-- Net sales rose, led by increases in the Performance Specialties and Crop Protection segments
-- Crop Protection revenues increased 10%, primarily from growth in European markets
-- SGA&R was $15 million or 13% lower than the first quarter of 2007
-- Loss per share from continuing operations of $0.09 vs. $0.08 for first quarter 2007 (GAAP basis) and earnings per share of $0.10 vs. $0.06 per share for first quarter 2007 (managed basis)
MIDDLEBURY, Conn., May 01, 2008 (BUSINESS WIRE) -- Chemtura Corporation (NYSE: CEM; the "Company") reports a net loss
of $21 million, or $0.09 per share, for the first quarter of 2008 and
net earnings on a managed basis of $23 million, or $0.10 per share.
The discussion below includes information on both a GAAP and
managed basis. The Company refers to its non-GAAP financial
information as the 'managed basis' presentation, as this more
accurately reflects the purpose of the disclosure. The Company has
presented the managed basis financial information because management
uses managed basis information internally to evaluate and manage the
performance of the Company's operations and believes that the managed
basis financial information provides useful information to investors.
A reconciliation of the GAAP and managed basis financial information
has been provided in the supplemental schedules included in this
release.
The following is a summary of the first quarter results on a GAAP
basis:
(In millions, except per share data) First quarter
----------------------------------------------------------------------
2008 2007 % change
----------------------------------------------------------------------
Net sales $ 909 $ 889 2%
----------------------------------------------------------------------
Operating (loss) profit $ (6) $ 11 (155)%
----------------------------------------------------------------------
Loss from continuing operations $ (21) $ (20) (5)%
----------------------------------------------------------------------
Loss per share from continuing operations $(0.09) $(0.08) (13)%
----------------------------------------------------------------------
Earnings per share from discontinued
operations $ - $ 0.02 NM
----------------------------------------------------------------------
Per share gain on sale of discontinued
operations $ - $ 0.01 NM
----------------------------------------------------------------------
Net loss per share $(0.09) $(0.05) (80)%
----------------------------------------------------------------------
NM = Not Meaningful
The following is a summary of first quarter results on a managed
basis:
(In millions, except per share data) First quarter
----------------------------------------------------------------------
2008 2007 % change
----------------------------------------------------------------------
Net sales $ 909 $ 889 2%
----------------------------------------------------------------------
Operating profit $ 41 $ 43 (5)%
----------------------------------------------------------------------
Earnings from continuing operations $ 23 $ 15 53%
----------------------------------------------------------------------
Earnings per share from continuing operations $0.10 $0.06 67%
----------------------------------------------------------------------
Earnings per share from discontinued operations $ - $0.02 NM
----------------------------------------------------------------------
Net earnings per share $0.10 $0.08 25%
----------------------------------------------------------------------
NM = Not Meaningful
"Our focus in the first quarter has been on execution. Performance
was in line with our expectations and we delivered on cost reduction.
We did a better job in managing the continuing inflation in raw
material costs and we completed a number of our portfolio realignment
projects," said Robert L. Wood, chairman and CEO.
"We saw the benefit of the diversity in our portfolio this
quarter. Our Crop Protection business delivered a very strong quarter
with operating income up 50% on 10% growth in sales revenues. This
offset a flat year-on-year performance from our Performance
Specialties business due to the timing of the recovery of raw material
cost increases and higher manufacturing costs. Consumer Products was
able to increase profitability despite sales 8% lower than last year.
Operating profit for Polymer Additives was slightly down from last
year but up 20% from the fourth quarter of 2007.
"With our cost reduction actions taking hold, SGA&R was $15
million or 13% lower than in the first quarter of 2007 at 11% of sales
compared to 13% a year ago. Gross profit margins at 20%, down from 23%
a year ago, reflect dramatic impact of raw material increases over the
last year. While we have not yet recovered the ground lost last year,
our businesses did a great job in recovering the raw material cost
increases in the last quarter.
