Operating Profits Up $46 million Over Second Quarter BOSTON, July
29 /PRNewswire-FirstCall/ -- Cabot Corporation (NYSE:CBT) today
announced results for its third quarter of fiscal 2009. (Logo:
http://www.newscom.com/cgi-bin/prnh/20000323/CABOTLOGO ) Quarterly
Highlights -- Volumes in all key businesses improved sequentially
with emerging markets showing strongest signs of recovery. --
Higher carbon black unit margins contributed to sequential
performance improvement. -- Restructuring and cost saving actions
are ahead of plan and benefited results. -- Strategic commitment to
emerging market expansion continues with the completion of 150,000
metric tons of carbon black capacity in Tianjin, China. -- Cash
position remains strong, with a quarter end cash balance of $177
million after debt reduction of $46 million and dividend payments
of $12 million. (In millions, except per share amounts) 2009 2008
---- ---- Third First Third First Quarter 9 months Quarter 9 months
------- -------- ------- -------- Net sales $511 $1,633 $840 $2,337
Net (loss)/ income $(12) $(66) $27 $74 Diluted (loss)/ earnings per
share from continuing operations $(0.19) $(1.04) $0.43 $1.16 Less:
Certain items per share (0.25) (0.90) (0.09) (0.11) Adjusted
earnings per share $0.06 $(0.14) $0.52 $1.27 ----- ------ -----
----- For the third quarter of fiscal 2009, the Company reported a
net loss of $12 million (a loss of $0.19 per common share from
continuing operations). Adjusted EPS was income of $0.06 per common
share, excluding $0.25 per common share of certain items
principally related to restructuring charges. Commenting on the
results, Patrick Prevost, Cabot's President and CEO, stated, "For
the first time since the beginning of the downturn, we are seeing
operating performance recover in a significant way. The
profitability of our business segments improved by $51 million
sequentially, excluding restructuring charges. We are encouraged by
volume increases throughout the quarter, particularly in emerging
markets where we remain committed to expanding our already strong
competitive position. Carbon black margins improved due to
aggressive commercial efforts and the reduced impact of older, high
cost inventories. Our restructuring and cost saving actions are
ahead of plan and benefited results during the quarter. Apart from
carbon black, our Specialty Fluids Segment had a very strong
quarter driven by favorable prices and increased activity in the
North Sea and Kazakhstan. Progress continued in our New Business
Segment with improved revenue and cash flow versus the prior year.
" Financial Detail Segment Results Core Segment- When compared to
the second quarter of fiscal 2009, Rubber Blacks profitability
increased by $28 million due to higher volumes and unit margins and
lower operating expenses from restructuring and cost saving
actions. Volumes increased by 8% sequentially, as improvements in
emerging markets (China up 34%; Asia Pacific, excluding China, up
25%; South America up 6%) more than offset declines in more
developed markets (North America and Europe each down 7%). When
compared to the third quarter of fiscal 2008, profitability
decreased by $32 million due to 24% lower volumes from weaker
global demand in the tire and automotive markets and lower unit
margins from older, high cost inventories. This decline was
partially offset by lower operating expenses from restructuring and
cost saving actions. When compared to the second quarter of fiscal
2009, profitability in the Supermetals Business increased by $10
million due to higher volumes, particularly in Asia, and lower
manufacturing expenses from cost saving actions and higher plant
utilization. When compared to the third quarter of fiscal 2008
profitability increased by $5 million. Higher product prices and
lower selling and administrative expenses from cost saving actions
more than offset lower volumes due to weaker demand in the
electronics market. The Supermetals Business continues to focus on
cash generation and during the third quarter of fiscal 2009
generated $6 million in cash principally from positive operating
results. Performance Segment- When compared to the second quarter
of fiscal 2009, profitability in the Performance Segment increased
by $11 million. The increase was driven principally by higher
volumes, particularly in emerging markets and the electronics and
infrastructure market sectors. Sequentially, volumes increased by
12% in Performance Products and by 26% in Fumed Metal Oxides. When
