Milacron (NYSE:MZ)
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Milacron Inc. (NYSE: MZ) today reported a net loss in the fourth quarter
of 2007 of $73.4 million, or $14.66 per diluted share, caused primarily
by a non-cash writedown of deferred tax assets of $63.0 million
associated with the change of ownership of the majority of the company’s
preferred stock, as announced in October. The loss also included $7.4
million in restructuring charges, $1.9 million in one-time costs related
to the curtailment of the company’s U.S.
pension plan, as well as $1.4 million in expenses related to the
preferred stock transaction. This compared to a net loss in the fourth
quarter of 2006 of $8.6 million, or $2.25 per diluted share, which
included $5.1 million in restructuring costs and $1.8 million in
refinancing charges.
“We continue to make solid progress
throughout the company in terms of our restructuring and other cost
reduction initiatives,” Ronald D. Brown,
chairman, president and chief executive officer, said. “Our
manufacturing margins and operating cash flow or EBITDA (see
reconciliation table) are both up significantly from the year-ago
quarter. And our efforts to expand Milacron’s
presence in faster-growing markets of the world are also paying off. In
fact, our sales to markets outside the U.S., Canada and Western Europe
are up well in excess of 20% and now represent about 25% of our total
sales.”
These gains in non-traditional markets helped offset declines in North
America, as fourth quarter 2007 sales reached $217 million, up 10% from
$198 million in the year-ago quarter. About half of the sales increase
came as a result of favorable currency translation effects. New orders
in the quarter were $213 million, up from $203 million in 2006, entirely
due to currency translation.
Aided by favorable resolutions of long-standing product liability claims
and the benefits of restructuring and product cost reduction
initiatives, manufacturing margins in the quarter rose to 22.3%, up from
19.4% in the year ago quarter.
Net cash provided by operations during the quarter was $9.6 million,
compared to a use of cash by operations of $0.8 million in the fourth
quarter of 2006. At the end of the quarter, Milacron had $41 million in
cash, up $3 million from the beginning of the quarter. The company also
had $34 million in borrowing availability under its North American
revolving credit agreement, down from $42 million at the beginning of
the quarter.
Year 2007
Milacron’s net loss for the year was $88.8
million, or $19.59 per share. This included the writedown of tax assets
of $63.0 million, restructuring charges of $12.5 million, $1.9 million
in one-time costs for pension plan curtailment, as well as $1.9 million
in expenses for the preferred stock transaction. In 2006, Milacron lost
$39.7 million, or $10.15 per share, which included $17.4 million in
restructuring costs and $1.8 million in refinancing charges. Operating
earnings in 2007 improved to $3.1 million, up from a loss of $7.2
million in 2006.
Sales in 2007 fell to $808 million from $820 million in 2006, while new
orders were $826 million, down slightly from $828 million in the prior
year. 2007 sales and new orders were helped by approximately $29 million
in favorable currency translation effects.
Throughout 2007, Milacron faced severe declines in two of its largest
markets in North America: injection molding machinery and mold
technologies, which have been impacted by the shakeout in U.S. auto
parts suppliers and the decline in new housing starts. During the year,
however, restructuring measures helped reduce overall operating expenses
by $12 million, while global redesign and sourcing initiatives cut
product costs by $6 million. To further soften the impact of the
downturn in capital spending in North America, Milacron focused on
growing aftermarket sales, which approached $200 million and grew to
represent 36% of total machinery sales. The company also accelerated
efforts to further penetrate markets outside the U.S., Canada and
Western Europe. As a result, sales to these non-traditional markets rose
to $187 million in 2007, up 27% over 2006.
Continued cost reductions and efficiency improvements helped raise
manufacturing margins in 2007 to 20.2%, a significant increase over
18.5% in 2006.
Net cash provided by operations for the year was $9.6 million, compared
to a use of cash by operations of $19.2 million in 2006.
Segment Results
Machinery Technologies-North America [machinery
and related parts and services for injection molding, blow molding and
extrusion supplied from North America, India and China]
Despite favorable currency translation effects, new orders of $99
million were flat with those in the fourth quarter of 2006, while sales
fell to $92 million from $96 million reflecting soft demand for
injection molding equipment in North America, particularly from the
automotive sector. Blow molding equipment sales were off slightly, while
sales of extrusion systems and related parts and services continued to
rise, and machinery operations in India had record sales and profits. As
a result of the overall volume drop, segment earnings fell to $0.8
million, from $5.2 million in the year-ago quarter.
For the year 2007, new orders in this segment were $378 million, down
from $411 million in 2006. Sales also declined to $367 million from $402
million. Lower shipping volume and related under-absorption costs
reduced segment earnings to $11.3 million from $17.1 million in 2006.
Machinery Technologies-Europe [machinery
and related parts and services for injection molding and blow molding
supplied from Europe] Fourth quarter new
orders grew to $51 million from $40 million a year ago. Driven primarily
by strong demand from Eastern Europe, sales jumped to $60 million from
$37 million. Favorable currency translation effects accounted for
roughly half of the new order gains and one-quarter of the sales gains.
