CLAYTON, Mo., May 2, 2017 /PRNewswire/ -- Olin Corporation
(NYSE: OLN) announced today financial results for the first quarter
ended March 31, 2017.
The first quarter 2017 reported net income was $13.4 million, or $0.08 per diluted share, which compares to a net
loss of $37.9 million, or
($0.23) per diluted share for the
first quarter 2016. First quarter 2017 adjusted EBITDA of
$220.4 million reflects depreciation
and amortization expense of $135.1
million, restructuring charges of $8.2 million, and acquisition-related integration
costs of $7.0 million. First
quarter 2016 adjusted EBITDA was $214.5
million. Sales in the first quarter 2017 were
$1,567.1 million compared to
$1,348.2 million in the first quarter
2016.
John E. Fischer, Chairman,
President and Chief Executive Officer, said, "Our overall first
quarter 2017 results were in line with our expectations. Our
first quarter 2017 adjusted EBITDA reflects better than expected
results in the Chlor Alkali Products and Vinyls segment, which more
than offset weaker than expected results in the Epoxy
segment. The favorable results in Chlor Alkali Products and
Vinyls were primarily the result of higher than anticipated caustic
soda and ethylene dichloride pricing. The shortfall in the
Epoxy segment earnings from expectations reflects higher than
expected raw material costs associated with benzene and propylene
pricing. First quarter 2017 Epoxy volumes improved
approximately 11% compared to last year's first quarter
levels. As expected, Winchester's first quarter 2017 segment
earnings declined year over year due to lower commercial sales
volumes partially offset by lower operating costs.
"For full year 2017, we are reiterating our annual adjusted
EBITDA forecast of approximately $1
billion with upside opportunities and downside risks of
approximately 5%.
"We expect second half 2017 adjusted EBITDA to be significantly
stronger than the first half 2017 levels. The Chlor Alkali
Products and Vinyls business is expected to benefit in second half
2017 from reduced maintenance turnaround activity, which reduced
first half volumes and increased maintenance expenses, seasonally
stronger second half demand, and improved caustic soda and chlorine
prices. We also expect improved performance from both Epoxy
and Winchester in the second half of 2017 compared to the first
half of the year. The second half 2017 Epoxy results are
expected to benefit from lower raw material costs than were
experienced in the first quarter. Second half 2017 Winchester
results include the seasonally strong third quarter and expected
higher military sales.
"Second quarter 2017 adjusted EBITDA is forecast to improve
slightly compared to first quarter 2017 levels. We anticipate
sequential improvement in both caustic soda and ethylene dichloride
pricing. The second quarter 2017 will also include the
benefits of the new bleach plant in Freeport, Texas, which began production in
March. Second quarter 2017 chlor alkali products volumes are
expected to be lower than first quarter 2017 due to planned
maintenance turnarounds at our largest production facility in
Freeport, Texas. These
planned maintenance turnarounds are forecast to reduce
adjusted EBITDA sequentially by approximately $25 million. We expect second quarter 2017
Epoxy segment earnings to improve sequentially as implemented and
announced price increases fully offset the current forecast for raw
material costs associated with benzene and propylene pricing.
We expect Winchester's second quarter 2017 segment earnings to be
less than second quarter 2016 earnings due to lower commercial
sales volumes."
The full year 2017 adjusted EBITDA forecast reflects the
following:
- Higher domestic and export caustic soda pricing compared to
2016;
- Lower ethylene costs associated with the acquisition of
additional cost-based ethylene from The Dow Chemical Company
beginning mid-year;
- Improved ethylene dichloride pricing of approximately 25%
year-over-year;
- Incremental cost synergy realizations of approximately
$50 million to $75 million;
- Improved Epoxy segment results driven by higher volumes
compared to the prior year;
- Higher electricity costs, primarily driven by higher natural
gas costs compared to 2016;
- Higher planned maintenance turnaround costs of $20 million to $30 million compared to 2016;
- Lower Winchester segment results due to lower commercial
ammunition demand and higher commodity and material costs;
- Higher corporate costs reflecting lower pension income and
higher legacy environmental costs compared to 2016;
- Pre-tax acquisition-related integration and restructuring costs
of approximately $50 million;
- Capital spending in the $300 million to
$350 million range, excluding the investment associated with
acquiring additional cost-based ethylene; and
- Depreciation and amortization costs comparable with 2016.
