##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 Form 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2008
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number 000-50890
 COMMERCIAL VEHICLE GROUP, INC.
  Delaware
(State or other jurisdiction of 
incorporation or organization)7800 Walton Parkway 
New Albany, Ohio
(Address of principal executive offices)
    
    41-1990662
(I.R.S. Employer
Identification No.)43054
(Zip Code)
 (614) 289-5360
 Not Applicable
  þ o
  Large accelerated filer o
    
    Accelerated filer
þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check is a smaller reporting company)
  o þ




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##### 



COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
QUARTERLY REPORT ON FORM 10-Q
 PART I FINANCIAL INFORMATIONITEM 1 FINANCIAL STATEMENTS
    
    
    1CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2008
AND 2007 (UNAUDITED)
    
    
    1CONDENSED CONSOLIDATED BALANCE SHEETS AS OF MARCH 31, 2008 (UNAUDITED) AND DECEMBER 31,
2007 (UNAUDITED)
    
    
    2CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE THREE
MONTHS ENDED MARCH 31, 2008 AND 2007 (UNAUDITED)
    
    
    3NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
    
    
    4ITEM 2 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
    
    
    21ITEM 3 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    26ITEM 4 CONTROLS AND PROCEDURES
    
    
    26PART II OTHER INFORMATION
    
    
    27SIGNATURES
    
    
    29Certification by Mervin Dunn, President and Chief Executive OfficerCertification by Chad M. Utrup, Chief Financial OfficerCertification Pursuant to Section 906Certification Pursuant to Section 906




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##### Table of Contents



ITEM 1  FINANCIAL STATEMENTS
 COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
 Three Months EndedMarch 31,2008
    
    
    2007(Unaudited)
    
    
    (Unaudited)(In thousands, exceptper share amounts)REVENUES
    
    $
    197,004
    
    
    $
    198,801COST OF REVENUES
    
    
    176,239
    
    
    
    172,532Gross Profit
    
    
    20,765
    
    
    
    26,269SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
    
    
    15,018
    
    
    
    15,554GAIN ON SALE OF LONG-LIVED ASSETS
    
    
    (6,075
    )
    
    
    0AMORTIZATION EXPENSE
    
    
    345
    
    
    
    103Operating Income
    
    
    11,477
    
    
    
    10,612OTHER EXPENSE
    
    
    9,698
    
    
    
    2,320INTEREST EXPENSE
    
    
    3,907
    
    
    
    3,637(Loss) Income Before Provision for Income Taxes
    
    
    (2,128
    )
    
    
    4,655(BENEFIT) PROVISION FOR INCOME TAXES
    
    
    (2,600
    )
    
    
    1,696NET INCOME
    
    $
    472
    
    
    $
    2,959EARNINGS PER COMMON SHARE:Basic
    
    $
    0.02
    
    
    $
    0.14Diluted
    
    $
    0.02
    
    
    $
    0.14WEIGHTED AVERAGE SHARES OUTSTANDING:Basic
    
    
    21,537
    
    
    
    21,389Diluted
    
    
    21,641
    
    
    
    21,663
  1




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COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 March 31,
    
    
    December 31,2008
    
    
    2007(Unaudited)
    
    
    (Unaudited)(In thousands except share and pershare amounts)ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    7,530
    
    
    $
    9,867Accounts receivable, net of reserve for doubtful accounts of
$3,936
and $3,758, respectively
    
    
    120,728
    
    
    
    107,687Inventories, net
    
    
    100,454
    
    
    
    96,385Prepaid expenses
    
    
    17,459
    
    
    
    16,508Deferred income taxes
    
    
    17,178
    
    
    
    12,989Total current assets
    
    
    263,349
    
    
    
    243,436PROPERTY, PLANT AND EQUIPMENT, net
    
    
    96,969
    
    
    
    98,258GOODWILL
    
    
    156,341
    
    
    
    151,189INTANGIBLE ASSETS, net of accumulated amortization of $2,022 and
$1,687, respectively
    
    
    97,240
    
    
    
    97,575OTHER ASSETS, net
    
    
    9,832
    
    
    
    8,631TOTAL ASSETS
    
    $
    623,731
    
    
    $
    599,089LIABILITIES AND STOCKHOLDERS INVESTMENTCURRENT LIABILITIES:Current maturities of long-term debt
    
    $
    118
    
    
    $
    116Accounts payable
    
    
    95,938
    
    
    
    93,033Accrued liabilities
    
    
    39,181
    
    
    
    33,115Total current liabilities
    
    
    135,237
    
    
    
    126,264LONG-TERM DEBT, net of current maturities
    
    
    160,579
    
    
    
    159,609DEFERRED TAX LIABILITIES
    
    
    27,092
    
    
    
    27,076PENSION AND OTHER POST-RETIREMENT BENEFITS
    
    
    18,032
    
    
    
    18,335OTHER LONG-TERM LIABILITIES
    
    
    13,243
    
    
    
    2,470Total liabilities
    
    
    354,183
    
    
    
    333,754COMMITMENTS AND CONTINGENCIES (Note 12)STOCKHOLDERS INVESTMENT:Common stock $.01 par value; 30,000,000 shares authorized;
21,536,814
and 21,536,814 shares issued and outstanding, respectively
    
    
    215
    
    
    
    215Treasury stock purchased from employees; 28,153 shares
    
    
    (414
    )
    
    
    (414
    )Additional paid-in capital
    
    
    178,362
    
    
    
    177,421Retained earnings
    
    
    89,290
    
    
    
