PHILADELPHIA, Nov. 2, 2020 /PRNewswire/ --
Third Quarter 2020 Highlights
- Revenue of $1.08 billion, up 7
percent versus Q3 2019, up 15 percent organically1
- Consolidated GAAP net income of $112
million, up 25 percent versus Q3 2019
- Adjusted EBITDA of $263 million,
up 20 percent versus Q3 2019
- Consolidated GAAP earnings of $0.85 per diluted share, up 23 percent versus Q3
2019
- Consolidated adjusted earnings per diluted share of
$1.22, up 30 percent versus Q3
2019
Full-Year Outlook Highlights2
- Revenue outlook range of $4.72 to
$4.78 billion, reflecting 3 percent
growth at the midpoint versus 2019 and 9 percent organic
growth1
- Raising adjusted EBITDA outlook to a range of $1.295 to $1.315
billion, reflecting 7 percent growth at the midpoint versus
2019
- Raising adjusted earnings guidance to a range of $6.45 to $6.57 per
diluted share, reflecting 7 percent growth at the midpoint versus
2019
- Raising free cash flow guidance to a range of $475 to $525
million, reflecting 66 percent growth at midpoint versus
2019
FMC Corporation (NYSE: FMC) today reported third quarter 2020
revenue of approximately $1.08 billion, an increase of 7 percent
versus third quarter 2019. Excluding the impact of foreign
currencies, organic sales grew 15 percent year over year. On a GAAP
basis, the company reported earnings of $0.85 per diluted share in the third
quarter, an increase of 23 percent versus third quarter 2019.
Adjusted earnings were $1.22 per
diluted share, an increase of 30 percent versus third quarter
2019, and 12 cents above the midpoint of guidance.
Third Quarter Adj.
EPS versus Guidance (midpoint)*
|
+12
cents**
|
EBITDA
|
+12 cents
|
Depreciation &
amortization
|
-1 cent
|
Interest
expense
|
+1 cent
|
Non-controlling
interest
|
+1 cent
|
|
* Guidance refers to
midpoint of EPS guidance presented on August 4, 2020
|
** Contributing
factors do not sum to 12 cents, due to rounding
|
Mark Douglas, FMC president and
CEO said: "FMC's third quarter performance is a testament to our
geographic balance, the strength in demand for our technology
portfolio and the continued cost reductions to weather the global
pandemic. Given robust demand in the third quarter and continuing
strong execution, we are raising our 2020 outlook."
The revenue increase was driven by 12 percent contribution from
volume and 3 percent from pricing gains, offset by an 8 percent
headwind from foreign currencies. In Asia, revenue increased 16 percent year
over year, and 19 percent excluding FX. Volume growth in
India, Australia, Pakistan and Indonesia was partially offset by FX
headwinds. Latin America sales
grew 1 percent year over year, and 18 percent excluding FX
headwinds. Pricing helped offset some of the FX headwinds, while
the underlying volume gains came from strong insecticide sales in
Brazil for soybeans and specialty
crops. In North America, sales
increased 8 percent year over year, driven primarily by strong
herbicide and fungicide sales. Sales in EMEA increased
10 percent year over year, due to a particularly strong
quarter for insecticides and cereal herbicides. There was no
impact from foreign exchange in EMEA in the quarter.
FMC
Revenue
|
Q3
2020
|
Organic
Growth
|
15%
|
FX Impact
|
(8%)
|
Total Revenue
Change
|
7%
|
2020 Outlook2
The company is forecasting full-year 2020 revenue to be in the
range of $4.72 billion to
$4.78 billion, representing an
increase of 3 percent at the midpoint versus 2019. Organic growth
is expected to be 9 percent. Full-year adjusted EBITDA is now
expected to be in the range of $1.295
billion to $1.315 billion,
representing 7 percent year-over-year growth at the midpoint and an
increase of $10 million versus prior
guidance. 2020 adjusted earnings are now expected to be in the
range of $6.45 to $6.57 per diluted share, representing a
year-over-year increase of 7 percent at the midpoint and
6 cents higher than prior forecast.
Full-year earnings growth drivers include significant volume gains
in Latin America and Asia, global pricing and continued cost
discipline. The company expects full-year free cash flow to be
$475 to $525
million, representing a 66 percent increase year-over-year
and $25 million higher than prior
guidance at the midpoint.
Fourth Quarter Outlook2
Fourth quarter revenue is expected to be in the range of
$1.23 billion to $1.29 billion, representing a 5 percent increase
at the midpoint compared to fourth quarter 2019, and organic growth
of 10 percent excluding foreign currency headwinds.