"The first quarter saw a flurry of activity related to our
portfolio realignment. We completed the divestiture of our
oleochemicals business, reducing our exposure to the volatility in the
cost of natural oils and fats, and closed the sale of our fluorine
business. We acquired our partners' interests in our Baxenden
urethanes chemicals joint venture and our antimony joint venture.
Yesterday, we announced an agreement with Baerlocher for the
manufacture of certain heat stabilizer products used in PVC
applications. The oleochemicals, antimony and heat stabilizer actions
all form part of our continuing efforts to improve the positioning and
performance of our Polymer Additives business segment. The Baxenden
purchase will permit us to integrate our global urethane chemicals
activities and leverage our opportunities for growth.
"The second quarter is historically our strongest quarter of the
year and a quarter in which we expect to demonstrate earnings growth
despite the uncertainties of the global economy. Our businesses remain
focused on tightly managing the impacts of raw material cost increases
and improving manufacturing operations."
First Quarter 2008 Business Segment Highlights
-- Polymer Additives revenues decreased $2 million compared with
the first quarter of 2007. The divestiture of the
oleochemicals and organic peroxides businesses reduced
revenues by $9 million and $5 million, respectively.
Additionally, sales volume decreased by $12 million, primarily
related to reduced sales of plastic antioxidants. These
reductions were partially offset by favorable foreign currency
translation of $12 million and higher selling prices of $12
million. Operating profit on a managed basis declined 4% or $1
million compared with the first quarter of 2007, primarily due
to the net impact of raw material and energy cost increases,
which were partially offset by the benefit of higher selling
prices and improved product mix. On a GAAP basis, operating
profit declined 68% or $17 million and included the impact of
$14 million of accelerated depreciation of property, plant and
equipment and $2 million of accelerated recognition of asset
retirement obligations.
-- Performance Specialties revenues increased 21% or $44 million
compared with the first quarter of 2007 but operating profit
on a managed basis was unchanged from the first quarter of
2007. The revenue increase was primarily due to the
acquisition of Kaufman of $20 million, increased sales volumes
of $16 million, higher selling prices of $4 million and
favorable foreign currency translation of $4 million.
Operating profit benefited from the Kaufman acquisition,
higher selling prices and improved product mix. However, these
benefits were offset by increased raw material and energy
costs, manufacturing and freight cost variances and the impact
of the stronger Canadian dollar. On a GAAP basis, operating
profit decreased 4% or $1 million and included a $1 million
impact from the accelerated depreciation of property, plant
and equipment.
-- Consumer Products revenues declined 8% or $9 million compared
with the first quarter of 2007. The decline in sales is due to
lower seasonal demand from the U.S. mass market channel for
recreational and household products, and lower international
demand than the first quarter of 2007. These impacts were
partially offset by higher selling prices and the benefit of
favorable foreign exchange translation. Operating profit rose
150% or $3 million primarily due to the net benefit of
favorable manufacturing efficiencies.
-- Crop Protection revenues increased 10% or $8 million compared
with the first quarter of 2007. The increase in sales was
primarily from European markets. Operating income rose 50% or
$7 million in the first quarter as compared with the same
quarter of 2007 largely from improvements in product mix,
volume, reductions in selling, general and administrative, and
research and development expenses ("SGA&R") and favorable
foreign currency translation.
-- Corporate expense for the quarter was $32 million, which
included $10 million of amortization expense related to
intangibles and $7 million relating to the correction of
accounting treatment for an assumed lease that was not
identified at the time of the merger. Corporate expense in the
first quarter of 2007 was $23 million, which included $9
million of amortization expense related to intangibles.
First Quarter 2008 Significant Transactions and Events
-- On January 31, 2008, the Company completed the sale of its
fluorine chemical business located at the Company's El Dorado,
Arkansas facility. The fluorine chemical business had revenue
of approximately $49 million in 2007. The fluorine chemical
business is reported as a discontinued operation in the
accompanying consolidated financial statements.
