ain-20231106
216 Airport DriveRochesterNew HampshireFALSE0000819793NYSENYSE00008197932023-11-062023-11-060000819793ain:ClassACommonStockMember2023-11-062023-11-060000819793ain:ClassBCommonStockMember2023-11-062023-11-06

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report:    November 6, 2023
(Date of earliest event reported)
ALBANY INTERNATIONAL CORP.
(Exact name of registrant as specified in its charter)
Delaware
1-10026
14-0462060
(State or other jurisdiction
of incorporation)
(Commission
File Number)
(I.R.S Employer
Identification No.)
216 Airport Drive Rochester, New Hampshire
03867
(Address of principal executive offices)
(Zip Code)
Registrant’s telephone number, including area code       603-330-5850
None
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of each exchange
on which registered
Class A Common Stock, $0.001 par value per share
AIN
The New York Stock Exchange (NYSE)
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act 1933 (230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (240.12b-2 of this chapter).
    Emerging growth company
¨    If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act





Item 2.02.  Results of Operations and Financial Condition.
On November 6, 2023 Albany International issued a news release reporting third quarter 2023 financial results. The Company will host a webcast to discuss earnings at 10:00 a.m. Eastern Time on Tuesday November 7, 2023. The news release is furnished as Exhibit 99.1 to this report.
Item 9.01. Financial Statements and Exhibits.
(d)    Exhibits. The following exhibit is being furnished herewith:
99.1    News release dated November 6, 2023 reporting third-quarter 2023 financial results.



Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
ALBANY INTERNATIONAL CORP.
By:
/s/ Robert D. Starr
Name:
Robert D. Starr
Title:
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
Date: November 6, 2023


EXHIBIT INDEX
Exhibit No.
Description
99.1
104
Inline XBRL cover page.





Exhibit 99.1

https://cdn.kscope.io/22950ce4cf7d593bc340558198c15232-image.jpg
Albany International Reports Third-Quarter 2023 Results
ROCHESTER, N.H.--(BUSINESS WIRE)--November 6, 2023 — Albany International Corp. (NYSE:AIN) today reported operating results for its third quarter of 2023, which ended September 30, 2023.

"We are reporting another strong quarter," said President and CEO, Gunnar Kleveland. "Revenue of $281 million, was up $20 million or 7.9% year-over-year primarily due to sales growth in Engineered Composites and one month of Heimbach results in the Machine Clothing segment. Both business segments are continuing to deliver on their long-term plans for profitable growth.

"In Machine Clothing, we closed on our acquisition of Heimbach on August 31 and welcome the Heimbach employees and customers to Albany. We are focused on integrating the operations and expect the acquisition to be accretive to earnings and cash flow in 2025. Machine Clothing delivered excellent results, particularly in light of the macroeconomic conditions in both Europe and China.

"Engineered Composites is executing on its long-term growth strategy delivering top-line growth across commercial, defense and space markets. The new business pipeline is robust, and I am excited about the opportunities it represents.

"Our revised guidance takes into account our year-to-date performance, anticipated market conditions, and the modestly dilutive impact of the Heimbach acquisition," concluded Kleveland.


For the third quarter ended September 30, 2023:
Net revenues were $281.1 million, up 7.9%, or 7.1% after adjusting for currency translation, when compared to the prior year. MC's net revenues increased 8.6%, driven by Heimbach Net revenues and, to a lesser extent, higher Net revenues in tissue and packaging grades, offset by lower Net revenues in pulp and engineered fabrics. AEC's Net revenues increased 6.9%, primarily driven by growth on LEAP programs, the Boeing Frames program, and other commercial programs, offset by lower CH-53K sales.
Gross profit of $101.8 million was 1.3% higher than the $100.5 million reported for the same period of 2022; overall gross margin declined by more than 200 basis points, driven by lower margins at Heimbach and by an unfavorable shift in program revenue mix at AEC.
Selling, Technical, General, and Research (STG&R) expenses were $61.7 million, compared to $46.8 million in the same period of 2022; the increase was driven by executive transition costs, acquisition-related expenses, higher personnel-related costs, and unfavorable changes to currency translation rates.
Operating income was $40.1 million, compared to $53.6 million in the prior year, the result of higher STG&R expenses as described.
Effective tax rate for the quarter was 25.3%, compared to -41.7% for the third quarter of 2022. The prior year tax rate was driven by the release of residual taxes as a result of the pension settlement at that time; excluding the effect of the pension settlement and related adjustments, the effective tax rate for the third quarter of 2022 was 24.6%.
Net income attributable to the Company was $27.1 million ($0.87 per share), compared to $10.7 million ($0.34 per share) in the third quarter of 2022; Adjusted earnings per share (or Adjusted EPS, a non-GAAP measure) was $1.02 per share, compared to $1.15 per share for the same period last year.
Adjusted EBITDA (a non-GAAP measure) was $64.7 million, compared to $68.1 million in the third quarter of 2022, a decrease of 4.9%.

