HOUSTON, May 4, 2011 /PRNewswire/ -- Kraton Performance
Polymers, Inc. (NYSE: KRA), a leading global producer of styrenic
block copolymers, announces financial results for the quarter ended
March 31, 2011.
2011 FIRST QUARTER HIGHLIGHTS
- Sales volume increased 12% year-on-year to 81 kilotons
- Sales revenue increased 26% year-on-year to $345 million
- Net income was $22 million in the
first quarter 2011, compared to $20
million in the first quarter 2010
- GAAP earnings were $0.68 per
fully-diluted share in the first quarter 2011
- Restructuring and related charges, charges associated with
evaluating acquisition transactions, costs associated with debt
refinancing and costs associated with the secondary offering in the
first quarter were approximately $10
million or $0.30 per
share
- Adjusted EBITDA(1) ( 2) was $56
million or 16% of sales revenue
- LIFO to FIFO income (3) was $21
million, as compared to $7
million income in the first quarter 2010
"Kraton continued to deliver solid operational results in the
first quarter of 2011, with sales volume up 12% year-on-year and
sales revenue up 26% compared to the first quarter 2010. The
increase in sales revenue reflects the impact of price increases
implemented during the fourth quarter 2010 in response to rising
raw material costs and other manufacturing inputs as well as higher
sales volume compared to the first quarter 2010," said Kevin M. Fogarty, Kraton's President and Chief
Executive Officer. "The trend of higher prices for many of
our key raw materials continued throughout the first quarter, and
in response we announced a number of additional price increases,
many of which have been implemented already in the second quarter
2011," added Fogarty. "During the quarter we continued our
focus on expanding our innovation volumes and on moving new
innovation projects toward commercialization. We are
encouraged by the progress in our innovation programs, and on a
trailing twelve month basis at March 31,
2011, our Vitality Index was 14%. We also completed a
highly successful secondary offering at quarter end, which
completed the sale of all remaining shares held by TPG Capital,
L.P. and J.P. Morgan Partners, LLC. As a result, we enter a
new chapter in Kraton's history."
|
|
|
|
|
|
Three Months
Ended March 31,
|
|
(US $ in thousands, except per
share amounts)
|
|
2011
|
|
2010
|
|
Sales revenue
|
|
$ 344,828
|
|
$ 272,732
|
|
Adjusted EBITDA(1) (
2)
|
|
$ 56,018
|
|
$ 42,622
|
|
Net income
|
|
$ 21,877
|
|
$ 19,795
|
|
Net income per diluted
share(4)
|
|
$ 0.68
|
|
$ 0.64
|
|
Net cash used in operating
activities
|
|
$44,137
|
|
$ 72,836
|
|
|
|
|
|
|
(1) A reconciliation of Adjusted EBITDA to Net Income is
included in the accompanying financial tables.
(2) Adjusted EBITDA is EBITDA excluding restructuring and
related charges, non-cash compensation expenses and loss on the
extinguishment of debt.
(3) The spread between the first-in, first-out (FIFO)
basis of accounting and the last-in, first-out (LIFO) basis of
accounting resulted in a decrease in cost of goods sold of
approximately $21.0 million and
$7.3 million for the three months
ended March 31, 2011 and 2010,
respectively.
(4) First quarter 2011 net income includes restructuring
and related charges, charges associated with evaluating acquisition
transactions, costs associated with debt refinancing and costs
associated with the secondary offering of approximately
$10 million or $0.30 per share. First quarter 2010 net
income includes a benefit of approximately $1 million or $0.02
per share associated with restructuring activities.
First Quarter 2011 versus First Quarter 2010 Results
Sales revenue in the first quarter 2011 was $345 million, an increase of approximately 26%
compared to the first quarter 2010. The increase in sales
revenue compared to the first quarter 2010 was primarily the result
of higher sales volumes and the impact of price increases
implemented in response to rising raw material costs and other
factors. Sales volume in the first quarter 2011 was 81 kilotons, up
12% compared to the first quarter 2010.
