Chemtura Corporation, (NYSE: CHMT) (the “Company,” “Chemtura,”
“Registrant,” “We,” “Us” and “Our”) reports a net loss from
continuing operations attributable to Chemtura on a GAAP basis of
$367 million, or $2.25 per share, for the fourth quarter of 2010
and net earnings on a managed basis of $7 million, or $0.04 per
share.
Fourth Quarter 2010 Financial Results
The discussion below includes financial information on both a
GAAP and managed basis. We present managed basis financial
information as management uses this information internally to
evaluate and direct the performance of our operations and believes
that the managed basis financial information provides useful
information to investors. A reconciliation of GAAP and managed
basis financial information is provided in the supplemental
schedules included in this release.
The following is a summary of fourth
quarter financial results on a GAAP basis:
(In millions, except per share data)
Fourth quarter
2010 2009
% change Net sales $ 680
$ 598 14 % Operating loss $ (29 )
$ (31 ) 6 % Loss from continuing operations, net of
tax $ (367 ) $ (94 ) NM
Loss from continuing operations, net of
tax - per
share
$ (2.25 ) $ (0.38 ) NM
NM = Not Meaningful
The following is a summary of
fourth quarter financial results on a managed basis:
(In millions, except per share data)
Fourth quarter
2010 2009
% change Net sales $ 680 $ 598
14 % Operating profit $ 34 $ 45 (24 %) Net
earnings attributable to Chemtura $ 7 $ 15 (53
%) Net earnings attributable to Chemtura - per share $ 0.04
$ 0.06 (33 %)
CEO Quote
“Chemtura has successfully emerged from its Chapter 11
reorganization, leaner, fitter and with a much stronger balance
sheet, fulfilling the goals we set for this process,” commented
Craig A. Rogerson, Chairman, President and CEO. “We are focused on
innovation, profitable growth, particularly from those regions that
offer the highest growth rates, execution with an emphasis on
meeting customer needs, and active portfolio management. These
strategies, together with cyclical recovery in some of the
industries we serve, enabled us to exceed our financial targets for
2010 and lay the foundation for further improvement in 2011.”
Mr. Rogerson further noted, “With our focus on innovation, in
2010, we commercialized new products in all of our segments and we
expanded our sales to the Asia Pacific region by 52%. As a result,
this region grew to 19% of our total revenues in 2010. We focused
our portfolio with the divestiture of the PVC Additives business in
the second quarter of 2010 and continued to improve operating
efficiency through a number of restructuring initiatives, raw
material including the launch of our operational improvement plan
in El Dorado, Arkansas. We exceeded our financial targets in 2010
despite the difficulties faced by our Chemtura AgroSolutionsTM
business and the headwinds of rapidly inflating raw material costs.
In the fourth quarter, we improved our execution on recovering raw
material cost increases with the net deficit between input cost and
selling price increases declining to $5 million, compared to the
$15 million we experienced in the third quarter of 2010. This
remains an intense area of focus as we enter 2011.”
Mr. Rogerson concluded, “All connected with Chemtura enter 2011
invigorated by all we have achieved in 2010 and all the many
opportunities we have ahead of us. Our solid operating performance
in 2010, which included exceeding our fourth quarter and full year
projections, reflected in these financial results lays the
foundation for further significant improvement in 2011. Our
performance targets for 2011 are appropriately aggressive and we
have plans and actions in place to achieve them.”
Fourth Quarter 2010 Significant Events
- On November 10, 2010, we announced that
we had successfully completed our financial restructuring and
emerged from protection under Chapter 11 of the United States
Bankruptcy Code. In connection with our emergence, our new common
stock was listed on the New York Stock Exchange (“NYSE”), and on
November 11, 2010, our new common stock started trading on the NYSE
under the ticker symbol “CHMT.” In accordance with the confirmed
plan of reorganization (the “Plan”), we have fully satisfied
creditors' allowed claims (including interest) in cash and/or stock
in the reorganized Company and also provided a prorated value to
equity holders.
- With the successful completion of our
financial restructuring, we have significantly reduced our debt,
improved our cost structure and resolved a considerable number of
environmental and other liabilities.
- We continually monitor and evaluate
business and competitive conditions that may affect the carrying
value of our goodwill by segment. We have previously disclosed
risks inherent in our Chemtura AgroSolutions™ financial projections
as a result of the recent below-expectation performance of this
business. Given another quarter of missed expectations, we
determined that the goodwill associated with this business could
not be sustained. As such, we recorded a non-cash charge of $57
million to reduce the carrying value of goodwill associated with
this segment.
Fourth Quarter 2010 Business Segment Highlights
- Industrial Performance Products’ net
sales increased 9% or $24 million driven primarily by increased
sales volume and higher selling prices, partially offset by
unfavorable foreign currency translation and the sale of the sodium
sulfonate business. The higher sales volume in the fourth quarter
of 2010 was due to increased demand across our customers’ industry
segments, as well as strong growth in the Asia Pacific region.
Operating profit declined $7 million as the benefit of higher
volume and higher selling prices were offset by the greater impact
of higher raw material and energy costs, higher distribution costs
and the sale of the sodium sulfonate business.
