AKRON, Ohio, July 1, 2014 /PRNewswire/ --
-- Net income from continuing operations for the third quarter of fiscal 2014 was $19.1 million, or $0.65 per diluted share; adjusted net income from continuing operations for the third quarter of fiscal 2014, excluding certain items, was $21.8 million, or $0.74 per diluted share, a 48% improvement over the prior-year quarter -- The Company benefitted from both organic growth as well as acquisitions in the quarter -- Company raises full-year fiscal 2014 adjusted net income guidance to a range of $2.31 to $2.36 per diluted share
A. Schulman, Inc. (Nasdaq-GS: SHLM) announced today earnings for the fiscal 2014 third quarter ended May 31, 2014.
Joseph M. Gingo, Chairman, President and Chief Executive Officer, said, "I am pleased with our excellent third-quarter financial results which reflect continued demand in our key end markets as well as contributions from our recent acquisitions. Unlike last year's unusual third quarter, I believe we have returned to our typical historic pattern where our third quarter is the strongest. While our results are strong, we will continue to look for operational efficiencies, drive product mix improvement and seek acquisitions that expand our markets and provide profitable growth."
Bernard Rzepka, Chief Operating Officer, stated, "We are pleased with our global organic growth rate, particularly in Europe where improved mix and growing automotive sales have bolstered our quarter and nine-month results. Globally, we continue to achieve double-digit growth in our custom performance color product family. In Europe, Middle East and Africa (EMEA) we continue to see steady growth in other key markets such as packaging. In the Americas, we saw a similar pattern with strength in our engineered plastics product family as a result of our acquisitions, and we had significant contributions from our specialty powders business. In Asia Pacific (APAC), we continue to improve volume and sales by executing our growth activities aided by our recent Perrite acquisition. Globally, our recent acquisitions contributed to a 10.2% quarter-over-quarter increase in net sales. We expect this growth rate to continue now that we have closed on the acquisition of Ferro Corporation's specialty plastics business."
Fiscal Third-Quarter Results
In the fiscal 2014 third quarter, net sales in the EMEA segment increased 14% compared with the same period last year. During the quarter, the incremental contribution of the Perrite acquisition in EMEA was $22.2 million and 14.2 million pounds in net sales and volume, respectively. Additionally, sales and volume benefited from greater demand as a result of continued strengthening in the automotive market and consistent strength in the packaging market. Foreign currency translation positively impacted the segment's net sales by $21.6 million. EMEA gross profit was $56.8 million for the quarter, an increase of $8.1 million compared with the same three-month period last year. The increase in gross profit was primarily attributed to the incremental contribution of the Perrite acquisition, favorable product mix and overall higher volumes in all product families. Foreign currency translation positively impacted EMEA gross profit by $2.9 million.
Net sales for the Americas increased by 18.9% compared with the prior-year period. This increase was primarily driven by the incremental contributions of the Network Polymers and Prime Colorants acquisitions which totaled $20 million and 13.3 million pounds in net sales and volume, respectively. Foreign currency translation negatively impacted the segment's net sales by $5.1 million. Gross profit for the Americas was $28.3 million in the quarter, an increase of $8.3 million compared with the same period last year. Gross profit benefitted from recent acquisitions, improved mix, and prior restructuring initiatives which were partially offset by the increased variable incentive compensation expense of $0.5 million and unfavorable foreign currency translation of $0.6 million.
During the quarter, net sales for the Company's APAC segment increased approximately 52% compared with the same prior-year period. The contribution of the Perrite acquisition in APAC was $13.5 million and 10.1 million pounds in net sales and volume, respectively. Excluding the Perrite acquisition, volume increased by 22% but was partially offset by decreased price per pound driven by continued competitive pricing pressures primarily in the masterbatch business. Gross profit for APAC for the quarter increased 24% compared with the prior-year period. This increase was primarily attributed to the positive contribution from the Perrite acquisition. Gross profit percentage declined as a result of competitive pricing pressures and the broadening of the Company's product portfolio within the APAC region.
Year-to-Date Results
Net sales for the nine months ended May 31, 2014 were $1.8 billion, an increase of 14% compared with the same period last year. Incremental net sales and volume from the Company's recent acquisitions contributed $142.6 million and 98.1 million pounds, respectively. Excluding the impact of recent acquisitions, net sales were positively impacted by a 3.2% increase in price per pound and a 1.8% increase in volume. Foreign currency translation favorably impacted net sales by $30.8 million.
