CLAYTON, Mo., July 31, 2017 /PRNewswire/ -- Olin Corporation
(NYSE: OLN) announced financial results for the second quarter
ended June 30, 2017.
The second quarter 2017 reported net loss was $5.9 million, or ($0.04) per diluted share, which compares to a
net loss of $1.0 million, or
($0.01) per diluted share for the
second quarter 2016. Second quarter 2017 adjusted EBITDA of
$180.3 million reflects depreciation
and amortization expense of $137.1
million, restructuring charges of $8.5 million, and acquisition-related integration
costs of $4.4 million. Second
quarter 2016 adjusted EBITDA was $180.4
million. Sales in the second quarter 2017 were
$1,526.5 million compared to
$1,364.0 million in the second
quarter 2016.
John E. Fischer, Chairman,
President and Chief Executive Officer, said, "We expect 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 $110 million. The
Chlor Alkali Products and Vinyls business is forecast to benefit in
second half 2017 from stronger demand across all products, improved
caustic soda and chlorine prices and lower ethylene costs.
The second half 2017 Epoxy results are expected to benefit from
more favorable pricing and lower raw material costs than were
experienced in the first half 2017. In second half 2017, we
expect Winchester will benefit from the seasonally strong third
quarter commercial ammunition demand and an expected improvement in
military sales.
"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%.
"During the second quarter, the planned 40-day vinyl chloride
monomer plant 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, Texas
epoxy facility experienced an unplanned outage. This epoxy
outage lasted approximately three weeks. The second quarter
also included a four-week planned maintenance turnaround of the
Freeport, Texas chlor alkali
assets, which is performed once every five years. In total
during the second quarter, the Chlor Alkali Products and Vinyls
segment earnings included approximately $56
million of maintenance costs for turnarounds and outages,
and approximately $39 million of
unabsorbed fixed manufacturing costs and reduced profit from lost
sales associated with the turnarounds and outages. These
costs were approximately $36 million
higher than anticipated due to the extended outage. Second
quarter 2017 Epoxy segment earnings included approximately
$5 million of maintenance costs, and
approximately $9 million of
unabsorbed fixed manufacturing costs and reduced profit from lost
sales, associated with the unplanned outage of the Bisphenol A
plant.
"Chlor Alkali Products and Vinyls experienced sequential
improvement in second quarter caustic soda pricing of approximately
8% and ethylene dichloride pricing of approximately 5%. Third
quarter 2017 caustic soda and chlorine prices are forecast to
improve sequentially and ethylene dichloride pricing is forecast to
decline sequentially from the second quarter to the third
quarter. We continue to expect that the positive pricing
trends in caustic soda will continue into 2018 reflecting continued
improved caustic soda industry fundamentals.
"Winchester second quarter 2017 segment earnings of $19.0 million were below our expectation due to a
less favorable sales product mix and lower commercial sales
volumes. Second quarter 2017 Winchester commercial sales
declined approximately 15% compared to second quarter 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 second quarter
2017 were $865.1 million compared to
$733.0 million in the second quarter
2016. The increase in the second quarter sales compared to
the prior year was primarily due to increased caustic soda and
ethylene dichloride prices. Second quarter 2017 segment
earnings of $52.8 million improved
compared to $30.7 million in the
second quarter 2016, primarily due to higher pricing of caustic
soda and ethylene dichloride and lower operating costs, partially
offset by approximately $75 million
of additional maintenance costs, unabsorbed fixed manufacturing
costs, and reduced profit from lost sales associated with the
turnarounds and outages. Electricity costs, driven by higher
natural gas prices, and ethylene costs were also higher
year-over-year. Chlor Alkali Products and Vinyls second
quarter 2017 results included depreciation and amortization expense
of $106.6 million compared to
$103.4 million in the second quarter
2016.
EPOXY
Epoxy sales for the second quarter 2017 were $492.0 million compared to $450.0 million in the second quarter 2016.
The increase in Epoxy sales was primarily due to higher product
prices and increased volumes. The second quarter 2017 segment
loss was $8.1 million compared to
breakeven in the second quarter 2016. The Epoxy segment
earnings decline was principally due to higher raw material costs,
primarily benzene and propylene, partially offset by higher product
prices and improved volumes. Epoxy second quarter 2017
results included depreciation and amortization expense of
$22.8 million compared to
$23.0 million in the second quarter
2016.
