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GRACE REPORTS 1992 CORE BUSINESS OPERATING EARNINGS UP; SPECIAL CHARGES CAUSE LOSS FOR FULL YEAR; RESTRUCTURING PROGRESS CONTINUES UNABATED

 BOCA RATON, Fla., Feb. 4 /PRNewswire/ --W. R. Grace & Co. (NYSE: GRA) reported increased earnings for the fourth quarter and full year 1992 from the six core businesses which it has identified to lead its future growth. Collectively, operating earnings from this group improved 10 percent in the 1992 fourth quarter and 6 percent for the full year.
 For the company as a whole, fourth quarter 1992 operating earnings were $80.0 million or 89 cents per share compared to $91.0 million or $1.03 per share in the 1991 fourth quarter. Increased specialty chemicals and health care earnings and a reduction in interest expense were more than offset by shortfalls in non-core business profitability and increases in expenses associated with developmental activities and the implementation of the Company's new strategy.
 The company elected to classify its Colowyo Coal unit as a discontinued operation in the 1992 fourth quarter in recognition that Colowyo is not a long-term strategic business. As a result, all prior period operating results have been restated to eliminate the previously reported sales and earnings from Colowyo.
 Net income for the fourth quarter was $75.9 million, or 84 cents per share, compared to $80.6 million or 91 cents per share reported in the 1991 quarter, as restated. Sales amounted to $1.57 billion for the fourth quarter of 1992, up 6 percent from the prior year's restated quarter, reflecting strength in health care, packaging and catalysts.
 For the year 1992, Grace recorded a net loss of $294.5 million, or $3.29 per share, after special charges of $519.0 million -- $183.9 million, primarily relating to the classification of all of Grace's energy businesses as discontinued operations, a non-cash charge of $195.1 million for the adoption of FAS 106, and a mostly non-cash $140.0 million net charge in the third quarter reflecting the closure of its fumed silica plant in Belgium. Before the impact of these special charges, 1992 operating earnings were $224.5 million or $2.50 per share. Operating earnings, before the impact of discontinued operations and non-recurring items, were $239.4 million or $2.74 per share in 1991. Grace's 1991 net income was $218.6 million or $2.50 per share. Although income from operations in the 1992 fourth quarter was generally in line with expectations, the action to discontinue Colowyo resulted in reducing reported operating results for 1992 and increasing results for 1991. Sales amounted to $5.52 billion in 1992 vs. $5.57 billion for 1991. Increases in health care and core specialty chemicals businesses were reduced by the absence of revenues from various non-strategic operations which were divested earlier.
 "Clearly, 1992 was one of the most significant years of constructive change in the company's history," said J. P. Bolduc, president and chief executive officer. "Despite lower results from non-core businesses and our European specialty chemicals operations, we made significant progress implementing our


strategic plan:
 "The six core businesses in specialty chemicals and health care were
 restructured and are now globally focused. They continued their
 solid performance during a year of adverse economic conditions in
 several markets. "We have announced or completed transactions
 representing an additional $700 million of proceeds from
 divestments of non-strategic businesses, which brings the two-year
 total to more than $1.2 billion -- on track to complete our
 announced program of more than $1.5 billion of divestment proceeds
 by the end of 1993.
 "Our strategic plan is working. We continue to build a solid base for significantly improved performance and increased shareholder value as we look to 1993 and beyond," Bolduc said.
 Operating income after taxes from Grace's specialty chemicals business rose to $92.1 million in the 1992 fourth quarter, an increase of 8 percent over the prior year's quarter. Improvements were registered in packaging, with strength in most product areas in the U.S. and Latin America, and fluid cracking catalysts which combined increased volumes in the U.S. and Europe with lower costs. Weakness in European demand from the paper industry and planned business development costs contributed to lower earnings in water treatment, as North American results were nearly flat with a year ago. Sales of specialty chemicals in the 1992 quarter were $923 million, an 8 percent improvement compared to the 1991 fourth quarter.
