OLIN CORPORATION CLAYTON, Mo., July 30, 2015 /PRNewswire/ -- Olin Corporation (NYSE: OLN) announced today that its second quarter 2015 income from continuing operations was $42.3 million, or $0.54 per diluted share, which compares to income from continuing operations of $36.6 million, or $0.46 per diluted share in the second quarter of 2014. Sales in the second quarter of 2015 were $535.4 million compared to $570.4 million in the second quarter of 2014.
Second quarter 2015 results included a pretax gain of $52.2 million related to property damage and business interruption insurance recoveries resulting from the June 2014 incident at one of the two chlor alkali production units at our Becancour, Canada facility. Second quarter 2015 results also included pretax acquisition-related financing and other costs of $22.1 million, increased legacy environmental costs of $3.9 million and pretax restructuring charges of $0.7 million.
Joseph D. Rupp, Chairman and Chief Executive Officer said, "We continue to focus significant effort preparing for the Dow transaction. All anti-trust approvals have been received and we now expect to close early in the fourth quarter. We remain excited and confident that the transaction will be value creating and we believe we can generate at least $200 million in annual synergies within three years after closing. Some of the key benefits Olin expects from the acquisition will come from a significant reduction in the average cost to manufacture an ECU; a meaningful reduction in the annual number of miles chlorine is shipped by rail; and the opportunity to continue to expand our sales of bleach. We are also pleased that the current leaders and their respective management teams of global epoxy, chlor alkali vinyls, chlorinated organics, and global chlor alkali manufacturing have all agreed to join Olin at closing.
"As the second quarter of 2015 ended and the third quarter began, it became clear that our expectation that improving demand for chlorine and caustic soda would lead to meaningfully higher ECU netbacks in 2015, would not materialize. Chlorine pricing has improved in our system but has been more than offset by weaker caustic soda pricing. As a result, we now expect Chlor Alkali segment earnings will decline in 2015 compared to 2014 but will be partially offset by improved Chemical Distribution segment earnings. Without giving consideration to the impact of the Dow acquisition in the fourth quarter, due to the lack of significant improvement in ECU netbacks for 2015, we are reducing our full year adjusted EBITDA forecast to the $330 million to $360 million range.
"Third quarter 2015 net income is forecast to be in the $0.05 to $0.10 per diluted share range, which includes pretax acquisition-related costs and financing expenses of approximately $17 million and $8 million, respectively. Chlor Alkali third quarter 2015 earnings are expected to be lower than the third quarter of 2014 segment earnings, primarily due to lower caustic soda volumes. Third quarter 2015 Chemical Distribution earnings are expected to be higher than second quarter 2015 segment earnings primarily due to the seasonal increase in bleach volumes and continued earnings contributions from Olin-produced hydrochloric acid and potassium hydroxide sales. In the Winchester business, third quarter 2015 earnings are expected to be comparable to third quarter 2014 levels. Third quarter 2015 results are also forecast to include approximately $6 million of higher legacy environmental costs compared to the third quarter of 2014. Third quarter 2015 earnings are also expected to include restructuring charges of approximately $1 million."
SEGMENT REPORTING
We define segment earnings as income (loss) from continuing operations before interest expense, interest income, other operating income (expense), other income (expense) and income taxes and include the earnings of non-consolidated affiliates in segment results consistent with management's monitoring of the operating segments.
CHLOR ALKALI PRODUCTS
Chlor Alkali Products sales for the second quarter of 2015 were $294.7 million compared to $338.5 million in the second quarter of 2014. Second quarter 2015 chlorine and caustic soda volumes decreased 12% compared to second quarter 2014 levels, and ECU netbacks declined approximately 1% in the second quarter of 2015 compared to the second quarter of 2014. Second quarter 2015 potassium hydroxide volumes decreased 10% compared to the second quarter of 2014 and hydrochloric acid volumes decreased 12% during the second quarter of 2015 compared to the second quarter of 2014. Bleach volumes increased 2% in the second quarter of 2015 compared to the second quarter of 2014. Second quarter 2015 Chlor Alkali segment earnings of $25.0 million decreased compared to $40.8 million in the second quarter of 2014, primarily due to lower chlorine and caustic soda volumes, lower ECU netbacks, and higher maintenance turnaround costs of approximately $7 million. These second quarter segment results included a gain of $9.9 million, from the Becancour, Canada property insurance recoveries, related to costs incurred and expensed in prior periods.
