A. Schulman Reports Second-Quarter 2002 Results.Business Editors 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 11, 2002 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:
-- Worldwide and regional economic, business and political conditions -- Fluctuations in the value of the currencies in major areas where the Company operates, i.e., the U.S. dollar, the Euro, U.K. pound sterling, Canadian dollar, Mexican peso and Indonesian rupiah -- Fluctuations in the prices of plastic resins and other raw materials -- Changes in customer demand and requirements A. Schulman Inc. (Nasdaq:SHLM) announced today net income for the second fiscal quarter ended February February: see month. 28, 2002 was $4,457,000 or $.15 per common share, a significant improvement over earnings of $1,422,000 or $.05 per share for the same quarter last year. The primary reasons for the increase in earnings were higher margins, especially 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. , and lower operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. and interest costs. "We are pleased to report an increase in net income despite a difficult and challenging economic environment," said Terry L. Haines Haines refers to: Persons named Haines
Sales for the second fiscal quarter were $213.6 million, down $25.3 million or 10.6% from last year's sales of $238.9 million for the same period. 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 slightly for the quarter, but sales were reduced by 3.3% due to the translation effect of currencies and 7.4% because of lower prices and changes in product mix. Net income for the six months ended February 28, 2002 was $9,667,000 or $.33 per share compared with earnings of $695,000 or $.02 per share for the same period last year. Last year's earnings included a charge of $4,635,000 or $.16 per share for the costs of closing the Company's 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 manufacturing facility. Sales were $451.7 million for the six months ended February 28, 2002, down 8.8% from sales of $495.5 million for the same period last year. Sales were lower due to a 6.4% decline in price and product mix, a 1.9% decline in tonnage and a 0.5% reduction due to the translation effect of currencies. 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 for all reported periods. The translation effect of foreign currencies, primarily the weaker Euro, reduced sales by $7.9 million for the quarter and $2.6 million for the six-month period. Translation also reduced net income by $453,000 or $.02 per share for the quarter and $217,000 or $.01 per share for the six-month period. Second-Quarter Results in North America and Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000).
Earnings were higher for the quarter primarily due to a $4,856,000 profit improvement in North America. The improvement in North America was due to higher profit margins and a reduction in operating expenses. Quarterly gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. in North America were 12.8% compared with 7.7% in the same quarter last year. Tonnage was down 3.4% for the quarter and utilization utilization, n 1. the extent to which a given group uses a particular service in a specified period. Although usually expressed as the number of services used per year per 100 or per 1000 persons eligible for the service, utilization rates may be was 75%, up slightly from the same quarter last year. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. in Europe, although down 11.7% or $1,214,000 from last year's second quarter, continued to provide a significant portion of A. Schulman's overall earnings. European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. operating income was $9,135,000 for the quarter, a 7.2% operating margin Operating Margin A ratio used to measure a company's pricing strategy and operating efficiency. Calculated by: compared with 6.9% last year. European gross profit margins improved to 16.3% for the quarter compared with 15.2% for last year's second quarter. Tonnage in Europe was 2.1% higher for the quarter and utilization improved to 89% from 86% in the same quarter last year. Profits declined primarily due to a $21.6 million reduction in sales resulting from lower prices, changes in product mix and competitive price pressures. Expansion in Poland Poland, Pol. Polska, officially Republic of Poland, republic (2005 est. pop. 38,635,000), 120,725 sq mi (312,677 sq km), central Europe. It borders on Germany in the west, on the Baltic Sea and the Kaliningrad region of Russia in the north, on Lithuania, and China