Adjusted EBITDA is forecasted to be in the range of
$335 million to $355 million,
representing an 8 percent increase at the midpoint versus Q4 2019.
FMC expects adjusted earnings per diluted share to be in the range
of $1.70 to $1.82 in the fourth quarter, which at the
midpoint would be equal to Q4 2019 due to a large positive tax
adjustment in the prior year period. The company expects to deploy
approximately $170 million of cash in
the quarter. This includes paying $57
million in dividends on October
15, closing the previously announced Fluindapyr acquisition
for $65 million in early October, and
$50 million in planned share
repurchases, which restarted in October.
|
Full Year
Outlook
|
|
Q4 2020
Outlook
|
Revenue
|
$4.72 to $4.78
billion
|
|
$1.23 to $1.29
billion
|
Organic
Growth
|
9%
|
|
10%
|
Estimated FX
Impact
|
(6%)
|
|
(5%)
|
Growth at midpoint
vs. 2019
|
3%
|
|
5%
|
Adjusted
EBITDA
|
$1.295 to $1.315
billion
|
|
$335 to $355
million
|
Growth at midpoint
vs. 2019
|
7%
|
|
8%
|
Adjusted
EPS^
|
$6.45 to
$6.57
|
|
$1.70 to
$1.82
|
Growth at midpoint
vs. 2019
|
7%
|
|
0%*
|
|
|
^ EPS estimates
assume 131 million diluted shares. Planned Q4 share repurchases of
$50 million are not expected to have any material impact on FMC
diluted shares outstanding in the current year.
|
* Q4 2019 adjusted
EPS benefited from a large tax adjustment.
|
Supplemental Information
The company will post supplemental information on the web at
https://investors.fmc.com, including its webcast slides for
tomorrow's earnings call, definitions of non-GAAP terms and
reconciliations of non-GAAP figures to the nearest available GAAP
term.
About FMC
FMC Corporation, an agricultural sciences company, provides
innovative solutions to growers around the world with a robust
product portfolio fueled by a market-driven discovery and
development pipeline in crop protection, plant health, and
professional pest and turf management. This powerful combination of
advanced technologies includes leading insect control products
based on Rynaxypyr® and Cyazypyr® active
ingredients; Authority®, Boral®, Centium®, Command® and Gamit®
branded herbicides; Talstar® and Hero® branded insecticides; and
flutriafol-based fungicides. The FMC portfolio also includes
biologicals such as Quartzo® and Presence® bionematicides. FMC
Corporation employs approximately 6,400 employees around the globe.
To learn more, please visit www.fmc.com.
FMC, the FMC logo, Rynaxypyr, Cyazypyr, Authority, Boral,
Centium, Command, Gamit, Talstar, Hero, Quartzo and Presence are
trademarks of FMC Corporation or an affiliate. Always read and
follow all label directions, restrictions and precautions for use.
Products listed here may not be registered for sale or use in all
states, countries or jurisdictions. Hero® insecticide is a
restricted use pesticide in the United
States.
The Company's investor relations website, located at
https://investors.fmc.com, should be considered as a recognized
channel of distribution, and the Company may periodically post
important information to the web site for investors, including
information that the Company may wish to disclose publicly for
purposes of complying with the federal securities laws. After
April 27, 2021, this type of
information will no longer be provided by press release but will
continue to be posted on the investor relations website.
Statement under the Safe Harbor Provisions of the Private
Securities Litigation Reform Act of 1995: FMC and its
representatives may from time to time make written or oral
statements that are "forward-looking" and provide other than
historical information, including statements contained in this
press release, in FMC's other filings with the SEC, and in reports
or letters to FMC stockholders.
In some cases, FMC has identified forward-looking statements
by such words or phrases as "will likely result," "is confident
that," "expect," "expects," "should," "could," "may," "will
continue to," "believe," "believes," "anticipates," "predicts,"
"forecasts," "estimates," "projects," "potential," "intends" or
similar expressions identifying "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995, including the negative of those words and phrases. Such
forward-looking statements are based on management's current views
and assumptions regarding future events, future business conditions
and the outlook for the company based on currently available
information. These statements involve known and unknown risks,
uncertainties and other factors that may cause actual results to be
materially different from any results, levels of activity,
performance or achievements expressed or implied by any
forward-looking statement. Currently, one of the most significant
factors is the potential adverse effect of the current COVID-19
pandemic on the financial condition, results of operations, cash
flows and performance of FMC, which is substantially influenced by
the potential adverse effect of the pandemic on FMC's customers and
suppliers and the global economy and financial markets. The extent
to which COVID-19 impacts us will depend on future developments,
which are highly uncertain and cannot be predicted with confidence,
including the scope, severity and duration of the pandemic, the
actions taken to contain the pandemic or mitigate its impact, and
the direct and indirect economic effects of the pandemic and
containment measures, among others. Additional factors
include, among other things, the risk factors and cautionary
statements included within FMC's 2019 Form 10-K and FMC's Form 10-Q
for the quarter ended September 30,
2020. Moreover, investors are cautioned to interpret many of
these factors as being heightened as a result of the ongoing and
numerous adverse impacts of the COVID-19 pandemic.