CHEMICAL DISTRIBUTION
Chemical Distribution sales in the second quarter of 2015 were $70.3 million compared to $75.6 million in the second quarter of 2014. The year-over-year decrease in Chemical Distribution sales reflects lower caustic soda selling prices and volumes, partially offset by higher shipments of hydrochloric acid and potassium hydroxide. Chemical Distribution segment earnings of $2.4 million in the second quarter of 2015 increased compared to breakeven segment earnings in the second quarter of 2014, primarily due to increased caustic soda margins and higher shipments of bleach, hydrochloric acid and potassium hydroxide. Chemical Distribution second quarter 2015 and 2014 results both included depreciation and amortization expense of $3.9 million.
WINCHESTER
Winchester second quarter of 2015 sales were $194.2 million compared to $181.0 million in the second quarter of 2014. The increase in second quarter of 2015 sales compared to the second quarter of 2014 reflects increased shipments to commercial, law enforcement and military customers. Winchester's second quarter 2015 segment earnings were $33.9 million compared to $33.1 million in the second quarter of 2014. The increase in segment earnings reflects the impact of lower commodity and material costs and lower manufacturing and other costs, partially offset by a less favorable product mix.
CORPORATE AND OTHER COSTS
Pension income included in the second quarter 2015 Corporate and Other segment was $7.4 million compared to $7.5 million in the second quarter of 2014.
Second quarter 2015 charges to income for environmental investigatory and remedial activities were $5.1 million compared to $1.2 million in the second quarter of 2014. These charges relate primarily to remedial and investigatory activities associated with former waste sites and past operations.
Other corporate and unallocated costs in the second quarter of 2015 decreased $1.4 million compared to the second quarter of 2014, primarily due to lower stock-based compensation expense, including mark-to-market adjustments and lower legal and legal-related settlement costs, partially offset by higher non-income tax expense.
PROPOSED ACQUISITION
On March 27, 2015, Olin and The Dow Chemical Company (TDCC) announced that Olin had agreed to acquire certain chlor alkali and downstream derivatives businesses from TDCC using a Reverse Morris Trust structure. Second quarter 2015 results included acquisition-related costs of $10.5 million and acquisition financing expenses included in interest expense of $11.6 million related to this pending transaction.
During the second quarter, the required waiting period under the Hart-Scott Rodino (HSR) Antitrust Improvements Act of 1976 expired and on July 6, 2015, Olin announced that all foreign regulatory approvals required to close the pending transaction had been obtained. The transaction is still subject to approval by Olin shareholders and other customary closing conditions. The transaction is expected to close early in the fourth quarter of 2015. In connection with the pending transaction, Olin entered into a $1.85 billion new senior unsecured credit facility, including a $1.35 billion 5-year term loan and a $0.5 billion revolving credit facility, which will replace Olin's current senior credit facility.
DIVIDEND
On July 23, 2015, Olin's Board of Directors declared a dividend of $0.20 on each share of Olin common stock. The dividend is payable on September 10, 2015 to shareholders of record at the close of business on August 10, 2015. This will be the 355th consecutive quarterly dividend to be paid by the Company.
