TOLEDO, Ohio, Feb. 17 /PRNewswire-FirstCall/ -- -- Free cash flow
of $335 million generated during 2009 -- Record results in the
Roofing business -- Composites profitable for second half of 2009
-- Adjusted EPS expected to grow by 25 percent or more in 2010
Owens Corning today reported consolidated net sales of $4.8 billion
in 2009, compared with $5.8 billion in 2008. Consolidated net sales
for the fourth quarter of 2009 were $1.2 billion, compared with
$1.3 billion in 2008. Sales were lower because of weakness in the
global economy and the U.S. housing market. Owens Corning's 2009
adjusted earnings were $145 million, or $1.14 per adjusted diluted
share, compared with $152 million, or $1.17 per adjusted diluted
share in 2008. Adjusted earnings in the fourth quarter of 2009 were
$1 million, or $0.01 per adjusted diluted share, compared with $24
million, or $0.19 per adjusted diluted share, in the fourth quarter
of 2008. Owens Corning's 2009 net earnings were $64 million, or
$0.50 per diluted share, compared with a net loss of $813 million,
or $6.38 per diluted share. Net loss in the fourth quarter of 2009
was $21 million, or $0.17 per diluted share, compared with a net
loss of $34 million, or $0.27 per diluted share in 2008. See Tables
1, 2 and 5 for a discussion and reconciliation of these items.
Record Roofing performance, significant reductions in working
capital, tight control of capital spending, and a favorable tax
position drove outstanding cash generation in 2009. The Company
generated free cash flow of $335 million in 2009. See Table 10 for
a discussion and reconciliation of these items. Consolidated
Fourth-Quarter and 2009 Results -- Earnings before interest and
taxes (EBIT) in 2009 were $192 million, compared with $234 million
in 2008. Excluding adjusting items (see Table 3), adjusted EBIT in
2009 was $308 million, compared with $328 million in 2008. --
Fourth-quarter 2009 EBIT was $2 million, compared with $26 million
during 2008. Excluding adjusting items (see Table 4), adjusted EBIT
in the fourth quarter of 2009 was $33 million, compared with $59
million during the same period in 2008. -- Gross margin as a
percentage of net sales was 18 percent in 2009, compared with 16
percent in 2008. -- The Company achieved its targeted $160 million
in cost savings in 2009. -- Capital expenditures for 2009 totaled
$232 million, excluding precious metal purchases. Depreciation and
amortization expense totaled $325 million for the year. -- Cash
taxes in 2009 were $18 million, less than the $33 million paid in
2008. -- The Company's safety performance improved 6 percent in
2009, compared with 2008. "I'm pleased with what we accomplished in
2009 in the face of weakness in the U.S. housing market and the
global economy," said Mike Thaman, chairman and chief executive
officer. "Our Roofing business achieved record results. The actions
we took in our Composites segment returned the business to
profitability in the second half of the year. We generated
significant cash flow during the year through reductions in working
capital and capital expenditures. We finished the year with a
strong balance sheet. "Composites performance will show improvement
as we see further strengthening in global demand," Thaman said. "We
will demonstrate operating leverage in Composites as we increase
capacity utilization. Our Roofing business will produce another
strong year. The Insulation business is expected to narrow its
losses despite continuing to face a weak market." Outlook Owens
Corning expects that the Company's 2010 adjusted earnings per share
(EPS) will grow by 25 percent or more. Supported by a strong
balance sheet and a favorable tax position, this level of earnings
would translate to adjusted EBIT of $350 million or more for 2010.
In the Composites segment, the Company believes that overall demand
will continue to trend upward as global industrial activity
improves. The rate of market recovery remains uncertain. Production
levels in 2010 will be increased to meet demand, which will result
in the Company increasing capacity utilization. In addition, this
segment will continue to benefit from synergies associated with the
2007 acquisition and cost-reduction actions taken in 2008 and 2009.
The Company's Roofing business has achieved significant margin
improvements through effective price discipline and gains in
manufacturing and material efficiencies. Owens Corning expects that
these margin improvements will continue to drive profitability
despite weak demand. Uncertainties that could affect Roofing gross
margins include competitive pricing pressure and the cost and
availability of raw materials, mainly asphalt. Owens Corning
believes that its Insulation business will benefit from the
geographic, product and channel mix of the Company's product
portfolio, which will help moderate the impact of continued
demand-driven weakness associated with new construction in the
United States. The Company believes demand for insulation lags U.S.
residential housing starts by approximately three months.
