Xerium Technologies, Inc., a leading global provider of industrial consumable products and services, announced its Q1 2014 results.

 

Q1 2014 roll sales were weaker than expected in North America and Europe

Weather conditions and a market inventory correction in containerboard drove weaker than expected roll sales in the quarter in North America and Europe. We expected and planned for sales to be weak, and they were. We believe these market conditions were temporary, and indeed orders were as expected in the quarter, growing 5.8% to $146.0 million. 

 

Rolls sales were in line in the rest of the world, outside North America and Europe. Constant currency machine clothing sales declined 0.9%, while machine clothing Adjusted EBITDA increased from $18.1 million in Q1 2013 to $19.1 million in Q1 2014.

 

2014 Full Year Adjusted EBITDA guidance of $116 - $120 million remains on track

The Company is reducing its costs at the same time that it repositions its commercial programs and capacities to mirror growth opportunities geographically and by product. These plans are on track and are back-end loaded in 2014. We see the same amount of upside and downside to our business. Furthermore, we expect to pay down some debt in the second half of 2014.

 

The Company's sales growth and cost reduction programs are on track to deliver expected results for the year

The Company is underway with a balanced program of sales growth and cost reduction. The cost reduction programs are comprised of a plant repositioning program and operational excellence programs. The plant repositioning program will dramatically reposition our assets to mirror forward growth activities – geographically and by product type – and at the same time increase our competitiveness by being leaner and more nimble.

 

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