-- On February 29, 2008, the Company completed the sale of its
oleochemicals business. The oleochemicals business had revenue
of approximately $175 million in 2007. Proceeds from the
transaction were used to reduce debt.
-- On February 29, 2008, Chemtura acquired the remaining stock of
Baxenden Chemicals Limited Plc. Increasing our ownership to
100%. Chemtura previously held 53.5% of Baxenden's stock.
-- On March 12, 2008, the Company purchased the remaining 50%
interest in GLCC Laurel, LLC.
-- On April 30, 2008, the Company announced it had entered into
an agreement with Baerlocher for the manufacture of certain
heat stabilizers used in PVC.
-- As of March 31, 2008 the Company employed 5,049 people
compared to 5,144 as of December 31, 2007. The reduction
reflects the net effect of the divestitures of the
oleochemicals and fluorine businesses and the benefit of
restructuring actions offset by the addition of 284 employees
as a result of the acquisitions of Baxenden and GLCC Laurel.
First Quarter Results - GAAP
-- Revenue for the quarter was $909 million, or 2% above first
quarter 2007 revenue of $889 million. The increase in revenue
was attributable to $24 million from favorable foreign
exchange translation, $19 million from higher selling prices
and $20 million from the Kaufman acquisition. The increase was
partially offset by $36 million from the impact of the
divestitures of the oleochemicals business, organic peroxides
business and Celogen (R) foaming agents product line and $7
million impact from product mix.
-- Gross profit decreased $18 million compared with the same
period of 2007. The decrease in gross profit resulted from $31
million in higher raw material and energy costs, $7 million
relating to the correction of accounting treatment for an
assumed lease that was not addressed at the time of the merger
and other cost increases of $4 million, offset by $19 million
from higher selling prices, $4 million contribution from the
Kaufman acquisition and $1 million benefit from favorable
manufacturing efficiencies.
-- Operating profit decreased $17 million in the first quarter of
2008 as compared with the same quarter last year. The decrease
in operating profit resulted from a $18 million decrease in
gross profit discussed above, $23 million from the loss on
sale of the oleochemicals business and $6 million increase in
depreciation and amortization primarily due to accelerated
depreciation of property, plant and equipment, offset by a $15
million decrease in SGA&R, $12 million decrease in antitrust
costs and a $3 million decrease in facility closures,
severance and related costs.
-- Other income, net, of $14 million for the quarter primarily
reflects non-recurring foreign exchange gains resulting from
the over-hedging of two inter-company loans.
-- The loss from continuing operations for the first quarter of
2008 was $21 million, or $0.09 per share, compared with a loss
of $20 million, or $0.08 per share, for the first quarter of
2007. The increase in the loss primarily reflects the $17
million decrease in operating profit discussed above,
partially offset by a $12 million increase in other income,
net, $3 million decrease in interest expense and $1 million
decrease in income tax expense.
-- Earnings from discontinued operations were not material for
the first quarter of 2008 and reflect that the fluorine
business was sold on January 31, 2008 and only provided one
month of contribution in the quarter. Earnings from
discontinued operations for the first quarter of 2007 were $5
million (net of $2 million of tax) and reflecting the
contribution from the EPDM, fluorine and optical monomers
businesses that have been subsequently sold.
-- In the first quarter of 2007, the gain on sale of discontinued
operations of $2 million (net of $1 million of tax) represents
the final contingent earn-out proceeds related to the sale of
the OrganoSilicones business in 2003.
First Quarter Managed Basis Results
-- On a managed basis, first quarter 2008 gross profit was $186
million, or 20% of net sales, as compared with first quarter
2007 managed basis gross profit of $205 million, or 23% of net
sales.
-- On a managed basis, first quarter 2008 operating profit was
$41 million, or 5% of net sales, as compared with first
quarter 2007 managed basis operating profit of $43 million, or
5% of net sales.