FMC cautions readers not to place undue reliance on any
forward-looking statements, which speak only as of the date made.
Forward-looking statements are qualified in their entirety by the
above cautionary statement. FMC undertakes no obligation, and
specifically disclaims any duty, to update or revise any
forward-looking statements to reflect events or circumstances
arising after the date on which they were made, except as otherwise
required by law.
This press release contains certain "non-GAAP financial
terms" which are defined on our website www.fmc.com/investors. In
addition, we have also provided on our website reconciliations of
non-GAAP terms to the most directly comparable GAAP term.
- Organic revenue growth (non-GAAP) excludes the impact of
foreign currency changes.
- Although we provide forecasts for adjusted earnings per share
and adjusted EBITDA (non-GAAP financial measures), we are not able
to forecast the most directly comparable measures calculated and
presented in accordance with GAAP. Certain elements of the
composition of the GAAP amounts are not predictable, making it
impractical for us to forecast. Such elements include, but are not
limited to, restructuring, acquisition charges, and discontinued
operations. As a result, no GAAP outlook is provided.
FMC
CORPORATION
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(Unaudited, in
millions, except per share amounts)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Revenue
|
$
|
1,084.6
|
|
|
$
|
1,014.3
|
|
|
$
|
3,489.9
|
|
|
$
|
3,412.5
|
|
Costs of sales and
services
|
618.2
|
|
|
581.9
|
|
|
1,939.3
|
|
|
1,884.9
|
|
Gross
margin
|
$
|
466.4
|
|
|
$
|
432.4
|
|
|
$
|
1,550.6
|
|
|
$
|
1,527.6
|
|
Selling, general and
administrative expenses
|
187.7
|
|
|
188.3
|
|
|
548.1
|
|
|
569.1
|
|
Research and
development expenses
|
71.7
|
|
|
77.4
|
|
|
203.3
|
|
|
221.7
|
|
Restructuring and
other charges (income)
|
11.0
|
|
|
6.8
|
|
|
43.9
|
|
|
27.3
|
|
Total costs and
expenses
|
$
|
888.6
|
|
|
$
|
854.4
|
|
|
$
|
2,734.6
|
|
|
$
|
2,703.0
|
|
Income from
continuing operations before non-operating pension and
postretirement charges (income), interest expense, net and income
taxes
|
$
|
196.0
|
|
|
$
|
159.9
|
|
|
$
|
755.3
|
|
|
$
|
709.5
|
|
Non-operating pension
and postretirement charges (income)
|
11.6
|
|
|
(1.2)
|
|
|
16.0
|
|
|
5.5
|
|
Interest expense,
net
|
35.5
|
|
|
41.6
|
|
|
117.0
|
|
|
115.6
|
|
Income (loss) from
continuing operations before income taxes
|
$
|
148.9
|
|
|
$
|
119.5
|
|
|
$
|
622.3
|
|
|
$
|
588.4
|
|
Provision (benefit)
for income taxes
|
18.4
|
|
|
8.7
|
|
|
82.3
|
|
|
75.6
|
|
Income (loss) from
continuing operations
|
$
|
130.5
|
|
|
$
|
110.8
|
|
|
$
|
540.0
|
|
|
$
|
512.8
|
|
Discontinued
operations, net of income taxes
|
(18.4)
|
|
|
(21.3)
|
|
|
(36.7)
|
|
|
(29.8)
|
|
Net income
(loss)
|
$
|
112.1
|
|
|
$
|
89.5
|
|
|
$
|
503.3
|
|
|
$
|
483.0
|
|
Less: Net income
(loss) attributable to noncontrolling interests
|
0.7
|
|
|
(0.9)
|
|
|
1.3
|
|
|
2.4
|
|
Net income (loss)
attributable to FMC stockholders
|
$
|
111.4
|
|
|
$
|
90.4
|
|
|
$
|
502.0
|
|
|
$
|
480.6
|
|
Amounts
attributable to FMC stockholders:
|
|
|
|
|
|
|
|
Income (loss)
from continuing operations
|
$
|
129.8
|
|
|
$
|
111.7
|
|
|
$
|
538.7
|
|
|
$
|
510.4
|
|
Discontinued
operations, net of tax
|
(18.4)
|
|
|
(21.3)
|
|
|
(36.7)
|
|
|
(29.8)
|
|
Net income
(loss)
|
$
|
111.4
|
|
|
$
|
90.4
|
|
|
$
|
502.0
|
|
|
$
|
480.6
|
|
Basic earnings
(loss) per common share attributable to FMC
stockholders:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
|
1.00
|
|
|
$
|
0.85
|
|
|
$
|
4.14
|
|
|
$
|
3.88
|
|
Discontinued
operations
|
(0.14)
|
|
|
(0.16)
|
|
|
(0.28)
|
|
|
(0.22)
