Horizon Global (HZN) Q4 2020 Earnings Call Transcript

Horizon Global (HZN)
Q4 2020 Earnings Call
Mar 11, 2021, 8:30 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good morning, everyone, and welcome to Horizon Global's fourth-quarter 2020 conference call. My name is Andrea and I will be your operator for today's call. [Operator instructions] I would now like to introduce Mr. Jeff Tryka with Lambert IR, Horizon Global's investor relations firm.

Mr. Tryka, you may proceed.

Jeff Tryka -- Lambert IR -- Senior Director

Thank you, operator. Good morning and welcome to Horizon Global's fourth-quarter and full-year 2020 conference call and webcast. On the call today are Terry Gohl, Horizon Global's chief executive officer; and Dennis Richardville, Horizon Global's chief financial officer. Earlier this morning, we announced our fourth-quarter 2020 results.

The release is available on many news sites as well as in the investor relations section of our website at horizonglobal.com. Turning to Slide 2. Today's presentation also includes non-GAAP disclosures. These disclosures are reconciled to GAAP in the appendices to our quarterly press release and presentation, both of which are available on the investor relations section of our website at horizonglobal.com.

Turning to Slide 3. I'd like to remind you that statements in today's presentation will include our views about Horizon Global's future performance, which constitute forward-looking statements. These statements are subject to risks and uncertainties that could cause our actual results to differ materially from the forward-looking statements. We've described these risks and uncertainties in our risk factors and other disclosures in the company's most recent annual report on Form 10-K, quarterly reports on Form 10-Q and other filings with the Securities and Exchange Commission.

With all that being said, I would like to turn the call over to Horizon Global's chief executive officer, Terry Gohl. Terry?

Terry Gohl -- Chief Executive Officer

Thank you, Jeff and welcome to all of you who are participating in our call today. First, on behalf of the complete Horizon Global team, I will probably present our fourth-quarter and full-year 2020 results. In last quarter's earnings call, we described the momentum that we were experiencing as a company as we sprang back from the second quarter impact of the global COVID-19 pandemic. As we reflect on our performance in the fourth-quarter and full-year 2020, our theme can be best summed up in these two words, on track.

2020, as you all know, was a challenging one. It's hard to believe that it's been a full-year since the global pandemic enveloped us all, and we were all faced with many new challenges that were brought from it, challenges without the clarity of historical countermeasures or road maps to follow to lead us through it. Across the spectrum from our customers, to our suppliers and to our incredible workforce, we should take pause and reflect on the incredible achievements and advancements we all have made in our industry, while being on the forefront of the development and implementation of COVID-specific operational protocols that protect our employees as well as those in the communities we serve, while allowing us to continue to advance our businesses. Hats off to all of you.

We, at Horizon, adapted. We defined our plan, and we are extremely pleased to say that we remained on track, on track with our rate of change plans tied to addressing our company's weaknesses and on track with our objectives tied to ensuring Horizon Global's position as the No. 1 supplier of choice for our customers, the No. 1 customer of choice for our great suppliers and the No.

1 employee of choice for our outstanding employees around the globe. What we will present today will reinforce that, and we are excited to provide an in-depth look at our 2020 performance as well as providing an early look at several indicators that reflect continued momentum in 2021. Turning to Page 5. During our third-quarter call, we presented significant rate of change improvements for our financial and operational metrics across the board.

In today's presentation, we are presenting similar rate of change improvements resulting from the tremendous effort and focus of our team. Keeping with the theme today, we want to ensure that you understand that these results represent what we had planned for and that they reflect only the initial step in a multiyear turnaround plan we developed for the company at the tail end of 2019. These numbers, while representing outstanding rate of improvement from the year prior, simply reflect the impact of the initial steps we have taken throughout the company: actions, including, but not limited to, organizational structure, talent enhancements and optimization, to best-in-class business process deployments across several targeted areas, to operational excellence and continuous improvement methods and actions deployed across the board. In 2020, we set the foundation for the company that we expected to achieve.

Simply put, we remained on track. Looking forward on this page, you will see the breadth of actions we set for the company to achieve in 2020. The green checks reflect action complete status, showing that we were not deterred with our -- from our objectives in spite of the COVID-19 pandemic and the multitude of unprecedented challenges that came along with it during 2020. I won't go into all these items line by line, they are there for your review.