Adjusted EBITDA in the first quarter 2011 was $56 million, or 16% of revenue, compared to
$43 million, or 16% of revenue in the
first quarter 2010. The spread between the LIFO and FIFO
basis of accounting had a positive impact on first quarter 2011
Adjusted EBITDA of $21 million and a
positive impact of $7 million in the
first quarter 2010.
First quarter 2011 net income was $22
million or $0.68 per diluted
share, compared to first quarter 2010 net income of $20 million or $0.64 per diluted share. First quarter 2011
earnings per share were negatively impacted by approximately
$0.30 per share associated with
restructuring and related charges, charges associated with
evaluating acquisition transactions, costs associated with debt
refinancing and costs associated with the secondary offering. First
quarter 2010 net income includes a benefit of approximately
$1 million or $0.02 per share associated with restructuring
activities.
Cash Flow
During the first quarter 2011, net cash used in operating
activities was $44 million, compared
to net cash used in operating activities of $73 million in the first quarter of 2010.
Net capital expenditures in the first quarter 2011 were
$17 million compared to $8 million in the first quarter 2010.
END USE MARKET INFORMATION
Revenue in our Advanced Materials end use market
increased $19 million or
approximately 21% to $111 million in
the first quarter 2011 compared to the first quarter 2010.
"Revenue in our Advanced Materials end use increased in all
markets, including HSBC-led growth in emerging markets," said
Fogarty. "We continued to see positive momentum for
innovation product sales, which include personal care applications
such as diapers and adult incontinence products, and in PVC-free
alternatives for wire and cable applications such as computer data
and power cords and for medical applications such as IV bags and
tubing."
Revenue in our Adhesives, Sealants and Coatings end use
market increased $18 million or
approximately 19% to $110 million in
the first quarter 2011 compared to the first quarter 2010.
"Revenue growth in our Adhesives, Sealants and Coatings end use
market was led by Europe and
North America, and was primarily
due to higher pricing," said Fogarty. "European sales
increases were driven by the non-woven and industrial applications,
as well as by innovation sales in health and beauty applications.
North American sales were driven by specialty tape and
printing plate applications."
Revenue in our Paving and Roofing end use market
increased $33 million or
approximately 53% to $94 million in
the first quarter 2011 compared to the first quarter 2010.
"Sales growth was led by Europe, where we saw increased pricing and
volumes in both paving and roofing markets. In North America,
sales growth was driven by higher pricing in both the paving and
roofing markets, and by higher volume in the paving market.
During the quarter we also extended our sales into emerging
markets such as India and
Russia," said Fogarty. "We
estimate that North American and European sales volumes in the
first quarter included approximately 7 kilotons associated with
accelerated purchasing, above the typical level of pre-season
inventory accumulation, as customers built inventories in advance
of expected price increases."
Revenue in our Emerging Businesses end use market
increased $6 million or approximately
47% to $20 million in the first
quarter 2011 compared to the first quarter 2010.
"The growth in revenue in our Emerging Business end use reflects
continued volume growth in our Cariflex™ isoprene rubber latex
business in applications such as surgical gloves and condoms, as
well as Cariflex solid isoprene rubber in medical and coatings
applications," said Fogarty. "We are also pleased to announce
that we have completed the isoprene rubber latex expansion project
at our facility in Paulinia, Brazil."
FIRST QUARTER 2011 DEVELOPMENTS
On April 6, 2011 Kraton announced
the closing of a secondary offering entailing the sale of 9,988,072
shares of Kraton's common stock held by affiliates of TPG Capital,
L.P. ("TPG") and J.P. Morgan Partners, LLC ("JPMP"), which
represented all of the shares of Kraton's common stock held by TPG
and JPMP, at a price to the public of $37.75 per share. Prior to the sale, TPG owned
approximately 18.80% of our outstanding common stock, and JPMP
owned approximately 12.53%. Kraton did not receive any proceeds
from the secondary offering.