compared to the third quarter of fiscal 2008, profitability
decreased by $22 million. The decrease was largely the result of
lower volumes from weakness in the automotive, construction and
electronics markets and was partially offset by lower operating
expenses from restructuring and cost saving actions. Volumes were
down 29% in Performance Products and 26% in Fumed Metal Oxides year
over year. Specialty Fluids Segment- When compared to the second
quarter of fiscal 2009, profitability in the Specialty Fluids
Segment increased by $5 million due to significantly higher
revenues from favorable pricing and increased activity in the North
Sea and Kazakhstan. When compared to the third quarter of fiscal
2008, profitability increased by $4 million principally due to
favorable prices and lower operating expenses from cost saving
actions. New Business Segment- Year to date cash flow for the New
Business Segment improved by $35 million when compared to the same
period of fiscal 2008. The increase is principally due to revenue
growth and benefits from cost saving actions. When compared to the
second quarter of fiscal 2009, current quarter revenues declined by
$2 million due to the timing of revenue in the Aerogel Business,
partially offset by higher volumes and favorable product mix in the
Inkjet Colorants Business. Cash Performance- During the third
quarter of fiscal 2009, operations generated $36 million of cash,
including a $10 million decrease in working capital. The Company
ended the quarter with a cash balance of $177 million, after
dividend payments of $12 million and a $46 million reduction of
debt, and $197 million of unused credit available under committed
facilities. Capital expenditures were $27 million in the quarter.
Taxes- During the third quarter of fiscal 2009, the Company
recorded a tax provision of $7 million. As anticipated, this
included a $9 million reversal of tax benefits primarily
attributable to the timing of losses in certain locations. There
remain $6 million of previously recorded tax benefits that will
reverse in the fourth quarter of fiscal 2009. Outlook Commenting on
the outlook for the Company, Prevost said, "We are encouraged by
the growth in our sales volumes and believe the non-discretionary
nature of our customers' end products will continue to provide
support for the recovery. Although we remain cautious about the
speed of the recovery, we have positioned the Company well to
capitalize on demand improvements in our key end markets. We have
completed the doubling of capacity at our carbon black plant in
Tianjin, China, giving us the largest and lowest cost carbon black
facility in the highest growth region in the world. Our
restructuring activities remain on track to deliver in excess of
$80 million in fixed cost savings on a fiscal 2010 run rate basis
and approximately 30% of these savings will be realized in fiscal
2009. Additionally, our estimate of the restructuring costs has
been reduced by $25 million. These actions are consistent with our
global strategy and will strengthen our competitive positions in
our key business segments." Earnings Call The Company will host a
conference call with industry analysts at 2:00 p.m. Eastern time on
July 30, 2009. The call can be accessed through Cabot's investor
relations website at http://investor.cabot-corp.com/. Cabot
Corporation, headquartered in Boston, Massachusetts, is a global
performance materials company. Cabot's major products are carbon
black, fumed silica, inkjet colorants, aerogel, capacitor
materials, and cesium formate drilling fluids. The Company's
website is: http://www.cabot-corp.com/. Forward-Looking Statements-
This earnings 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 our expectations concerning the annualized fixed
cost savings, and the costs associated with, we expect from our
restructuring initiative and demand for our products), strategy for
growth, market position, and expected financial results are
forward-looking statements. Some of the forward-looking statements
may be identified by words like "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
Cabot, particularly its latest annual report on Form 10-K, could
cause results to differ materially from those stated. These factors
include, but are not limited to changes in raw material costs;
costs associated with the research and development of new products,
including regulatory approval and market acceptance; competitive
pressures; successful integration of structural changes, including