The Company's SG&A expenses, excluding certain items, increased $20.6 million compared with the same period in the prior year. The increase was primarily attributable to incremental SG&A expense of $7.6 million from recent acquisitions, higher variable incentive compensation expense of $9.4 million and unfavorable foreign currency translation of $2.5 million. SG&A expense, excluding certain items, was 9.6% of net sales for the nine-month period. Operating income increased $15.2 million for the nine months ended May 31, 2014, compared with the same prior-year period. Total operating income, before certain items, for the nine months ended May 31, 2014, was $72.1 million, an increase of $16.7 million compared with a year ago.
Working Capital/Cash Flow From Operations
Cash provided from operations was $35 million and $52.6 million for the nine months ended May 31, 2014 and 2013, respectively. The Company's cash and cash equivalents decreased $23.3 million from August 31, 2013. This decrease was driven primarily by fiscal 2014 acquisitions and was partially offset by an increase in net borrowings and cash generated from operations. Working capital was 60 days at the end of the fiscal 2014 third quarter, an increase of three days when compared with the same period last year.
Capital expenditures for the nine months were $24.1 million compared with $20.5 million last year. The Company continued regular and ongoing investments in the Company's global manufacturing facilities and technical innovation centers.
During the three- and nine-month periods ended May 31, 2014, the Company declared and paid quarterly cash dividends of $0.20 and $0.60 per common share, respectively. The total amount of these dividends was $5.9 million and $17.7 million, respectively.
Business Outlook
"We are pleased with the strength of our third-quarter and year-to-date results despite modest global economic growth. Our acquisitions, combined with the benefits of prior restructurings and our organic growth initiatives, are putting us on pace to deliver a record year for A. Schulman. Accordingly, we are raising our expectations for fiscal 2014 adjusted net income to be in a range of $2.31 to $2.36 per diluted share, which would represent an approximate 25% increase over the prior-year results using the high end of this range. This equates to a fourth-quarter adjusted net income expectation of between $0.61 and $0.66 per diluted share, which resumes a more historical trend of quarterly earnings given the normal holiday cycle in the U.S. and Europe in the July and August time period," Gingo said.
Conference Call on the Web
A live Internet broadcast of A. Schulman's conference call regarding fiscal 2014 third-quarter earnings can be accessed at 10:00 a.m. Eastern Time on Wednesday, July 2, 2014 on the Company's website, www.aschulman.com. An archived replay of the call will also be available on the website.
Investor Presentation Materials
Senior executives of the Company may participate in meetings with analysts and investors throughout the fiscal year. The Company has posted presentation materials, portions of which may be used during such meetings, in the Investors section of its website at www.aschulman.com. The presentation will remain on the website as long as it is in use.
About A. Schulman, Inc.
A. Schulman, Inc. is a leading international supplier of high-performance plastic compounds and resins headquartered in Akron, Ohio. Since 1928, the Company has been providing innovative solutions to meet its customers' demanding requirements. The Company's customers span a wide range of markets such as packaging, mobility, building & construction, electronics & electrical, agriculture, personal care & hygiene, sports, leisure & home, custom services and others. The Company employs approximately 3,800 people and has 43 manufacturing facilities globally. A. Schulman reported net sales of $2.1 billion for the fiscal year ended August 31, 2013. Additional information about A. Schulman can be found at www.aschulman.com.
Use of Non-GAAP Financial Measures
This release includes certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States ("GAAP"). These non-GAAP financial measures include segment gross profit, SG&A expenses excluding certain items, operating income excluding certain items, net income excluding certain items and net income per diluted share excluding certain items, as discussed further in the Reconciliation of GAAP and Non-GAAP Financial Measures below. These non-GAAP financial measures are considered relevant to aid analysis and understanding of the Company's results and business trends. However, non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures, and tables included in this release reconcile each non-GAAP financial measure with the most directly comparable GAAP financial measure. The most directly comparable GAAP financial measures for these purposes are gross profit, SG&A expenses, operating income, net income and net income per diluted share. The Company's non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures, and should be read only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP.
While the Company believes that these non-GAAP financial measures provide useful supplemental information to investors, there are very significant limitations associated with their use. These non-GAAP financial measures are not prepared in accordance with GAAP, may not be reported by all of the Company's competitors and may not be directly comparable to similarly titled measures of the Company's competitors due to potential differences in the exact method of calculation. The Company compensates for these limitations by using these non-GAAP financial measures as supplements to GAAP financial measures and by reviewing the reconciliations of the non-GAAP financial measures to their most comparable GAAP financial measures.