    88,818Accumulated other comprehensive income (loss)
    
    
    2,095
    
    
    
    (705
    )Total stockholders investment
    
    
    269,548
    
    
    
    265,335TOTAL LIABILITIES AND STOCKHOLDERS INVESTMENT
    
    $
    623,731
    
    
    $
    599,089
  2




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COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 Three Months EndedMarch 31,2008
    
    
    2007(Unaudited)
    
    
    (Unaudited)(In thousands)CASH FLOWS FROM OPERATING ACTIVITIES:Net income
    
    $
    472
    
    
    $
    2,959Adjustments to reconcile net income to net cash provided by
operating activities:Depreciation and amortization
    
    
    4,688
    
    
    
    3,729Noncash amortization of debt financing costs
    
    
    213
    
    
    
    216Share-based compensation expense
    
    
    943
    
    
    
    846(Gain) loss on sale of long-lived assets
    
    
    (6,043
    )
    
    
    61Deferred income tax benefit
    
    
    (4,173
    )
    
    
    (792
    )Noncash loss on forward exchange contracts
    
    
    9,682
    
    
    
    2,247Change in other operating items
    
    
    (9,606
    )
    
    
    (8,423
    )Net cash (used in) provided by operating activities
    
    
    (3,824
    )
    
    
    843CASH FLOWS FROM INVESTING ACTIVITIES:Purchases of property, plant and equipment
    
    
    (3,627
    )
    
    
    (3,098
    )Proceeds from disposal/sale of property, plant and equipment
    
    
    7,452
    
    
    
    24Other assets and liabilities
    
    
    (5,501
    )
    
    
    (29
    )Net cash used in investing activities
    
    
    (1,676
    )
    
    
    (3,103
    )CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from issuance of common stock under equity incentive plans
    
    
    
    
    
    
    114Excess tax benefit from equity incentive plans
    
    
    
    
    
    
    39Repayment of revolving credit facility
    
    
    (46,000
    )
    
    
    (51,409
    )Borrowings under revolving credit facility
    
    
    47,000
    
    
    
    50,918Repayments of long-term borrowings
    
    
    
    
    
    
    (467
    )Payments on capital lease obligations
    
    
    (31
    )
    
    
    (32
    )Debt issuance costs and other, net
    
    
    (250
    )
    
    
    Net cash provided by (used in) financing activities
    
    
    719
    
    
    
    (837
    )EFFECT OF CURRENCY EXCHANGE RATE CHANGES ON CASH AND
CASH EQUIVALENTS
    
    
    2,444
    
    
    
    (21
    )NET DECREASE IN CASH AND CASH EQUIVALENTS
    
    
    (2,337
    )
    
    
    (3,118
    )CASH AND CASH EQUIVALENTS:Beginning of period
    
    
    9,867
    
    
    
    19,821End of period
    
    $
    7,530
    
    
    $
    16,703SUPPLEMENTAL CASH FLOW INFORMATION:Cash paid for interest
    
    $
    6,062
    
    
    $
    6,486Cash paid (received) for income taxes, net
    
    $
    783
    
    
    $
    (5,288
    )
  3




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##### Table of Contents



COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 1. Description of Business and Basis of Presentation
    2. Recently Issued Accounting Pronouncements
 Fair Value Measurements
  The Fair Value Option for Financial Assets and
Financial Liabilities Accounting for Certain Investments
in Debt and Equity Securities
 Employers Accounting for Defined Benefit Pension
and Other Postretirement Plans  an amendment of FASB Statements No. 87, 88, 106, and 132(R)
 4




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Business Combinations Noncontrolling Interests in Consolidated Finance Statements
 Disclosures about Derivative Instruments and Hedging
Activities an Amendment of FASB No. 133. S Accounting for Derivative Instruments and Hedging Activities.
 3. Fair Value Measurement
  
    5




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Total
    
    
    Level 1
    
    
    Level 2
    
    
    Level 3Derivative Financial Instruments
(1)
    
    $
    (11,179
    )
    
    $
    
    
    
    $
    (11,179
    )
    
    $
    Deferred Compensation (2)
    
    
    1,656
    
    
    
    1,656
    
    
    
    
    
    
    
    Total
    
    $
    (9,523
    )
    
    $
    1,656
    
    
    $
    (11,179
    )
    
    $
    
 
 (1)
    
    Based on observable market transactions of spot and forward rates.(2)
    
    Deferred compensation includes mutual funds and cash equivalents
for payment of certain non-qualified benefits for employees. 4. Restructuring Activities
 Accounting for Costs Associated with Exit or Disposal
Activities
 EmployeeCostsBalance  December 31, 2007
    
    $
    646Deductions for payments made
    
    
    (123
    )Balance  March 31, 2008
    
    $
    523
 5. Share-Based Compensation
 Stock Option Grants and Restricted Stock Awards
    6




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Weighted-Weighted-
    
    
    Average
    
    
    AggregateAverage
    
    
    Remaining
    
    
    IntrinsicOptions
    
    
    Exercise
    
    
    Contractual
    
    
    ValueStock Options
    
    (000s)
    
    
    Price
    
    
    Life (Years)
    
    
    (000s)Outstanding at December 31, 2007
    
    
    750
    
    
    $
    12.45
    
    
    
    6.5
    
    
    $
    2,013Granted
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Forfeited
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Outstanding at March 31, 2008
    
    
    750
    
    
    $
    12.45
    
    
    
    6.2
    
    
    $
    981Exercisable at March 31, 2008
    
    
    750
    
    
    $
    12.45
    
    
    