|
|
Basic
earnings per common share
|
$
|
0.86
|
|
|
$
|
0.69
|
|
|
$
|
3.86
|
|
|
$
|
3.66
|
|
Average number of
shares outstanding used in basic earnings per share
computations
|
129.9
|
|
|
130.4
|
|
|
129.7
|
|
|
131.1
|
|
Diluted earnings
(loss) per common share attributable to FMC
stockholders:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
|
0.99
|
|
|
$
|
0.85
|
|
|
$
|
4.12
|
|
|
$
|
3.85
|
|
Discontinued
operations
|
(0.14)
|
|
|
(0.16)
|
|
|
(0.28)
|
|
|
(0.22)
|
|
Diluted
earnings per common share
|
$
|
0.85
|
|
|
$
|
0.69
|
|
|
$
|
3.84
|
|
|
$
|
3.63
|
|
Average number of
shares outstanding used in diluted earnings per share
computations
|
130.8
|
|
|
131.6
|
|
|
130.6
|
|
|
132.4
|
|
|
|
|
|
|
|
|
|
Other
Data:
|
|
|
|
|
|
|
|
Capital additions and
other investing activities
|
$
|
14.5
|
|
|
$
|
41.1
|
|
|
$
|
58.3
|
|
|
$
|
77.5
|
|
Depreciation and
amortization expense
|
41.5
|
|
|
36.6
|
|
|
120.7
|
|
|
111.1
|
|
FMC
CORPORATION
RECONCILIATION OF
NON-GAAP FINANCIAL MEASURES
|
|
RECONCILIATION OF
NET INCOME (LOSS) ATTRIBUTABLE TO FMC STOCKHOLDERS (GAAP) TO
ADJUSTED AFTER-TAX EARNINGS FROM CONTINUING OPERATIONS,
ATTRIBUTABLE TO FMC STOCKHOLDERS (NON-GAAP)
(Unaudited, in
millions, except per share amounts)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Net income (loss)
attributable to FMC stockholders (GAAP)
|
$
|
111.4
|
|
|
$
|
90.4
|
|
|
$
|
502.0
|
|
|
$
|
480.6
|
|
Corporate special
charges (income):
|
|
|
|
|
|
|
|
Restructuring and
other charges (income) (a)
|
11.0
|
|
|
6.8
|
|
|
43.9
|
|
|
27.3
|
|
Non-operating pension
and postretirement charges (income) (b)
|
11.6
|
|
|
(1.2)
|
|
|
16.0
|
|
|
5.5
|
|
Transaction-related
charges (c)
|
14.4
|
|
|
16.0
|
|
|
40.4
|
|
|
52.6
|
|
Income tax expense
(benefit) on Corporate special charges (income)
(d)
|
(6.1)
|
|
|
0.8
|
|
|
(16.9)
|
|
|
(12.0)
|
|
Discontinued
operations attributable to FMC stockholders, net of income taxes
(e)
|
18.4
|
|
|
21.3
|
|
|
36.7
|
|
|
29.8
|
|
Tax adjustment
(f)
|
(0.6)
|
|
|
(9.9)
|
|
|
1.6
|
|
|
(10.1)
|
|
Adjusted after-tax
earnings from continuing operations attributable to FMC
stockholders (Non-GAAP) (1)
|
$
|
160.1
|
|
|
$
|
124.2
|
|
|
$
|
623.7
|
|
|
$
|
573.7
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
common share (GAAP)
|
$
|
0.85
|
|
|
$
|
0.69
|
|
|
$
|
3.84
|
|
|
$
|
3.63
|
|
Corporate special
charges (income) per diluted share, before tax:
|
|
|
|
|
|
|
|
Restructuring and
other charges (income)
|
0.08
|
|
|
0.05
|
|
|
0.34
|
|
|
0.21
|
|
Non-operating pension
and postretirement charges (income)
|
0.09
|
|
|
(0.01)
|
|
|
0.13
|
|
|
0.04
|
|
Transaction-related
charges
|
0.11
|
|
|
0.12
|
|
|
0.31
|
|
|
0.40
|
|
Income tax expense
(benefit) on Corporate special charges (income), per diluted
share
|
(0.05)
|
|
|
0.01
|
|
|
(0.13)
|
|
|
(0.10)
|
|
Discontinued
operations attributable to FMC stockholders, net of income taxes
per diluted share
|
0.14
|
|
|
0.16
|
|
|
0.28
|
|
|
0.22
|
|
Tax adjustments per
diluted share
|
—
|
|
|
(0.08)
|
|
|
0.01
|
|
|
(0.08)
|
|
Diluted adjusted
after-tax earnings from continuing operations per share,
attributable to FMC stockholders (Non-GAAP)
|
$
|
1.22
|
|
|
$
|
0.94
|
|
|
$
|
4.78
|
|
|
$
|
4.32
|
|
|
|
|
|
|
|
|
|
Average number of
shares outstanding used in diluted adjusted after-tax earnings from
continuing operations per share computations
|
130.8
|
|
|
131.6
|
|
|
130.6
|
|
|
132.4
|
|
|
|
____________________
|
(1)
|
The Company believes
that the Non-GAAP financial measure "Adjusted after-tax earnings
from continuing operations attributable to FMC stockholders" and
its presentation on a per share basis provides useful information
about the Company's operating results to management, investors, and