Fourth-quarter 2009 U.S. housing starts were 19 percent lower than
in the fourth quarter of 2008. Therefore, it's expected that new
residential construction-related market demand in the Insulation
business will be weaker in the first quarter of 2010 than it was in
the first quarter of 2009. Cash taxes are expected to be below $35
million in 2010. The Company estimates a long-term effective tax
rate of 25 percent based on the blend of its U.S. and non-U.S.
operations expense. General corporate expense in 2010 is estimated
to be between $60 million and $70 million. General corporate
expense includes corporate staff and activities not directly
related to the operations of the Company's segments. The Company
currently estimates that depreciation and amortization expense will
be about $325 million in 2010. Capital expenditures in 2010,
excluding precious metal purchases, are estimated to be higher than
the $232 million invested in 2009, but less than depreciation and
amortization expense expected in 2010. This level of investment
will allow the Company to maintain its current asset platform and
to complete the new Reinforcements plant that is under construction
in China. Other Financial Items -- At the end of 2009, Owens
Corning had net debt of $1.65 billion, compared with $1.98 billion
in 2008, an improvement of 17 percent. See Table 10. -- Current
cash on hand of $564 million coupled with future cash flows and
other sources will provide ample liquidity to meet the Company's
cash requirements. Owens Corning has no significant debt maturities
until the fourth quarter of 2011 and remains well within compliance
of the financial covenants in its senior revolving credit facility
and senior term-loan facility. -- In October of 2009, Standard
& Poor's Ratings Services affirmed its BBB- rating on Owens
Corning and improved the outlook to stable from negative. -- In
December of 2009, Fitch Ratings initiated coverage of Owens Corning
and assigned a BBB- rating with a stable outlook. -- Owens
Corning's federal tax net operating loss carryforward was $2.6
billion at the end of 2009. Business Segment Highlights Composites
NET SALES Lower sales volumes, resulting from reduced demand
levels, represented approximately two-thirds of the decrease in net
sales for 2009, compared with 2008. Demand for the Company's
Reinforcements products decreased in December of 2008 to 45 percent
below the average monthly demand for the first 11 months of 2008
because of the global economic slow down. Demand increased each
quarter in 2009, and it was stronger in the fourth quarter of 2009
than in the fourth quarter of 2008. The inclusion of four months of
sales from two plants in Europe divested in 2008 also negatively
affected the 2009 to 2008 comparison. The remainder of the decrease
was related to unfavorable product mix, lower selling prices and
unfavorable currency translation. EBIT Owens Corning's Composites
segment EBIT was $241 million lower in 2009 than in 2008. The
decline was primarily driven by lower sales volumes, including the
impact of underutilization of production capacity. Lower selling
prices, partially offset by lower marketing and administrative
expenses, also impacted EBIT for the Composites segment. This
segment includes a portfolio of various products across several
geographic regions including Europe, the Americas and Asia-Pacific.
The Company increased selling prices in many regions and products
to partially recover inflation during the second half of 2008. In
the European Reinforcements business, however, first-quarter 2009
selling prices deteriorated from the fourth quarter of 2008 because
of significant declines in composites demand. This region continued
to experience competitive pressure resulting in gradual declines in
price through the first nine months of 2009. However, prices began
to increase during the fourth quarter. Building Materials NET SALES
Net sales in the Building Materials segment were lower in 2009
compared with 2008, primarily driven by demand weakness resulting
from lower U.S. housing starts. Sales in the Roofing business were
comparable year-over-year as higher selling prices offset lower
sales volumes. The Company increased selling prices in the Roofing
business in the months leading up to the fourth quarter of 2008 to
recover inflation in raw material costs, particularly asphalt.
Since that time, selling prices have remained generally stable.
Lower demand, associated with both reduced storm activity and
reduced new residential construction, resulted in a decreased level
of sales volumes. In the Insulation business, lower sales volumes
represented more than three-fourths of the decline in net sales.
Insulation demand was down primarily because of the lower level of
U.S. housing starts. Lagged U.S. housing starts for 2009 were 43
percent lower than those for the same period in the prior year,
according to data reported by the United States Census Bureau. The
Company's Insulation business includes a diverse portfolio with a
geographic mix of the United States, Canada, Asia-Pacific, and
Latin America; a market mix of residential, commercial, industrial,
and other markets; and a channel mix of retail, contractor and
distribution. In aggregate, these sectors moderated the impact of
lower U.S. housing starts on overall insulation demand. EBIT The
substantial increase in EBIT in the Building Materials segment was
driven by unit margin improvements in the Roofing business, which
were partially offset by lower EBIT performance in the rest of the
segment. In Owens Corning's Roofing business, higher unit margins
accounted for the year-over-year increase in EBIT. The EBIT margin
momentum from the fourth quarter of 2008 continued throughout 2009
as a result of generally stable selling prices and deflation in raw
material costs, primarily asphalt. In the Insulation business,
lower sales volumes, including the impact of underutilization of
the Company's production capacity, accounted for substantially all
of the decrease in EBIT. Other items impacting EBIT were slight
price declines in certain sectors, which were offset by improved
manufacturing productivity; deflation in raw material costs; and
lower marketing and administrative expenses. Owens Corning took
actions across the Building Materials segment during 2008 and 2009
to reduce production capacity and align cost structure with market
demand in response to the continued weak U.S. housing market.