In local currencies, injection molding machine sales rose 18%, while
shipments of blow molding systems, aided by a large order, more than
doubled compared to the year-ago quarter. Volume gains, restructuring
benefits and disciplined pricing led to positive segment earnings of
$3.3 million compared to a loss of $0.6 million in the fourth quarter of
2006.
Aided in part by currency translation, segment new orders for the year
were $189 million, up considerably from $154 million in 2006, while
sales grew to $181 million, up from $153 million. Thanks to increased
shipments and cost-cutting measures, the segment had a major turnaround
in 2007, posting operating earnings of $3.3 million, compared to an
operating loss of $4.9 million a year ago.
Mold Technologies [mold
bases and related parts and services, as well as maintenance, repair and
operating (MRO) supplies for injection molding worldwide]
Sales in the fourth quarter of $38 million were flat with the year-ago
quarter but down 6% in local currencies, reflecting continued softness
in injection molding related businesses in North America. Restructuring,
cost cutting and increased global sourcing helped segment earnings grow
to $2.8 million from $0.8 million in the year-ago quarter. Earnings were
also helped by the recovery of a receivable related to a prior liability
claim.
Despite $5 million in currency translation gains, sales in 2007 fell to
$148 million, from $159 million in the prior year. Segment earnings for
the year were down, $1.9 million compared to $3.0 million in 2006.
Industrial Fluids [water-based
and oil-based coolants, lubricants and cleaners for metalcutting and
metalforming operations worldwide] Fourth
quarter sales were $31 million, flat with $29 million a year ago
excluding currency translation effects. Segment earnings improved to
$6.6 million from $4.1 million mainly due to the favorable resolution of
product liability claims.
Industrial fluid sales in 2007 were $124 million, compared to $117
million in 2006, mostly due to currency translation. Segment earnings
improved to $16.6 million from $10.8 million in 2006, reflecting
improved pricing, greater operating efficiency and lower product
liability costs.
Outlook
“The economic outlook for 2008 is mixed,”
said Brown. “We expect to see continued
growth in most of our markets outside of North America, particularly in
China, India and other faster-growing economies. Due to uncertainty in
the automotive and housing sectors, however, we are not anticipating any
market growth in North America.
“We entered the year with a solid backlog for
the first quarter. This should enable us to show significant
year-over-year improvement in sales and operating results compared to
the first quarter of 2007.
“We continue to work hard to make 2008 a
significantly better year for Milacron. In addition to improved
operating results from restructuring efforts, our cash flow will benefit
from the U.S. pension plan freeze we implemented at the end of last
year, from lower insurance costs going forward and from the ongoing sale
of redundant or non-core assets. We are also in the process of
negotiating an asset-based loan in Europe, which will increase our
overall liquidity,” Brown said.
Annual Meeting Date Set
Milacron’s board of directors set May 8, 2008
as the date of the annual meeting of shareholders to be held in
Cincinnati, Ohio, and March 12, 2008 as the record date for
determination of shareholders entitled to notice of and to vote at the
annual meeting.
Conference Call Today
Milacron will hold an open investor conference call today at 1 p.m.
Eastern Time, which can be accessed live at www.milacron.com.
For analysts and investors wishing to ask questions, the dial-in number
will be 719-785-9451 or toll-free 888-287-5420. A recording of the
conference call will be available starting 4:00 p.m. on February 25
through midnight March 9 on the company’s
website or by phone: 719-457-0820 or toll-free 888-203-1112 and
providing the access code: 1635249.
Note: Financial results in this release and accompanying tables
are preliminary, unaudited and subject to change until Milacron files
its Annual Report on Form 10-K with the Securities and Exchange
Commission, which it expects to do on or before March 31, 2008.
The forward-looking statements above by their nature involve risks and
uncertainties that could significantly impact operations, markets,
products and expected results. For further information please refer to
the Cautionary Statement included in the company’s
most recent Form 10-Q on file with the Securities and Exchange
Commission.
First incorporated in 1884, Milacron is a leading global supplier of
plastics-processing technologies and industrial fluids, with major
manufacturing facilities in North America, Europe and Asia. For further
information, visit www.milacron.com
or call the toll-free investor line: 800-909-MILA (800-909-6452).
Tables Attached
Milacron Inc. and Subsidiaries
Fourth Quarter 2007
Three Months Ended
Twelve Months Ended
December 31,
December 31,
2007
2006
2007
2006
Sales
$ 216,582,000
$ 197,457,000
$ 807,868,000
$ 820,101,000
Loss from continuing operations
(74,429,000
)
(8,693,000
)
(89,943,000
)
(39,785,000
)
Per Share
Basic
(14.86
)
(2.27
)
(19.82
)
(10.17
)
Diluted
(14.86
)
(2.27
)
(19.82
)
(10.17
)
Earnings from discontinued operations
1,037,000
64,000
1,172,000
81,000
Per Share
Basic
0.20
0.02
0.23
0.02
Diluted
0.20
0.02
0.23
0.02
Net loss
(73,392,000
)
(8,629,000
)
(88,771,000
)
(39,704,000
)
Per Share
Basic
(14.66
)
(2.25
)
(19.59
)
(10.15
)
Diluted
(14.66
)
(2.25
)
(19.59
)
(10.15
)
Common shares
Weighted average outstanding for basic EPS
5,167,000
4,869,000
5,008,000
4,833,000
Weighted average outstanding for diluted EPS
5,167,000
4,869,000
5,008,000
4,833,000
Outstanding at quarter end
5,486,000
5,232,000
5,486,000
5,232,000
Notes:
These statements are unaudited and subject to year-end adjustments.
