Net sales of $234.9 million increased 2.5% versus the prior quarter from higher sales in the AES business unit. AES net sales increased primarily due to strong demand for EV/HEV applications and higher clean energy, defense and wireless infrastructure market sales, partially offset by a decline in sales for ADAS applications. Demand remained strong in the EMS business, but net sales decreased compared to the prior quarter primarily due to lower production levels from supply constraints and the previously announced disruption to the Company's manufacturing facility in South Korea. The lower production levels contributed to the decline in portable electronics market sales, and tempered growth in industrial market sales. EV/HEV sales declined slightly, compared to strong first quarter sales. Currency exchange rates unfavorably impacted total company net sales in the second quarter of 2021 by $0.8 million compared to prior quarter net sales.

Gross margin was 38.2%, compared to 39.0% in the prior quarter. The decrease in gross margin was primarily due to the impact of supply constraints, raw material price increases and unfavorable product mix, partially offset by higher volumes.

Selling, general and administrative (SG&A) expenses increased by $2.5 million from the prior quarter to $45.0 million. The increase in SG&A expense was due to higher performance based compensation costs and reinvestment initiatives.

GAAP operating margin of 15.2% decreased by 100 basis points from the prior quarter primarily due to lower gross margin and higher SG&A expenses, partially offset by lower restructuring charges. Adjusted operating margin of 17.4% decreased by 160 basis points versus the prior quarter.

GAAP earnings per diluted share were $1.52, compared to earnings per diluted share of $1.66 in the previous quarter. The decrease in GAAP earnings primarily resulted from lower operating income and other income, partially offset by lower tax expense. On an adjusted basis, earnings were $1.72 per diluted share compared to adjusted earnings of $1.92 per diluted share in the prior quarter.

Ending cash and cash equivalents were $203.9 million, an increase of $4.8 million versus the prior quarter. The Company generated free cash flow of approximately $11.9 million in the second quarter of 2021. Net cash provided by operating activities of $29.7 million was offset by $4.0 million of principal payments made on the remaining outstanding borrowings under the Company’s revolving credit facility and capital expenditures of $17.8 million.

About Rogers Corporation
Rogers Corporation (NYSE: ROG) is a global leader in engineered materials to power, protect and connect our world. Rogers delivers innovative solutions to help our customers solve their toughest material challenges. Rogers’ advanced electronic and elastomeric materials are used in applications for EV/HEV, automotive safety and radar systems, mobile devices, renewable energy, wireless infrastructure, energy-efficient motor drives, industrial equipment and more. Headquartered in Chandler, Arizona, Rogers operates manufacturing facilities in the United States, Asia and Europe, with sales offices worldwide.

Safe Harbor Statement
This release contains forward-looking statements, which concern our plans, objectives, outlook, goals, strategies, future events, future net sales or performance, capital expenditures, 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 those indicated by the forward-looking statements. Risks and uncertainties that could cause such results to differ include: the duration and impacts of the novel coronavirus global pandemic and efforts to contain its transmission and distribute vaccines, including the effect of these factors on our business, suppliers, customers, end users and economic conditions generally; failure to capitalize on, volatility within, or other adverse changes with respect to the Company's growth drivers, including advanced mobility and advanced connectivity, such as delays in adoption or implementation of new technologies; uncertain business, economic and political conditions in the United States (U.S.) and abroad, particularly in China, South Korea, Germany, Hungary and Belgium, where we maintain significant manufacturing, sales or administrative operations; the trade policy dynamics between the U.S. and China reflected in trade agreement negotiations and the imposition of tariffs and other trade restrictions, including trade restrictions on Huawei Technologies Co., Ltd. (Huawei); fluctuations in foreign currency exchange rates; our ability to develop innovative products and the extent to which our products are incorporated into end-user products and systems and the extent to which end-user products and systems incorporating our products achieve commercial success; the ability and willingness of our sole or limited source suppliers to deliver certain key raw materials, including commodities, to us in a timely and cost-effective manner; intense global competition affecting both our existing products and products currently under development; business interruptions due to catastrophes or other similar events, such as natural disasters, war, terrorism or public health crises; failure to realize, or delays in the realization of anticipated benefits of acquisitions and divestitures due to, among other things, the existence of unknown liabilities or difficulty integrating acquired businesses; our ability to attract and retain management and skilled technical personnel; our ability to protect our proprietary technology from infringement by third parties and/or allegations that our technology infringes third party rights; changes in effective tax rates or tax laws and regulations in the jurisdictions in which we operate; failure to comply with financial and restrictive covenants in our credit agreement or restrictions on our operational and financial flexibility due to such covenants; the outcome of ongoing and future litigation, including our asbestos-related product liability litigation; changes in environmental laws and regulations applicable to our business; and disruptions in, or breaches of, our information technology systems. 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 reports filed with the Securities and Exchange Commission, including quarterly reports on Form 10-Q. 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 the results for the second quarter of 2021 will take place today, Thursday, July 29, 2021 at 5pm ET.

A live webcast of the event and the accompanying presentation can be accessed on the Rogers Corporation website at https://www.rogerscorp.com/investors .