CLAYTON, Mo., June 19, 2017 /PRNewswire/ -- Olin Corporation
(NYSE: OLN) announced today an updated outlook for the second
quarter 2017.
Olin's second quarter 2017 adjusted EBITDA will be reduced by
approximately $45 million due to the
combined impact from an extended vinyl chloride monomer (VCM) plant
turnaround and an unplanned Bisphenol A plant outage. For
full year 2017, Olin is reiterating the annual adjusted EBITDA
forecast of $1 billion with upside
opportunities and downside risks of approximately 5%.
During the second quarter, the planned VCM plant 40-day
maintenance turnaround at the Freeport,
Texas facility required an extension of approximately four
weeks. This maintenance turnaround is performed once every
three years. In addition, the Bisphenol A plant at the
Freeport epoxy facility
experienced an unplanned outage. This epoxy outage lasted
approximately three weeks. Both the VCM plant and the
Bisphenol A plant have returned to normal
operations.
Olin expects second half 2017 adjusted EBITDA to be
significantly higher than the first half 2017 levels. The
second half 2017 adjusted EBITDA is forecast to benefit from
reduced maintenance turnaround activity compared to the first half
levels. This benefit is expected to be approximately
$90 million to $100 million.
The Chlor Alkali Products and Vinyls business is forecast to
benefit in second half 2017 from seasonally stronger demand,
improved caustic soda and chlorine prices and lower ethylene
costs. The second half 2017 Epoxy results are expected to
benefit from lower raw material costs than were experienced in the
first half 2017. In the second half 2017, Winchester will
benefit from the seasonally strong third quarter commercial
ammunition demand and an expected improvement in military
sales.
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.
2017-12
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SOURCE Olin Corporation