Please see the tables below for a reconciliation of non-GAAP measures to their comparable GAAP measures.





Outlook for Full-Year 2023
The Company has updated its guidance for the full year of 2023 as follows:
Total company revenue between $1.100 and $1.130 billion, up $60 million;
Effective income tax rate, including tax adjustments, between 32% and 33%, implying an effective tax rate between 28% and 30% for the fourth quarter of 2023;
Total company depreciation and amortization approximately $75 million;
Capital expenditures in the range of $85 to $95 million;
GAAP earnings per share between $3.02 and $3.37, taking into account $0.14 to $0.18 of dilution from the Heimbach acquisition; largely the result of purchase accounting;
Adjusted earnings per share between $3.35 and $3.70, up $0.08 per share at the midpoint, and includes $0.02 to $0.06 of dilution from Heimbach;
Total company Adjusted EBITDA between $238 and $254 million;
Machine Clothing revenue between $660 and $670 million, increasing approximately $50 million, including the estimated contribution from Heimbach;
Machine Clothing Adjusted EBITDA between $215 and $225 million, inclusive of approximately $2 million from the Heimbach acquisition;
Albany Engineered Composites (AEC) revenue between $440 and $460 million, up $10 million; and
Albany Engineered Composites Adjusted EBITDA between $85 and $90 million, up modestly at the midpoint.



ALBANY INTERNATIONAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
(unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2023202220232022
Net revenues$281,106 $260,563 $824,325 $766,101 
Cost of goods sold179,271 160,070 520,468 473,411 
Gross profit101,835 100,493 303,857 292,690 
Selling, general, and administrative expenses51,975 36,873 147,214 119,325 
Technical and research expenses9,708 9,934 30,303 29,984 
Restructuring expenses, net82 42 227 268 
Operating income40,070 53,644 126,113 143,113 
Interest expense/(income), net3,653 3,794 10,049 11,336 
Pension settlement expense— 49,128 — 49,128 
Other (income)/expense, net56 (6,918)(4,910)(17,891)
Income before income taxes36,361 7,640 120,974 100,540 
Income tax expense/(benefit)9,207 (3,183)39,908 22,273 
Net income27,154 10,823 81,066 78,267 
Net income attributable to the noncontrolling interest45 129 396 635 
Net income attributable to the Company$27,109 $10,694 $80,670 $77,632 
Earnings per share attributable to Company shareholders - Basic$0.87 $0.34 $2.59 $2.47 
Earnings per share attributable to Company shareholders - Diluted$0.87 $0.34 $2.58 $2.46 
Shares of the Company used in computing earnings per share:
Basic31,185 31,111 31,163 31,416 
Diluted31,283 31,223 31,256 31,518 
Dividends declared per Class A share$0.25 $0.21 $0.75 $0.63 