A. Schulman plans to further expand its presence in both Poland and China. "We already do business in Poland, but we need to establish a manufacturing facility," Haines said. "We have also sold material in China for many years, but we believe that a manufacturing plant is required so we can share in this growing market. Accordingly, we plan on acquiring land in Poland and China in the months ahead." Business Outlook and Earnings Guidance "We have noted an improvement in our recent order levels and inventories of customers are at low levels," Haines said. "However, customers continue to be cautious and are reluctant to rebuild inventories even though resin resin, any of a class of amorphous solids or semisolids. Resins are found in nature and are chiefly of vegetable origin. They are typically light yellow to dark brown in color; tasteless; odorless or faintly aromatic; translucent or transparent; brittle, fracturing prices have increased." Overall, Haines noted, "We anticipate third-quarter earnings to improve over the year-ago period, when net income was $6,486,000 or $.22 per share. Our margins are good even though we are seeing some increases in the cost of our raw materials, primarily plastic 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. . Competitive pressures continue to provide a challenging environment. However, we see better business conditions throughout our operations and there are a number of signs of further improvement in business activity. Accordingly, we are confident that our core strengths and stronger economic conditions will enable us to generate improved results for the balance of our fiscal year." Conference Call on the Web A live Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the broadcast of A. Schulman's conference call regarding fiscal 2002 second-quarter earnings can be accessed at 3:30 p.m. Eastern time on Thursday Thursday: see week. , April 11, 2002 at www.vcall.com, where the webcast replay will be archived. About A. Schulman Inc. Headquartered in Akron, Ohio, A. Schulman is a leading international supplier of high-performance Adj. 1. high-performance - modified to give superior performance; "a high-performance car" superior - of high or superior quality or performance; "superior wisdom derived from experience"; "superior math students" plastic compounds and resins. These materials are used in a variety of consumer, industrial, automotive and packaging applications. The Company employs about 2,300 people and has 13 manufacturing facilities in North America, Europe, Mexico Mexico, city, Mexico Mexico or Mexico City, Span. Ciudad de México (Méjico), city (1990 pop. 8,236,960; 1991 met. area est. 20,899,000), central Mexico, capital and largest city of Mexico. and the Asia-Pacific The term Asia-Pacific generally applies to littoral East Asia, Southeast Asia and Australasia near the Pacific Ocean, plus the states in the ocean itself (Oceania). region. Revenues for the fiscal year ended August 31, 2001 were approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $975 million. Additional information about A. Schulman can be found on the World Wide Web at www.aschulman.com. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. Statements in this release which are not historical facts are forward-looking statements which involve risks and uncertainties and actual events or results could differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. in this release. These "forward-looking statements" are based on currently available information. They are also inherently uncertain, and investors must recognize that events could turn out to be significantly different from what was expected. Examples of such uncertainties include, but are not limited to, the following: -- Worldwide and regional economic, business and political conditions -- Fluctuations in the value of the currencies in major areas where the Company operates, i.e., the U.S. dollar, the Euro, U.K. pound sterling, Canadian dollar, Mexican peso and Indonesian rupiah -- Fluctuations in the prices of plastic resins and other raw materials -- Changes in customer demand and requirements In addition, this release contains time-sensitive information that reflects management's best analysis only as of the date of this release. A. Schulman does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or that arise after the date of this release. Further information concerning issues that could materially affect financial performance related to forward-looking statements can be found in A. Schulman's periodic filings with the Securities and Exchange Commission.