restructuring plans, and joint ventures; the laws, regulations,
policies and economic conditions, including inflation, interest and
foreign currency exchange rates, of countries in which the company
does business; and severe weather events that cause business
interruptions, including plant and power outages, or disruptions in
supplier or customer operations. Use of Non-GAAP Financial
Measures- The preceding discussion of our results and the
accompanying financial tables report adjusted EPS and also include
information on our reportable segment sales and segment (or
business) operating profit before taxes ("PBT"). Adjusted EPS and
segment PBT are non-GAAP financial measures and are not intended to
replace EPS and income (loss) from continuing operations before
taxes, equity in net income of affiliated companies and minority
interest, respectively, the most directly comparable GAAP financial
measures. Both EPS and adjusted EPS are calculated on a diluted
share basis. In calculating adjusted EPS and segment PBT, we
exclude certain items, meaning items that are significant and
unusual or infrequent and not believed to reflect the true
underlying business performance, and, therefore, are not allocated
to a segment's results or included in adjusted EPS. Further, in
calculating segment PBT we include equity in net income of
affiliated companies, royalties paid by equity affiliates, minority
interest and allocated corporate costs but exclude interest
expense, foreign currency translation gains and losses, interest
income, dividend income and unallocated corporate costs. Our chief
operating decision-maker uses adjusted EPS to evaluate the
underlying earnings power of the Company. Segment PBT is used to
evaluate changes in the operating results of each segment before
non-operating factors and before certain items and to allocate
resources to the segments. We believe that these non-GAAP measures
also assist our investors in evaluating the changes in our results
and the Company's performance. A reconciliation of adjusted EPS to
EPS is shown in the table titled Certain Items and Reconciliation
of Adjusted EPS, and a reconciliation of total segment PBT to
income (loss) from operations before taxes, equity in net income of
affiliated companies and minority interest is shown in the table
titled Summary Results by Segments. The certain items that are
excluded from our calculation of adjusted EPS and segment PBT are
detailed in the table titled Certain Items and Reconciliation of
Adjusted EPS. Third Quarter Earnings Announcement, Fiscal 2009
CABOT CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS
------------------------------------------------------------------------
Periods ended June 30 Dollars in millions, except per share Three
Months Nine Months amounts (unaudited) 2009 2008 2009 2008
------------------------------------------------------------------------
Net sales and other operating revenues $511 $840 $1,633 $2,337 Cost
of sales 443 703 1,478 1,966 --- --- ----- ----- Gross profits 68
137 155 371 Selling and administrative expenses 50 67 160 190
Research and technical expenses 16 20 53 55 -- -- -- -- Income
(loss) from operations 2 50 (58) 126 Other income and expense
Interest and dividend income - - 2 3 Interest expense (6) (9) (23)
(28) Other income (expense) 2 (2) (13) (5) -- --- --- --- Total
other income and expense (4) (11) (34) (30) -- --- --- --- (Loss)
income from operations before income taxes (2) 39 (92) 96
(Provision) benefit for income taxes (7) (8) 23 (13) Equity in net
income of affiliated companies, net of tax - 2 2 6 Minority
interest in net income, net of tax (3) (6) 1 (15) -- -- - ---
(Loss) income from continuing operations (12) 27 (66) 74 Loss from
discontinued operations, net of tax (A) - - - - ---- --- ---- ---
Net (loss) income $(12) $27 $(66) $74 ---- --- ---- --- Diluted
(loss) earnings per share of common stock Continuing operations
$(0.19) $0.43 $(1.04) $1.16 Discontinued operations (A) (0.01) -
(0.01) - ----- --- ----- --- Net (loss) income per share $(0.20)
$0.43 $(1.05) $1.16 Weighted average common shares outstanding
Diluted 63 63 63 63 (A) Amounts relate to legal settlements in
connection with our discontinued operations. Third Quarter Earnings
Announcement, Fiscal 2009 CABOT CORPORATION SUMMARY RESULTS BY
SEGMENTS
-----------------------------------------------------------------------
Periods ended June 30 Dollars in millions, except per share Three
Months Nine Months amounts (unaudited) 2009 2008 2009 2008
