- Fourth quarter diluted EPS from continuing operations
of $0.15, before Infrastructure Segment restructuring charge;
including restructuring charge, diluted EPS of
($0.62)
- Fourth quarter restructuring charge of $84.4 million or
$0.77 per diluted share. Company anticipates Infrastructure
Segment benefits of approximately $43 million in 2011 from
restructuring actions, or approximately $0.39 per share, and fully
annualized benefits of over $60 million beginning in 2012,
or approximately $0.54 per share
- Full-year free cash flow of $209 million,
exceeds Company's target
- Full-year diluted EPS from continuing
operations of $0.91, before restructuring charge; including
restructuring charge diluted EPS of $0.13
- Full-year sales of $3.04
billion
- Company reaffirms earnings guidance for 2011 in
the range of $1.25 to $1.35 per diluted share from continuing
operations
HARRISBURG, Pa., Jan. 27, 2011 (GLOBE NEWSWIRE) --Worldwide
industrial services and engineered products company Harsco
Corporation (NYSE:HSC) today reported fourth quarter and full-year
2010 results.
Fourth Quarter and Full-Year 2010
Highlights
Fourth quarter 2010 diluted EPS from continuing
operations were $0.15 before the Infrastructure Segment
restructuring charge; including the restructuring charge, diluted
EPS from continuing operations were a loss of ($0.62). This
compares with diluted EPS of $0.50 per share in the fourth quarter
of 2009; last year's fourth quarter results benefited by
approximately $0.14 per diluted share from a significantly lower
effective tax rate when compared with the fourth quarter of this
year, due to higher discrete tax benefits in 2009. Fourth
quarter 2010 income (loss) from continuing operations was $13.4
million before the restructuring charge; after the restructuring
charge was a loss of ($49.2) million. On a comparative basis,
fourth quarter 2009 income from continuing operations was $41.8
million. Sales in the fourth quarter 2010 declined
approximately 2 percent to $757 million principally due to foreign
currency translation, compared with $772 million in the fourth
quarter of last year. Foreign currency translation reduced
sales by approximately $19 million but did not have a material
effect on pre-tax income compared with the fourth quarter of
2009.
As previously announced, the Company incurred an $84.4 million
pre-tax restructuring charge in the fourth quarter of 2010, or
$0.77 per diluted share, to address the realignment of the
Company's Infrastructure business and position it for a return to
profitability and future growth. The Company's actions are
expected to generate pre-tax savings of approximately $43 million
in 2011, or approximately $0.39 per diluted share, and over $60
million when fully annualized in 2012, or approximately $0.54 per
diluted share.
For the full-year 2010, diluted EPS from continuing operations
were $0.91 before the Infrastructure Segment restructuring charge;
including the restructuring charge diluted EPS were $0.13. This
compares with diluted EPS of $1.66 per share for the full-year
2009. Last year's results benefited by approximately $0.28
per share from a significantly lower effective tax rate when
compared with 2010 results, due to higher discrete tax benefits in
2009. Full-year 2010 income from continuing operations was
$79.2 million before the restructuring charge; including the
restructuring charge was $16.6 million. On a comparative
basis, full-year 2009 income from continuing operations was $140.8
million. Sales for the full-year 2010 were $3.04 billion,
compared with sales of $2.99 billion in 2009. For the
full-year 2010, foreign currency translation reduced sales by
approximately $9 million, but increased pre-tax income by
approximately $4 million or $0.04 per diluted share when compared
with the results for the full-year 2009.
Comment
Commenting on the Company's results, Harsco Chairman, President
and Chief Executive Officer Salvatore D. Fazzolari said, "I am
pleased to report that we closed the year on a positive
note. We exceeded our earnings forecast for the fourth
quarter, we exceeded our very challenging free cash flow target for
the year, and we successfully executed the restructuring of the
Harsco Infrastructure Segment according to plan. This
restructuring will be substantially completed by the end of the
first quarter 2011. We ended the year with a strong balance
sheet and excellent financial flexibility.
"Our overall results for the fourth quarter were better than
expected, notwithstanding the restructuring charge for Harsco
Infrastructure. All of our operating units performed near or
better than expectations, with our Harsco Rail business again
exceeding expected results, partly due to a shipment accelerated to
the fourth quarter 2010 from the first quarter of 2011 at the
request of the customer. Within our newly constituted Harsco
Metals & Minerals reporting segment, the fourth quarter
contained a number of one-off charges that somewhat reduced this
Segment's otherwise encouraging performance. With the primary
restructuring actions of our Harsco Infrastructure business near
completion, this clearly sets the stage for improved results for
this business starting in the second quarter of 2011 and, with some
end-market improvement, a return to full-year profitability in 2012
and beyond.