    6.2
    
    
    $
    981
  Weighted-AverageGrant-Date FairShares (000s)
    
    
    ValueNonvested at December 31, 2007
    
    
    520
    
    
    $
    16.94Granted
    
    
    
    
    
    
    Vested
    
    
    
    
    
    
    Forfeited
    
    
    (3
    )
    
    
    14.67Nonvested at March 31, 2008
    
    
    517
    
    
    $
    16.95
  6. Stockholders Investment
 Common Stock 
 Preferred Stock 
 Earnings Per Share  Earnings per Share Share Based Payment
 7




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Three Months EndedMarch 31,2008
    
    
    2007Net income applicable to common shareholders  basic and diluted
    
    $
    472
    
    
    $
    2,959Weighted average number of common shares outstanding
    
    
    21,537
    
    
    
    21,389Dilutive effect of outstanding stock options and restricted stock
grants after application of the treasury stock method
    
    
    104
    
    
    
    274Dilutive shares outstanding
    
    
    21,641
    
    
    
    21,663Basic earnings per share
    
    $
    0.02
    
    
    $
    0.14Diluted earning per share
    
    $
    0.02
    
    
    $
    0.14
  Dividends 
 7. Accounts Receivable
  8. Inventories
  March 31,
    
    
    December 31,2008
    
    
    2007Raw materials
    
    $
    59,867
    
    
    $
    62,129Work in process
    
    
    25,239
    
    
    
    19,811Finished goods
    
    
    21,341
    
    
    
    19,862Less excess and obsolete
    
    
    (5,993
    )
    
    
    (5,417
    )$
    100,454
    
    
    $
    96,385
  9. Goodwill and Intangible Assets
 Goodwill and Intangible Assets Accounting for
Impairment or Disposal of Long-Lived Assets.
  8




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March 31, 2008Weighted-AverageAmortization
    
    
    Gross Carrying
    
    
    Accumulated
    
    
    Net CarryingPeriod
    
    
    Amount
    
    
    Amortization
    
    
    AmountDefinite-lived intangible assets:Tradenames/Trademarks
    
    30 years
    
    $
    9,790
    
    
    $
    (997
    )
    
    $
    8,793Licenses
    
    7 years
    
    
    438
    
    
    
    (329
    )
    
    
    109Customer relationships
    
    15 years
    
    
    14,234
    
    
    
    (696
    )
    
    
    13,538$
    24,462
    
    
    $
    (2,022
    )
    
    $
    22,440Indefinite-lived intangible assets:Goodwill
    
    
    
    
    
    $
    156,341
    
    
    $
    
    
    
    $
    156,341Customer relationships
    
    
    
    
    
    
    74,800
    
    
    
    
    
    
    
    74,800$
    231,141
    
    
    $
    
    
    
    $
    231,141Total consolidated goodwill and
intangible assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    253,581
 9




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December 31, 2007Weighted-AverageAmortization
    
    
    Gross Carrying
    
    
    Accumulated
    
    
    Net CarryingPeriod
    
    
    Amount
    
    
    Amortization
    
    
    AmountDefinite-lived intangible assets:Tradenames/Trademarks
    
    30 years
    
    $
    9,790
    
    
    $
    (915
    )
    
    $
    8,875Licenses
    
    7 years
    
    
    438
    
    
    
    (313
    )
    
    
    125Customer relationships
    
    15 years
    
    
    14,234
    
    
    
    (459
    )
    
    
    13,775$
    24,462
    
    
    $
    (1,687
    )
    
    $
    22,775Indefinite-lived intangible assets:Goodwill
    
    
    
    
    
    $
    151,189
    
    
    $
    
    
    
    $
    151,189Customer relationships
    
    
    
    
    
    
    74,800
    
    
    
    
    
    
    
    74,800$
    225,989
    
    
    $
    
    
    
    $
    225,989Total consolidated goodwill
and intangible assets
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    248,764
   Fiscal Year Ended
    
    EstimatedDecember 31,
    
    Amortization Expense2008
    
    $
    1,3382009
    
    $
    1,3382010
    
    $
    1,2752011
    
    $
    1,2752012
    
    $
    1,2752013
    
    $
    1,275
  Balance  December 31, 2007
    
    $
    151,189Currency translation adjustment
    
    
    124Post-acquisition adjustments
    
    
    5,028Balance  March 31, 2008
    
    $
    156,341
  10




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10. Debt
  March 31,
    
    
    December 31,2008
    
    
    2007Revolving credit facilities bore interest at a weighted average of
8.2% as of March 31, 2008 and 8.5% as of December 31, 2007
    
    $
    10,500
    
    
    $
    9,5008.0% senior notes due 2013
    
    
    150,000
    
    
    
    150,000Other
    
    
    197
    
    
    
    225160,697
    
    
    
    159,725Less current maturities
    
    
    118
    
    
    
    116$
    160,579
    
    
    $
    159,609
 Credit Agreement Debtors Accounting for the Changes in Line-of-Credit or Revolving-Debt
Arrangements Debtors Accounting for a Modification or Exchange of Debt Instruments
      11




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Terms, Covenants and Compliance Status 
 11. Income Taxes
  Accounting for Uncertainty in Income Taxes
   12. Commitments and Contingencies
 Warranty 
 Balance  December 31, 2007
    