But please recognize that behind every one of these headline actions are hundreds of subactions that make up the work plan for each macro objective. Please recognize that we focused on eliminating waste throughout our company with the principal focus being on our operational performance, both on manufacturing and distribution. Our initial focus, when it came to these improvements, was addressing the state of the business in North America. We chose to go big and to execute a plan that would position Horizon not only as an acceptable supplier to our combined channels but to transform our business to present us as the top-tier supplier against the most stringent standards, those standards assigned by our OEM customers.

Mission accomplished, as we continuously improved our ratings and now have plants that we would stack up against anyone. Recent customer IATF audit results have been excellent and position us for further business opportunities as we move forward. Simply put, we achieved our planned actions and then some, we remain on track. Turning to Page 6.

How did we perform in the fourth-quarter and the full-year 2020? As we look at the margin performance during the period, you will see, as we did in the third quarter, dramatic year-over-year improvements as we recognize the value of improvement actions taken throughout the course of the year. Net sales for the fourth quarter at $175.9 million represented a 23.6% improvement from the prior year. Net sales for both regions were up for the quarter, with Americas leading the way with an increase of 34.3% and Europe-Africa up 12.6%. Dennis will provide further details of this in his comments to follow.

Our adjusted EBITDA performance of $7.3 million for the fourth quarter was $23.8 million or 1,580 basis points better than the fourth quarter of 2019. Again, this was bolstered by positive sales volumes and the impact of continuous improvement actions across all aspects of our business. Our 2020 full-year adjusted EBITDA of $26.4 million also represents significant improvement from the prior year, with this key financial metric being up $34.7 million or 520 basis points better than 2019. Please note that this was accomplished despite full-year lower sales of $29.3 million, with the most severe sales decline concentrated at the end of the first quarter and continuing through the second quarter of 2020 due to the COVID-impacted production schedules.

Fourth-quarter operating loss of $800,000 was significantly better than 2019. For this measure, 2,320 basis points better. Yes, 2,320 basis points better. The full-year operating loss of $6.9 million, while significantly better than the prior year by $50.3 million, represents the heavy impact of the COVID-reduced volumes experienced earlier in the year.

When it came to cash flow and liquidity, the team continued to perform extremely well. The company generated $39.1 million of cash from operations for the year, an improvement of a staggering $107.6 million from 2019. Our culture and methods changed under this management team during 2020. We are focused on cash generation and operate accordingly.

We have improved our working capital metrics, all while ensuring that we continue to invest in our operations and in new business. Overall, while the rate of change for the quarter and for the year was impressive, it was basically on track to our one year plan, regardless of COVID. Performance in the back half of the year highlights the impact of our continuous improvement actions and increased market demand and our increase in market share. Please turn to Page 7.

On this slide, we'll continue to highlight two fundamentals of our American sales. In this case, we are reflecting the year-over-year unit sales increases seen for our core backbone products in North America, our aftermarket hitches and our brake controller portfolio. As you can see, we have capitalized on the operational improvements implemented throughout 2020 to support accelerating market demand and to secure conquest volume from our competitors. Relative to our aftermarket Hitch portfolio, we increased unit sales performance by 59% in the fourth quarter compared to prior year.

Even more impressive was a 93% increase in December 2020 compared to December 2019. An exceptional result, but there is more to follow, as you will see in our order intake as we exited 2020, with substantial booked orders to be filled in 2021. This product line carries significant opportunities for us, and we are in the process of implementing manufacturing investments to increase capacity even further. A second, but equally important core product, is their brake controller line.

Investments made in operational improvements implemented throughout 2020 are continuing to pay off for us in terms of unit sales. Q4 sales were up 44% from 2019, including a 51% year-over-year improvement in December 2020 versus December 2019. This product line was impacted more heavily during COVID shutdown period due to its high concentration of OEM volume at that time. We have and will continue to expand this product line and add capacity during quarter 1 and quarter 2 of 2021.

While these two product lines are highlighted, please note that we are increasing our production capacity for many other fabricated products made in North America. As you should see, we are going on the offensive relative to capitalizing on our transformation across our entire product line. We expect to maximize our capacities of our plants to meet market demand and to ensure product availability for our branded products. Market fundamentals for these products remained positive for both aftermarket and OEM channels, increasing towing and cargo management accessories into their portfolio.

While the RV business is booming, OE and general consumer demand continues to rise. Lifestyle accessorizing to support travel and leisure continues at a torrid pace as outdoor activities and recreational activities continue to drive demand. Sales of bikes, ATVs, watercrafts, along with camping accessory sales, are all leading to increased demand for our products. This is not showing any signs of slowing down soon.