"Most pleasing in the quarter were the strong free cash flows
that we generated. These results allowed the Company to
produce $209 million of free cash flow in 2010, above our stated
goal for the year of $200 million. In the past three years
(2008-2010), we have generated approximately $600 million in free
cash flow during arguably the most difficult economic period in the
modern history of the Company. This performance gives us further
confidence in our stated five-year goal of achieving $1 billion in
free cash flow in the period 2011-2015.
"As I stated at our December investor conference and as posted
to our Harsco website, much has been achieved over the past three
years to transform the Company. I believe that 2011 will be a
year of transition that will lay the foundation for an era of
continuing and consistent growth for the Company over the next five
years.
"As such, we are reaffirming the earnings guidance for 2011 that
we gave in December in the range of $1.25 to $1.35 per diluted
share from continuing operations. As we also stated in December,
however, results for the first quarter of 2011 will be lower than
those of the prior year first quarter due to the timing of
shipments in our Harsco Rail business, including the acceleration
of a shipment from the first quarter of 2011 into the fourth
quarter of 2010 at the customer's request, and the combination of
the carryover of restructuring efforts and lower year-over-year
volumes in the Middle East for our Harsco Infrastructure business.
Therefore, our present outlook is for first quarter 2011 earnings
from continuing operations to be in the range of $0.00 to $0.05 per
diluted share, compared with $0.10 per share in the first quarter
of 2010."
Fourth Quarter Business Review
Harsco Infrastructure
Sales in the fourth quarter decreased 8 percent to $265 million
from $287 million last year. Foreign currency translation
reduced sales by approximately $13 million in the quarter but did
not have a material effect on operating income when compared with
the fourth quarter of 2009. An operating loss, before
restructuring charges, of ($14.4) million was incurred in the
quarter, compared with operating income in last year's fourth
quarter of $2.2 million. As previously noted, during the
quarter the Company took an $84.4 million restructuring charge in
its Harsco Infrastructure segment to permanently reduce the cost
base of this business and set the stage for future earnings
growth.
Despite continuing adverse end-market conditions in the final
quarter of 2010, and the expected difficult first quarter of 2011,
the Company has a positive longer-term outlook for Harsco
Infrastructure. As noted in December, substantial
restructuring actions being taken are expected to result in
approximately $43 million in cost savings in 2011 for this business
and over $60 million once fully annualized in 2012. The
restructuring actions are on target to be substantially complete by
the end of the first quarter of 2011.
Further, there are some early indications that the severe
decline in non-residential construction in the end-markets served
by Harsco Infrastructure may be reaching a bottom in the first
quarter of 2011 and that a gradual turn-around in end-market
conditions may be in evidence in the latter part of 2011 or by
early 2012.
Harsco Metals & Minerals
Effective with the fourth quarter of 2010, the Company is now
reporting Harsco Metals and Harsco Minerals as one segment,
reflecting the increasing operating synergies of these businesses
within the Company's global markets.
Sales in the fourth quarter increased 4 percent to $372 million
from $356 million in last year's comparable quarter. Operating
income in the quarter was $23.9 million, compared with $25.7
million in last year's quarter. Operating margins in the
quarter were 6.4 percent, compared with 7.2 percent in last year's
quarter. Compared with the fourth quarter of 2009, foreign currency
translation reduced sales in the quarter by approximately $6
million and did not have a material effect on operating income.
When compared with last year's fourth quarter, the current
quarter included net special items such as severance, exit costs
and other items totaling approximately $5 million, which lowered
operating margins by approximately 130 basis points.
Looking ahead, the outlook for this Segment remains
positive. Global steel production appears to have stabilized,
with the potential for further growth from increased global
economic activity as well as future improvement in the global
non-residential construction market. In addition, the Company
continues to see significant new bidding activities for its wide
range of value-adding services to mills around the world, and also
anticipates the start-up in 2011 of several key contract awards
previously announced by the Company.
Harsco Rail
As expected, sales in the quarter decreased to $61 million, down
approximately 18 percent from sales of $75 million in the
comparable quarter of last year. Consequently, operating income of
$9.7 million was lower than the $12.5 million in last year's
comparable quarter, as expected. Nevertheless, operating
margins of 15.9 percent were still only 90 basis points lower than
the 16.8 percent operating margins reported in the fourth quarter
of 2009. Foreign currency did not have a meaningful impact on
results in the quarter when compared with the comparable prior year
quarter.
To reiterate previous communications, the quarterly results of
Harsco Rail are affected by the timing of unit deliveries as they
are completed. In the first half of 2010, there was a
significant acceleration of deliveries at the request of a major
customer, which therefore reduced delivery volumes in the second
half of the year. For the full year, however, Harsco Rail
achieved record sales, operating income and operating margins.
Another year of strong results is expected in 2011. This
outlook is underpinned by existing backlogs and strong new order
bidding activity, as the Company discussed at its December investor
conference, the content of which has been posted to the Company's
website at www.harsco.com.