ALBANY INTERNATIONAL CORP.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
(unaudited)
September 30, 2023December 31, 2022
ASSETS
Cash and cash equivalents$171,506 $291,776 
Accounts receivable, net270,487 200,018 
Contract assets, net165,833 148,695 
Inventories180,991 139,050 
Income taxes prepaid and receivable6,402 7,938 
Prepaid expenses and other current assets61,155 50,962 
Total current assets$856,374 $838,439 
Property, plant and equipment, net566,974 445,658 
Intangibles, net44,636 33,811 
Goodwill177,398 178,217 
Deferred income taxes15,284 15,196 
Noncurrent receivables, net25,300 27,913 
Other assets104,284 103,021 
Total assets$1,790,250 $1,642,255 
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable$70,105 $69,707 
Accrued liabilities135,343 126,385 
Current maturities of long-term debt27,246 — 
Income taxes payable10,103 15,224 
Total current liabilities242,797 211,316 
Long-term debt463,339 439,000 
Other noncurrent liabilities141,620 108,758 
Deferred taxes and other liabilities20,861 15,638 
Total liabilities868,617 774,712 
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Preferred stock, par value $5.00 per share; authorized 2,000,000 shares; none issued— — 
Class A Common Stock, par value $.001 per share; authorized 100,000,000 shares; 40,856,910  issued in 2023 and 40,785,434 in 202241 41 
Additional paid in capital446,470 441,540 
Retained earnings988,602 931,318 
Accumulated items of other comprehensive income:
Translation adjustments(151,177)(146,851)
Pension and postretirement liability adjustments(17,389)(15,783)
Derivative valuation adjustment12,957 17,707 
Treasury stock (Class A), at cost; 9,661,845 shares in 2023 and 9,674,542 shares in 2022(364,665)(364,923)
Total Company shareholders' equity914,839 863,049 
Noncontrolling interest6,794 4,494 
Total equity921,633 867,543 
Total liabilities and shareholders' equity$1,790,250 $1,642,255 



ALBANY INTERNATIONAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Nine Months Ended September 30,
20232022
OPERATING ACTIVITIES
Net income$81,066 $78,267 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation50,164 46,864 
Amortization4,614 5,044 
Change in deferred taxes and other liabilities(1,264)(15,582)
Impairment of property, plant, equipment, and inventory577 2,610 
Non-cash interest expense1,148 840 
Non-cash portion of pension settlement expense— 42,657 
Compensation and benefits paid or payable in Class A Common Stock5,189 3,282 
Provision for credit losses from uncollected receivables and contract assets641 885 
Foreign currency remeasurement (gain) on intercompany loans(4,704)(6,629)
Fair value adjustment on foreign currency options581 (409)
Changes in operating assets and liabilities that provided/(used) cash, net of impact of business acquisition:
Accounts receivable(18,172)(20,260)
Contract assets(16,550)(37,201)
Inventories(293)(24,895)
Prepaid expenses and other current assets(3,030)(2,733)
Income taxes prepaid and receivable1,597 (2,179)
Accounts payable(6,661)5,081 
Accrued liabilities(16,454)(12,624)
Income taxes payable(5,810)2,639 
Noncurrent receivables2,276 2,976 
Other noncurrent liabilities(3,602)(5,960)
Other, net2,499 4,634 
Net cash provided by operating activities73,812 67,307 
INVESTING ACTIVITIES
Purchase of business, net of cash acquired(133,470)— 
Purchases of property, plant and equipment(48,850)(50,948)
Purchased software(276)(1,884)
Net cash used in investing activities(182,596)(52,832)
FINANCING ACTIVITIES
Proceeds from borrowings71,249 145,000 
Principal payments on debt(51,479)(48,000)
Principal payments on finance lease liabilities— (654)
Debt acquisition costs(4,108)— 
Purchase of Treasury shares— (84,780)
Taxes paid in lieu of share issuance(3,136)(770)
Proceeds from options exercised— 17 
Dividends paid(23,365)(19,932)
Net cash used in financing activities(10,839)(9,119)
Effect of exchange rate changes on cash and cash equivalents(647)(30,910)
Decrease in cash and cash equivalents(120,270)(25,554)
Cash and cash equivalents at beginning of period291,776 302,036 
Cash and cash equivalents at end of period$171,506 $276,482 