On February 11, 2011 Kraton issued
$250 million in 6.75% senior
unsecured notes due 2019. In conjunction with the notes
offering, Kraton entered into a new senior secured credit facility
with a syndicate of banks, comprised of a $150 million term loan facility and a
$200 million revolving credit
facility. Proceeds from the 6.75% notes offering and the new
senior secured term facility were used to retire the company's
outstanding 8.125% senior subordinated notes due 2014 and amounts
outstanding under the company's previous bank term loan facility.
Kraton continued its process of evaluating options for the 30
kiloton hydrogenated styrenic block copolymer plant it proposes to
build in Asia. As this
process includes an in-depth review of significant project
variables such as proposed transaction structure, commercial terms,
operating agreements and feedstock availability as well as an
analysis of the impact these criteria have on overall project
economics, the company now expects to be in a position to
communicate site location in the second half of 2011.
Operations at Kraton's Kashima, Japan, chemical complex were shut down on
March 11, 2011, as part of a complex
wide emergency procedure in response to the recent earthquakes.
Although the facility was not damaged, it has been confirmed that
there has been damage to the broader infrastructure at the Kashima
Petrochemical Complex as a result of the earthquake and tsunami.
Operations at the facility remain suspended due to a lack of
monomers and utilities. Currently, it is impossible to give an
accurate estimate of when the facility will be back in operation.
The company continues to monitor the situation closely and is
working with its joint venture partner and other business
counterparties to expedite returning the facility to normal
operations. At the present time, the company is able to meet its
customers' forecasted demand from existing inventories and the
company has initiated contingency plans to provide its customers
with products from its other global manufacturing sites to mitigate
any supply disruptions.
OUTLOOK
"During the first quarter of 2011, prices for our key raw
materials increased and we currently expect this trend to continue
as evidenced by the cumulative April and
May North American butadiene contract price increase of
$0.38 per pound or 36%," said
Fogarty. "With respect to sales volume, we believe there was
approximately 9 kilotons of first quarter 2011 sales volume
attributable to advanced purchases, particularly in our Paving and
Roofing end use, as customers pulled volume, primarily from the
second quarter, into the first quarter. As such, we currently
anticipate that our second quarter 2011 sales volume will be
between 84 and 87 kilotons, within the range of historical volume
progression from the first quarter to the second quarter, after
taking into account the 9 kilotons of advanced purchasing in the
first quarter 2011."
USE OF NON-GAAP FINANCIAL MEASURES
This earnings release includes the use of both GAAP (generally
accepted accounting principles) and non-GAAP financial measures.
The non-GAAP financial measures are EBITDA and Adjusted
EBITDA. In each case the most directly comparable GAAP financial
measure is net income. A table included in this earnings
release reconciles these non-GAAP financial measures with the most
directly comparable GAAP financial measure.
We consider EBITDA and Adjusted EBITDA important supplemental
measures of our performance and believe they are frequently used by
investors and other interested parties in the evaluation of
companies in our industry. EBITDA and Adjusted EBITDA have
limitations as analytical tools, and you should not consider them
in isolation, or as a substitute for analysis of our results under
GAAP in the United States.
EBITDA and Adjusted EBITDA presented in this earnings release
may differ from EBITDA amounts calculated by us under our debt
instruments.
CONFERENCE CALL AND WEBCAST INFORMATION
Kraton has scheduled a conference call on Thursday May 5, 2011 at 9:00 a.m. (Eastern Time) to discuss first quarter
2011 financial results. Kraton invites you to listen to the
conference call, which will be broadcast live over the internet at
www.kraton.com, by selecting the "Investor Relations" link at the
top of the home page and then selecting "Events" from the Investor
Relations menu on the left side of the Investor Relations page.
