Crompton's Fourth Quarter Earnings Significantly Exceed Prior Year.Business Editors MIDDLEBURY Middlebury College is a liberal-arts college in Middlebury, Vermont, founded in 1800. Middlebury is the name of some places in the United States of America:
Crompton Corporation Crompton Corporation, formerly Crompton and Knowles, is a chemical research, production, sales and distribution company headquartered in Middlebury, Connecticut. The company produces specialty chemicals used for polymers, fire suppressants and retardants, pool and spa water (NYSE NYSE See: New York Stock Exchange : CK) reported today fourth quarter earnings of $2.4 million, or two 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. , compared to a loss of $85.4 million, or 76 cents per share, in the fourth quarter of 2001. Earnings for the fourth quarter of 2002 included after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. special charges for previously announced facility closures, severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when and related costs ($4 million) and antitrust Antitrust The antitrust laws apply to virtually all industries and to every level of business, including manufacturing, transportation, distribution, and marketing. They prohibit a variety of practices that restrain trade. investigation costs ($3.9 million). The net loss for the fourth quarter of 2001 included after-tax special charges for facility closures, severance and related costs ($6.7 million), impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. of long-lived long-lived adj. 1. Having a long life: a long-lived aunt. 2. Lasting a long time; persistent: a long-lived rumor. 3. assets ($50.8 million), and a loss on the sale of the industrial colors and nitrile rubber Nitrile rubber, or Buna-N,is a synthetic rubber copolymer of acrylonitrile (ACN) and butadiene. Some trade names are: Nipol, Krynac and Europrene. businesses ($14.1 million). Net earnings before such special items were $10.4 million, or nine cents per share, compared to a net loss of $13.8 million, or 12 cents per share, for the fourth quarter of 2001. Fourth quarter sales of $587.6 million were three percent below the prior year. Adjusting for divested operations, sales increased four percent, with improved unit volume of five percent and favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. foreign currency translation of two percent more than offsetting lower selling prices of three percent. "Despite a sluggish economic environment, we are pleased that earnings before special items for the quarter and year showed significant improvement over 2001, reflecting our successful restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). and cost reduction programs as well as our improved market positions," said Vincent A. Calarco, chairman, president and chief executive officer. "Additionally, we were pleased to complete in 2002 the divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of the industrial specialties business and to use those proceeds, as well as other funds, to reduce debt by $155 million. Debt reduction will continue to be a primary goal in 2003. "There are many economic and geopolitical ge·o·pol·i·tics n. (used with a sing. verb) 1. The study of the relationship among politics and geography, demography, and economics, especially with respect to the foreign policy of a nation. 2. a. uncertainties impacting the global economy making definitive earnings guidance difficult at this time. Nonetheless, we estimate that 2003 earnings before special items will be in the range of 45 to 55 cents per share." For the year, the Company reported a net loss of $283.5 million, or $2.45 per 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. share, compared to a net loss of $123.9 million, or $1.10 per share, for the comparable period of 2001. The net loss for 2002 included a cumulative effect of accounting change for goodwill impairment ($299 million), and after-tax special charges for facility closures, severance and related costs ($14.6 million), antitrust investigation costs ($3.9 million), and a loss on the sale of the industrial specialties business ($21.1 million). The net loss for 2001 included after-tax special charges for facility closures, severance and related costs ($75 million), impairment of long-lived assets ($50.8 million), and a loss on the sale of the industrial colors and nitrile rubber businesses ($14.1 million). Net earnings before such special items were $55.1 million, or 48 cents per share, compared to $15.9 million, or 14 cents per share, for 2001. Sales in 2002 of $2.55 billion were six percent below 2001. Adjusting for divested operations, sales were three percent below 2001 due primarily to lower selling prices. At December December: see month. 