BATON ROUGE, La., Oct. 26 /PRNewswire-FirstCall/ -- Third quarter
highlights: -- Net sales of $515.3 million and earnings of $52.1
million, or 57 cents per share for the quarter. -- Sequential
improvement in net sales in all business segments. -- Strong
sequential segment income gains in Polymer Additives and Fine
Chemicals segments. -- Strong cash generation leading to net debt
reduction of approximately $115 million in the quarter. Third
Quarter Ended Nine Months Ended September 30, September 30,
------------- ------------- In thousands of dollars, except per
share amounts 2009 2008 2009 2008 ------------------------- ----
---- ---- ---- Net Sales $515,276 $660,463 $1,447,166 $1,949,390
Operating Profit $62,925 $76,892 $122,843 $238,496 Net Income
attributable to Albemarle Corporation $52,131 $56,175 $116,023
$181,091 Diluted earnings per share $0.57 $0.61 $1.26 $1.95 Special
item per share $- $- $(0.09) $(0.02) Per share amount for one time
tax items $- $- $0.13 $- Diluted earnings per share excluding
special and one time tax items $0.57 $0.61 $1.23 $1.97 Albemarle
Corporation (NYSE:ALB) reported third quarter 2009 earnings of
$52.1 million, or 57 cents per share, compared to third quarter
2008 earnings of $56.2 million, or 61 cents per share. The Company
reported net sales in the third quarter of 2009 totaling $515.3
million compared to third quarter 2008 net sales of $660.5 million.
(Logo: http://www.newscom.com/cgi-bin/prnh/20050801/ALBEMARLELOGO )
Earnings for the first nine months of 2009 were $116.0 million, or
$1.26 per share, compared to $181.1 million, or $1.95 per share,
for the first nine months of 2008. Excluding the second quarter
2009 special item related to Port de Bouc ($8.2 million after tax)
and tax benefits related to prior periods ($11.5 million), earnings
for the first nine months of 2009 were $112.7 million, or $1.23 per
share. Excluding first quarter 2008 restructuring charges ($2.1
million after tax), earnings for the first nine months of 2008 were
$183.2 million, or $1.97 per share. Net sales for the first nine
months of 2009 were $1.45 billion compared to $1.95 billion for the
first nine months of 2008. "Volumes continue to improve for many of
our products, and we are encouraged by the sequential increase in
sales and profitability over the prior two quarters. Our order
patterns thus far in the fourth quarter alleviate some of the
concern we previously expressed about the sustainability of the
recovery going forward; however, we remain cautious in this
difficult environment," said Mark C. Rohr, Chairman and Chief
Executive Officer. "We're very proud of our strong cash generation
and working capital management. We have repaid $113 million of debt
in the first nine months and have $260 million of cash and
equivalents at September 30, 2009. We continue to focus on
cost-saving initiatives and aggressive innovation efforts to drive
growth. We've demonstrated an ability to deliver high quality
results in both good as well as tough times and we continue to
drive value for our shareholders." Quarterly Segment Results
Polymer Additives recorded net sales for the third quarter of 2009
of $196.7 million, a 25 percent decrease versus record net sales in
the third quarter of 2008. Softness in consumer end-markets
contributed to the year-over-year decline; however, demand
continues to improve sequentially. Polymer Additives segment income
for the third quarter of 2009 was $26.0 million compared to $27.4
million in the third quarter of 2008. Unfavorable year-over-year
volume and pricing impacts were partially offset by improvements in
raw materials and other operating costs. Higher sales levels and
increased utilization rates contributed to the segment's strong
sequential segment income improvement of 78 percent over the second
quarter of 2009. Catalysts net sales for the third quarter of 2009
were $188.9 million, a decrease of 18 percent versus the third
quarter of 2008. This decrease was due primarily to metals impacts
on HPC refinery catalysts revenues, currency exchange rates and
less favorable product mix in polyolefin catalysts. Catalysts
segment income for the third quarter of 2009 was $33.4 million
compared to $36.5 million for the third quarter of 2008. This
decline was due primarily to lower equity income, unfavorable
currency exchange rates and metals impacts on HPC refinery
catalysts. Segment income declined $4.3 million sequentially due
primarily to polyolefin catalysts product mix and lower equity
income. Fine Chemicals net sales for the third quarter of 2009 were
$129.6 million, down 22 percent from the third quarter of 2008, but
up 25 percent from the second quarter 2009. Segment income for the
third quarter of 2009 was $14.2 million compared to $24.7 million
in the third quarter of 2008. These declines were primarily
attributable to our industrial bromides business. Segment income
margins improved, however, over 600 basis points from second
quarter 2009 due mainly to stronger sales volumes and utilization
rates in the bromine franchise. Cash Flow In the first nine months
of 2009, cash flow from operations funded net repayments of debt of
over $113 million, capital expenditures for plant, machinery and
equipment of $84 million and dividends to shareholders of $33
million. During the quarter, interest and financing expenses were
$6.2 million versus $9.8 million in the third quarter of 2008. This
decrease was due primarily to lower average interest rates year
over year. At September 30, 2009, the Company had approximately
$260 million in cash and equivalents. In addition, the Company has
sufficient capacity to borrow under existing lines of credit and
has no significant debt maturities before 2013. Taxes Our third
quarter 2009 effective income tax rate was 9.7 percent, down from
15.3 percent in the third quarter of 2008. The full year effective
tax rate is expected to be 12 percent, excluding special and one
time tax items, which is approximately 2.0 percent lower than our
previous annual effective tax rate forecast. The tax rate continues
to be influenced by the level and mix of income and has benefited
from a more favorable mix of income in lower tax jurisdictions.