Harsco Industrial
With the reporting of Harsco Minerals and Harsco Metals as one
segment, Harsco Industrial is now being reported as a stand-alone
business segment beginning with the fourth quarter of
2010.
Sales in the quarter increased by approximately 10 percent to
$60 million from last year's $55 million. However, operating
income of $10.4 million was 25 percent lower than last year's $14.0
million in the comparable quarter. Likewise, fourth quarter
2010 operating margins of 17.4 percent were lower than the 25.7
percent achieved in the comparable quarter of 2009. The
principal reasons for the lower operating income and margins in the
fourth quarter of 2010 in comparison with the same quarter last
year were higher LIFO cost in 2010 and the recovery of bad debt
expense in 2009. Foreign currency translation did not have a
material impact on results in the quarter when compared with the
fourth quarter of last year.
The outlook remains positive for Harsco Industrial. As
discussed at the Company's December investor conference, the new
executive management for this Segment sees significant growth
opportunities to expand this business beyond its traditional North
American focus and achieve a broader global market for its highly
engineered products. Included in this strategy is the
establishment of certain joint venture partnerships in key
geographies, several of which are currently under development.
Liquidity, Capital Resources and Other
Matters
Net cash provided by operating activities for the full year 2010
was $401 million, compared with $434 million for the prior
year. Net cash used by investing activities was $202 million,
compared with $269 million in 2009. A modest increase in
capital expenditures year-over-year of $27 million is principally
due to capital required for new contract signings in the Harsco
Metals & Minerals Segment. Free cash flow (cash from
operations less capital expenditures) was $209 million in 2010,
compared with the record $269 million in the prior year. The
year-over-year decline is the result of substantially lower income
for the Harsco Infrastructure business. The Company's target
is to average $200 million in free cash flow per year over the next
five years.
As a result of its strong free cash flows in 2010, the Company
reduced total debt as of December 31, 2010 to $885 million,
compared with total debt of $985 million at December 31, 2009, a
reduction of $100 million. The total debt-to-capital ratio at
December 31, 2010 was 37.6 percent, down from 39.5 percent as of
the prior year-end and the lowest year-end debt-to-capital ratio
since 1998.
Due to the difficult and challenging operating environment for
Harsco Infrastructure throughout the year, Economic Value Added
(EVA®) declined in 2010.
Discontinued Operations
For the full year 2010, discontinued operations were a loss
after tax of $4.1 million, or $0.05 per diluted share, compared
with a loss after tax of $15.1 million or $0.19 per diluted share
in 2009.
Forward Looking Statements
This news release contains forward-looking statements based on
management's current expectations, estimates and
projections. All statements that address expectations or
projections about the future, including statements about the
company's strategy for growth, product development, market
position, expected expenditures and financial results are
forward-looking statements. Some of the forward-looking
statements may be identified by words like "may," "could,"
"believes," "expects," "anticipates," "plans," "intends,"
"projects," "indicates," and similar expressions. These
statements are not guarantees of future performance and involve a
number of risks, uncertainties and assumptions. Many factors,
including those discussed more fully elsewhere in this release and
in documents filed with the Securities and Exchange Commission by
Harsco, particularly its latest annual report on Form 10-K and
quarterly report on Form 10-Q, as well as others, could cause
results to differ materially from those stated. These factors
include, but are not limited to, changes in the worldwide business
environment in which the Company operates, including general
economic conditions; changes in currency exchange rates, interest
rates, commodity and fuel costs and capital costs; changes in the
performance of the equity and debt markets that could affect, among
other things, the valuation of the assets in the Company's pension
plans and the accounting for pension assets, liabilities and
expenses; changes in governmental laws and regulations, including
environmental, tax and import tariff standards; market and
competitive changes, including pricing pressures, market demand and
acceptance for new products, services, and technologies; unforeseen
business disruptions in one or more of the many countries in
which the Company operates due to political instability, civil
disobedience, armed hostilities, public health issues or other
calamities; the seasonal nature of the Company's business; our
ability to successfully enter into new contracts and complete new
acquisitions or joint ventures in the timeframe contemplated or at
all; the recent global financial and credit crisis, which could
result in our customers curtailing development projects,
construction, production and capital expenditures, which, in turn,
could reduce the demand for our products and services and,
accordingly, our sales, margins and profitability; the financial
condition of the Company's customers, including the ability of
customers (especially those that may be highly leveraged and those
with inadequate liquidity) to maintain their credit availability;
the successful integration of the Company's strategic acquisitions;
the amount and timing of repurchases of the Company's common stock,
if any; our ability to successfully implement cost-reduction
initiatives; and other risk factors listed from time to time in the
Company's SEC reports. The Company undertakes no duty to
update forward-looking statements.