You may also listen to the conference call by telephone by
contacting the conference call operator 5 to 10 minutes prior to
the scheduled start time and asking for the "Kraton Conference Call
– Passcode: Earnings Call." U.S./Canada dial-in #: 888-577-8992.
International dial-in #: 312-470-7060.
For those unable to listen to the live call, a replay will be
available beginning at approximately 11:00
a.m. (Eastern Time) on May 5,
2011 through 11:59 p.m. Eastern
Time on May 19, 2011. To hear
a replay of the call over the Internet, access Kraton's Website at
www.kraton.com by selecting the "Investor Relations" link at the
top of the home page and then selecting "Events" from the Investor
Relations menu on the left side of the Investor Relations page. To
hear a telephonic replay of the call, dial 866-454-1413 and
International callers dial 203-369-1236.
ABOUT KRATON
Kraton Performance Polymers, Inc., through its operating
subsidiary Kraton Polymers LLC and its subsidiaries (collectively,
"Kraton"), is a leading global producer of engineered polymers and
one of the world's largest producers of styrenic block copolymers
(SBCs), a family of products whose chemistry was pioneered by
Kraton almost 50 years ago. Kraton's polymers are used in a wide
range of applications, including adhesives, coatings, consumer and
personal care products, sealants and lubricants, and medical,
packaging, automotive, paving, roofing and footwear products. The
company offers approximately 800 products to more than 700
customers in over 60 countries worldwide, and is the only SBC
producer with manufacturing and service capabilities on four
continents. We manufacture products at five plants globally,
including our flagship plant in Belpre,
Ohio, the most diversified SBC plant in the world, as well
as plants in Germany, France, Brazil and Japan. The plant in Japan is operated by an unconsolidated
manufacturing joint venture. For more information on the company,
please visit www.kraton.com.
Kraton, the Kraton logo and design, and the "Giving Innovators
their Edge" tagline are all trademarks of Kraton Polymers LLC.
Forward Looking Statements
This press release includes forward-looking statements that
reflect our plans, beliefs, expectations and current views with
respect to, among other things, future events and financial
performance. Forward-looking statements are often characterized by
the use of words such as "outlook", "believes," "estimates,"
"expects," "projects," "may," "intends," "plans" or "anticipates,"
or by discussions of strategy, plans or intentions.
In this press release, forward-looking information relates to,
pricing trends, expected second quarter financial results, expected
volumes, cost savings, production rates and other similar
matters. All forward-looking statements in this press release
are made based on management's current expectations and estimates,
which involve known and unknown risks, uncertainties and other
important factors that could cause actual results to differ
materially from those expressed in forward-looking statements.
These risks and uncertainties are more fully described in "Part I.
Item 1A. Risk Factors" contained in our Annual Report on 10-K, as
filed with the Securities and Exchange Commission and as
subsequently updated in our Quarterly Reports on Form 10-Q, and
include the following risk factors: conditions in the global
economy and capital markets; our reliance on LyondellBasell
Industries for the provision of significant operating and other
services ; the failure of our raw materials suppliers to perform
their obligations under long-term supply agreements, or our
inability to replace or renew these agreements when they expire;
limitations in the availability of raw materials we need to produce
our products in the amounts or at the prices necessary for us to
effectively and profitably operate our business; competition in our
end-use markets, from other producers of SBCs and from producers of
products that can be substituted for our products; our ability to
produce and commercialize technological innovations; our ability to
protect our intellectual property, on which our business is
substantially dependent; infringement of our products on the
intellectual property rights of others; seasonality in our Paving
and Roofing business; financial and operating constraints related
to our substantial level of indebtedness; the inherently hazardous
nature of chemical manufacturing; product liability claims and
other lawsuits arising from environmental damage or personal
injuries associated with chemical manufacturing; political and
economic risks in the various countries in which we operate;
health, safety and environmental laws, including laws that govern
our employees' exposure to chemicals deemed harmful to humans;
regulation of our customers, which could affect the demand for our
products or result in increased compliance costs; customs,
international trade, export control, antitrust, zoning and
occupancy and labor and employment laws that could require us to
modify our current business practices and incur increased costs;
fluctuations in currency exchange rates; our relationship with our
employees; loss of key personnel or our inability to attract and
retain new qualified personnel; the fact that we typically do not
enter into long-term contracts with our customers; a decrease in
the fair value of our pension assets, which could require us to
materially increase future funding of the pension plan; future
sales of our shares could adversely affect the market price of our
common stock; Delaware law and
some provisions of our organizational documents make a takeover of
our company more difficult; and other risks, factors and
uncertainties described in this press release and our other
reports and documents; and other factors of which we are currently
unaware or deem immaterial. Readers are cautioned not to
place undue reliance on forward-looking statements. We assume no
obligation to update such information in light of new information
or future events. Further information concerning issues that
could materially affect financial performance related to
forward-looking statements can be found in Kraton's periodic
filings with the Securities and Exchange Commission.
