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Titanium dioxide demand continues to improve at Millennium
July 2003
Benelux and Germany, North and Latin America were steady and Asia maintained a strong performance. Clariant expects its operating performance for the second quarter to be on a par with the first quarter but forecasts for the rest of fiscal 2003 were deemed too unreliable because of the instability of the current economic situation. Contact: Clariant International Ltd, Rothausstrasse 61, CH-4132 Muttenz, Switzerland; tel: +41-61-469-6969; fax: +4161-469-6999; URL: www.clariant.com
Noveon posts 9% sales growth in first quarter For the quarter ended 31 March 2003, Noveon Inc reported sales of US$282.3 million, an increase of 9% on the figure of $259.4 million for the same quarter of the previous year. The sales growth reflected the strength of the Euro, the positive affect of acquisitions and higher volumes across most of the company’s product portfolio, with the exception of rubber chemicals and certain performance coatings products. Despite the growth in sales, first quarter EBITDA was down from $50.1 million in 2002 to $47.7 million in 2003, and net income down from $8.5 million to $5.3 million partly as a result of special charges related to restructuring and accounting changes. Excluding these special items, EBITDA for first quarter 2003 was $49.7 million and net income was $7.4 million. EBITDA was also adversely affected by significantly higher raw material and utility costs which more than offset higher volumes, continued manufacturing productivity and the strength of the Euro. Steve Demetriou, Noveon president and CEO, says that the company is pleased with its first quarter results in the face of the prevailing business environment and continued “unprecedented” increases in raw material costs, and comments that it is its fourth consecutive quarter of sales growth over the previous year. The Specialty Materials segment reported a sales increase of 7% from $98.1 million in first
Additives for Polymers
quarter 2002 to $104.7 million this year. Within this business area most product lines saw higher volumes; however, in polymer additives there were lower sales volumes of both rubber chemical and antioxidant product lines. EBITDA for the segment decreased by 3% or $1.0 million to $28.6 million in the first quarter. Elsewhere, Noveon’s Consumer Specialties segment reported a sales increase of 24% to $82.9 million for 2003’s first quarter and an increase in EBITDA of 15% to $18.0 million. For Performance Coatings, sales rose slightly to $94.7 million while EBITDA fell 20% to $16.0 million for the quarter. Contact: Noveon Inc, 9911 Brecksville Road, Cleveland, OH 44141, USA; tel: +1-216-4475000; URL: www.noveoninc.com
Titanium dioxide demand continues to improve at Millennium Operating income from New Jersey-based Millennium Chemicals’ majority owned businesses was US$29 million for the first three months of 2003, an improvement from $10 million in the first quarter of 2002 and $26 million in the fourth quarter of 2002. First quarter 2003 sales from those businesses were $415 million compared to $351 million in the first quarter of 2002. Overall, the company recorded a net loss of $51 million for the quarter, compared to a net loss of $337 million in the first quarter of 2002. The titanium dioxide (TiO2) segment reported first quarter operating income of $21 million, compared to $10 million in the first quarter last year and $17 million in the fourth quarter of 2002. Average first quarter prices increased 10% from the first quarter of 2002 in local currencies and 16% in US dollar terms. While the TiO2 sales volume of 145 000 tonnes for the quarter represents a decrease of 5% from the first quarter of 2002, it is up 2% from the fourth quarter of 2002. Volume was up sequentially in each of the three months of the first quarter of 2003, Millennium says. Sales revenues at $288 million for the quarter were up on both the first and last quarters of 2002.