31, 2002, as a result of the reduction in the market value of the Company's pension plan assets and the lower discount rate used to measure the Company's pension liability, the Company recorded a pension adjustment of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $126 million as an increase to its pension liability (included in other liabilities other liabilities Small and relatively insignificant liabilities. For financial reporting purposes, firms often combine small liabilities into this single category rather than listing each liability separately. on the balance sheet), with a charge of approximately $78 million (net of tax) recorded as a component of accumulated ac·cu·mu·late v. ac·cu·mu·lat·ed, ac·cu·mu·lat·ing, ac·cu·mu·lates v.tr. To gather or pile up; amass. See Synonyms at gather. v.intr. To mount up; increase. other comprehensive loss. Fourth quarter operating results for the Company's reporting segments are summarized as follows: Polymer polymer (pŏl`əmər), chemical compound with high molecular weight consisting of a number of structural units linked together by covalent bonds (see chemical bond). Products Polymer additives sales of $270.9 million were up five percent from the prior year as an increase in unit volume of seven percent and favorable foreign currency translation of two percent were partially offset by a decline in selling prices of four percent. Plastic additives sales rose four percent due primarily to increased U.S. and Asian demand. Urethane urethane (yoor´ithān´), n ethyl carbamate used as an anesthetic agent for laboratory animals, formerly used as a hypnotic in humans. additives sales rose six percent mainly as a result of favorable foreign currency translation. Rubber additives sales increased 13 percent as unit volume was up in all regions, albeit at substantially lower prices. Petroleum additives sales were down two percent due mainly to lower selling prices. Operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of $17.4 million was up 153 percent from the prior year due primarily to higher unit volume and reduced product In model theory, a branch of mathematical logic, the reduced product is a construction that generalizes both direct product and ultraproduct. costs, partially offset by lower selling prices. Lower product costs were mainly the result of increased plant throughput The speed with which a computer processes data. It is a combination of internal processing speed, peripheral speeds (I/O) and the efficiency of the operating system and other system software all working together. 1. , reduced raw material/energy costs and cost saving initiatives. Polymers sales of $63.8 million were up two percent from the fourth quarter of 2001 due to an increase in unit volume of six percent and favorable foreign currency translation of one percent, partially offset by lower selling prices of five percent. EPDM EPDM Ethylene-Propylene-Diene-Monomer EPDM Enterprise Product Data Management EPDM Ethylene Propylene Dimonomer (industrial/commercial piping/plumbing components) EPDM Engineering Product Data Management sales were down four percent as the impact of lower selling prices was partially offset by higher unit volume. Urethane polymers sales were up eight percent due mainly to increased domestic and Asian demand. Operating profit of $9.4 million was up 56 percent from the prior year. However, after adjusting prior year results to exclude the loss attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the divested nitrile rubber business, operating profit was up 26 percent due primarily to higher unit volume, lower raw material/energy costs and increased plant throughput, partially offset by reduced EPDM selling prices. Polymer processing equipment sales of $42.0 million were down six percent from the prior year as spending for capital equipment remained at depressed Depressed A description of a market, security, or product that is experiencing weak demand and lowering prices. Notes: A depressed market, security, or product implies that prices and volume are low. There are many reasons for a depressed market, security, or product. levels. A decline in unit volume of 10 percent was offset in part by favorable foreign currency translation of approximately four percent. Despite lower sales, the operating loss 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. of $4.8 million was favorable versus the fourth quarter of 2001 by 17 percent due to substantial cost reduction initiatives. The backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. at the end of 2002 of $76 million was down $7 million from the end of 2001. Specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. Products