A. SCHULMAN
Double-digit growth in Q1 net income / Europe struggles with lower volumes and currency effects / Sales in Americas and Asia boosted by acquisitions
Higher sales in the Americas and Asia-Pacific have boosted first-quarter results for US plastics compounder and distributor A. Schulman (Akron, Ohio; www.aschulman.com), compensating for a weaker performance in Europe. Foreign currency fluctuations have also had a negative impact on results. Adjusted net income from continuing operations for the first fiscal quarter of 2015 was 10.5% higher than the prior year at USD 18.5m (EUR 15.7m). Net sales increased by 5.5% year-on-year to reach USD 615.1m, although adverse foreign exchange rates made them USD 26.2m lower than they would have been.
President and CEO Bernard Rzepka said the company was pleased by the good start to fiscal 2015. “Our European team was able to maintain relatively flat results in a difficult economic landscape while our Americas and APAC regions more than offset the weakness in Europe,” he commented.
In Europe, the Middle East and Africa (EMEA), Q1 net sales fell by USD 21.3m, or 5.4%, versus the same period last year, to reach USD 371.2m. Foreign currency had a negative effect on net sales of USD 21.5m. Gross profit was USD 2.2m lower at USD 49.7m, mainly because of the impact from foreign currency, lower organic volumes and higher pension expense which were only partially offset by the contribution from the recent speciality plastics acquisition.
In contrast, net sales for the Americas rose by 30.3%, or USD 44.4m, year-on-year to total USD 190.9m and volumes were 19.8%, or almost 14,000 t, higher during the quarter, boosted by acquisitions and an improved product mix in its speciality powders portfolio. Gross profit increased by USD 8.8m, or 41%. Again, foreign exchange rates had a negative impact on sales of USD 4.2m.
The purchase of Australia’s Compco also contributed to higher net sales in Asia-Pacific (APAC) where they were up by 14.1%, or USD 6.6m, in Q1 compared with the same period in 2014. Volumes were higher by 19.8%, or more than 3,000 t. A. Schulman said Compco contributed net sales and volume of USD 3.4m and more than 1,000 t, respectively. Excluding Compco, organic volumes rose across nearly all product families but were partially offset by a lower price per pound as a result of market competition. Gross profit for APAC increased by USD 600,000, or 9.5%.
Looking ahead, Rzepka is expecting fiscal 2015 to be challenging. He said, “We are already seeing the adverse impact related to macro economic conditions and currency fluctuations. However, we will continue to aggressively focus on our acquisition strategy, proactive restructuring actions, and marketing initiatives which are gaining good traction to overcome economic events which are out of our control.”
The company plans to close its facility in Stryker, Ohio / USA in April (see Plasteurope.com of 20.11.2014) and will also cut 40 positions in Europe (see Plasteurope.com of 17.11.2014).
President and CEO Bernard Rzepka said the company was pleased by the good start to fiscal 2015. “Our European team was able to maintain relatively flat results in a difficult economic landscape while our Americas and APAC regions more than offset the weakness in Europe,” he commented.
In Europe, the Middle East and Africa (EMEA), Q1 net sales fell by USD 21.3m, or 5.4%, versus the same period last year, to reach USD 371.2m. Foreign currency had a negative effect on net sales of USD 21.5m. Gross profit was USD 2.2m lower at USD 49.7m, mainly because of the impact from foreign currency, lower organic volumes and higher pension expense which were only partially offset by the contribution from the recent speciality plastics acquisition.
In contrast, net sales for the Americas rose by 30.3%, or USD 44.4m, year-on-year to total USD 190.9m and volumes were 19.8%, or almost 14,000 t, higher during the quarter, boosted by acquisitions and an improved product mix in its speciality powders portfolio. Gross profit increased by USD 8.8m, or 41%. Again, foreign exchange rates had a negative impact on sales of USD 4.2m.
The purchase of Australia’s Compco also contributed to higher net sales in Asia-Pacific (APAC) where they were up by 14.1%, or USD 6.6m, in Q1 compared with the same period in 2014. Volumes were higher by 19.8%, or more than 3,000 t. A. Schulman said Compco contributed net sales and volume of USD 3.4m and more than 1,000 t, respectively. Excluding Compco, organic volumes rose across nearly all product families but were partially offset by a lower price per pound as a result of market competition. Gross profit for APAC increased by USD 600,000, or 9.5%.
Looking ahead, Rzepka is expecting fiscal 2015 to be challenging. He said, “We are already seeing the adverse impact related to macro economic conditions and currency fluctuations. However, we will continue to aggressively focus on our acquisition strategy, proactive restructuring actions, and marketing initiatives which are gaining good traction to overcome economic events which are out of our control.”
The company plans to close its facility in Stryker, Ohio / USA in April (see Plasteurope.com of 20.11.2014) and will also cut 40 positions in Europe (see Plasteurope.com of 17.11.2014).
12.01.2015 Plasteurope.com [230221-0]
Published on 12.01.2015
German version of this article...