    $
    3,958Additional provisions recorded
    
    
    1,302Deduction for payments made
    
    
    (807
    )Currency translation adjustment
    
    
    47Balance  March 31, 2008
    
    $
    4,500
 Foreign Currency Forward Exchange Contracts 
 12




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U.S. $Local Currency
    
    U.S. $
    
    Equivalent FairAmount
    
    Equivalent
    
    ValueContracts to (buy)
sell currencies:U.S. dollar
    
    $
    (489
    )
    
    $
    (489
    )
    
    $
    (489
    )Eurodollar
    
    
    47,335
    
    
    
    67,246
    
    
    
    76,049Swedish kronor
    
    
    10,880
    
    
    
    1,621
    
    
    
    1,891Japanese yen
    
    
    2,940,000
    
    
    
    29,917
    
    
    
    31,798Australian dollar
    
    
    3,800
    
    
    
    3,223
    
    
    
    3,459
  Litigation 
 13. Pension and Other Post-Retirement Benefit Plans
   Non-U.S. Pension
    
    
    Other Post-U.S. Pension Plans
    
    
    Plans
    
    
    Retirement Benefit Plans2008
    
    
    2007
    
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007Service cost
    
    $
    112
    
    
    $
    125
    
    
    $
    
    
    
    $
    
    
    
    $
    5
    
    
    $
    6Interest cost
    
    
    457
    
    
    
    440
    
    
    
    694
    
    
    
    586
    
    
    
    38
    
    
    
    34Expected return on plan assets
    
    
    (491
    )
    
    
    (381
    )
    
    
    (537
    )
    
    
    (557
    )
    
    
    
    
    
    
    Recognized actuarial loss
    
    
    
    
    
    
    
    
    
    
    66
    
    
    
    47
    
    
    
    (6
    )
    
    
    Net periodic benefit cost
    
    
    78
    
    
    
    184
    
    
    
    223
    
    
    
    76
    
    
    
    37
    
    
    
    40Special Termination Benefits
    
    
    
    
    
    
    55
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    96Net benefit cost
    
    $
    78
    
    
    $
    239
    
    
    $
    223
    
    
    $
    76
    
    
    $
    37
    
    
    $
    136
  13




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14. Comprehensive Income
 Reporting Comprehensive Income,
 Foreign currency translation adjustment
    
    $
    7,668Pension liability
    
    
    (5,406
    )Unrealized loss on derivatives
    
    
    (167
    )$
    2,095
  2008
    
    
    2007Net income
    
    $
    472
    
    
    $
    2,959Other comprehensive income:Foreign currency translation adjustment
    
    
    2,800
    
    
    
    71Comprehensive income
    
    $
    3,272
    
    
    $
    3,030
 15. Related Party Transactions
 ,
 16. Consolidating Guarantor and Non-Guarantor Financial Information
   14




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COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2008
 Parent
    
    
    Guarantor
    
    
    Non-GuarantorCompany
    
    
    Companies
    
    
    Companies
    
    
    Elimination
    
    
    Consolidated(Unaudited)(In thousands)REVENUES
    
    $
    
    
    
    $
    138,752
    
    
    $
    65,254
    
    
    $
    (7,002
    )
    
    $
    197,004COST OF REVENUES
    
    
    
    
    
    
    127,310
    
    
    
    55,708
    
    
    
    (6,779
    )
    
    
    176,239Gross Profit
    
    
    
    
    
    
    11,442
    
    
    
    9,546
    
    
    
    (223
    )
    
    
    20,765SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    
    
    
    
    10,143
    
    
    
    5,110
    
    
    
    (235
    )
    
    
    15,018(GAIN) ON SALE OF
LONG-LIVED ASSETS
    
    
    
    
    
    
    (6,075
    )
    
    
    
    
    
    
    
    
    
    
    (6,075
    )AMORTIZATION EXPENSE
    
    
    
    
    
    
    103
    
    
    
    242
    
    
    
    
    
    
    
    345Operating Income
    
    
    
    
    
    
    7,271
    
    
    
    4,194
    
    
    
    12
    
    
    
    11,477OTHER EXPENSE
    
    
    
    
    
    
    36
    
    
    
    9,662
    
    
    
    
    
    
    
    9,698INTEREST EXPENSE
    
    
    
    
    
    
    3,658
    
    
    
    1,025
    
    
    
    (776
    )
    
    
    3,907Income Before
Provision for
Income Taxes
    
    
    
    
    
    
    3,577
    
    
    
    (6,493
    )
    
    
    788
    
    
    
    (2,128
    )PROVISION FOR INCOME TAXES
    
    
    
    
    
    
    163
    
    
    
    (2,763
    )
    
    
    
    
    
    
    (2,600
    )NET INCOME
    
    $
    
    
    
    $
    3,414
    
    
    $
    (3,730
    )
    
    $
    788
    
    
    $
    472
 15




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##### Table of Contents



COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED BALANCE SHEET AS OF MARCH 31, 2008
 Parent
    
    
    Guarantor
    
    
    Non-GuarantorCompany
    
    
    Companies
    
    
    Companies
    
    
    Elimination
    
    
    Consolidated(Unaudited)(In thousands)ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    
    
    
    $
    3,262
    
    
    $
    6,283
    
    
    $
    (2,015
    )
    
    $
    7,530Accounts receivable, net
    
    
    
    
    
    
    256,877
    
    
    
    42,610
    
    
    
    (178,759
    )
    
    
    120,728Inventories, net
    
    
    
    
    
    
    59,991
    
    
    
    41,062
    
    
    
    (599
    )
    
    
    100,454Prepaid expenses and other current assets
    
    
    
    
    
    
    3,348
    
    
    
    8,667
    
    
    