KRATON
PERFORMANCE POLYMERS, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In
thousands, except per share data)
|
|
|
|
|
|
|
Three months
ended March 31,
|
|
|
2011
|
2010
|
|
Sales Revenue
|
$ 344,828
|
$ 272,732
|
|
Cost of Goods Sold
|
257,977
|
203,605
|
|
|
|
|
|
Gross Profit
|
86,851
|
69,127
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
Research and
development
|
6,602
|
5,984
|
|
Selling, general and
administrative
|
27,171
|
22,062
|
|
Depreciation and
amortization of identifiable intangibles
|
14,626
|
11,046
|
|
|
|
|
|
Total operating
expenses
|
48,399
|
39,092
|
|
|
|
|
|
Loss on Extinguishment of
Debt
|
2,985
|
—
|
|
Earnings of Unconsolidated Joint
Venture
|
141
|
74
|
|
Interest Expense, Net
|
11,181
|
6,064
|
|
|
|
|
|
Income Before Income
Taxes
|
24,427
|
24,045
|
|
Income Tax Expense
|
2,550
|
4,250
|
|
|
|
|
|
Net Income
|
$ 21,877
|
$ 19,795
|
|
|
|
|
|
Earnings per common
share
|
|
|
|
Basic
|
$ 0.69
|
$ 0.64
|
|
Diluted
|
$ 0.68
|
$ 0.64
|
|
|
|
|
|
Weighted average common shares
outstanding
|
|
|
|
Basic
|
31,609
|
30,539
|
|
Diluted
|
32,197
|
30,728
|
|
|
|
|
|
|
KRATON
PERFORMANCE POLYMERS, INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In
thousands, except par value)
|
|
|
|
|
|
|
March 31,
2011
|
December 31,
2010
|
|
ASSETS
|
|
|
|
|
|
|
|
Current Assets
|
|
|
|
Cash and cash
equivalents
|
$ 36,031
|
$ 92,750
|
|
Receivables, net of
allowances of $1,147 and $947
|
177,760
|
136,132
|
|
Inventories of products,
net
|
364,257
|
325,120
|
|
Inventories of materials
and supplies, net
|
9,829
|
9,631
|
|
Other current
assets
|
46,699
|
38,749
|
|
|
|
|
|
Total current
assets
|
634,576
|
602,382
|
|
|
|
|
|
Property, plant and equipment,
less accumulated depreciation of $270,908 and $252,387
|
381,209
|
365,366
|
|
Identifiable intangible assets,
less accumulated amortization of $52,268 and $50,123
|
68,449
|
70,461
|
|
Investment in unconsolidated
joint venture
|
13,204
|
13,589
|
|
Deferred financing costs
|
12,838
|
3,172
|
|
Other long-term assets
|
26,885
|
25,753
|
|
|
|
|
|
Total
Assets
|
$ 1,137,161
|
$ 1,080,723
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
|
Current portion of
long-term debt
|
$ 9,375
|
$ 2,304
|
|
Accounts
payable-trade
|
84,054
|
86,699
|
|
Other payables and
accruals
|
43,970
|
60,782
|
|
Deferred income
taxes
|
595
|
595
|
|
Insurance note
payable
|
4,260
|
—
|
|
Due to related
party
|
17,379
|
19,264
|
|
|
|
|
|
Total current
liabilities
|
159,633
|
169,644
|
|
Long-term debt, net of current
portion
|
390,625
|
380,371
|
|
Deferred income taxes
|
14,823
|
14,089
|
|
Long-term liabilities
|
72,987
|
64,242
|
|
|
|
|
|