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Additives for Polymers
The first quarter 2003 TiO2 operating rate was 88% of annual nameplate capacity of 690 000 tonnes compared to 81% in the first quarter of 2002, and 96% in the fourth quarter of 2002. Looking ahead, earnings are expected to improve in the second quarter of 2003 as sales volume should show a seasonal increase. Manufacturing costs per tonne are also expected to improve with higher operating rates and global TiO2 price increases should continue to be gradually realized, the company says. Millennium also manufactures acetyls and speciality chemicals and has a 29.5% stake in polymer producer Equistar. According to company chairman and CEO William M. Landuyt, Millennium recently conducted an outside independent review of its business plan, strategic options and competitive position. He reports that the findings confirm the attractiveness of the company’s larger businesses and affirm the importance of continuous improvement in cost structure while delivering improved value to customers. He says that resources will continue to be focused primarily on efforts to increase efficiency and improve profitability. Contact: Millennium Chemicals Inc, 230 Half Mile Road, PO Box 7015, Red Bank, NJ 07701, USA; tel: +1-732-933-5000; fax: +1-732-9335240; URL: www.millenniumchem.com
First quarter profit surge for Kerr-McGee Kerr-McGee Corp reported net income for the 2003 first quarter of US$69.9 million, far outstripping the figure of $5.5 million for the 2002 first quarter, with both chemicals and oil and gas businesses performing well. The company’s adjusted after-tax income was $127.3 million, compared with $10.9 million in the first quarter of 2002, boosted by higher oil and natural gas sales prices, higher natural gas sales volumes, and higher titanium dioxide (TiO2) pigment sales prices and volumes. Both businesses benefited from the company’s efforts to reduce unit production costs. Total sales revenue for the quarter was $1.127 billion, up 41% from $798.5 million largely because of high prices for crude oil and natural
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July 2003
gas. TiO2 pigment sales accounted for $253.3 million of the total, up 17% on the first quarter of 2002. Other chemicals netted sales of $50.3 million. Net operating profit for the pigments sector was $6.1 million for 2003’s first quarter, compared to a loss of $9.0 million in 2002. Kerr-McGee produced 130 000 tonnes of TiO2 pigment in the first three months of this year, up from 118 000 tonnes for the same period on 2002. Contact: Kerr-McGee Corp, PO Box 25861, Oklahoma City, OK 73125, USA; tel: +1-405775-5012; fax: +1-405-775-5027; URL: www.kerr-mcgee.com
Great Lakes announces 10% rise in first quarter 2003 net sales Great Lakes Chemical Corp has posted first quarter 2003 net sales from continuing operations of US$334 million, a 10% increase compared to $305 million reported in the corresponding period last year. Favourable foreign exchange rates, higher volumes and acquisitions were cited as the chief contributors. Quarterly income from continuing operations, before the cumulative effect of an accounting change, was $0.9 million, down from $5.1 million in 2002. Taking this issue and discontinued operations into account, the company recorded a net loss for the first quarter of $0.8 million, compared to a net loss of $1.5 million last year. Mark Bulriss, Great Lakes’ chairman, president and CEO, commented “Our performance in the first quarter was significantly affected by rapidly escalating raw material and energy costs. Productivity gains and our efforts to raise selling prices did not compensate for the sharply rising costs. The raw material and energy costs along with unfavourable foreign exchange impacted our earnings”. However, he expects performance to improve substantially in the second quarter due to the seasonality of the Specialty Products business even though a similar impact from raw materials and energy costs is anticipated. Cost control efforts will continue but the focus will remain on areas that will drive both higher growth rates and higher margins. Among the measures outlined was the
Benelux and Germany, North and Latin America were steady and Asia maintained a strong performance. Clariant expects its operating performance for the second quarter to be on a par with the first quarter but forecasts for the rest of fiscal 2003 were deemed too unreliable because of the instability of the current economic situation. Contact: Clariant International Ltd, Rothausstrasse 61, CH-4132 Muttenz, Switzerland; tel: +41-61-469-6969; fax: +4161-469-6999; URL: www.clariant.com
Noveon posts 9% sales growth in first quarter For the quarter ended 31 March 2003, Noveon Inc reported sales of US$282.3 million, an increase of 9% on the figure of $259.4 million for the same quarter of the previous year. The sales growth reflected the strength of the Euro, the positive affect of acquisitions and higher volumes across most of the company’s product portfolio, with the exception of rubber chemicals and certain performance coatings products. Despite the growth in sales, first quarter EBITDA was down from $50.1 million in 2002 to $47.7 million in 2003, and net income down from $8.5 million to $5.3 million partly as a result of special charges related to restructuring and accounting changes. Excluding these special items, EBITDA for first quarter 2003 was $49.7 million and net income was $7.4 million. EBITDA was also adversely affected by significantly higher raw material and utility costs which more than offset higher volumes, continued manufacturing productivity and the strength of the Euro. Steve Demetriou, Noveon president and CEO, says that the company is pleased with its first quarter results in the face of the prevailing business environment and continued “unprecedented” increases in raw material costs, and comments that it is its fourth consecutive quarter of sales growth over the previous year. The Specialty Materials segment reported a sales increase of 7% from $98.1 million in first
Additives for Polymers
quarter 2002 to $104.7 million this year. Within this business area most product lines saw higher volumes; however, in polymer additives there were lower sales volumes of both rubber chemical and antioxidant product lines. EBITDA for the segment decreased by 3% or $1.0 million to $28.6 million in the first quarter. Elsewhere, Noveon’s Consumer Specialties segment reported a sales increase of 24% to $82.9 million for 2003’s first quarter and an increase in EBITDA of 15% to $18.0 million. For Performance Coatings, sales rose slightly to $94.7 million while EBITDA fell 20% to $16.0 million for the quarter. Contact: Noveon Inc, 9911 Brecksville Road, Cleveland, OH 44141, USA; tel: +1-216-4475000; URL: www.noveoninc.com
Titanium dioxide demand continues to improve at Millennium Operating income from New Jersey-based Millennium Chemicals’ majority owned businesses was US$29 million for the first three months of 2003, an improvement from $10 million in the first quarter of 2002 and $26 million in the fourth quarter of 2002. First quarter 2003 sales from those businesses were $415 million compared to $351 million in the first quarter of 2002. Overall, the company recorded a net loss of $51 million for the quarter, compared to a net loss of $337 million in the first quarter of 2002. The titanium dioxide (TiO2) segment reported first quarter operating income of $21 million, compared to $10 million in the first quarter last year and $17 million in the fourth quarter of 2002. Average first quarter prices increased 10% from the first quarter of 2002 in local currencies and 16% in US dollar terms. While the TiO2 sales volume of 145 000 tonnes for the quarter represents a decrease of 5% from the first quarter of 2002, it is up 2% from the fourth quarter of 2002. Volume was up sequentially in each of the three months of the first quarter of 2003, Millennium says. Sales revenues at $288 million for the quarter were up on both the first and last quarters of 2002.