    5,444
    
    
    
    17,459Deferred income taxes
    
    
    
    
    
    
    15,222
    
    
    
    3,973
    
    
    
    (2,017
    )
    
    
    17,178Total current assets
    
    
    
    
    
    
    338,700
    
    
    
    102,595
    
    
    
    (177,946
    )
    
    
    263,349PROPERTY, PLANT AND
EQUIPMENT, net
    
    
    
    
    
    
    84,003
    
    
    
    12,966
    
    
    
    
    
    
    
    96,969INVESTMENT IN SUBSIDIARIES
    
    
    423,993
    
    
    
    (106,663
    )
    
    
    45,502
    
    
    
    (362,832
    )
    
    
    GOODWILL
    
    
    
    
    
    
    113,908
    
    
    
    42,433
    
    
    
    
    
    
    
    156,341INTANGIBLE ASSETS, net
    
    
    
    
    
    
    83,702
    
    
    
    13,538
    
    
    
    
    
    
    
    97,240OTHER ASSETS, net
    
    
    
    
    
    
    13,684
    
    
    
    3,323
    
    
    
    (7,175
    )
    
    
    9,832TOTAL ASSETS
    
    $
    423,993
    
    
    $
    527,334
    
    
    $
    220,357
    
    
    $
    (547,953
    )
    
    $
    623,731LIABILITIES AND STOCKHOLDERS INVESTMENTCURRENT LIABILITIES:Current maturities of long-term debt
    
    $
    
    
    
    $
    118
    
    
    $
    
    
    
    $
    
    
    
    $
    118Accounts payable
    
    
    
    
    
    
    231,459
    
    
    
    45,253
    
    
    
    (180,774
    )
    
    
    95,938Accrued liabilities
    
    
    
    
    
    
    22,399
    
    
    
    14,131
    
    
    
    2,651
    
    
    
    39,181Total current liabilities
    
    
    
    
    
    
    253,976
    
    
    
    59,384
    
    
    
    (178,123
    )
    
    
    135,237LONG-TERM DEBT, net of current maturities
    
    
    
    
    
    
    160,551
    
    
    
    25,744
    
    
    
    (25,716
    )
    
    
    160,579DEFERRED TAX LIABILITIES
    
    
    
    
    
    
    35,084
    
    
    
    (816
    )
    
    
    (7,176
    )
    
    
    27,092PENSION AND OTHER POST-RETIREMENT BENEFITS
    
    
    
    
    
    
    6,811
    
    
    
    11,221
    
    
    
    
    
    
    
    18,032OTHER LONG-TERM LIABILITIES
    
    
    
    
    
    
    437
    
    
    
    12,806
    
    
    
    
    
    
    
    13,243Total liabilities
    
    
    
    
    
    
    456,859
    
    
    
    108,339
    
    
    
    (211,015
    )
    
    
    354,183STOCKHOLDERS INVESTMENT
    
    
    423,993
    
    
    
    70,475
    
    
    
    112,018
    
    
    
    (336,938
    )
    
    
    269,548TOTAL LIABILITIES AND
STOCKHOLDERS
INVESTMENT
    
    $
    423,993
    
    
    $
    527,334
    
    
    $
    220,357
    
    
    $
    (547,953
    )
    
    $
    623,731
 16




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##### Table of Contents



COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2008
 Parent
    
    
    Guarantor
    
    
    Non-GuarantorCompany
    
    
    Companies
    
    
    Companies
    
    
    Elimination
    
    
    Consolidated(Unaudited)(In thousands)CASH FLOWS FROM OPERATING ACTIVITIES:Net income (loss)
    
    $
    
    
    
    $
    3,414
    
    
    $
    (3,730
    )
    
    $
    788
    
    
    $
    472Adjustments to reconcile net income to
net
cash provided by operating activities:Depreciation and amortization
    
    
    
    
    
    
    3,553
    
    
    
    1,135
    
    
    
    
    
    
    
    4,688Noncash amortization of debt
financing costs
    
    
    
    
    
    
    213
    
    
    
    
    
    
    
    
    
    
    
    213Stock-based compensation expense
    
    
    
    
    
    
    943
    
    
    
    
    
    
    
    
    
    
    
    943(Gain) on sale of long-lived assets
    
    
    
    
    
    
    (6,043
    )
    
    
    
    
    
    
    
    
    
    
    (6,043
    )Deferred income tax provision
    
    
    
    
    
    
    18
    
    
    
    (4,190
    )
    
    
    (1
    )
    
    
    (4,173
    )Noncash gain on forward exchange
contracts
    
    
    
    
    
    
    
    
    
    
    9,682
    
    
    
    
    
    
    
    9,682Change in other operating items
    
    
    
    
    
    
    (4,887
    )
    
    
    (1,917
    )
    
    
    (2,802
    )
    
    
    (9,606
    )Net cash (used in) provided
by operating activities
    
    
    
    
    
    
    (2,789
    )
    
    
    980
    
    
    
    (2,015
    )
    
    
    (3,824
    )CASH FLOWS FROM INVESTING
ACTIVITIES:Purchases of property, plant and
equipment
    
    
    
    
    
    
    (3,002
    )
    
    
    (625
    )
    
    
    
    
    
    
    (3,627
    )Proceeds from disposal/sale of property,
plant
and equipment
    
    
    
    
    
    
    7,432
    
    
    
    20
    
    
    
    
    
    
    
    7,452Other asset and liabilities
    
    
    
    
    
    
    (594
    )
    
    
    (4,907
    )
    
    
    