The following table presents the reconciliation of Net revenues to net revenues excluding the effect of changes in currency translation rates, a non-GAAP measure:
(in thousands, except percentages)Net revenues as reported, Q3 2023Increase due to changes in currency translation ratesQ3 2023 revenues on same basis as Q3 2022 currency translation ratesNet revenues as reported, Q3 2022% Change compared to Q3 2022, excluding currency rate effects
Machine Clothing$166,588 $662 $165,926 $153,389 8.2 %
Albany Engineered Composites114,518 1,275 113,243 107,174 5.7 %
Consolidated total$281,106 $1,937 $279,169 $260,563 7.1 %
(in thousands, except percentages)Net revenues as reported, YTD 2023(Decrease)/ increase due to changes in currency translation ratesYTD 2023 revenues on same basis as 2022 currency translation ratesNet revenues as reported, YTD 2022% Change compared to 2022, excluding currency rate effects
Machine Clothing$479,027 $(3,684)$482,711 $459,121 5.1 %
Albany Engineered Composites345,298 851 344,447 306,980 12.2 %
Consolidated total$824,325 $(2,833)$827,158 $766,101 8.0 %


The following table presents Gross profit and Gross profit margin:
(in thousands, except percentages)Gross profit,
Q3 2023
Gross profit margin, Q3 2023Gross profit,
Q3 2022
Gross profit margin, Q3 2022
Machine Clothing$79,257 47.6 %$79,232 51.7 %
Albany Engineered Composites22,578 19.7 %21,261 19.8 %
Consolidated total$101,835 36.2 %$100,493 38.6 %
(in thousands, except percentages)Gross profit,
YTD 2023
Gross profit margin, YTD 2023Gross profit,
YTD 2022
Gross profit margin, YTD 2022
Machine Clothing$238,031 49.7 %$237,434 51.7 %
Albany Engineered Composites65,826 19.1 %55,256 18.0 %
Consolidated total$303,857 36.9 %$292,690 38.2 %





A reconciliation from Net income/(loss) (GAAP) to Adjusted EBITDA (non-GAAP) for the current-year and comparable prior-year periods has been calculated as follows:
Three months ended September 30, 2023
(in thousands)Machine ClothingAlbany Engineered
Composites
Corporate expenses
and other
Total Company
Net income/(loss) (GAAP)$50,710 $9,374 $(32,930)$27,154 
Interest expense/(income), net— — 3,653 3,653 
Income tax expense— — 9,207 9,207 
Depreciation and amortization expense5,976 12,510 975 19,461 
EBITDA (non-GAAP)56,686 21,884 (19,095)59,475 
Restructuring expenses, net82 — — 82 
Foreign currency revaluation (gains)/losses (a)(656)19 516 (121)
CEO transition expenses— — 2,052 2,052 
Inventory step-up impacting Cost of goods sold1,370 — — 1,370 
Acquisition/integration costs— 273 1,642 1,915 
Pre-tax (income) attributable to noncontrolling interest — (73)— (73)
Adjusted EBITDA (non-GAAP)$57,482 $22,103 $(14,885)$64,700 
Adjusted EBITDA margin (Adjusted EBITDA divided by Net revenues) (non-GAAP)34.5 %19.3 % 23.0 %
Three months ended September 30, 2022
(in thousands)Machine ClothingAlbany Engineered
Composites
Corporate expenses
and other
Total Company
Net income/(loss) (GAAP)$57,247 $9,958 $(56,382)$10,823 
Interest expense/(income), net— — 3,794 3,794 
Income tax benefit— — (3,183)(3,183)
Depreciation and amortization expense4,913 11,303 818 17,034 
EBITDA (non-GAAP)62,160 21,261 (54,953)28,468 
Restructuring expenses, net42 — — 42 
Foreign currency revaluation (gains)/losses (a)(2,931)122 (6,633)(9,442)
Dissolution of business relationships in Russia(214)— — (214)
Pension settlement expense— — 49,128 49,128 
Acquisition/integration costs— 255 — 255 
Pre-tax (income) attributable to noncontrolling interest— (176)— (176)
Adjusted EBITDA (non-GAAP)$59,057 $21,462 $(12,458)$68,061 
Adjusted EBITDA margin (Adjusted EBITDA divided by Net revenues) (non-GAAP)38.5 %20.0 % 26.1 %



