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 BOSTON, July 29 /PRNewswire/ -- Cabot Corporation (NYSE: CBT) today reported net income of $18.4 million (94 cents per common share), a third quarter earnings per share record, for the quarter ended June 30, 1993, up 12.2 percent from net income of $16.4 million (84 cents per common share) in the same quarter a year ago. Net sales and other operating revenues rose 12.9 percent to $418.8 million from $371.0 million last year.
 For the nine months ended June 30, 1993, Cabot reported income of $44.3 million ($2.23 per common share) from continuing operations compared with $55.1 million ($2.85 per common share) last year. Net sales were $1,222.5 million compared to $1,173.7 million last year.
 Cabot's total operating profit in the third quarter increased $4.5 million to $49.4 million from $44.9 million last year. Operating profit in the company's Specialty Chemicals and Materials Group was $46.1 million compare to $45.2 million, reflecting stronger margins and volumes in North America and Latin America offset by persistent weakness in European chemicals and continuing difficulties in Japan. Cabot's Energy Group, which traditionally is not profitable in the warmer months of the third quarter reported an operating profit of $3.3 million due to higher LNG sales, resulting from stronger spring pricing. Last year, the Energy Group reported a slight operating loss of $0.3 million in the quarter.
 Cabot Chairman Samuel W. Bodman said, "We are pleased to report encouraging results despite no signs of material improvement in the depressed business environments in Europe and Japan, two very important markets for Cabot. We continue to study the long term outlook for industrial production in Europe and the requirement for a restructuring that would provide for capacity reduction, administrative cost savings and other actions to improve operating efficiencies." In light of the current and anticipated business climate, Bodman indicated that the company may close several production lines and/or an entire plant and that, should the latter action become necessary, the total restructuring accrual could be as much as as $30 million after-tax. The company expects to make the decision during the current quarter and will record whatever restructuring accrual may be required at the end of this fiscal year.
 The company currently expects to adopt Financial Accounting Standard (FAS) 106, the accrual accounting for recognition of the estimated liability for post-retirement benefits, at the end of the current fiscal year. While Cabot has not yet completed its detailed analysis of the costs of adopting FAS 106, were it to recognize the entire cumulative effect of the charge this year, the company currently estimates a one- time charge of approximately $45 million after-tax without any cash flow impact.
 The company added that in one of the few remaining take-or-pay cases pending agaisnt it, the Supreme Court of Texas recently ruled against Cabot in a case in which Cabot had earlier prevailed. The case was returned to the appellate court for further consideration of the earlier trial court judgment against the company for $27.5 million. Previously recorded take-or-pay reserves are believed to be adequate to cover this and the other remaining take-or-pay cases.
 Bodman said in summary, "While in the aggregate, these non recurring charges would negatively impact fourth quarter results, we are greatly encouraged by the improved performance we have achieved in our core operations."
 Cabot Corporation is a Boston-based, Fortune 300 Company with operations in specialty chemicals and materials, and energy.
 Dollars in millions, except per share amounts (Unaudited)
 Periods ended June 30 Three Months Nine Months
 1993 1992 1993 1992
 Specialty chemicals and
 materials $319.3 $302.6 $903.9 $872.8
 Energy 99.5 68.4 318.6 300.9
 Net sales $418.8 $371.0 $1,222.5 $1,173.7
 Operating Profit (Loss):
 Specialty chemicals and
 materials $46.1 $45.2 $112.7 $126.1
 Energy 3.3 (0.3) 14.2 19.1
 Total operating profit $49.4 $44.9 $126.9 $145.2
 Income applicable to
 primary common shares:
 Interest expense $(11.2) $(11.3) $(33.7) $(29.5)
 General corporate expenses (7.0) (1.5) (17.1) (9.1)
 Income from continuing
 operations before income
 taxes 31.2 32.1 76.1 106.6
 Provision for income taxes(12.7) (15.2) (31.1) (50.2)
 Equity in net income (loss)
 of affiliated companies (0.1) (0.5) (0.7) (1.3)
 Net income 18.4 16.4 44.3 55.1
 Dividends on preferred
 stock (0.9) (0.9) (2.7) (2.8)
 Income applicable to
 primary common shares $17.5 $15.5 $41.6 $52.3
 Income per common share:
 Primary 94 cents 84 cents 2.23 2.85
 Fully diluted 88 cents 79 cents 2.09 2.65
 Average number of shares
 Primary 18,705 18,473 18,660 18,350
 Fully diluted 20,331 20,062 20,294 20,043
 (Dollars in thousands)
 June 30, 1993 Sept. 30, 1992
 Current assets:
 Cash and cash equivalents $22,180 $30,656
 Accounts and notes
 receivable 277,874 265,530
 Inventories 206,979 226,199
 Prepaid expenses 14,804 17,311
 Deferred income taxes 18,373 15,076
 Total current assets 540,210 554,772
 Current liabilities:
 Notes payable to banks 47,517 74,500
 Current portion of long-term
 debt 9,500 9,684
 Accounts payable and accrued
 liabilities 264,807 276,435
 U.S. and foreign income taxes 11,272 ---
 Total current liabilities 333,096 360,619
 Working capital 207,114 194,153
 Property, plant and
 equipment, at cost 1,224,777 1,274,656
 Accumulated depreciation,
 and amortization (584,309) (571,440)
 Net property, plant and
 equipment 640,468 703,216
 Investments 172,940 156,540
 Intangible assets, net of
 amortization 90,093 87,396
 Other assets 37,200 52,605
 Deferred income taxes (120,382) (119,917)
 Other deferred liabilities (73,623) (91,400)
 Total $953,810 $982,593
 Long-term debt $480,841 $479,882
 Minority interest --- 9,756
 Stockholders' equity 472,969 492,955
 Total capitalization $953,810 $982,593
 -0- 7/29/93
 /CONTACT: Kathryn I. Davis, director, investor relations of Cabot Corporation, 617-342-6366/

CO: Cabot Corporation ST: Massachusetts IN: CHM ENG SU: ERN

JL -- NE004 -- 7180 07/29/93 09:58 EDT
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Publication:PR Newswire
Date:Jul 29, 1993

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