To consider strategic initiatives

Tecumseh Products Company announced consolidated earnings results for the first quarter ended March 31, 2013. Interest income was $0.3 million in the first quarter of 2013 compared to $0.8 million in the first quarter of 2012, primarily due to a decline in the interest rate on a judicial deposit in Brazil that is being held in an interest bearing court appointed cash account. Net loss from continuing operations for the quarter ended March 31, 2013 was $7.5 million, or $0.40 per share, as compared to a net loss from continuing operations of $6.4 million, or $0.34 per share, in the same period of 2012. In the first three months of 2013, cash used in operations was $10.2 million as compared to $9.7 million of cash used in operations in the first three months of 2012. Operating loss was $5.4 million and a net loss of $8.4 million, or $0.45 per share, on net sales of $207.6 million for the quarter ended March 31, 2013. This compares with an operating loss of $5.9 million and a net loss of $7.1 million, or $0.38 per share, on net sales of $219.6 million for 2012. EBITDAR from continuing operations was $7.3 million against $4.9 million a year ago. EBITDA from continuing operations was $3.9 million against $3.7 million a year ago. Included in the company's net income is a non-recurring, non-cash postretirement benefit curtailment gain of $45.0 million. Excluding the decrease in sales due to the effect of changes in foreign currency translation of $8.1 million, net sales decreased by 1.8% compared to the first quarter of 2012, primarily due to net volume and mix decreases, partially offset by price increases. As the company looks specifically to the second quarter of 2013, the company expects sales and operating profit to be slightly improved over the second quarter of 2012 and negative operating cash flow resulting from higher inventory levels it discussed previously. For 2013, the company currently expects net sales to increase in the range of 3% to 8% from 2012 levels. The potential improvement is based on internal projections about the market and related economic conditions, expected price increases to customers, estimated foreign currency exchange rate effects, as well as continued efforts in sales and marketing. The company expects that the full year 2013 operating profit could improve compared to 2012, exclusive of the $45.0 million curtailment gain on postretirement benefits recognized in 2012, if are successful at offsetting volatility in commodity costs and foreign exchange rates, and implementing initiatives for re-engineering product lines to reduce costs, price increases, restructuring activities and other cost reductions. The company also expects that operating cash flow could be sufficient to maintain current cash balances and fund ongoing business requirements if are successful at achieving the improved operating profit and the tax authorities do not significantly change their pattern of payments or past practices for the expected outstanding refundable Brazilian and Indian non-income taxes. Furthermore, the company expects capital spending in 2013 to be approximately $20.0 million to $25.0 million.

Tecumseh Products Company, Q1 2013 Earnings Call, May 07, 2013