First-quarter 2010 results will be announced on Wednesday, April
28, 2010. Conference Call and Presentation Wednesday, Feb. 17, 2010
11 a.m. ET All Callers Live dial-in telephone number: U.S.
1-866-788-0545 or International 1-857-350-1683 Passcode: 24096865
(Please dial in 10 minutes before conference call start time.) Live
webcast: http://www.owenscorning.com/investors Telephone replay
available through Feb. 24: U.S. 1-888-286-8010 or International
1-617-801-6888 Passcode: 10629464 Replay of webcast also available
at: http://www.owenscorning.com/investors. Presentation To view the
slide presentation during the conference call, please log on to the
live webcast at http://www.owenscorning.com/investors. About Owens
Corning Owens Corning is a leading global producer of residential
and commercial building materials, glass-fiber reinforcements and
engineered materials for composite systems. A Fortune 500 Company
for 55 consecutive years, Owens Corning is committed to driving
sustainability by delivering solutions, transforming markets and
enhancing lives. Founded in 1938, Owens Corning is a market-leading
innovator of glass-fiber technology with sales of $4.8 billion in
2009 and about 16,000 employees in 28 countries on five continents.
Additional information is available at
http://www.owenscorning.com/. This news release contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. These forward-looking statements are subject to risks,
uncertainties and other factors that could cause actual results to
differ materially from those projected in these statements. Such
factors include, without limitation: economic and political
conditions, including new legislation or other governmental
actions; levels of residential and commercial construction
activity; competitive factors; pricing factors; weather conditions;
our level of indebtedness; industry and economic conditions that
affect the market and operating conditions of our customers,
suppliers or lenders; availability and cost of energy and
materials; availability and cost of credit; interest rate
movements; issues related to acquisitions, divestitures and joint
ventures; our ability to use our net operating loss carryforwards;
achievement of expected synergies, cost reductions and/or
productivity improvements; issues involving implementation of new
business systems; foreign exchange fluctuations; research and
development activities; difficulties in managing production
capacity; labor disputes; and, factors detailed from time to time
in the Company's Securities and Exchange Commission filings. The
information in this news release speaks as of the date Feb. 17,
2010 and is subject to change. The Company does not undertake any
duty to update or revise forward-looking statements. Any
distribution of this news release after that date is not intended
and will not be construed as updating or confirming such
information. Table 1 Owens Corning and Subsidiaries Consolidated
Statements of Earnings (Loss) (unaudited) (in millions, except per
share amounts) Twelve Months Ended Dec. 31, -------------------
2009 2008 2007 ---- ---- ---- NET SALES $4,803 $5,847 $4,978 COST
OF SALES 3,954 4,925 4,202 ------------- ---- ---- ---- Gross
margin 849 922 776 OPERATING EXPENSES Marketing and administrative
expenses 522 617 498 Science and technology expenses 61 69 63
Charges related to cost reduction actions 34 7 28 Employee
emergence equity program expense 29 26 37 Other (income) expenses
11 (31) 6 ----------------------- --- --- --- Total operating
expenses 657 688 632 ------------------------ --- --- --- EARNINGS
FROM CONTINUING OPERATIONS BEFORE INTEREST AND TAXES 192 234 144
Interest expense, net 111 116 122 --------------------- --- --- ---
EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES 81 118 22 Income
tax expense (benefit) 14 931 (8) ---------------------------- ---
--- --- EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE EQUITY IN
NET EARNINGS (LOSS) OF AFFILIATES 67 (813) 30 Equity in net
earnings (loss) of affiliates - 2 (1) -----------------------------
--- --- --- EARNINGS (LOSS) FROM CONTINUING OPERATIONS 67 (811) 29
Discontinued operations: Earnings from discontinued operations, net
of tax of $0, $0 and $5, respectively - - 9 Gain on sale of
discontinued operations, net of tax of $0, $0 and $40, respectively
- - 60 --------------------------------- --- --- --- Total earnings
from discontinued operations - - 69 ------------------------ ---
--- --- NET EARNINGS (LOSS) 67 (811) 98 Less: Net earnings
attributable to noncontrolling interests 3 2 3
------------------------- --- --- --- NET EARNINGS (LOSS)
ATTRIBUTABLE TO OWENS CORNING $64 $(813) $95
================================ === ===== === AMOUNTS ATTRIBUTABLE
TO OWENS CORNING COMMON STOCKHOLDERS: Earnings (loss) from
continuing operations, net of tax $64 $(813) $26 Discontinued
