A. Schulman Reports Increase in Second Quarter Net Income.AKRON Akron (ăk`rən), city (1990 pop. 223,019), seat of Summit co., NE Ohio, on the Little Cuyahoga River; inc. 1865. Once the heart of the nation's rubber industry, Akron still contains the headquarters of some rubber corporations and chemical and , Ohio--(BUSINESS WIRE)--April 14, 1998--A. Schulman Schulman is a surname, usually that of a Jewish person. The name is derived from the Yiddish word shul ("synagogue"). Some well-known people with this name are:
in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :SHLM) today announced that net income for the second quarter ended February February: see month. 28, 1998 was $10,986,000 or $.31 per common share compared with $9,747,000 or $.26 for the same quarter last year. Earnings for last year included a charge of $900,000 or $.02 per share for foreign withholding taxes The amount legally deducted from an employee's wages or salary by the employer, who uses it to prepay the charges imposed by the government on the employee's yearly earnings. on dividends from foreign affiliates. Basic and diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. per share earnings are the same. Sales totaled $239.8 million, down slightly from $241.1 million in the second quarter last year. For the six months ended February 28, 1998, income before the cumulative effect of an accounting change was $23,519,000 or $.66 per common share compared with $21,729,000 or $.58 per share for the comparable 1997 period. In November November: see month. 1997, the FASB FASB See: Financial Accounting Standards Board FASB See Financial Accounting Standards Board (FASB). issued a new ruling requiring the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of business process re-engineering See reengineering. (business) Business Process Re-engineering - (BPR) Any radical change in the way in which an organisation performs its business activities. BPR involves a fundamental re-think of the business processes followed by a redesign of business activities to costs. Accordingly, in the first quarter the company wrote off $3,237,000 of such costs that were capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. as of August 31, 1997. The write-off, net of income taxes, amounted to $2,007,000 or $.06 per common share and was accounted for as a cumulative effect of an accounting change. After deducting the charge, net income for the first six months was $21,512,000 or $.60 per common share on both the basic and diluted method. Sales for the six months were $504.0 million compared with $498.9 million for the same period last year. The translation effect from the strength of the U.S. dollar reduced net income by $788,000 or $.02 per share for the quarter and $1,842,000 or $.05 per share for the six months. The translation effect also reduced sales by $14.7 million for the quarter and $34 million for the six month period. Business process re-engineering costs were $633,000 for the quarter and $1,425,000 for the six month period. These costs, which were expensed, relate to the BETT BETT British Education and Training Technology (UK exhibition) BETT Best Estimate Trajectory Tape Program (Business Enhancement Today & Tomorrow), a total redesign re·de·sign tr.v. re·de·signed, re·de·sign·ing, re·de·signs To make a revision in the appearance or function of. re of the company's business processes in North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. . Although parts of this program are now being utilized, current plans provide for implementation in phases through 1999. The benefits from this program will enhance future profitability and enable the company to better serve its customers. The effective tax rate for the quarter was 41% compared with 44% in 1997 which included a $900,000 provision for foreign withholding taxes on dividends. The current quarter and six month period include a new 15% surtax An additional charge on an item that is already taxed. A surtax is a tax on a tax. For example, if a person pays one hundred dollars of tax on one thousand dollars of income, a 5 percent surtax would amount to an additional five dollars. in France. "We have a good level of orders in our European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. operations," said Terry L. Haines Haines refers to: Persons named Haines