OrganoSilicones sales of $107.8 million were up four percent from the fourth quarter of 2001 as a seven percent increase in unit volume, resulting from greater international demand, and favorable foreign currency translation of three percent, more than offset a decline in selling prices of six percent. Operating profit of $18.2 million was up 151 percent from the prior year due mainly to higher unit volume, savings attributable to plant expansions in Italy Italy (ĭt`əlē), Ital. Italia, officially Italian Republic, republic (2005 est. pop. 58,103,000), 116,303 sq mi (301,225 sq km), S Europe. and the U.S., and reduced raw material costs, offset in part by lower selling prices. Crop protection sales of $50.5 million were up 12 percent from the prior year due to higher unit volume of 11 percent resulting from increased demand in the U.S. 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. , and favorable foreign currency translation of one percent. Operating profit of $10.0 million was up nine percent from the prior year due primarily to higher unit volume, partially offset by certain non-recurring costs. Other sales of $56.5 million were down 39 percent from the prior year due primarily to the divestiture of the industrial colors and industrial specialties businesses. Excluding divested businesses, sales were up seven percent as a result of higher unit volume of five percent and favorable foreign currency translation of two percent. Operating profit of $0.6 million was down 69 percent from the fourth quarter of 2001. Crompton Corporation is a $2.5 billion global producer and marketer of 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. and polymer products and equipment. The attached supplementary schedules contain adjusted financial measures intended to more fully explain the underlying operational performance of the Company by eliminating the effect of special items which can obscure OBSCURE - "A Formal Description of the Specification Language OBSCURE", J. Loeckx, TR A85/15, U Saarlandes, Saarbrucken, 1985. trends that are necessary for a balanced appraisal of the Company's activities that occur in the normal course of operations. The adjustments include facility closure, severance and related costs, antitrust investigation costs, impairment of long-lived assets and losses on the sale of business units. In addition, operating results have been adjusted to exclude the impact of such divestments. Readers should not consider these adjusted financial measures as a substitute for the Company's reported financial results under generally accepted accounting principles The standard accounting rules, regulations, and procedures used by companies in maintaining their financial records. Generally accepted accounting principles (GAAP) provide companies and accountants with a consistent set of guidelines that cover both broad accounting (GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). ). The supplementary schedules should be used as a supplement to GAAP results to assist the reader in better understanding the operational performance of the Company. Supplementary schedules include the "Consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: Statement of Operations See Income statement. Adjusted for Special Items and Divested Operations," "Segment Sales and Operating Profit (Loss)," and "Major Factors Affecting Results." The Company will conduct its fourth quarter conference call at 9:00 a.m. Eastern Standard Time (EST EST electroshock therapy. EST abbr. electroshock therapy ) on February February: see month. 5, 2003. The telephone number is 913-981-5591. Live audio is available on the Company's investor relations Investor relations The process by which the corporation communicates with its investors. page at www.cromptoncorp.com. Replay of the conference call will be available for two weeks beginning at 2:00 p.m. EST P.M. also p.m. or p.m. abbr. post meridiem Usage Note: By definition, 12 a.m. on February 5, 2003, by calling 719-457-0820, access code 482108. Certain statements made in this release are 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. that involve risks and uncertainties, including, but not limited to, general economic conditions, antitrust investigations, energy and raw material prices and availability, production capacity, changes in interest rates and foreign currency exchange rates, changes in technology, market demand and customer requirements, the enactment of more stringent environmental laws and regulations, and other risks and uncertainties detailed in the Company's filings with the Securities and Exchange Commission. These statements are based on currently available information and the Company's actual results may differ significantly from the results discussed. Forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. information is intended to reflect opinions as of the date this release was issued and such information will not necessarily be updated by the Company.