Cautionary Statements
A number of the matters discussed in this document that are not historical or current facts deal with potential future circumstances and developments and may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historic or current facts and relate to future events and expectations. Forward-looking statements contain such words 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. Forward-looking statements are based on management's current expectations and include known and unknown risks, uncertainties and other factors, many of which management is unable to predict or control, that may cause actual results, performance or achievements to differ materially from those expressed or implied in the forward-looking statements. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements, and that could adversely affect the Company's future financial performance, include, but are not limited to, the following:
-- worldwide and regional economic, business and political conditions, including continuing economic uncertainties in some or all of the Company's major product markets or countries where the Company has operations; -- the effectiveness of the Company's efforts to improve operating margins through sales growth, price increases, productivity gains, and improved purchasing techniques; -- competitive factors, including intense price competition; -- fluctuations in the value of currencies in areas where the Company operates; -- volatility of prices and availability of the supply of energy and raw materials that are critical to the manufacture of the Company's products, particularly plastic resins derived from oil and natural gas; -- changes in customer demand and requirements; -- effectiveness of the Company to achieve the level of cost savings, productivity improvements, growth and other benefits anticipated from acquisitions, joint ventures and restructuring initiatives; -- escalation in the cost of providing employee health care; -- uncertainties regarding the resolution of pending and future litigation and other claims; -- the performance of the global automotive market as well as other markets served; -- further adverse changes in economic or industry conditions, including global supply and demand conditions and prices for products; and -- operating problems with our information systems as a result of system security failures such as viruses, computer "hackers" or other causes.
The risks and uncertainties identified above are not the only risks the Company faces. Additional risk factors that could affect the Company's performance are set forth in the Company's Annual Report on Form 10-K for the fiscal year ended August 31, 2013. In addition, risks and uncertainties not presently known to the Company or that it believes to be immaterial also may adversely affect the Company. Should any known or unknown risks or uncertainties develop into actual events, or underlying assumptions prove inaccurate, these developments could have material adverse effects on the Company's business, financial condition and results of operations.
SHLM_ALL
www.aschulman.com
A. SCHULMAN, INC. CONSOLIDATED STATEMENTS OF OPERATIONS Three months ended May 31, Nine months ended May 31, -------------------------- ------------------------- 2014 2013 2014 2013 ---- ---- ---- ---- Unaudited (In thousands, except per share data) Net sales $645,735 $548,589 $1,819,640 $1,596,114 Cost of sales 553,771 474,545 1,574,269 1,387,206 Selling, general and administrative expenses 65,536 54,409 181,647 157,744 Restructuring expense 1,078 1,807 4,583 5,413 Asset impairment - 1,121 104 1,619 Curtailment (gain) loss - - - 333 --- --- --- --- Operating income 25,350 16,707 59,037 43,799 Interest expense 1,433 1,865 6,112 5,559 Interest income (68) (80) (211) (408) Foreign currency transaction (gains) losses (28) 139 2,120 676 Other (income) expense, net 4 (27) (267) (374) --- --- ---- ---- Income from continuing operations before