Nine months ended September 30, 2023
(in thousands)Machine ClothingAlbany Engineered
Composites
Corporate expenses
and other
Total Company
Net income/(loss) (GAAP)$153,400 $27,460 $(99,794)$81,066 
Interest expense/(income), net— — 10,049 10,049 
Income tax expense— — 39,908 39,908 
Depreciation and amortization expense15,682 36,246 2,850 54,778 
EBITDA (non-GAAP)169,082 63,706 (46,987)185,801 
Restructuring expenses, net227 — — 227 
Foreign currency revaluation (gains)/losses (a)1,870 19 (3,609)(1,720)
CEO transition expenses— — 2,052 2,052 
Inventory step-up impacting Cost of goods sold1,370 — — 1,370 
Acquisition/integration costs— 813 2,005 2,818 
Pre-tax (income) attributable to noncontrolling interest — (474)— (474)
Adjusted EBITDA (non-GAAP)$172,549 $64,064 $(46,539)$190,074 
Adjusted EBITDA margin (Adjusted EBITDA divided by Net revenues-non-GAAP)36.0 %18.6 % 23.1 %
Nine months ended September 30, 2022
(in thousands)Machine ClothingAlbany Engineered
Composites
Corporate expenses
and other
Total Company
Net income/(loss) (GAAP)$161,752 $20,688 $(104,173)$78,267 
Interest expense/(income), net  11,336 11,336 
Income tax expense— — 22,273 22,273 
Depreciation and amortization expense14,716 34,792 2,400 51,908 
EBITDA (non-GAAP)176,468 55,480 (68,164)163,784 
Restructuring expenses, net255 — 13 268 
Foreign currency revaluation (gains)/losses (a)(3,690)755 (17,644)(20,579)
Dissolution of business relationships in Russia1,573 — 781 2,354 
Pension settlement expense— — 49,128 49,128 
Acquisition/integration costs— 806 — 806 
Pre-tax (income) attributable to noncontrolling interest — (633)— (633)
Adjusted EBITDA (non-GAAP)$174,606 $56,408 $(35,886)$195,128 
Adjusted EBITDA margin (Adjusted EBITDA divided by Net revenues-non-GAAP)38.0 %18.4 % 25.5 %







Per share impact of the adjustments to earnings per share are as follows:
Three months ended September 30, 2023
(in thousands, except per share amounts)
Pre tax
Amounts
Tax
Effect
After tax
Effect
Per share
Effect
Restructuring expenses, net$82 $21 $61 $0.00 
Foreign currency revaluation (gains)/losses (a)(121)(35)(86)0.00 
CEO transition expenses2,052 — 2,052 0.07 
Inventory step-up impacting Cost of goods sold1,370 411 959 0.03 
Acquisition/integration costs1,915 476 1,439 0.05 
Three months ended September 30, 2022
(in thousands, except per share amounts)
Pre tax
Amounts
Tax
Effect
After tax
Effect
Per share
Effect
Restructuring expenses, net$42 $$36 $0.00 
Foreign currency revaluation (gains)/losses (a)(9,442)(2,694)(6,748)(0.22)
Dissolution of business relationships in Russia(214)(18)(196)(0.01)
Pension settlement expense49,128 11,947 37,181 1.20 
Tax impact of stranded OCI benefit from Tax Cuts and Job Act (TCJA) for pension liability (b)— 5,217 (5,217)(0.17)
Acquisition/integration costs255 77 178 0.01 
Nine months ended September 30, 2023
(in thousands, except per share amounts)
Pre tax
Amounts
Tax
Effect
After tax
Effect
Per share
Effect
Restructuring expenses, net$227 $68 $159 $0.01 
Foreign currency revaluation (gains)/losses (a)(1,720)(504)(1,216)(0.04)
CEO transition expenses2,052 — 2,052 0.07 
Withholding tax related to internal restructuring— (3,026)3,026 0.10 
Inventory step-up impacting Cost of goods sold1,370 411 959 0.03 
Acquisition/integration costs2,818 725 2,093 0.07 
Nine months ended September 30, 2022
(in thousands, except per share amounts)
Pre tax
Amounts
Tax
Effect
After tax
Effect
Per share
Effect
Restructuring expenses, net$268 $75 $193 $0.01 
Foreign currency revaluation (gains)/losses (a)(20,579)(5,829)(14,750)(0.47)
Dissolution of business relationships in Russia2,354 314 2,040 0.06 
Pension settlement expense49,128 11,947 37,181 1.20 
Tax impact of stranded OCI benefit from TCJA for pension liability (b)— 5,217 (5,217)(0.17)
Acquisition/integration costs806 241 565 0.03 