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Additives for Polymers
The first quarter 2003 TiO2 operating rate was 88% of annual nameplate capacity of 690 000 tonnes compared to 81% in the first quarter of 2002, and 96% in the fourth quarter of 2002. Looking ahead, earnings are expected to improve in the second quarter of 2003 as sales volume should show a seasonal increase. Manufacturing costs per tonne are also expected to improve with higher operating rates and global TiO2 price increases should continue to be gradually realized, the company says. Millennium also manufactures acetyls and speciality chemicals and has a 29.5% stake in polymer producer Equistar. According to company chairman and CEO William M. Landuyt, Millennium recently conducted an outside independent review of its business plan, strategic options and competitive position. He reports that the findings confirm the attractiveness of the company’s larger businesses and affirm the importance of continuous improvement in cost structure while delivering improved value to customers. He says that resources will continue to be focused primarily on efforts to increase efficiency and improve profitability. Contact: Millennium Chemicals Inc, 230 Half Mile Road, PO Box 7015, Red Bank, NJ 07701, USA; tel: +1-732-933-5000; fax: +1-732-9335240; URL: www.millenniumchem.com
First quarter profit surge for Kerr-McGee Kerr-McGee Corp reported net income for the 2003 first quarter of US$69.9 million, far outstripping the figure of $5.5 million for the 2002 first quarter, with both chemicals and oil and gas businesses performing well. The company’s adjusted after-tax income was $127.3 million, compared with $10.9 million in the first quarter of 2002, boosted by higher oil and natural gas sales prices, higher natural gas sales volumes, and higher titanium dioxide (TiO2) pigment sales prices and volumes. Both businesses benefited from the company’s efforts to reduce unit production costs. Total sales revenue for the quarter was $1.127 billion, up 41% from $798.5 million largely because of high prices for crude oil and natural
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July 2003
gas. TiO2 pigment sales accounted for $253.3 million of the total, up 17% on the first quarter of 2002. Other chemicals netted sales of $50.3 million. Net operating profit for the pigments sector was $6.1 million for 2003’s first quarter, compared to a loss of $9.0 million in 2002. Kerr-McGee produced 130 000 tonnes of TiO2 pigment in the first three months of this year, up from 118 000 tonnes for the same period on 2002. Contact: Kerr-McGee Corp, PO Box 25861, Oklahoma City, OK 73125, USA; tel: +1-405775-5012; fax: +1-405-775-5027; URL: www.kerr-mcgee.com
Great Lakes announces 10% rise in first quarter 2003 net sales Great Lakes Chemical Corp has posted first quarter 2003 net sales from continuing operations of US$334 million, a 10% increase compared to $305 million reported in the corresponding period last year. Favourable foreign exchange rates, higher volumes and acquisitions were cited as the chief contributors. Quarterly income from continuing operations, before the cumulative effect of an accounting change, was $0.9 million, down from $5.1 million in 2002. Taking this issue and discontinued operations into account, the company recorded a net loss for the first quarter of $0.8 million, compared to a net loss of $1.5 million last year. Mark Bulriss, Great Lakes’ chairman, president and CEO, commented “Our performance in the first quarter was significantly affected by rapidly escalating raw material and energy costs. Productivity gains and our efforts to raise selling prices did not compensate for the sharply rising costs. The raw material and energy costs along with unfavourable foreign exchange impacted our earnings”. However, he expects performance to improve substantially in the second quarter due to the seasonality of the Specialty Products business even though a similar impact from raw materials and energy costs is anticipated. Cost control efforts will continue but the focus will remain on areas that will drive both higher growth rates and higher margins. Among the measures outlined was the