Outlook While challenging conditions still persist in some sectors,
underlying market fundamentals seem to be improving. Short term, we
remain cautious and continue to focus on cash generation until we
get more comfortable with the sustainability of improved market
conditions. We remain confident that Albemarle is well positioned
to manage through the uncertainties of the present market cycle and
to capture the expected medium to long-term upside. Earnings Call
The Company's performance for the third quarter ended September 30,
2009 will be discussed on a conference call at 11:00 AM Eastern
Daylight time on October 27, 2009, which can be accessed through
Albemarle's website under Investor Information at
http://www.albemarle.com/. Albemarle Corporation, headquartered in
Baton Rouge, Louisiana, is a leading global developer, manufacturer
and marketer of highly-engineered specialty chemicals for consumer
electronics; petroleum and petrochemical processing; transportation
and industrial products; pharmaceuticals; agricultural products;
construction and packaging materials. The Company operates in three
business segments, Polymer Additives, Catalysts and Fine Chemicals
and serves customers in approximately 100 countries.
Forward-Looking Statements Some of the information presented in
this press release may constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Although we believe our expectations as reflected are based
on reasonable assumptions within the bounds of our knowledge of our
business and operations, there can be no assurance that actual
results will not differ materially. Factors that could cause actual
results to differ from expectations include, without limitation:
deterioration in economic and business conditions; future financial
and operating performance of our major customers and industries
served by us; the inability to pass through increases in costs and
expenses for raw materials and energy; competition from other
manufacturers; changes in demand for our products; the gain or loss
of significant customers; fluctuations in foreign currencies; and
increased government regulation of our operations or our products.
Additional factors that could cause our results to differ
materially from those described in the forward-looking statements
can be found under "Risk Factors" in Item 1A of our Annual Report
on Form 10-K for the period ended December 31, 2008 and in our
other public filings with the Securities and Exchange Commission.
Readers are urged to review and consider carefully the disclosures
we make in our filings with the Securities and Exchange Commission.
Albemarle Corporation and Subsidiaries Consolidated Statements of
Income (In Thousands of Dollars, Except Share and Per Share
Amounts) (Unaudited) Third Quarter Ended Nine Months Ended
September 30, September 30, 2009 2008 2009 2008 ---- ---- ---- ----
Net sales $515,276 $660,463 $1,447,166 $1,949,390 Cost of goods
sold 381,197 506,280 1,112,763 1,464,815 ------------------ -------
------- --------- --------- Gross profit 134,079 154,183 334,403
484,575 Selling, general and administrative expenses 56,171 59,899
153,086 191,016 Research and development expenses 14,983 17,392
46,081 51,785 Port de Bouc charges - - 12,393(a) - Restructuring
charges - - - 3,278(b) --------------------- --- --- --- -----
Operating profit 62,925 76,892 122,843 238,496 Interest and
financing expenses (6,199) (9,815) (18,561) (28,472) Other income
(expenses), net 343 (2,718) 488 2,066 ---------------- --- ------
--- ----- Income before income taxes and equity in net income of
unconsolidated investments 57,069 64,359 104,770 212,090 Income tax
(expense) benefit (5,549) (9,878) 1,675(c) (39,406)
-------------------- ----- ------ ----- ------- Income before
equity in net income of unconsolidated investments 51,520 54,481
106,445 172,684 Equity in net income of unconsolidated investments
(net of tax) 5,809 6,281 17,962 21,975 -------------------- -----
----- ------ ------ Net income 57,329 60,762(d) 124,407 194,659(d)
Net income attributable to noncontrolling interests (5,198)
(4,587)(d) (8,384) (13,568)(d) --------------- ------ ------ ------
------- Net income attributable to Albemarle Corporation $52,131
$56,175(d) $116,023 $181,091(d) ---------------- ------- -------
-------- -------- Basic earnings per share $0.57 $0.61(e) $1.27
$1.97(e) Diluted earnings per share $0.57 $0.61(e) $1.26 $1.95(e)
Weighted-average common shares outstanding - Basic 91,588 91,395(e)
91,481 91,846(e) Weighted-average common shares outstanding -