Conference Call
As previously announced, the Company will hold a conference call
today at 10:00 a.m. Eastern Time to discuss its results and respond
to questions from the investment community. The conference
call will be broadcast live through the Harsco Corporation website
at www.harsco.com. The call can also be accessed by telephone
by dialing (800) 611-4920, or (973) 200-3957 for international
callers. Enter Conference ID number 35483966. Listeners
are advised to dial in at least five minutes prior to the
call. Replays will be available via the Harsco website, or by
telephone beginning at approximately 11:00 am ET today through
Monday, January 31, 2011. The telephone replay dial-in number
is (800) 642-1687, or (706) 645‑9291 for international
callers. Enter Conference ID number 35483966.
About Harsco
Harsco Corporation is a diversified, global industrial services
and engineered products company serving major industries that are
fundamental to worldwide economic growth. Harsco's common
stock is a component of the S&P MidCap 400 Index and the
Russell 1000 Index. Additional information can be found
at www.harsco.com.
The Harsco Corporation logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=361
|
|
|
HARSCO CORPORATION
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) |
|
|
|
Three Months Ended
December 31 |
Twelve Months Ended
December 31 |
(In thousands, except per share
amounts) |
2010 |
2009 |
2010 |
2009 |
Revenues from continuing
operations: |
|
|
|
|
Service revenues |
$ 646,172 |
$ 651,117 |
$ 2,511,505 |
$ 2,442,198 |
Product revenues |
111,179 |
121,374 |
527,173 |
548,379 |
Total
revenues |
757,351 |
772,491 |
3,038,678 |
2,990,577 |
|
|
|
|
|
Costs and expenses from continuing
operations: |
|
|
|
|
Cost of services sold |
513,538 |
512,356 |
1,994,637 |
1,897,408 |
Cost of products sold |
78,645 |
75,669 |
342,242 |
354,730 |
Selling, general and administrative
expenses |
131,128 |
127,716 |
532,624 |
509,071 |
Research and development expenses |
1,293 |
915 |
4,271 |
3,151 |
Other expense |
88,493 |
1,133 |
86,473 |
7,561 |
Total costs and
expenses |
813,097 |
717,789 |
2,960,247 |
2,771,921 |
|
|
|
|
|
Operating income (loss) from
continuing operations |
(55,746) |
54,702 |
78,431 |
218,656 |
|
|
|
|
|
Interest income |
818 |
984 |
2,668 |
2,928 |
Interest expense |
(13,383) |
(16,126) |
(60,623) |
(62,746) |
|
|
|
|
|
Income (loss) from continuing
operations before income taxes and equity income |
(68,311) |
39,560 |
20,476 |
158,838 |
|
|
|
|
|
Income tax benefit (expense) |
19,020 |
2,000 |
(4,276) |
(18,509) |
Equity in income of unconsolidated
entities, net |
81 |
224 |
390 |
504 |
|
|
|
|
|
Income (loss) from continuing
operations |
(49,210) |
41,784 |
16,590 |
140,833 |
|
|
|
|
|
Discontinued
operations: |
|
|
|
|
Loss from discontinued business |
(1,054) |
(813) |
(7,249) |
(21,907) |
Income tax benefit
|
402 |
237 |
3,118 |
6,846 |
Loss from discontinued
operations |
(652) |
(576) |
(4,131) |
(15,061) |
Net Income (loss) |
(49,862) |
41,208 |
12,459 |
125,772 |
Less: Net income
attributable to noncontrolling interests |
(1,260) |
(1,813) |
(5,705) |
(6,995) |
Net Income (loss) attributable
to Harsco Corporation |
$ (51,122) |
$ 39,395 |
$ 6,754 |
$ 118,777 |
|
|
|
|
|
Amounts attributable to Harsco
Corporation common stockholders: |
|
|
|
|
Income (loss) from continuing operations,
net of tax |
$ (50,470) |
$ 39,971 |
$ 10,885 |
$ 133,838 |
Loss from discontinued
operations, net of tax |
(652) |
(576) |
(4,131) |
(15,061) |
Net income (loss)
attributable to Harsco Corporation common
stockholders |
$ (51,122) |
$ 39,395 |
$ 6,754 |
$ 118,777 |
|
|
|
|
|
Weighted-average shares of common stock
outstanding |
80,598 |
80,325 |
80,569 |
80,295 |
Basic earnings per common share attributable
to Harsco Corporation common stockholders: |
|
|
|
|
Continuing operations |
$ (0.63) |
$ 0.50 |
$ 0.14 |
$ 1.67 |
Discontinued
operations |
(0.01) |
(0.01) |
(0.05) |
(0.19) |
Basic earnings per share
attributable to Harsco Corporation common