securities analysts. Adjusted earnings excludes the effects of
corporate special charges, tax-related adjustments and the results
of our discontinued operations. The Company also believes that
excluding the effects of these items from operating results allows
management and investors to compare more easily the financial
performance of its underlying business from period to
period.
|
|
|
(a)
|
Three Months Ended
September 30, 2020:
|
|
|
|
Restructuring and
other charges (income) is primarily comprised of charges associated
with certain in-flight restructuring programs from the integration
of the DuPont Crop Protection Business. These charges include
severance, accelerated depreciation on certain fixed assets, and
other costs of $6.4 million. The remaining restructuring and other
charges (income) primarily includes charges of environmental sites
of $4.0 million.
|
|
|
|
Three Months Ended
September 30, 2019:
|
|
|
|
Restructuring and
other charges (income) is comprised of charges associated with the
integration of the DuPont Crop Protection Business. These charges
include severance and other costs (benefits) of $2.6 million. All
other charges were $4.2 million, which includes charges of
environmental sites treated as a Corporate charge of $4.1
million.
|
|
|
|
Nine Months Ended
September 30, 2020:
|
|
|
|
Restructuring and
other charges (income) is primarily comprised of charges associated
with the integration of the DuPont Crop Protection Business. These
charges include severance, accelerated depreciation on certain
fixed assets, and other costs of $29.6 million. The remaining
restructuring and other charges (income) primarily includes charges
of environmental sites of $13.7 million.
|
|
|
|
Nine Months Ended
September 30, 2019:
|
|
|
|
Restructuring and
other charges (income) is comprised of charges associated with the
integration of the DuPont Crop Protection Business. These charges
include severance, accelerated depreciation on certain fixed
assets, and other costs (benefits) of $13.2 million. Additionally,
restructuring and other charges (income) includes charges of
environmental sites treated as a Corporate charge of $12.3 million
and other miscellaneous restructuring and other charges totaling
$1.8 million.
|
|
|
(b)
|
Our non-operating
pension and postretirement charges (income) are defined as those
costs (benefits) related to interest, expected return on plan
assets, amortized actuarial gains and losses and the impacts of any
plan curtailments or settlements. These are excluded from our
Adjusted Earnings and are primarily related to changes in pension
plan assets and liabilities which are tied to financial market
performance and we consider these costs to be outside our
operational performance. We continue to include the service cost
and amortization of prior service cost in our Adjusted Earnings
results noted above. These elements reflect the current year
operating costs to our businesses for the employment benefits
provided to active employees.
|
|
|
(c)
|
Charges related to
legal and professional fees associated with acquisition activities.
Except for the completion of certain in-flight initiatives,
primarily associated with the finalization of our worldwide ERP
system, we completed the integration of the DuPont Crop Protection
Business as of June 30, 2020. The transition services agreement is
now terminated and the last phase of the ERP system transition went
live in November 2020 with a stabilization period that will go into
the first quarter of 2021. We anticipate remaining expense of
approximately $15 million to $20 million for the completion of
these defined in-flight initiatives during the remaining time
period.