The OEM production plans continue to be focused on pickups and SUVs, and this remains a strong indicator of towing and accessory demand for the future. Favorability for our products and greater leveling of demand away from historical sensitivities impacted and seasonality of RV sector will certainly result. Infrastructure and construction remains strong and has the potential to accelerate with potential federal investments. This will be supportive of OEM vehicle demand and the individual business owners supporting these infrastructure initiatives, this to drive continuation of accessorizing with our products.

Turning to Page 8. On this page, we continue with the theme of operational efficiency. We introduced this side last quarter as it represented a significant focus for us in terms of sales velocity improvement tied to a multitude of actions taken. Consider the unit sales increase for hitches and brake control is represented on the prior slide, as well as our portfolio management optimization actions described in prior releases.

And you can see that through these actions, we are increasing our efficiency throughout our distribution sites in North America. We've improved our sales value per unit sold by 45% for June through December 2020 versus prior year. This includes an 85% improvement for December 2020 versus December 2019. While we don't control market demand or mix, we do control what products we bring to the market and the volumes of those products that we present to the marketplace.

This strategy continues to yield positive results for the company. Turning to Page 9. Here, we are presenting an alternative view of performance on a year-over-year comparative basis. Putting that into perspective, post-COVID shutdown periods of July through December 2020, we increased our sales by 17.9% over the same period in 2019.

While converting on those sales with a 220% increase in our adjusted EBITDA performance compared to the same period in 2019. The market continues to respond favorably to the company and our actions with demonstrated confidence via increased order intake volume across both the Americas and the Europe and Africa regions, including both the aftermarket and the OEM sales channels in both regions. Note that the Americas, our pursuit of breaking through the double-digit margin performance, was achieved in the fourth quarter despite the seasonality of the business. This is a good start.

Further at this point, please turn to Page 10. On this chart, we depict our gross sales versus open orders that were in place at the end of each month, ending in December 2020 in North America as compared to 2019. As you can see, during the fourth quarter, we had monthly secured orders not yet to be filled, well above prior year levels. Balances increased to each month throughout the quarter from $30 million to $50 million in December.

December was 79% better than the prior year for this measure. Our customers continue to exhibit confidence in our company and our brands with increasing orders and equally important, sustainability of those orders. As noted earlier, we have taken measures to increase our capacity and will continue with new capacity increase measures in support of our customers and the furtherance of our strategic plan. Take a look at the $50 million balance at the end of December and the actual sales in January of 2020, significant indication of the strength of the market and the outlook for demand going into 2021.

Again, good signs across the board. On Page 11, we highlight the recent action taken relative to successfully refinancing our debt. We exited 2020 with positive tailwinds in performance. So with that backdrop, we decided to opportunistically investigate our debt refinancing options.

Following a competitive process, our new financing partner, Atlantic Park, came out on top with attractive terms that addressed our existing term loan and provided committed financing to address our convertible notes. We were able to secure a $225 million facility with favorable conditions and rates. $100 million was applying to address our term loan, with $125 million being retained under a delayed draw facility to address our converts in the future. A nominal 25-basis-point ticking fee applied to the committed delayed draw funds.

We secured a rate of LIBOR plus 750 with a covenant-light structure that provides operational flexibility as we continue to execute our strategic plan. As part of the agreement with Atlantic Park, the company issued 3.9 million warrants at an exercise price of $9. This as well highlights significant confidence in our company. We thank Matt Bonanno and the entire Atlantic team for their investment.

We appreciate your confidence and support. I'll now turn it over to Dennis for the financial section before returning with some closing comments and early indicators for 2021.

Dennis Richardville -- Chief Financial Officer

Thank you, Terry. Good morning, everyone and thank you for joining us. To echo Terry's comments, we are pleased with the fourth-quarter and full-year results. Despite the macro impact of COVID-19, the efforts of the Horizon Global team have contributed to positive financial results.

And we are continuing to work diligently to ensure it continues as we focus on earnings growth, liquidity and working capital management. I would like to thank everyone for their contributions and dedication. Please turn to Slide 11 for an update on our refinancing. As Terry discussed, on February 2, we successfully refinanced our existing term loan by entering into a new credit agreement with Atlantic Park for a 6-year $225 million term loan facility.

