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WINNING STRATEGY IN PLACE AT UNION CARBIDE, SAYS CHAIRMAN ROBERT D. KENNEDY AT ANNUAL MEETING

 WINNING STRATEGY IN PLACE AT UNION CARBIDE,
 SAYS CHAIRMAN ROBERT D. KENNEDY AT ANNUAL MEETING
 DANBURY, Conn., April 22 /PRNewswire/ -- Winning, not survival, is the issue for Union Carbide Corporation (NYSE: UK), according to Chairman Robert D. Kennedy, who said that all the changes under way now at the company are aimed at getting the corporation to the top spot in its segment of the chemical industry.
 Speaking to shareholders at the corporation's annual meeting here today, Kennedy said that Union Carbide's strategy could not be clearer now or more direct. "Unlike some other chemical companies moving downstream into pharmaceuticals and other specialty products, we are planting our flag squarely in basic chemicals -- materials that undergo one or more further conversions by our customers before they find their way to consumers," said Kennedy.
 "That's the realm in which our process technology leadership gives us a significant competitive edge," continued Kennedy. "It's also the segment of the industry where companies with the lowest conversion costs, the lowest overhead cost ratios, and the kind of organization that keeps customers happy -- can be vastly more profitable than the rest."
 Union Carbide's work now is centered on becoming that kind of company -- leveraging the competitive advantage it enjoys in businesses that account for about two thirds of its sales into an overall performance advantage, Kennedy said. "And doing it even faster than we thought possible when we began a few years back."
 Kennedy pointed out that the company's original target for cost reductions from the profit improvement program announced in December 1991 was $250 million for the corporation, including industrial gases. "Now we're targeting cost reductions of $400 million a year by the end of 1994 for the post spin-off chemical company alone," said Kennedy.
 "At the same time, we're consolidating offices, reducing layers of staffing, and linking compensation up and down the line more closely to business performance," he noted. "We've frozen senior management salaries until performance improves and eliminated bonuses this year for senior officers.
 "When we reach our 1994 performance targets, we believe the picture changes rapidly for Carbide," Kennedy said. "We'll be able to do a lot more for shareholders, employees and customers. And, we'll have the wherewithal to greatly enlarge our investment for growth."
 But amid all the change, Kennedy said there is one constant -- "our commitment to continuous improvement of our safety and environmental performance. We've worked hard to see that Carbide is out in front of the changes leading to a better and more responsive chemical industry."
 Between 1987 and 1990, for example, Union Carbide achieved a 50 percent reduction in carcinogens released to the air from its operations, and a 90 percent reduction in carcinogens released to the water. Last year the company spent $184 million for environmental protection, including remedial work, up from from $158 million the year before. In addition, $65 million of Union Carbide's capital expense was for projects associated with environmental protection.
 Union Carbide has also been one of the most avid supporters of the chemical industry's Responsible Care initiative, a public commitment to follow specific management practices aimed at upgrading environmental performance. "And we've been among the leaders in implementing its codes," said Kennedy. "Some will say we are not moving fast enough. But we're committed to more dialogue and more openness with our neighbors on any issue that involves their safety. We know what's at stake."
 Industrial Gases Chairman-Designate H. William Lichtenberger
 Outlines Strategy
 In his new role as chairman and chief executive officer-designate of the soon-to-be launched industrial gases business, H. William Lichtenberger told shareholders that the company will be a "strong and growing business, ranking approximately 175th on the Fortune 500 industrials list, with nearly $2.5 billion in consolidated annual sales in 1991.
 "Because the products we make and supply add value well beyond their cost to our customers' manufacturing processes or operations," said Lichtenberger, "our industry is expected to continue to grow faster than the economy in most areas of the industrial world. And because we are already geographically diverse, with more than half our sales outside the U.S., we are fully prepared to enter new world markets where the demand for our products and services is growing."
 Lichtenberger then outlined some of the business strategies that will enable his company to achieve its goal of becoming the best performing industrial gases company in the world. "First, we are managing costs stringently, spending only where we can create value," he said. "Second, we are developing and rapidly commercializing new technologies related to our products that stimulate growth or lower our costs for supplying them. And finally, we are working to generate greater cash flow from existing facilities in order to reinvest it for growth in our two core businesses.
 Lichtenberger noted that many of the company's new growth opportunities are the result of more stringent environmental requirements on its customers. An example is the increased demand for hydrogen -- driven by the Clean Air Act. "We have positioned ourselves well to be a major player in hydrogen supply, as evidenced by our recently announced joint venture agreement with Texaco to build, own and operate on-site hydrogen production facilities," Lichtenberger said. "We have also made a major commitment to pipeline hydrogen supply by authorizing the construction of a 70-mile pipeline in Texas.
 "We have 20,000 dedicated and highly motivated employees, in 15 countries around the world, who are looking forward to the challenge of taking on the competition and achieving our goal of becoming the best performing industrial gases company in the world," concluded Lichtenberger. "Our 75 years with Union Carbide have been good ones for us and we look forward to at least as many more under our own banner."
 -0- 4/22/92
 /CONTACT: Tomm F. Sprick of Union Carbide, 203-794-6992/
 (UK) CO: Union Carbide Corporation ST: Connecticut IN: CHM SU:


TS -- NY042 -- 1207 04/22/92 11:19 EDT
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Date:Apr 22, 1992
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