Associated Materials eyes refinancing in 2016, ends 2015 with $925.5 million of long-term debt

By Lisa Kerner

Charlotte, N.C., March 24 – Associated Materials, LLC president and chief executive officer Brian Strauss said he is happy with the “significant” progress the company made in 2015.

“We battled significant foreign currency headwinds when compared to 2014,” Strauss said during the company’s fourth-quarter and full-year 2015 earnings call on Thursday.

Strauss said Associated Materials ended 2015 “in a much better place” compared to the beginning of the year and that 2016 is off to a good start.

The company ended the quarter on Jan. 2 with cash and cash equivalents of $9.4 million and available borrowing capacity of $55.8 million under its ABL facilities, said chief financial officer Scott Stephens on the call.

Long-term debt totaled about $925.5 million at Jan. 2.

This compares to cash and cash equivalents of about $6 million and long-term debt of about $903 million at the end of 2014, according to a form 10-K filed with the Securities and Exchange Commission.

Associated Materials long-term debt includes $830 million of 9.125% notes due Nov. 1, 2017 and $92.8 million in borrowings outstanding under the ABL facilities.

“We expect to turn our attention to the future bond maturities and financing opportunities as we work through 2016,” Stephens said on the call.

The company amended its ABL revolver in February.

Net cash used by operating activities was $3.4 million for 2015, compared to a cash use of 71 million for 2014, said Stephens.

The increase was driven by improved operating earnings of $37.9 million and improvements in working capital.

Net sales for the fourth quarter were down 7.3% year over year, while gross profit as a percent of sales improved by 470 basis points in the period, according to Stephens.

Full-year net sales were down less than 1% year over year at about $1.19 billion.

Gross profit for the full year improved by 280 bps to $276.2 million.

Cuyahoga Falls, Ohio-based Associated Materials manufactures and distributes exterior residential building products.

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