- Industrial Engineered Products’ net
sales increased 33% or $47 million primarily due to increased sales
volume and higher selling prices. Operating profit on a managed
basis increased $10 million from the fourth quarter of 2009
primarily due to higher selling prices, increased volume and
favorable product mix, partially offset by higher raw material and
energy costs and unfavorable manufacturing costs. On a GAAP basis,
operating profit increased $6 million and was impacted by
accelerated depreciation charges resulting from restructuring
initiatives in this segment.
- Consumer Products’ net sales of $89
million were unchanged from the fourth quarter of 2009. Operating
profit on a managed basis declined $4 million primarily due to
higher raw material and energy costs. On a GAAP basis, operating
profit decreased $3 million.
- Chemtura AgroSolutionsTM net sales
increased 13% or $11 million primarily due to increased sales
volume. Sales were higher in all regions as compared with the
fourth quarter of 2009. Operating profit of $9 million was
unchanged as the impact of increased volume was offset by higher
raw material and other costs.
- Corporate expense for the fourth
quarter of 2010 was $29 million compared with $20 million in 2009.
Corporate expense included amortization expense related to
intangibles of $9 million and $10 million for the fourth quarter of
2010 and 2009, respectively. The increase in Corporate expense was
primarily due to $6 million of stock-based compensation expense
associated with our emergence incentive award plans.
Fourth Quarter 2010 Results - GAAP
- Net sales for the fourth quarter of
2010 were $680 million, an increase of $82 million compared with
fourth quarter 2009 net sales of $598 million. The increase in net
sales was attributable to increased sales volumes of $65 million
and an increase in selling prices of $25 million, partially offset
by unfavorable foreign currency translation of $2 million and the
sale of the sodium sulfonate business which reduced revenues by $6
million compared with 2009.
- Gross profit for the fourth quarter of
2010 was $164 million, a decrease of $2 million compared with the
same quarter last year. Gross profit as a percentage of sales
decreased to 24% in the quarter as compared with 28% in the same
quarter last year primarily due to the lag between increases in raw
material costs and the resulting increases in selling prices. The
decrease in gross profit was primarily due to higher raw material
costs of $30 million and unfavorable manufacturing and other
variable costs of $15 million. These unfavorable impacts were
partially offset by $25 million in higher selling prices and $18
million from the impact of higher sales volume (net of product mix
impacts).
- The operating loss for the fourth
quarter of 2010 was $29 million compared with an operating loss of
$31 million for the fourth quarter of 2009. The decrease in
operating loss was primarily due to a $71 million decrease in
changes in estimates related to expected allowable claims
(primarily related to revised estimates for legal and environmental
liabilities) and a $1 million increase in equity income, which was
offset by a $55 million increase in impairment charges, a $12
million increase in selling, general and administrative and
research and development costs (collectively “SGA&R”), a $2
million decrease in gross profit and a $1 million increase in
depreciation and amortization. SGA&R included an expense of $7
million for stock-based compensation expense associated with our
emergence incentive plans.
- Interest expense of $27 million in the
fourth quarter of 2010 was $10 million higher than the same period
in 2009. Had we emerged from Chapter 11 on October 1, 2010, the
amount of interest we would have recorded during the fourth quarter
of 2010 would have been approximately $15 million. The increased
interest in the quarter was the result of recording interest
expense associated with $455 million in aggregate principal amount
of the Senior Notes and the $295 million Term Loan (both issued as
part of the exit financing facilities contemplated under the Plan),
and interest on claims for the Chapter 11 pre-emergence period,
partially offset by lower financing costs under the Amended DIP
Credit Facility entered into in February 2010 compared with the
same period in 2009.
- The loss on early extinguishment of
debt included $70 million related to make-whole and no-call claim
settlements relating to our legacy bonds and $5 million related to
the termination of the Amended DIP Credit facility agreement and
completion of exit financing as a result of our emergence from
Chapter 11.
- Other expense, net was $4 million in
the fourth quarter of 2010 compared to other expense, net of $6
million for the fourth quarter of 2009.
- Reorganization items, net in the fourth
quarter of 2010 was $223 million compared with $31 million in the
fourth quarter of 2009. Reorganization items primarily comprised
professional fees directly associated with the Chapter 11
reorganization and the impact of the claims settlement process. The
increase is primarily due to higher professional fees and
settlement losses incurred upon the consummation of our confirmed
Plan.
- Net loss from continuing operations
attributable to Chemtura for the fourth quarter of 2010 was $367
million, or $2.25 per share, compared with net loss from continuing
operations attributable to Chemtura of $94 million, or $0.38 per
share, for the fourth quarter of 2009.
- Earnings from discontinued operations
for the fourth quarter of 2009 was $4 million, which represented
the operations of the PVC additives business.
- The gain on sale of discontinued
operations in the fourth quarter of 2009 was $1 million.
Fourth Quarter 2010 Results - Managed Basis
- On a managed basis, fourth quarter 2010
gross profit was $164 million, or 24% of net sales, as compared
with fourth quarter 2009 gross profit of $166 million, or 28% of
net sales. Higher raw material, energy and other costs were
principally offset by the benefit of increases in selling prices
and higher sales volume (net of product mix impacts).
- On a managed basis, fourth quarter 2010
operating profit was $34 million as compared with fourth quarter
2009 operating profit of $45 million. The decrease in operating
profit primarily reflected the increase in SGA&R resulting from
stock-based compensation expense associated with our emergence
incentive awards.