Total liabilities
|
638,068
|
628,346
|
|
|
|
|
|
|
|
|
|
Stockholders'
Equity
|
|
|
|
Preferred stock, $0.01 par
value; 100,000 shares authorized; none issued
|
|
|
|
Common stock, $0.01 par
value; 500,000 shares authorized; 31,881 shares issued and
outstanding at March 31, 2011; 31,390 shares issued and outstanding
at December 31, 2010
|
319
|
314
|
|
Additional paid in
capital
|
340,913
|
334,457
|
|
Retained earnings
|
118,588
|
96,711
|
|
Accumulated other
comprehensive income
|
39,273
|
20,895
|
|
|
|
|
|
Total stockholders'
equity
|
499,093
|
452,377
|
|
|
|
|
|
Total
Liabilities and Stockholders' Equity
|
$ 1,137,161
|
$ 1,080,723
|
|
|
|
|
|
|
|
|
|
|
KRATON
PERFORMANCE POLYMERS, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In
thousands)
|
|
|
|
|
|
|
Three months
ended March 31,
|
|
|
2011
|
2010
|
|
CASH FLOWS FROM OPERATING
ACTIVITIES
|
|
|
|
Net income
|
$ 21,877
|
$ 19,795
|
|
Adjustments to reconcile
net income to net cash used in operating activities:
|
|
|
|
Depreciation and
amortization of identifiable intangibles
|
14,626
|
11,046
|
|
Amortization of deferred
financing costs
|
4,762
|
518
|
|
Loss on disposal of fixed
assets
|
5
|
3
|
|
Loss on extinguishment of
debt
|
2,985
|
—
|
|
Change in fair value of
interest rate swaps
|
—
|
(450)
|
|
Distributed earnings in
unconsolidated joint venture
|
374
|
328
|
|
Deferred income tax
expense
|
735
|
909
|
|
Share-based
compensation
|
1,294
|
1,332
|
|
Increase
in
|
|
|
|
Accounts receivable
|
(36,792)
|
(38,811)
|
|
Inventories of products,
materials and supplies
|
(31,359)
|
(26,949)
|
|
Other assets
|
(12,626)
|
(18,139)
|
|
Decrease
in
|
|
|
|
Accounts payable-trade,
other payables and accruals, and other long-term
liabilities
|
(8,150)
|
(20,160)
|
|
Due to related
party
|
(1,868)
|
(2,258)
|
|
|
|
|
|
Net cash used in operating
activities
|
(44,137)
|
(72,836)
|
|
|
|
|
|
CASH FLOWS FROM INVESTING
ACTIVITIES
|
|
|
|
Purchase of property,
plant and equipment
|
(16,518)
|
(6,466)
|
|
Purchase of
software
|
(132)
|
(1,188)
|
|
|
|
|
|
Net cash used in investing
activities
|
(16,650)
|
(7,654)
|
|
|
|
|
|
CASH FLOWS FROM FINANCING
ACTIVITIES
|
|
|
|
Proceeds from debt
|
400,000
|
25,000
|
|
Repayment of debt
|
(385,660)
|
(25,576)
|
|
Proceeds from issuance of
common stock
|
—
|
11,197
|
|
Costs associated with the
issuance of common stock
|
—
|
(484)
|
|
Proceeds from the exercise
of stock options
|
5,896
|
—
|
|
Proceeds from insurance
note payable
|
4,734
|
3,201
|
|
Repayment of insurance
note payable
|
(474)
|
—
|
|
Debt issuance costs
|
(14,948)
|
—
|
|
|
|
|
|
Net cash provided by
financing activities
|
9,548
|
13,338
|
|
|
|