 Grace's health care business continued its leading contribution to the Company's growth. Fourth quarter operating income increased 30 percent to $31.7 million on a 20 percent rise in sales to $345 million. Each sector of the operation -- dialysis services, medical products and home infusion and respiratory therapy services -- reported strong results in the quarter.
 In summing up, J. P. Bolduc added: "As we enter 1993, Grace is poised for improvements in operating earnings from our core businesses. We're confident that the restructuring actions taken in 1991 and 1992, however difficult and disappointing in the short term, will prove to be in the long term best interests of our shareholders.
 W. R. Grace & Co.
 Comparative Results
 ($ Millions Except Per Share)
 Percent
 1992 1991 Change
 FOURTH QUARTER
 Sales and Revenues $ 1,568.6 $ 1,483.2 5.8
 Income Before Taxes $ 122.2 $ 146.6 (16.6)
 Income Taxes 42.2 55.6 (24.1)
 Income From Continuing Ops $ 80.0 $ 91.0 (12.1)
 Loss From Discontinued Ops $ (4.1) (10.4) 60.6
 Net Income $ 75.9 $ 80.6 (5.8)
 Primary Earnings Per Share:
 Continuing Operations $ .89 $ 1.03 (13.6)
 Total $ .84 $ .91 (7.7)
 Fully Diluted Earnings Per Share:
 Continuing Operations .81 $ .95 (14.7)
 Total .77 $ .85 (9.4)
 YEAR TO DATE
 Sales and Revenues $ 5,518.2 $ 5,569.9 (0.9)
 Income Before Taxes $ 224.4 $ 395.7 (43.3)
 Income Taxes 145.0 152.8 (5.1)
 Income From Continuing Ops $ 79.4 (A) $ 242.9 (67.3)
 Loss From Discontinued Ops (183.9) (24.3) (656.8)
 Accounting Change --
 FAS 106 (190.0) --- ND
 Net (Loss)/Income $ (294.5) $ 218.6 (234.7)
 Primary Earnings/(Loss) Per Share:
 Continuing Operations $ .88 $ 2.78 (68.3)
 Accounting Change -
 FAS 106 $ (2.12) --- ND
 Total $ (3.29) $ 2.50 (231.6)
 Fully Diluted Earnings/(Loss) Per Share:
 Continuing Operations $ .88 $ 2.65 (66.8)
 Accounting Change --
 FAS 106 $ (2.12) --- ND
 Total $ (3.29) $ 2.40 (237.1)
 (A) -- 1992 includes a $140.0 provision which reflects the
 closure of the fumed silica plant.
 W. R. Grace & Co.
 Operating Results
 Quarter Ended Dec. 31
 ($ Millions Except Per Share)
 Percent
 1992 1991 Change
 Sales and Revenues
 Specialty Chemicals $ 922.9 $ 855.9 7.8
 Health Care 344.9 288.1 19.7
 Other Businesses 233.8 227.5 2.8
 Total Before D/V Units 1,501.6 1,371.5 9.5
 Divested Units (A) 67.0 111.7 (40.0)
 Total $ 1,568.6 $ 1,483.2 5.8
 Net Income
 Specialty Chemicals $ 92.1 $ 85.3 8.0
 Health Care 31.7 24.4 29.9
 Other Businesses 2.4 11.3 (78.8)
 Total Before D/V Units 126.2 121.0 4.3
 Divested Units (B) 6.2 2.2 181.8
 Total Operating Income $ 132.4 $ 123.2 7.5
 Other Expenses (C)
 Corporate Interest $ (13.1) $ (18.5) (29.2)
 Corporate Overhead (10.6) (9.8) 8.2
 Corporate R&D and Technical (9.9) (8.9) 11.2
 Other (18.8) 5.0 476.0
 Total Other Expenses $ (52.4) $ (32.2) 62.7
 Operating Earnings $ 80.0 $ 91.0 (12.1)
 Special Items
 Loss From
 Discontinued Op's $ (4.1) $ (10.4) 60.6
 Net Income $ 75.9 $ 80.6 (5.8)
 Primary Earnings Per Share:
 Operating Earnings $ .89 $ 1.03 (13.6)
 Net Income $ .84 $ .91 (7.7)
 Average Number of Shares
 (Millions) 89.8 88.6 1.4
 (A) -- Consists of sales of divested units (1992 -- Specialty
 Chemicals -- $67.0; 1991 -- Specialty Chemicals -- $68.6,
 Specialty Businesses -- $43.1).