operations, net of tax - - 69 -----------------------------------
--- --- --- NET EARNINGS (LOSS) $64 $(813) $95 ===================
== ===== == BASIC EARNINGS (LOSS) PER COMMON SHARE ATTRIBUTABLE TO
OWENS CORNING COMMON STOCKHOLDERS Earnings (loss) from continuing
operations $0.51 $(6.38) $0.20 Earnings from discontinued
operations - - 0.54 -------------------------- --- --- ---- Basic
earnings (loss) per common share $0.51 $(6.38) $0.74
================================ ===== ====== ===== DILUTED
EARNINGS (LOSS) PER COMMON SHARE ATTRIBUTABLE TO OWENS CORNING
COMMON STOCKHOLDERS Earnings (loss) from continuing operations
$0.50 $(6.38) $0.20 Earnings from discontinued operations - - 0.54
-------------------------- --- --- ---- Diluted earnings (loss) per
common share $0.50 $(6.38) $0.74 ==================================
===== ====== ===== WEIGHTED-AVERAGE COMMON SHARES Basic 124.8 127.4
128.4 Diluted 127.1 127.4 129.0 Owens Corning follows the
authoritative guidance referring to "Noncontrolling Interest in
Consolidated Financial Statements," effective January 1, 2009,
which, among other things, changed the presentation format and
certain captions of the Consolidated Statements of Earnings (Loss)
and Consolidated Balance Sheets. Owens Corning uses the captions
recommended by this standard in its Consolidated Financial
Statements such as net earnings attributable to Owens Corning and
diluted earnings per common share attributable to Owens Corning
common stockholders. However, in the preceding release Owens
Corning has shortened this language to net earnings and earnings
per share (or a slight variation thereof), respectively. Table 2
Owens Corning and Subsidiaries Consolidated Statements of Earnings
(Loss) (unaudited) (in millions, except per share amounts) Three
Months Ended Dec. 31, ------------------ 2009 2008 ---- ---- NET
SALES $1,162 $1,291 COST OF SALES 1,001 1,091 ------------- ----
---- Gross margin 161 200 OPERATING EXPENSES Marketing and
administrative expenses 135 159 Science and technology expenses 16
17 Charges (credits) related to cost reduction actions 1 (1)
Employee emergence equity program expense 12 6 Other income (5) (7)
------------ --- --- Total operating expenses 159 174
------------------------ --- --- EARNINGS BEFORE INTEREST AND TAXES
2 26 Interest expense, net 30 26 --------------------- --- ---
(LOSS) BEFORE TAXES (28) - Income tax expense (benefit) (9) 35
---------------------------- --- --- (LOSS) BEFORE EQUITY IN NET
EARNINGS OF AFFILIATES (19) (35) Equity in net earnings of
affiliates - 1 ------------------------------------ --- --- NET
LOSS (19) (34) Less: Net earnings attributable to noncontrolling
interests 2 - ---------------------------------- --- --- NET LOSS
ATTRIBUTABLE TO OWENS CORNING $(21) $(34)
====================================== ==== ==== BASIC LOSS PER
COMMON SHARE ATTRIBUTABLE TO OWENS CORNING COMMON STOCKHOLDERS
$(0.17) $(0.27) DILUTED LOSS PER COMMON SHARE ATTRIBUTABLE TO OWENS
CORNING COMMON STOCKHOLDERS $(0.17) $(0.27) WEIGHTED AVERAGE COMMON
SHARES Basic 125.7 124.8 Diluted 125.7 124.8 Owens Corning follows
the authoritative guidance referring to "Noncontrolling Interest in
Consolidated Financial Statements," effective January 1, 2009,
which, among other things, changed the presentation format and
certain captions of the Consolidated Statements of Earnings (Loss)
and Consolidated Balance Sheets. Owens Corning uses the captions
recommended by this standard in its Consolidated Financial
Statements such as net earnings attributable to Owens Corning and
diluted earnings per common share attributable to Owens Corning
common stockholders. However, in the preceding release Owens
Corning has shortened this language to net earnings and earnings
per share (or a slight variation thereof), respectively. Table 3
Owens Corning and Subsidiaries EBIT Reconciliation Schedules
(unaudited) For purposes of internal review of Owens Corning's
year-over-year operational performance, management excludes from
net earnings attributable to Owens Corning certain items it
believes are not the result of current operations. Additionally,
management views net precious metal lease expense as a financing
item included in net interest expense rather than as a product cost
included in cost of sales. The adjusted financial measure resulting
from these adjustments is used internally by Owens Corning for
various purposes, including reporting results of operations to the
Board of Directors, analysis of performance, and related employee
compensation measures. Although management believes that these
adjustments result in a measure that provides it a useful
representation of its operational performance, the adjusted measure
should not be considered in isolation or as a substitute for net
earnings attributable to Owens Corning as prepared in accordance
with accounting principles generally accepted in the United States.