|
|
Effect of exchange rate
differences on cash
|
(5,480)
|
9,911
|
|
|
|
|
|
Net decrease in cash and
cash equivalents
|
(56,719)
|
(57,241)
|
|
Cash and
cash equivalents at beginning of period
|
92,750
|
69,291
|
|
|
|
|
|
Cash and
cash equivalents at end of period
|
$ 36,031
|
$ 12,050
|
|
|
|
|
|
Supplemental
Disclosures
|
|
|
|
Cash paid during the
period for income taxes, net of refunds received
|
$ 3,703
|
$ 894
|
|
Cash paid during the
period for interest
|
$ 10,647
|
$ 9,989
|
|
|
|
|
|
|
KRATON
PERFORMANCE POLYMERS, INC.
EBITDA AND
ADJUSTED EBITDA
(In
thousands)
|
|
We reconcile Net Income to
EBITDA and Adjusted EBITDA as follows
|
|
|
|
|
Three months
ended
March 31,
|
|
|
2011
|
2010
|
|
|
(in
thousands)
|
|
Net Income
|
$ 21,877
|
$ 19,795
|
|
Plus
|
|
|
|
Interest expense,
net
|
11,181
|
6,064
|
|
Income tax expense
|
2,550
|
4,250
|
|
Depreciation and
amortization expenses
|
14,626
|
11,046
|
|
|
|
|
|
EBITDA (a)
|
$ 50,234
|
$ 41,155
|
|
|
|
|
|
Add
|
|
|
|
Restructuring and related
costs (b)
|
1,505
|
135
|
|
Other non-cash expense
(c)
|
1,294
|
1,332
|
|
Loss on extinguishment of
debt (d)
|
2,985
|
—
|
|
|
|
|
|
Adjusted EBITDA (a)
|
$ 56,018
|
$ 42,622
|
|
|
|
|
|
|
|
|
|
|
|
(a) EBITDA and Adjusted EBITDA are impacted by the spread
between the FIFO basis of accounting and the LIFO basis of
accounting. The spread between the LIFO and FIFO basis resulted in
a positive impact to EBITDA and Adjusted EBITDA of approximately
$21.0 million and $7.3 million for the quarters ended March 31, 2011 and 2010, respectively.
(b) 2011 restructuring and related charges consisted
primarily of consulting fees, severance expenses, and other charges
associated with the restructuring of our European organization,
expenses associated with the March
2011 secondary public offering, and charges associated with
evaluating acquisition transactions. 2010 charges consisted of
consulting fees associated with the restructuring of our European
organization.
(c) For both periods, consists of non-cash
compensation.
(d) In 2011, reflects the loss on extinguishment of debt
related to the refinancing of Kraton's debt in February 2011.
Restructuring and related
charges discussed above were recorded in the Condensed Consolidated
Statements of Operations, as follows.
|
|
|
|
|
|
|
Three months ended
March 31,
|
|
|
2011
|
2010
|
|
|
(in
thousands)
|
|
|
|
|
|
Selling, general and
administrative
|
$ 1,505
|
$ 135
|
|
|
|
|
|
|
For Further Information:
Investors: H. Gene Shiels
281-504-4886
Media: Richard A. Ott 281-504-4720
(Logo:
http://photos.prnewswire.com/prnh/20100728/DA42514LOGO)
SOURCE Kraton Performance Polymers, Inc.