Diluted 92,174 92,463(e) 91,955 92,977(e) ----------------------
------ ------ ------ ------ See accompanying notes to the condensed
consolidated financial information. Albemarle Corporation and
Subsidiaries Condensed Consolidated Balance Sheets (In Thousands of
Dollars) (Unaudited) September 30, December 31, 2009 2008 ---- ----
ASSETS Cash and cash equivalents $260,434 $253,303 Other current
assets 742,319 925,620 ------- ------- Total current assets
1,002,753 1,178,923 --------- --------- Property, plant and
equipment 2,416,735 2,322,996 Less accumulated depreciation and
amortization 1,374,405 1,310,648 --------- --------- Net property,
plant and equipment 1,042,330 1,012,348 Other assets and
intangibles 735,065 681,446 ------- ------- Total assets $2,780,148
$2,872,717 ========== ========== LIABILITIES & EQUITY Current
portion of long-term debt $27,721 $26,202 Other current liabilities
314,151 412,165 ------- ------- Total current liabilities 341,872
438,367 ------- ------- Long-term debt 793,098 906,062 Other
noncurrent liabilities 320,328 336,967 Deferred income taxes 80,578
74,838 Albemarle Corporation shareholders' equity (d) 1,197,063
1,065,771 Noncontrolling interests (d) 47,209 50,712 ------ ------
Total liabilities & equity $2,780,148 $2,872,717 ==========
========== See accompanying notes to the condensed consolidated
financial information. Albemarle Corporation and Subsidiaries
Selected Consolidated Cash Flows Data (In Thousands of Dollars)
(Unaudited) Nine Months Ended September 30, ------------- 2009 2008
---- ---- Cash and cash equivalents at beginning of year $253,303
$130,551 Cash and cash equivalents at end of period $260,434
$207,211 Sources of cash and cash equivalents: Net income (d)
124,407 194,659 Proceeds from borrowings 20,269 285,303 Proceeds
from exercise of stock options 4,083 3,931 Uses of cash and cash
equivalents: Capital expenditures (83,610) (63,467) Purchases of
common stock - (163,502) Repayments of long-term debt (133,332)
(42,605) Dividends paid to shareholders (33,306) (31,394) Dividends
paid to noncontrolling interests (8,911) (11,836) Non-cash items:
Depreciation and amortization 74,539 81,555 See accompanying notes
to the condensed consolidated financial information. Albemarle
Corporation and Subsidiaries Consolidated Summary of Segment
Results (In Thousands of Dollars) (Unaudited) Third Quarter Ended
Nine Months Ended September 30, September 30, ------------
------------ 2009 2008 2009 2008 ---- ---- ---- ---- Net sales:
Polymer Additives $196,716 $261,746 $492,636 $766,844 Catalysts
188,911 231,562 600,101 716,045 Fine Chemicals 129,649 167,155
354,429 466,501 ------- ------- ------- ------- Total net sales
$515,276 $660,463 $1,447,166 $1,949,390 ======== ========
========== ========== Segment operating profit: Polymer Additives
$27,243 $28,705 $31,562 $86,337 Catalysts 28,845 30,941 90,314
112,617 Fine Chemicals 16,482 26,830 32,525 77,983 ------ ------
------ ------ Subtotal $72,570 $86,476 $154,401 $276,937 =======
======= ======== ======== Equity in net income (loss) of
unconsolidated investments: Polymer Additives $1,293 $777 $1,563
$3,454 Catalysts 4,543 5,544 16,480 18,598 Fine Chemicals - - - -
Corporate & other (27) (40) (81) (77) --- --- --- --- Total
equity in net income of unconsolidated investments $5,809 $6,281
$17,962 $21,975 ====== ====== ======= ======= Net (income) loss
attributable to noncontrolling interests: Polymer Additives
$(2,490) $(2,078) $(4,145) $(6,183) Catalysts - - - - Fine
Chemicals (2,244) (2,146) (4,402) (7,304) Corporate & other
(464) (363) 163 (81) ---- ---- --- --- Total net income
attributable to noncontrolling interests $(5,198) $(4,587) $(8,384)
$(13,568) ======= ======= ======= ======== Segment income: Polymer
Additives $26,046 $27,404 $28,980 $83,608 Catalysts 33,388 36,485
106,794 131,215 Fine Chemicals 14,238 24,684 28,123 70,679 ------
------ ------ ------ Total segment income 73,672 88,573 163,897
285,502 Corporate & other (10,136) (9,987) (19,083) (35,321)
Port de Bouc charges (a) - - (12,393) - Restructuring charges (b) -
- - (3,278) Interest and financing expenses (6,199) (9,815)
(18,561) (28,472) Other income (expenses), net 343 (2,718) 488
2,066 Income tax (expense) Benefit (c) (5,549) (9,878) 1,675
(39,406) ------- ------- ----- -------- Net income attributable to
Albemarle Corporation (d) $52,131 $56,175 $116,023 $181,091 =======
======= ======== ======== See accompanying notes to the condensed
consolidated financial information. Notes to the Condensed