taxes 24,009 14,810 51,283 38,346 Provision (benefit) for U.S. and foreign income taxes 4,662 4,497 12,657 3,584 ----- ----- ------ ----- Income from continuing operations 19,347 10,313 38,626 34,762 Income (loss) from discontinued operations, net of tax (23) (4,821) 2,979 (5,102) --- ------ ----- ------ Net income 19,324 5,492 41,605 29,660 Noncontrolling interests (233) (275) (584) (881) ---- ---- ---- ---- Net income attributable to A. Schulman, Inc. $19,091 $5,217 $41,021 $28,779 ======= ====== ======= ======= Weighted-average number of shares outstanding: Basic 29,081 29,316 29,052 29,275 Diluted 29,375 29,477 29,300 29,421 Basic earnings per share attributable to A. Schulman, Inc. Income from continuing operations $0.66 $0.34 $1.31 $1.16 Income (loss) from discontinued operations - (0.16) 0.10 (0.18) --- ----- ---- ----- Net income attributable to A. Schulman, Inc. $0.66 $0.18 $1.41 $0.98 ===== ===== ===== ===== Diluted earnings per share attributable to A. Schulman, Inc. Income from continuing operations $0.65 $0.34 $1.30 $1.15 Income (loss) from discontinued operations - (0.16) 0.10 (0.17) Net income attributable to A. Schulman, Inc. $0.65 $0.18 $1.40 $0.98 ===== ===== ===== ===== Cash dividends per common share $0.200 $0.195 $0.600 $0.585 ====== ====== ====== ======
A. SCHULMAN, INC. CONSOLIDATED BALANCE SHEETS May 31, August 31, 2014 2013 ---- ---- Unaudited (In thousands) ASSETS Current assets: Cash and cash equivalents $110,804 $134,054 Accounts receivable, and less $10,434 allowance at August for 31, 2013 doubtful accounts of $11,128 at May 31, 2014 384,988 310,749 Inventories, lower of average cost or market 307,960 261,658 Prepaid expenses and other current assets 46,992 41,224 ------ ------ Total current assets 850,744 747,685 ------- ------- Property, plant and equipment, at cost: Land and improvements 26,708 27,954 Buildings and leasehold improvements 158,458 146,647 Machinery and equipment 391,716 356,144 Furniture and fixtures 42,030 39,065 Construction in progress 10,902 7,149 ------ ----- Gross property, plant and equipment 629,814 576,959 Accumulated depreciation 397,025 366,438 Net property, plant and equipment 232,789 210,521 ------- ------- Deferred charges and other noncurrent assets 55,132 48,723 Goodwill 184,547 139,526 Intangible assets, net 116,224 91,887 ------- ------ Total assets $1,439,436 $1,238,342 ========== ========== LIABILITIES AND EQUITY Current liabilities: Accounts payable $310,098 $265,477 U.S. and foreign income taxes payable 8,838 6,423 Accrued payroll, taxes and related benefits 50,527 43,072 Other accrued liabilities 44,618 48,689 Short- term debt 21,955 8,373 ------ ----- Total current liabilities 436,036 372,034 Long-term debt 292,742 207,435 Pension plans 103,639 98,599 Deferred income taxes 23,769 20,873 Other long- term liabilities 24,968 24,657 Total liabilities 881,154 723,598 ------- ------- Commitments and contingencies Stockholders' equity: Common stock, $1 2014 and par 48,094 value, shares at authorized August -75,000 31, 2013 shares, issued - 48,183 shares at May 31, 48,183 48,094 Additional paid-in capital 268,326 263,158 Accumulated other comprehensive income (loss) 16,192 682 Retained earnings 597,674 574,370 Treasury stock, at cost, 18,874 shares at May 31, 2014 and 18,940 shares at August 31, 2013 (379,922) (378,927) -------- -------- Total A. Schulman, Inc.'s stockholders' equity 550,453 507,377 ------- ------- Noncontrolling interests 7,829 7,367 ----- ----- Total equity 558,282 514,744 Total liabilities and equity $1,439,436 $1,238,342 ========== ==========