WINCHESTER
Winchester sales for the second quarter 2017 were $169.4 million compared to $181.0 million in the second quarter 2016.
Second quarter 2017 segment earnings were $19.0 million compared to $31.2 million in the second quarter 2016.
The decrease in sales and segment earnings was primarily due to
lower shipments to commercial customers reflecting lower demand for
pistol, rifle, and shotshell ammunition, partially offset by higher
military sales. The segment earnings reduction was also
associated with a less favorable product mix and higher commodity
and other material costs in the second quarter 2017 compared to
second quarter 2016. Winchester second quarter 2017 and 2016
results both included depreciation and amortization expense of
$4.5 million.
CORPORATE AND OTHER COSTS
Pension income included in the second quarter 2017 Corporate and
Other segment was $10.7 million
compared to $12.6 million in the
second quarter 2016.
Second quarter 2017 charges to income for environmental
investigatory and remedial activities were $1.8 million compared to $2.4 million in the second 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 second quarter 2017
increased by $5.8 million compared to
the second quarter 2016, primarily due to increased consulting
costs, higher legal and litigation costs, and an unfavorable
currency impact.
DIVIDEND
On July 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 September 11,
2017, to shareholders of record at the close of business on
August 10, 2017. This will be
the 363rd consecutive quarterly dividend to be paid by
the Company.
CONFERENCE CALL INFORMATION
Olin management will host a conference call to discuss second
quarter 2017 earnings at 10:00 A.M.
ET on Tuesday, August 1,
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.
2017-16
Olin
Corporation
|
|
|
|
|
|
Consolidated
Statements of Operations(a)
|
|
|
|
|
|
|
|
Three
Months
|
|
Six
Months
|
|
|
Ended June
30,
|
|
Ended June
30,
|
(In millions,
except per share amounts)
|
2017
|
2016
|
|
2017
|
2016
|
|
|
|
|
|
|
|
Sales
|
$1,526.5
|
$1,364.0
|
|
$3,093.6
|
$2,712.2
|
Operating
Expenses:
|
|
|
|
|
|
Cost of Goods
Sold
|
1,404.1
|
1,236.9
|
|
2,797.8
|
2,412.3
|
Selling and
Administration
|
80.0
|
79.3
|
|
168.2
|
167.4
|
Restructuring
Charges (b)
|
8.5
|
8.2
|
|
16.7
|
101.0
|
Acquisition-related
Costs (c)
|
4.4
|
16.3
|
|
11.4
|
26.5
|
Other Operating
Income (Expense) (d)
|
0.3
|
(0.2)
|
|
(0.1)
|
10.7
|
Operating
Income
|
29.8
|
23.1
|
|
99.4
|
15.7
|
Earnings of
Non-consolidated Affiliates
|
0.5
|
0.4
|
|
1.0
|
0.6
|
Interest
Expense
|
52.5
|
47.6
|
|
104.9
|
96.1
|
Interest
Income
|
0.4
|
0.5
|
|
0.6
|
0.8
|
Loss before
Taxes
|
(21.8)
|
(23.6)
|
|
(3.9)
|
(79.0)
|
Income Tax
Benefit
|
(15.9)
|
(22.6)
|
|
(11.4)
|
(40.1)
|
Net (Loss)
Income
|
$
(5.9)
|
$
(1.0)
|
|
$
7.5
|
$
(38.9)
|
Net (Loss) Income
Per Common Share:
|
|
|
|
|
|
Basic
|
$
(0.04)
|
$
(0.01)
|
|
$
0.05
|
$
(0.24)
|
Diluted
|
$
(0.04)
|
$
(0.01)
|
|
$
0.04
|
$
(0.24)
|
Dividends Per
Common Share
|
$
0.20
|
$
0.20
|
|
$
0.40
|
$
0.40
|
Average Common
Shares Outstanding - Basic
|
|
166.1
|
165.2
|
|
165.8
|
165.1
|
Average Common
Shares Outstanding - Diluted
|
166.1
|
165.2
|
|
168.0
|
165.1
|
(a)
|
Unaudited.
|
(b)
|
Restructuring
charges for the three and six months ended June 30, 2017 and 2016
were primarily associated with the closure of 433,000 tons of chlor
alkali capacity across three separate Olin locations. For the
six months ended June 30, 2016, $76.6 million of these charges were
non-cash impairment charges for equipment and
facilities.