CROMPTON CORPORATION
Consolidated Statements of Operations
Fourth quarter and year ended 2002 and 2001
(In thousands, except per share data)
Fourth Quarter Year Ended
------------------ ---------------------
2002 2001 2002 2001
-------- --------- ---------- ----------
Net sales $587,579 $ 604,909 $2,546,872 $2,718,798
Cost of products sold 402,109 433,139 1,754,123 1,905,336
Selling, general and admin. 99,606 104,744 396,266 421,554
Depreciation and
amortization 34,328 44,966 146,550 185,570
Research and development 20,215 20,128 81,872 82,334
Equity income (4,449) (3,812) (7,917) (9,278)
Facility closures, severance
and related costs 6,584 10,580 23,317 106,516
Antitrust investigation
costs 6,306 - 6,306 -
Impairment of long-lived
assets - 80,366 - 80,366
-------- --------- ---------------------
Operating profit (loss) 22,880 (85,202) 146,355 (53,600)
Interest expense 24,273 26,115 101,704 109,877
Other (income) expense (3,291) 20,740 35,366 25,129
-------- --------- ---------- ----------
Earnings (loss) before
income taxes and cumulative
effect of accounting change 1,898 (132,057) 9,285 (188,606)
Income tax benefit (527) (46,657) (6,189) (64,662)
-------- --------- ---------- ----------
Earnings (loss) before
cumulative effect of
accounting change 2,425 (85,400) 15,474 (123,944)
Cumulative effect of
accounting change - - (298,981) -
-------- --------- ---------- ----------
Net earnings (loss) $ 2,425 $ (85,400)$ (283,507)$ (123,944)
======== ========= ========== ==========
Basic earnings (loss) per
common share:
Earnings (loss)
before cumulative
effect of accounting
change $ 0.02 $ (0.76) $ 0.13 $ (1.10)
Cumulative effect
of accounting change - - (2.63) -
-------- --------- ---------- ----------
Net earnings (loss) $ 0.02 $ (0.76) $ (2.50)$ (1.10)
========= ========= ========== ==========
Weighted average
shares outstanding 113,788 113,020 113,568 113,061
======== ======== ========== ==========
Diluted earnings (loss) per
common share:
Earnings (loss)
before cumulative
effect of accounting
change $ 0.02 $ (0.76) $ 0.13 $ (1.10)
Cumulative effect
of accounting change - - (2.58) -
-------- --------- ---------- ----------
Net earnings (loss) $ 0.02 $ (0.76) $ (2.45) $ (1.10)
======== ========= ========== ==========
Weighted average
shares outstanding 114,756 113,020 115,656 113,061
======== ========= ========== ==========
CROMPTON CORPORATION
Consolidated Balance Sheets
December 31, 2002 and 2001
(In thousands of dollars)
December December
31, 2002 31, 2001
----------- ----------
ASSETS
CURRENT ASSETS
Cash $ 16,941 $ 21,506
Accounts receivable 185,983 188,133
Inventories 460,116 491,693
Other current assets 114,094 113,742
---------- ----------
Total current assets 777,134 815,074
---------- ----------
NON-CURRENT ASSETS
Property, plant and equipment 942,516 1,021,983
Cost in excess of acquired net assets 584,633 897,404
Other assets 536,532 497,727
---------- ----------
$2,840,815 $3,232,188
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Notes payable $ 5,727 $ 29,791
Accounts payable 276,133 234,985
Accrued expenses 267,849 285,329
Income taxes payable 116,111 111,905
Other current liabilities 15,670 20,608
---------- ----------
Total current liabilities 681,490 682,618
---------- ----------
NON-CURRENT LIABILITIES
Long-term debt 1,261,847 1,392,833
Postretirement health care liability 193,996 199,583
Other liabilities 503,599 409,613
STOCKHOLDERS' EQUITY
Common stock 1,192 1,192
Additional paid-in capital 1,048,304 1,051,257
Accumulated deficit (586,555) (280,350)
Accumulated other comprehensive loss (200,426) (151,839)
Treasury stock at cost (62,632) (72,719)
---------- ----------
Total stockholders' equity 199,883 547,541
---------- ----------
$2,840,815 $3,232,188
========== ==========
CROMPTON CORPORATION
Consolidated Statements of Cash Flows
Year ended 2002 and 2001
(In thousands of dollars)
Year Ended
--------------------
Increase (decrease) to cash 2002 2001
-------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $(283,507) $(123,944)
Adjustments to reconcile net loss to net
cash provided by operations:
Cumulative effect of accounting change 298,981 -
Facility closures, severance and related
costs 23,317 114,033
Antitrust investigation costs 6,306 -
Impairment of long-lived assets - 80,366
Losses on sale of business units 34,705 19,121
Depreciation and amortization 146,550 185,570
Equity income (7,917) (9,278)
Changes in assets and liabilities, net:
Accounts receivable 7,858 93,053
Inventories 22,683 22,771
Accounts payable 28,945 12,594