The following table provides a reconciliation of Earnings per share to Adjusted Earnings per share:
Three months ended September 30,Nine months ended September 30,
Per share amounts (Basic)2023202220232022
Earnings per share (GAAP)$0.87 $0.34 $2.59 $2.47 
Adjustments, after tax:
Restructuring expenses, net — 0.01 0.01 
Foreign currency revaluation (gains)/losses (a) (0.22)(0.04)(0.47)
Dissolution of business relationships in Russia (0.01) 0.06 
Pension settlement charge 1.20  1.20 
Tax impact of stranded OCI benefit from Tax Cuts and Job Act (TCJA) for pension liability (b) (0.17) (0.17)
CEO transition expenses0.07 — 0.07 — 
Withholding tax related to internal restructuring — 0.10 — 
Inventory step-up impacting Cost of goods sold0.03 — 0.03 — 
Acquisition/integration costs0.05 0.01 0.07 0.03 
Adjusted Earnings per share (non-GAAP)$1.02 $1.15 $2.83 $3.13 



The calculations of net debt are as follows:
(in thousands)September 30, 2023December 31, 2022September 30, 2022
Current maturities of long-term debt$27,246 $— $— 
Long-term debt463,339 439,000 447,000 
Total debt490,585 439,000 447,000 
Cash and cash equivalents171,506 291,776 276,482 
Net debt (non-GAAP)$319,079 $147,224 $170,518 































The calculation of net leverage ratio as of September 30, 2023 is as follows:
Total Company
Twelve months ended Nine months endedTrailing twelve months ended
(in thousands)December 31, 2022September 30, 2022September 30, 2023September 30, 2023 (non-GAAP) (c)
Net income/(loss) (GAAP)$96,508 $78,267 $81,066 $99,307 
Interest expense/(income), net14,000 11,336 10,049 12,713 
Income tax expense35,472 22,273 39,908 53,107 
Depreciation and amortization expense69,049 51,908 54,778 71,919 
EBITDA (non-GAAP)215,029 163,784 185,801 237,046 
Restructuring expenses, net106 268 227 65 
Foreign currency revaluation (gains)/losses (a)(9,829)(20,579)(1,720)9,030 
Dissolution of business relationships in Russia2,275 2,354 — (79)
CEO transition expenses— — 2,052 2,052 
Inventory step-up impacting Cost of goods sold— — 1,370 1,370 
Pension settlement expense49,128 49,128 — — 
IP address sales(3,420)— — (3,420)
Acquisition/integration costs1,057 806 2,818 3,069 
Pre-tax (income) attributable to noncontrolling interest(817)(633)(474)(658)
Adjusted EBITDA (non-GAAP)$253,529 $195,128 $190,074 $248,475 
(in thousands, except for net leverage ratio)September 30, 2023
Net debt (non-GAAP)$319,079 
Trailing twelve months Adjusted EBITDA (non-GAAP)248,475 
Net leverage ratio (non-GAAP)1.28 
(a) Foreign currency revaluation (gains)/losses represent unrealized gains and losses arising from the remeasurement of monetary assets and liabilities denominated in non-functional currencies on the balance sheet date.
(b) Our Adjusted EPS excluded the benefit from the reclassification of stranded income tax effects caused by the TCJA associated with the US pension plan liability that was eliminated in September 2022, a one-time event that would not recur in the future. Such stranded income tax effect represented a one-time benefit that distorted the effective tax rate for the quarter and year-to-date ended September 30, 2022, and would not be indicative of ongoing or expected future income tax rate at the Company. Management believes excluding pension settlement expense and its income tax impact, including the stranded income tax effects, from its Adjusted EBITDA and Adjusted EPS for the quarter and year-to-date ended September 30, 2022 would provide investors a transparent view and enhanced ability to better assess the Company’s ongoing operational and financial performance.
(c) Calculated as amounts incurred during the twelve months ended December 31, 2022, less those incurred during the nine months ended September 30, 2022, plus those incurred during the nine months ended September 30, 2023.