The loan included an initial commitment of $100 million, which was fully borrowed at the time of the agreement and used to repay all the outstanding borrowings and accrued interest on the company's existing term loan. The new term loan also provides for a $125 million delayed draw facility that the company can borrow to repay our outstanding convertible notes. The reduced interest rate is LIBOR plus 750 basis points, subject to a 1% LIBOR floor. The delayed draw facility has a 25-basis-point ticking fee on the undrawn portion.

The new term loan also provides flexible financial covenants, including a $27.5 million capital expenditure covenant and a net leverage ratio covenant with the initial net leverage ratio test commencing with the quarter ending March 31, 2023. The new term loan is further evidence of the company's opportunistic approach and provides for financial flexibility and long-term stability to the capital structure to support the company's strategic initiatives. Please turn to Slide 12 for a review of the company's consolidated results for the fourth quarter of 2020. As a reminder, all results will be on a continuing operations basis.

As a result of the company's sale of its APAC segment in the third quarter of 2019, APAC is classified as discontinued operations for all the periods presented in Horizon Global's financial statements, therefore, they are not included in the discussion of ongoing results. For the fourth quarter of 2020, consolidated net sales were $175.9 million, an increase of $33.6 million or 23.6% over the fourth quarter of 2019. The increase was primarily attributable to $24.7 million of higher net sales in the Americas segment, but both operating segments reported net sales increases for the quarter. We reported an operating loss of $0.8 million, an improvement of $32.9 million over the fourth quarter of 2019.

Increased gross profit as a result of increased net sales, coupled with manufacturing and operating efficiencies and $7.4 million of SG&A savings, drove the favorability in the quarter. We reported adjusted EBITDA of $7.3 million, which is an increase of $23.8 million over the fourth quarter of 2019. Higher adjusted EBITDA was primarily due to both the increase in gross profit and favorable SG&A previously mentioned. Consolidated adjusted EBITDA margin increased to 4.2% as compared to a negative margin of 11.6% in the fourth quarter of 2019.

Now, let's turn to Slide 13 for a review of the segment performance for the quarter. Net sales in the Americas were $96.8 million, $24.7 million or 34.3% higher than the fourth quarter of 2019. We reported strong demand and volume across virtually all of the Americas sales channels. The net sales increase was primarily driven by $13.3 million of higher net sales in the aftermarket channel, as well as a $7.5 million combined increase in the retail and e-commerce channels.

Automotive OEM and OES, net sales also increased $2.1 million. We reported operating profit of $8.6 million in the Americas segment compared to an operating loss of $16.2 million for the fourth quarter of 2019. The increase in operating profit was primarily driven by higher gross profit in the quarter from the increased sales volumes and manufacturing efficiencies across the segment as well as reduction in inventory scrap and reserves compared to the fourth quarter of 2019. We also recognized $8.6 million of favorable SG&A, which contributed to the operating profit improvement.

Adjusted EBITDA increased to $10.9 million as compared to an adjusted EBITDA loss of $5.6 million for the fourth quarter of 2019, based on these strong operating results previously mentioned. Adjusted EBITDA margin increased to 11.3% as compared to a negative margin of 7.7% for the fourth quarter of 2019. Transitioning to our Europe-Africa operating segment, net sales increased to $79.1 million, up $8.9 million or 12.6% compared to the fourth quarter of 2019. This increase was primarily due to $5.9 million of combined higher net sales in the automotive OEM and OES sales channels and $3.1 million increase in the aftermarket sales channel.

We reported an operating loss of $2.4 million compared to an operating loss of $12.2 million for the fourth quarter of 2019. The improvement was driven by a $9.2 million increase in gross profit, primarily attributable to the higher net sales as well as the lower material and labor efficiencies. Adjusted EBITDA increased to $2.5 million as compared to an adjusted EBITDA loss of $5.9 million for the fourth quarter of 2019. Adjusted EBITDA margin increased to 3.1% as compared to a negative margin of 8.4% for the fourth quarter of 2019.

Turning to Slide 14. We show the full-year consolidated results. Consolidated net sales were $661.2 million, a decrease of $29.3 million or 4.2% from the prior year. Our net sales were impacted by the COVID-19 pandemic that began late in the first quarter and significantly impacted the company during the second quarter with business disruption and economic uncertainties in all our end markets.