CONFERENCE CALL INFORMATION
The Company's second quarter earnings conference call with securities analysts is scheduled for 10:00 A.M. Eastern Time, Friday, July 31. The call will feature remarks by Joseph D. Rupp, Olin's Chairman and Chief Executive Officer; John E. Fischer, Olin's President and Chief Operating Officer; John L. McIntosh, Olin's Senior Vice President, Chemicals; Todd A. Slater, Olin's Vice President and Chief Financial Officer; and Larry P. Kromidas, Olin's Assistant Treasurer and Director, Investor Relations. Anyone wishing to listen to the call may do so via the Internet by following the instructions posted under the Conference Call icon on Olin's website, olin.com. Listeners should log on to the website 15 minutes prior to the call. The call will also be audio archived on the Olin website for future replay beginning at 12:00 P.M. Eastern Time. A final transcript of the conference call will be available on the website in the Investor section the following day.
COMPANY DESCRIPTION
Olin Corporation is a manufacturer concentrated in three business segments: Chlor Alkali Products, Chemical Distribution and Winchester. Chlor Alkali Products, with eight U. S. manufacturing facilities and one Canadian manufacturing facility, produces chlorine and caustic soda, hydrochloric acid, hydrogen, bleach products and potassium hydroxide. Chemical Distribution manufactures bleach products and distributes caustic soda, bleach products, potassium hydroxide and hydrochloric acid. Winchester, with its principal manufacturing facilities in East Alton, IL and Oxford, MS, produces and distributes sporting ammunition, law enforcement ammunition, reloading components, small caliber military ammunition and components, and industrial cartridges.
Visit olin.com for more information on Olin.
FORWARD-LOOKING STATEMENTS
This communication includes forward-looking statements. These statements relate to analyses and other information that are based on management's beliefs, certain assumptions made by management, forecasts of future results, and current expectations, estimates and projections about the markets and economy in which we and our various segments operate. These statements may include statements regarding the proposed acquisition of certain chlor alkali and downstream derivatives businesses from TDCC using a "Reverse Morris Trust" structure, the expected timetable for completing the transaction, benefits and synergies of the transaction, and future opportunities for the combined company following the transaction. The statements contained in this communication that are not statements of historical fact may include forward-looking statements that involve a number of risks and uncertainties.
We have used the words "anticipate," "intend," "may," "expect," "believe," "should," "plan," "project," "estimate," "forecast," "optimistic," and variations of such words and similar expressions in this communication to identify such forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions, which are difficult to predict and many of which are beyond our control. Therefore, actual outcomes and results may differ materially from those matters expressed or implied in such forward-looking statements. We undertake no obligation to update publicly any forward-looking statements, whether as a result of future events, new information or otherwise. Relative to the dividend, the payment of cash dividends is subject to the discretion of our board of directors and will be determined in light of then-current conditions, including our earnings, our operations, our financial conditions, our capital requirements and other factors deemed relevant by our board of directors. In the future, our board of directors may change our dividend policy, including the frequency or amount of any dividend, in light of then-existing conditions.
