Rogers Corporation Reports Fourth Quarter 2017 and Full Year Results

Full year 2017 highlights, versus full year 2016:

• Net sales of $821.0 million, up 25.1%
• Gross margin of 38.8%, up 79 basis points
• Earnings of $4.34 per diluted share; adjusted earnings of $5.76 per
  diluted share

Fourth quarter 2017 highlights, versus fourth quarter 2016:

• Record net sales of $209.0 million, up 20.8%
• Gross margin of 36.1%, down 252 basis points
• Earnings of $0.37 per diluted share; adjusted earnings of $1.36 per
  diluted share

CHANDLER, Ariz.–(BUSINESS WIRE)–Rogers
Corporation (NYSE:ROG) today announced financial results for the
2017 full year and fourth quarter.

Full year 2017

The company reported 2017 net sales of $821.0 million. Net sales for the
full year 2016 were $656.3 million. Net sales during 2017 were
unfavorably impacted by $1.0 million as a result of currency
fluctuations, including a weaker Renminbi partially offset by a stronger
Euro.

Earnings for full year 2017 were $4.34 per diluted share, compared to
$2.65 per diluted share for full year 2016. On an adjusted basis,
earnings were $5.76 per diluted share, compared to $3.72 for full year
2016.

Full year 2017 net income was $80.5 million, compared to $48.3 million
for full year 2016. Adjusted EBITDA was $189.7 million for full year
2017, versus $130.1 million for full year 2016.

Gross margin was 38.8% in 2017, compared to 38.0% in 2016. Operating
margin was 15.9% for full year 2017, compared to 12.8% in the full year
of 2016. Adjusted operating margin was 18.5% in the full year of 2017,
compared to 15.2% in the full year of 2016.

Fourth quarter 2017

The Company reported 2017 fourth quarter net sales of $209.0 million,
which were within the Company's previously announced guidance of $200 to
$210 million, compared to 2016 fourth quarter net sales of $173.0
million. Currency exchange rates favorably impacted 2017 fourth quarter
net sales by $4.5 million due to strengthening in the Euro and Renminbi.

Earnings for the 2017 fourth quarter were $0.37 per diluted share,
compared to $0.65 per diluted share in the fourth quarter of 2016.
Earnings per diluted share were below the Company's guidance range of
$1.18 to $1.28. On an adjusted basis, earnings were $1.36 per diluted
share, compared to adjusted earnings of $0.94 per diluted share in the
fourth quarter of 2016. Adjusted earnings were within the Company's
guidance of $1.35 to $1.45 per diluted share.

Fourth quarter 2017 net income was $7.0 million, compared to $11.9
million in the fourth quarter of 2016. Adjusted EBITDA was $38.1 million
for the fourth quarter of 2017, compared to $32.7 million reported in
the fourth quarter of 2016.

Gross margin was 36.1% in the fourth quarter of 2017, compared to 38.6%
in the fourth quarter of 2016. Operating margin was 9.1% in the fourth
quarter of 2017, compared to 10.3% in the fourth quarter of 2016.
Adjusted operating margin was 13.2% in the fourth quarter of 2017,
compared to 14.8% in the fourth quarter of 2016.

"In 2017, Rogers set full-year performance records for both revenue and
profitability, successfully achieving strong growth across all of our
business segments,” stated Bruce D. Hoechner, Rogers' President and CEO.
“Our robust revenue growth continued in Q4, although we did have
temporary operating challenges during the quarter that are being
addressed. We are optimistic about the outlook for 2018 given Rogers'
strong leadership position in our core markets and our ability to
execute."

Business segment discussion

Advanced Connectivity Solutions (ACS)
Advanced
Connectivity Solutions reported 2017 fourth quarter net sales of $75.5
million, a 5.3% increase compared to 2016 fourth quarter net sales of
$71.7 million. The increase in 2017 fourth quarter net sales was largely
driven by growth in high frequency circuit materials for automotive
advanced driver assistance systems (ADAS) and portable electronics,
partially offset by lower demand for wireless 4G LTE applications.
Fourth quarter 2017 net sales were favorably impacted by $0.7 million
due to fluctuations in currency exchange rates.