|
(c)
|
Acquisition-related costs for the three and six
months ended June 30, 2017 and 2016 were associated with our
integration of the Acquired Business.
|
(d)
|
Other operating
income (expense) for the six months ended June 30, 2016 included an
$11.0 million insurance recovery for property damage and business
interruption related to a 2008 chlor alkali facility
incident.
|
Olin
Corporation
|
|
|
|
|
|
|
|
Segment
Information(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months
|
|
Six
Months
|
|
|
Ended June
30,
|
|
Ended June
30,
|
(In
millions)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Sales:
|
|
|
|
|
|
|
|
|
Chlor Alkali
Products and Vinyls
|
$
865.1
|
|
$
733.0
|
|
$
1,702.0
|
|
$
1,437.3
|
|
Epoxy
|
492.0
|
|
450.0
|
|
1,059.6
|
|
910.2
|
|
Winchester
|
169.4
|
|
181.0
|
|
332.0
|
|
364.7
|
|
Total Sales
|
$
1,526.5
|
|
$
1,364.0
|
|
$
3,093.6
|
|
$
2,712.2
|
Income (Loss)
before Taxes:
|
|
|
|
|
|
|
|
|
Chlor Alkali
Products and Vinyls
|
$
52.8
|
|
$
30.7
|
|
$
140.3
|
|
$
98.8
|
|
Epoxy
|
(8.1)
|
|
-
|
|
(9.3)
|
|
8.2
|
|
Winchester
|
19.0
|
|
31.2
|
|
44.1
|
|
59.9
|
|
Corporate/Other:
|
|
|
|
|
|
|
|
|
Pension Income
(b)
|
10.7
|
|
12.6
|
|
21.0
|
|
24.8
|
|
Environmental
Expense
|
(1.8)
|
|
(2.4)
|
|
(4.4)
|
|
(5.1)
|
|
Other Corporate and
Unallocated Costs
|
(29.7)
|
|
(23.9)
|
|
(63.1)
|
|
(53.5)
|
|
Restructuring Charges
(c)
|
(8.5)
|
|
(8.2)
|
|
(16.7)
|
|
(101.0)
|
|
Acquisition-related Costs
(d)
|
(4.4)
|
|
(16.3)
|
|
(11.4)
|
|
(26.5)
|
|
Other Operating
Income (Expense) (e)
|
0.3
|
|
(0.2)
|
|
(0.1)
|
|
10.7
|
|
Interest
Expense
|
(52.5)
|
|
(47.6)
|
|
(104.9)
|
|
(96.1)
|
|
Interest
Income
|
0.4
|
|
0.5
|
|
0.6
|
|
0.8
|
|
Loss before
Taxes
|
$
(21.8)
|
|
$
(23.6)
|
|
$
(3.9)
|
|
$
(79.0)
|
(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 and six months ended June 30, 2017 and 2016
were primarily associated with the closure of 433,000 tons of chlor
alkali capacity across three separate Olin locations. For the
six months ended June 30, 2016, $76.6 million of these charges were
non-cash impairment charges for equipment and
facilities.
|
(d)
|
Acquisition-related costs for the three and six
months ended June 30, 2017 and 2016 were associated with our
integration of the Acquired Business.
|
(e)
|
Other operating
income (expense) for the six months ended June 30, 2016 included an
$11.0 million insurance recovery for property damage and business
interruption related to a 2008 chlor alkali facility
incident.
