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HANNA REPORTS STRONG 1992 EARNINGS AND REVISED FASB ESTIMATES

 CLEVELAND, Jan. 18 /PRNewswire/ -- M. A. Hanna Company (NYSE:MSE: MAH) today reported that earnings from continuing operations rose 21 percent, after the effects of the adoption of Financial Accounting Standards (FAS) 106 and 109, on a sales increase of 16 percent for the year ended Dec. 31, 1992. The company also said that FAS 109 will raise Hanna's effective tax rate for reporting purposes in future years; Hanna previously had indicated that the adoption of FAS 109 was not expected to impact future earnings.
 Annual sales and operating revenues in 1992 increased 16 percent to $1.33 billion, from $1.15 billion in 1991. Earnings from continuing operations for 1992 were $26.2 million, including a pretax charge of $3.9 million related to the adoption of FAS 106. The unfavorable impact on 1992 earnings from the adoption of FAS 109 was offset by favorable accrued tax liability changes. Before the effects of these items, earnings were $28.7 million or $1.45 per share, fully diluted.
 In 1992, Hanna realized a net gain of $4.3 million from discontinued operations, composed of $5.7 million from the settlement of a bankruptcy claim owed to a former natural resources affiliate, offset by a $1.4 million charge for a claim related to a minerals operation sold in 1988. The cumulative effect of the adoption of FAS 106 and 109 was a charge of $11.5 million, or $.58 per share, fully diluted. Including one-time items, net income for 1992 was $19.0 million, or $.96 per share, fully diluted.
 In 1991, Hanna incurred a loss from continuing operations of $16.7 million, or $.75 per share, fully diluted, which included charges of $35.0 million for a recapitalization program and $3.3 million for restructuring. Income from discontinued operations included a gain of $8.5 million from the sale of natural resources interests. Including one-time gains and losses, Hanna's 1991 net income was $844,000, or $.03 per share, fully diluted.
 The adoption of FAS 109 requires a company to adjust deferred tax assets and liabilities, with a corresponding adjustment reflected in current income tax expense. The adoption of FAS 109 caused the company to record deferred tax assets as a cumulative one-time benefit of $22.1 million. Further, the adoption will cause Hanna's ongoing effective tax rate to increase to an estimated 45 percent for reporting purposes. The higher tax rate is for reporting purposes only and will not impact the company's cash flow in 1993.
 "Hanna had an outstanding year and achieved most of its goals in a stubborn economy," said Chairman and Chief Executive Officer Martin D. Walker. "The adoption of FAS 106 and 109 has no impact on Hanna's outlook or cashflow."
 Fourth-quarter net sales and operating revenues increased 15 percent to $348.5 million in 1992 from $302.7 million in 1991.
 Net income in the fourth quarter of 1992 was $10.5 million, or $.53 per share, fully diluted. In the corresponding quarter of 1991, income from continuing operations was $4.0 million, or $.21 per share, fully diluted, excluding the one)time charge for restructuring. The fourth quarter 1992 results include the ongoing effect of the adoption of FAS 106 and 109 offset by favorable accrued tax liability charges. Excluding the effect of these items, earnings in the fourth quarter of 1992 would have been $7.6 million, or $.38 per share, fully diluted.
 Hanna's formulated polymers segment recorded pre-FASB operating income of $23.5 million in the fourth quarter of 1992 and $88.3 million for the full year, compared with 1991 operating income of $17.9 million in the fourth quarter and $71.6 million for the year.
 M. A. Hanna Company is a leading international specialty chemicals company. Primary businesses of M. A. Hanna are plastics and rubber compounding, color and additive concentrates, and distribution of plastic resins and engineered shapes.
 M. A. HANNA COMPANY AND CONSOLIDATED SUBSIDIARIES
 CONSOLIDATED BALANCE SHEETS
 (Unaudited)
 December December
 31, 1992 31, 1991
 (Dollars in thousands except per share data)
 Assets
 Current Assets
 Cash and cash equivalents $ 54,277 $ 24,478
 Short-term investments 25,702 -
 Receivables 201,695 158,227
 Inventories 126,230 109,670