The common share amounts, including the weighted average
outstanding shares upon which per-share amounts are based, include
the effect for the one-for-ten reverse stock split that became
effective on May 16, 2007.
Per-share amounts include accruals for preferred dividends and the
effect of a beneficial conversion feature.
Consolidated Earnings
Milacron Inc. and Subsidiaries
Fourth Quarter 2007
(In millions, except per-share data)
Three Months Ended
Twelve Months Ended
December 31,
December 31,
2007
2006
2007
2006
Sales
$ 216.6
$ 197.5
$ 807.9
$ 820.1
Cost of products sold
168.0
159.2
644.9
668.2
Cost of products sold related to restructuring
0.2
-
0.2
0.5
Total cost of products sold
168.2
159.2
645.1
668.7
Manufacturing margins
48.4
38.3
162.8
151.4
Percent of sales
22.3
%
19.4
%
20.2
%
18.5
%
Other costs and expenses
Selling and administrative
39.0
32.4
144.3
140.2
Restructuring costs
7.2
5.1
12.3
16.9
Change in preferred stock ownership costs
1.4
-
1.9
-
Pension plan curtailment cost
1.9
-
1.9
-
Refinancing costs
-
1.8
-
1.8
Other income - net
(0.6
)
0.1
(0.7
)
(0.3
)
Total other costs and expenses
48.9
39.4
159.7
158.6
Operating earnings (loss)
(0.5
)
(1.1
)
3.1
(7.2
)
Interest expense - net
(7.8
)
(7.7
)
(31.4
)
(30.0
)
Loss from continuing operations before income taxes
(8.3
)
(8.8
)
(28.3
)
(37.2
)
Provision (benefit) for income taxes (a)
66.1
(0.1
)
61.7
2.6
Loss from continuing operations
(74.4
)
(8.7
)
(90.0
)
(39.8
)
Discontinued operations - net of income taxes (b)
1.0
0.1
1.2
0.1
Net loss
$ (73.4
)
$ (8.6
)
$ (88.8
)
$ (39.7
)
Loss per common share - basic and diluted
Continuing operations
$ (14.86
)
$ (2.27
)
$ (19.82
)
$ (10.17
)
Discontinued operations
0.20
0.02
0.23
0.02
Net loss
$ (14.66
)
$ (2.25
)
$ (19.59
)
$ (10.15
)
(a) In 2007, includes a $63 million non-cash charge associated
with the change in ownership of a majority of the company's Series
B Preferred Stock, as announced in October, 2007.
(b) Represents adjustments of reserves related to prior divestitures.
Notes:
These statements are unaudited and subject to year-end adjustments.
The weighted average outstanding shares upon which per-share
amounts are based include the effect for the one-for-ten reverse
stock split that became effective on May 16, 2007.
Per-share amounts include accruals for preferred dividends and
effect of beneficial conversion feature.
Consolidated Balance Sheets
Milacron Inc. and Subsidiaries
Fourth Quarter 2007
(In millions)
December 31,
December 31,
2007
2006
Assets
Cash and cash equivalents
$ 40.8
$ 38.5
Notes and accounts receivable-net
115.1
114.5
Inventories
179.7
170.7
Other current assets
24.4
41.9
Total current assets
360.0
365.6
Property, plant and equipment - net
106.4
114.3
Goodwill
90.5
87.3
Other noncurrent assets
36.0
83.3
Total assets
$ 592.9
$ 650.5
Liabilities and shareholders' deficit
Short-term borrowings and long-term debt due within one year (a)
$ 29.0
$ 27.7
Trade accounts payable and advance billings and deposits
121.5
102.2
Accrued and other current liabilities
68.2
82.6
Total current liabilities
218.7
212.5
Long-term accrued liabilities
193.4
226.5
Long-term debt
231.9
232.8
Shareholders' deficit
(51.1
)
(21.3
)
Total liabilities and shareholders' deficit
$ 592.9
$ 650.5
(a) In 2007, $24.0 million was drawn against the revolving credit
facility and in 2006, $23 million was drawn against the revolving
credit facility. Outstanding letters of credit were $8.0 million
in 2007 and 2006.
Note: These statements are unaudited and subject to year-end
adjustments.