Adjusting items are shown in the table below (in millions): Twelve
Months Ended Dec. 31, -------------------------------- 2009 2008
2007 ---- ---- ---- Net precious metal lease (expense) income $-
$(9) $3 Charges related to cost reduction actions and related items
(53) (7) (54) Acquisition integration and transaction costs (33)
(85) (101) Gains (losses) on sales of assets and other (1) 33 (12)
Employee emergence equity program expense (29) (26) (37)
------------------------- --- --- --- Total adjusting items $(116)
$(94) $(201) ===================== ===== ==== ===== The
reconciliation from net earnings (loss) attributable to Owens
Corning to Adjusted EBIT is shown in the table below (in millions):
Twelve Months Ended Dec. 31, -------------------------------- 2009
2008 2007 ---- ---- ---- NET EARNINGS (LOSS) ATTRIBUTABLE TO OWENS
CORNING $64 $(813) $95 Less: Net earnings attributable to
noncontrolling interests 3 2 3 ------------------------- --- ---
--- NET EARNINGS (LOSS) 67 (811) 98 Discontinued operations
Earnings from discontinued operations, net of tax of $0, $0 and $5,
respectively - - 9 Gain on sale of discontinued operations, net of
tax of $0, $0 and $40, respectively - - 60 ---------------------
--- --- --- Total earnings from discontinued operations - - 69
------------------------ --- --- --- EARNINGS (LOSS) FROM
CONTINUING OPERATIONS 67 (811) 29 Equity in net earnings (loss) of
affiliates - 2 (1) ----------------------------- --- --- ---
EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE EQUITY IN NET
EARNINGS (LOSS) OF AFFILIATES 67 (813) 30 Income tax expense
(benefit) 14 931 (8) ---------------------------- --- --- ---
EARNINGS FROM CONTINUING OPERATIONS BEFORE TAXES 81 118 22 Interest
expense, net 111 116 122 --------------------- --- --- --- EARNINGS
FROM CONTINUING OPERATIONS BEFORE 192 234 144 INTEREST AND TAXES
Less: adjusting items from above (116) (94) (201)
-------------------------- ---- --- ---- ADJUSTED EBIT $308 $328
$345 ============= ==== ==== ==== Table 4 Owens Corning and
Subsidiaries EBIT Reconciliation Schedules (unaudited) For purposes
of internal review of Owens Corning's year-over-year operational
performance, management excludes from net earnings attributable to
Owens Corning certain items it believes are not the result of
current operations. Additionally, management views net precious
metal lease expense as a financing item included in net interest
expense rather than as a product cost included in cost of sales.
The adjusted financial measure resulting from these adjustments is
used internally by Owens Corning for various purposes, including
reporting results of operations to the Board of Directors, analysis
of performance, and related employee compensation measures.
Although management believes that these adjustments result in a
measure that provides it a useful representation of its operational
performance, the adjusted measure should not be considered in
isolation or as a substitute for net earnings attributable to Owens
Corning as prepared in accordance with accounting principles
generally accepted in the United States. Adjusting items are shown
in the table below (in millions): Three Months Ended Dec. 31,
-------- 2009 2008 ---- ---- Net precious metal lease (expense) $-
$(2) (Charges) credits related to cost reduction actions and
related items (8) 1 Acquisition integration and transaction costs
(12) (23) Gains (losses) on sales of assets and other 1 (3)
Employee emergence equity program expense (12) (6)
--------------------------------- --- --- Total adjusting items
$(31) $(33) ===================== ==== ==== The reconciliation from
net earnings (loss) attributable to Owens Corning to Adjusted EBIT
is shown in the table below (in millions): Three Months Ended Dec.