Consolidated Financial Information (a) The nine-month period ended
September 30, 2009 included charges amounting to $12.4 million
($8.2 million after income taxes, or 9 cents per share) that
related to the costs of a final contract settlement arising from
our 2008 disposition of the Port de Bouc, France facility. (b) The
nine-month period ended September 30, 2008 included charges
amounting to $3.3 million ($2.1 million after income taxes, or 2
cents per share) that related to severance costs in conjunction
with personnel reductions at the Company's former Richmond,
Virginia headquarters and its Singapore sales office. (c) The
nine-month period ended September 30, 2009 included a $9.2 million
(10 cents per share) one time benefit due mainly to a tax issue
settlement for the years 2005 through 2007 with the U.S. Internal
Revenue Service, a $4.2 million benefit associated with the Port de
Bouc charge described in footnote (a), and a non-recurring net
benefit of $2.5 million (3 cents per share) resulting from
adjustments related to prior periods. (d) As adjusted due to the
adoption of new accounting guidance which requires retroactive
application for the presentation of noncontrolling interests on the
balance sheet and statements of income. (e) As adjusted due to the
adoption of new accounting guidance associated with share-based
payment transactions considered to be participating securities.
Basic earnings per share decreased one cent for the three-month
period ended September 30, 2008 as a result of an increase in our
basic weighted-average common shares outstanding of approximately
321,000 shares. Diluted weighted-average common shares outstanding
increased by approximately 198,000 shares for the three-month
period ended September 30, 2008. Basic earnings per share decreased
one cent for the nine-month period ended September 30, 2008 as a
result of an increase in our basic weighted-average common shares
outstanding of approximately 311,000 shares. Diluted
weighted-average common shares outstanding increased by
approximately 203,000 shares for the nine-month period ended
September 30, 2008. Additional Information It should be noted that
earnings or per share amounts excluding special items and one time
tax items is a financial measure that is not required by, or
presented in accordance with, accounting principles generally
accepted in the United States, or GAAP. It is presented here to
exclude the impact of certain non-recurring items on our results.
We believe this measure is more reflective of our operations,
provides transparency to investors and enables period-to-period
comparability of financial performance. Net debt is a supplemental
financial measure that is not required by, or presented in
accordance with GAAP. We believe net debt is helpful in analyzing
leverage and as a performance measure. We define net debt as total
debt plus the portion of outstanding joint venture indebtedness
guaranteed by us (or less the portion of outstanding joint venture
indebtedness consolidated but not guaranteed by us), less cash and
cash equivalents. Set forth below is a reconciliation of net debt,
a non-GAAP financial measure, to total debt, the most directly
comparable financial measure calculated and reported in accordance
with GAAP, as of September 30, 2009, June 30, 2009 and December 31,
2008. A description of other non-GAAP financial measures that we
use to evaluate our operations and financial performance, and
reconciliation of these non-GAAP financial measures to the most
directly comparable financial measures calculated and reported in
accordance with GAAP, can be found in the Investor Information
section of our website at http://www.albemarle.com/, under
"Non-GAAP Reconciliations" under "Investor Relations." ALBEMARLE
CORPORATION AND SUBSIDIARIES Net Debt Reconciliation (In Thousands
of Dollars) (Unaudited) Third Quarter Second Quarter Year Ended
Ended Ended September 30, June 30, December 31, 2009 2009 2008
Total debt $820,819 $847,327 $932,264 JV debt consolidated by the
Company but guaranteed by others (27,272) (27,182) (29,064) Less:
Cash and cash equivalents (260,434) (172,476) (253,303) Net Debt
$533,113 $647,669 $649,897 See accompanying notes to the condensed
consolidated financial information.
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http://photoarchive.ap.org/ DATASOURCE: Albemarle Corporation
CONTACT: Sandra Rodriquez of Albemarle Corporation, +1-225-388-7654
Web Site: http://www.albemarle.com/
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