ChemFirst Inc. Announces Second Quarter Results.Business Editors JACKSON Jackson. 1 City (1990 pop. 37,446), seat of Jackson co., S Mich., on the Grand River; inc. 1857. It is an industrial and commercial center in a farm region. , Miss.--(BUSINESS WIRE)--July 25, 2001 ChemFirst Inc. (NYSE NYSE See: New York Stock Exchange :CEM CEM contagious equine metritis. CEM selective medium chocolate agar made with Eugon agar and 5% horse blood; used to cultivate Taylorella equigenitalis. ) announces second quarter earnings of $2.5 million or 17 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. excluding operating losses operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. and write-offs of $19.4 million or $1.34 per share from the recent sale of the company's custom and fine chemicals business. This is slightly better than the company's pre-emptive pre·emp·tive or pre-emp·tive adj. 1. Of, relating to, or characteristic of preemption. 2. Having or granted by the right of preemption. 3. a. estimate of 12 - 15 cents. Reported results were a loss of $16.9 million or $1.17 per share including a 5 cents per share gain on the sale of the company's interest in a captive insurance Captive insurance companies are limited purpose insurance companies established with the specific objective of financing risks emanating from their parent group or groups, they sometimes also insure risks of the parent company's customers. company. Earnings last year were $6.1 million or 38 cents per share. Sales were $89 million versus $101 million last year. Results for the six months were a loss of $11.1 million, or 77 cents per share, compared to earnings from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the of $11.9 million, or 72 cents per share last year. Sales for the six months were $181 million, compared to $200 million last year. Electronic and Other Specialty Chemicals A Specialty chemical is a chemical produced for a specialized use. They are produced in lower volume than bulk chemicals, of which petrochemicals, made from oil feedstocks, are the most common. However, both are produced in a chemical plant. results for the quarter, excluding the custom and fine chemicals items mentioned above, were a loss of $0.1 million, down from earnings of $5.7 million a year ago. Earnings did not include a business interruption insurance Noun 1. business interruption insurance - insurance that provides protection for the loss of profits and continuing fixed expenses resulting from a break in commercial activities due to the occurrence of a peril payment for the quarter for the first time since the June 2000 explosion at Nissin Chemical which disrupted dis·rupt tr.v. dis·rupt·ed, dis·rupt·ing, dis·rupts 1. To throw into confusion or disorder: Protesters disrupted the candidate's speech. 2. supply of hydroxylamine hy·drox·yl·a·mine n. A colorless crystalline compound, NH2OH, explosive when heated, that is used as a reducing agent and in organic synthesis. raw material for HDA (Head Disk Assembly) The mechanical components of a disk drive (minus the electronics), which include the actuators, access arms, read/write heads and platters. HDA - Head Disk Assembly (R) electronic chemicals. The company and its insurance carrier have not yet reached agreement as to lost profits for the quarter related to the hydroxylamine shortage. Electronic chemicals and materials were also hurt by weak market conditions in semiconductors. Adjusted year to date profits of $6.7 million were 23% below comparable results of $8.7 million last year. Sales excluding custom and fine chemicals were $28 million for the quarter and $63 million year to date, versus $36 million and $68 million last year. Polyurethane polyurethane Any of a class of very versatile polymers that are made into flexible and rigid foams, fibres, elastomers (elastic polymers), surface coatings, and adhesives. Chemicals pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern operating profits Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. for the quarter were $6.9 million, compared to $8.4 million same quarter last year. Sales were $47 million versus $45 million last year. Volumes were up slightly, but unit margins were lower on spot sales and short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. contracts. Profits for the six months were $12 million, down from $17.9 million last year as a result of lower volumes and volatile raw material and energy costs first quarter. Sales for the six months were $86 million, down from $91 million. Dividend -- A quarterly cash dividend of 10 cents per share was declared payable June 22, 2001, to stockholders of record at the close of business June 7, 2001. Stock Repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. -- There were no stock repurchases in the quarter due to negotiations related to the sale of the custom and fine chemicals business. The company has repurchased 7.3 million shares of stock at a cost of $161 million since beginning the repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. program in 1997. There is approximately $69 million remaining under the current repurchase authorization The right or permission to use a system resource; the process of granting access. See access control. . Outlook -- "Earnings were off due to weak semiconductor demand and lack of business interruption insurance payments for HDA(R) remover products pending resolution of second quarter claims," said J. Kelley Williams, ChemFirst chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "We expect improvement in electronic chemicals as the semiconductor industry recovers. Polyurethane results should continue to track general economic conditions." Unaudited condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. financial information is attached. A conference call for the investment community is scheduled for July 26, 2001, at 8:00 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT . J. Kelley Williams will host the call. Participants may access the call by dialing 888/664-9853 (USA/Canada) or 312/470-7270 (International) and giving the pass code "Earnings". A taped replay of the call will be available through July 30 and may be accessed by dialing 800/456-0483 (USA/Canada) or 402/998-0077 (International). The call will also be webcast through the company's website www.chemfirst.com and several popular financial websites. This release includes 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. based on management assumptions and expectations. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. For additional information on risk factors that could affect actual results, please refer to the company's 2000 Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. and most recent 10-Q's. ChemFirst produces chemicals for semiconductors and polyurethanes polyurethanes (pŏl'ēy  r`əthānz), group of plastics that may be either thermosetting or thermoplastic. Polyurethane can be made into both flexible and rigid foams. and intermediate chemicals for a variety of applications. Additional
information about the company is available on the ChemFirst website
located at http://www.chemfirst.com.