A. SCHULMAN, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS Nine months ended May 31, ------------------------- 2014 2013 ---- ---- Unaudited (In thousands) Operating from continuing and discontinued operations: Net income $41,605 $29,660 Adjustments to reconcile net income to net cash provided from (used in) operating activities: Depreciation 24,751 22,489 Amortization 10,308 8,665 Deferred tax provision (3,182) (8,879) Pension, postretirement benefits and other deferred compensation 9,157 6,465 Asset impairment 104 5,619 Curtailment (gain) loss - 333 Gain on sale of assets from discontinued operations (3,344) - Changes in assets and liabilities, net of acquisitions: Accounts receivable (26,048) (13,123) Inventories (15,330) (18,841) Accounts payable 2,847 27,092 Income taxes 204 (1,157) Accrued payroll and other accrued liabilities 260 2,034 Other assets and long- term liabilities (6,296) (7,780) ------ ------ Net cash provided from (used in) operating activities 35,036 52,577 ------ ------ Investing from continuing and discontinued operations: Expenditures for property, plant and equipment (24,126) (20,518) Proceeds from the sale of assets 5,255 11,745 Business acquisitions, net of cash (115,624) (36,360) -------- ------- Net cash provided from (used in) investing activities (134,495) (45,133) -------- ------- Financing from continuing and discontinued operations: Cash dividends paid (17,717) (17,313) Increase (decrease) in short- term debt 3,747 (28,086) Borrowings on long-term debt 703,141 134,097 Repayments on long-term debt (609,501) (89,241) Payment of debt issuance costs (1,782) - Issuances of stock, common and treasury 403 1,469 Redemptions of common stock (361) (397) Purchases of treasury stock (1,116) (1,021) ------ ------ Net cash provided from (used in) financing activities 76,814 (492) ------ ---- Effect of exchange rate changes on cash (605) (895) ---- ---- Net increase (decrease) in cash and cash equivalents (23,250) 6,057 ------- ----- Cash and cash equivalents at beginning of period 134,054 124,031 Cash and cash equivalents at end of period $110,804 $130,088 ======== ========
A. SCHULMAN, INC. Reconciliation of GAAP and Non-GAAP Financial Measures Three months ended May 31, 2014 Cost of Sales Gross SG&A Restructuring Asset Operating income Operating Income tax Net income margin expense impairment income per expense attributable to pound (benefit) A. Schulman, Inc. Diluted EPS ------------------------------- ------------- ------ ---- -------------- ----------- ---------------- ---------- ----------- ---------------- ----------- (In thousands, except for %'s, per pound and per share data) As reported $553,771 14.2% $65,536 $1,078 $ - $25,350 $0.046 $4,662 $19,091 $0.65 Certain items: Asset write-downs (1) - - - - - - - - Costs related to acquisitions (2) - (888) - - 888 16 872 0.03 Restructuring and related costs (3) (149) (933) (1,078) - 2,160 320 1,840 0.06 Inventory step-up (4) - - - - - - - - Tax benefits (charges) - - - - - - - - Loss (income) from discontinued operations 23 - --- --- Total certain items $(149) 0.1% $(1,821) $(1,078) $ - $3,048 $0.006 $336 $2,735 $0.09 ----- --- ------- ------- --- --- ------ ------ ---- ------ ----- As Adjusted $553,622 14.3% $63,715 $ - $ - $28,398 $0.052 $4,998 $21,826 $0.74 ======== ==== ======= === === === === ======= ====== ====== ======= ===== Percentage of Revenue 9.9% 4.4% 3.4% === === === Three months ended May 31, 2013 Cost of Sales Gross SG&A Restructuring Asset Operating income Operating Income tax Net income margin expense impairment income per expense attributable to pound (benefit) A. Schulman, Inc. Diluted EPS ------------------------------- ------------- ------ ---- -------------- ----------- ---------------- ---------- ----------- ---------------- ----------- (In thousands, except for %'s, per pound and per share data) As reported $474,545 13.5% $54,409 $1,807 $1,121 $16,707 $0.034 $4,497 $5,217 $0.18 Certain items: Asset write-downs (1) (265) - - (1,121) 1,386 - 1,386 0.05 Costs related to acquisitions (2) - (849) - - 849 (41) 890 0.03 Restructuring and related costs (3) (56) (1,303) (1,807) - 3,166 694 2,472 0.08 Inventory step-up (4) - - - - - - - - Tax benefits (charges) - - - - - 17 (17) - Loss (income) from discontinued operations 4,821 0.16 ----- ---- Total certain items $(321) 0.1% $(2,152) $(1,807) $(1,121) $5,401 $0.011 $670 $9,552 $0.32 ----- ------- ------- ------- ------ ------ ---- ------ ----- As Adjusted $474,224 13.6% $52,257 $ - $ - $22,108 $0.045 $5,167 $14,769 $0.50 ======== ==== ======= === === === === ======= ====== ====== ======= ===== Percentage of Revenue 9.5% 4.0% 2.7% === === ===
