Horizon Global has reported its financial results for the second quarter of 2019, showing that net sales decreased $10.2 million, or 4.4 percent, to $223.2 million from the previous year comparable period. The decrease was mainly attributable to unfavorable foreign currency translation.
Meanwhile, the company reported an operating profit of $7.1 million, or 3.2 percent of net sales, an improvement of $71.2 million over the previous year comparable period, primarily due to a $55.7 million goodwill impairment charge recorded in second quarter 2018.
“We experienced a slow start to the year, which continued in the second quarter, resulting in a modest decrease in sales, but our team remains focused on returning Horizon Global to its historical performance levels,” said Carl Bizon, president and CEO. “In addition to foreign currency headwinds, our results were also impacted by the continuing uncertainty surrounding tariffs and their impact on the entire global supply chain. We have been consistent in our efforts to recover the costs associated with tariffs and the timing may not be immediate. In this environment, it is important that we remain flexible and responsive to the ever-evolving conditions as we work to overcome short-term issues and set the stage for stronger performance over the long term.”
Net sales for the quarter for Horizon Americas were essentially flat at $108.9 million. E-commerce and OE net sales increased $4.9 million and $3.9 million, respectively, while net sales in the retail, aftermarket and industrial channels slowed, and were $7.6 million lower than the prior year comparable period on a combined basis. Management believes the slow start to the prime selling season was caused by unusually wet and cold weather in parts of the country, which was a contributing factor to results in the quarter.
As a result, adjusted operating profit decreased to $9.8 million, or 9 percent of net sales, as compared to $10.6 million, or 9.8 percent of net sales, during the previous year comparable period.
“The Americas continued to hold its own and our Europe-Africa team made progress on its ongoing business improvement initiatives,” said Bizon. “From a macro perspective, the broader European market has been relatively stable, with some pockets of softening demand related mainly to the U.K. market and uncertainty surrounding Brexit, and in what has become a common and recurring theme, our Asia-Pacific segment continued to deliver incredibly strong margins.”