- Adjusted EBITDA in the fourth quarter
of 2010 was $79 million as compared with $84 million in the fourth
quarter 2009. The decrease in adjusted EBITDA was primarily due to
higher SGA&R expense.
- The earnings from continuing operations
before income taxes on a managed basis in the fourth quarter of
2010 and 2009 exclude pre-tax GAAP charges of $369 million and $107
million, respectively. These charges are primarily related to
accelerated depreciation of property, plant and equipment;
impairment charges; changes in estimates related to expected
allowable claims; losses on early extinguishment of debt;
post-petition interest expense on allowable claims; and costs
associated with the Chapter 11 reorganization.
- Chemtura’s managed basis tax rate of
35% represents a standard tax rate for our core operations to
simplify comparison of underlying operating performance during the
course of the Chapter 11 proceedings. With our emergence from
Chapter 11, we are reassessing the rate that should be used in 2011
and will disclose our conclusion in our first quarter 2011 earnings
release.
Cash Flows - GAAP
- Net cash used in operating activities
for the fourth quarter of 2010 was $245 million as compared with
net cash provided by operating activities of $23 million for the
fourth quarter of 2009. The decrease is primarily related to cash
payments made as part of the settlement of Chapter 11 claims upon
emergence in accordance with our confirmed Plan.
- As of December 31, 2010, our accounts
receivable balances from continuing operations were $489 million as
compared with $496 million as of September 30, 2010, $560 million
as of June 30, 2010, $521 million as of March 31, 2010 and $442
million as of December 31, 2009. Accounts receivable measured as
days sales outstanding as of December 31, 2010 showed improvement
compared with the measure as of December 31, 2009.
- As of December 31, 2010, our inventory
balance from continuing operations was $528 million as compared
with $533 million as of September 30, 2010, $496 million as of June
30, 2010, $515 million at March 31, 2010 and $489 million at
December 31, 2009. Inventory measured as days in inventory as of
December 31, 2010 showed improvement compared with the measure as
of December 31, 2009.
- Capital expenditures for the fourth
quarter of 2010 were $62 million compared with $33 million in the
same period of 2009.
- Our total debt of $751 million as of
December 31, 2010 compared with $1,430 million as of December 31,
2009. The decrease is due to the payment of the Chapter 11 claims
as a result of our emergence from Chapter 11. Cash and cash
equivalents were $201 million as of December 31, 2010 compared with
$263 million as of September 30, 2010.
- We are monitoring the current strength
of the leveraged loan market and evaluating an opportunistic
re-pricing and moderate upsize of our existing $295 million Term
Loan. An upsize transaction, if consummated, would result in a
modest change to our senior secured leverage ratio and projected
interest expense.
Fourth Quarter and Full Year Earnings Q&A
Teleconference
Copies of this release, as well as informational slides, will be
available on the Investor Relations section on our Web site at
www.chemtura.com. We will host a teleconference to review these
results on Tuesday, March 8, 2011 at 10 a.m. EST. Interested
parties are asked to dial in approximately 10 minutes prior to the
start time. The call-in number is (404) 665-9523 and the conference
ID code is 38225213. Replay of the call will be available for two
weeks, starting at noon EST on Tuesday, March 8, 2011. To access
the replay, call (800) 642-1687 or (706) 645-9291 and enter access
code 38225213.
Live Internet access to the 2010 fourth quarter and full year
conference call will be available through the Investor Relations
section of our Web site.
Chemtura Corporation, with 2010 sales of $2.8 billion, is a
global manufacturer and marketer of specialty chemicals,
agrochemicals and pool, spa and home care products. Additional
information concerning us is available at www.chemtura.com.
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”). Our managed
basis financial measures consist of adjusted results of operations
that exclude certain expenses, gains and losses that may not be
indicative of our core operations. Excluded items include costs
associated with the bankruptcy reorganization; facility closures,
severance and related costs; antitrust costs; gains and losses on
sale of business; increased depreciation due to the change in
useful life of assets; unusual and non-recurring settlements;
accelerated recognition of asset retirement obligations and
impairment charges. In addition to the managed basis financial
measures discussed above, we have applied a managed basis effective
income tax rate to our managed basis income before taxes. Our
managed basis tax rate of 35% represents a standard tax rate for
our core operations to simplify comparison of underlying operating
performance used in 2009 and 2010. We are evaluating the rate that
should be used in 2011 and the rate is therefore subject to change.
Reconciliations of these managed basis financial measures to their
most directly comparable GAAP financial measures are provided in
the attached financial tables. We believe that such managed basis
financial measures provide useful information to investors and may
assist them in evaluating our underlying performance and
identifying operating trends. In addition, management uses these
managed basis financial measures internally to allocate resources
and evaluate the performance of our operations. While we believe
that such measures are useful in evaluating our 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 our performance relative to other
companies in similar industries.