-- Earnings from continuing operations before income taxes on a
managed basis in 2008 and 2007 exclude pre-tax charges of $47
million and $32 million, respectively, primarily related to
accelerated depreciation of property, plant and equipment,
loss on sale of businesses, antitrust costs, facility
closures, severance and related costs and accelerated
recognition of asset retirement obligations. The amounts
associated with these charges are detailed on page 14 of this
release.
-- Chemtura's managed basis tax rate of 35% represents the
expected effective tax rate for the Company's core operations.
The Company has chosen to apply this rate to pre-tax income on
a managed basis to better reflect underlying operating
performance.
-- Earnings from discontinued operations on a managed basis
principally reflect the contribution of the EPDM, optical
monomers and fluorine businesses of $5 million for the quarter
ended March 31, 2007.
Cash Flows - GAAP
-- Net cash provided by operations in the first quarter of 2008
was $16 million as compared with net cash used in operations
of $31 million in 2007. The change is primarily due to an
increase in securitized receivables during the three months
ended March 31, 2008 as compared to the three months ended
March 31, 2007.
-- The Company's accounts receivable securitization programs
totaled $337 million as of March 31, 2008, $239 million as of
December 31, 2007 and $328 million as of March 31, 2007.
-- At March 31, 2008, the Company's inventory balance of $707
million was increased by the foreign currency translation
impact of the weakening in the U.S. dollar. At the same
exchange rates that applied as of December 31, 2007, the value
of inventories as of March 31, 2008 would have been $695
million.
-- Capital expenditures for the first quarter of 2008 were $23
million compared with $20 million in 2007. The Company
currently anticipates capital expenditures to be $165 million
in 2008, which includes $25 million related to the
consolidation of its legacy ERP systems onto a single instance
of SAP.
-- The Company's total debt as of March 31, 2008 was $1,092
million as compared with $1,063 million as of December 31,
2007. Cash and cash equivalents were $115 million as of March
31, 2008 compared to $77 million as of December 31, 2007.
Managed Basis Financial Measures
The information presented in this press release and in the
attached financial tables includes financial measures that are not
calculated or presented in accordance with Generally Accepted
Accounting Principles in the United States (GAAP). These managed basis
financial measures consist of adjusted results of operations of the
Company that exclude certain expenses, gains and losses that may not
be indicative of the core operations of the Company. Excluded items
include facility closures, severance and related costs, antitrust
costs, merger costs, increased depreciation due to the change in
useful life of assets, unusual and non-recurring settlements, and the
accelerated recognition of asset retirement obligations. In addition
to the managed basis financial measures discussed above, the Company
has applied a managed basis effective income tax rate to our managed
basis income before taxes. Chemtura's managed basis tax rate of 35%
beginning with the third quarter of 2007 represents the expected
effective tax rate for the Company's core operations. Reconciliations
of these managed basis financial measures to their most directly
comparable GAAP financial measures are provided in the attached
financial tables. The Company believes that such managed basis
financial measures provide useful information to investors and may
assist them in evaluating the Company's underlying performance and
identifying operating trends. In addition, management uses these
managed basis financial measures internally to allocate resources and
evaluate the performance of the Company's operations. While the
Company believes that such measures are useful in evaluating the
Company's performance, investors should not consider them to be a
substitute for financial measures prepared in accordance with GAAP. In
addition, these managed basis financial measures may differ from
similarly titled managed basis financial measures used by other
companies and do not provide a comparable view of the Company's
performance relative to other companies in similar industries.
Forward-Looking Statement
This document includes forward-looking statements. These
forward-looking statements are identified by terms and phrases such as
"anticipate," "believe," "intend," "estimate," "expect," "continue,"
"should," "could," "may," "plan," "project," "predict," "will" and
similar expressions and include references to assumptions and relate
to our future prospects, developments and business strategies.