Elastomeric Material Solutions (EMS)
Elastomeric
Material Solutions reported 2017 fourth quarter net sales of $76.0
million, a 34.0% increase compared to 2016 fourth quarter net sales of
$56.7 million. The 2017 fourth quarter included a $13.5 million increase
in net sales from recent acquisitions. On an organic basis, EMS net
sales increased $5.9 million, or 10.4%, on higher demand across all
segments, with particularly strong growth in portable electronics and
automotive applications including electric and hybrid electric vehicles.
Fluctuations in currency exchange rates favorably impacted net sales by
$0.8 million in the 2017 fourth quarter.

Power Electronics Solutions (PES)
Power
Electronics Solutions reported 2017 fourth quarter net sales of $52.0
million, a 33.4% increase compared to 2016 fourth quarter net sales of
$39.0 million. The 2017 fourth quarter increase was due to broad based
demand across markets, including renewable energy, electric and hybrid
electric vehicles, variable frequency motor drives and laser diode
coolers. Fourth quarter 2017 net sales were favorably impacted by $3.2
million due to fluctuations in currency exchange rates.

Other
Other reported 2017
fourth quarter net sales of $5.5 million, down $0.1 million compared to
the fourth quarter of 2016 sales of $5.6 million.

Balance sheet and other highlights

Cash position
Rogers ended the
fourth quarter of 2017 with cash and cash equivalents of $181.2 million,
a decrease of $46.6 million from $227.8 million at December 31, 2016.
The primary drivers of the lower cash balance were debt and long-term
lease payments of approximately $110.7 million in 2017, and an
acquisition completed in the first quarter of 2017 for approximately
$60.2 million, partially offset by net cash provided from operating
activities of $139.0 million.

Cash flow
Net cash provided
from operating activities was $139.0 million in 2017, an increase
compared to $117.0 million in 2016. The increase in net cash provided by
operating activities was driven by higher 2017 net income partially
offset by an increase in working capital due to growth. Capital spending
was $27.2 million in 2017, an increase compared to $18.1 million in 2016.

Effective tax rate
Rogers'
effective tax rate for 2017 was 39.5%, including the impact of tax
reform in the United States (U.S. Tax Reform), compared to 41.3% in
2016. The 2017 rate decrease was primarily due to lower foreign tax
impact on remitted and unremitted foreign earnings and profits, equity
compensation excess tax deductions recognized in 2017 and increased
international tax rate benefits due to earnings mix. This was
substantially offset by our provisional estimate of the impact of U.S.
Tax Reform, a decrease in reversal of reserves associated with uncertain
tax positions and a change in valuation allowance associated with
deferred tax assets that are capital in nature. Excluding the impact of
U.S. Tax Reform, our effective tax rate for 2017 was 29.2%.

Financial outlook
Rogers guides
its 2018 first quarter net sales to a range of $208 to $218 million.
Rogers guides its 2018 first quarter earnings to a range of $1.15 to
$1.30 per diluted share. Adjusted earnings are guided to a range of
$1.30 to $1.45 per diluted share.

Rogers is in the process of reviewing the full impact of U.S. Tax Reform
and the impact it will have on the Company's ongoing tax rate.
Currently, based on the information available and analysis performed to
date, Rogers guides its 2018 first quarter normalized effective tax rate
to be approximately 28-30%.

For the full year 2018, Rogers expects capital expenditures to be in a
range of $50 to $60 million.

About Rogers Corporation
Rogers
Corporation (NYSE:ROG) is a global leader in engineered materials to
power, protect, and connect our world. With more than 180 years of
materials science experience, Rogers delivers high-performance solutions
that enable clean energy, internet connectivity, and safety and
protection applications, as well as other technologies where reliability
is critical. Rogers delivers Power Electronics Solutions for
energy-efficient motor drives, e-Mobility and renewable energy;
Elastomeric Material Solutions for sealing, vibration management and
impact protection in mobile devices, transportation interiors,
industrial equipment and performance apparel; and Advanced Connectivity
Solutions for wireless infrastructure, automotive safety and radar
systems. Headquartered in Arizona (USA), Rogers operates manufacturing
facilities in the United States, China, Germany, Belgium, Hungary, and
South Korea, with joint ventures and sales offices worldwide.