-----------------------------------------------------------------------
SALES Core Segment $310 $537 $1,049 $1,511 Rubber blacks 272 499
943 1,364 Supermetals 38 38 106 147 Performance Segment 149 247 438
695 Performance products 98 175 293 481 Fumed metal oxides 51 72
145 214 New Business Segment 14 14 48 37 Inkjet colorants 10 11 32
30 Aerogel(A) 2 2 11 5 Superior MicroPowders 2 1 5 2 Specialty
Fluids Segment 19 17 45 49 -- -- -- -- Segment sales 492 815 1,580
2,292 Unallocated and other (A), (B) 19 25 53 45 -- -- -- -- Net
sales and other operating revenues $511 $840 $1,633 $2,337 ----
---- ------ ------ SEGMENT PROFIT Core Segment $14 $41 $17 $89
Rubber blacks 11 43 18 87 Supermetals 3 (2) (1) 2 Performance
Segment 10 32 12 95 New Business Segment (4) (9) (8) (30) Specialty
Fluids Segment 9 5 17 18 --- --- -- -- Total Segment Profit ( C )
29 69 38 172 Interest expense (6) (9) (23) (28) Certain items (D)
(19) (8) (67) (10) Unallocated corporate costs (E) (7) (8) (22)
(25) General unallocated expense (F) 1 (3) (16) (7) Less: Equity in
net income of affiliated companies, net of tax - (2) (2) (6) --- --
-- -- (Loss) income from continuing operations before income taxes,
equity in net income of affiliated companies and minority interest
(2) 39 (92) 96 (Provision) benefit for income taxes (7) (8) 23 (13)
Equity in net income of affiliated companies, net of tax - 2 2 6
Minority interest in net income, net of tax (3) (6) 1 (15) -- --
--- --- (Loss) income from continuing operations $(12) $27 $(66)
$74 Loss from discontinued operations, net of tax (G) - - - - ----
--- ---- --- Net (loss) income $(12) $27 $(66) $74 ---- --- ----
--- Diluted (loss) earnings per share of common stock Continuing
operations $(0.19) $0.43 $(1.04) $1.16 Discontinued operations (G)
(0.01) - (0.01) - ----- --- ----- --- Net (loss) income per share
$(0.20) $0.43 $(1.05) $1.16 Weighted average common shares
outstanding Diluted 63 63 63 63 Note: During the third quarter of
fiscal 2008, management changed the way it manages the Company's
businesses. Accordingly, the segment results for all periods
presented have been revised to reflect these changes. (A) Royalty
income received by the Aerogel business, which has been included in
Unallocated and other in prior periods, has been reclassified to
Segment sales for all periods presented above. (B) Unallocated and
other reflects an elimination for sales of one equity affiliate,
prior to the consolidation of its results beginning April 1, 2008,
offset by royalties paid by equity affiliates and other operating
revenues and external shipping and handling fees. ( C ) Segment
profit is a measure used by Cabot's Chief Operating Decision-Maker
to measure consolidated operating results, assess segment
performance and allocate resources. Segment profit includes equity
in net income of affiliated companies, royalty income, minority
interest and allocated corporate costs. (D) Details of certain
items are presented in the Certain Items and Reconciliation of
Adjusted EPS table. (E) During the first quarter of fiscal 2009,
management changed the allocation method of its corporate costs to
its segments. Under this new method, costs that are not controlled
by the segments and which primarily benefit corporate interests are
not allocated to the segments. Prior periods have been recast to
conform to the new allocation method. (F) General unallocated
expense includes foreign currency transaction gains (losses),
interest income, and dividend income. (G) Amounts relate to legal
settlements in connection with our discontinued operations. Third
Quarter Earnings Announcement, Fiscal 2009 CABOT CORPORATION
CONSOLIDATED FINANCIAL POSITION
-------------------------------------------------------------------------
June 30, September 30, Dollars in millions, except share and per
2009 2008 share amounts (unaudited) (audited)
-------------------------------------------------------------------------
Current assets: Cash and cash equivalents $177 $129 Short-term
marketable securities 1 1 Accounts and notes receivable, net of
reserve for doubtful accounts of $7 and $5 417 646 Inventories: Raw
materials 121 193 Work in process 53 58 Finished goods 141 246
Other 31 26 -- -- Total inventories 346 523 Prepaid expenses and
other current assets 45 72 Deferred income taxes 35 30 Assets held
for sale - 7 --- --- Total current assets 1,021 1,408 ----- -----
Investments: Equity affiliates 57 53 Long-term marketable
securities and cost investments 1 1 --- --- Total investments 58 54
