Engelhard reports sixth consecutive quarter of record net earnings; Nine-percent growth in second quarter.ISELIN, N.J.--(BUSINESS WIRE)--July 24, 1996--Engelhard Corporation (NYSE NYSE See: New York Stock Exchange :EC) today reported that net earnings for the second quarter ended June June: see month. 30 increased nine percent to $40.1 million from $36.7 million in the second quarter of 1995. Net earnings per share for the quarter also increased nine percent to 28 cents from 26 cents a year ago. These results mark the sixth consecutive quarter in which the company has established year-over-year record net earnings. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight were up nine percent to $783.9 million from $721.1 in 1995. Sales gains were achieved in all three of Engelhard's business segments. Engelhard
Engelhard Corporation is an international Fortune 500 company headquartered in Iselin, New Jersey. It is credited with developing the first production catalytic converter. reported net earnings for the first six months of 1996 of $72.6 million, or 51 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. , up 13 percent from $64.3 million, or 45 cents per share, for the same period of 1995. Net sales for the first half of 1996 were up 10 percent to $1.56 billion from $1.42 billion a year ago. "This was another outstanding quarter for us," said Orin R. Smith Orin R. Smith was Chairman and Chief Executive Officer of the Engelhard Corporation from 1999 to 2001. He joined Engelhard as Vice President in 1977, became President in 1984. Prior to joining Engelhard, Smith served as President of M&T Chemicals. , chairman and chief executive officer. "Our operating segments continue to generate strong results, allowing us to provide a good return on equity today while pursuing opportunities for growth in the future." Operating Segments Drive Growth Total operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before rose nine percent in the second quarter to $70.0 million from $64.4 million a year ago. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Smith, Engelhard's Catalysts and Chemicals segment turned in an especially strong performance, with all three businesses in that segment reporting segment reporting A type of financial reporting in which the firm discloses information by identifiable industry segments. For example, Union Pacific Corporation reports revenues, income, assets, depreciation, and capital expenditures for each of four increased earnings. The Catalysts and Chemicals segment posted a 24 percent increase in operating earnings to $34.1 million, aided by increased raw material yields resulting from operating efficiencies. Sales and profitability for auto emission control The selective and controlled use of electromagnetic, acoustic, or other emitters to optimize command and control capabilities while minimizing, for operations security: a. detection by enemy sensors; b. mutual interference among friendly systems; and/or c. catalysts were up as a result of continuing strong customer demand for newer, advanced technologies. In response to the increased demand, Engelhard is expanding its manufacturing facilities in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and South Africa South Africa, Afrikaans Suid-Afrika, officially Republic of South Africa, republic (2005 est. pop. 44,344,000), 471,442 sq mi (1,221,037 sq km), S Africa. . Solid sales increases of fluid cracking cracking - cracker catalysts in the United States and Asia Pacific combined with lower expenses led to increased earnings from the company's petroleum catalysts business. In the chemical catalysts business, higher volumes in almost all product segments and a favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. product mix contributed to higher profits. Second quarter operating earnings in the Pigments and Additives segment were flat at $22.8 million. Excluding the earnings from the Mearl Corporation, which Engelhard acquired on May 31, segment earnings were down five percent. Increased revenues and profits from 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. mineral products sold to the paint, plastics and inks markets were more than offset by lower earnings from paper pigments. Continued weak economic conditions in the paper industry drove the decline. Recently, Engelhard announced the formation of Dnipro Kaolin kaolin (kā`əlĭn): see china clay. , a 50/50 joint venture in Ukraine Ukraine (y  `krān, ykrān`), Ukr. Ukraina, republic (2005 est. pop. that combines the Company's expertise in
creating pigments from kaolin and in marketing these products with
Ukraine's high-quality kaolin deposits and manufacturing
facilities. The joint venture is expected to provide Engelhard with a
more cost-efficient Adj. 1. cost-efficient - productive relative to the costcost-effective efficient - being effective without wasting time or effort or expense; "an efficient production manager"; "efficient engines save gas" platform for serving the European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. market for paper pigment pigment, substance that imparts color to other materials. In paint, the pigment is a powdered substance which, when mixed in the liquid vehicle, imparts color to a painted surface. products. In the Engineered Materials and Industrial Commodities Management segment second quarter operating earnings declined nine percent to $13.0 million primarily because results for the 1996 quarter exclude sales and earnings associated with the businesses placed in a joint venture with CLAL CLAL Center for Learning and Leadership (New York, NY) . Sales and earnings were up for industrial commodities management and for the engineered materials businesses that remain part of Engelhard. Contributing factors to the gains were higher business activity and improved operating efficiencies. Increased financing costs and lower equity earnings in the quarter were offset by favorable corporate expenses. Corporate expenses included an 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. , non-recurring positive net impact of less than half-a-cent per share resulting from an insurance recovery which was largely offset by a provision for legal fees related to certain existing legal proceedings All actions that are authorized or sanctioned by law and instituted in a court or a tribunal for the acquisition of rights or the enforcement of remedies. . Also, Engelhard has been advised that the Securities and Exchange Commission has issued a formal order of investigation in connection with trading in the company's stock during portions of 1995 following certain public announcements by the company, which, as disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). previously, has been the subject of a pending securities class action litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. since late 1995. Engelhard Corporation is a world-leading provider of environmental technologies, specialty chemical 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. products, engineered materials and related services. -0-
