PolyOne Updates First-quarter 2008 Outlook
March 21 2008 - 9:57AM
PR Newswire (US)
CLEVELAND, March 21 /PRNewswire-FirstCall/ -- PolyOne Corporation
(NYSE: POL) today updated its outlook for the first quarter ending
March 31, 2008. The Company expects first quarter consolidated
sales to increase 9% to 11% compared with the first quarter of
2007. Demand is expected to weaken in the later portion of the
quarter as the North American economic downturn is impacting other
industrial end markets beyond automotive and building and
residential construction, such as wire and cable. Aggregate sales
for PolyOne's Specialty businesses, including sales from the
recently acquired GLS Corporation, are projected to grow nearly 25%
in the quarter compared with the first quarter of 2007. GLS was
acquired in January 2008 and represents approximately 14% of the
Specialty growth. PolyOne's Specialty businesses consist of:
International Color and Engineered Materials, Specialty Engineered
Materials (which includes the results of GLS), North American Color
and Additives, and Specialty Inks and Polymer Systems. Operating
income in the aggregate for these businesses is projected to grow
significantly from the same period a year ago, reflecting stronger
profit margins across this increased sales base. The Company
anticipates that International segment sales and operating income
in the first quarter would continue to demonstrate double-digit
growth compared to a year ago. This anticipated solid performance
by the Specialty businesses underpins PolyOne's strategic portfolio
transformation. For PolyOne Distribution, the Company anticipates
meaningful increases in both sales and operating income during the
first quarter of 2008 compared with the first quarter of 2007.
First-quarter sales for the Company's Vinyl Business segment are
expected to decline 2% to 4% compared with the first quarter of
2007. Vinyl Business segment earnings are anticipated to be
substantially below first quarter of 2007 levels, due to a
combination of lower demand and margin pressure caused by higher
raw material and energy costs not fully offset by increased
pricing. Resin and Intermediates segment earnings are projected to
increase slightly compared with a year ago. Chlor-alkali margins
have remained strong, although weak vinyl industry demand is
adversely affecting sales volumes. In the first-quarter of 2007,
the OxyVinyls joint venture reported a $1.3 million loss. PolyOne
sold its interest in this joint venture on July 6, 2007. Additional
considerations: -- The Company expects first quarter Corporate and
eliminations to be between $12 million and $14 million, including a
$1.6 million one-time purchase accounting charge related to the GLS
acquisition. -- The Company anticipates net financing expenses to
be approximately $9.2 million in the first quarter of 2008, down
$5.5 million from the $14.7 million recorded in the first quarter
of 2007. The lower expense is due to the redemption of $241.4
million of the 2010 notes, partially offset by debt incurred in
connection with the acquisition of GLS. First quarter 2008 Earnings
Release and Conference Call PolyOne intends to release its
first-quarter earnings on Tuesday, May 6, 2008, and host a
conference call at 9:00 a.m. Eastern time on Wednesday, May 7,
2008. The conference dial-in number is 866-543-6403 (domestic) or
617-213- 8896 (international), passcode 77320730, conference topic:
First quarter 2008 PolyOne Earnings Conference Call. The replay
number is 888-286-8010 (domestic) or 617-801-6888 (international).
The passcode for the replay is 99544252. The call will be broadcast
live and then be available via replay until Wednesday, May 14,
2008, on the Company's Web site at http://www.polyone.com/. About
PolyOne PolyOne Corporation, with annual revenues of more than $2.7
billion, is a leading global provider of specialized polymer
materials, services and solutions. Headquartered outside of
Cleveland, Ohio USA, PolyOne has operations around the world. For
additional information on PolyOne, visit our new website at
http://www.polyone.com/. Forward-looking Statements 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. You can
identify these statements by the fact that they do not relate
strictly to historic or current facts. They use words such as
"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
performance and/or sales. In particular, these include statements
relating to future actions; prospective changes in raw material
costs, product pricing or product demand; future performance;
results of current and anticipated market conditions and market
strategies; sales efforts; expenses; the outcome of contingencies
such as legal proceedings; and financial results, including those
of GLS. Factors that could cause actual results to differ
materially include, but are not limited to: -- the effect on
foreign operations of currency fluctuations, tariffs,
nationalization, exchange controls, limitations on foreign
investment in local businesses and other political, economic and
regulatory risks; -- changes in polymer consumption growth rates
within the U.S., Europe or Asia or other countries where PolyOne
conducts business; -- changes in global industry capacity or in the
rate at which anticipated changes in industry capacity come online
in the polyvinyl chloride (PVC), chlor-alkali, vinyl chloride
monomer (VCM) or other industries in which PolyOne participates; --
fluctuations in raw material prices, quality and supply and in
energy prices and supply, in particular fluctuations outside the
normal range of industry cycles; -- production outages or material
costs associated with scheduled or unscheduled maintenance
programs; -- the cost of compliance with environmental laws and
regulations, including any increased cost of complying with new or
revised laws and regulations; -- unanticipated developments that
could occur with respect to contingencies such as litigation and
environmental matters, including any developments that would
require any increase in our costs and/or reserves for such
contingencies; -- an inability to achieve or delays in achieving or
achievement of less than the anticipated financial benefit from
initiatives related to 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 in certain locations in order to avoid
business disruptions; -- any change in any agreements with product
suppliers to PolyOne Distribution that prohibits PolyOne from
continuing to distribute a supplier's products to customers; -- the
ability to successfully integrate GLS; -- the ability to
successfully integrate Ngai Hing PlastChem, 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. We cannot guarantee
that any forward-looking statement will be realized, although we
believe we have been prudent in our plans and assumptions.
Achievement of future results is subject to risks, uncertainties
and inaccurate assumptions. Should known or unknown risks or
uncertainties materialize, or should underlying assumptions prove
inaccurate, actual results could vary materially from those
anticipated, estimated or projected. Investors should bear this in
mind as they consider forward-looking statements. We undertake no
obligation to publicly update forward-looking statements, whether
as a result of new information, future events or otherwise. You are
advised, however, 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. You should
understand that it is not possible to predict or identify all risk
factors. Consequently, you should not consider any list to be a
complete set of all potential risks or uncertainties. (Ref. #32108)
DATASOURCE: PolyOne Corporation CONTACT: Investors, W. David
Wilson, Senior Vice President & Chief Financial Officer,
+1-440-930-3204, or Media, John Daggett, Director of Corporate
Communications, +1-440-930-3162 Web site: http://www.polyone.com/
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