Ampco-Pittsburgh(AP) - 2025 Q2 - Quarterly Results

Ampco-Pittsburgh Corporation Q2 2025 Earnings Release Financial Performance Summary Ampco-Pittsburgh reported Q2 2025 net sales of $113.1 million, swinging to an operating and net loss primarily due to a $6.8 million U.K. exit charge Overall Results (Q2 & H1 2025) The company reported a slight increase in Q2 2025 net sales but swung to an operating and net loss, primarily due to a U.K. exit charge | Financial Metric | Three Months Ended June 30, 2025 ($ in millions) | Three Months Ended June 30, 2024 ($ in millions) | Six Months Ended June 30, 2025 ($ in millions) | Six Months Ended June 30, 2024 ($ in millions) | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $113.1 | $111.0 | $217.4 | $221.2 | | (Loss) Income from Operations | ($3.1) | $5.0 | $0.8 | $5.1 | | Net (Loss) Income Attributable to Ampco-Pittsburgh | ($7.3) | $2.0 | ($6.2) | ($0.7) | | Diluted (Loss) Earnings Per Share | ($0.36) | $0.10 | ($0.31) | ($0.04) | - The Q2 2025 operating loss of $3.1 million was primarily driven by $6.8 million in costs associated with the exit of its U.K. cast roll operations[3] - Higher sales of forged engineered products and favorable foreign exchange translation were offset by weaker mill roll sales, while Air and Liquid Processing sales remained stable year-over-year[2] Adjusted EBITDA Adjusted EBITDA declined in Q2 2025 due to lower FCEP margins but improved year-to-date from ALP segment profitability | Period | Adjusted EBITDA ($ in millions) | Change from Prior Year ($ in millions) | | :--- | :--- | :--- | | Q2 2025 | $8.0 | -$2.1 | | H1 2025 | $16.8 | +$1.6 | - The decline in Q2 Adjusted EBITDA was attributed to lower margins in the Forged and Cast Engineered Products (FCEP) segment, which suffered from higher manufacturing costs, a weaker sales mix, and lower cost absorption[4] - The year-to-date improvement in Adjusted EBITDA was primarily due to improved profitability in the Air and Liquid Processing (ALP) segment[4] Management Commentary and Outlook Management noted Q2 volatility from U.S. tariffs impacting results and backlog, expecting improvement in 2026 post-U.K. exit - CEO Brett McBrayer stated that volatility from U.S. tariff actions negatively impacted results and the order book in Q2[5] - Backlog in the Forged and Cast Engineered Products segment declined 9% from March 31, 2025, as customers paused orders amid tariff uncertainty[5] - The company expects an improved environment in 2026 following the U.K. exit and greater clarity on trade policy[6] Strategic Business Updates The company is exiting its U.K. cast roll operations, incurring $6.8 million in Q2 2025 costs, expecting to improve annual operating income by at least $5 million U.K. Cast Roll Operations Exit The company recorded $6.8 million in Q2 2025 costs to exit its U.K. cast roll operations, anticipating at least $5 million annual earnings improvement - In Q2 2025, the company recorded expenses of $6.8 million for severance, accelerated depreciation, and other costs to exit its U.K. cast roll operations[3][5] - The exit is expected to improve annual earnings by at least $5 million[5][6] - The net loss for Q2 and H1 2025 includes the $6.8 million charge, which equates to $0.34 per share[9] Segment Performance FCEP segment profitability declined in Q2 2025 due to higher costs and weaker sales mix, while ALP segment profitability improved from a better sales mix Forged and Cast Engineered Products (FCEP) FCEP segment margins were negatively impacted by higher manufacturing costs, a weaker sales mix, and lower cost absorption - FCEP segment margins were negatively affected by higher manufacturing costs relative to pricing, a weaker sales mix, and lower manufacturing cost absorption[4] | FCEP Segment | Q2 2025 ($ in millions) | Q2 2024 ($ in millions) | | :--- | :--- | :--- | | Net Sales | $77.9 | $75.7 | | Adjusted Income from Operations | $6.8 | $9.8 | | Adjusted Margin from Operations | 11.16% | 12.96% | Air and Liquid Processing (ALP) The ALP segment's profitability improved primarily due to a better sales mix, despite a slight decrease in adjusted margin - The ALP segment's profitability improved primarily due to a better sales mix[4] | ALP Segment | Q2 2025 ($ in millions) | Q2 2024 ($ in millions) | | :--- | :--- | :--- | | Net Sales | $35.2 | $35.3 | | Adjusted Income from Operations | $3.9 | $3.4 | | Adjusted Margin from Operations | 8.68% | 9.69% | Financial Statements and Reconciliations Detailed financial tables present Q2 2025 consolidated net loss of $7.3 million and reconciliations from GAAP to non-GAAP measures, including Adjusted EBITDA Financial Summary (Consolidated) The consolidated financial summary shows a Q2 2025 net loss of $7.3 million, a significant shift from prior year net income Consolidated Financial Summary (in thousands) | Line Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total net sales | $113,104 | $110,988 | | (Loss) income from operations | $(3,078) | $5,043 | | Net (loss) income attributable to Ampco Pittsburgh | $(7,335) | $2,012 | | Diluted Net (loss) income per share | $(0.36) | $0.10 | Reconciliation of Net Income to Adjusted EBITDA This section reconciles GAAP net loss to Adjusted EBITDA, detailing adjustments for interest, taxes, depreciation, and exit costs Q2 Adjusted EBITDA Reconciliation (in thousands) | Line Item | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net (loss) income (GAAP) | $(6,720) | $2,552 | | Adjustments: | | | | Interest expense | $2,825 | $3,017 | | Other income – net | $225 | $(1,389) | | Income tax provision | $592 | $863 | | Depreciation and amortization | $5,368 | $4,698 | | Severance and other exit costs | $6,096 | $0 | | Employee retention credits | $(735) | $0 | | Stock-based compensation | $332 | $388 | | EBITDA, as adjusted (Non-GAAP) | $7,983 | $10,129 | Reconciliation of Income from Operations to Adjusted Income from Operations (by Segment) This reconciliation details segment-level adjustments from GAAP income from operations to adjusted income from operations Q2 Adjusted Income from Operations Reconciliation (in thousands) | Segment | (Loss) Income from Operations (GAAP) | Adjustments | Income from Operations, as adjusted (Non-GAAP) | | :--- | :--- | :--- | :--- | | FCEP | $(3,963) | $10,724 | $6,761 | | ALP | $3,922 | $(279) | $3,927 | | Corporate | $(3,037) | $332 | $(2,705) | | Consolidated | $(3,078) | $11,061 | $7,983 | Supplementary Information This section provides investor details, including conference call logistics, corporate overview, forward-looking statements disclaimer, and non-GAAP financial measures explanation Conference Call Information Details for the Q2 2025 financial results conference call are provided for investor access - A conference call to discuss Q2 2025 financial results was scheduled for Wednesday, August 13, 2025, at 10:30 a.m. Eastern Time (ET)[10] Non-GAAP Financial Measures Explanation This section explains the use of non-GAAP measures like Adjusted EBITDA to evaluate operating performance and identify trends - The company uses non-GAAP measures like Adjusted EBITDA and Adjusted Income from Operations to help management and investors evaluate operating performance and identify underlying business trends[18][19] - For Q2 2025, key adjustments from GAAP measures include the exclusion of severance and other exit costs related to the U.K. operations and the inclusion of employee-retention credits[17] Forward-Looking Statements The report contains forward-looking statements subject to various risks, including economic downturns and geopolitical conflicts - The report contains forward-looking statements regarding future performance, which are subject to various risks and uncertainties, including economic downturns, restructuring challenges, commodity price increases, and geopolitical conflicts[15]