SEGMENT REPORTING
Olin defines segment earnings as income (loss) before interest
expense, interest income, other operating income (expense) and
income taxes and includes the earnings of non-consolidated
affiliates in segment results consistent with management's
monitoring of the operating segments.
CHLOR ALKALI PRODUCTS AND VINYLS
Chlor Alkali Products and Vinyls sales for the first quarter
2017 were $836.9 million compared to
$704.3 million in the first quarter
2016. The increase in the first quarter sales compared to the
prior year is primarily due to increased caustic soda and ethylene
dichloride prices and higher volumes. First quarter 2017
segment earnings of $87.5 million
improved compared to $68.1 million in
the first quarter 2016 primarily due to higher pricing, mainly
caustic soda and ethylene dichloride, and higher volumes, partially
offset by higher electricity costs driven by higher natural gas
costs, higher ethylene costs, and higher maintenance turnaround
costs. First quarter 2017 included planned maintenance
turnaround outages at the McIntosh,
Alabama and Plaquemine,
Louisiana facilities. Chlor Alkali Products and Vinyls
first quarter 2017 results included depreciation and amortization
expense of $104.6 million compared to
$101.9 million in first quarter
2016.
EPOXY
Epoxy sales for the first quarter 2017 were $567.6 million compared to $460.2 million in the first quarter 2016.
The increase in Epoxy sales is primarily due to increased volumes
and higher product prices. First quarter 2017 segment loss
was $1.2 million compared to segment
earnings of $8.2 million in the first
quarter 2016. The Epoxy segment earnings decline was
primarily due to higher raw material costs, primarily benzene and
propylene pricing, partially offset by higher product prices and
improved volumes. Epoxy first quarter 2017 results included
depreciation and amortization expense of $22.4 million compared to $21.7 million in first quarter 2016.
WINCHESTER
Winchester sales for the first quarter 2017 were $162.6 million compared to $183.7 million in the first quarter 2016.
First quarter 2017 segment earnings were $25.1 million compared to $28.7 million in the first quarter 2016.
The decrease in sales and segment earnings primarily reflects lower
shipments to commercial customers reflecting lower demand for
pistol, rifle, and shotshell ammunition. The segment earnings
reduction associated with the decline in commercial demand was
partially offset by lower operating costs in the first quarter of
2017 compared to first quarter 2016. Winchester first quarter
2017 results included depreciation and amortization expense of
$4.9 million compared to $4.6 million in first quarter 2016.
CORPORATE AND OTHER COSTS
Pension income included in the first quarter 2017 Corporate and
Other segment was $10.3 million
compared to $12.2 million in the
first quarter of 2016.
First quarter 2017 charges to income for environmental
investigatory and remedial activities were $2.6 million compared to $2.7 million in the first quarter 2016.
These charges relate primarily to remedial and investigatory
activities associated with former waste sites and past operations
of the legacy Olin businesses.
Other corporate and unallocated costs in the first quarter 2017
increased by $3.8 million compared to
the first quarter 2016, primarily due to $4.7 million of increased stock-based
compensation costs, which includes mark-to-market adjustments,
partially offset by lower legal and litigation costs.
DEBT REFINANCING
On March 9, 2017, Olin entered
into a new five-year $1,975 million
senior credit facility consisting of a $1,375 million term loan facility and a
$600 million senior revolving credit
facility. The proceeds of the term loan facility were used to
redeem the remaining balance of the existing senior credit facility
and a portion of the Sumitomo Credit Facility, which was due in
October 2018. The new senior credit facility will mature in
March 2022. Also on March 9,
2017, Olin issued $500.0
million aggregate principal amount of 5.125% senior notes
due September 15, 2027. The
proceeds of the 2027 Notes were used to redeem the remaining
balance of the Sumitomo Credit Facility. With this
refinancing, the Company has less than $150
million of mandatory term loan maturities annually until
2022.
DIVIDEND
On April 27, 2017, Olin's Board of
Directors declared a dividend of $0.20 on each share of Olin common stock.
The dividend is payable on June 9,
2017, to shareholders of record at the close of business on
May 10, 2017. This will be the
362nd consecutive quarterly dividend to be paid by the Company.
CONFERENCE CALL INFORMATION
Olin management will host a conference call to discuss first
quarter 2017 earnings at 10:00 A.M.