-- -- Property, plant and equipment 2,928 2,921 Accumulated
depreciation and amortization (1,913) (1,839) ------ ------ Net
property, plant and equipment 1,015 1,082 ----- ----- Other assets:
Goodwill 35 34 Intangible assets, net of accumulated amortization
of $11 and $11 3 3 Assets held for rent 46 45 Deferred income taxes
196 173 Other assets 97 59 -- -- Total other assets 377 314 --- ---
Total assets $2,471 $2,858 ====== ====== Third Quarter Earnings
Announcement, Fiscal 2009 CABOT CORPORATION CONSOLIDATED FINANCIAL
POSITION
--------------------------------------------------------------------------
June 30, September 30, Dollars in millions, except share and per
2009 2008 share amounts (unaudited) (audited)
--------------------------------------------------------------------------
Current liabilities: Notes payable to banks $19 $91 Accounts
payable and accrued liabilities 316 426 Income taxes payable 23 38
Deferred income taxes 4 7 Current portion of long-term debt 5 39
--- -- Total current liabilities 367 601 --- --- Long-term debt 551
586 Deferred income taxes 10 18 Other liabilities 286 294 Minority
interest 98 110 Stockholders' equity: Preferred stock: Authorized:
2,000,000 shares of $1 par value Issued: None and none - -
Outstanding: None and none Common stock: Authorized: 200,000,000
shares of $1 par value Issued: 64,109,606 and 65,403,100 shares 64
65 Outstanding: 64,015,510 and 65,277,715 shares Less cost of
94,096 and 125,385 shares of common treasury stock (3) (4)
Additional paid-in capital 13 21 Retained earnings 1,042 1,143
Deferred employee benefits (26) (30) Notes receivable for
restricted stock - (21) Accumulated other comprehensive income 69
75 -- -- Total stockholders' equity 1,159 1,249 ----- ----- Total
liabilities and stockholders' equity $2,471 $2,858 ====== ======
CABOT CORPORATION Fiscal 2008
--------------------------------------------------------------------
In millions, except per share amounts (unaudited) Dec. Q. Mar. Q.
June Q. Sept. Q. FY
--------------------------------------------------------------------
Sales Core Segment $463 $511 $537 $553 $2,064 Rubber blacks 410 454
499 505 1,868 Supermetals 53 57 38 48 196 Performance Segment 211
236 247 237 931 Performance products 141 164 175 165 645 Fumed
metal oxides 70 72 72 72 286 New Business Segment 10 14 14 20 58
Inkjet colorants 8 11 11 13 43 Aerogel (A) 1 2 2 5 10 Superior
MicroPowders 1 1 1 2 5 Specialty Fluids Segment 16 16 17 19 68
--------------------------------------------------------------------
Segment Sales 700 777 815 829 3,121 Unallocated and other (A), (B)
11 9 25 25 70
--------------------------------------------------------------------
Net sales and other operating revenues $711 $786 $840 $854 $3,191
--------------------------------------------------------------------
Segment Profit Core Segment $19 $29 $41 $18 $107 Rubber blacks 16
28 43 21 108 Supermetals 3 1 (2) (3) (1) Performance Segment 31 32
32 24 119 New Business Segment (12) (9) (9) (5) (35) Specialty
Fluids Segment 8 5 5 6 24
--------------------------------------------------------------------
Total Segment Profit (Loss) ( C ) 46 57 69 43 215 Interest expense
(9) (9) (9) (10) (37) Certain items (D) 10 (12) (8) (3) (13)
Unallocated corporate costs (E) (7) (10) (8) (3) (28) General
unallocated expense (F) (4) (1) (3) (10) (18) Less: Equity in net
income of affiliated companies, net of tax (2) (2) (2) (2) (8)
--------------------------------------------------------------------
Income (loss) before income taxes, equity in net income of
affiliated companies and minority interest 34 23 39 15 111 Benefit
(provision) for income taxes 6 (11) (8) (1) (14) Equity in net
income of affiliated companies, net of tax 2 2 2 2 8 Minority
interest in net income, net of tax (6) (3) (6) (5) (20)
--------------------------------------------------------------------
Income (loss) from continuing operations 36 11 27 11 85 Loss from
discontinued operations, net of tax (G) - - - - - Net income 36 11
27 11 85 Diluted earnings (loss) per share of common stock
Continuing operations $0.56 $0.17 $0.43 $0.18 $1.34 Discontinued
operations (G) - - - - -
--------------------------------------------------------------------
Net income (loss) $0.56 $0.17 $0.43 $0.18 $1.34 Weighted average
common shares outstanding Diluted 64 64 63 64 64
--------------------------------------------------------------------
Fiscal 2009
--------------------------------------------------------------------
In millions, except per share amounts (unaudited) Dec. Q. Mar. Q.