The risks, uncertainties and assumptions involved in our forward-looking statements, many of which are discussed in more detail in our filings with the SEC, including without limitation the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2014, include, but are not limited to, the following:
-- sensitivity to economic, business and market conditions in the United
States and overseas, including economic instability or a downturn in the
sectors served by us, such as ammunition, vinyls, urethanes, and pulp
and paper, and the migration by United States customers to low-cost
foreign locations;
-- the cyclical nature of our operating results, particularly declines in
average selling prices in the chlor alkali industry and the
supply/demand balance for our products, including the impact of excess
industry capacity or an imbalance in demand for our chlor alkali
products;
-- economic and industry downturns that result in diminished product demand
and excess manufacturing capacity in any of our segments and that, in
many cases, result in lower selling prices and profits;
-- new regulations or public policy changes regarding the transportation of
hazardous chemicals and the security of chemical manufacturing
facilities;
-- changes in legislation or government regulations or policies;
-- higher-than-expected raw material and energy, transportation, and/or
logistics costs;
-- costs and other expenditures in excess of those projected for
environmental investigation and remediation or other legal proceedings;
-- unexpected litigation outcomes;
-- the failure or an interruption of our information technology systems;
-- the occurrence of unexpected manufacturing interruptions and outages,
including those occurring as a result of labor disruptions and
production hazards;
-- adverse conditions in the credit and capital markets, limiting or
preventing our ability to borrow or raise capital;
-- weak industry conditions could affect our ability to comply with the
financial maintenance covenants in our senior revolving credit facility
and certain tax-exempt bonds;
-- the effects of any declines in global equity markets on asset values and
any declines in interest rates used to value the liabilities in our
pension plan;
-- an increase in our indebtedness or higher-than-expected interest rates,
affecting our ability to generate sufficient cash flow for debt service;
-- factors relating to the satisfaction of the conditions to the proposed
transaction with TDCC, including regulatory approvals and the required
approvals of our shareholders;
-- our and TDCC's ability to meet expectations regarding the timing,
completion and accounting and tax treatments of the transaction with
TDCC;
-- the possibility that we may be unable to achieve expected synergies and
operating efficiencies in connection with the transaction with TDCC
within the expected time-frames or at all;
-- integration of TDCC's chlorine products business being more difficult,
time-consuming or costly than expected;
-- the effect of any changes resulting from the proposed transaction in
customer, supplier and other business relationships;
-- general market perception of the proposed transaction with TDCC; and
-- exposure to lawsuits and contingencies associated with TDCC's chlorine
products business.
All of our forward-looking statements should be considered in light of these factors. In addition, other risks and uncertainties not presently known to us or that we consider immaterial could affect the accuracy of our forward-looking statements.
Additional Information and Where to Find It
In connection with the proposed combination of Olin with the chlorine products business of TDCC, Blue Cube Spinco Inc. ("Spinco") has filed a registration statement on Form S-4 and Form S-1 containing a prospectus and Olin has filed a preliminary proxy statement on Schedule 14A and a registration statement on Form S-4 containing a prospectus with the U.S. Securities and Exchange Commission (the "SEC"). Both Olin and Spinco expect to file amendments to these filings before they become effective. INVESTORS AND SECURITYHOLDERS ARE ADVISED TO READ THE REGISTRATION STATEMENTS/PROSPECTUSES AND PROXY STATEMENT AND ANY AMENDMENTS THERETO WHEN THEY BECOME AVAILABLE, AS WELL AS ANY OTHER RELEVANT DOCUMENTS WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT OLIN, TDCC, SPINCO AND THE PROPOSED TRANSACTION. Investors and securityholders may obtain a free copy of the registration statements/prospectuses and preliminary proxy statement and any further amendments (when available) and other documents filed by Olin, TDCC and Spinco with the SEC at the SEC's website at http://www.sec.gov. Free copies of these documents and any further amendments, once available, and each of the companies' other filings with the SEC, may also be obtained from the respective companies by directing a request to Olin at Olin Corporation, ATTN: Investor Relations, 190 Carondelet Plaza, Suite 1530, Clayton, Missouri 63105 or TDCC or Spinco at The Dow Chemical Company, 2030 Dow Center, Midland, Michigan 48674, ATTN: Investor Relations, as applicable.
Participants in Solicitation
This communication is not a solicitation of a proxy from any investor or securityholder. However, Olin, TDCC, Spinco and certain of their respective directors, executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies from shareholders of Olin in respect of the proposed transaction under the rules of the SEC. Information regarding Olin's directors and executive officers is available in Olin's 2014 Annual Report on Form 10-K filed with the SEC on February 25, 2015, and in its definitive proxy statement for its 2015 Annual Meeting of Shareholders filed March 4, 2015. Information regarding TDCC's directors and executive officers is available in TDCC's Annual Report on Form 10-K filed with the SEC on February 13, 2015, and in its definitive proxy statement for its annual meeting of shareholders filed March 27, 2015. These documents can be obtained free of charge from the sources indicated above. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the registration statements, prospectuses and proxy statement and other relevant materials filed with the SEC in connection with the proposed transaction.