Forward-Looking Statements
This document includes forward-looking statements within the
meaning of Section 27(a) of the Securities Act of 1933, as amended
and Section 21(e) of the Exchange Act of 1934, as amended. 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:
- The cyclical nature of the global
chemicals industry;
- Increases in the price of raw materials
or energy and our ability to recover cost increases through
increased selling prices for our products;
- Disruptions in the availability of raw
materials or energy;
- Declines in general economic
conditions;
- The effects of competition;
- The ability to comply with product
registration requirements under European Union REACh
legislation;
- The effect of adverse weather
conditions;
- The ability to grow profitability in
our Chemtura AgroSolutions™ segment;
- Demand for Chemtura AgroSolutions™
segment products being affected by governmental policies;
- The ability to implement the El Dorado,
Arkansas restructuring program;
- Current and future litigation,
governmental investigations, prosecutions and administrative
claims;
- Environmental, health and safety
regulation matters;
- Federal regulations aimed at increasing
security at certain chemical production plants;
- Significant international operations
and interests;
- Our ability to maintain adequate
internal controls over financial reporting;
- Exchange rate and other currency
risks;
- Our dependence upon a trained,
dedicated sales force;
- Operating risks at our production
facilities;
- Our ability to protect our patents or
other intellectual property rights;
- Whether our patents may not provide
full protection against competing manufacturers;
- Our ability to remain technologically
innovative and to offer improved products and services in a
cost-effective manner;
- The risks to our joint venture
investments resulting from lack of sole decision making
authority;
- Our unfunded and underfunded defined
benefit pension plans and post-retirement welfare benefit
plans;
- Whether we are required to fund the
pension plan of our U.K. subsidiary;
- Risks associated with possible climate
change legislation, regulation and international accords;
- The ability to support the carrying
value of the goodwill and long-lived assets related to our
businesses; and
- Other risks and uncertainties detailed
in Item 1A. Risk Factors in our filings with the Securities and
Exchange Commission.
These statements are based on our estimates and assumptions and
on currently available information. Our forward-looking statements
include information concerning possible or assumed future results
of operations, and our 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. We
undertake no duty to update any forward-looking statements to
conform the statements to actual results or changes in our
operations.
CHEMTURA CORPORATION Index of Financial Statements
and Schedules
Page Financial Statements
Consolidated Statements of Operations (Unaudited) -
Quarters and Years Ended ended December 31, 2010 and 2009
9
Consolidated Balance Sheets - December 31,
2010 and December 31, 2009
10 Condensed Consolidated Statements of Cash Flows
(Unaudited) -
Years Ended ended December 31, 2010 and 2009
11
Segment Net Sales and Operating Profit (Loss) (Unaudited) -
Quarters and Years Ended ended December 31, 2010 and 2009
12
Supplemental Schedules Major Factors Affecting
Net Sales and Operating Results (Unaudited) - Quarters and Years
Ended ended December 31, 2010 versus 2009 13 GAAP and
Managed Basis Consolidated Statements of Operations (Unaudited) -
Quarters ended December 31, 2010 and 2009 14 GAAP and
Managed Basis Consolidated Statements of Operations (Unaudited) -
Years Ended ended December 31, 2010 and 2009 15 GAAP and
Managed Basis Segment Net Sales and Operating Profit (Loss)
(Unaudited) - Quarters ended December 31, 2010 and 2009 16
GAAP and Managed Basis Segment Net Sales and Operating Profit
(Loss) (Unaudited) - Years Ended ended December 31, 2010 and 2009
17
CHEMTURA CORPORATION Consolidated Statements of
Operations (Unaudited) (In millions, except per share data)
Quarters Ended December 31,
Years Ended December 31,
2010 2009 2010 2009 Net sales $
680 $ 598 $ 2,760 $ 2,300 Cost of goods sold 516 432 2,103
1,721 Gross profit 164 166 657 579 Gross profit % 24% 28% 24% 25%
Selling, general and administrative 83 73 315 289
Depreciation and amortization 41 40 175 162 Research and
development 11 9 42 35 Facility closures, severance and related
costs - - 1 3 Antitrust costs - - - 10 Gain on sale of business - -
(2) - Impairment charges 57 2 57 39 Changes in estimates related to
expected allowable claims 2 73 35 73 Equity income (1) - (4) -