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
(in
Millions)
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
DuPont Crop
Protection Business Acquisition
|
|
|
|
|
|
|
|
|
|
Legal
and professional fees (1)
|
$
|
14.4
|
|
|
$
|
16.0
|
|
|
$
|
40.4
|
|
|
$
|
52.6
|
|
|
|
Total Transaction-related charges
|
$
|
14.4
|
|
|
$
|
16.0
|
|
|
$
|
40.4
|
|
|
$
|
52.6
|
|
|
|
____________________
|
|
|
(1)
|
Represents
transaction costs, costs for transitional employees, other acquired
employees related costs, and transactional-related costs such as
legal and professional third-party fees. These charges are recorded
as a component of "Selling, general and administrative expense" on
the condensed consolidated statements of income (loss).
|
(d)
|
The income tax
expense (benefit) on Corporate special charges (income) is
determined using the applicable rates in the taxing jurisdictions
in which the corporate special charge or income occurred and
includes both current and deferred income tax expense (benefit)
based on the nature of the non-GAAP performance measure.
|
|
|
(e)
|
Three and Nine
Months Ended September 30, 2020 and 2019
|
|
|
|
Discontinued
operations, net of income taxes include, in periods up to its
separation on March 1, 2019, the results of FMC Lithium, including
separation-related costs, as well as provisions, net of recoveries,
for environmental liabilities and legal reserves and expenses
related to previously discontinued operations. During the nine
months ended September 30, 2019, we finalized the sale of the first
of two parcels of land of our discontinued site in Newark,
California. The gain on sale was approximately $21 million, net of
tax, and was partially offset by the results of our FMC Lithium
business, which was a net loss due to separation-related costs.
These events did not recur in the current period.
|
|
|
(f)
|
We exclude the GAAP
tax provision, including discrete items, from the Non-GAAP measure
of income, and include a Non-GAAP tax provision based upon the
projected annual Non-GAAP effective tax rate. The GAAP tax
provision includes certain discrete tax items including, but are
not limited to: income tax expenses or benefits that are not
related to continuing operating results in the current year; tax
adjustments associated with fluctuations in foreign currency
remeasurement of certain foreign operations; certain changes in
estimates of tax matters related to prior fiscal years; certain
changes in the realizability of deferred tax assets and related
interim accounting impacts; and changes in tax law. Management
believes excluding these discrete tax items assists investors and
securities analysts in understanding the tax provision and the
effective tax rate related to continuing operating results thereby
providing investors with useful supplemental information about
FMC's operational performance.
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
(in
Millions)
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
|
Non-GAAP tax
adjustments
|
|
|
|
|
|
|
|
|
|
Revisions to valuation allowances of historical
deferred tax assets
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(0.4)
|
|
|
$
|
0.6
|
|
|
|
Foreign
currency remeasurement and other
discrete items
|
|
(0.6)
|
|
|
|
(9.9)
|
|
|
2.0
|
|
|
(10.7)
|
|
|
|
Total Non-GAAP tax
adjustments
|
$
|
(0.6)
|
|
|
$
|
(9.9)
|
|
|
$
|
1.6
|
|
|
$
|
(10.1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION OF
NET INCOME (LOSS) (GAAP) TO ADJUSTED EARNINGS FROM CONTINUING
OPERATIONS, BEFORE INTEREST, INCOME TAXES, DEPRECIATION AND
AMORTIZATION, AND NONCONTROLLING INTERESTS
(NON-GAAP)
(Unaudited, in
millions)
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Net income (loss)
(GAAP)
|
$
|
112.1
|
|
|
$
|
89.5
|
|
|
$
|
503.3
|
|
|
$
|
483.0
|
|
Restructuring and other charges (income)
|
11.0
|
|
|
6.8
|
|
|
43.9
|
|
|
27.3
|
|
Non-operating pension and postretirement charges
(income)
|
11.6
|
|
|
(1.2)
|
|
|
16.0
|
|
|
5.5
|
|
Transaction-related charges
|
14.4
|
|
|
16.0
|
|
|
40.4
|
|
|
52.6
|
|
Discontinued operations, net of income taxes
|
18.4
|
|
|
21.3
|
|
|
36.7
|
|
|
29.8
|
|
Interest
expense, net
|
35.5
|
|
|
41.6
|
|
|
117.0
|
|
|
115.6
|
|
Depreciation and amortization
|
41.5
|
|
|
36.6
|
|
|
120.7
|
|
|
111.1
|
|
Provision (benefit) for income taxes
|
18.4
|
|
|
8.7
|
|
|
82.3
|
|
|
75.6
|
|
Adjusted earnings
from continuing operations, before interest, income taxes,
depreciation and amortization, and noncontrolling interests
(Non-GAAP) (1)
|
$
|
262.9
|
|
|
$
|
219.3
|
|
|
$
|
960.3
|
|
|
$
|
900.5
|
|
___________________
|
(1)
|
Referred to as
Adjusted EBITDA. Defined as operating profit excluding corporate
special charges (income) and depreciation and amortization
expense.
