CLEVELAND – PolyOne Corporation (NYSE: POL), a premier global provider of specialized polymer materials, services and solutions, today announced additional realignment actions to better serve customers and to increase utilization of its manufacturing assets in North America.
These actions will include aligning assets that were acquired as part of the 2013 acquisition of Spartech with PolyOne’s Performance Products and Solutions (PP&S) segment. These assets are primarily located in Ramos, Mexico and will now operate within Producer Services, a business unit of PP&S, which has headquarters in Seabrook, Texas.
“Our multinational customers are increasingly concentrating production in North America and often choose Mexico as a strategic location,” said Robert M. Patterson, executive vice president and chief operating officer, PolyOne Corporation. “Under the leadership of our Producer Services team located in Texas, we look forward to expanding our capabilities in Mexico with improved customer service, quality and delivery.”
“After nine months, we remain extremely pleased with the Spartech acquisition,” said Stephen D. Newlin, chairman, president and chief executive officer, PolyOne Corporation. “We continue to see upside opportunities to expand our portfolio of offerings and better serve our customers, and we remain committed to delivering $0.50 of EPS accretion from the deal in 2015.”
In connection with these changes, a separate facility located in Lockport, New York will also operate as part of Producer Services, and an administrative office in Washington, Pennsylvania will close as this work is transitioned to Seabrook, Texas. Further, the company has realigned certain resources associated with Spartech’s legacy Color and Specialty Compounds segment, based on how these resources will now report within PolyOne’s businesses.
As a result of the realignment, PolyOne has adjusted its segment information for each of the first three quarters of 2013, as shown on Exhibit A, as well as on the Current Report on Form 8-K furnished to the SEC concurrent with the issuance of this release.
PolyOne Corporation, with 2012 revenues of $2.9 billion, is a premier provider of specialized polymer materials, services and solutions. The company is dedicated to serving customers in diverse industries around the globe, by creating value through collaboration, innovation and an unwavering commitment to excellence. Guided by its Core Values, Sustainability Promise and No Surprises PledgeSM, PolyOne is committed to its customers, employees, communities and shareholders through ethical, sustainable and fiscally responsible principles. For more information, visit www.polyone.com.
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Investor Relations Contact:
Isaac D. DeLuca
Vice President, Investor Relations
Kyle G. Rose Director, Corporate Communications
In this press release, statements that are not reported financial results or other historical information are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give current expectations or forecasts of future events and are not guarantees of future performance. They are based on management’s expectations that involve a number of business risks and uncertainties, any of which could cause actual results to differ materially from those expressed in or implied by the forward-looking statements. They use words such as “will,” “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning in connection with any discussion of future operating or financial condition, performance and/or sales. Factors that could cause actual results to differ materially from those implied by these forward-looking statements include, but are not limited to: the final amount of charges resulting from the North American asset realignment and our ability to realize anticipated savings and operational benefits from the asset realignment; our ability to achieve the strategic and other objectives relating to the acquisition of Spartech Corporation, including any expected synergies; our ability to successfully integrate Spartech and achieve the expected results of the acquisition, including, without limitation, the acquisition being accretive at expected levels and within the expected timeframe; disruptions, uncertainty or volatility in the credit markets that could adversely impact the availability of credit already arranged and the availability and cost of credit in the future; the financial condition of our customers, including the ability of customers (especially those that may be highly leveraged and those with inadequate liquidity) to maintain their credit availability; the speed and extent of an economic recovery, including the recovery of the housing market; our ability to achieve new business gains; the effect on foreign operations of currency fluctuations, tariffs, and other political, economic and regulatory risks; changes in polymer consumption growth rates where we conduct business; changes in global industry capacity or in the rate at which anticipated changes in industry capacity come online; fluctuations in raw material prices, quality and supply and in energy prices and supply; production outages or material costs associated with scheduled or unscheduled maintenance programs; unanticipated developments that could occur with respect to contingencies such as litigation and environmental matters; an inability to achieve or delays in achieving or achievement of less than the anticipated financial benefit from initiatives related to working capital reductions, cost reductions, and employee productivity goals; an inability to raise or sustain prices for products or services; an inability to maintain appropriate relations with unions and employees; the inability to achieve expected results from our acquisition activities; our ability to continue to pay cash dividends; the amount and timing of repurchases of our common shares, if any; and other factors affecting our business beyond our control, including, without limitation, changes in the general economy, changes in interest rates and changes in the rate of inflation. The above list of factors is not exhaustive.
We undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. You are advised to consult any further disclosures we make on related subjects in our reports on Form 10-Q, 8-K and 10-K that we provide to the Securities and Exchange Commission.
Segment Information, as Adjusted (Unaudited)
|Global Specialty Engineered Materials||$ 152.9||$ 158.8||$ 157.6|
|Global Color, Additives and Inks||205.3||229.4||219.0|
|Designed Structures and Solutions||41.5||198.9||187.8|
|Performance Products and Solutions||166.6||210.3||207.4|
|Corporate and eliminations||(33.2)||(34.9)||(37.9)|
|Sales||$ 801.1||$ 1,037.6||$ 1,008.9|
|Global Specialty Engineered Materials||$ 39.2||$ 39.0||$ 39.2|
|Global Color, Additives and Inks||67.7||75.2||71.8|
|Designed Structures and Solutions||5.2||25.5||26.9|
|Performance Products and Solutions||24.0||26.9||27.6|
|Corporate and eliminations||(2.0)||9.0||(11.8)|
|Gross margin||$ 162.3||$ 203.7||$ 181.3|
|Selling and administrative expense:|
|Global Specialty Engineered Materials||$ (23.4)||$ (24.0)||$ (24.6)|
|Global Color, Additives and Inks||(43.5)||(44.3)||(42.9)|
|Designed Structures and Solutions||(3.7)||(16.5)||(16.0)|
|Performance Products and Solutions||(10.4)||(11.6)||(12.5)|
|Corporate and eliminations||(28.9)||(15.4)||(12.7)|
|Selling and administrative expense||$ (121.9)||$ (123.0)||$ (119.7)|
|Global Specialty Engineered Materials||$ 15.8||$ 15.0||$ 14.6|
|Global Color, Additives and Inks||24.2||30.9||28.9|
|Designed Structures and Solutions||1.5||9.0||10.9|
|Performance Products and Solutions||13.6||15.3||15.1|
|Corporate and eliminations||(30.8)||(6.4)||(24.5)|
|Operating income||$ 40.5||$ 80.7||$ 61.6|
|Operating income as a percentage of sales:|
|Global Specialty Engineered Materials||10.3%||9.4%||9.3%|
|Global Color, Additives and Inks||11.8%||13.5%||13.2%|
|Designed Structures and Solutions||3.6%||4.5%||5.8%|
|Performance Products and Solutions||8.2%||7.3%||7.3%|
The Specialty Platform consists of our three specialty segments: Global Specialty Engineered Materials; Global Color, Additives and Inks; and Designed Structures and Solutions. We present Specialty Platform sales, gross margin, selling and administration, and operating income because management believes that this is useful information to investors by highlighting our collective progress in advancing our specialization strategy.