Operating (loss) profit (29) (31) 38 (32) Interest expense
(27) (17) (191) (70) Loss on early extinguishment of debt (75) -
(88) - Other expense, net (4) (6) (6) (17) Reorganization items,
net (223) (31) (303) (97)
Loss from continuing operations before
income taxes
(358) (85) (550) (216) Income tax provision (8) (9) (22) (10)
Loss from continuing operations (366) (94) (572) (226)
Earnings (loss) from discontinued operations, net of tax - 4 (1)
(63) Gain (loss) on sale of discontinued operations, net of tax - 1
(12) (3) Net loss (366) (89) (585) (292) Less: Net
earnings attributed to non-controlling interests (1) - (1) (1)
Net loss attributable to Chemtura $ (367) $ (89) $ (586) $
(293)
Basic and diluted per share information -
attributable to Chemtura Corporation: Loss from continuing
operations, net of tax $ (2.25) $ (0.38) $ (2.58) $ (0.93) Earnings
(loss) from discontinued operations, net of tax - 0.02 - (0.26)
Gain (loss) on sale of discontinued operations, net of tax - -
(0.05) (0.01) Net loss attributable to Chemtura $ (2.25) $ (0.36) $
(2.63) $ (1.20) Weighted average shares outstanding - Basic
and Diluted 163.7 242.9 223.0 242.9
Amounts attributable to Chemtura
Corporation stockholders:
Loss from continuing operations, net of tax $ (367) $ (94) $ (573)
$ (227) Earnings (loss) from discontinued operations, net of tax -
4 (1) (63) Gain (loss) on sale of discontinued operations, net of
tax - 1 (12) (3) Net loss attributable to Chemtura $ (367) $ (89) $
(586) $ (293)
CHEMTURA CORPORATION
Consolidated Balance Sheets (In millions)
December
31, December 31, 2010 2009 ASSETS
CURRENT ASSETS Cash and cash equivalents $ 201 $ 236
Restricted cash 32 - Accounts receivable 489 442 Inventories 528
489 Other current assets 171 227 Assets of discontinued operations
- 85 Total current assets 1,421 1,479 NON-CURRENT ASSETS
Property, plant and equipment, net 716 750 Goodwill 175 235
Intangible assets, net 429 474 Non-current restricted cash 6 -
Other assets 166 180 Total Assets $ 2,913 $ 3,118
LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT
LIABILITIES Short-term borrowings $ 3 $ 252 Accounts payable 191
126 Accrued expenses 281 178 Income taxes payable 14 5 Liabilities
of discontinued operations - 37 Total current liabilities 489 598
NON-CURRENT LIABILITIES Long-term debt 748 3 Pension and
post-retirement health care liabilities 498 151 Other liabilities
207 197 Total liabilities not subject to compromise 1,942 949
LIABILITIES SUBJECT TO COMPROMISE - 1,997
STOCKHOLDERS' EQUITY Common stock 1 3 Additional paid-in capital
4,305 3,039 Accumulated deficit (3,068) (2,482) Accumulated other
comprehensive loss (276) (234) Treasury stock at cost - (167) Total
Chemtura stockholders' equity 962 159 Non-controlling
interest 9 13 Total stockholders' equity 971 172 Total
Liabilities and Stockholders' Equity $ 2,913 $ 3,118
CHEMTURA
CORPORATION Condensed Consolidated Statements
of Cash Flows (Unaudited) (In millions)
Years Ended
December 31,
Increase (decrease)
to cash
2010 2009 CASH FLOWS FROM OPERATING ACTIVITIES
Net loss attributable to Chemtura $ (586) $ (293) Adjustments to
reconcile net loss attributable to Chemtura to net cash (used in)
provided by operating activities: Gain on sale of business (2) -
Loss on sale of discontinued operations 12 3 Impairment charges 60
104 Loss on early extinguishment of debt 88 - Depreciation and
amortization 175 173 Stock-based compensation expense 10 3
Reorganization items, net 186 35 Changes in estimates related to
expected allowable claims 35 73 Non-cash contractual post-petition
interest expense 113 - Equity income (4) - Changes in assets and
liabilities, net (291) (49) Net cash (used in) provided by
operating activities (204) 49
CASH FLOWS FROM INVESTING
ACTIVITIES Net proceeds from divestments 43 3 Payments for
acquisitions, net of cash acquired - (5) Capital expenditures (124)
(56) Net cash used in investing activities (81) (58)
CASH
FLOWS FROM FINANCING ACTIVITIES Proceeds from Senior Notes 452
- Proceeds from Term Loan 292 - Proceeds from Amended DIP Credit
Facility 299 - Payments on Amended DIP Credit Facility (300) -
(Payments on) proceeds from DIP Credit Facility, net (250) 250
Repayments of 6.875% Notes due 2016 (75) - Repayments of 6.875%
Debentures due 2026 (19) - Repayments of 7% Notes due 2009 (44) -
Payments on 2007 Credit Facility, net (54) (28) Proceeds from long
term borrowings - 1 Payments on long term borrowings - (18)
Payments on short term borrowings, net - (2) Payments for debt
issuance and refinancing costs (40) (30) Payments for make-whole
and no-call premiums (10) - Net cash provided by financing
activities 251 173
CASH Effect of exchange rates on