Non-Solicitation
This communication shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
2015-17
Olin Corporation
Consolidated Statements of Income(a)
-----------------------------------
Three Months Six Months
Ended June 30, Ended June 30,
(In millions, except per share amounts) 2015 2014 2015 2014
-------------------------------------- ---- ---- ---- ----
Sales $535.4 $570.4 $1,053.4 $1,147.8
Operating Expenses:
Cost of Goods Sold 445.5 463.6 878.7 939.0
Selling and Administration 39.9 41.7 86.9 85.2
Restructuring Charges (b) 0.7 2.3 1.9 3.3
Acquisition-related Costs (c) 10.5 0.2 20.9 0.4
Other Operating Income (d) 42.4 0.9 42.2 0.8
------------------------- ---- --- ---- ---
Operating Income 81.2 63.5 107.2 120.7
Earnings of Non-consolidated Affiliates 0.4 0.5 0.8 0.9
Interest Expense (e) 18.2 9.6 25.3 19.3
Interest Income 0.3 0.4 0.6 0.7
--------------- --- --- --- ---
Income from Continuing Operations before Taxes 63.7 54.8 83.3 103.0
Income Tax Provision 21.4 18.2 27.9 36.9
-------------------- ---- ---- ---- ----
Income from Continuing Operations, Net 42.3 36.6 55.4 66.1
Income from Discontinued Operations, Net (f) - 0.7 - 0.7
--------------------------
Net Income $42.3 $37.3 $55.4 $66.8
---------- ----- ----- ----- -----
Net Income Per Common Share:
Basic Income per Common Share:
Income from Continuing Operations, Net $0.55 $0.46 $0.71 $0.84
Income from Discontinued Operations, Net - 0.01 - 0.01
---------------------------------------- --- ---- --- ----
Net Income $0.55 $0.47 $0.71 $0.85
---------- ----- ----- ----- -----
Diluted Income per Common Share:
Income from Continuing Operations, Net $0.54 $0.46 $0.70 $0.82
Income from Discontinued Operations, Net - 0.01 - 0.01
---------------------------------------- --- ---- --- ----
Net Income $0.54 $0.47 $0.70 $0.83
---------- ----- ----- ----- -----
Dividends Per Common Share $0.20 $0.20 $0.40 $0.40
-------------------------- ----- ----- ----- -----
Average Common Shares Outstanding - Basic 77.5 78.8 77.5 79.0
-----------------------------------------
Average Common Shares Outstanding - Diluted 78.7 80.0 78.6 80.2
------------------------------------------- ---- ---- ---- ----
(a) Unaudited.
(b) Restructuring charges for the
three and six months ended
June 30, 2015 were
associated with permanently
closing a portion of the
Becancour, Canada chlor
alkali facility and the
ongoing relocation of our
Winchester centerfire
ammunition manufacturing
operations from East Alton,
IL to Oxford, MS.
Restructuring charges for
the three and six months
ended June 30, 2014 were
associated with exiting the
use of mercury cell
technology in the chlor
alkali manufacturing process
and the ongoing relocation
of our Winchester centerfire
ammunition manufacturing
operations from East Alton,
IL to Oxford, MS.
(c) Acquisition-related costs
for the three and six months
ended June 30, 2015 and 2014
were associated with Olin's
pending acquisition of a
significant portion of The
Dow Chemical Company's chlor
alkali and downstream
derivatives businesses.
(d) Other operating income for
the three and six months
ended June 30, 2015 included
$42.3 million of insurance
recoveries for property
damage and business
interruption related to the
portion of the Becancour,
Canada chlor alkali facility
that has been shut down
since late June 2014. Other
operating income for the
three and six months ended
June 30, 2014 included a
gain of $1.0 million for the
resolution of a contract
matter.