A. SCHULMAN, INC. Reconciliation of GAAP and Non-GAAP Financial Measures (Continued) Nine months ended May 31, 2014 Cost of Sales Gross SG&A Restructuring Asset Operating income Operating Income tax Net income margin expense impairment income per expense attributable to pound (benefit) A. Schulman, Inc. Diluted EPS ------------------------------ ------------- ------ ---- -------------- ----------- ---------------- ---------- ----------- ---------------- ----------- (In thousands, except for %'s, per pound and per share data) As reported $1,574,269 13.5% $181,647 $4,583 $104 $59,037 $0.038 $12,657 $41,021 $1.40 Certain items: Asset write-downs (1) (108) - - (104) 212 34 178 0.01 Costs related to acquisitions (2) (34) (3,343) - - 3,377 141 3,244 0.11 Restructuring and related costs (3) (649) (3,090) (4,583) 8,322 920 7,692 0.26 Inventory step-up (4) (1,199) - - - 1,199 98 1,101 0.04 Tax benefits (charges) - - - - - 427 (427) (0.02) Loss (income) from discontinued operations (2,979) (0.10) ------ ----- Total certain items $(1,990) 0.1% $(6,433) $(4,583) $(104) $13,110 $0.009 $1,620 $8,809 $0.30 ------- --- ------- ------- ----- ------- ------ ------ ------ ----- As Adjusted $1,572,279 13.6% $175,214 $ - $ - $72,147 $0.047 $14,277 $49,830 $1.70 ========== ==== ======== === === === === ======= ====== ======= ======= ===== Percentage of Revenue 9.6% 4.0% 2.7% === === === Nine months ended May 31, 2013 Cost of Sales Gross SG&A Restructuring Asset Operating income Operating Income tax Net income margin expense impairment income per expense attributable to pound (benefit) A. Schulman, Inc. Diluted EPS ------------------------------ ------------- ------ ---- -------------- ----------- ---------------- ---------- ----------- ---------------- ----------- (In thousands, except for %'s, per pound and per share data) As reported $1,387,206 13.1% $157,744 $5,413 $1,619 $43,799 $0.031 $3,584 $28,779 $0.98 Certain items: Asset write-downs (1) (947) - - (1,619) 2,566 149 2,417 0.08 Costs related to acquisitions (2) - (1,837) - - 1,837 38 1,799 0.06 Restructuring and related costs (3) (56) (1,303) (5,413) - 7,105 1,551 5,554 0.19 Inventory step-up (4) (138) - - - 138 - 138 - Tax benefits (charges) (5) - - - - - 6,177 (6,177) (0.21) Loss (income) from discontinued operations 5,102 0.18 ----- Total certain items $(1,141) 0.1% $(3,140) - $(5,413) - $(1,619) $11,646 $0.008 $7,915 $8,833 $0.30 ------- === ------- ------- ------- ------- ------ ------ ------ ----- As Adjusted $1,386,065 13.2% $154,604 $ - $ - $55,445 $0.039 $11,499 $37,612 $1.28 ========== ==== ======== === === === === ======= ====== ======= ======= ===== Percentage of Revenue 9.7% 3.5% 2.4% === === === 1 - Asset write-downs primarily relate to asset impairments and accelerated depreciation. 2 - Costs related to acquisitions include third party professional, legal and other expenses associated with successful and unsuccessful full or partial acquisition and divestiture/dissolution transactions, as well as certain employee-related expenses such as travel, one-time bonuses and post-acquisition severance separate from a formal restructuring plan. 3 - Restructuring related costs include items such as employee severance charges, lease termination charges, curtailment gains/losses, other employee termination costs and charges related to the reorganization of the legal entity structure. 4 - Inventory step-up costs include the adjustment for fair value of inventory acquired as a result of acquisition purchase accounting. 5 - Tax benefits (charges) include the effect of the adjustments to the Germany and Brazil valuation allowances in fiscal 2013.