 Other 31,518 3,384
 Total current assets 439,422 295,759
 Net Property, Plant and Equipment 224,773 216,717
 Other Assets
 Goodwill and other intangibles 400,389 387,357
 Investments and other 113,540 146,549
 Total other assets 513,929 533,906
 $1,178,124 $1,046,382
 Liabilities and Stockholders' Equity
 Current Liabilities
 Notes payable $ 2,312 $ 2,145
 Trade payables and accrued expenses 248,902 213,166
 Current portion of long-term debt 796 998
 Total current liabilities 252,010 216,309
 Other Liabilities 177,365 118,735
 Long-term Debt 350,806 330,880
 Stockholders' Equity 397,943 380,458
 $1,178,124 $1,046,382
 Long-term Debt/Total Capital 46.9 pct 46.5 pct
 M. A. HANNA COMPANY AND CONSOLIDATED SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF INCOME
 (Unaudited)
 Three Months Ended
 December 31
 1992 1991
 (Dollars in thousands except per share data)
 Net Sales and Operating Revenues $348,491 $302,719
 Costs and Expenses
 Cost of goods sold and operating expenses 269,528 232,724
 Selling, general and administrative 46,257 42,737
 Depreciation, depletion and amortization 12,069 10,505
 Other income (1,698) (808)
 Interest on debt 8,590 8,292
 Other expenses 2,613 6,495
 337,359 299,945
 Income (loss) from continuing operations
 before income taxes, extraordinary
 item and cumulative effect of change
 in accounting principles 11,132 2,774
 Income Taxes 612 2,085
 Income(loss) from continuing operations
 before extraordinary item and
 cumulative effect of change in
 accounting principles 10,520 689
 Income from Discontinued Operations - 12,779
 Income before extraordinary item 10,520 13,468
 Extraordinary Item - -
 Income before cumulative effect of
 change in accounting principles 10,520 13,468
 Cumulative effect of change in
 accounting principles - -
 Net Income 10,520 13,468
 Dividends on Preferred Stock - -
 Net income applicable to common stock $ 10,520 $ 13,468
 Income(loss) per share of common stock
 Primary
 Continuing operations $ .54 $ .04
 Discontinued operations - .68
 Extraordinary - -
 Cumulative effect of change
 in accounting principles - -
 Net income $ .54 $ .72
 Fully diluted
 Continuing operations $ .53 $ .04
 Discontinued operations - .66
 Extraordinary - -
 Cumulative effect of change
 in accounting principles - -
 Net income $ .53 $ .70
 Dividends per common share $ .175 $ .1625
 Year Ended
 December 31,
 1992 1991
 (Dollars in thousands except per share data)
 Net Sales and Operating Revenues $1,333,941 $1,148,202
 Costs and Expenses
 Cost of goods sold and operating expenses 1,037,971 874,829
 Selling, general and administrative 170,994 164,565
 Depreciation, depletion and amortization 47,905 43,228
 Other income (6,246) (3,234)
 Interest on debt 32,509 23,221
 Other expenses 9,186 46,431
 1,292,319 1,149,040
 Income(loss) from continuing operations
 before income taxes, extraordinary
 item and cumulative effect of change
 in accounting principles 41,622 (838)
 Income Taxes 15,400 15,910
 Income(loss) from continuing operations
 before extraordinary item and
 cumulative effect of change
 in accounting principles 26,222 (16,748)
 Income from Discontinued Operations 4,268 24,592
 Income before extraordinary item 30,490 7,844
 Extraordinary Item - (5,969)
 Income before cumulative effect of
 change in accounting principles 30,490 1,875
 Cumulative effect of change in
 accounting principles (11,465) -
 Net income 19,025 1,875
 Dividends on Preferred Stock - 1,031
 Net income applicable to common stock $ 19,025 $ 844
 Income(loss) per share of common stock
 Primary
 Continuing operations $ 1.37 $ (.75)
 Discontinued operations .22 1.04
 Extraordinary - (.25)
 Cumulative effect of change
 in accounting principles (.60) -
 Net income $ .99 $ .04
 Fully diluted
 Continuing operations $ 1.33 $ (.75)
 Discontinued operations .21 1.03
 Extraordinary - (.25)
 Cumulative effect of change
 in accounting principles (.58) -
 Net income $ .96 $ .03
 Dividends per common share $ .6625 $ .625
 -0- 1/18/93
 /CONTACT: Barbara Gould (investor), 216-589-4085; or Andy Opila (media), 216-589-4018; both of M.A. Hanna/
 (MAH)


CO: M.A. Hanna Company ST: Ohio IN: CHM SU: ERN

BM -- CL012 -- 6000 01/18/93 16:38 EST
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Date:Jan 18, 1993
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