Safe Harbor Statement
This
release contains forward-looking statements, which may concern our
plans, objectives, outlook, goals, strategies, future events, future net
sales or performance, capital expenditures, financing needs, future
restructuring, plans or intentions relating to expansions, business
trends and other information that is not historical information. All
forward-looking statements are based upon information available to us on
the date of this release and are subject to risks, uncertainties and
other factors, many of which are outside of our control, which could
cause actual results to differ materially from the results discussed in
the forward-looking statements. Risks that could cause such results to
differ include: failure to capitalize on, and volatility within, the
Company's growth drivers, including internet connectivity, clean energy,
and safety and protection, as well as specific market and industry
trends within these growth drivers; business, economic and political
conditions in the United States and abroad, particularly in China, South
Korea, Germany, Hungary and Belgium, where we maintain significant
manufacturing, sales or administrative operations; fluctuations in
foreign currency exchange rates; research and development efforts;
competitive developments; business development transactions and related
integration considerations; the outcome of ongoing and future
litigation, including our asbestos-related product liability litigation;
and changes in laws and regulations applicable to our business. For
additional information about the risks, uncertainties and other factors
that may affect our business, please see our most recent annual report
on Form 10-K and any subsequent quarterly reports on Forms 10-Q filed
with the Securities and Exchange Commission. Rogers Corporation assumes
no responsibility to update any forward-looking statements contained
herein except as required by law.

Conference call and additional information

A conference call to discuss 2017 fourth quarter and full year results
will be held today on Tuesday February 27, 2018 at 5 pm ET.

A live webcast and slide presentation will be available under the
investors section of www.rogerscorp.com/ir.

To participate, please dial:

1-800-574-8929 Toll-free in the United States
1-973-935-8524
Internationally
There is no passcode for the live teleconference.

If you are unable to attend, a conference call playback will be
available from February 27, 2018 at approximately 8 pm ET through March
6, 2018 at 11:59 pm ET, by dialing 1-855-859-2056 from the United
States, and 1-404-537-3406 from outside of the US, each with passcode
9698817.

Additionally, the archived webcast will be available on the Rogers
website at approximately 8 pm ET February 27, 2018.

Additional information
Please contact the Company directly
via email or visit the Rogers website.

(Financial statements follow)

Reconciliation of non-GAAP financial measures to the comparable
GAAP measures

Non-GAAP financial measures:

This earnings release includes the following financial measures that are
not presented in accordance with generally accepted accounting
principles in the United States of America (“GAAP”):

(1) Adjusted earnings per diluted share, which the Company defines as
earnings per diluted share excluding acquisition-related amortization of
intangible assets and discrete items, such as restructuring expenses,
certain impairments, environmental accrual adjustments, acquisition and
related integration costs, non-recurring tax charges, asbestos-related
charges, and gains or losses on asset or business dispositions
(collectively, “Discrete Items”);

(2) Adjusted EBITDA, which the Company defines as net income excluding
interest expense, income tax expense, depreciation and amortization, and
Discrete Items; and

(3) Adjusted operating margin, which the Company defines as operating
margin excluding acquisition-related amortization of intangible assets
and Discrete Items.

Management believes each of these measures is useful to investors
because they allow for comparison to the Company’s performance in prior
periods without the effect of items that, by their nature, tend to
obscure the Company’s core operating results due to the potential
variability across periods based on the timing, frequency and magnitude.
As a result, management believes that adjusted earnings per diluted
share, adjusted EBITDA and adjusted operating margin enhance the ability
of investors to analyze trends in the Company’s business and evaluate
the Company’s performance relative to peer companies. However, non-GAAP
financial measures have limitations as analytical tools and should not
be considered in isolation from, or solely as alternatives to, financial
measures prepared in accordance with GAAP. In addition, these non-GAAP
financial measures may differ from similarly named measures used by
other companies. Reconciliations of the differences between these
non-GAAP financial measures and their most directly comparable financial
measures calculated in accordance with GAAP are set forth below.

*Values in table may not add due to rounding.

*Percentages in table may not add due to rounding.

Reconciliation of GAAP earnings per diluted share to adjusted
earnings per diluted share guidance for the 2017 fourth quarter:

Reconciliation of GAAP earnings per diluted share to adjusted
earnings per diluted share guidance for the 2018 first quarter:

Contacts

Rogers Corporation
Jack Monti, 480-917-6026
[email protected]
http://www.rogerscorp.com