The net sales decrease from the prior year was primarily attributable to $38.8 million of lower net sales in our Europe-Africa segment, which included a decrease of $37.3 million in the second quarter of 2020. The consolidated net sales decrease for the year was partially offset by an increase in net sales in the Americas segment of $9.7 million over the prior year, despite a $34.8 million decrease in net sales during the second quarter of 2020, the period most significantly impacted by the pandemic. We reported an operating loss of $6.9 million, an improvement of $50.3 million over the prior year. This improvement was driven by a higher gross profit of $24.3 million, despite the impact of COVID-19 on net sales in the first half of the year as well as $26.8 million of global SG&A improvement.

Adjusted EBITDA for 2020 was $26.4 million, which is $34.7 million higher than the adjusted EBITDA loss of $8.3 million for 2019. Consolidated adjusted EBITDA margin increased to 4% as compared to a negative margin of 1.2% for the prior year. Now, let's turn to Slide 15 for a review of the full-year segment performance. Net sales in the Americas were $382.4 million, $9.7 million higher than the prior year, despite the previously mentioned COVID-19 impacts.

Combined net sales in the aftermarket and e-commerce channels were $25.9 million higher than the prior year. This increase was partially offset by a combined $15.7 million decrease in the automotive OEM and retail channels. We reported an operating profit of $28 million compared to an operating loss of $10.4 million from the prior year. The higher operating profit was primarily driven by $24.2 million of higher gross profit for the full year, due in a large part to the implementation of operational improvement initiatives across the segment as well as $13.6 million of SG&A savings.

Adjusted EBITDA for 2020 increased to $38.4 million as compared to $8.4 million for 2019. Adjusted EBITDA margin increased to 10.1% as compared to 2.3% for the prior year. Transitioning to our Europe-Africa operating segment, net sales decreased $38.8 million or 12.2% to $278.9 million compared to the prior year. This decrease is primarily due to lower volumes in the automotive OEM, automotive OES and industrial sales channels, representing a decrease of $40.6 million in the aggregate, resulting from lost production days, due to plant closures and economic uncertainties related to the COVID-19 pandemic, which primarily impacted the second quarter.

Partially offsetting the lower net sales in these channels was $3.6 million of higher net sales in the aftermarket sales channel. We reported an operating loss of $8.4 million compared to an operating loss of $12.1 million from the prior year. The improved operating margin was primarily attributable to higher gross profit in the period as well as $5 million of lower SG&A. Adjusted EBITDA for 2020 was $8.7 million, an increase of $5.9 million over the prior year.

Adjusted EBITDA margin increased 3.1% as compared to 0.9% in the prior year. Now, moving on to our working capital and liquidity and free cash flow position on Slide 16. Total trade working capital was $55.6 million, which represented a decrease of $34 million compared to the fourth quarter of 2020 and a decrease of $11 million compared to the end of the third quarter of 2020. Specifically, receivables increased $15.7 million to $87.4 million from the end of the prior year.

Days sales outstanding was 46, which is consistent with the end of the prior year. Inventory decreased $21.3 million to $115.3 million from the end of the prior year. Days on-hand inventory was 74 days, a decrease of 20 days from the end of the prior year. The company focused on its inventory management during 2020, and the reported results demonstrate these efforts.

Accounts payable increased $21.1 million to $99.5 million from the end of the prior year. Days payables on hand was 64 days, an increase of 10 days from the end of the prior year. Cash and availability or liquidity totaled $83.4 million at the end of 2020, which was comprised of $38.4 million of availability under our credit facilities and cash on hand of $45 million. This reflects a $38.5 million improvement over year-end 2019.

Free cash flow totaled $25.8 million for 2020, which is $104 million higher than the prior year. Free cash flow for the fourth quarter of 2020 was $9.7 million, which is a $13.6 million improvement from the fourth quarter of 2019. The improvement in free cash flow for both periods is significant and demonstrates our focus on working capital management and overall strong financial results of the company. Turning to Slide 17 for a view of our debt and capital structure.

Total gross debt increased by $25.2 million from $240.9 million at the end of 2019 to $266.1 million at year-end 2020. This is primarily due to increased borrowings during the first and second quarter of 2020 to strengthen liquidity in response to the COVID-19 pandemic. As a note, at the time of our refinancing of the new term loan on February 2, 2021, gross debt was $280 million, which represents an increase of $14 million on a pro forma basis from the end of the fourth quarter of 2020. Initial borrowings on the new term loan was used to repay the existing term loan, accrued interest and other related expenses.