The tables below provide a reconciliation of forecasted full-year 2023 Adjusted EBITDA and Adjusted EPS (non-GAAP measures) to the comparable GAAP measures.
Forecast of Full Year 2023 Adjusted EBITDAMachine ClothingAEC
(in millions)LowHighLowHigh
Net income attributable to the Company (GAAP) (d)$185 $195 $36 $40 
Income attributable to the noncontrolling interest— — — — 
Interest expense/(income), net— — — — 
Income tax expense— — — — 
Depreciation and amortization23 23 48 49 
EBITDA (non-GAAP)208 218 84 89 
Restructuring expenses, net (e)— — — — 
Foreign currency revaluation (gains)/losses (e)— — 
Acquisition/integration costs (e)— — 
Cost of goods sold adjustment due to acquisition— — 
Pre-tax (income)/loss attributable to non-controlling interest— — — — 
Adjusted EBITDA (non-GAAP)$215 $225 $85 $90 
(d) Interest, Other income/expense and Income taxes are not allocated to the business segments
Forecast of Full Year 2023 Adjusted EBITDATotal Company
(in millions)LowHigh
Net income attributable to the Company (GAAP)$95 $105 
Income attributable to the noncontrolling interest— — 
Interest expense/(income), net14 14 
Income tax expense46 52 
Depreciation and amortization75 75 
EBITDA (non-GAAP)230 246 
Restructuring expenses, net (e)— — 
Foreign currency revaluation (gains)/losses (e)(2)(2)
Acquisition/integration costs (e)
CEO transition expenses
Inventory step-up impacting Cost of goods sold
Pre-tax (income)/loss attributable to non-controlling interest— — 
Adjusted EBITDA (non-GAAP)$238 $254 
Total Company
Forecast of Full Year 2023 Earnings per share (basic) (f)LowHigh
Net income attributable to the Company (GAAP)$3.02 $3.37 
Restructuring expenses, net (e)0.01 0.01 
Foreign currency revaluation (gains)/losses (e)(0.04)(0.04)
Withholding tax related to internal restructuring0.10 0.10 
CEO transition expenses0.07 0.07 
Inventory step-up impacting Cost of goods sold0.12 0.12 
Acquisition/integration costs (e)0.07 0.07 
Adjusted Earnings per share (non-GAAP)$3.35 $3.70 
(e)  Due to the uncertainty of these items, we are unable to forecast these items for 2023
(f) Calculations based on weighted average shares outstanding estimate of approximately 31.2 million



About Albany International Corp.

Albany International is a leading developer and manufacturer of engineered components, using advanced materials processing and automation capabilities, with two core businesses. Machine Clothing is the world’s leading producer of fabrics and process belts used in the manufacture of all grades of paper products. Albany Engineered Composites is a growing designer and manufacturer of advanced materials-based engineered components for jet engine and airframe applications, supporting both commercial and military platforms. Albany International is headquartered in Rochester, New Hampshire, operates 32 plants in 14 countries, employs approximately 5,400 people worldwide, and is listed on the New York Stock Exchange (Symbol AIN). Additional information about the Company and its products and services can be found at www.albint.com.