(e) Interest expense for the
three and six months ended
June 30, 2015 included
acquisition financing
expenses of $11.6 million
and $12.0 million,
respectively, for the bridge
financing associated with
Olin's pending acquisition
of a significant portion of
The Dow Chemical Company's
chlor alkali and downstream
derivatives businesses.
(f) Income from discontinued
operations, net for the
three and six months ended
June 30, 2014 included a
$0.7 million after tax gain
for the favorable resolution
of certain indemnity
obligations related to our
Metals business sold in
2007.
Olin Corporation
Segment Information(a)
Three Months Six Months
Ended June 30, Ended June 30,
(In millions) 2015 2014 2015 2014
------------ ---- ---- ---- ----
Sales:
Chlor Alkali Products $294.7 $338.5 $587.4 $666.8
Chemical Distribution 70.3 75.6 140.1 144.8
Winchester 194.2 181.0 372.9 381.6
Intersegment Sales Elimination (b) (23.8) (24.7) (47.0) (45.4)
--------------------------------- ----- ----- ----- -----
Total Sales $535.4 $570.4 $1,053.4 $1,147.8
----------- ------ ------ -------- --------
Income (Loss) from Continuing Operations before Taxes:
Chlor Alkali Products (c) $25.0 $40.8 $48.1 $75.1
Chemical Distribution 2.4 - 3.4 (0.8)
Winchester 33.9 33.1 63.7 71.4
Corporate/Other:
Pension Income (d) 7.4 7.5 14.5 15.4
Environmental Expense (5.1) (1.2) (5.8) (4.7)
Other Corporate and Unallocated Costs (13.2) (14.6) (35.3) (31.9)
Restructuring Charges (e) (0.7) (2.3) (1.9) (3.3)
Acquisition-related Costs (f) (10.5) (0.2) (20.9) (0.4)
Other Operating Income (g) 42.4 0.9 42.2 0.8
Interest Expense (h) (18.2) (9.6) (25.3) (19.3)
Interest Income 0.3 0.4 0.6 0.7
Income from Continuing Operations before Taxes $63.7 $54.8 $83.3 $103.0
---------------------------------------------- ----- ----- ----- ------
(a) Unaudited.
(b) Intersegment sales elimination
represents the sale of caustic
soda, bleach, potassium hydroxide,
and hydrochloric acid between
Chemical Distribution and Chlor
Alkali Products, at prices that
approximate market.
(c) Earnings of non-consolidated
affiliates are included in the
Chlor Alkali Products segment
results consistent with
management's monitoring of the
operating segments. The earnings
from non-consolidated affiliates
were $0.4 million and $0.5 million
for the three months ended June
30, 2015 and 2014, respectively,
and $0.8 million and $0.9 million
for the six months ended June 30,
2015 and 2014, respectively.
(d) The service cost and the
amortization of prior service cost
components of pension expense
related to the employees of the
operating segments are allocated
to the operating segments based on
their respective estimated census
data. All other components of
pension costs are included in
Corporate/Other and include items
such as the expected return on
plan assets, interest cost and
recognized actuarial gains and
losses.
(e) Restructuring charges for the three
and six months ended June 30, 2015
were associated with permanently
closing a portion of the
Becancour, Canada chlor alkali
facility and the ongoing
relocation of our Winchester
centerfire ammunition
manufacturing operations from East
Alton, IL to Oxford, MS.
Restructuring charges for the
three and six months ended June
30, 2014 were associated with
exiting the use of mercury cell
technology in the chlor alkali
manufacturing process and the
ongoing relocation of our
Winchester centerfire ammunition
manufacturing operations from East
Alton, IL to Oxford, MS.
(f) Acquisition-related costs for the
three and six months ended June
30, 2015 and 2014 were associated
with Olin's pending acquisition of
a significant portion of The Dow
Chemical Company's chlor alkali
and downstream derivatives
businesses.