stockholders |
$ (0.63) (a) |
$ 0.49 |
$ 0.08 (a) |
$ 1.48 |
|
|
|
|
|
Diluted weighted-average shares of common
stock outstanding |
80,804 |
80,674 |
80,761 |
80,586 |
Diluted earnings per common share
attributable to Harsco Corporation common stockholders: |
|
|
|
|
Continuing operations |
$ (0.62) |
$ 0.50 |
$ 0.13 |
$ 1.66 |
Discontinued
operations |
(0.01) |
(0.01) |
(0.05) |
(0.19) |
Diluted earnings per share
attributable to Harsco Corporation common
stockholders |
$ (0.63) |
$ 0.49 |
$ 0.08 |
$ 1.47 |
(a) Does not total due to
rounding. |
|
|
|
|
|
|
|
|
|
|
HARSCO CORPORATION
CONSOLIDATED BALANCE SHEETS (Unaudited) |
|
|
(In
thousands) |
December 31
2010 |
December 31
2009 |
ASSETS |
|
|
Current assets: |
|
|
Cash and cash equivalents |
$ 124,238 |
$ 94,184 |
Trade accounts receivable, net |
585,301 |
598,318 |
Other receivables |
29,299 |
30,865 |
Inventories |
271,617 |
291,174 |
Other current assets |
144,491 |
154,797 |
Total current
assets |
1,154,946 |
1,169,338 |
Property, plant and equipment, net |
1,366,973 |
1,510,801 |
Goodwill |
690,787 |
699,041 |
Intangible assets, net |
120,959 |
150,746 |
Other assets |
135,555 |
109,314 |
Total
assets |
$ 3,469,220 |
$ 3,639,240 |
LIABILITIES |
|
|
Current liabilities: |
|
|
Short-term borrowings |
$ 31,197 |
$ 57,380 |
Current maturities of long-term debt |
4,011 |
25,813 |
Accounts payable |
261,509 |
215,504 |
Accrued compensation |
83,928 |
67,652 |
Income taxes payable |
9,718 |
5,931 |
Dividends payable |
16,505 |
16,473 |
Insurance liabilities |
25,844 |
25,533 |
Advances on contracts |
128,794 |
149,413 |
Other current
liabilities |
206,358 |
187,403 |
Total current
liabilities |
767,864 |
751,102 |
Long-term debt |
849,724 |
901,734 |
Deferred income taxes |
35,642 |
90,993 |
Insurance liabilities |
62,202 |
61,660 |
Retirement plan liabilities |
223,777 |
250,075 |
Other liabilities |
61,866 |
73,842 |
Total
liabilities |
2,001,075 |
2,129,406 |
EQUITY |
|
|
Harsco Corporation stockholders'
equity: |
|
|
Common stock |
139,514 |
139,234 |
Additional paid-in capital |
141,298 |
137,746 |
Accumulated other comprehensive loss |
(185,932) |
(201,684) |
Retained earnings |
2,073,920 |
2,133,297 |
Treasury stock |
(737,106) |
(735,016) |
Total Harsco Corporation
stockholders' equity |
1,431,694 |
1,473,577 |
Noncontrolling
interests |
36,451 |
36,257 |
Total
equity |
1,468,145 |
1,509,834 |
Total liabilities
and equity |
$ 3,469,220 |
$ 3,639,240 |
HARSCO
CORPORATION CONSOLIDATED STATEMENTS OF CASH
FLOWS (Unaudited) |
|
Twelve Months
Ended December 31 |
(In thousands) |
2010 |
2009 |
|
|
|
Cash flows from operating
activities: |
|
|
Net income |
$ 12,459 |
$ 125,772 |
Adjustments to reconcile net income to
net cash provided (used) by operating activities: |
|
|
Depreciation |
279,234 |
282,976 |
Amortization |
36,005 |
28,555 |
Equity in income of unconsolidated
entities, net |
(390) |
(504) |
Dividends or distributions from
unconsolidated entities |
176 |
410 |
Loss on disposal of discontinued
business |
7,249 |
21,907 |
Harsco Infrastructure Segment
restructuring plan |
72,975 |
-- |
Other, net |
(20,629) |
(15,762) |
Changes in assets and liabilities, net of
acquisitions and dispositions of businesses: |
|
|
Accounts receivable |
4,395 |
111,207 |
Inventories |
12,599 |
35,798 |
Accounts payable |
36,529 |
(54,701) |
Accrued interest payable |
(2,615) |
(1,305) |
Accrued compensation |
16,305 |
(23,402) |
Income taxes |
(18,480) |
(36,692) |
Advances on contracts |
(20,822) |
4,242 |
Other assets and
liabilities |
(13,563) |
(44,043) |
|
|
|
Net cash provided
by operating activities |
401,427 |
434,458 |
|
|
|
Cash flows from investing
activities: |
|
|
Purchases of property, plant and
equipment |
(192,348) |
(165,320) |
Purchases of businesses, net of cash
acquired |
(27,643) |
(103,241) |
Proceeds from sales of assets |
22,663 |
2,115 |
Other investing
activities |
(4,695) |
(2,914) |
|
|
|
Net cash used by
investing activities |
(202,023) |
(269,360) |
|
|
|