31, -------- 2009 2008 ---- ---- NET EARNINGS (LOSS) ATTRIBUTABLE
TO OWENS CORNING $(21) $(34) Less: Net earnings attributable to
noncontrolling interests 2 - ---------------------------------- ---
--- NET EARNINGS (LOSS) (19) (34) Equity in net earnings (loss) of
affiliates - 1 -------------------------------- --- --- NET
EARNINGS (LOSS) OF AFFILIATES (19) (35) Income tax expense
(benefit) (9) 35 ---------------------------- --- --- EARNINGS FROM
OPERATIONS BEFORE TAXES (28) - Interest expense, net 30 26
--------------------- --- --- EARNINGS FROM OPERATIONS BEFORE 2 26
INTEREST AND TAXES - - Less: adjusting items from above (31) (33)
-------------------------------- --- --- ADJUSTED EBIT $33 $59
============= === === Table 5 Owens Corning and Subsidiaries EPS
Reconciliation Schedules (unaudited) (in millions, except per share
data) For purposes of internal review of Owens Corning's
year-over-year operational performance, management excludes from
net earnings attributable to Owens Corning certain items it
believes are not the result of current operations. Additionally,
management views net precious metal lease expense as a financing
item included in net interest expense rather than as a product cost
included in cost of sales. The adjusted financial measures
resulting from these adjustments are used internally by Owens
Corning for various purposes, including reporting results of
operations to the Board of Directors, analysis of performance and
related employee compensation measures. Although management
believes that these adjustments result in measures that provide it
a useful representation of its operational performance, the
adjusted measures should not be considered in isolation or as a
substitute for net earnings attributable to Owens Corning as
prepared in accordance with accounting principles generally
accepted in the United States. A reconciliation from net earnings
attributable to Owens Corning to Adjusted Earnings, a
reconciliation from diluted earnings per share to Adjusted diluted
earnings per share and a reconciliation from weighted-average
shares outstanding used for diluted earnings per share to Adjusted
diluted shares outstanding are shown in the tables below. Three
Months Ended Twelve Months Ended Dec. 31, Dec. 31,
--------------------- --------------------- 2009 2008 2009 2008
---- ---- ---- ---- RECONCILIATION TO ADJUSTED EARNINGS Net
earnings (loss) attributable to Owens Corning $(21) $(34) $64
$(813) Adjustment to remove adjusting items 31 33 116 94 Adjustment
to classify net precious metal lease expense as interest - (2) -
(9) Adjustment to tax expense to reflect an expected long-term rate
of 25%* (9) 27 (35) 880 ---------------------- --- --- --- ---
ADJUSTED EARNINGS $1 $24 $145 $152 ================= === === ====
==== RECONCILIATION TO ADJUSTED DILUTED EARNINGS PER SHARE
ATTRIBUTABLE TO OWENS CORNING COMMON STOCKHOLDERS DILUTED EARNINGS
(LOSS) PER COMMON SHARE ATTRIBUTABLE TO OWENS CORNING COMMON
STOCKHOLDERS $(0.17) $0.27 $0.50 $(6.38) Convert to adjusted
diluted earnings (loss) per share - 0.01 - 0.13 Adjustment to
remove adjusting items 0.24 0.26 0.91 0.72 Adjustment to classify
net precious metal lease expense as interest - (0.02) - (0.07)
Adjustment to tax expense to reflect an expected long-term rate of
25%* (0.06) (0.33) (0.27) 6.77 -------------------- ----- -----
----- ---- ADJUSTED DILUTED EARNINGS PER SHARE ATTRIBUTABLE TO
OWENS CORNING COMMON STOCKHOLDERS $0.01 $0.19 $1.14 $1.17
=================== ===== ===== ===== ===== RECONCILIATION TO
ADJUSTED DILUTED SHARES OUTSTANDING Weighted-average shares
outstanding used for basic earnings per share 125.7 124.8 124.8
127.4 Non-vested restricted shares 1.9 1.1 2.3 1.4 Shares related
to employee emergence program - 1.0 - 1.1 ------------------- ---
--- --- --- Adjusted diluted shares outstanding** 127.6 126.9 127.1
129.9 ====================== ===== ===== ===== ===== * The company
estimates a long-term sustainable effective tax rate of 25% based
upon the projected blend of its U.S. and non-U.S. operations. **
The employee emergence shares are reflected as outstanding because
the employee emergence equity expense has been removed from
adjusted earnings. Table 6 Owens Corning and Subsidiaries
Consolidated Balance Sheets (unaudited) (in millions) ASSETS Dec.
31, Dec. 31, ------ 2009 2008 ------- ------- CURRENT ASSETS Cash
and cash equivalents $564 $236 Receivables, less allowances of $23
at Dec. 31, 2009 and $21 at Dec. 31, 2008 552 576 Inventories 615
899 Assets held for sale - current - 13 Other current assets 123
133 -------------------- --- --- Total current assets 1,854 1,857
Property, plant and equipment, net 2,806 2,819 Goodwill 1,124 1,124
Intangible assets 1,169 1,190 Deferred income taxes 31 42 Assets
held for sale - non-current - 3 Other non-current assets 183 187
------------------------ --- --- TOTAL ASSETS $7,167 $7,222
============ ====== ====== LIABILITIES AND EQUITY
---------------------- CURRENT LIABILITIES Accounts payable and
accrued liabilities $923 $1,121 Short-term debt 11 30 Long-term
debt - current portion 9 16 Liabilities held for sale - current - 8
----------------------------------- --- --- Total current
liabilities 943 1,175 Long-term debt, net of current portion 2,177
2,172 Pension plan liability 340 308 Other employee benefits
liability 295 270 Deferred income taxes 386 400 Other liabilities
143 117 Commitments and contingencies Mandatorily redeemable
noncontrolling interest 30 - OWENS CORNING STOCKHOLDERS' EQUITY
Preferred stock, par value $0.01 per share (a) - - Common stock,
par value $0.01 per share (b) 1 1 Additional paid in capital 3,847
3,824 Accumulated deficit (739) (803) Accumulated other
comprehensive deficit (185) (183) Cost of common stock in treasury
(c) (104) (101) ------------------------------------ ---- ----
Total Owens Corning stockholders' equity 2,820 2,738 Noncontrolling
interest 33 42 ----------------------- --- --- Total equity 2,853
2,780 ------------ ---- ---- TOTAL LIABILITIES AND EQUITY $7,167
$7,222 ============================ ====== ====== (a) 10 shares
authorized; none issued or outstanding at Dec. 31, 2009 and Dec.