|
Olin
Corporation
|
|
|
|
|
|
Consolidated
Balance Sheets (a)
|
|
|
|
|
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
June
30,
|
(In millions,
except per share data)
|
2017
|
|
2016
|
|
2016
|
Assets:
|
|
|
|
|
|
Cash &
Cash Equivalents
|
$
184.5
|
|
$
184.5
|
|
$
66.6
|
Accounts
Receivable, Net
|
782.2
|
|
675.0
|
|
790.5
|
Income
Taxes Receivable
|
20.9
|
|
25.5
|
|
45.8
|
Inventories
|
666.2
|
|
630.4
|
|
636.2
|
Other
Current Assets
|
37.2
|
|
30.8
|
|
23.8
|
Total Current Assets
|
1,691.0
|
|
1,546.2
|
|
1,562.9
|
Property,
Plant and Equipment
|
|
|
|
|
|
(Less Accumulated
Depreciation of $2,117.6, $1,891.6 and $1,681.2)
|
3,627.4
|
|
3,704.9
|
|
3,793.3
|
Deferred
Income Taxes
|
125.2
|
|
119.5
|
|
107.0
|
Other
Assets
|
625.6
|
|
644.4
|
|
588.6
|
Intangibles, Net
|
605.6
|
|
629.6
|
|
671.2
|
Goodwill
|
2,119.5
|
|
2,118.0
|
|
2,186.3
|
Total
Assets
|
$
8,794.3
|
|
$
8,762.6
|
|
$
8,909.3
|
|
|
|
|
|
|
Liabilities and
Shareholders' Equity:
|
|
|
|
|
|
Current
Installments of Long-term Debt
|
$
81.7
|
|
$
80.5
|
|
$
80.3
|
Accounts
Payable
|
656.1
|
|
570.8
|
|
536.4
|
Income
Taxes Payable
|
7.1
|
|
7.5
|
|
8.2
|
Accrued
Liabilities
|
261.5
|
|
263.8
|
|
293.6
|
Total Current Liabilities
|
1,006.4
|
|
922.6
|
|
918.5
|
Long-term
Debt
|
3,518.9
|
|
3,537.1
|
|
3,615.5
|
Accrued
Pension Liability
|
625.6
|
|
638.1
|
|
616.7
|
Deferred
Income Taxes
|
1,037.6
|
|
1,032.5
|
|
1,079.3
|
Other
Liabilities
|
347.2
|
|
359.3
|
|
348.3
|
Total Liabilities
|
6,535.7
|
|
6,489.6
|
|
6,578.3
|
Commitments and
Contingencies
|
|
|
|
|
|
Shareholders'
Equity:
|
|
|
|
|
|
Common Stock, Par
Value $1 Per Share, Authorized 240.0 Shares:
|
|
|
|
|
|
Issued and Outstanding 166.3 Shares (165.4 and 165.2 in
2016)
|
166.3
|
|
165.4
|
|
165.2
|
Additional Paid-in
Capital
|
2,262.7
|
|
2,243.8
|
|
2,240.3
|
Accumulated Other
Comprehensive Loss
|
(485.4)
|
|
(510.0)
|
|
(479.3)
|
Retained
Earnings
|
315.0
|
|
373.8
|
|
404.8
|
Total Shareholders'
Equity
|
2,258.6
|
|
2,273.0
|
|
2,331.0
|
Total Liabilities
and Shareholders' Equity
|
$
8,794.3
|
|
$
8,762.6
|
|
$
8,909.3
|
|
|
|
|
|
|
(a)
Unaudited.
|
|
|
|
|
|
Olin
Corporation
|
|
|
|
Consolidated
Statements of Cash Flows(a)
|
|
|
|
|
Six
Months
|
|
Ended June
30,
|
(In
millions)
|
2017
|
|
2016
|
Operating
Activities:
|
|
|
|
Net Income
(Loss)
|
$
7.5
|
|
$
(38.9)
|
Earnings of
Non-consolidated Affiliates
|
(1.0)
|
|
(0.6)
|
Losses on
Disposition of Property, Plant and Equipment
|
0.3
|
|
0.5
|
Stock-based
Compensation
|
4.0
|
|
3.7
|
Depreciation and
Amortization
|
272.2
|
|
262.1
|
Deferred Income
Taxes
|
(11.6)
|
|
(33.2)
|
Write-off of
Equipment and Facility Included in Restructuring
Charges
|
-
|
|
76.6
|
Qualified Pension
Plan Contributions
|
(0.9)
|
|
(0.7)
|
Qualified Pension
Plan Income
|
(13.7)
|
|
(18.7)
|
Changes
in:
|
|
|
|
Receivables
|
(97.9)
|
|
(37.4)
|
Income Taxes
Receivable/Payable
|
3.3
|
|
(9.6)
|
Inventories
|
(26.3)
|
|
25.8
|
Other Current
Assets
|
(10.3)
|
|
15.0
|
Accounts
Payable and Accrued Liabilities