Other (76,010) (208,637)
--------- ---------
Net cash provided by operations 201,911 185,649
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of business units 80,000 35,061
Capital expenditures (100,309) (136,642)
Other investing activities (1,526) 933
--------- ---------
Net cash used in investing activities (21,835) (100,648)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Payments on debt (168,928) (103,838)
(Repurchases) proceeds from sale of
accounts receivable (157) 19,358
Dividends paid (22,698) (22,542)
Proceeds from interest rate swap contract - 21,870
Other financing activities 6,415 1,555
--------- ---------
Net cash used in financing activities (185,368) (83,597)
--------- ---------
CASH
Effect of exchange rates on cash 727 (675)
--------- ---------
Change in cash (4,565) 729
Cash at beginning of period 21,506 20,777
--------- ---------
Cash at end of period $ 16,941 $ 21,506
========= =========
SUPPLEMENTARY SCHEDULE
----------------------
CROMPTON CORPORATION
Consolidated Statement of Operations Adjusted for Special Items and
Divested Operations
Fourth quarter and year ended 2002 and 2001
(In thousands, except per share data)
Fourth Quarter
-------------------------------------------
Adjusted
2002 (a) 2001 (a) 2001 (b)
-------- -------- -----------
Net sales $587,579 $604,909 $564,658
Cost of products
sold 402,109 432,757 402,413
Selling, general
and admin. 99,606 104,744 97,991
Depreciation and
amortization 34,328 44,966 42,080
Research and
development 20,215 20,128 18,699
Equity income (4,449) (3,812) (5,128)
-------- -------- --------
Operating profit
before special
items 35,770 6,126 $ 8,603
=========
Interest expense 24,273 26,115
Other (income)
expense (3,291) 1,619
-------- --------
Earnings (loss) before
income taxes and
special items 14,788 (21,608)
Income taxes (benefit) 4,417 (7,780)
-------- --------
Earnings (loss)
before after-tax
special items 10,371 (13,828)
Facility closures,
severance and
related costs (4,021) (6,693)
Antitrust investigation
costs (3,925) -
Impairment of
long-lived assets - (50,788)
Losses on sale of
business units - (14,091)
Cumulative effect of
accounting change - -
-------- --------
Net earnings (loss) $ 2,425 $(85,400)
========= =========
Diluted earnings (loss) per
common share:
Earnings (loss) before
after-tax special
items $ 0.09 $ (0.12)
========= =========
Net earnings (loss) $ 0.02 $ (0.76)
========= =========
Year Ended
---------------------------------------------
Adjusted
2002 (a) 2001 (a) 2001(b)
---------------------------------------------
Net sales $2,546,872 $2,718,798 $ 2,612,842
Cost of products
sold 1,754,123 1,897,819 1,819,632
Selling, general
and admin. 396,266 421,554 403,573
Depreciation and
amortization 146,550 185,570 178,360
Research and
development 81,872 82,334 79,131
Equity income (7,917) (9,278) (13,565)
---------- ---------- -----------
Operating profit
before special
items 175,978 140,799 $ 145,711
===========
Interest expense 101,704 109,877
Other (income)
expense 661 6,008
---------- ----------
Earnings (loss) before
income taxes and
special items 73,613 24,914
Income taxes (benefit) 18,535 8,968
------- -----------
Earnings (loss)
before after-tax
special items 55,078 15,946
Facility closures,
severance and
related costs (14,562) (75,011)
Antitrust investigation
costs (3,925) -
Impairment of
long-lived assets - (50,788)
Losses on sale of
business units (21,117) (14,091)
Cumulative effect of
accounting change (298,981) -
---------- ----------
Net earnings (loss) $ (283,507) $ (123,944)
========== ==========
Diluted earnings (loss) per
common share:
Earnings (loss) before
after-tax special
items $ 0.48 $ 0.14
======== ==========
Net earnings (loss) $ (2.45) $ (1.10)
======== ==========
(a) The following pre-tax amounts of special items represent separate
line items in the "Consolidated Statement of Operations" unless
otherwise indicated below:
Fourth Quarter Year Ended
----------------- ---------------------
2002 2001 2002 2001
-------- -------- ---------- ----------
Facility
closures,
severance and
related costs(i) (6,584) (10,962) (23,317) (114,033)
Antitrust
investigation
costs (6,306) - (6,306) -
Impairment of
long-lived assets - (80,366) - (80,366)
Losses on sale of
business units
(included in
other (income)
expense) - (19,121) (34,705) (19,121)
Cumulative effect
of accounting
change - - (298,981) -
(i) - Includes $382 and $7,517 in cost of goods sold in the fourth
quarter and year ended 2001, respectively.
(b) Adjusted 2001 excludes the third and fourth quarter operating
results of the industrial specialties business (sold June 28, 2002)
and the twelve months of operating results of the industrial colors
and nitrile rubber businesses (sold in December 2001).