A. Schulman, Inc. and its Consolidated Subsidiaries
Financial Highlights
Three Months Ended Six Months Ended
Feb. 28, 2002 Feb. 28, 2001 Feb. 28, 2002 Feb. 28, 2001
------------- ------------- ------------- -------------
Net Sales $213,554,000 $238,873,000 $451,702,000 $495,489,000
Interest and
Other Income 467,000 434,000 1,015,000 849,000
------------ ------------ ------------ ------------
214,021,000 239,307,000 452,717,000 496,338,000
------------ ------------ ------------ ------------
Cost of Sales 181,795,000 209,248,000 384,254,000 430,322,000
Cost of Plant
Closure -
Akron, Ohio -- -- -- 4,635,000
Other Costs
and Expenses 25,077,000 27,188,000 52,519,000 55,259,000
------------ ------------ ------------ ------------
206,872,000 236,436,000 436,773,000 490,216,000
------------ ------------ ------------ ------------
Income before
Taxes 7,149,000 2,871,000 15,944,000 6,122,000
Provision for
U.S. and
Foreign
Income Taxes 2,692,000 1,449,000 6,277,000 5,427,000
------------ ------------ ------------ ------------
Net Income $ 4,457,000 $ 1,422,000 $ 9,667,000 $ 695,000
============ ============ ============ ============
Weighted Average
Number of Shares
Outstanding:
Basic 29,223,455 29,169,922 29,218,164 29,186,589
Diluted 29,553,289 29,169,922 29,383,081 29,186,589
Basic and Diluted
Earnings per
Share $ 0.15 $ 0.05 $ 0.33 $ 0.02
============ ============ ============ ============
Condensed Balance Sheet
Feb. 28, 2002 Aug. 31, 2001
------------- -------------
Assets
Current Assets $378,739,000 $389,548,000
Other Assets 18,070,000 19,516,000
Net Property, Plant and Equipment 169,854,000 169,607,000
------------ ------------
$566,663,000 $578,671,000
============ ============
Liabilities and Stockholders' Equity
Current Liabilities $100,597,000 $100,260,000
Long-Term Debt 100,057,000 105,415,000
Deferred Credits and Other
Long-Term Liabilities, etc. 51,803,000 50,918,000
Stockholders' Equity 314,206,000 322,078,000
------------ ------------
$566,663,000 $578,671,000
============ ============
Supplemental Segment Information
North
America Europe Other Consolidated
------------ ------------ ------------ ------------
Three months ended February 28, 2002:
Sales to
unaffiliated
customers $ 85,996,000 $127,558,000 $ -- $213,554,000
------------ ------------ ------------ ------------
Gross profit 11,010,000 20,749,000 -- 31,759,000
------------ ------------ ------------ ------------
Operating
income (loss) (1,081,000) 9,135,000 -- 8,054,000
Interest
expense, net -- -- (905,000) (905,000)
------------ ------------ ------------ ------------
Income (loss)
before taxes $ (1,081,000) $ 9,135,000 $ (905,000) $ 7,149,000
============ ============ ============ ============
Three months ended February 28, 2001:
Sales to
unaffiliated
customers $ 89,742,000 $149,131,000 $ -- $238,873,000
------------ ------------ ------------ ------------
Gross profit 6,908,000 22,717,000 -- 29,625,000
------------ ------------ ------------ ------------
Operating
income (loss) (5,937,000) 10,349,000 -- 4,412,000
Interest
expense, net -- -- (1,541,000) (1,541,000)
------------ ------------ ------------ ------------
Income (loss)
before taxes $ (5,937,000) $ 10,349,000 $ (1,541,000) $ 2,871,000
============ ============ ============ ============
Six Months Ended February 28, 2002:
Sales to
unaffiliated
customers $180,120,000 $271,582,000 $ -- $451,702,000
------------ ------------ ------------ ------------
Gross profit 23,862,000 43,586,000 -- 67,448,000
------------ ------------ ------------ ------------
Operating
income (loss) (844,000) 18,651,000 -- 17,807,000
Interest
expense, net -- -- (1,863,000) (1,863,000)
------------ ------------ ------------ ------------
Income (loss)
before taxes $ (844,000) $ 18,651,000 $ (1,863,000) $ 15,944,000
============ ============ ============ ============
Six Months Ended February 28, 2001:
Sales to
unaffiliated
customers $197,373,000 $298,116,000 $ -- $495,489,000
------------ ------------ ------------ ------------
Gross profit 17,785,000 47,382,000 -- 65,167,000
------------ ------------ ------------ ------------
Operating
income (loss) (7,343,000) 20,940,000 -- 13,597,000
Cost of plant
closure -
Akron, Ohio -- -- (4,635,000) (4,635,000)
Interest
expense, net -- -- (2,840,000) (2,840,000)
------------ ------------ ------------ ------------
Income (loss)
before taxes $ (7,343,000) $ 20,940,000 $ (7,475,000) $ 6,122,000
============ ============ ============ ============
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