A. SCHULMAN
Fiscal Q3 results improve despite foreign exchange impact / Citadel acquisition to boost revenues
US plastics compounder and distributor A. Schulman (Akron, Ohio; www.aschulman.com) has posted improved profits for the third quarter of fiscal 2015, despite a negative impact from foreign currency exchange. The improvement was largely the result of a better product mix but also reflected the acquisitions of Specialty Plastics and Compco.
Commenting on the results, president and CEO Bernard Rzepka said: “We continue to overcome the slow growth and foreign exchange environment by controlling what we can control and by focusing on our strategic initiatives and, as a result we were able to sequentially boost our gross margins across nearly every segment to deliver near record results.”
Adjusted operating income for quarter three was USD 32.8m (EUR 30.1m), a rise of about 15% compared with the corresponding period in 2014, while adjusted gross margin, as a percentage of net sales, improved to 16.2% compared with 14.3%.
In Europe, the Middle East and Africa (EMEA), and excluding the negative impact from foreign exchange, adjusted gross profit climbed by 10.9%, or USD 6.2m, to USD 51.7m. Net sales of USD 326.3m, however, were 1.9% lower (excluding foreign exchange effects), mostly due to lower volumes in the engineered plastics and distribution services segments, which were partially offset by double-digit volume growth in masterbatch solutions.
In contrast, net sales in the US and Canada rose by 4.1% year-on-year to USD 137.1m, while adjusted gross profits declined by USD 1.7m to USD 22.1m as the benefits of the Specialty Plastics acquisition were outweighed by an unfavourable product mix. In Latin America, however, improved operating costs and product mix boosted adjusted gross profits to USD 9.3m, a rise of USD 4.9m or 108.5% on the same quarter last year.
Net sales in the Asia-Pacific region reached USD 52.7m, an increase of USD 2.2m or 4.3% from the third quarter of 2014, with adjusted gross profit up by USD 700,000 to USD 7.8m.
The recently completed purchase of Citadel Plastics (Chicago, Illinois/ USA; www.citadelplastics.com) – see Plasteurope.com of 08.06.2015 – will nearly double A. Schulman’s revenue and achieve synergies of approximately USD 25m within 18 months. “This strategic acquisition greatly enhances our product scope, regional scale and efficiencies, and provides balance to our geographic footprint. With Citadel on board we are focused on leveraging the strength of the combined business, and expanding our growth potential,” said Rzepka.
“As we integrate Citadel, and meet or exceed our USD 25m synergy target, we are confident that the accretive nature of this acquisition, combined with our operating income growth, will provide a significant return to our shareholders,” he added.
Commenting on the results, president and CEO Bernard Rzepka said: “We continue to overcome the slow growth and foreign exchange environment by controlling what we can control and by focusing on our strategic initiatives and, as a result we were able to sequentially boost our gross margins across nearly every segment to deliver near record results.”
Adjusted operating income for quarter three was USD 32.8m (EUR 30.1m), a rise of about 15% compared with the corresponding period in 2014, while adjusted gross margin, as a percentage of net sales, improved to 16.2% compared with 14.3%.
In Europe, the Middle East and Africa (EMEA), and excluding the negative impact from foreign exchange, adjusted gross profit climbed by 10.9%, or USD 6.2m, to USD 51.7m. Net sales of USD 326.3m, however, were 1.9% lower (excluding foreign exchange effects), mostly due to lower volumes in the engineered plastics and distribution services segments, which were partially offset by double-digit volume growth in masterbatch solutions.
In contrast, net sales in the US and Canada rose by 4.1% year-on-year to USD 137.1m, while adjusted gross profits declined by USD 1.7m to USD 22.1m as the benefits of the Specialty Plastics acquisition were outweighed by an unfavourable product mix. In Latin America, however, improved operating costs and product mix boosted adjusted gross profits to USD 9.3m, a rise of USD 4.9m or 108.5% on the same quarter last year.
Net sales in the Asia-Pacific region reached USD 52.7m, an increase of USD 2.2m or 4.3% from the third quarter of 2014, with adjusted gross profit up by USD 700,000 to USD 7.8m.
The recently completed purchase of Citadel Plastics (Chicago, Illinois/ USA; www.citadelplastics.com) – see Plasteurope.com of 08.06.2015 – will nearly double A. Schulman’s revenue and achieve synergies of approximately USD 25m within 18 months. “This strategic acquisition greatly enhances our product scope, regional scale and efficiencies, and provides balance to our geographic footprint. With Citadel on board we are focused on leveraging the strength of the combined business, and expanding our growth potential,” said Rzepka.
“As we integrate Citadel, and meet or exceed our USD 25m synergy target, we are confident that the accretive nature of this acquisition, combined with our operating income growth, will provide a significant return to our shareholders,” he added.
21.07.2015 Plasteurope.com [231753-0]
Published on 21.07.2015
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