• failure to identify, finance or integrate acquisitions;
• product liability claims and litigation resulting from the design or manufacture of our products;
• advancements in wireless technology;
• impairment charges related to our goodwill and long-lived assets;
• restructuring charges;
• changes in the cost of labor;
• disruption in the importation of raw materials and products from foreign-based suppliers;
• our ability to maintain substantial levels of inventory;
• increase in exposure to political and economic development, crises, instability, terrorism, civil  strife, expropriation, and other risks of doing business in foreign markets;
• changes in tax legislation relating to our Honduras subsidiary; and
• other risks and uncertainties, including those described under "Item 1A. Risk Factors," in Coleman Cable's most recent Annual Report on Form 10-K.

In addition, any forward-looking statements represent Coleman's views only as of today and should not be relied upon as representing its views as of any subsequent date. While Coleman may elect to update forward-looking statements at some point in the future, it specifically disclaims any obligation to do so, even if its estimates change and, therefore, you should not rely on these forward-looking statements as representing Coleman's views as of any date subsequent to today.

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