Non-GAAP Measures

This release, including the conference call commentary associated with this release, contains certain non-GAAP measures, that should not be considered in isolation or as a substitute for the related GAAP measures. Such non-GAAP measures include net revenues and percent change in net revenues, excluding the impact of currency translation effects; EBITDA, Adjusted EBITDA, and Adjusted EBITDA margin; Net debt; Net leverage ratio; and Adjusted earnings per share (or Adjusted EPS). Management believes that these non-GAAP measures provide additional useful information to investors regarding the Company’s operational performance.

Presenting Net revenues and change in Net revenues, after currency effects are excluded, provides management and investors insight into underlying revenues trends. Net revenues, or percent changes in net revenues, excluding currency rate effects, are calculated by converting amounts reported in local currencies into U.S. dollars at the exchange rate of a prior period. These amounts are then compared to the U.S. dollar amount as reported in the current period.

EBITDA (calculated as net income excluding interest, income taxes, depreciation and amortization), Adjusted EBITDA, and Adjusted EPS are performance measures that relate to the Company’s continuing operations. The Company defines Adjusted EBITDA as EBITDA excluding costs or benefits that are not reflective of the Company’s ongoing or expected future operational performance. Such excluded costs or benefits do not consist of normal, recurring cash items necessary to generate revenues or operate our business. Adjusted EBITDA margin represents Adjusted EBITDA expressed as a percentage of net revenues.

The Company defines Adjusted EPS as basic earnings per share (GAAP), adjusted by the after tax per share amount of costs or benefits not reflective of the Company’s ongoing or expected future operational performance. The income tax effects are calculated using the applicable statutory income tax rate of the jurisdictions where such costs or benefits were incurred or the effective tax rate applicable to total company results.

The Company’s Adjusted EBITDA, Adjusted EBITDA margin, and Adjusted EPS may not be comparable to similarly titled measures of other companies.

Net debt aids investors in understanding the Company’s debt position if all available cash were applied to pay down indebtedness.

Net leverage ratio informs the investors of the Company's financial leverage at the end of the reporting period, providing an indicator of the Company's ability to repay its debt.

We encourage investors to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

Forward-Looking Statements

This press release may contain statements, estimates, guidance or projections that constitute “forward-looking statements” as defined under U.S. federal securities laws. Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “will,” “should,” “look for,” “guidance,” “guide,” and similar expressions identify forward-looking statements, which generally are not historical in nature. Because forward-looking statements are subject to certain risks and uncertainties (including, without limitation, those set forth in the Company’s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q), actual results may differ materially from those expressed or implied by such forward-looking statements.

Forward-looking statements in this release or in the webcast include, without limitation, statements about macroeconomic conditions, including inflationary cost pressures, as well as global events, which include but are not limited to
geopolitical events; paper-industry trends and conditions during 2023 and in future years; expectations in 2023 and in future periods of revenues, EBITDA, Adjusted EBITDA (both in dollars and as a percentage of net revenues), Adjusted EPS, income, gross profit, gross margin, cash flows and other financial items in each of the Company’s businesses, and for the Company as a whole; the timing and impact of production and development programs in the Company’s AEC business segment and the revenues growth potential of key AEC programs, as well as AEC as a whole; the amount and timing of capital expenditures, future tax rates and cash paid for taxes, depreciation and amortization; future debt and net debt levels and debt covenant ratios; and changes in currency rates and their impact on future revaluation gains and losses. Furthermore, a change in any one or more of the foregoing factors could have a material effect on the Company’s financial results in any period. Such statements are based on current expectations, and the Company undertakes no obligation to publicly update or revise any forward-looking statements.




Statements expressing management’s assessments of the growth potential of its businesses, or referring to earlier assessments of such potential, are not intended as forecasts of actual future growth, and should not be relied on as such. While management believes such assessments to have a reasonable basis, such assessments are, by their nature, inherently uncertain. This release and earlier releases set forth a number of assumptions regarding these assessments, including historical results, independent forecasts regarding the markets in which these businesses operate, and the timing and magnitude of orders for our customers’ products. Historical growth rates are no guarantee of future growth, and such independent forecasts and assumptions could prove materially incorrect in some cases.

Contacts
John Hobbs
603-330-5897
john.hobbs@albint.com