Factors that could cause our actual results to differ materially
from those expressed or implied in such forward-looking statements
include, but are not limited to:
-- General economic conditions;
-- Significant international operations and interests;
-- The ability to obtain increases in selling prices to offset
increases in raw material and energy costs;
-- The ability to retain sales volumes in the event of increasing
selling prices;
-- The ability to absorb fixed cost overhead in the event of
lower volumes;
-- Pension and other post-retirement benefit plan assumptions;
-- The ability to successfully complete the restructuring and
turnaround of our Polymer Additives segment;
-- The ability to obtain growth from demand for flame retardant,
petroleum additive and lubricant, agricultural and pool and
spa product applications;
-- The ability to obtain the synergies anticipated from the
integration of the Kaufman business and gain sales from new
refrigeration lubricant applications;
-- The ability to sustain profitability in our Crop Protection
business due to new generic competition and the failure to
secure new products and technology. Additionally, the Crop
Protection business is dependent on disease and pest
conditions, as well as, local and regional economic
conditions;
-- The ability to sell methyl bromide due to regulatory
restrictions;
-- Changes in weather conditions which could adversely affect the
seasonal selling cycles in both our Consumer Products and Crop
Protection segments;
-- Changes in the availability and/or quality of our energy and
raw materials;
-- The ability to collect our outstanding receivables;
-- Changes in interest rates and foreign currency exchange rates;
-- Changes in technology, market demand and customer
requirements;
-- The enactment of more stringent domestic and international
environmental laws and regulations;
-- The ability to realize expected cost savings under our
restructuring plans, Six Sigma and Lean manufacturing
initiatives;
-- The ability to successfully complete the execution of our
portfolio transformation plan;
-- The ability to reduce our indebtedness levels;
-- The ability to recover our deferred tax assets;
-- The ability to successfully complete the Company's new SAP
platform initiative;
-- The ability to support the goodwill in our business segments;
-- The ability to remain compliant with our debt covenants or
obtain necessary waivers; and
-- Other risks and uncertainties detailed in Item 1A. Risk
Factors or in our filings with the Securities and Exchange
Commission.
These statements are based on the Company's estimates and
assumptions and on currently available information. The
forward-looking statements include information concerning the
Company's possible or assumed future results of operations, and the
Company's actual results may differ significantly from the results
discussed. Forward-looking information is intended to reflect opinions
as of the date this press release was issued and such information will
not necessarily be updated by the Company.
CHEMTURA CORPORATION
Index of Financial Statements and Schedules
Page
----
Financial Statements
Consolidated Statements of Operations (Unaudited) - 9
Three Months ended March 31, 2008 and 2007
Consolidated Balance Sheets - March 31, 2008 (Unaudited) and
December 31, 2007 10
Condensed Consolidated Statements of Cash Flows (Unaudited) -
Three Months ended March 31, 2008 and 2007 11
Segment Net Sales and Operating (Loss) Profit (Unaudited) -
Three Months ended March 31, 2008 and 2007 12
Supplemental Schedules
Major Factors Affecting Net Sales and Operating Results
(Unaudited) -
Three Months ended March 31, 2008 versus 2007 13