ChemFirst Inc. and Subsidiaries
Operating Results
(Unaudited. In Thousands, Except Per Share Amounts)
3 Months ended 6 Months ended
June 30 June 30
2001 2000 2001 2000
--------- --------- --------- ---------
Sales:
Electronic and Other
Specialty Chemicals $42,162 56,681 94,362 108,859
Polyurethane Chemicals 46,847 44,675 86,321 90,866
--------- --------- --------- ---------
$89,009 101,356 180,683 199,725
========= ========= ========= =========
Operating profit (loss):
Electronic and Other
Specialty Chemicals $(31,067) 4,783 (22,735) 7,728
Polyurethane Chemicals 6,909 8,434 12,023 17,898
--------- --------- --------- ---------
(24,158) 13,217 (10,712) 25,626
Unallocated corporate expenses (3,294) (2,774) (6,673) (5,359)
Interest expense, net (725) (675) (1,514) (1,213)
Other income (expense), net 1,106 (75) 1,067 (59)
--------- --------- --------- ---------
(27,071) 9,693 (17,832) 18,995
Income tax expense (benefit) (10,151) 3,634 (6,687) 7,123
--------- --------- --------- ---------
Earnings (loss) from
continuing operations (16,920) 6,059 (11,145) 11,872
Gain on disposal
of businesses,
net of taxes -- -- -- 9,656
--------- --------- --------- ---------
Net earnings (loss) $(16,920) 6,059 (11,145) 21,528
========= ========= ========= =========
Earnings (loss) per common share:
Earnings from continuing
operations $(1.19) 0.38 (0.79) 0.73
Gain on disposal of
businesses, net of taxes -- -- -- 0.59
--------- --------- --------- ---------
Net earnings (loss) $(1.19) 0.38 (0.79) 1.32
========= ========= ========= =========
Average shares outstanding 14,172 15,738 14,164 16,358
Earnings (loss) per common share, assuming dilution:
Earnings from
continuing operations $(1.17) 0.38 (0.77) 0.72
Gain on disposal
of businesses, net of taxes -- -- -- 0.59
--------- --------- --------- ---------
Net earnings (loss) $(1.17) 0.38 (0.77) 1.31
========= ========= ========= =========
Average shares outstanding 14,442 15,839 14,400 16,467
Cash dividend declared per
share $0.10 0.10 0.20 0.20
Condensed Consolidated Balance Sheets
(Unaudited. In Thousands)
June 30 Dec. 31 June 30
2001 2000 2000
-------- -------- --------
Cash and cash equivalents $10,084 5,594 8,162
Other current assets 182,566 143,708 135,414
Other assets 166,223 234,441 238,568
-------- -------- --------
Total assets $358,873 383,743 382,144
======== ======== ========
Current liabilities $43,778 54,520 40,378
Long-term debt 50,622 41,640 41,357
Other liabilities 42,589 52,769 47,654
Stockholders' equity 221,884 234,814 252,755
-------- -------- --------
Total liabilities & stockholders' equity $358,873 383,743 382,144
======== ======== ========
Condensed Consolidated Statements of Cash Flows
(Unaudited. In Thousands)
6 Months ended
June 30
2001 2000
-------- --------
Cash flows from operations:
Net earnings (loss) $(11,145) 21,528
Depreciation and amortization 14,537 14,455
Other 2,609 (7,854)
-------- --------
Net cash provided by operating activities 6,001 28,129
-------- --------
Cash flows from investing activities:
Capital expenditures (9,807) (7,575)
Other investing activities 1,638 12,955
-------- --------
Net cash provided by (used in) investing
activities (8,169) 5,380
-------- --------
Cash flows from financing activities:
Net borrowings of notes payable 9,589 17,900
Purchase of common stock -- (54,623)
Other financing activities (2,444) (3,050)
-------- --------
Net cash provided by (used in) financing
activities 7,145 (39,773)
-------- --------
Effect of exchange rate changes on cash (487) (125)
-------- --------
Net increase (decrease) in cash and cash
equivalents $4,490 (6,389)
-------- --------
Cash and cash equivalents at end of period $10,084 8,162
======== ========
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