|
99.6
|
|
(57.0)
|
Other
Assets
|
5.8
|
|
(1.1)
|
Other
Noncurrent Liabilities
|
(9.2)
|
|
1.6
|
Other Operating
Activities
|
5.6
|
|
(1.9)
|
Net Operating
Activities
|
227.4
|
|
186.2
|
Investing
Activities:
|
|
|
|
Capital
Expenditures
|
(150.9)
|
|
(137.4)
|
Business Acquired
in Purchase Transaction, Net of Cash Acquired
|
-
|
|
(69.5)
|
Payments Under
Long-term Supply Contract
|
-
|
|
(85.0)
|
Proceeds from
Disposition of Property, Plant and Equipment
|
0.1
|
|
0.4
|
Proceeds from
Disposition of Affiliated Companies
|
-
|
|
4.4
|
Net Investing
Activities
|
(150.8)
|
|
(287.1)
|
Financing
Activities:
|
|
|
|
Long-term
Debt:
|
|
|
|
Borrowings
|
1,875.0
|
|
-
|
Repayments
|
(1,890.1)
|
|
(159.0)
|
Stock Options
Exercised
|
15.8
|
|
0.2
|
Dividends
Paid
|
(66.3)
|
|
(66.1)
|
Debt Issuance
Costs
|
(11.2)
|
|
-
|
Net Financing
Activities
|
(76.8)
|
|
(224.9)
|
Net Decrease in
Cash and Cash Equivalents
|
(0.2)
|
|
(325.8)
|
Effect of Exchange
Rate Changes on Cash and Cash Equivalents
|
0.2
|
|
0.4
|
Cash and Cash
Equivalents, Beginning of Period
|
184.5
|
|
392.0
|
Cash and Cash
Equivalents, End of Period
|
$
184.5
|
|
$
66.6
|
|
|
|
|
(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
|
|
Six
Months
|
|
|
|
Ended June
30,
|
|
Ended June
30,
|
|
(In
millions)
|
2017
|
2016
|
|
2017
|
2016
|
|
Reconciliation of
Net (Loss) Income to Adjusted EBITDA:
|
|
|
|
|
|
|
Net (Loss)
Income
|
$
(5.9)
|
$
(1.0)
|
|
$
7.5
|
$
(38.9)
|
|
|
Add
Back:
|
|
|
|
|
|
|
|
Interest
Expense
|
52.5
|
47.6
|
|
104.9
|
96.1
|
|
|
Interest
Income
|
(0.4)
|
(0.5)
|
|
(0.6)
|
(0.8)
|
|
|
Income Tax
Benefit
|
(15.9)
|
(22.6)
|
|
(11.4)
|
(40.1)
|
|
|
Depreciation and
Amortization
|
137.1
|
132.4
|
|
272.2
|
262.1
|
|
EBITDA
|
167.4
|
155.9
|
|
372.6
|
278.4
|
|
|
Add
Back:
|
|
|
|
|
|
|
|
Restructuring
Charges (b)
|
8.5
|
8.2
|
|
16.7
|
101.0
|
|
|
Acquisition-related Costs (c)
|
4.4
|
16.3
|
|
11.4
|
26.5
|
|
|
Certain
Non-recurring Items (d)
|
-
|
-
|
|
-
|
(11.0)
|
|
Adjusted
EBITDA
|
$
180.3
|
$
180.4
|
|
$
400.7
|
$
394.9
|
|
|
|
|
|
|
|
|
|
(a)
|
Unaudited.
|
|
(b)
|
Restructuring
charges for the three and six months ended June 30, 2017 and 2016
were primarily associated with the closure of 433,000 tons of chlor
alkali capacity across three separate Olin locations. For the
six months ended June 30, 2016, $76.6 million of these charges were
non-cash impairment charges for equipment and
facilities.
|
|
(c)
|
Acquisition-related costs for the three and six
months ended June 30, 2017 and 2016 were associated with our
integration of the Acquired Business.
|
|
(d)
|
Certain
non-recurring items for the six months ended June 30, 2016 included
an $11.0 million insurance recovery for property damage and
business interruption related to a 2008 Henderson, NV chlor alkali
facility incident.
|
|
View original
content:http://www.prnewswire.com/news-releases/olin-announces-second-quarter-2017-earnings-and-reiterates-full-year-2017-guidance-300496924.html
SOURCE Olin Corporation