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IMPERIAL CHEMICAL INDUSTRIES REPORTS 1992 HALF YEAR RESULTS

 IMPERIAL CHEMICAL INDUSTRIES REPORTS 1992 HALF YEAR RESULTS
 NEW YORK, July 30 /PRNewswire/ -- Imperial Chemical Industries PLC


of London today reported net income of $266 million for the second quarter of 1992, compared with $393 million for the same quarter in 1991. Net income per ADR was $1.49 on sales of $5.87 billion, which compares with $2.23 per ADR on sales of $6.30 billion in the second quarter of 1991.
 This brings net income for the first half on 1992 to $540 million, or $3.03 per ADR, on sales of $11.68 billion, which compares with $627 million, or $3.54 per ADR, on sales of $12.10 billion, in the comparative 1991 period.
 Chairman's Comments
 In announcing the results, Sir Denys Henderson, chairman of ICI, commented:
 "This morning we are making two separate press statements. One is the traditional comment on our results at the half year, while the other is that we are considering the possible demerger of our Bioscience interests. This would allow ICI and the Bioscience company, post separation, each to seize future opportunities and to respond more flexibly to economic conditions and to the changes in the shape of the chemical industry which will undoubtedly be necessary in the years ahead.
 Turning to the results, they reflect a very determined performance by all our businesses in difficult market conditions, with the six month operating income for Pharmaceuticals, Specialties and Materials ahead of last year. This recession is lasting longer and is deeper than most people originally expected, and the faint signs of recovery which we saw in the early spring of this year have faded. Where successes have been achieved they have been because of self-help and the determined control of costs on which businesses have been concentrating for the past two years. Our reshaping program is progressing well and we are achieving the benefits originally envisaged. To date, our savings from these programs are estimated to be running at an annual rate of $475 million.
 I will not make any predictions about the world economic scene, except to say that it will be very uncertain and that life will continue to be tough. There is little expectation of growth for the rest of the year and both cost reduction and cash conservation will therefore remain top priorities until economic recovery is really underway.
 Despite the difficult trading conditions we continue to maintain the strength of the balance sheet with the debt equity ratio virtually unchanged from the year end."
 Half Year
 Group sales in the first half of 1992 declined 4 percent compared with the same period in 1991 with lower local selling prices (-1 percent, mainly in Europe), reduced volumes (-1 percent) and the net effect of divestments (-3 percent), offset partly by favorable exchange movements (1 percent). The decline in sales occurred entirely in the second quarter.
 Operating income in Bioscience Products decreased from $735 million in 1991 to $637 million. Pharmaceuticals operating income was 3 percent above the 1991 level, with continuing strong growth in new products and a disposal gain being partly offset by the effects of competition for "Tenormin" in the U.S. market. Agrochemicals and Seeds operating income was 39 percent below last year because of wet weather and intensified price competition in the United States, as well as European concerns about the restructuring of the Common Agricultural Policy. Within the Specialty Chemicals and Materials businesses, Paints continued to perform well with underlying operating income ahead of 1991 which included a disposal gain. The improved performances in the specialties and materials businesses arose primarily from the cost reduction programs. In industrial chemicals, Tioxide performed will with an increase in earnings, but the sector's overall operating income declined due to the squeeze on margins exerted by the combination of recession and over-capacity.
 Second Quarter
 Income before tax in the second quarter was $192 million below the same period in 1991, with group sales 7 percent below the 1991 level and all the businesses reporting lower operating income.
 Pharmaceuticals operating income in the quarter was below last year's level due to lower sales in the United States reflecting different wholesaler purchasing patterns and generic competition to "Tenormin." Agrochemicals and Seeds operating income continued to be affected by intense price competition in the United States, the considerable unease about agricultural policy in Europe and by continuing credit problems in Eastern Europe.
 Specialities, Paint and Explosives had operating income at similar levels to 1991 as the difficult trading environment continued. Chemicals & Polymers, included in the Industrial Chemicals sector, continued to be adversely affected by the prolonged recession, with lower volumes and reduced selling prices
 Taxation
 The tax charge or the first six months amounted to $255m (1991 $334m), representing an effective tax rate of 32 percent, 1991 35 percent) and comprised UK corporation tax of $15m (1991 $67m) and taxation in respect of overseas and associated companies of $240m (1991 $267m). The tax rate in the first six months of 1992 reflected disposal gains which attracted reduced tax charges.
 Financial Summary
 The unaudited results for the second quarter and first half of 1992 are summarized in the following table, together with comparative figures for 1991.
 Periods ended Three months Six months
 June 30 1991 1992 1991 1992
 Sales $6.30bn $5.87bn $12.10bn $11.68m
 Income before tax 587m 395m 963m 798m
 Net income 393m 266m 627m 540m
 Earnings per ADR $2.23 $1.49 $3.54 $3.03
 Results for all periods have been expressed above in U.S. dollars at a convenient exchange rate of $1.90 to the pound, the rate prevailing on June 30, 1992. Four ICI one pound ordinary shares are represented by each ADR.
 results are based on United Kingdom accounting principles and are unaudited. Under U.S. Generally Accepted Accounting Principles net income for the half year ended June 30, 1992 would have been approximately $418m. The difference represents recurring differences between UK and US GAAP particularly in respect of purchase accounting adjustments and pension accounting.
 Interim Dividend
 The board has declared a first interim dividend of 21.0 pence per one pound ordinary share, in respect of the year 1992 (1991 first interim dividend 21 pence.) The total dividend for the year 1991 was 55 pence.
 The current income tax convention between the UK and the U.S. includes provisions which in effect, allow many U.S. resident ADR holders to receive this dividend gross of United Kingdom advance corporation tax, less a withholding tax which may, subject to certain limitations, be offset against U.S. federal taxes on overseas income.
 For ADR holders able to benefit fully under these arrangements, the first interim dividend of 21 pence per ordinary share would represent $2.13 per ADR using the conversion rate of one pound - U.S.$1.90.
 The record date for the 1992 first interim dividend payable to ICI ADR holders in Aug. 20, 1992 and payment will be made through Morgan Guaranty Trust Company on Oct. 13, 1992. ICI ADRs will trade ex- dividend on the New York Stock Exchange from Aug. 14, 1992.
 IMPERIAL CHEMICAL INDUSTRIES
 Segment Information
 (Dollars in millions)
 Sales Operating Income
 First Half 1991 1992 1991 1992
 Bioscience Products
 Pharmaceuticals 1,385 1,465 443 458
 Agrochemicals and seeds 1,522 1,461 292 179
 Total 2,907 2,926 735 637
 Specialty Chemicals
 And Materials
 Specialties 1,239 1,245 55 68
 Paints 1,499 1,552 108 104
 Materials 1,940 1,875 15 27
 Explosives 483 517 42 40
 Total(A) 5,119 5,147 220 239
 Industrial Chemicals 3,604 3,055 181 78
 Regional Business 1,178 1,117 6 -36
 Inter-class eliminations -709 -570 2 11
 ICI group total 12,099 11,675 1,144 929
 (A) Total excludes sales within the same class of business
 -0- 7/30/92
 /CONTACT: Vincent Leheny of ICI, 212-644-9274/
 (ICI) CO: Imperial Chemical Industries PLC ST: New York IN: CHM SU: ERN


KD-SM -- NY027 -- 5028 07/30/92 11:04 EDT
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