softening a change of consistency, with loss of firmness or hardness. of orders in the United Kingdom. Margins in manufacturing were up for the first half, but it appears that competitive price pressures will make it difficult to generate additional margin improvement." In addition, the translation effect of the U.S. dollar will continue to have an adverse effect on earnings. North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. margins in the second half should show year over year gains, but higher costs, such as the company's business re-engineering program and the start-up Start-up The earliest stage of a new business venture. of the new Mexican New Mexico Abbr. NM or N.M. or N.Mex. A state of the southwest United States on the Mexican border. It was admitted as the 47th state in 1912. line, will reduce the improvement. "As we enter the second half of our fiscal year, we have noted some softening in our automotive business. This, combined with higher costs, will make it difficult to achieve our profit objectives," Haines commented. "Accordingly, it appears that per share gains for fiscal 1998 may be less than our estimate of 13%, nevertheless, we continue to believe that 1998 will be a record year," said Haines. Business in A. Schulman's European operations was strong. Total tonnage TONNAGE, mar. law. The capacity of a ship or vessel. 2. The act of congress of March 2, 1799, s. 64, 1 Story's L. U. S. 630, directs that to ascertain the tonnage of any ship or vessel, the surveyor, &c. was up 11% for the quarter on solid gains in merchant activities. Quarterly profit margins were 18.1% compared with 18.4% last year due to lower margins in merchant and distribution activities. Overall earnings for the quarter and six month period were approximately the same as last year due to the adverse effects of currency translation. In North America, profits before withholding taxes and the cumulative effect of accounting changes improved by 13% for the quarter and 33% for the six month period. Tonnage in manufacturing was up 11% for the quarter, but declines in merchant and distribution reduced the gains. Profit margins for the quarter were 15.6% compared with 11.6% last year, with gains in each of the company's activities. Total gross profit was up $3.3 million or 26% for the quarter, but higher operating costs operating costs npl → gastos mpl operacionales offset a large portion of the improvement, the company said. Capacity utilization Capacity Utilization measures the rate at which a firm makes use of their capital productive capacities, such as factories and machinery. Capacity Utilization generally rises when the economy is healthy and falls when demand softens. in Europe was 90% for the current and 1997 quarter. In North America, capacity utilization for the quarter improved to 83% from 70% last year. Worldwide, utilization was 86% in the quarter compared with 78% last year. "Two important capital projects are now substantially completed," Haines noted. In the United Kingdom, a replacement line costing $4 million has started production. The line, which provides 20 million pounds of capacity, will enable A. Schulman to meet the future demand for its products in the United Kingdom. The Company is also in the final stages of completion for a new $5.8 million line in its Mexican Mexican named after or originating in Mexico. Mexican axolotl see ambystomamexicanum. Mexican beaded lizard (Heloderma horridum operation. The line, the second in the facility, will provide A. Schulman with new growth opportunities in Mexico and Latin America Latin America, the Spanish-speaking, Portuguese-speaking, and French-speaking countries (except Canada) of North America, South America, Central America, and the West Indies. . For the six month period, the company repurchased 513,000 common shares for $11.8 million. Through the second quarter, A. Schulman has now repurchased 2,123,000 shares for $44 million under the existing 3 million share repurchase Share Repurchase A program by which a company buys back its own shares from the marketplace, reducing the number of outstanding shares. This is usually an indication that the company's management thinks the shares are undervalued. program. Headquartered in Akron, Ohio Akron is a city in the U.S. state of Ohio and the county seat of Summit County.GR6 The municipality is located in northeastern Ohio on the Cuyahoga River between Cleveland to the north and Canton to the south, approximately 60 miles (96 km) west of , A. Schulman is a leading international supplier of high-performance plastic compounds and resins resins, n.pl complex, insoluble, sticky substances secreted by plants. Used as astringents, antimicrobials, and antiinflammatories, and are burned as incense. Can cause oral ulcers and epidermal irritations. . These materials are used in a variety of consumer, industrial, automotive and packaging applications. The Company employs 2,200 people and has 13 manufacturing facilities in North America, Europe, Mexico and the Asia-Pacific region. Revenues in fiscal 1997 were $996 million. -0-
