NORTH CANTON, Ohio,
Sept. 8, 2014 /PRNewswire/ -- The
Timken Company today announced that it is taking multiple actions
to improve the performance of its Aerospace business.
The company plans to:
- Eliminate its aerospace segment leadership positions and
integrate aerospace activities under the direction of Chris Coughlin, executive vice president and
group president;
- Close its aerospace engine overhaul business, located in
Mesa, Arizona, by the end of the
year;
- Evaluate strategic alternatives for its aerospace MRO parts
business, also located in Mesa;
and
- Close its aerospace bearing facility located in Wolverhampton, U.K., subject to the employee
consultation process, rationalizing the capacity into existing
facilities, with timing to be determined.
As a result of these changes, beginning with fourth quarter of
2014, Timken will no longer report Aerospace financial results
separately but rather will incorporate aerospace business results
primarily within the company's Mobile Industries segment.
In the third quarter of 2014, Timken expects to record a
non-cash charge of $110 to $120
million (pre-tax) comprised primarily of goodwill and
inventory impairments. In addition, cash charges related to
the facility closures are expected to be less than $10 million
(pre-tax), primarily consisting of severance, and will be recorded
as incurred. The above actions are expected to have
negligible impact on the company's 2015 revenues, with Mobile
Industries EBIT margins for 2015 targeted in the previously
communicated 10 to 13 percent range.
"Aerospace has been and will continue to be an important market
for Timken," said Richard G. Kyle,
Timken president and CEO. "It fits the Timken Business Model well
and we will continue to pursue challenging applications that value
our technology and our service.
"While the segment's overall performance has been weak, we
expect that the actions we've outlined will improve returns and
generate growth going forward," Kyle said. "We remain
committed to creating value for customers in the aerospace industry
and are confident that our efforts will improve the strength of our
business for both customers and shareholders going forward."
About The Timken Company
The Timken Company (NYSE:
TKR; www.timken.com) engineers, manufactures and markets
Timken® bearings, transmissions, gearboxes, chain, and
related products, and offers a spectrum of power system rebuild and
repair services around the world. The leading authority on
tapered roller bearings, Timken today applies its deep knowledge of
metallurgy, tribology and power transmission across the broad
spectrum of bearings and related systems to improve the reliability
and efficiency of machinery and equipment all around the
world. Known for its quality products and collaborative
technical sales model, Timken posted $3
billion in sales in 2013 (excluding Steel business sales.)
With approximately 17,000 people operating from 28 countries,
Timken makes the world more productive and keeps industry in
motion.
Certain statements in this release (including statements
regarding the company's estimates and expectations) that are not
historical in nature are "forward-looking" statements within the
meaning of the Private Securities Litigation Reform Act of 1995. In
particular, the statements regarding the company's expectations for
the performance and outlook of its aerospace business and its
Mobile Industries segment and the amount and timing of cash and
non-cash charges related to the restructuring are forward-looking.
The company cautions that actual results may differ materially from
those projected or implied in forward-looking statements due to a
variety of important factors, including: severance costs that
differ from original estimates due to the nature and timing of
employee terminations; and amounts for non-cash charges relating to
inventory and other assets that differ from the original estimates
based on the final fair value determinations. Additional
factors are discussed in the company's filings with the Securities
and Exchange Commission, including the company's Annual Report on
Form 10-K for the year ended Dec. 31, 2013, quarterly reports
on Form 10-Q and current reports on Form 8-K. Except as required by
the federal securities laws, the company undertakes no obligation
to publicly update or revise any forward-looking statement, whether
as a result of new information, future events or
otherwise.
Media
Contact:
Gloria
Irwin
Communications
Manager
4500 Mount Pleasant
St. N.W.
North Canton, OH
44720 U.S.A.
Telephone:
234.262.3514
mediarelations@timken.com
|
Investor
Contact:
Steve
Tschiegg
Director – Capital
Markets & Investor Relations
4500 Mount Pleasant
St. N.W.
North Canton, OH
44720 U.S.A.
Telephone:
234.262.7446
steve.tschiegg@timken.com
|
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SOURCE The Timken Company