|
RECONCILIATION OF
CASH PROVIDED (REQUIRED) BY OPERATING ACTIVITIES OF
CONTINUING OPERATIONS (GAAP) TO FREE CASH FLOW
(NON-GAAP)
(Unaudited, in
millions)
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
Cash
provided (required) by operating activities of continuing
operations
(GAAP)(1)
|
$
|
361.9
|
|
|
$
|
282.6
|
|
|
$
|
313.5
|
|
|
$
|
65.8
|
|
Transaction and integration costs
|
13.8
|
|
|
18.4
|
|
|
53.3
|
|
|
61.5
|
|
Adjusted cash from
operations (2)
|
$
|
375.7
|
|
|
$
|
301.0
|
|
|
$
|
366.8
|
|
|
$
|
127.3
|
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
(12.0)
|
|
|
(21.3)
|
|
|
(35.2)
|
|
|
(56.8)
|
|
Other
investing activities
|
(2.5)
|
|
|
(19.8)
|
|
|
(23.1)
|
|
|
(20.7)
|
|
Capital additions
and other investing activities
|
$
|
(14.5)
|
|
|
$
|
(41.1)
|
|
|
$
|
(58.3)
|
|
|
$
|
(77.5)
|
|
|
|
|
|
|
|
|
|
Cash
provided (required) by operating activities of discontinued
operations
|
(21.0)
|
|
|
(27.5)
|
|
|
(66.3)
|
|
|
(36.2)
|
|
Cash provided (required) by investing activities of
discontinued operations
|
—
|
|
|
—
|
|
|
1.1
|
|
|
9.2
|
|
Transaction and integration costs
|
(13.8)
|
|
|
(18.4)
|
|
|
(53.3)
|
|
|
(61.5)
|
|
Investment in Enterprise Resource Planning system
|
(11.6)
|
|
|
(15.3)
|
|
|
(42.2)
|
|
|
(42.0)
|
|
Legacy and
transformation
|
$
|
(46.4)
|
|
|
$
|
(61.2)
|
|
|
$
|
(160.7)
|
|
|
$
|
(130.5)
|
|
|
|
|
|
|
|
|
|
Free cash flow
(Non-GAAP) (3)
|
$
|
314.8
|
|
|
$
|
198.7
|
|
|
$
|
147.8
|
|
|
$
|
(80.7)
|
|
___________________
|
(1)
|
The cash provided
(required) by operating activities for the three months ended
September 30, 2020 and 2019 is the calculation of the nine months
ended September 30, 2020 and 2019 less the previously reported six
months ended June 30, 2020 and 2019, respectively.
|
(2)
|
Adjusted cash from
operations is defined as cash provided (required) by operating
activities of continuing operations excluding the effects of
transaction-related cash flows.
|
(3)
|
Free cash flow is
defined as Adjusted cash from operations reduced by spending for
capital additions and other investing activities as well as legacy
and transformation spending. We believe that this Non-GAAP
financial measure provides a useful basis for investors and
securities analysts about the cash generated by routine business
operations, including capital expenditures, in addition to
assessing our ability to repay debt, fund acquisitions and return
capital to shareholders through share repurchases and dividends.
Our use of free cash flow has limitations as an analytical tool and
should not be considered in isolation or as a substitute for an
analysis of our results under U.S. GAAP.
|
RECONCILIATION OF
REVENUE CHANGE (GAAP) TO
ORGANIC REVENUE
CHANGE (NON-GAAP) (1)
(Unaudited)
|
|
|
Three Months
Ended
September 30, 2020 vs. 2019
|
|
Nine Months
Ended
September 30, 2020 vs. 2019
|
Total Revenue
Change (GAAP)
|
7
|
%
|
|
2
|
%
|
Less:
Foreign Currency Impact
|
(8)
|
%
|
|
(7)
|
%
|
Organic Revenue
Change (Non-GAAP)
|
15
|
%
|
|
9
|
%
|
|
|
|
|
|
|
|
Full Year
Outlook
|
|
Q4 2020
Outlook
|
Projected Total
Revenue Change at Midpoint (GAAP)
|
3
|
%
|
|
5
|
%
|
Less:
Estimated Foreign Currency Impact
|
(6)
|
%
|
|
(5)
|
%
|
Projected Organic
Revenue Change (Non-GAAP)
|
9
|
%
|
|
10
|
%
|
___________________
|
(1)
|
We believe organic
revenue growth (non-GAAP) provides management and investors with
useful supplemental information regarding our ongoing revenue
performance and trends by presenting revenue growth excluding the
impact of fluctuations in foreign exchange rates.