June Q. Sept. Q. FY
--------------------------------------------------------------------
Sales Core Segment $444 $295 $310 $1,049 Rubber blacks 399 272 272
943 Supermetals 45 23 38 106 Performance Segment 157 132 149 438
Performance products 105 90 98 293 Fumed metal oxides 52 42 51 145
New Business Segment 18 16 14 48 Inkjet colorants 13 9 10 32
Aerogel (A) 4 5 2 11 Superior MicroPowders 1 2 2 5 Specialty Fluids
Segment 15 11 19 45
--------------------------------------------------------------------
Segment Sales 634 454 492 1,580 Unallocated and other (A), (B) 18
16 19 53
--------------------------------------------------------------------
Net sales and other operating revenues $652 $470 $511 $1,633
--------------------------------------------------------------------
Segment Profit Core Segment $27 $(24) $14 $17 Rubber blacks 24 (17)
11 18 Supermetals 3 (7) 3 (1) Performance Segment 3 (1) 10 12 New
Business Segment (3) (1) (4) (8) Specialty Fluids Segment 4 4 9 17
--------------------------------------------------------------------
Total Segment Profit (Loss) ( C ) 31 (22) 29 38 Interest expense
(9) (8) (6) (23) Certain items (D) (2) (46) (19) (67) Unallocated
corporate costs (E) (7) (8) (7) (22) General unallocated expense
(F) (10) (7) 1 (16) Less: Equity in net income of affiliated
companies, net of tax (2) - - (2)
--------------------------------------------------------------------
Income (loss) before income taxes, equity in net income of
affiliated companies and minority interest 1 (91) (2) (92) Benefit
(provision) for income taxes (1) 31 (7) 23 Equity in net income of
affiliated companies, net of tax 2 - - 2 Minority interest in net
income, net of tax 2 2 (3) 1
--------------------------------------------------------------------
Income (loss) from continuing operations 4 (58) (12) (66) Loss from
discontinued operations, net of tax (G) - - - - Net income 4 (58)
(12) (66) Diluted earnings (loss) per share of common stock
Continuing operations $0.07 $(0.92) $(0.19) $(1.04) Discontinued
operations (G) - - (0.01) (0.01)
--------------------------------------------------------------------
Net income (loss) $0.07 $(0.92) $(0.20) $(1.05) Weighted average
common shares outstanding Diluted 64 63 63 63
--------------------------------------------------------------------
Note: During the third quarter of fiscal 2008, management changed
the way it manages the Company's businesses. Accordingly, the
segment results for all periods presented have been revised to
reflect these changes. (A) Royalty income received by the Aerogel
business, which has been included in Unallocated and other in prior
periods, has been reclassified to Segment sales for all periods
presented above. (B) Unallocated and other reflects an elimination
for sales of one equity affiliate, prior to the consolidation of
its results beginning April 1, 2008, offset by royalties paid by
equity affiliates and other operating revenues and external
shipping and handling fees. ( C ) Segment profit is a measure used
by Cabot's Chief Operating Decision-Maker to measure consolidated
operating results, assess segment performance and allocate
resources. Segment profit includes equity in net income of
affiliated companies, royalty income, minority interest and
allocated corporate costs. (D) Details of certain items are
presented in the Certain Items and Reconciliation of Adjusted EPS
table. (E) During the first quarter of fiscal 2009, management
changed the allocation method of its corporate costs to its
segments. Under this new method, costs that are not controlled by
the segments and which primarily benefit corporate interests are
not allocated to the segments. Prior periods have been recast to