SUPPLEMENTARY SCHEDULE
-----------------------
CROMPTON CORPORATION
Segment Sales and Operating Profit (Loss)
Fourth quarter and year ended 2002 and 2001
(In thousands of dollars)
Fourth Quarter
----------------------------------------
Adjusted
2002 2001 2001 (a)
-------- -------- ------------
NET SALES
Polymer Products
Polymer Additives $270,863 $258,522 $258,522
Polymers 63,802 62,471 62,471
Polymer Processing
Equipment 41,970 44,825 44,825
Eliminations (3,856) (3,018) (3,018)
--------- --------- ---------
372,779 362,800 362,800
--------- --------- ---------
Specialty Products
OrganoSilicones 107,815 103,978 103,978
Crop Protection 50,476 45,004 45,004
Other 56,509 93,127 52,876
--------- -------- --------
214,800 242,109 201,858
--------- -------- --------
$587,579 $604,909 $564,658
========= ========= =========
OPERATING PROFIT
(LOSS)
Polymer Products
Polymer Additives $ 17,449 $ 6,905 $ 6,905
Polymers 9,405 6,034 7,454
Polymer Processing
Equipment (4,762) (5,703) (5,703)
-------- -------- --------
22,092 7,236 8,656
-------- -------- --------
Specialty Products
OrganoSilicones 18,210 7,269 7,269
Crop Protection 10,002 9,154 9,154
Other 551 1,785 2,842
-------- -------- --------
28,763 18,208 19,265
-------- -------- --------
General corporate
expense (15,085) (19,318) (19,318)
-------- -------- --------
35,770 6,126 $ 8,603
========
Facility closures,
severance and
related costs (b) (6,584) (10,962)
Antitrust
investigation costs (6,306) -
Impairment of long-
lived assets - (80,366)
-------- --------
$ 22,880 $(85,202)
========= =========
Year Ended
--------------------
Adjusted
2002 2001 2001 (a)
--------- ---------- -----------
NET SALES
Polymer Products
Polymer Additives $1,110,804 $1,125,910 $ 1,125,910
Polymers 270,954 292,092 292,092
Polymer Processing
Equipment 172,702 202,653 202,653
Eliminations (15,064) (13,805) (13,805)
-------- --------- -----------
1,539,396 1,606,850 1,606,850
---------- ---------- -----------
Specialty Products
OrganoSilicones 456,601 432,255 432,255
Crop Protection 240,142 245,562 245,562
Other 310,733 434,131 328,175
--------- --------- ----------
1,007,476 1,111,948 1,005,992
---------- ---------- ----------
$2,546,872 $2,718,798 $ 2,612,842
=========== =========== ============
OPERATING PROFIT
(LOSS)
Polymer Products
Polymer Additives $ 79,403 $ 55,723 $ 55,723
Polymers 41,028 42,243 47,305
Polymer Processing
Equipment (13,766) (15,647) (15,647)
--------- ---------- ------------
106,665 82,319 87,381
--------- ---------- ------------
Specialty Products
OrganoSilicones 56,031 46,135 46,135
Crop Protection 60,241 79,186 79,186
Other 7,960 10,779 10,629
---------- ---------- -----------
124,232 136,100 135,950
---------- ---------- -----------
General corporate
expense (54,919) (77,620) (77,620)
---------- ---------- ------------
175,978 140,799 $ 145,711
============
Facility closures,
severance and
related costs (b) (23,317) (114,033)
Antitrust
investigation costs (6,306) -
Impairment of long-
lived assets - (80,366)
---------- ----------
$ 146,355 $ (53,600)
========== ===========
(a) Adjusted 2001 excludes the third and fourth quarter operating
results of the industrial specialties business (sold June 28, 2002)
and the twelve months of operating results of the industrial colors
and nitrile rubber businesses (sold in December 2001).
(b) Includes $382 and $7,517 in costs of goods sold in the fourth
quarter and year ended 2001, respectively.
SUPPLEMENTARY SCHEDULE
-----------------------
CROMPTON CORPORATION
Major Factors Affecting Results
Fourth Quarter and Year Ended 2002 versus 2001
(In millions, except per share data)
The following table summarizes the major factors contributing to the
fourth quarter and annual change in sales and earnings (loss) before
special items versus the prior year:
Fourth Quarter Year Ended
------------------------- --------------------------
Net Earnings EPS Net Earnings EPS
Sales (Loss) (Diluted) Sales (Loss) (Diluted)
------- ------- --------- ------- -------- ---------
2001 before
special items(a) $604.9 $(13.8) $(0.12) $2,718.8 $15.9 $0.14
Divested
operations (40.3) 1.6 (106.0) 2.5
Unit volume/mix 29.6 7.4 (15.1) (10.8)
Lower selling
prices (19.1) (12.2) (74.2) (50.2)
Foreign currency
translation 12.5 1.7 23.4 4.2
Accounting change -
goodwill
amortization - 6.3 - 26.1
Pension gain -
2001 - - - (3.6)
Costs savings - 11.6 - 38.4
Raw
materials/energy - 6.0 - 50.7
Absorption
variances - 4.3 - (7.0)
Adjustment of
environmental
reserve - 2001 - - - (3.8)
Other - (2.5) - (7.3)
------- ------- ------ -------- ------ --------
2002 before
special items(a) $587.6 $10.4 $0.09 $2,546.9 $55.1 $0.48
======= ======= ======= ========= ====== ========
(a) Refer to "Consolidated Statement of Operations Adjusted for
Special Items and Divested Operations" included as a supplementary
schedule in this release.
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