Cash flows from financing
activities: |
|
|
Short-term borrowings, net |
(25,706) |
(79,670) |
Current maturities and long-term
debt: |
|
|
Additions |
747,213 |
482,493 |
Reductions |
(821,038) |
(487,171) |
Cash dividends paid on common stock |
(65,976) |
(63,813) |
Dividends paid to noncontrolling
interests |
(5,850) |
(3,487) |
Purchase of noncontrolling interest |
(1,159) |
(13,057) |
Contributions of equity from
noncontrolling interests |
698 |
5,332 |
Common stock issued-options |
997 |
995 |
Other financing
activities |
(700) |
(5,705) |
|
|
|
Net cash used by
financing activities |
(171,521) |
(164,083) |
|
|
|
Effect of exchange rate changes on
cash |
2,171 |
1,833 |
|
|
|
Net increase in cash and cash
equivalents |
30,054 |
2,848 |
|
|
|
Cash and cash equivalents at beginning
of period |
94,184 |
91,336 |
|
|
|
Cash and cash equivalents at end
of period |
$ 124,238 |
$ 94,184 |
|
|
HARSCO
CORPORATION |
REVIEW OF OPERATIONS BY
SEGMENT (Unaudited) |
|
|
Three Months Ended
December 31, 2010 |
Three Months Ended
December 31, 2009 |
(In thousands) |
Sales |
Operating
Income (Loss) |
Sales |
Operating Income
(Loss) |
|
|
|
|
|
Harsco Infrastructure |
$ 264,956 |
$ (98,879) |
$ 287,238 |
$ 2,170 |
Harsco Metals & Minerals (a) |
371,730 |
23,902 |
356,067 |
25,690 |
Harsco Rail |
60,858 |
9,694 |
74,638 |
12,538 |
Harsco Industrial (a) |
59,807 |
10,432 |
54,488 |
13,991 |
General Corporate |
-- |
(895) |
60 |
313 |
Consolidated Totals |
$ 757,351 |
$ (55,746) |
$ 772,491 |
$ 54,702 |
|
(a) Segment information
for prior periods has been reclassified to conform with the current
presentation. Previously, an All Other Category was comprised
of the Harsco Minerals and Harsco Industrial operating
segments. The Harsco Minerals operating segment has been
combined with the Harsco Metals Segment to form the Harsco Metals
& Minerals Segment. The Harsco Industrial operating
segment now forms a separate segment for financial reporting. |
|
|
|
|
Twelve Months Ended
December 31, 2010 |
Twelve Months Ended
December 31, 2009 |
(In thousands) |
Sales |
Operating
Income (Loss) |
Sales |
Operating
Income (Loss) |
|
|
|
|
|
Harsco Infrastructure |
$ 1,031,807 |
$ (145,346) |
$ 1,159,200 |
$ 68,437 |
Harsco Metals & Minerals (a) |
1,461,531 |
117,915 |
1,257,098 |
43,303 |
Harsco Rail |
313,262 |
66,124 |
306,016 |
56,542 |
Harsco Industrial (a) |
231,898 |
42,871 |
268,023 |
55,084 |
General
Corporate |
180 |
(3,133) |
240 |
(4,710) |
Consolidated Totals |
$ 3,038,678 |
$ 78,431 |
$ 2,990,577 |
$ 218,656 |
|
(a) Segment information
for prior periods has been reclassified to conform with the current
presentation. Previously, an All Other Category was comprised
of the Harsco Minerals and Harsco Industrial operating
segments. The Harsco Minerals operating segment has been
combined with the Harsco Metals Segment to form the Harsco Metals
& Minerals Segment. The Harsco Industrial operating
segment now forms a separate segment for financial reporting. |
|
|
|
|
|
|
HARSCO CORPORATION
FREE CASH FLOW (Unaudited) |
|
|
|
Twelve Months
Ended December 31 |
(In thousands) |
2010 |
2009 |
2008 |
|
|
|
|
Net cash provided by operating
activities |
$ 401,427 |
$ 434,458 |
$ 574,276 |
Purchases of property, plant and
equipment |
(192,348) |
(165,320) |
(457,617) |
Free cash flow |
$ 209,079 |
$ 269,138 |
$ 116,659 |
Free Cash Flow is a non-GAAP financial measure. The
Company's Management believes that this measure is meaningful to
investors because management reviews cash flows generated from
operations after taking into consideration capital expenditures due
to the fact that these expenditures are considered necessary to
maintain and expand the Company's asset base and are expected to
generate future cash flows from operations. It is important
to note that Free Cash Flow does not represent the residual cash
flow available for discretionary expenditures since other
non-discretionary expenditures, such as mandatory debt service
requirements, are not deducted from the measure.