Consolidated Cash Flows
Milacron Inc. and Subsidiaries
Fourth Quarter 2007
(In millions)
Three Months Ended
Twelve Months Ended
December 31,
December 31,
2007
2006
2007
2006
Increase (decrease) in cash and cash equivalents
Operating activities cash flows
Net loss
$ (73.4
)
$ (8.6
)
$ (88.8
)
$ (39.7
)
Discontinued operations - net of income taxes
(1.0
)
(0.1
)
(1.2
)
(0.1
)
Depreciation and amortization
4.1
4.3
16.1
16.8
Restructuring costs
8.9
3.3
10.2
8.2
Working capital changes
Notes and accounts receivable
7.7
5.5
3.3
7.9
Inventories
5.8
10.0
(4.4
)
(4.5
)
Other current assets
0.9
(0.9
)
(3.7
)
2.1
Trade accounts payable
2.7
(0.5
)
11.7
(1.7
)
Other current liabilities
(13.8
)
(10.6
)
(10.9
)
(2.0
)
Deferred income taxes and other - net
67.7
(3.2
)
77.3
(6.2
)
Net cash provided (used) by operating activities
9.6
(0.8
)
9.6
(19.2
)
Investing activities cash flows
Capital expenditures
(3.6
)
(3.5
)
(9.6
)
(13.8
)
Net disposals of property, plant and equipment
0.1
0.8
0.3
2.9
Net cash used by investing activities
(3.5
)
(2.7
)
(9.3
)
(10.9
)
Financing activities cash flows
Repayments of long-term debt
(1.0
)
(0.2
)
(1.6
)
(1.6
)
Increase (decrease) in short-term borrowings
(2.3
)
5.7
1.0
21.2
Dividends paid
-
(0.1
)
(0.2
)
(0.2
)
Net cash provided (used) by financing activities
(3.3
)
5.4
(0.8
)
19.4
Effect of exchange rate fluctuations on cash and cash
equivalents
0.5
0.9
2.8
3.5
Increase (decrease) in cash and cash equivalents
3.3
2.8
2.3
(7.2
)
Cash and cash equivalents at beginning of period
37.5
35.7
38.5
45.7
Cash and cash equivalents at end of period
$ 40.8
$ 38.5
$ 40.8
$ 38.5
Note: These statements are unaudited and subject to year-end
adjustments.
Segment and Supplemental Information
Milacron Inc. and Subsidiaries
Fourth Quarter 2007
(In millions)
Three Months Ended
Twelve Months Ended
December 31,
December 31,
2007
2006
2007
2006
Machinery technologies North America
Sales
$ 91.5
$ 95.7
$ 367.0
$ 402.4
Operating cash flow (a)
2.1
6.8
17.1
23.2
Segment earnings
0.8
5.2
11.3
17.1
Percent of sales
0.9
%
5.4
%
3.1
%
4.2
%
New orders
98.8
98.8
378.2
411.0
Machinery technologies Europe
Sales
$ 60.4
$ 37.4
$ 180.5
$ 153.4
Operating cash flow (a)
4.5
0.4
7.3
(1.1
)
Segment earnings (loss)
3.3
(0.6
)
3.3
(4.9
)
Percent of sales
5.5
%
-1.6
%
1.8
%
-3.2
%
New orders
50.5
40.3
188.5
154.1
Mold technologies
Sales
$ 37.6
$ 37.8
$ 148.2
$ 158.8
Operating cash flow (a)
3.9
2.0
6.4
8.2
Segment earnings (loss)
2.8
0.8
1.9
3.0
Percent of sales
7.4
%
2.1
%
1.3
%
1.9
%
New orders
37.2
37.9
147.8
157.8
Eliminations
Sales
$ (4.2
)
$ (2.8
)
$ (11.8
)
$ (12.0
)
New orders
(4.6
)
(3.4
)
(12.9
)
(11.6
)
Total plastics technologies
Sales
$ 185.3
$ 168.1
$ 683.9
$ 702.6
Operating cash flow (a)
10.5
9.2
30.8
30.3
Segment earnings
6.9
5.4
16.5
15.2
Percent of sales
3.7
%
3.2
%
2.4
%
2.2
%
New orders
181.9
173.6
701.6
711.3
Industrial fluids
Sales
$ 31.3
$ 29.4
$ 124.0
$ 117.5
Operating cash flow (a)
7.0
4.5
18.2
12.3
Segment earnings
6.6
4.1
16.6
10.8
Percent of sales
21.1
%
13.9
%
13.4
%
9.2
%
New orders
31.3
29.4
124.0
117.5
Total continuing operations
Sales
$ 216.6
$ 197.5
$ 807.9
$ 820.1
Operating cash flow (a)
14.3
10.1
35.5
28.8
Segment earnings
13.5
9.5
33.1
26.0
Restructuring costs
(7.4
)
(5.1
)
(12.5
)
(17.4
)
Change in preferred stock ownership costs
(1.4
)
-
(1.9
)
-
Pension plan curtailment cost
(1.9
)
-
(1.9
)
-
Corporate expenses
(3.2
)
(3.6
)
(13.3
)
(13.6
)
Other unallocated expenses
(0.1
)
(1.9
)
(0.4
)
(2.2
)
Operating earnings (loss)
(0.5
)
(1.1
)
3.1
(7.2
)
Percent of sales
-0.2
%
-0.6
%
0.4
%
-0.9
%
New orders
213.2
203.0
825.6
828.8
Ending backlog
129.1
105.7
129.1
105.7
(a) Represents EBITDA (earnings before interest, income taxes,
depreciation and amortization) before restructuring costs.