    
    
    
    (5,501
    )Net cash provided by (used
in) investing activities
    
    
    
    
    
    
    3,836
    
    
    
    (5,512
    )
    
    
    
    
    
    
    (1,676
    )CASH FLOWS FROM FINANCING ACTIVITIES:Repayment of revolving credit facility
    
    
    
    
    
    
    (46,000
    )
    
    
    
    
    
    
    
    
    
    
    (46,000
    )Borrowings under revolving credit
facility
    
    
    
    
    
    
    47,000
    
    
    
    
    
    
    
    
    
    
    
    47,000Payments on capital lease obligations
    
    
    
    
    
    
    (28
    )
    
    
    (3
    )
    
    
    
    
    
    
    (31
    )Other, net
    
    
    
    
    
    
    (250
    )
    
    
    
    
    
    
    
    
    
    
    (250
    )Net cash provided by (used
in) financing activities
    
    
    
    
    
    
    722
    
    
    
    (3
    )
    
    
    
    
    
    
    719EFFECT OF
CURRENCY EXCHANGE RATE CHANGES ON CASH AND CASH
EQUIVALENTS
    
    
    
    
    
    
    144
    
    
    
    2,300
    
    
    
    
    
    
    
    2,444NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS
    
    
    
    
    
    
    1,913
    
    
    
    (2,235
    )
    
    
    (2,015
    )
    
    
    (2,337
    )CASH AND CASH EQUIVALENTS:Beginning of period
    
    
    
    
    
    
    1,349
    
    
    
    8,518
    
    
    
    
    
    
    
    9,867End of period
    
    $
    
    
    
    $
    3,262
    
    
    $
    6,283
    
    
    $
    (2,015
    )
    
    $
    7,530
 17




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##### Table of Contents



COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 2007
 Parent
    
    
    Guarantor
    
    
    Non-GuarantorCompany
    
    
    Companies
    
    
    Companies
    
    
    Elimination
    
    
    Consolidated(Unaudited)(In thousands)REVENUES
    
    $
    
    
    
    $
    158,399
    
    
    $
    41,880
    
    
    $
    (1,478
    )
    
    $
    198,801COST OF REVENUES
    
    
    
    
    
    
    138,416
    
    
    
    35,300
    
    
    
    (1,184
    )
    
    
    172,532Gross Profit
    
    
    
    
    
    
    19,983
    
    
    
    6,580
    
    
    
    (294
    )
    
    
    26,269SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    
    
    
    
    11,963
    
    
    
    3,876
    
    
    
    (285
    )
    
    
    15,554AMORTIZATION EXPENSE
    
    
    
    
    
    
    103
    
    
    
    
    
    
    
    
    
    
    
    103Operating Income
    
    
    
    
    
    
    7,917
    
    
    
    2,704
    
    
    
    (9
    )
    
    
    10,612OTHER EXPENSE
    
    
    
    
    
    
    69
    
    
    
    2,251
    
    
    
    
    
    
    
    2,320INTEREST EXPENSE
    
    
    
    
    
    
    3,356
    
    
    
    281
    
    
    
    
    
    
    
    3,637Income Before
Provision for
Income Taxes
    
    
    
    
    
    
    4,492
    
    
    
    172
    
    
    
    (9
    )
    
    
    4,655PROVISION FOR INCOME TAXES
    
    
    
    
    
    
    1,827
    
    
    
    (131
    )
    
    
    
    
    
    
    1,696NET INCOME
    
    $
    
    
    
    $
    2,665
    
    
    $
    303
    
    
    $
    (9
    )
    
    $
    2,959
 18




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##### Table of Contents



COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 2007
 Parent
    
    
    Guarantor
    
    
    Non-GuarantorCompany
    
    
    Companies
    
    
    Companies
    
    
    Elimination
    
    
    Consolidated(In thousands)ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    
    
    
    $
    1,349
    
    
    $
    8,518
    
    
    $
    
    
    
    $
    9,867Accounts receivable, net
    
    
    
    
    
    
    242,842
    
    
    
    34,824
    
    
    
    (169,979
    )
    
    
    107,687Inventories, net
    
    
    
    
    
    
    58,757
    
    
    
    38,238
    
    
    
    (610
    )
    
    
    96,385Prepaid expenses
    
    
    
    
    
    
    3,175
    
    
    
    7,914
    
    
    
    5,419
    
    
    
    16,508Deferred income taxes
    
    
    
    
    
    
    15,223
    
    
    
    624
    
    
    
    (2,858
    )
    
    
    12,989Total current assets
    
    
    
    
    
    
    321,346
    
    
    
    90,118
    
    
    
    (168,028
    )
    
    
    243,436PROPERTY, PLANT AND
EQUIPMENT, net
    
    
    
    
    
    
    85,817
    
    
    
    12,441
    
    
    
    
    
    
    
    98,258INVESTMENT IN SUBSIDIARIES
    
    
    417,428
    
    
    
    (100,082
    )
    
    
    45,502
    
    
    
    (362,848
    )
    
    
    GOODWILL
    
    
    
    
    
    
    113,787
    
    
    
    37,402
    
    
    
    
    
    
    
    151,189INTANGIBLE ASSETS, net
    
    
    
    
    
    
    83,800
    
    
    
    13,775
    
    
    
    
    
    
    
    97,575OTHER ASSETS, net
    
    
    
    
    
    
    8,631
    
    
    
    
    
    
    
    
    
    
    
    8,631DEFERRED INCOME TAXES
    
    
    
    
    