Moving on to debt maturities on Slide 18. Our February 2021 refinancing allowed the company to address its near-term maturities, in a cost-effective manner, with the nearest maturity being our convertible notes due Q3 of 2022. We believe the extended runway affords the company the ability to execute on its long-term strategic plans. Overall, our financial results for 2020 demonstrate what was, in many ways, a successful but challenging year as we completed the first full year under the new leadership team, while navigating through the COVID-19 pandemic.

Our operational improvement initiatives helped drive the positive financial results during the year and provided the market confidence that led to the successful refinancing of our term loan. We remain focused on earnings growth, liquidity and continued working capital management to ensure that the cash flow from operations support the liquidity needs of the business. We look forward to continuing the momentum in 2021. With that, I will turn it back over to Terry for his closing comments.

Terry Gohl -- Chief Executive Officer

Thanks, Dennis, and thank you and your team for driving meaningful improvements throughout the finance organization and processes throughout 2020. Great job, and again, thank you. Turning to Page 19. To provide some insight into 2021, we look again at our two key products in North America, hitches and brake controllers.

Relative to hitches, we are showing here a total picture inclusive of aftermarket and OEM performance. Through February year-to-date 2021, our sales are up 19% for this product line and increasing to 29%, in February in comparison to the same period in 2020. We are truly capitalizing on the capacity increases we implemented, along with the strength of the market and demand for our products. Add to this, our order intake increases through the period, which has resulted in an increase in orders to be filled of 21% from January to February.

This results in a strong outlook for this product. Relative to brake controllers, there's to show a similar story. Year-to-date through February, sales are up 30%, with February alone being up 35% as compared to the same period in 2020. New OEM platform launch volume increases, coupled with an increased market penetration in the aftermarket channel, are providing a solid foundation for this product going forward.

We have a solid order book associated with our brake controllers, and we expect to further capitalize on that demand with increased capacities being introduced during Q1 and Q2 this year. Another bit of good news. On Page 20, you see our top level initiatives for 2021. These are broad and lean a bit more to our European operations and customers, all while continuing the foundation built and the actions set during 2020 in the Americas.

We have already been active and successful early this year in execution of our plans regarding refinancing, commercial initiatives and organizational strengthening in our European operations. We have won significant new business in Europe aligned with our targets. As we move forward through the year, we will focus on further optimization and performance in our logistics worldwide as well as our production capacity in both Europe, Africa and North America. We expect to leverage our capacity enhancements to further our vertical integration were accretive and to further our capacities and market position beyond our base strategic plan.

We will begin to assess certain accretive bolt-on acquisitions, organic expansions or collaborations to support it. We also expect to advance our capabilities through advanced business ERP and warehouse management systems to be deployed in North America. We have a solid plan, and we'll continue to be on track to achieve it. Finishing on Page 21, we leave you with these metrics.

For the fourth quarter, liquidity, better than prior year by $38.5 million. Adjusted EBITDA, better than prior year by $23.8 million. Operating profit, better than prior year by $32.9 million and sales, better than prior year at $33.6 million. For the full year, cash flow from operation is better than prior year by $107.6 million.

Adjusted EBITDA better than prior year by $34.7 million, and operating profit better than 2019 by $50.3 million, all this with a major pandemic occurring in 2020. As a final note, the strength of our sales order book in North America, we continue to highlight positive market and customer demand for our products and brands. Our sales are up 7% year over year through February 2021, in spite of material constraints tied to global electronics and with port constraints seen in Q4 2020 and into 2021. We have taken actions tied to addressing these constraints, which only act to retime our book sales.

Thanks to great work by our purchasing, logistics, manufacturing teams, we are seeing improvements to both of these issues entering March. The final note is that our order intake velocity through February 2021 resulted in open orders to be filled at 104% greater than what was in place in February of 2020, a significant indicator of the strength of the market and demands. Another great sign, and we sincerely appreciate our great customers around the globe. In conclusion, we are on track to our plan.

And as you heard today, we are just getting started. Thank you, and then I'll turn it back to the operator for questions.

Questions & Answers:

Operator

[Operator instructions] Thank you. At this time, we have no further questions. I would now like to turn the conference over to Mr. Terry Gohl for your closing remarks.

Terry Gohl -- Chief Executive Officer

Well, given no questions, let me say, thanks again for joining the call today and that we look forward to speaking with you very shortly again as we present our first-quarter results for 2021. And with that, have a great day and thank you.

Operator

[Operator signoff]

Duration: 46 minutes

Call participants:

Jeff Tryka -- Lambert IR -- Senior Director

Terry Gohl -- Chief Executive Officer

Dennis Richardville -- Chief Financial Officer

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