|
HARSCO
CORPORATION |
REVIEW OF OPERATING
INCOME BY SEGMENT |
EXCLUDING RESTRUCTURING
CHARGE (a) – Addendum (Unaudited) |
|
|
Three Months Ended December 31,
2010 |
Operating Income
(Loss) |
(In thousands) |
As
Reported |
Restructuring
Charge |
Excluding
Restructuring Charge |
Harsco Infrastructure |
$ (98,879) |
$ 84,440 |
$ (14,439) |
Harsco Metals & Minerals |
23,902 |
-- |
23,902 |
Harsco Rail |
9,694 |
-- |
9,694 |
Harsco Industrial |
10,432 |
-- |
10,432 |
General Corporate |
(895) |
-- |
(895) |
Consolidated Totals |
$ (55,746) |
$ 84,440 |
$ 28,694 |
|
|
|
|
|
|
|
|
Twelve Months Ended December 31,
2010 |
Operating Income
(Loss) |
(In thousands) |
As
Reported |
Restructuring
Charge |
Excluding Restructuring
Charge |
Harsco Infrastructure |
$ (145,346) |
$ 84,440 |
$ (60,906) |
Harsco Metals & Minerals |
117,915 |
-- |
117,915 |
Harsco Rail |
66,124 |
-- |
66,124 |
Harsco Industrial |
42,871 |
-- |
42,871 |
General Corporate |
(3,133) |
-- |
(3,133) |
Consolidated Totals |
$ 78,431 |
$ 84,440 |
$ 162,871 |
|
(a) The Company's
management believes operating income excluding the restructuring
charge is useful to investors because it provides an overall
understanding of the Company's historical financial performance and
future prospects. Exclusion of these items permits evaluation
and comparison of results for the Company's core business
operations, and it is on this basis that management internally
assesses the Company's performance. |
|
|
HARSCO
CORPORATION |
RECONCILIATION OF INCOME
(LOSS) FROM CONTINUING OPERATIONS (GAAP BASIS) TO INCOME FROM
CONTINUING OPERATIONS, EXCLUDING RESTRUCTURING CHARGE (a)
(Unaudited) |
(In
thousands) |
|
|
Three Months Ended
December 31 |
Twelve Months Ended
December 31 |
|
2010 |
2010 |
|
|
|
Income (loss) from continuing
operations (GAAP basis) |
$ (49,210) |
$ 16,590 |
|
|
|
Restructuring charge: |
|
|
|
|
|
Severance and other employee related
costs |
(21,075) |
(21,075) |
Operating exit costs |
(20,433) |
(20,433) |
Product line rationalization |
(34,302) |
(34,302) |
Asset impairment |
(8,500) |
(8,500) |
Other |
(130) |
(130) |
Restructuring charge, before tax |
(84,440) |
(84,440) |
Tax benefit |
21,806 |
21,806 |
Restructuring charge, after tax |
(62,634) |
(62,634) |
|
|
|
Income from continuing
operations, excluding restructuring charge |
$ 13,424 |
$ 79,224 |
|
(a) The Company's
management believes operating income excluding the restructuring
charge is useful to investors because it provides an overall
understanding of the Company's historical financial performance and
future prospects. Exclusion of these items permits evaluation
and comparison of results for the Company's core business
operations, and it is on this basis that management internally
assesses the Company's performance. |
|
|
HARSCO
CORPORATION |
REVIEW OF OPERATIONS BY
SEGMENT (Unaudited) |
2010, 2009 AND 2008
RECLASSIFIED TO SEPARATELY PRESENT HARSCO METALS & MINERALS AND
HARSCO INDUSTRIAL |
(In
thousands) |
|
|
|
|
|
Three Months
Ended March 31, 2010 |
Three Months Ended
March 31, 2009 |
Three Months Ended
March 31, 2008 |
|
Sales |
Operating Income
(Loss) |
Sales |
Operating
Income (Loss) |
Sales |
Operating
Income (Loss) |
|
|
|
|
|
|
|
Harsco Infrastructure |
$ 250,629 |
$ (19,273) |
$ 283,746 |
$ 18,837 |
$ 378,824 |
$ 37,838 |
Harsco Metals & Minerals |
344,262 |
19,284 |
271,613 |
367 |
465,664 |
39,700 |
Harsco Rail |
95,402 |
20,414 |
59,840 |
7,224 |
59,118 |
9,087 |
Harsco Industrial |
52,053 |
8,378 |
81,631 |
13,035 |
84,124 |
14,362 |
General Corporate |
60 |
(564) |
60 |
(2,292) |
60 |
(1,607) |