(g) Other operating income for the
three and six months ended June
30, 2015 included $42.3 million of
insurance recoveries for property
damage and business interruption
related to the portion of the
Becancour, Canada chlor alkali
facility that has been shut down
since late June 2014. Other
operating income for the three and
six months ended June 30, 2014
included a gain of $1.0 million
for the resolution of a contract
matter.
(h) Interest expense for the three and
six months ended June 30, 2015
included acquisition financing
expenses of $11.6 million and
$12.0 million, respectively, for
the bridge financing associated
with Olin's pending acquisition of
a significant portion of The Dow
Chemical Company's chlor alkali
and downstream derivatives
businesses.
Olin Corporation
Consolidated Balance Sheets (a)
June 30, December 31, June 30,
(In millions, except per share data) 2015 2014 2014
----------------------------------- ---- ---- ----
Assets:
Cash & Cash Equivalents $232.4 $256.8 $245.6
Accounts Receivable, Net 321.3 263.1 341.2
Income Taxes Receivable 3.2 21.6 9.2
Inventories 221.6 210.1 220.9
Current Deferred Income Taxes 49.7 54.2 48.3
Other Current Assets 16.1 10.3 13.8
-------------------- ---- ---- ----
Total Current Assets 844.3 816.1 879.0
Property, Plant and Equipment
(Less Accumulated Depreciation of $1,385.6, $1,330.7 and $1,316.4) 917.6 931.0 951.3
Prepaid Pension Costs - - 1.7
Restricted Cash - - 2.6
Deferred Income Taxes 13.1 12.5 8.9
Other Assets 179.0 191.4 200.1
Goodwill 747.1 747.1 747.1
-------- ----- ----- -----
Total Assets $2,701.1 $2,698.1 $2,790.7
------------ -------- -------- --------
Liabilities and Shareholders' Equity:
Current Installments of Long-Term Debt $143.9 $16.4 $12.6
Accounts Payable 148.6 146.8 186.8
Income Taxes Payable 11.1 0.2 0.4
Accrued Liabilities 205.4 214.3 194.5
------------------- ----- ----- -----
Total Current Liabilities 509.0 377.7 394.3
Long-Term Debt 528.2 658.7 676.6
Accrued Pension Liability 152.5 182.0 87.9
Deferred Income Taxes 99.5 107.1 130.9
Other Liabilities 359.4 359.3 377.2
----------------- ----- ----- -----
Total Liabilities 1,648.6 1,684.8 1,666.9
----------------- ------- ------- -------
Commitments and Contingencies
Shareholders' Equity:
Common Stock, Par Value $1 Per Share, Authorized 120.0 Shares:
Issued and Outstanding 77.5 Shares (77.4 and 78.6 in 2014) 77.5 77.4 78.6
Additional Paid-In Capital 794.2 788.3 818.5
Accumulated Other Comprehensive Loss (434.3) (443.1) (356.4)
Retained Earnings 615.1 590.7 583.1
Total Shareholders' Equity 1,052.5 1,013.3 1,123.8
-------------------------- ------- ------- -------
Total Liabilities and Shareholders' Equity $2,701.1 $2,698.1 $2,790.7
------------------------------------------ -------- -------- --------
(a) Unaudited.