Note: These statements are unaudited and subject to year-end
adjustments.
Reconciliation of Earnings to Operating Cash Flows
Milacron Inc. and Subsidiaries
Fourth Quarter 2007
(In millions)
Three Months Ended
Twelve Months Ended
December 31,
December 31,
2007
2006
2007
2006
Machinery technologies North America
Segment earnings
$ 0.8
$ 5.2
$ 11.3
$ 17.1
Depreciation and amortization
1.3
1.6
5.8
6.1
Operating cash flow
2.1
6.8
17.1
23.2
Machinery technologies Europe
Segment earnings (loss)
$ 3.3
$ (0.6
)
$ 3.3
$ (4.9
)
Depreciation and amortization
1.2
1.0
4.0
3.8
Operating cash flow
4.5
0.4
7.3
(1.1
)
Mold technologies
Segment earnings (loss)
$ 2.8
$ 0.8
$ 1.9
$ 3.0
Depreciation and amortization
1.1
1.2
4.5
5.2
Operating cash flow
3.9
2.0
6.4
8.2
Total plastics technologies
Segment earnings
$ 6.9
$ 5.4
$ 16.5
$ 15.2
Depreciation and amortization
3.6
3.8
14.3
15.1
Operating cash flow
10.5
9.2
30.8
30.3
Industrial fluids
Segment earnings
$ 6.6
$ 4.1
$ 16.6
$ 10.8
Depreciation and amortization
0.4
0.4
1.6
1.5
Operating cash flow
7.0
4.5
18.2
12.3
Total continuing operations
Net loss
$ (73.4
)
$ (8.6
)
$ (88.8
)
$ (39.7
)
Discontinued operations - net of income taxes (a)
(1.0
)
(0.1
)
(1.2
)
(0.1
)
Provision (benefit) for income taxes (b)
66.1
(0.1
)
61.7
2.6
Interest expense - net
7.8
7.7
31.4
30.0
Restructuring costs
7.4
5.1
12.5
17.4
Change in preferred stock ownership costs
1.4
-
1.9
-
Pension plan curtailment cost
1.9
-
1.9
-
Refinancing costs
-
1.8
-
1.8
Depreciation and amortization
4.1
4.3
16.1
16.8
Operating cash flow
$ 14.3
$ 10.1
$ 35.5
$ 28.8
(a) Represents adjustments of reserves related to prior divestitures.
(b) In 2007, includes a $63 million non-cash charge associated
with the change in ownership of a majority of the company's Series
B Preferred Stock, as announced in October, 2007.
Note: These statements are unaudited and subject to year-end
adjustments.
Historical Information
(In millions, except per-share data)
2005
2006
2007
Qtr 1
Qtr 2
Qtr 3
Qtr 4
Year
Qtr 1
Qtr 2
Qtr 3
Qtr 4
Year
Qtr 1
Qtr 2
Qtr 3
Qtr 4
Year
Sales
$ 192.3
$ 208.8
$ 190.7
$ 217.1
$ 808.9
$ 202.4
$ 211.1
$ 209.1
$ 197.5
$ 820.1
$ 190.3
$ 197.3
$ 203.7
$ 216.6
$ 807.9
Cost of products sold
160.1
171.0
157.3
174.7
663.1
168.8
170.4
169.8
159.2
668.2
154.8
158.6
163.5
168.0
644.9
Cost of products sold related to restructuring
-
-
-
-
-
-
0.4
0.1
-
0.5
-
-
-
0.2
0.2
Total cost of products sold
160.1
171.0
157.3
174.7
663.1
168.8
170.8
169.9
159.2
668.7
154.8
158.6
163.5
168.2
645.1
Manufacturing margins
32.2
37.8
33.4
42.4
145.8
33.6
40.3
39.2
38.3
151.4
35.5
38.7
40.2
48.4
162.8
Other costs and expenses
Selling and administrative
33.5
33.7
31.3
35.3
133.8
34.2
38.3
35.3
32.4
140.2
35.3
34.9
35.1
39.0
144.3
Refinancing costs (a)
-
-
-
-
-
-
-
-
1.8
1.8
-
-
-
-
-
Restructuring costs (b)
0.4
0.3
0.1
0.8
1.6
0.6
8.4
2.8
5.1
16.9
2.4
1.5
1.2
7.2
12.3
Change in preferred stock ownership costs
-
-
-
-
-
-
-
-
-
-
-
-
0.5
1.4
1.9
Pension plan curtailment cost
-
-
-
-
-
-
-
-
-
-
-
-
-
1.9
1.9
Other - net
(1.0
)
0.2
1.3
(0.1
)
0.4
(0.1
)
(0.9
)
0.6
0.1
(0.3
)
(0.2