conform to the new allocation method. (F) General unallocated
expense includes foreign currency transaction gains (losses),
interest income, and dividend income. (G) Amounts relate to legal
settlements in connection with our discontinued operations. Third
Quarter Earnings Announcement, Fiscal 2009 CABOT CORPORATION
CERTAIN ITEMS AND RECONCILIATION OF ADJUSTED EPS
-------------------------------------------------------------------------
Periods ended June 30 Three Months Nine Months
------------------------- ------------------------- Dollars in
millions, except per share amounts (unaudited) 2009 2008 2009 2008
per per per per 2009 share 2008 share 2009 share 2008 share $ (A) $
(A) $ (A) $ (A) ---------------------------------------------
------------------------- Certain items before income taxes
-------------- Environmental reserves and legal settlements $- -
$(2) $(0.03) - - $(3) $(0.04) CEO transition costs - - - - - - (4)
(0.04) Write-down of impaired investments - - - - (1) (0.01) - -
Restructuring initiatives: - 2008 Global - - (5) (0.05) (1) (0.01)
(5) (0.05) - 2009 Global (19) (0.25) - - (64) (0.87) - - - Altona,
Australia - - - - - - 18 0.20 - North America - - (1) (0.01) (2)
(0.02) (14) (0.16) - Europe (B) - - - - 1 0.01 (2) (0.02)
------------------------- ------------------------- Total certain
items (19) (0.25) (8) (0.09) (67) (0.90) (10) (0.11)
------------------------- ------------------------- - Discontinued
operations ( C ) - (0.01) - - - (0.01) - -
------------------------- ------------------------- Total certain
items and discontinued operations $(19) $(0.26) $(8) $(0.09) $(67)
$(0.91) $(10) $(0.11) -------------------------
------------------------- Tax impact of certain items and
discontinued operations 3 - 2 - 10 - 3 - -------------------------
------------------------- Total certain items and discontinued
operations after tax $(16) $(0.26) $(6) $(0.09) $(57) $(0.91) $(7)
$(0.11) ------------------------- -------------------------
------------------------------------------------------------
Periods ended June 30 Three Months Nine Months Dollars in millions
(unaudited) 2009 2008 2009 2008
------------------------------------------------------------
Statement of Operations Line Item ---------------------------------
Cost of sales (18) $(4) (59) $(1) Selling and administrative
expenses (1) (4) (6) (9) Research & Development - - (2) -
------------------------ Total certain items $(19) $(8) $(67) $(10)
------------------------ NON-GAAP MEASURE:
-------------------------------------------------------------------------
Periods ended June 30 Three Months Nine Months
--------------------- --------------------- Dollars in millions,
except per share amounts (unaudited) 2009 2008 2009 2008 per per
per per share(A) share(A) share(A) share(A)
-------------------------------------------------------------------------
Reconciliation of Adjusted EPS to GAAP EPS ----------------- Total
Diluted EPS $(0.20) $0.43 $(1.05) $1.16 Discontinued operations
(0.01) - (0.01) - ----- --- ----- --- Continuing operations $(0.19)
$0.43 $(1.04) $1.16 Certain items (0.25) (0.09) (0.90) (0.11) -----
----- ----- ----- Adjusted EPS $0.06 $0.52 $(0.14) $1.27 -----
----- ------ ----- (A) Per share amounts are calculated after tax.
(B) Benefit relates to former carbon black facilities. ( C )
Amounts relate to legal settlements in connection with our
discontinued operations
http://www.newscom.com/cgi-bin/prnh/20000323/CABOTLOGO
http://photoarchive.ap.org/ DATASOURCE: Cabot Corporation CONTACT:
Susannah Robinson, Director, Investor Relations, +1-617-342-6129,
Web Site: http://www.cabot-corp.com/
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