cash and cash equivalents (1) 4 Change in cash and cash
equivalents (35) 168 Cash and cash equivalents at beginning of
period 236 68 Cash and cash equivalents at end of period $
201 $ 236
CHEMTURA CORPORATION Segment Net Sales and
Operating Profit (Loss) (Unaudited) (In millions)
Quarters Ended December 31,
Years Ended December 31,
2010 2009 2010 2009 NET SALES
Consumer Products $ 89 $ 89 $ 458 $ 457 Industrial
Performance Products 303 279 1,223 999 Chemtura AgroSolutions™ 97
86 351 332 Industrial Engineered Products 191 144 728 512 Total net
sales $ 680 $ 598 $ 2,760 $ 2,300
OPERATING PROFIT
(LOSS) Consumer Products $ 9 $ 12 $ 67 $ 63 Industrial
Performance Products 29 36 119 91 Chemtura AgroSolutions™ 9 9 21 42
Industrial Engineered Products 13 7 25 3 Segment operating profit
60 64 232 199
General corporate expense, including
amortization
(29) (20) (102) (106) Change in useful life of property, plant and
equipment (1) - (1) - Facility closures, severance and related
costs - - (1) (3)
Antitrust costs
- - - (10) Gain on sale of business - - 2 - Impairment charges (57)
(2) (57) (39) Changes in estimates related to expected allowable
claims (2) (73) (35) (73) Total operating (loss) profit $ (29) $
(31) $ 38 $ (32)
CHEMTURA CORPORATION Major Factors
Affecting Net Sales and Operating Results (Unaudited)
Quarter and Year Ended December 31, 2010 versus 2009 (In
millions) The following table
summarizes the major factors contributing to the changes in
operating results versus the prior year:
Quarter Ended
December 31, Year Ended December 31, Pre-tax
Pre-tax Net Earnings Net
Earnings Sales (Loss) Sales
(Loss) 2009 $ 598 $ (85) $ 2,300 $ (216)
2009 Other operational adjustments
- - - 2
2009 Accelerated depreciation of property,
plant and equipment
- 1 - 5 2009 Facility closures, severance and related costs - - - 3
2009 Antitrust costs - - - 10 2009 Impairment charges - 2 - 39 2009
Changes in estimates related to expected allowable claims - 73 - 73
2009 Reorganization items, net - 31 - 97 598 22 2,300 13
Changes in selling prices 25 25 52 52 Unit volume and mix 65 18 422
86 Foreign currency impact - operating profit (loss) (2) (1) (6)
(4) Divestitures (6) (2) (8) (2) Manufacturing cost impacts - (2) -
61 Higher distribution costs - (1) - (18) Higher REACh costs - (2)
- (7) Higher raw materials and energy costs - (30) - (79) Changes
in SGA&R, excluding foreign exchange impact - (11) - (27) Lower
depreciation and amortization expense - 2 - 12 Higher equity income
- 1 - 4 (Higher) lower interest expense (excluding post-petition
interest on allowable claims) - (2) - 16
Foreign currency impact - other expense,
net
- - - 10 Lower interest income - (3) (5) Fees associated with sale
of accounts receivable - - - 2 Other - (3) - (7) 680 11 2,760 107
2009 Other operational adjustments
- - - (8) 2010 Accelerated depreciation of property, plant and
equipment - (4) - (30) 2010 Facility closures, severance and
related costs - - - (1) 2010 Gain on sale of business - - - 2 2010
Impairment charges - (57) (57) 2010 Changes in estimates to
expected allowable claims - (2) - (35) 2010 Loss on early
extinguishment of debt - (75) - (88) 2010 Post-petition interest
expense on allowable claims - (8) - (137) 2010 Reorganization
items, net - (223) - (303)
2010
$ 680 $ (358) $ 2,760 $ (550)
CHEMTURA CORPORATION GAAP
and Managed Basis Consolidated Statements of Operations
(Unaudited) (In millions, except per share data)
Quarter Ended December 31, 2010
Quarter Ended December 31, 2009 GAAP
Managed Basis
Adjustments
Managed Basis
GAAP
Managed Basis
Adjustments
Managed Basis Net sales $ 680 $ - $ 680 $ 598 $ - $
598 Cost of goods sold 516 - 516 432 - 432 Gross profit 164
- 164 166 - 166 Gross profit % 24% 24% 28% 28% Selling,
general and administrative 83 - 83 73 - 73 Depreciation and
amortization 41 (4) 37 40 (1) 39 Research and development 11 - 11 9
- 9 Impairment charges 57 (57) - 2 (2) - Changes in estimates
related to expected allowable claims 2 (2) - 73 (73) - Equity
income (1) - (1) - - - Operating (loss) profit (29) 63 34
(31) 76 45 Interest expense (27) 8 (19) (17) - (17) Loss on early
extinguishment of debt (75) 75 - - - - Other expense, net (4) - (4)
(6) - (6) Reorganization items, net (223) 223 - (31) 31 -
(Loss) earnings from continuing operations
before income taxes
(358) 369 11 (85) 107 22 Income tax provision (8) 5 (3) (9) 2 (7)
(Loss) earnings from continuing operations (366) 374 8 (94)
109 15 Earnings from discontinued operations, net of tax - - - 4
(4) - Gain on sale of discontinued operations, net of tax - - - 1
(1) - Net (loss) earnings
(366) 374 8 (89) 104 15 Less: Net earnings attributed to