ENGELHARD CORPORATION
INDUSTRY SEGMENT INFORMATION
(Thousands except per share data)
(Unaudited)
Three Months Ended
June 30,
------------------------
1996 1995 Change
---- ---- ------
Net Sales
Catalysts and Chemicals $205,808 $183,749 12%
Pigments and Additives 120,374 104,903 15%
Engineered Materials and
Industrial Commodities
Management 457,681 432,492 6%
-------- --------
$783,863 $721,144 9%
======== ========
Operating Earnings
Catalysts and Chemicals $ 34,144 $ 27,521 24%
Pigments and Additives 22,812 22,562 1%
Engineered Materials and
Industrial Commodities
Management 13,043 14,351 -9%
-------- --------
69,999 64,434 9%
Equity earnings (losses) (546) 979
Interest and other
expenses, net (13,434) (15,117) -11%
-------- --------
Earnings before income
taxes 56,019 50,296 11%
Income tax expense 15,966 13,573 18%
-------- ------
Net earnings $ 40,053 $ 36,723 9%
======== ========
Net earnings per share $ 0.28 $ 0.26 9%
======== ========
Cash dividends paid per
share $ 0.09 $ 0.09 0%
======== ========
Average number of shares
outstanding 143,795 143,539 0%
======== ========
Six Months Ended
June 30,
---------------------------
1996 1995 Change
---- ---- ------
Net Sales
Catalysts and Chemicals $ 416,794 $ 359,273 16%
Pigments and Additives 217,618 206,363 5%
Engineered Materials and
Industrial Commodities
Management 924,191 849,963 9%
---------- ----------
$1,558,603 $1,415,599 10%
========== ==========
Operating Earnings
Catalysts and Chemicals $ 66,346 $ 52,010 28%
Pigments and Additives 40,335 41,332 -2%
Engineered Materials and
Industrial Commodities
Management 25,012 25,384 -1%
---------- ----------
131,693 118,726 11%
Equity earnings (losses) (1,473) 340
Interest and other
expenses, net (28,670) (30,940) -7%
---------- ----------
Earnings before income
taxes 101,550 88,126 15%
Income tax expense 28,942 23,794 22%
---------- ----------
Net earnings $ 72,608 $ 64,332 13%
========== ==========
Net earnings per share $ 0.51 $ 0.45 13%
========== ==========
Cash dividends paid per
share
$ 0.18 $ 0.17 6%
========== ==========
Average number of shares
outstanding 143,760 143,227 0%
========== ==========
ENGELHARD CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Thousands except per share data)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
------------------ ----------------------
1996 1995 1996 1995
-------- -------- ---------- ----------
Net sales $783,863 $721,144 $1,558,603 $1,415,599
Cost of sales 655,810 595,309 1,320,705 1,177,814
-------- -------- ---------- ----------
Gross profit 128,053 125,835 237,898 237,785
Selling, administrative
and other expenses 62,292 68,865 116,152 134,274
-------- -------- ---------- ----------
Earnings from
operations 65,761 56,970 121,746 103,511
Equity in earnings
(losses) of affiliates (546) 979 (1,473) 340
Net interest expense 9,196 7,653 18,723 15,725
-------- -------- ---------- ----------
Earnings before
income taxes 56,019 50,296 101,550 88,126
Income tax expense 15,966 13,573 28,942 23,794
-------- -------- ---------- ----------
Net earnings $ 40,053 $ 36,723 $ 72,608 $ 64,332
======== ======== ========== ==========
Net earnings per share $ 0.28 $ 0.26 $ 0.51 $ 0.45
======== ======== ========== ==========
Cash dividends paid
per share $ 0.09 $ 0.09 $ 0.18 $ 0.17
======== ======== ========== ==========
Average number of shares
outstanding 143,795 143,539 143,760 143,227
======== ======== ========== ==========
ENGELHARD CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Thousands)
(Unaudited)
June 30, December 31,
1996 1995
---------- ------------
Cash $ 53,813 $ 40,023
Receivables 337,717 268,578
Inventories 315,225 238,002
Other current assets 56,642 54,440
---------- ------------
Total current assets 763,397 601,043
Investments 229,622 224,721
Property, plant and equipment, net 691,050 609,540
Other noncurrent assets 364,821 210,271
---------- ------------
Total assets $2,048,890 $1,645,575
========== ============
Short-term borrowings $ 491,848 $ 183,570
Accounts payable 129,320 101,064
Other current liabilities 210,394 209,875
---------- ------------
Total current liabilities 831,562 494,509
Long-term debt 225,593 211,533
Other noncurrent liabilities 205,350 201,791
Shareholders' equity 786,385 737,742
---------- ------------
Total liabilities and
shareholders' equity $2,048,890 $1,645,575
========== ============
ENGELHARD CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Thousands)
(Unaudited)
Six Months Ended
June 30,
----------------------
1996 1995
---------- ---------
Cash flows from operating activities
Net earnings $ 72,609 $ 64,332
Adjustments to reconcile net earnings to
net cash provided by operating activities
Depreciation, depletion and amortization 36,296 33,322
Equity earnings, net of dividends 3,987 2,817
Change in assets and liabilities (70,423) 3,436
--------- ---------
Net cash provided by operating activities 42,469 103,907
--------- ---------
Cash flows from investing activities
Capital expenditures, net (58,375) (43,611)
Investments and acquisitions (263,976) (28,270)
Other 8,185 (8,876)
--------- ---------
Net cash used in investing activities (314,166) (80,757)
--------- ---------
Cash flows from financing activities
Net change in short-term borrowings 308,354 1,074
Dividends paid (25,905) (24,394)
Other 3,610 19,592
--------- ---------
Net cash provided by (used in) financing
activities 286,059 (3,728)
Effect of exchange rate changes on cash (572) 2,381
--------- ---------
Net change in cash 13,790 21,803
Cash at beginning of year 40,023 26,404
--------- ---------
Cash at end of period $ 53,813 $ 48,207
========= =========
CONTACT: Engelhard Corp., Iselin Mark Dresner, 908/205-6282 |
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