A. SCHULMAN, INC. SUPPLEMENTAL SEGMENT INFORMATION Net Sales Pounds Sold --------- ----------- Three months ended May 31, -------------------------- EMEA 2014 2013 $ Change % Change 2014 2013 Lbs. Change % Change ---- ---- ---- -------- -------- ---- ---- ----------- -------- (In thousands, except for %'s) Masterbatch Solutions $122,450 $112,077 $10,373 9.3% 94,228 91,307 2,921 3.2% Engineered Plastics 123,634 94,417 29,217 30.9% 77,649 59,022 18,627 31.6% Distribution Services 80,666 76,671 3,995 5.2% 96,600 95,211 1,389 1.5% Specialty Powders 47,533 44,091 3,442 7.8% 47,193 45,712 1,481 3.2% Custom Performance Colors 39,505 35,591 3,914 11.0% 13,114 12,410 704 5.7% ------ ------ ----- ------ ------ --- Total EMEA $413,788 $362,847 $50,941 14.0% 328,784 303,662 25,122 8.3% ======== ======== ======= ==== ======= ======= ====== === Net Sales Pounds Sold --------- ----------- Three months ended May 31, -------------------------- Americas 2014 2013 $ Change % Change 2014 2013 Lbs. Change % Change -------- ---- ---- -------- -------- ---- ---- ----------- -------- (In thousands, except for %'s) Masterbatch Solutions $67,164 $65,836 $1,328 2.0% 75,371 76,033 (662) (0.9)% Engineered Plastics 49,307 33,992 15,315 45.1% 31,454 19,340 12,114 62.6% Distribution Services 12,408 12,048 360 3.0% 13,195 13,666 (471) (3.4)% Specialty Powders 45,503 35,442 10,061 28.4% 53,410 51,334 2,076 4.0% Custom Performance Colors 7,017 5,217 1,800 34.5% 2,593 2,038 555 27.2% ----- ----- ----- ----- ----- --- Total Americas $181,399 $152,535 $28,864 18.9% 176,023 162,411 13,612 8.4% ======== ======== ======= ==== ======= ======= ====== === Net Sales Pounds Sold --------- ----------- Three months ended May 31, -------------------------- APAC 2014 2013 $ Change % Change 2014 2013 Lbs. Change % Change ---- ---- ---- -------- -------- ---- ---- ----------- -------- (In thousands, except for %'s) Masterbatch Solutions $21,272 $19,156 $2,116 11.0% 19,652 15,721 3,931 25.0% Engineered Plastics 23,803 10,161 13,642 134.3% 15,788 5,457 10,331 189.3% Distribution Services 512 19 493 n/a 618 13 605 n/a Specialty Powders 4,085 3,860 225 5.8% 3,651 3,612 39 1.1% Custom Performance Colors 876 11 865 n/a 738 2 736 n/a --- --- --- -------- --- --- --- Total APAC $50,548 $33,207 $17,341 52.2% 40,447 24,805 15,642 63.1% ======= ======= ======= ==== ====== ====== ====== ==== Net Sales Pounds Sold --------- ----------- Three months ended May 31, -------------------------- Consolidated 2014 2013 $ Change % Change 2014 2013 Lbs. Change % Change ------------ ---- ---- -------- -------- ---- ---- ----------- -------- (In thousands, except for %'s) Masterbatch Solutions $210,886 $197,069 $13,817 7.0% 189,251 183,061 6,190 3.4% Engineered Plastics 196,744 138,570 58,174 42.0% 124,891 83,819 41,072 49.0% Distribution Services 93,586 88,738 4,848 5.5% 110,413 108,890 1,523 1.4% Specialty Powders 97,121 83,393 13,728 16.5% 104,254 100,658 3,596 3.6% Custom Performance Colors 47,398 40,819 6,579 16.1% 16,445 14,450 1,995 13.8% ------ ------ ----- ------ ------ ----- Total Consolidated $645,735 $548,589 $97,146 17.7% 545,254 490,878 54,376 11.1% ======== ======== ======= ==== ======= ======= ====== ====
A. SCHULMAN, INC. SUPPLEMENTAL SEGMENT INFORMATION (continued) Net Sales Pounds Sold --------- ----------- Nine months ended May 31, ------------------------- EMEA 2014 2013 $ Change % Change 2014 2013 Lbs. % Change Change --- ------ (In thousands, except for %'s) Masterbatch Solutions $336,976 $333,824 $3,152 0.9% 262,785 261,954 831 0.3% Engineered Plastics 360,983 267,777 93,206 34.8% 222,411 165,748 56,663 34.2% Distribution Services 241,884 237,162 4,722 2.0% 288,278 287,741 537 0.2% Specialty Powders 137,941 117,220 20,721 17.7% 136,660 125,359 11,301 9.0% Custom Performance Colors 111,490 100,550 10,940 10.9% 37,086 34,591 2,495 7.2% ------- ------- ------ ------ ------ ----- --- Total EMEA $1,189,274 $1,056,533 $132,741 12.6% 947,220 875,393 71,827 