31, 2008 (b) 400 shares authorized; 132.6 issued and 127.8
outstanding at Dec. 31, 2009; 131.7 issued and 127.0 outstanding at
Dec. 31, 2008 (c) 4.8 shares at Dec. 31, 2009 and 4.7 shares at
Dec. 31, 2008 Table 7 Owens Corning and Subsidiaries Consolidated
Statements of Cash Flows (unaudited) (in millions) Twelve Months
Ended Dec. 31, -------- 2009 2008 2007 ---- ---- ---- NET CASH FLOW
PROVIDED BY OPERATING ACTIVITIES Net earnings (loss) $67 $(811) $98
Adjustments to reconcile net earnings (loss) to cash provided by
operating activities: Depreciation and amortization 325 331 343
Gain on sale of businesses and fixed assets (9) (51) (104)
Impairment of long-lived assets 3 11 76 Deferred income taxes 17
893 - Provision for pension and other employee benefits liabilities
38 30 45 Stock-based compensation expense 52 43 42 Other non-cash
(13) (17) (14) Restricted cash 7 2 52 Payments related to Chapter
11 filings - (3) (109) Change in working capital 134 (164) (93)
Pension fund contribution (43) (73) (121) Payments for other
employee benefits liabilities (25) (24) (25) Other (12) 26 (8)
----- --- --- --- Net cash flow provided by operating activities
541 193 182 ----------------------------------- --- --- --- NET
CASH FLOW USED FOR INVESTING ACTIVITIES Additions to plant and
equipment (243) (434) (247) Investment in subsidiaries and
affiliates, net of cash acquired - - (620) Proceeds from the sale
of assets and affiliates 39 272 437
-------------------------------- --- --- --- Net cash flow used for
investing activities (204) (162) (430)
-------------------------------- ---- ---- ---- NET CASH FLOW
PROVIDED BY (USED FOR) FINANCING ACTIVITIES Proceeds from issuance
of senior notes 344 - - Proceeds from senior revolving credit
facility 260 1,135 713 Payments on senior revolving credit facility
(586) (955) (573) Proceeds from long-term debt 6 12 617 Payments on
long-term debt (15) (9) (85) Net decrease in short-term debt (20)
(16) (13) Payment of contingent note to Asbestos PI Trust - -
(1,390) Purchases of noncontrolling interest (3) - - Purchases of
treasury stock (3) (100) - --------------------------- --- ---- ---
Net cash flow provided by (used for) financing activities (17) 67
(731) ------------------------------- --- --- ---- Effect of
exchange rate changes on cash 8 3 25
---------------------------------- --- --- --- Net increase
(decrease) in cash and cash equivalents 328 101 (954) Cash and cash
equivalents at beginning of period 236 135 1,089
---------------------------- --- --- ----- CASH AND CASH
EQUIVALENTS AT END OF PERIOD $564 $236 $135
=================================== ==== ==== ==== DISCLOSURE OF
CASH FLOW INFORMATION Cash paid during the year for income taxes
$18 $33 $40 Cash paid during the year for interest $120 $120 $159
Table 8 Owens Corning and Subsidiaries Segment Data and Additional
Business Information (unaudited) Composites The table below
provides a summary of net sales, EBIT and depreciation and
amortization expense for our Composites segment (in millions):
Twelve Months Ended Dec. 31, ------------------- 2009 2008 2007
---- ---- ---- Net sales $1,633 $2,363 $1,695 % change from prior
year -31% 39% 23% EBIT $(33) $208 $123 EBIT as a % of net sales -2%
9% 7% Depreciation and amortization expense $130 $138 $115
--------------------- --- --- --- Building Materials The table
below provides a summary of net sales, EBIT and depreciation and
amortization expense for the Building Materials segment and our
businesses within this segment (in millions): Twelve Months Ended
Dec. 31, ------------------- 2009 2008 2007 ---- ---- ---- Net
sales Insulation $1,285 $1,573 $1,776 Roofing 1,898 1,863 1,375
Other 141 235 301 Eliminations (10) (15) (13) ------------ --- ---
--- Total Building Materials $3,314 $3,656 $3,439
------------------------ ------ ------ ------ % change from prior
year -9% 6% -18% EBIT Insulation $(85) $14 $192 Roofing 530 185 27
Other (44) (24) 14 ----- --- --- -- Total Building Materials $401
$175 $233 ------------------------ --- --- --- EBIT as a % of net
sales 12% 5% 7% Depreciation and amortization expense Insulation
$117 $119 $125 Roofing 42 42 40 Other 15 12 10 ----- --- --- ---
Total Building Materials $174 $173 $175 ------------------------