Consolidated Totals |
$ 742,406 |
$ 28,239 |
$ 696,890 |
$ 37,171 |
$ 987,790 |
$ 99,380 |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended June 30, 2010 |
Three Months Ended June
30, 2009 |
Three Months Ended June
30, 2008 |
|
Sales |
Operating Income
(Loss) |
Sales |
Operating
Income (Loss) |
Sales |
Operating
Income (Loss) |
|
|
|
|
|
|
|
Harsco Infrastructure |
$ 262,653 |
$ (13,551) |
$ 308,765 |
$ 24,928 |
$ 429,176 |
$ 58,134 |
Harsco Metals & Minerals |
376,188 |
40,702 |
300,877 |
9,861 |
506,928 |
59,857 |
Harsco Rail |
86,327 |
21,614 |
94,301 |
21,996 |
69,374 |
10,644 |
Harsco Industrial |
61,313 |
13,716 |
72,972 |
15,022 |
94,050 |
18,649 |
General Corporate |
40 |
(614) |
60 |
(1,448) |
60 |
(1,445) |
Consolidated Totals |
$ 786,521 |
$ 61,867 |
$ 776,975 |
$ 70,359 |
$ 1,099,588 |
$ 145,839 |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended September 30, 2010 |
Three Months Ended
September 30, 2009 |
Three Months Ended
September 30, 2008 |
|
Sales |
Operating
Income (Loss) |
Sales |
Operating
Income (Loss) |
Sales |
Operating
Income (Loss) |
|
|
|
|
|
|
|
Harsco Infrastructure |
$ 253,569 |
$ (13,643) |
$ 279,450 |
$ 22,503 |
$ 393,292 |
$ 59,998 |
Harsco Metals & Minerals |
369,351 |
34,026 |
328,542 |
7,384 |
480,843 |
49,851 |
Harsco Rail |
70,675 |
14,401 |
77,237 |
14,785 |
70,062 |
8,684 |
Harsco Industrial |
58,726 |
10,345 |
58,932 |
13,035 |
100,640 |
16,727 |
General Corporate |
80 |
(1,059) |
60 |
(1,283) |
60 |
(1,387) |
Consolidated Totals |
$ 752,401 |
$ 44,070 |
$ 744,221 |
$ 56,424 |
$ 1,044,897 |
$ 133,873 |
|
|
|
|
|
|
|
|
HARSCO
CORPORATION |
REVIEW OF OPERATIONS BY
SEGMENT (Unaudited) |
2010, 2009 AND 2008
RECLASSIFIED TO SEPARATELY PRESENT HARSCO METALS & MINERALS AND
HARSCO INDUSTRIAL |
(In
thousands) |
|
|
|
|
|
Three Months
Ended December 31, 2010 |
Three Months Ended
December 31, 2009 |
Three Months Ended
December 31, 2008 |
|
Sales |
Operating Income
(Loss) |
Sales |
Operating
Income (Loss) |
Sales |
Operating
Income (Loss) |
|
|
|
|
|
|
|
Harsco Infrastructure |
$ 264,956 |
$ (98,879) |
$ 287,238 |
$ 2,170 |
$ 338,966 |
$ 29,412 |
Harsco Metals & Minerals |
371,730 |
23,902 |
356,067 |
25,690 |
325,542 |
(11,798) |
Harsco Rail |
60,858 |
9,694 |
74,638 |
12,538 |
79,042 |
7,991 |
Harsco Industrial |
59,807 |
10,432 |
54,488 |
13,991 |
91,937 |
12,513 |
General Corporate |
-- |
(895) |
60 |
313 |
60 |
(5,221) |
Consolidated Totals |
$ 757,351 |
$ (55,746) |
$ 772,491 |
$ 54,702 |
$ 835,547 |
$ 32,897 |
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months
Ended December 31, 2010 (a) |
Twelve Months Ended
December 31, 2009 (a) |
Twelve Months Ended
December 31, 2008 (a) |
|
Sales |
Operating Income
(Loss) |
Sales |
Operating
Income (Loss) |
Sales |
Operating
Income (Loss) |
|
|
|
|
|
|
|
Harsco Infrastructure |
$ 1,031,807 |
$ (145,346) |
$ 1,159,200 |
$ 68,437 |
$ 1,540,258 |
$ 185,382 |
Harsco Metals & Minerals |
1,461,531 |
117,915 |
1,257,098 |
43,303 |
1,778,977 |
137,609 |
Harsco Rail |
313,262 |
66,124 |
306,016 |
56,542 |
277,595 |
36,406 |
Harsco Industrial |
231,898 |
42,871 |
268,023 |
55,084 |
370,752 |
62,251 |
General Corporate |
180 |
(3,133) |
240 |
(4,710) |
240 |
(9,660) |
Consolidated Totals |
$ 3,038,678 |
$ 78,431 |
$ 2,990,577 |
$ 218,656 |
$ 3,967,822 |
$ 411,988 |
|
(a) The aggregation of
three-month amounts may not total to twelve-month amounts due to
rounding. |
CONTACT: Investor Contact
Eugene M. Truett
717.975.5677
etruett@harsco.com
Media Contact
Kenneth D. Julian
717.730.3683
kjulian@harsco.com
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