    
    4,172
    
    
    
    3,323
    
    
    
    (7,495
    )
    
    
    TOTAL ASSETS
    
    $
    417,428
    
    
    $
    517,471
    
    
    $
    202,561
    
    
    $
    (538,371
    )
    
    $
    599,089LIABILITIES AND STOCKHOLDERS INVESTMENTCURRENT LIABILITIES:Current maturities of
long-term debt
    
    $
    
    
    
    $
    116
    
    
    $
    
    
    
    $
    
    
    
    $
    116Accounts payable
    
    
    
    
    
    
    220,923
    
    
    
    42,089
    
    
    
    (169,979
    )
    
    
    93,033Accrued liabilities
    
    
    
    
    
    
    21,128
    
    
    
    9,426
    
    
    
    2,561
    
    
    
    33,115Total current liabilities
    
    
    
    
    
    
    242,167
    
    
    
    51,515
    
    
    
    (167,418
    )
    
    
    126,264LONG-TERM DEBT, net
    
    
    
    
    
    
    159,581
    
    
    
    25,744
    
    
    
    (25,716
    )
    
    
    159,609DEFERRED TAX LIABILITIES
    
    
    
    
    
    
    35,387
    
    
    
    (816
    )
    
    
    (7,495
    )
    
    
    27,076OTHER LONG-TERM LIABILITIES
    
    
    
    
    
    
    7,614
    
    
    
    13,191
    
    
    
    
    
    
    
    20,805Total liabilities
    
    
    
    
    
    
    444,749
    
    
    
    89,634
    
    
    
    (200,629
    )
    
    
    333,754STOCKHOLDERS INVESTMENT
    
    
    417,428
    
    
    
    72,722
    
    
    
    112,927
    
    
    
    (337,742
    )
    
    
    265,335TOTAL
LIABILITIES
AND 

STOCK HOLDERS
INVESTMENT
    
    $
    417,428
    
    
    $
    517,471
    
    
    $
    202,561
    
    
    $
    (538,371
    )
    
    $
    599,089
 19




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##### Table of Contents



COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2007
 Parent
    
    
    Guarantor
    
    
    Non-GuarantorCompany
    
    
    Companies
    
    
    Companies
    
    
    Elimination
    
    
    Consolidated(Unaudited)(In thousands)CASH FLOWS FROM OPERATING ACTIVITIES:Net income (loss)
    
    $
    
    
    
    $
    2,665
    
    
    $
    303
    
    
    $
    (9
    )
    
    $
    2,959Adjustments to reconcile net income
to net
cash provided by operating activities:Depreciation and amortization
    
    
    
    
    
    
    3,135
    
    
    
    594
    
    
    
    
    
    
    
    3,729Noncash amortization of debt
financing costs
    
    
    
    
    
    
    208
    
    
    
    8
    
    
    
    
    
    
    
    216Stock-based compensation expense
    
    
    
    
    
    
    846
    
    
    
    
    
    
    
    
    
    
    
    846Loss (gain) on sale of assets
    
    
    
    
    
    
    63
    
    
    
    (2
    )
    
    
    
    
    
    
    61Deferred income tax provision
    
    
    
    
    
    
    (42
    )
    
    
    (750
    )
    
    
    
    
    
    
    (792
    )Noncash gain on forward
exchange contracts
    
    
    
    
    
    
    
    
    
    
    2,247
    
    
    
    
    
    
    
    2,247Change in other operating items
    
    
    
    
    
    
    (7,874
    )
    
    
    (557
    )
    
    
    8
    
    
    
    (8,423
    )Net cash (used in)
provided by operating
activities
    
    
    
    
    
    
    (999
    )
    
    
    1,843
    
    
    
    (1
    )
    
    
    843CASH FLOWS FROM INVESTING
ACTIVITIES:Purchases of property, plant and
equipment
    
    
    
    
    
    
    (2,456
    )
    
    
    (642
    )
    
    
    
    
    
    
    (3,098
    )Proceeds from disposal/sale of
property, plant
and equipment
    
    
    
    
    
    
    
    
    
    
    24
    
    
    
    
    
    
    
    24Other asset and liabilities
    
    
    
    
    
    
    (29
    )
    
    
    (1
    )
    
    
    1
    
    
    
    (29
    )Net cash (used in)
provided by investing
activities
    
    
    
    
    
    
    (2,485
    )
    
    
    (619
    )
    
    
    1
    
    
    
    (3,103
    )CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from issuance of common stock
under equity incentive plans
    
    
    
    
    
    
    114
    
    
    
    
    
    
    
    
    
    
    
    114Excess tax benefits from equity
incentive plans
    
    
    
    
    
    
    39
    
    
    
    
    
    
    
    
    
    
    
    39Repayment of revolving credit facility
    
    
    
    
    
    
    (46,500
    )
    
    
    (4,909
    )
    
    
    
    
    
    
    (51,409
    )Borrowings under revolving credit
facility
    
    
    
    
    
    
    46,500
    
    
    
    4,418
    
    
    
    
    
    
    
    50,918Repayments of long-term debt
    
    
    
    
    
    
    
    
    
    
    (467
    )
    
    
    
    
    
    
    (467
    )Other, net
    
    
    
    
    
    
    (30
    )
    
    
    (2
    )
    
    
    
    
    
    
    (32
    )Net cash provided by
(used in) financing
activities
    
    
    
    
    
    
    123
    
    
    
    (960
    )
    
    
    
    
    
    
    (837
    )EFFECT OF CURRENCY EXCHANGE RATE
CHANGES ON CASH AND CASH
EQUIVALENTS
    
    
    