)
(0.3
)
0.4
(0.6
)
(0.7
)
Total other costs and expenses
32.9
34.2
32.7
36.0
135.8
34.7
45.8
38.7
39.4
158.6
37.5
36.1
37.2
48.9
159.7
Operating earnings (loss)
(0.7
)
3.6
0.7
6.4
10.0
(1.1
)
(5.5
)
0.5
(1.1
)
(7.2
)
(2.0
)
2.6
3.0
(0.5
)
3.1
Interest expense - net
(8.2
)
(7.0
)
(7.7
)
(7.4
)
(30.3
)
(7.6
)
(7.9
)
(6.8
)
(7.7
)
(30.0
)
(7.7
)
(7.9
)
(8.0
)
(7.8
)
(31.4
)
Loss from continuing operations before income taxes
(8.9
)
(3.4
)
(7.0
)
(1.0
)
(20.3
)
(8.7
)
(13.4
)
(6.3
)
(8.8
)
(37.2
)
(9.7
)
(5.3
)
(5.0
)
(8.3
)
(28.3
)
Provision (benefit) from income taxes (c)
0.2
1.0
0.6
(5.6
)
(3.8
)
0.9
0.9
0.9
(0.1
)
2.6
1.0
(4.9
)
(0.5
)
66.1
61.7
Earnings (loss) from continuing operations
(9.1
)
(4.4
)
(7.6
)
4.6
(16.5
)
(9.6
)
(14.3
)
(7.2
)
(8.7
)
(39.8
)
(10.7
)
(0.4
)
(4.5
)
(74.4
)
(90.0
)
Discontinued operations - net of income taxes (d)
Net gain (loss) on divestitures
-
0.6
0.7
1.2
2.5
-
-
-
0.1
0.1
(0.1
)
0.3
-
1.0
1.2
Total discontinued operations
-
0.6
0.7
1.2
2.5
-
-
-
0.1
0.1
(0.1
)
0.3
-
1.0
1.2
Net earnings (loss)
$ (9.1
)
$ (3.8
)
$ (6.9
)
$ 5.8
$ (14.0
)
$ (9.6
)
$ (14.3
)
$ (7.2
)
$ (8.6
)
$ (39.7
)
$ (10.8
)
$ (0.1
)
$ (4.5
)
$ (73.4
)
$ (88.8
)
Earnings (loss) per common share
Basic
Continuing operations
$ (2.24
)
$ (1.24
)
$ (1.92
)
$ 0.62
$ (4.77
)
$ (2.49
)
$ (3.45
)
$ (1.97
)
$ (2.27
)
$ (10.17
)
$ (2.66
)
$ (0.55
)
$ (1.36
)
$ (14.86
)
$ (19.82
)
Discontinued operations
-
0.12
0.15
0.26
0.53
-
-
-
0.02
0.02
(0.02
)
0.05
-
0.20
0.23
Net earnings (loss)
$ (2.24
)
$ (1.12
)
$ (1.77
)
$ 0.88
$ (4.24
)
$ (2.49
)
$ (3.45
)
$ (1.97
)
$ (2.25
)
$ (10.15
)
$ (2.68
)
$ (0.50
)
$ (1.36
)
$ (14.66
)
$ (19.59
)
Diluted
Continuing operations
$ (2.24
)
$ (1.24
)
$ (1.92
)
$ 0.42
$ (4.77
)
$ (2.49
)
$ (3.45
)
$ (1.97
)
$ (2.27
)
$ (10.17
)
$ (2.66
)
$ (0.55
)
$ (1.36
)
$ (14.86
)
$ (19.82
)
Discontinued operations
-
0.12
0.15
0.12
0.53
-
-
-
0.02
0.02
(0.02
)
0.05
-
0.20
0.23
Net earnings (loss)
$ (2.24
)
$ (1.12
)
$ (1.77
)
$ 0.54
$ (4.24
)
$ (2.49
)
$ (3.45
)
$ (1.97
)
$ (2.25
)
$ (10.15
)
$ (2.68
)
$ (0.50
)
$ (1.36
)
$ (14.66
)
$ (19.59
)
(a) In 2006, represents the write-off of unamortized deferred
refinancing fees.
(b) In 2006 and 2007, relates principally to costs for the
consolidation of the global mold technologies and European
plastics machinery businesses to reduce their cost structures and
improve customer service. In 2005, represents costs related to
initiatives to reduce operating and administrative costs.
(c) In 2007, includes a $63 million non-cash charge associated with
the change in ownership of a majority of the company's Series B
Preferred Stock, as announced in October, 2007.
(d) All years, represents adjustments of reserves related to prior
divestitures.
Notes:
These statements are unaudited and subject to year-end adjustments.
The weighted average outstanding shares upon which per-share amounts
are based include the effect for the one-for-ten reverse stock split
that became effective on May 16, 2007.
Per-share amounts include accruals for preferred dividends and
effect of beneficial conversion feature.