--- --- --- Table 9 Owens Corning and Subsidiaries Segment Data and
Additional Business Information (unaudited) Composites The table
below provides a summary of net sales, EBIT and depreciation and
amortization expense for our Composites segment (in millions):
Three Months Ended Dec. 31, ------------------ 2009 2008 ---- ----
Net sales $446 $448 % change from prior year 0% -17% EBIT $2 $19
EBIT as a % of net sales 0% 4% Depreciation and amortization
expense $40 $41 ------------------------------------- --- ---
Building Materials The table below provides a summary of net sales,
EBIT and depreciation and amortization expense for the Building
Materials segment and our businesses within this segment (in
millions): Three Months Ended Dec. 31, ------------------ 2009 2008
---- ---- Net sales Insulation $379 $375 Roofing 338 466 Other 31
46 Eliminations (2) (4) ------------ --- --- Total Building
Materials $746 $883 ------------------------ --- --- % change from
prior year -16% 11% EBIT Insulation $(9) $(9) Roofing 72 70 Other
(14) (13) ----- --- --- Total Building Materials $49 $48
------------------------ --- --- EBIT as a % of net sales 7% 5%
Depreciation and amortization expense Insulation $27 $30 Roofing 11
12 Other 4 3 ----- --- --- Total Building Materials $42 $45
------------------------ --- --- Table 10 Owens Corning and
Subsidiaries Free Cash Flow and Net Debt (unaudited) The following
table presents the free cash flow and net debt. Free cash flow is
the change in net debt excluding the cash impact of issuing new
stock, repurchasing treasury stock, and paying stockholder
dividends. Net debt is total debt excluding the impact of the
interest rate swap, less cash and cash equivalents. Free cash flow
and net debt are as follows (in millions): Three Months Ended Dec.
31, ------------------ Balance as of December 31: 2009 2008
-------------------------- ---- ---- Short-term debt $11 $30
Long-term debt -- current portion 9 16 Long-term debt, net of
current portion 2,177 2,172 ------------------------------ -----
----- Total debt 2,197 2,218 Less: Cash and cash equivalents 564
236 Less: Impact of interest rate swap on debt (17) -
------------------------------------- --- --- Net debt $1,650
$1,982 -------- ------ ------ Balance as of September 30: 2009 2008
--------------------------- ---- ---- Short-term debt $12 $40
Long-term debt -- current portion 10 5 Long-term debt, net of
current portion 2,192 2,045 ------------------------------ -----
----- Total debt 2,214 2,090 Less: Cash and cash equivalents 387 76
------------------------------- --- --- Net debt 1,827 2,014
-------- ----- ----- Change in net debt 177 32 Less: Purchases of
treasury stock for the three months ended December 31, 2009 and
2008 (3) (38) ------------------------------------- --- --- Free
cash flow generated $180 $70 ======================== ==== ===
Twelve Months Ended Dec. 31, ------------------- Balance as of
December 31: 2009 2008 -------------------------- ---- ----
Short-term debt $11 $30 Long-term debt -- current portion 9 16
Long-term debt, net of current portion 2,177 2,172
------------------------------ ----- ----- Total debt 2,197 2,218
Less: Cash and cash equivalents 564 236 Less: Impact of interest
rate swap on debt (17) - ------------------------------------- ---
--- Net debt $1,650 $1,982 -------- ------ ------ Balance as of
December 31: 2008 2007 -------------------------- ---- ----
Short-term debt $30 $47 Long-term debt -- current portion 16 10
Long-term debt, net of current portion 2,172 1,993
------------------------------ ----- ----- Total debt 2,218 2,050
Less: Cash and cash equivalents 236 135
------------------------------- --- --- Net debt 1,982 1,915
-------- ----- ----- Change in net debt 332 (67) Less: Purchases of
treasury stock for the twelve months ended December 31, 2009 and
2008 (3) (100) ------------------------------------- --- ---- Free
cash flow generated $335 $33 ======================== ==== ===
DATASOURCE: Owens Corning CONTACT: Investor & Media Relations,
Scott Deitz, +1-419-248-8935 Web Site: http://www.owenscorning.com/
Copyright
Owens Corning (NYSE:OC)
Historical Stock Chart
From Jul 2024 to Aug 2024
Owens Corning (NYSE:OC)
Historical Stock Chart
From Aug 2023 to Aug 2024