    
    
    
    
    
    
    
    (21
    )
    
    
    
    
    
    
    (21
    )NET (DECREASE) INCREASE IN CASH AND CASH
EQUIVALENTS
    
    
    
    
    
    
    (3,361
    )
    
    
    243
    
    
    
    
    
    
    
    (3,118
    )CASH AND CASH EQUIVALENTS:Beginning of period
    
    
    
    
    
    
    18,268
    
    
    
    1,553
    
    
    
    
    
    
    
    19,821End of period
    
    $
    
    
    
    $
    14,907
    
    
    $
    1,796
    
    
    $
    
    
    
    $
    16,703
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##### Table of Contents



ITEM 2  MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Company Overview
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
    
    sourcing efforts in Europe and Asia;
    
    consolidating our supply base to improve purchasing leverage;
    
    eliminating excess production capacity through the closure and consolidation of
manufacturing or assembly facilities; and
    
    implementing Lean Manufacturing and Total Quality Production System (TQPS) initiatives
to improve operating efficiency and product quality.
   Results of Operations
  Three Months EndedMarch 31,2008
    
    2007Revenues
    
    
    100.0
    %
    
    
    100.0
    %Cost of Revenues
    
    
    89.5
    
    
    
    86.8Gross Profit
    
    
    10.5
    
    
    
    13.2Selling, General and Administrative
Expenses
    
    
    7.6
    
    
    
    7.8Gain on Sale of Long-Lived Assets
    
    
    (3.1
    )
    

    Amortization Expense
    
    
    0.2
    
    
    
    0.1Operating Income
    
    
    5.8
    
    
    
    5.3Other Expense
    
    
    4.9
    
    
    
    1.2Interest Expense
    
    
    2.0
    
    
    
    1.8(Loss) Income Before Provision for
Income Taxes
    
    
    (1.1
    )
    
    
    2.3(Benefit) Provision for Income Taxes
    
    
    (1.3
    )
    
    
    0.8Net Income
    
    
    0.2
    %
    
    
    1.5
    %
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##### Table of Contents



Three Months Ended March 31, 2008 Compared to Three Months Ended March 31, 2007
 Revenues
 Gross Profit
 Selling, General and Administrative Expenses
 Gain on Sale of Long-Lived Assets
 Amortization Expense.
 Other Expense
 Interest Expense
 Benefit for Income Taxes
 Net Income
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##### Table of Contents



Liquidity and Capital Resources
 Cash Flows
    Debt and Credit Facilities
  
    
    $10.5 million under our revolving credit facility;
    
    $0.2 million of capital lease
obligations; and
    
    $150 million of 8.0% senior notes due 2013.
  Debtors Accounting for a Modification or Exchange of Debt
Instruments,
  EBITDA to Cash InterestQuarter(s) Ending
    
    Expense Ratio03/31/2008
    
    2.00 to 1.0006/30/2008 and 09/30/2008
    
   2.25 to 1.0012/31/2008 and each fiscal quarter thereafter
    
    2.50 to 1.00
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##### Table of Contents



Fixed ChargeQuarter(s) Ending
    
    Coverage Ratio03/31/2008
    
    .80 to 1.0006/30/2008
    
    .85 to 1.0009/30/2008, 12/31/2008 and 03/31/2009
    
    .90 to 1.006/30/2009
    
    1.00 to 1.009/30/2009
    
    1.15 to 1.0012/31/2009 and each fiscal quarter thereafter
    
    1.25 to 1.00
 Maximum Ratio of TotalQuarter(s) Ending
    
    Indebtedness03/31/2008
    
    6.10 to 1.0006/30/2008
    
    5.65 to 1.0009/30/2008
    
    5.15 to 1.0012/31/2008
    
    4.75 to 1.0003/31/2009
    
    4.50 to 1.0006/30/2009
    
    4.00 to 1.0009/30/2009
    
    3.50 to 1.0012/31/2009 and each fiscal quarter thereafter
    
    3.00 to 1.00
   Update on Contractual Obligations
 Accounting for Uncertainty in Income Taxes
 Forward-Looking Statements
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ITEM 3  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  
 ITEM 4  CONTROLS AND PROCEDURES
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PART II. OTHER INFORMATION
 COMMERCIAL VEHICLE GROUP, INC. AND SUBSIDIARIES
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##### Table of Contents



10.1
    
    Commercial Vehicle Group, Inc. 2008 Bonus Plan (incorporated by
reference to the Companys current report on Form 8-K (File No.
000-50890), filed on March 25, 2008).10.2
    
    Eleventh Amendment to Revolving Credit and Term Loan Agreement, dated
as of March 10, 2008, by and among Commercial Vehicle Group, Inc.,
the subsidiary borrowers from time to time parties thereto, the
foreign currency borrowers from time to time parties thereto, the
banks from time to time parties thereto, U.S. Bank National
Association, one of the banks, as administrative agents for the
banks, and Comerica Bank, one of the banks, as syndication agent for
the banks (incorporated by reference to the Companys current report
on Form 8-K (File No. 000-50890), filed on March 14, 2008).31.1
    
    Certification by Mervin Dunn, President and Chief Executive Officer.31.2
    
    Certification by Chad M. Utrup, Chief Financial Officer.32.1
    
    Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.
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SIGNATURE
  COMMERCIAL VEHICLE GROUP, INC.Date: May 9, 2008
    By:
    /s/ Chad M. UtrupChad M. UtrupChief Financial Officer 29