Managed Basis Consolidated Statements of Operations (Unaudited) -
Three Months ended March 31, 2008 and 2007 14
Managed Basis Segment Net Sales and Operating Profit (Unaudited)
-
Three Months ended March 31, 2008 and 2007 15
CHEMTURA CORPORATION
Consolidated Statements of Operations (Unaudited)
(In millions, except per share data)
Three Months Ended
March 31,
2008 2007
--------- --------
Net sales $ 909 $ 889
Cost of goods sold 725 687
Selling, general and administrative 85 98
Depreciation and amortization 69 63
Research and development 14 16
Facility closures, severance and related costs - 3
Antitrust costs - 12
Loss on sale of business 23 -
Equity income (1) (1)
-------- -------
Operating (loss) profit (6) 11
Interest expense 20 23
Other income, net (14) (2)
-------- -------
Loss from continuing operations before
income taxes (12) (10)
Income tax expense 9 10
-------- -------
Loss from continuing operations (21) (20)
Earnings from discontinued operations - 5
Gain on sale of discontinued operations - 2
-------- -------
Net loss $ (21) $ (13)
======== =======
Basic and diluted earnings (loss) per common share:
Loss from continuing operations $ (0.09) $ (0.08)
Earnings from discontinued operations - 0.02
Gain on sale of discontinued operations - 0.01
-------- -------
Net loss $ (0.09) $ (0.05)
======== =======
Weighted average shares outstanding - basic and
diluted 242.1 241.1
======== =======
CHEMTURA CORPORATION
Consolidated Balance Sheets
(In millions)
March 31, December
2008 31,
2007
----------- --------
ASSETS (Unaudited)
CURRENT ASSETS
Cash and cash equivalents $ 115 $ 77
Accounts receivable 374 389
Inventories 707 676
Other current assets 251 239
----------- --------
Total current assets 1,447 1,381
----------- --------
NON-CURRENT ASSETS
Property, plant and equipment, net 975 1,032
Goodwill 1,320 1,309
Intangible assets, net 571 585
Other assets 120 109
----------- --------
$ 4,433 $ 4,416
=========== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term borrowings $ 16 $ 5
Accounts payable 317 285
Accrued expenses 319 353
Income taxes payable 40 38
----------- --------
Total current liabilities 692 681
----------- --------
NON-CURRENT LIABILITIES
Long-term debt 1,076 1,058
Pension and post-retirement health care
liabilities 359 361
Other liabilities 400 463
STOCKHOLDERS' EQUITY
Common stock 3 3
Additional paid-in capital 3,031 3,028
Accumulated deficit (1,212) (1,179)
Accumulated other comprehensive income 251 168
Treasury stock at cost (167) (167)
----------- --------
Total stockholders' equity 1,906 1,853
----------- --------
$ 4,433 $ 4,416
=========== ========
CHEMTURA CORPORATION
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In millions)
Three Months
Ended March 31,
----------------
Increase (decrease) to cash 2008 2007
---------------------------------------------------- ------- -------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (21) $ (13)
Adjustments to reconcile net loss to net
cash provided by (used in) operations:
Loss on sale of business 23 -
Gain on sale of discontinued operations - (2)
Depreciation and amortization 69 65
Stock-based compensation expense 3 3
Equity income, net of cash distributions (1) (1)
Changes in assets and liabilities, net (57) (83)
------- -------
Net cash provided by (used in) operations 16 (31)
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES
Net proceeds from divestments 62 -
Payments for acquisitions, net of cash acquired (26) (160)
Capital expenditures (23) (20)
------- -------
Net cash provided by (used in) investing
activities 13 (180)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from credit facility, net 50 240
Payments on long term borrowings (31) -