|
FMC
CORPORATION
CONDENSED
CONSOLIDATED BALANCE SHEETS
(Unaudited, in
millions)
|
|
|
September 30,
2020
|
|
December 31,
2019
|
Cash and cash
equivalents
|
$
|
297.1
|
|
|
$
|
339.1
|
|
Trade receivables,
net of allowance of $22.5 in 2020 and $26.3 in 2019
|
2,137.9
|
|
|
2,231.2
|
|
Inventories
|
1,155.5
|
|
|
1,017.0
|
|
Prepaid and other
current assets
|
424.7
|
|
|
487.5
|
|
Total current
assets
|
$
|
4,015.2
|
|
|
$
|
4,074.8
|
|
|
|
|
|
Property, plant and
equipment, net
|
739.2
|
|
|
758.0
|
|
Goodwill
|
1,464.2
|
|
|
1,467.5
|
|
Other intangibles,
net
|
2,610.6
|
|
|
2,629.0
|
|
Deferred income
taxes
|
256.7
|
|
|
257.4
|
|
Other long-term
assets
|
686.3
|
|
|
686.0
|
|
Total
assets
|
$
|
9,772.2
|
|
|
$
|
9,872.7
|
|
|
|
|
|
Short-term debt and
current portion of long-term debt
|
$
|
194.1
|
|
|
$
|
227.7
|
|
Accounts payable,
trade and other
|
757.2
|
|
|
900.1
|
|
Advanced payments
from customers
|
5.5
|
|
|
492.7
|
|
Accrued and other
liabilities
|
683.6
|
|
|
680.6
|
|
Accrued customer
rebates
|
530.7
|
|
|
280.6
|
|
Guarantees of vendor
financing
|
97.0
|
|
|
75.7
|
|
Accrued pensions and
other postretirement benefits, current
|
4.3
|
|
|
4.3
|
|
Income
taxes
|
95.9
|
|
|
62.2
|
|
Total current
liabilities
|
$
|
2,368.3
|
|
|
$
|
2,723.9
|
|
|
|
|
|
Long-term debt, less
current portion
|
$
|
3,028.3
|
|
|
$
|
3,031.1
|
|
Long-term
liabilities
|
1,407.2
|
|
|
1,556.3
|
|
Equity
|
2,968.4
|
|
|
2,561.4
|
|
Total liabilities
and equity
|
$
|
9,772.2
|
|
|
$
|
9,872.7
|
|
FMC
CORPORATION
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in
millions)
|
|
|
Nine Months Ended
September 30,
|
|
2020
|
|
2019
|
Cash provided
(required) by operating activities of continuing
operations
|
$
|
313.5
|
|
|
$
|
65.8
|
|
|
|
|
|
Cash provided
(required) by operating activities of discontinued
operations
|
(66.3)
|
|
|
(36.2)
|
|
|
|
|
|
Cash provided
(required) by investing activities of continuing
operations
|
(100.5)
|
|
|
(119.5)
|
|
|
|
|
|
Cash provided
(required) by investing activities of discontinued
operations
|
1.1
|
|
|
9.2
|
|
|
|
|
|
Cash provided
(required) by financing activities of continuing
operations
|
(186.4)
|
|
|
374.8
|
|
|
|
|
|
Cash provided
(required) by financing activities of discontinued
operations
|
—
|
|
|
(37.2)
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
(3.4)
|
|
|
1.1
|
|
Increase (decrease)
in cash and cash equivalents
|
$
|
(42.0)
|
|
|
$
|
258.0
|
|
|
|
|
|
Cash and cash
equivalents of continuing operations, beginning of
period
|
$
|
339.1
|
|
|
$
|
134.4
|
|
Cash and cash
equivalents of discontinued operations
|
—
|
|
|
27.3
|
|
Cash and cash
equivalents, beginning of period
|
$
|
339.1
|
|
|
$
|
161.7
|
|
|
|
|
|
Cash and cash
equivalents, end of period
|
$
|
297.1
|
|
|
$
|
419.7
|
|
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SOURCE FMC Corporation