ET on Wednesday, May 3,
2017. The call, along with associated slides, which will be
available one hour prior to the call, will be accessible via
webcast through Olin's website, www.olin.com. An archived
replay of the webcast will also be available on Olin's Investor
Relations website beginning at 12:00 P.M.
ET. A final transcript of the call will be posted the
day following the event.
COMPANY DESCRIPTION
Olin Corporation is a leading vertically-integrated global
manufacturer and distributor of chemical products and a leading
U.S. manufacturer of ammunition. The chemical products
produced include chlorine and caustic soda, vinyls, epoxies,
chlorinated organics, bleach and hydrochloric acid.
Winchester's principal manufacturing facilities produce and
distribute sporting ammunition, law enforcement ammunition,
reloading components, small caliber military ammunition and
components, and industrial cartridges.
Visit www.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 October
2015 transaction to acquire the business (the Acquired
Business) from The Dow Chemical Company (TDCC), the expected
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, 2016,
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;
- higher-than-expected raw material and energy, transportation,
and/or logistics costs;
- our substantial amount of indebtedness and significant debt
service obligations;
- weak industry conditions could affect our ability to comply
with the financial maintenance covenants in our senior credit
facilities and certain tax-exempt bonds;
- our reliance on a limited number of suppliers for specified
feedstock and services and our reliance on third-party
transportation;
- failure to control costs or to achieve targeted cost
reductions;
- the occurrence of unexpected manufacturing interruptions and
outages, including those occurring as a result of labor disruptions
and production hazards;
- 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;
- 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;
- complications resulting from our multiple enterprise resource
planning (ERP) systems;
- the failure or an interruption of our information technology
systems;
- unexpected litigation outcomes;
- costs and other expenditures in excess of those projected for
environmental investigation and remediation or other legal
proceedings;
- the integration of the Acquired Business may not be successful
in realizing the benefits of the anticipated synergies;
- 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;
- fluctuations in foreign currency exchange rates;
- adverse conditions in the credit and capital markets, limiting
or preventing our ability to borrow or raise capital;
- failure to attract, retain and motivate key employees;
- our assumptions included in long range plans not realized
causing a non-cash impairment charge of long-lived assets;
- the effects of restrictions imposed on our business following
the transaction with TDCC in order to avoid significant tax-related
liabilities; and
- differences between the historical financial information of
Olin and the Acquired Business and our future operating
performance.
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.
2017-11
Olin
Corporation
|
|
Consolidated
Statements of Operations(a)
|
|
|
|
|
|
Three
Months
|
|
|
Ended March
31,
|
(In millions,
except per share amounts)
|
2017
|
2016
|
|
|
|
|
Sales
|
$1,567.1
|
$1,348.2
|
Operating
Expenses:
|
|
|
|
Cost of Goods
Sold
|
1,393.7
|
1,175.4
|
|
Selling and
Administration
|
88.2
|
88.1
|
|
Restructuring
Charges (b)
|
8.2
|
92.8
|
|
Acquisition-related Costs (c)
|
7.0
|
10.2
|
Other Operating
(Expense) Income (d)
|
(0.4)
|
10.9
|
|
Operating Income
(Loss)
|
69.6
|
(7.4)
|
Earnings of
Non-consolidated Affiliates
|
0.5
|
0.2
|
Interest Expense
(e)
|
52.4
|
48.5
|
Interest
Income
|
0.2
|
0.3
|
|
Income (Loss)
before Taxes
|
17.9
|
(55.4)
|
Income Tax
Provision (Benefit)
|
4.5
|
(17.5)
|
Net Income
(Loss)
|
$
13.4
|
$
(37.9)
|
Net Income (Loss)
Per Common Share:
|
|
|
|
Basic
|
$
0.08
|
$
(0.23)
|
|
Diluted
|
$
0.08
|
$
(0.23)
|
Dividends Per
Common Share
|
$
0.20
|
$
0.20
|
Average Common
Shares Outstanding - Basic
|
165.6
|
165.1
|
Average Common
Shares Outstanding - Diluted
|
167.9
|
165.1
|
|
|
|
|
(a)
|
Unaudited.
|
|
|
(b)
|
Restructuring
charges for the three months ended March 31, 2017 and 2016 were
primarily associated with the closure of 433,000 tons of chlor
alkali capacity across three separate Olin locations. For the
three months ended March 31, 2016, $76.6 million of these charges
were non-cash impairment charges for equipment and
facilities.