8.2% ========== ========== ======== ==== ======= ======= ====== === Net Sales Pounds Sold --------- ----------- Nine months ended May 31, ------------------------- Americas 2014 2013 $ Change % Change 2014 2013 Lbs. % Change Change --- ------ (In thousands, except for %'s) Masterbatch Solutions $193,590 $194,579 $(989) (0.5)% 213,900 219,305 (5,405) (2.5)% Engineered Plastics 124,277 103,963 20,314 19.5% 78,196 62,659 15,537 24.8% Distribution Services 34,701 33,793 908 2.7% 37,667 39,962 (2,295) (5.7)% Specialty Powders 114,879 99,449 15,430 15.5% 151,102 151,680 (578) (0.4)% Custom Performance Colors 17,578 14,530 3,048 21.0% 6,626 5,454 1,172 21.5% ------ ------ ----- ----- ----- ----- Total Americas $485,025 $446,314 $38,711 8.7% 487,491 479,060 8,431 1.8% ======== ======== ======= === ======= ======= ===== === Net Sales Pounds Sold --------- ----------- Nine months ended May 31, ------------------------- APAC 2014 2013 $ Change % Change 2014 2013 Lbs. % Change Change --- ------ (In thousands, except for %'s) Masterbatch Solutions $61,681 $57,136 $4,545 8.0% 55,126 45,931 9,195 20.0% Engineered Plastics 69,085 25,556 43,529 170.3% 45,381 13,688 31,693 231.5% Distribution Services 1,315 38 1,277 n/a 1,622 26 1,596 n/a Specialty Powders 11,111 10,288 823 8.0% 10,074 10,053 21 0.2% Custom Performance Colors 2,149 249 1,900 n/a 1,700 81 1,619 n/a ----- --- ----- ----- --- ----- Total APAC $145,341 $93,267 $52,074 55.8% 113,903 69,779 44,124 63.2% ======== ======= ======= ==== ======= ====== ====== ==== Net Sales Pounds Sold --------- ----------- Nine months ended May 31, ------------------------- Consolidated 2014 2013 $ Change % Change 2014 2013 Lbs. % Change Change --- ------ (In thousands, except for %'s) Masterbatch Solutions $592,247 $585,539 $6,708 1.1% 531,811 527,190 4,621 0.9% Engineered Plastics 554,345 397,296 157,049 39.5% 345,988 242,095 103,893 42.9% Distribution Services 277,900 270,993 6,907 2.5% 327,567 327,729 (162) - % Specialty Powders 263,931 226,957 36,974 16.3% 297,836 287,092 10,744 3.7% Custom Performance 131,217 115,329 15,888 13.8% 45,412 40,126 5,286 13.2% Colors Total Consolidated $1,819,640 $1,596,114 $223,526 14.0% 1,548,614 1,424,232 124,382 8.7% ========== ========== ======== ==== ========= ========= ======= ===
A. SCHULMAN, INC. SUPPLEMENTAL SEGMENT INFORMATION (continued) Three months ended May 31, Nine months ended May 31, -------------------------- ------------------------- 2014 2013 2014 2013 ---- ---- ---- ---- Unaudited (In thousands, except for %'s) Segment gross profit EMEA $56,798 $48,684 $156,237 $133,715 Americas 28,263 19,994 70,922 60,155 APAC 7,052 5,687 20,202 16,179 ----- ----- ------ ------ Total segment gross profit 92,113 74,365 247,361 210,049 Inventory step-up - - (1,199) (138) Accelerated depreciation and restructuring related (149) (321) (791) (1,003) ---- ---- ---- ------ Total gross profit $91,964 $74,044 $245,371 $208,908 ======= ======= ======== ======== Segment operating income EMEA $23,565 $20,222 $61,537 $47,888 Americas 11,257 5,340 24,889 18,977 APAC 3,328 2,738 9,870 8,231 ----- ----- ----- ----- Total segment operating income 38,150 28,300 96,296 75,096 Corporate (9,752) (6,192) (24,149) (19,651) Costs related to acquisitions (888) (849) (3,377) (1,837) Restructuring and related costs (2,160) (3,166) (8,322) (6,772) Accelerated depreciation - (265) (108) (947) Asset impairment - (1,121) (104) (1,619) Curtailment gain (loss) - - - (333) Inventory step-up - - (1,199) (138) --- --- ------ ---- Operating income 25,350 16,707 59,037 43,799 Interest expense, net (1,365) (1,785) (5,901) (5,151) Foreign currency transaction gains (losses) 28 (139) (2,120) (676) Other income (expense), net (4) 27 267 374 --- --- Income from continuing operations before taxes $24,009 $14,810 $51,283 $38,346 ======= ======= ======= ======= Capacity utilization EMEA 87% 81% 84% 77% Americas 67% 67% 65% 65% APAC 73% 66% 71% 69% Worldwide 77% 74% 74% 71%
SOURCE A. Schulman, Inc.