 (B) -- Consists of net income of divested units (1992 -- Specialty
 Chemicals -- $.6.2; 1991 -- Specialty Chemicals -- $(2.0),
 Specialty Businesses -- $4.2).
 (C) -- Expenses not allocated to operating groups.
 W. R. Grace & Co.
 Operating Results
 Year Ended Dec. 31
 ($ Millions Except Per Share)
 Percent
 1992 1991 Change
 Sales and Revenues
 Specialty Chemicals $ 3,233.5 $ 3,083.1 4.9
 Health Care 1,275.2 1,060.5 20.2
 Other Businesses 767.5 781.5 (1.8)
 Total Before D/V Units 5,276.2 4,925.1 7.1
 Divested Units (A) 242.0 644.8 (62.5)
 Total $ 5,518.2 $ 5,569.9 (0.9)
 Net (Loss)/Income
 Specialty Chemicals $ 262.0 $ 273.6 (4.2)
 Health Care 105.7 82.9 27.5
 Other Businesses 14.4 34.9 (58.7)
 Total Before D/V Units 382.1 391.4 (2.4)
 Divested Units (B) 16.3 9.6 69.8
 Total Operating Income $ 398.4 $ 401.0 (0.6)
 Other Expenses (C)
 Corporate Interest $ (55.9) $ (82.0) (31.8)
 Corporate Overhead (39.2) (38.8) 1.0
 Corporate R&D and Technical (39.3) (35.2) 11.6
 Other (39.5) (5.6) 605.4
 Total Other Expenses $ (173.9) $ (161.6) 7.6
 Operating Earnings $ 224.5 $ 239.4 (6.2)
 Special Items
 Loss From Discontinued
 Op's (D) $ (183.9) $ (24.3) (656.8)
 Strategic Restructuring --- 3.5 (100.0)
 Accounting Change --
 FAS 106 (E) (195.1) --- ND
 Fumed Silica Plant Closure (140.0) --- ND
 Net (Loss)/Income $ (294.5) $ 218.6 (234.7)
 Primary Earnings/(Loss) Per Share:
 Operating Earnings $ 2.50 $ 2.74 (8.8)
 Net (Loss)/Income $ (3.29) $ 2.50 (231.6)
 Average Number of Shares
 (Millions) 89.5 87.2 2.6
 (A) -- Consists of sales of divested units (1992 -- Specialty
 Chemicals -- $242.0; 1991 -- Specialty Chemicals -- $396.5,
 Specialty Businesses -- $248.3).
 (B) -- Consists of net income of divested units (1992 -- Specialty
 Chemicals -- $16.3; 1991 -- Specialty Chemicals -- $(4.4),
 Specialty Businesses -- $14.0).
 (C) -- Expenses not allocated to operating groups.
 (D) -- 1992 primarily represents estimated loss on the sale of oil
 and gas businesses.
 (E) -- Represents a FAS 106 transitional obligation of $190.0, and
 an additional OPEB expense of $5.1 for the current year.
 -0- 2/4/93
 /CONTACT: Chuck Suits of W. R. Grace & Co., 407-362-2600 or 800-GRACE99/
 (GRA)


CO: W. R. Grace & Co. ST: Florida IN: CHM SU: ERN

JJ-AW -- FL014 -- 3169 02/04/93 16:29 EST
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Date:Feb 4, 1993
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