non-controlling interest (1) - (1) - - -
Net (loss) earnings attributable to Chemtura $
(367) $ 374 $ 7 $ (89) $ 104 $ 15
Basic and diluted
per share information - attributable to Chemtura
Corporation: (Loss) earnings from continuing operations $
(2.25) $ 0.04 $ (0.38) $ 0.06 Earnings from discontinued operations
- - 0.02 - Gain on sale of discontinued operations - - - - Net
(loss) earnings attributable to Chemtura Corporation $ (2.25) $
0.04 $ (0.36) $ 0.06 Weighted average shares outstanding -
Basic and Diluted 163.7 163.7 242.9 242.9
Managed
Basis Adjustments consist of the following: Accelerated
depreciation of property, plant and equipment $ 4 $ 1 Impairment
charges 57 2 Changes in estimates related to expected allowable
claims 2 73 Post-petition interest expense on allowable claims 8 -
Loss on early extinguishment of debt 75 - Reorganization items, net
223 31 Pre-Tax 369 107 Adjustment to apply a Managed Basis
effective tax rate 5 2 After-tax 374 109 Earnings from discontinued
operations, net of tax - (4) Gain on sale of discontinued
operations, net of tax - (1) $ 374 $ 104
Adjusted EBITDA
consists of the following: Operating (loss) profit $
(29) $ 63 34 $ (31) $ 76 45 Plus: Depreciation and Amortization 41
(4) 37 40 (1) 39 Plus: Impairment charges 57 (57) - 2 (2) - Plus:
Changes in estimates related to expected allowable claims 2 (2) -
73 (73) -
Plus: Non-cash stock-based compensation
for post-confirmation awards
8 - 8 - - - Adjusted
EBITDA $ 79 $ - $ 79 $ 84 $ - $ 84
CHEMTURA CORPORATION
GAAP and Managed Basis Consolidated Statements of Operations
(Unaudited) (In millions, except per share data)
Year Ended December 31, 2010
Year Ended December 31, 2009
GAAP
Managed Basis
Adjustments
Managed Basis GAAP
Managed Basis
Adjustments
Managed Basis Net sales $ 2,760 $ - $ 2,760 $ 2,300 $
- $ 2,300 Cost of goods sold 2,103 (3) 2,100 1,721 (1) 1,720
Gross profit 657 3 660 579 1 580 Gross profit % 24% 24% 25% 25%
Selling, general and administrative 315 (5) 310 289 (1) 288
Depreciation and amortization 175 (30) 145 162 (5) 157 Research and
development 42 - 42 35 - 35 Facility closures, severance and
related costs 1 (1) - 3 (3) - Antitrust costs - - - 10 (10) - Gain
on sale of business (2) 2 - - - - Impairment charges 57 (57) - 39
(39) - Changes in estimates related to expected allowable claims 35
(35) - 73 (73) - Equity income (4) - (4) - - - Operating
profit (loss) 38 129 167 (32) 132 100 Interest expense (191) 137
(54) (70) - (70) Loss on early extinguishment of debt (88) 88 - - -
- Other expense, net (6) - (6) (17) - (17) Reorganization items,
net (303) 303 - (97) 97 -
(Loss) earnings from continuing operations
before income taxes
(550) 657 107 (216) 229 13 Income tax provision (22) (15) (37) (10)
6 (4) (Loss) earnings from continuing operations (572) 642
70 (226) 235 9 Loss from discontinued operations, net of tax (1) 1
- (63) 63 - Loss on sale of discontinued operations, net of tax
(12) 12 - (3) 3 - Net
(loss) earnings (585) 655 70 (292) 301 9 Less: Net earnings
attributed to non-controlling interest (1) - (1) (1) - (1)
Net (loss) earnings attributable
to Chemtura $ (586) $ 655 $ 69 $ (293) $ 301 $ 8
Basic
and diluted per share information - attributable to Chemtura
Corporation: (Loss) earnings from continuing operations $
(2.58) $ 0.31 $ (0.93) $ 0.03 Loss from discontinued operations - -
(0.26) - Loss on sale of discontinued operations (0.05) - (0.01) -
Net (loss) earnings attributable to Chemtura Corporation $ (2.63) $
0.31 $ (1.20) $ 0.03 Weighted average shares outstanding -
Basic and Diluted 223.0 223.0 242.9 242.9
Managed Basis
Adjustments consist of the following: Other operational
adjustments $ 8 $ 2 Accelerated depreciation of property, plant and
equipment 30 5 Facility closures, severance and related costs 1 3
Antitrust costs - 10 Gain on sale of business (2) - Impairment
charges 57 39 Changes in estimates related to expected allowable
claims 35 73 Post-petition interest expense on allowable claims 137
- Loss on early extinguishment of debt 88 - Reorganization items,
net 303 97 Pre-Tax 657 229 Adjustment to apply a Managed
Basis effective tax rate (15) 6 After-tax 642 235 Loss from
discontinued operations, net of tax 1 63 Loss on sale of
discontinued operations, net of tax 12 3 $ 655 $ 301
Adjusted EBITDA consists of the following: Operating
profit (loss) $ 38 $ 129 167 $ (32) $ 132 100 Plus: Other
operational adjustments 8 (8) - 2 (2) - Plus: Depreciation and
Amortization 175 (30) 145 162 (5) 157 Plus: Facility closures,
severance and related costs 1 (1) - 3 (3) - Plus: Antitrust costs -
- - 10 (10) - Plus: Gain on sale of business (2) 2 - - - - Plus:
Impairment charges 57 (57) - 39 (39) - Plus: Changes in estimates