|
|
|
(c)
|
Acquisition-related costs for the three months
ended March 31, 2017 and 2016 were associated with our integration
of the Acquired Business.
|
|
|
(d)
|
Other operating
(expense) income for the three months ended March 31, 2016 included
an $11.0 million insurance recovery for property damage and
business interruption related to a 2008 chlor alkali facility
incident.
|
|
|
(e)
|
Interest expense
for the three months ended March 31, 2017 included $2.7 million for
the write-off of unamortized deferred debt issuance costs
associated with the redemption of the Sumitomo Credit Facility and
the refinancing of Olin's senior credit facility.
|
Olin
Corporation
|
|
Segment
Information(a)
|
|
|
|
Three
Months
|
|
|
Ended March
31,
|
(In
millions)
|
2017
|
|
2016
|
Sales:
|
|
|
|
|
Chlor Alkali
Products and Vinyls
|
$
836.9
|
|
$
704.3
|
|
Epoxy
|
567.6
|
|
460.2
|
|
Winchester
|
162.6
|
|
183.7
|
|
Total
Sales
|
$
1,567.1
|
|
$
1,348.2
|
Income (Loss)
before Taxes:
|
|
|
|
|
Chlor Alkali
Products and Vinyls
|
$
87.5
|
|
$
68.1
|
|
Epoxy
|
(1.2)
|
|
8.2
|
|
Winchester
|
25.1
|
|
28.7
|
|
Corporate/Other:
|
|
|
|
|
Pension Income
(b)
|
10.3
|
|
12.2
|
|
Environmental
Expense
|
(2.6)
|
|
(2.7)
|
|
Other Corporate and
Unallocated Costs
|
(33.4)
|
|
(29.6)
|
|
Restructuring Charges
(c)
|
(8.2)
|
|
(92.8)
|
|
Acquisition-related Costs
(d)
|
(7.0)
|
|
(10.2)
|
|
Other Operating
(Expense) Income (e)
|
(0.4)
|
|
10.9
|
|
Interest Expense
(f)
|
(52.4)
|
|
(48.5)
|
|
Interest
Income
|
0.2
|
|
0.3
|
|
Income (Loss)
before Taxes
|
$
17.9
|
|
$
(55.4)
|
|
|
|
|
|
(a)
|
Unaudited.
|
|
|
|
|
|
|
|
|
(b)
|
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.
|
|
|
(c)
|
Restructuring
charges for the three months ended March 31, 2017 and 2016 were
primarily associated with the closure of 433,000 tons of chlor
alkali capacity across three separate Olin locations. For the
three months ended March 31, 2016, $76.6 million of these charges
were non-cash impairment charges for equipment and
facilities.
|
|
|
(d)
|
Acquisition-related costs for the three months
ended March 31, 2017 and 2016 were associated with our integration
of the Acquired Business.
|
|
|
(e)
|
Other operating
(expense) income for the three months ended March 31, 2016 included
an $11.0 million insurance recovery for property damage and
business interruption related to a 2008 chlor alkali facility
incident.
|
|
|
(f)
|
Interest expense
for the three months ended March 31, 2017 included $2.7 million for
the write-off of unamortized deferred debt issuance costs
associated with the redemption of the Sumitomo Credit Facility and
the refinancing of Olin's senior credit facility.