Historical Segment and Supplemental Information
(In Millions)
2005
2006
2007
Qtr 1
Qtr 2
Qtr 3
Qtr 4
Year
Qtr 1
Qtr 2
Qtr 3
Qtr 4
Year
Qtr 1
Qtr 2
Qtr 3
Qtr 4
Year
Machinery technologies North America
Sales
$ 87.1
$ 95.4
$ 86.7
$ 107.3
$ 376.5
$ 94.1
$ 106.9
$ 105.7
$ 95.7
$ 402.4
$ 91.1
$ 91.5
$ 92.9
$ 91.5
$ 367.0
Operating cash flow (a)
3.5
6.5
5.8
7.8
23.6
2.9
6.0
7.5
6.8
23.2
3.4
6.5
5.1
2.1
17.1
Segment earnings
1.9
4.9
4.3
6.2
17.3
1.4
4.5
6.0
5.2
17.1
1.8
4.9
3.8
0.8
11.3
New orders
94.9
100.7
89.2
97.9
382.7
114.0
92.5
105.7
98.8
411.0
97.9
90.1
91.4
98.8
378.2
Machinery technologies Europe
Sales
$ 34.3
$ 41.5
$ 36.8
$ 36.9
$ 149.5
$ 36.3
$ 39.9
$ 39.8
$ 37.4
$ 153.4
$ 34.4
$ 40.2
$ 45.5
$ 60.4
$ 180.5
Operating cash flow (a)
(1.2
)
0.6
(0.5
)
0.4
(0.7
)
(1.6
)
(0.2
)
0.3
0.4
(1.1
)
(0.2
)
1.2
1.8
4.5
7.3
Segment earnings (loss)
(2.2
)
(0.5
)
(1.5
)
(0.8
)
(5.0
)
(2.4
)
(1.2
)
(0.7
)
(0.6
)
(4.9
)
(1.2
)
0.3
0.9
3.3
3.3
New orders
35.4
42.7
34.2
40.3
152.6
40.0
42.9
30.9
40.3
154.1
46.6
45.1
46.3
50.5
188.5
Mold technologies
Sales
$ 44.2
$ 44.4
$ 40.6
$ 44.2
$ 173.4
$ 44.4
$ 38.9
$ 37.7
$ 37.8
$ 158.8
$ 37.9
$ 35.8
$ 36.9
$ 37.6
$ 148.2
Operating cash flow (a)
3.7
2.1
0.7
3.4
9.9
3.3
1.6
1.3
2.0
8.2
1.4
0.3
0.8
3.9
6.4
Segment earnings (loss)
2.3
0.7
(0.7
)
1.6
3.9
1.9
0.3
-
0.8
3.0
0.3
(0.8
)
(0.4
)
2.8
1.9
New orders
45.1
43.4
40.7
44.5
173.7
43.7
38.5
37.7
37.9
157.8
36.7
36.5
37.4
37.2
147.8
Eliminations
Sales
$ (0.3
)
$ (0.6
)
$ (0.5
)
$ (1.3
)
$ (2.7
)
$ (2.1
)
$ (3.9
)
$ (3.2
)
$ (2.8
)
$ (12.0
)
$ (2.8
)
$ (2.4
)
$ (2.4
)
$ (4.2
)
$ (11.8
)
New orders
(0.4
)
(0.5
)
(0.4
)
(1.0
)
(2.3
)
(2.3
)
(3.2
)
(2.7
)
(3.4
)
(11.6
)
(2.8
)
(2.1
)
(3.4
)
(4.6
)
(12.9
)
Total plastics technologies
Sales
$ 165.3
$ 180.7
$ 163.6
$ 187.1
$ 696.7
$ 172.7
$ 181.8
$ 180.0
$ 168.1
$ 702.6
$ 160.6
$ 165.1
$ 172.9
$ 185.3
$ 683.9
Operating cash flow (a)
6.0
9.2
6.0
11.6
32.8
4.6
7.4
9.1
9.2
30.3
4.6
8.0
7.7
10.5
30.8
Segment earnings
2.0
5.1
2.1
7.0
16.2
0.9
3.6
5.3
5.4
15.2
0.9
4.4
4.3
6.9
16.5
New orders
175.0
186.3
163.7
181.7
706.7
195.4
170.7
171.6
173.6
711.3
178.4
169.6
171.7
181.9
701.6
Industrial fluids
Sales
$ 27.0
$ 28.1
$ 27.1
$ 30.0
$ 112.2
$ 29.7
$ 29.3
$ 29.1
$ 29.4
$ 117.5
$ 29.7
$ 32.2
$ 30.8
$ 31.3
$ 124.0
Operating cash flow (a)
1.9
2.4
2.2
3.9
10.4
2.3
3.3
2.2
4.5
12.3
3.6
3.6
4.0
7.0
18.2
Segment earnings
1.4
1.9
1.8
3.6
8.7
1.9
2.9
1.9
4.1
10.8
3.3
3.2
3.5
6.6
16.6
New orders
27.0
28.2
27.1
29.8
112.1
29.7
29.3
29.1
29.4
117.5
29.7
32.2
30.8
31.3
124.0
Total continuing operations
Sales
$ 192.3
$ 208.8
$ 190.7
$ 217.1
$ 808.9
$ 202.4
$ 211.1
$ 209.1
$ 197.5
$ 820.1
$ 190.3
$ 197.3
$ 203.7
$ 216.6
$ 807.9
Operating cash flow (a)
4.2
8.5
5.2
12.1
30.0
3.6
7.5
7.6
10.1
28.8
4.4
8.2
8.6
14.3
35.5
Segment earnings
3.4
7.0
3.9
10.6
24.9
2.8
6.5
7.2
9.5
26.0
4.2
7.6
7.8
13.5
33.1
Restructuring costs (b)
(0.4
)
(0.3
)
(0.1
)
(0.8
)
(1.6
)
(0.6
)
(8.8
)
(2.9
)
(5.1
)
(17.4
)
(2.4
)
(1.5
)
(1.2
)
(7.4
)
(12.5
)
Change in preferred stock ownership costs
-
-
-
-
-
-
-
-
-
-
-
-
(0.5
)
(1.4
)
(1.9
)
Pension plan curtailment cost
-
-
-
-
-
-
-
-
-
-
-
-
-
(1.9
)
(1.9
)
Corporate expenses
(3.5
)
(3.0
)
(3.0
)
(3.3
)
(12.8
)
(3.3
)
(3.1
)
(3.6
)
(3.6