A. Schulman, Inc. and its Consolidated Subsidiaries
Financial Highlights
Three Months Ended
Feb. 28, 1998 Feb. 28, 1997
Net Sales $239,840,000 $241,125,000
Interest and Other Income 672,000 1,371,000
240,512,000 242,496,000
Cost of Sales 198,962,000 204,227,000
Other Costs and Expenses 22,941,000 20,842,000
221,903,000 225,069,000
Income before Taxes and Cumulative Effect of
Accounting Change 18,609,000 17,427,000
Provision for U.S. and Foreign
Income Taxes 7,623,000 7,680,000
Income before Cumulative Effect
of Accounting Change 10,986,000 9,747,000
Cumulative Effect of
Accounting Change(b) - -
Net Income $ 10,986,000 $ 9,747,000(a)
Weighted Average Number of Shares Outstanding:
Basic 35,764,943 37,654,464
Diluted 35,834,581 37,664,125
Basic Earnings per Share:
Income Before Cumulative
Effect of Accounting Change $0.31 $0.26
Cumulative Effect of
Accounting Change - -
Net Income $0.31 $0.26(a)
Diluted Earnings per Share:
Income Before Cumulative Effect
of Accounting Change $0.31 $0.26
Cumulative Effect of
Accounting Change - -
Net Income $0.31 $0.26(a)
Six Months Ended
Feb. 28, 1998 Feb. 28, 1997
Net Sales $504,048,000 $498,932,000
Interest and Other Income 1,603,000 2,905,000
505,651,000 501,837,000
Cost of Sales 419,351,000 419,791,000
Other Costs and Expenses 46,577,000 44,670,000
465,928,000 464,461,000
Income before Taxes and Cumulative
Effect of Accounting Change 39,723,000 37,376,000
Provision for U.S. and
Foreign Income Taxes 16,204,000 15,647,000
Income before Cumulative Effect of
Accounting Change 23,519,000 21,729,000
Cumulative Effect of
Accounting Change(b) (2,007,000)
-
Net Income $ 21,512,000 $ 21,729,000(a)
Weighted Average Number of
Shares Outstanding:
Basic 35,897,235 37,723,214
Diluted 35,948,676 37,729,559
Basic Earnings per Share:
Income Before Cumulative
Effect of Accounting Change $0.66 $0.58
Cumulative Effect of
Accounting Change -0.06 -
Net Income $0.60 $0.58(a)
Diluted Earnings per Share:
Income Before Cumulative
Effect of Accounting Change $0.66 $0.58
Cumulative Effect of
Accounting Change -0.06 -
Net Income $0.60 $0.58(a)
(a) After deducting foreign withholding taxes of $900,000 or
$.02 per share for dividends from foreign affiliates paid in
March, 1997.
(b) On November 20, 1997, The FASB Emerging Issues Task Force
issued a new ruling which requires the write-off of business
process re-engineering costs. Accordingly, $3,237,000 of
such costs capitalized as of August 31, 1997 were written
off in the quarter ending November 30, 1997. This write-off,
net of income taxes, amounted to $2,007,000 or $.06 per common
share and was accounted for as a change in accounting.
Condensed Balance Sheet
Feb. 28, 1998 August 31, 1997
Assets
Current Assets $429,117,000 $403,714,000
Other Assets 17,397,000 19,836,000
Net Property, Plant and
Equipment 139,193,000 139,395,000
$585,707,000 $562,945,000
Liabilities and Stockholders' Equity
Current Liabilities $118,084,000 $111,741,000
Long-Term Debt 30,000,000 12,009,000
Deferred Credits and Other
Long-Term Liabilities, etc. 45,886,000 45,794,000
Stockholders' Equity 391,737,000 393,401,000
$585,707,000 $562,945,000
Supplemental Information (in thousands of dollars)
Three Months Ended
Feb. 28, 1998 Feb. 28, 1997
Net Sales
Manufacturing $158,513 $158,425
Merchant 43,353 43,385
Distribution 37,974 39,315
$239,840 $241,125
Gross Profit
Manufacturing $30,968 $26,398
Merchant 5,265 5,476
Distribution 4,645 5,024
$ 40,878 $ 36,898
Six Months Ended
Feb. 28, 1998 Feb. 28, 1997
Net Sales
Manufacturing $331,359 $329,130
Merchant 92,745 87,929
Distribution 79,944 81,873
$504,048 $498,932
Gross Profit
Manufacturing $63,431 $57,472
Merchant 11,450 11,095
Distribution 9,816 10,574
$84,697 $79,141
Certain items previously reported have been reclassified to
conform with the 1998 presentation.
CONTACT: A. Schulman Inc. Robert A. Stefanko, 330/666-3751 |
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