|
Olin
Corporation
|
|
|
|
Consolidated
Balance Sheets (a)
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
March
31,
|
(In millions,
except per share data)
|
2017
|
|
2016
|
|
2016
|
|
|
|
|
|
|
Assets:
|
|
|
|
|
|
Cash &
Cash Equivalents
|
$
168.5
|
|
$
184.5
|
|
$
315.6
|
Accounts
Receivable, Net
|
774.5
|
|
675.0
|
|
813.2
|
Income
Taxes Receivable
|
25.5
|
|
25.5
|
|
36.3
|
Inventories
|
656.3
|
|
630.4
|
|
679.5
|
Other
Current Assets
|
44.9
|
|
30.8
|
|
32.8
|
Total Current Assets
|
1,669.7
|
|
1,546.2
|
|
1,877.4
|
Property,
Plant and Equipment
|
|
|
|
|
|
(Less Accumulated
Depreciation of $2,001.1, $1,891.6 and $1,587.9)
|
3,659.2
|
|
3,704.9
|
|
3,859.0
|
Deferred
Income Taxes
|
112.7
|
|
119.5
|
|
107.4
|
Other
Assets
|
637.2
|
|
644.4
|
|
463.8
|
Intangibles, Net
|
615.4
|
|
629.6
|
|
663.2
|
Goodwill
|
2,119.0
|
|
2,118.0
|
|
2,146.1
|
Total
Assets
|
$
8,813.2
|
|
$
8,762.6
|
|
$
9,116.9
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity:
|
|
|
|
|
|
Current
Installments of Long-term Debt
|
$
81.8
|
|
$
80.5
|
|
$
205.1
|
Accounts
Payable
|
637.3
|
|
570.8
|
|
478.1
|
Income
Taxes Payable
|
8.1
|
|
7.5
|
|
14.1
|
Accrued
Liabilities
|
258.2
|
|
263.8
|
|
352.3
|
Total Current Liabilities
|
985.4
|
|
922.6
|
|
1,049.6
|
Long-term
Debt
|
3,530.8
|
|
3,537.1
|
|
3,627.9
|
Accrued
Pension Liability
|
627.5
|
|
638.1
|
|
635.2
|
Deferred
Income Taxes
|
1,033.0
|
|
1,032.5
|
|
1,091.0
|
Other
Liabilities
|
364.9
|
|
359.3
|
|
340.4
|
Total
Liabilities
|
6,541.6
|
|
6,489.6
|
|
6,744.1
|
Commitments and
Contingencies
|
|
|
|
|
|
Shareholders'
Equity:
|
|
|
|
|
|
Common Stock, Par
Value $1 Per Share, Authorized 240.0 Shares:
|
|
|
|
|
|
Issued and Outstanding 165.9 Shares (165.4 and 165.2 in
2016)
|
165.9
|
|
165.4
|
|
165.2
|
Additional Paid-in
Capital
|
2,253.7
|
|
2,243.8
|
|
2,238.9
|
Accumulated Other
Comprehensive Loss
|
(502.1)
|
|
(510.0)
|
|
(470.2)
|
Retained
Earnings
|
354.1
|
|
373.8
|
|
438.9
|
Total
Shareholders' Equity
|
2,271.6
|
|
2,273.0
|
|
2,372.8
|
Total Liabilities
and Shareholders' Equity
|
$
8,813.2
|
|
$
8,762.6
|
|
$
9,116.9
|
|
|
|
|
|
|
(a)
Unaudited.
|
|
|
|
|
|
Olin
Corporation
|
|
|
|
|
Consolidated
Statements of Cash Flows(a)
|
|
|
|
|
|
|
|
|
Three
Months
|
|
Ended March
31,
|
(In
millions)
|
2017
|
|
2016
|
Operating
Activities:
|
|
|
|
Net Income
(Loss)
|
$
13.4
|
|
$
(37.9)
|
Earnings of
Non-consolidated Affiliates
|
(0.5)
|
|
(0.2)
|
Losses on
Disposition of Property, Plant and Equipment
|
0.3
|
|
0.2
|
Stock-Based
Compensation
|
1.5
|
|
2.2
|
Depreciation and
Amortization
|
135.1
|
|
129.7
|
Deferred Income
Taxes
|
9.5
|
|
(14.7)
|
Write-off of
Equipment and Facility Included in Restructuring
Charges
|
-
|
|
76.6
|
Qualified Pension
Plan Contributions
|
(0.1)
|
|
(0.5)
|
Qualified Pension
Plan Income
|
(6.7)
|
|
(9.0)
|
Changes
in:
|
|
|
|
Receivables
|
(80.2)
|
|
(16.8)
|
Income Taxes
Receivable/Payable
|
0.1
|
|
5.6
|
Inventories
|
(23.8)
|
|
6.3
|
Other Current
Assets
|
(17.5)
|
|
6.5
|
Accounts
Payable and Accrued Liabilities
|
56.3
|
|
(99.7)
|
Other
Assets
|
3.1
|
|
2.1
|
Other
Noncurrent Liabilities
|
4.6
|
|
(0.3)
|
Other Operating
Activities
|
4.8
|
|
(3.1)
|
Net Operating
Activities
|
99.9
|
|
47.0
|
Investing
Activities:
|
|
|
|
Capital
Expenditures
|
(83.0)
|
|
(76.1)
|
Proceeds from
Disposition of Property, Plant and Equipment
|
-
|
|
0.1
|
Proceeds from
Disposition of Affiliated Companies
|
-
|
|
2.2
|
Net Investing
Activities