)
(13.6
)
(3.7
)
(3.4
)
(3.0
)
(3.2
)
(13.3
)
Other unallocated expenses (c)
(0.2
)
(0.1
)
(0.1
)
(0.1
)
(0.5
)
-
(0.1
)
(0.2
)
(1.9
)
(2.2
)
(0.1
)
(0.1
)
(0.1
)
(0.1
)
(0.4
)
Operating earnings (loss)
(0.7
)
3.6
0.7
6.4
10.0
(1.1
)
(5.5
)
0.5
(1.1
)
(7.2
)
(2.0
)
2.6
3.0
(0.5
)
3.1
Percent of sales
-0.4
%
1.7
%
0.4
%
2.9
%
1.2
%
-0.5
%
-2.6
%
0.2
%
-0.6
%
-0.9
%
-1.1
%
1.3
%
1.5
%
-0.2
%
0.4
%
New orders
202.0
214.5
190.8
211.5
818.8
225.1
200.0
200.7
203.0
828.8
208.1
201.8
202.5
213.2
825.6
Ending backlog
96.0
99.2
99.6
92.7
92.7
116.2
106.8
98.5
105.7
105.7
126.6
132.1
131.2
129.1
129.1
(a) Represents EBITDA (earnings before interest, income taxes,
depreciation and amortization) before restructuring costs.
(b) In 2006 and 2007, relates principally to costs for the
consolidation of the global mold technologies and European
plastics machinery businesses to reduce their cost structures and
improve customer service. In 2005, represents costs related to
initiatives to reduce operating and administrative costs.
(c) In fourth quarter 2006, includes $1.7 million for writing-off
unamortized deferred refinancing fees.
Note: These statements are unaudited and subject to year-end
adjustments.
Updated: February 25, 2007
Note: The amounts below are approximate working estimates,
around which an even wider range of numbers could be used for
financial modeling purposes. These estimates, by their nature,
involve a great number of risks and uncertainties. Actual results
may differ as these risks and uncertainties could significantly
impact the company's markets, products, and operations. For further
information please refer to the Cautionary Statement included in
Item 2 of the company's most recent Form 10-Q on file with the
Securities and Exchange Commission.
Quarter Ended
(In millions)
March 31, 2008
Projected profit & loss items
Sales (1)
$200 - 212
Total plastics technologies
170 - 180
Industrial fluids
30 - 32
Segment earnings
Total plastics technologies
2 - 4
Industrial fluids
2.5 - 3.5
Corporate expenses
4.5 - 3.5
Interest expense - net
8.5 - 7.5
Provision for (benefit from) income taxes
0 - 1
Restructuring costs
1 - 2
Net earnings (loss) after tax (2)
(11.5) - (4.5)
Average shares outstanding - basic
5
Average shares outstanding - diluted
11
Earnings per share (3)
($2.70) - ($1.30)
Projected cash flow & balance sheet items
Depreciation and amortization
3 - 4
Primary working capital - increase (4)
4 - 8
Cash pension contribution
0
Capital expenditures, net
3 - 4
Cash interest
less than 1
Cash dividends
less than 1
Cash tax
less than 1
Cash refinancing fees
1 - 2
Cash restructuring
1 - 2
1
Quarter ended March 31, 2008 increased approximately $8 million
over the same period a year ago due to the strengthening of the
Euro.
2
Includes $0.6 million of non-cash expense related to the U.S.
defined benefit plan in quarter ended March 31, 2008.
3
Per share amounts include accruals for preferred dividends and
effect of beneficial conversion feature.
4
Inventory + receivables - trade payables - advance billings
Comments & explanations
Assumes quarter ended December 31, 2007 foreign exchange rates
(e.g., USD/EUR = 1.4384), and no further acquisitions or
divestitures.