Proceeds from (payments on) short term borrowings 1 (22)
Dividends paid (12) (12)
Proceeds from exercise of stock options - 2
Other financing activities (1) (1)
------- -------
Net cash provided by financing activities 7 207
------- -------
CASH
Effect of exchange rates on cash and cash
equivalents 2 1
------- -------
Change in cash and cash equivalents 38 (3)
Cash and cash equivalents at beginning of period 77 95
------- -------
Cash and cash equivalents at end of period $ 115 $ 92
======= =======
CHEMTURA CORPORATION
Segment Net Sales and Operating (Loss) Profit (Unaudited)
(In millions)
Three Months
Ended March 31,
----------------
2008 2007
--------- -----
NET SALES
Polymer Additives $ 442 $ 444
Performance Specialties 255 211
Consumer Products 107 116
Crop Protection 89 81
Other 16 37
--------- -----
Total Net Sales $ 909 $ 889
========= =====
OPERATING (LOSS) PROFIT
Polymer Additives $ 8 $ 25
Performance Specialties 26 27
Consumer Products 1 (2)
Crop Protection 21 14
Other - (1)
--------- -----
56 63
--------- -----
General corporate expense, including
amortization (32) (23)
Accelerated depreciation of property, plant
and equipment (7) (14)
Facility closures, severance and related costs - (3)
Antitrust costs - (12)
Loss on sale of business (23) -
--------- -----
Total Operating (Loss) Profit $ (6) $ 11
========= =====
CHEMTURA CORPORATION
Major Factors Affecting Net Sales and Operating Results (Unaudited)
Three Months Ended March 31, 2008 versus 2007
(In millions)
The following table summarizes the major factors contributing to the
changes in operating results versus the prior year:
Three Months
Ended March 31,
-----------------
Pre-tax
Earnings
(Loss)
from
Net Continuing
Sales Operations
----- ----------
2007 $ 889 $ (10)
2007 Accelerated recognition of asset retirement
obligation - 3
2007 Accelerated depreciation of property, plant
and equipment - 14
2007 Facility closures, severance and related costs - 3
2007 Antitrust costs - 12
----- ----------
889 22
Higher selling prices 19 19
Unit volume and mix (7) (1)
Foreign currency impact 24 (3)
Acquisitions 20 4
Divestitures (36) 1
Manufacturing variances - 1
Higher raw materials/energy costs - (31)
Reductions in SGA&R, excluding foreign exchange
impact - 17
Lower A/R securitization fees - 2
Foreign exchange gain - 13
Lease accounting - (7)
Lower interest expense - 3
Other - (5)
----- ----------
909 35
2008 Accelerated recognition of asset retirement
obligation - (2)
2008 Accelerated depreciation of property, plant
and equipment - (22)
2008 Loss on sale of business - (23)
----- ----------
2008 $ 909 $ (12)
===== ==========
CHEMTURA CORPORATION
Managed Basis Consolidated Statements of Operations (Unaudited)
(In millions, except per share data)
Three Months Ended March Three Months Ended March
31, 2008 31, 2007
------------------------- -------------------------
Managed Managed
Basis Managed Basis Managed
GAAP Adjustment Basis GAAP Adjustment Basis
---- ---------- ------- ---- ---------- -------
Net sales $ 909 $ - $ 909 $ 889 $ - $ 889
Cost of goods
sold 725 (2) 723 687 (3) 684
Selling, general
and
administrative 85 - 85 98 - 98
Depreciation and
amortization 69 (22) 47 63 (14) 49
Research and
development 14 - 14 16 - 16
Facility
closures,
severance and
related costs - - - 3 (3) -
Antitrust costs - - - 12 (12) -
Loss on sale of
business 23 (23) - - - -
Equity income (1) - (1) (1) - (1)
---- ---------- ------- ---- ---------- -------
Operating (loss)
profit (6) 47 41 11 32 43
Interest expense 20 - 20 23 - 23
Other income,
net (14) - (14) (2) - (2)
---- ---------- ------- ---- ---------- -------
(Loss) earnings
from continuing
operations
before income
taxes (12) 47 35 (10) 32 22