Olin Corporation
Consolidated Statements of Cash Flows(a)
Six Months
Ended June 30,
(In millions) 2015 2014
------------ ---- ----
Operating Activities:
Net Income $55.4 $66.8
Earnings of Non-consolidated Affiliates (0.8) (0.9)
Gains on Disposition of Property, Plant and Equipment (23.7) (0.6)
Stock-Based Compensation 3.7 2.4
Depreciation and Amortization 69.1 69.4
Deferred Income Taxes (10.0) 10.5
Qualified Pension Plan Contributions (0.3) (0.4)
Qualified Pension Plan Income (14.0) (14.3)
Changes in:
Receivables (58.2) (61.1)
Income Taxes Receivable/Payable 29.3 (8.6)
Inventories (11.5) (34.4)
Other Current Assets (5.8) 3.3
Accounts Payable and Accrued Liabilities (5.7) 8.2
Other Assets 18.8 2.0
Other Noncurrent Liabilities 1.7 (5.1)
Other Operating Activities 0.1 0.2
-------------------------- --- ---
Net Operating Activities 48.1 37.4
------------------------ ---- ----
Investing Activities:
Capital Expenditures (51.1) (32.5)
Proceeds from Disposition of Property, Plant and Equipment 24.7 1.8
Proceeds from Disposition of Affiliated Companies 4.4 -
Restricted Cash Activity - 1.6
Other Investing Activities (1.1) 1.0
-------------------------- ---- ---
Net Investing Activities (23.1) (28.1)
------------------------ ----- -----
Financing Activities:
Long-Term Debt Repayments (2.1) (0.2)
Earn Out Payment - SunBelt - (14.8)
Common Stock Repurchased and Retired - (29.7)
Stock Options Exercised 2.1 5.4
Excess Tax Benefits from Stock-Based Compensation 0.3 0.7
Dividends Paid (31.0) (31.7)
Deferred Debt Issuance Costs (18.7) (1.2)
Net Financing Activities (49.4) (71.5)
------------------------ ----- -----
Net Decrease in Cash and Cash Equivalents (24.4) (62.2)
Cash and Cash Equivalents, Beginning of Year 256.8 307.8
-------------------------------------------- ----- -----
Cash and Cash Equivalents, End of Period $232.4 $245.6
---------------------------------------- ------ ------
(a) Unaudited.
Olin Corporation
Non-GAAP Financial Measures (a)
Olin's definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is income from continuing operations, net plus an add-back for depreciation and amortization,
interest expense (income), income tax expense, other expense (income) and acquisition-related costs. Adjusted EBITDA is a non-GAAP financial measure. Management believes that this measure is
meaningful to investors as a supplemental financial measure to assess the financial performance of our assets without regard to financing methods, capital structures, taxes, or historical cost basis.
The use of non-GAAP financial measures is not intended to replace any measures of performance determined in accordance with GAAP and Adjusted EBITDA presented may not be comparable to similarly titled
measures of other companies.
Three Months Six Months
Ended June 30, Ended June 30,
(In millions) 2015 2014 2015 2014
------------ ---- ---- ---- ----
Reconciliation of Income from Continuing Operations, Net to Adjusted EBITDA:
Income from Continuing Operations, Net $42.3 $36.6 $55.4 $66.1
Add Back:
Interest Expense (b) 18.2 9.6 25.3 19.3
Interest Income (0.3) (0.4) (0.6) (0.7)
Income Tax Expense 21.4 18.2 27.9 36.9
Depreciation and Amortization 34.7 35.2 69.1 69.4
----------------------------- ---- ---- ---- ----
EBITDA 116.3 99.2 177.1 191.0
Add Back:
Acquisition-related Costs (c) 10.5 0.2 20.9 0.4
---- --- ---
Adjusted EBITDA $126.8 $99.4 $198.0 $191.4
--------------- ------ ----- ------ ------
(a) Unaudited.
(b) Interest expense for the
three and six months ended
June 30, 2015 included
acquisition financing
expenses of $11.6 million
and $12.0 million,
respectively, for the bridge
financing associated with
Olin's pending acquisition
of a significant portion of
The Dow Chemical Company's
chlor alkali and downstream
derivatives businesses.
(c) Acquisition-related costs
for the three and six months
ended June 30, 2015 and 2014
were associated with Olin's
pending acquisition of a
significant portion of The
Dow Chemical Company's chlor
alkali and downstream
derivatives businesses.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/olin-announces-second-quarter-2015-earnings-300121659.html
SOURCE Olin Corporation