|
(83.0)
|
|
(73.8)
|
Financing
Activities:
|
|
|
|
Long-term
Debt:
|
|
|
|
Borrowings
|
1,875.0
|
|
-
|
Repayments
|
(1,872.7)
|
|
(17.1)
|
Stock Options
Exercised
|
8.8
|
|
-
|
Dividends
Paid
|
(33.1)
|
|
(33.0)
|
Debt Issuance
Costs
|
(11.2)
|
|
-
|
Net Financing
Activities
|
(33.2)
|
|
(50.1)
|
Net Decrease in
Cash and Cash Equivalents
|
(16.3)
|
|
(76.9)
|
Effect of Exchange
Rate Changes on Cash and Cash Equivalents
|
0.3
|
|
0.5
|
Cash and Cash
Equivalents, Beginning of Period
|
184.5
|
|
392.0
|
Cash and Cash
Equivalents, End of Period
|
$
168.5
|
|
$
315.6
|
|
|
|
|
(a)
Unaudited.
|
|
|
|
Olin
Corporation
Non-GAAP Financial
Measures (a)
|
|
Olin's definition
of Adjusted EBITDA (Earnings before interest, taxes, depreciation,
and amortization) is net income (loss) plus an add-back for
depreciation and amortization, interest expense (income), income
tax expense (benefit), other expense (income), restructuring
charges, acquisition-related costs and certain other non-recurring
items. 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. Reconciliation of
forward-looking non-GAAP financial measures to the most directly
comparable GAAP financial measures are omitted from this release
because Olin is unable to provide such reconciliations without the
use of unreasonable efforts. This inability results from the
inherent difficulty in forecasting generally and quantifying
certain projected amounts that are necessary for such
reconciliations. In particular, sufficient information is not
available to calculate certain adjustments required for such
reconciliations, including interest expense (income), income tax
expense (benefit), other expense (income), restructuring charges
and acquisition-related costs. Because of our inability to
calculate such adjustments, forward-looking net income guidance is
also omitted from this release. We expect these adjustments
to have a potentially significant impact on our future GAAP
financial results.
|
|
|
|
|
Three
Months
|
|
|
Ended March
31,
|
(In
millions)
|
2017
|
2016
|
|
|
|
|
Reconciliation of
Net Income (Loss) to Adjusted EBITDA:
|
|
|
Net Income
(Loss)
|
$
13.4
|
$
(37.9)
|
|
Add
Back:
|
|
|
|
Interest
Expense
|
52.4
|
48.5
|
|
Interest
Income
|
(0.2)
|
(0.3)
|
|
Income Tax
Provision (Benefit)
|
4.5
|
(17.5)
|
|
Depreciation and
Amortization
|
135.1
|
129.7
|
EBITDA
|
205.2
|
122.5
|
|
Add
Back:
|
|
|
|
Restructuring
Charges (b)
|
8.2
|
92.8
|
|
Acquisition-related Costs (c)
|
7.0
|
10.2
|
|
Certain
Non-recurring Items (d)
|
-
|
(11.0)
|
Adjusted
EBITDA
|
$
220.4
|
$
214.5
|
(a)
|
Unaudited.
|
|
|
(b)
|
Restructuring
charges for the three months ended March 31, 2017 and 2016 were
primarily associated with the closure of 433,000 tons of chlor
alkali capacity across three separate Olin locations. For the
three months ended March 31, 2016, $76.6 million of these charges
were non-cash impairment charges for equipment and
facilities.
|
|
|
(c)
|
Acquisition-related costs for the three months
ended March 31, 2017 and 2016 were associated with our integration
of the Acquired Business.
|
|
|
(d)
|
Certain
non-recurring items for the three months ended March 31, 2016
included an $11.0 million insurance recovery for property damage
and business interruption related to a 2008 Henderson, NV chlor
alkali facility incident.
|
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/olin-announces-first-quarter-2017-earnings-300450137.html
SOURCE Olin Corporation