Income tax
expense
(benefit) 9 3 12 10 (3) 7
---- ---------- ------- ---- ---------- -------
(Loss) earnings
from continuing
operations (21) 44 23 (20) 35 15
Earnings from
discontinued
operations - - - 5 - 5
Gain on sale of
discontinued
operations - - - 2 (2) -
---- ---------- ------- ---- ---------- -------
Net (loss)
earnings $(21) $ 44 $ 23 $(13) $ 33 $ 20
==== ========== ======= ==== ========== =======
Diluted earnings
from continuing
operations $ 0.10 $ 0.06
Diluted earnings
from
discontinued
operations - 0.02
------- -------
Diluted net
earnings $ 0.10 $ 0.08
======= =======
Diluted weighted
average shares
outstanding 242.1 242.2
======= =======
Three Three
Months Months
Ended Ended
Managed Basis March 31, March 31,
Adjustments consist 2008 2007
of the following:
---------------------- ---------- ----------
Accelerated
recognition of asset
retirement obligation $ 2 $ 3
Accelerated
depreciation of
property, plant and
equipment 22 14
Facility closures,
severance and related
costs - 3
Antitrust costs - 12
Loss on sale of
business 23 -
---------- ----------
Pre-Tax 47 32
Adjustment to apply a
managed basis
effective tax rate 3 (3)
---------- ----------
After-Tax 44 35
Gain on sale of
discontinued
operations - (2)
---------- ----------
Net Earnings $ 44 $ 33
========== ==========
CHEMTURA CORPORATION
Managed Basis Segment Net Sales and Operating (Loss) Profit
(Unaudited)
(In millions)
Three Months Ended March Three Months Ended March
31, 2008 31, 2007
------------------------- -------------------------
Managed Managed
Basis Managed Basis Managed
GAAP Adjustments Basis GAAP Adjustments Basis
----- ----------- ------- ----- ----------- -------
NET SALES
Polymer
Additives $ 442 $ - $ 442 $ 444 $ - $ 444
Performance
Specialties 255 - 255 211 - 211
Consumer
Products 107 - 107 116 - 116
Crop Protection 89 - 89 81 - 81
Other 16 - 16 37 - 37
---- -------- ---- ---- -------- ----
Total Net
Sales $ 909 $ - $ 909 $ 889 $ - $ 889
==== ======== ==== ==== ======== ====
OPERATING PROFIT
Polymer
Additives $ 8 $ 16 $ 24 $ 25 $ - $ 25
Performance
Specialties 26 1 27 27 - 27
Consumer
Products 1 - 1 (2) - (2)
Crop Protection 21 - 21 14 - 14
Other - - - (1) 3 2
---- -------- ---- ---- -------- ----
56 17 73 63 3 66
---- -------- ---- ---- -------- ----
General
corporate
expense,
including
amortization (32) - (32) (23) - (23)
Change in useful
life of
property, plant
and equipment (7) 7 - (14) 14 -
Facility
closures,
severance and
related cost - - - (3) 3 -
Antitrust costs - - - (12) 12 -
Loss on sale of
business (23) 23 - - - -
---- -------- ---- ---- -------- ----
Total
Operating
(Loss) Profit $ (6) $ 47 $ 41 $ 11 $ 32 $ 43
==== ======== ==== ==== ======== ====
DEPRECIATION AND
AMORTIZATION
Polymer
Additives $ 38 $ (14) $ 24 $ 21 $ - $ 21
Performance
Specialties 7 (1) 6 5 - 5
Consumer
Products 3 - 3 6 - 6
Crop Protection 2 - 2 1 - 1
Other - - - 1 - 1
General
corporate
expense,
including
amortization 19 (7) 12 29 (14) 15
---- -------- ---- ---- -------- ----
Total
Depreciation
and
Amortization $ 69 $ (22) $ 47 $ 63 $ (14) $ 49
==== ======== ==== ==== ======== ====
Three Three
Months Months
Ended Ended
Managed Basis March March
Adjustments consist of 31, 31,
the following: 2008 2007
------------------------ -------- --------
Accelerated recognition
of asset retirement
obligation $ 2 $ 3
Accelerated depreciation
of property, plant and
equipment 22 14
Facility closures,
severance and related
costs - 3
Antitrust costs - 12
Loss on sale of business 23 -
-------- --------
$ 47 $ 32
======== ========
SOURCE: Chemtura Corporation
Chemtura Corporation
Stephen Forsyth, 203-573-2213
Print Page | 
E-mail Page | 
RSS Feeds | 
E-mail Alerts | 
IR Contacts