related to expected allowable claims 35 (35) - 73 (73) -
Plus: Non-cash stock-based compensation
for post-confirmation awards
8 - 8 - - - Adjusted
EBITDA $ 320 $ - $ 320 $ 257 $ - $ 257
CHEMTURA CORPORATION
GAAP and Managed Basis Segment Sales and Operating Profit (Loss)
(Unaudited) (In millions of dollars)
Quarter Ended
December 31, 2010 Quarter Ended December 31, 2009
GAAP
Historical
Managed Basis
Adjustments
Managed Basis
GAAP
Historical
Managed Basis
Adjustments
Managed Basis NET SALES Consumer
Products $ 89 $ - $ 89 $ 89 $ - $ 89 Industrial Performance
Products 303 - 303 279 - 279 Chemtura AgroSolutions™ 97 - 97 86 -
86 Industrial Engineered Products 191 - 191 144 - 144 Total net
sales $ 680 $ - $ 680 $ 598 $ - $ 598
OPERATING
PROFIT Consumer Products $ 9 $ - $ 9 $ 12 $ 1 $ 13
Industrial Performance Products 29 - 29 36 - 36 Chemtura
AgroSolutions™ 9 - 9 9 - 9 Industrial Engineered Products 13 4 17 7
- 7 Segment operating profit 60 4 64 64 1 65
General corporate expense, including
amortization
(29) (1) (30) (20) - (20) Change in useful life of property, plant
and equipment (1) 1 - - - - Impairment charges (57) 57 - (2) 2 -
Changes in estimates related to expected allowable claims (2) 2 -
(73) 73 - Total operating (loss) profit $ (29) $ 63 $ 34 $ (31) $
76 $ 45
DEPRECIATION AND AMORTIZATION
Consumer Products $ 3 $ - $ 3 $ 4 $ (2) $ 2 Industrial Performance
Products 9 - 9 10 - 10 Chemtura AgroSolutions™ 3 - 3 2 - 2
Industrial Engineered Products 17 (4) 13 15 - 15
General corporate expense, including
amortization
9 - 9 9 1 10 Total depreciation and amortization $ 41 $ (4) $ 37 $
40 $ (1) $ 39
Managed Basis Adjustments
consist of the following: Accelerated depreciation of
property, plant and equipment $ 4 $ 1 Impairment charges 57 2
Changes in estimates related to expected allowable claims 2 73 $ 63
$ 76
NON-CASH STOCK-BASED COMPENSATION EXPENSE
Consumer Products $ - $ - $ - $ - $ - $ - Industrial
Performance Products 1 - 1 - - - Chemtura AgroSolutions™ - - - - -
- Industrial Engineered Products 1 - 1 - - -
General corporate expense, including
amortization
6 - 6 - - - Total stock-based compensation expense $ 8 $ - $ 8 $ -
$ - $ -
CHEMTURA CORPORATION
GAAP and Managed Basis Segment Sales and Operating
Profit (Loss) (Unaudited) (In millions of dollars)
Year
Ended December 31, 2010
Year Ended December 31, 2009
GAAP
Historical
Managed Basis
Adjustment
Managed Basis
GAAP
Historical
Managed Basis
Adjustment
Managed Basis NET SALES Consumer Products $
458 $ - $ 458 $ 457 $ - $ 457 Industrial Performance Products 1,223
- 1,223 999 - 999 Chemtura AgroSolutions™ 351 - 351 332 - 332
Industrial Engineered Products 728 - 728 512 - 512 Total net sales
$ 2,760 $ - $ 2,760 $ 2,300 $ - $ 2,300
OPERATING PROFIT
(LOSS) Consumer Products $ 67 $ 1 $ 68 $ 63 $ 3 $ 66
Industrial Performance Products 119 - 119 91 3 94 Chemtura
AgroSolutions™ 21 3 24 42 - 42 Industrial Engineered Products 25 29
54 3 - 3 Segment operating profit 232 33 265 199 6 205
General corporate expense, including
amortization
(102) 4 (98) (106) 1 (105) Change in useful life of property, plant
and equipment (1) 1 - - - - Facility closures, severance and
related cost (1) 1 - (3) 3 - Antitrust costs - - - (10) 10 - Gain
on sale of business 2 (2) - - - - Impairment charges (57) 57 - (39)
39 - Changes in estimates related to expected allowable claims (35)
35 - (73) 73 - Total operating profit (loss) $ 38 $ 129 $ 167 $
(32) $ 132 $ 100
DEPRECIATION AND AMORTIZATION
Consumer Products $ 11 $ (2) $ 9 $ 13 $ (3) $ 10 Industrial
Performance Products 35 - 35 41 (2) 39 Chemtura AgroSolutions™ 9 -
9 8 - 8 Industrial Engineered Products 79 (27) 52 57 - 57
General corporate expense, including
amortization
41 (1) 40 43 - 43 Total depreciation and amortization $ 175 $ (30)
$ 145 $ 162 $ (5) $ 157
Managed Basis Adjustments
consist of the following: Other operational adjustments
$ 8 $ 2 Accelerated depreciation of property, plant and equipment
30 5 Facility closures, severance and related costs 1 3 Antitrust
costs - 10 Gain on sale of business (2) - Impairment charges 57 39
Changes in estimates related to expected allowable claims 35 73 $
129 $ 132
NON-CASH STOCK-BASED COMPENSATION EXPENSE
Consumer Products $ - $ - $ - $ - $ - $ - Industrial
Performance Products 1 - 1 - - - Chemtura AgroSolutions™ - - - - -
- Industrial Engineered Products 1 - 1 - - -
General corporate expense, including
amortization
6 - 6 - - - Total stock-based compensation expense $ 8 $ - $ 8 $ -
$ - $ -
Chemtura Corp. (delisted) (NYSE:CHMT)
Historical Stock Chart
From Feb 2024 to Mar 2024
Chemtura Corp. (delisted) (NYSE:CHMT)
Historical Stock Chart
From Mar 2023 to Mar 2024