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MEAD REPORTS FOURTH QUARTER, YEAR-END RESULTS

 MEAD REPORTS FOURTH QUARTER, YEAR-END RESULTS
 DAYTON, Ohio, Jan. 23 /PRNewswire/ -- Mead Corporation (NYSE: MEA)


today reported sales of $1.09 billion for the fourth quarter of 1991 and $4.58 billion for the full year. These results compare to 1990 sales of $1.14 billion for the quarter and $4.77 billion for the full year.
 After previously reported special items, including a gain on the sale of a subsidiary, Mead's 1991 net earnings were $6.9 million, or 12 cents per share. Net earnings for 1991 without these special items would have been $70.8 million, or $1.21 per share.
 Net earnings for 1990 were $38.5 million, or 62 cents per share, after special items. Net earnings before special items were $161.9 million, or $2.60 per share. (See "Comparison of Quarterly Earnings" schedule below).
 Fourth quarter 1991 net earnings after special items were $8.2 million, or 14 cents per share. In 1990, Mead posted a fourth quarter loss of $92.9 million or $1.53 per share, chiefly due to writedowns of nonproductive assets and charges associated with the discontinuance of its color imaging business. Fourth quarter net earnings before special items were 23 cents per share in 1991, versus 22 cents per share for the fourth quarter of 1990.
 The special charges which affected full-year and fourth-quarter 1991 earnings were $10.0 million, or 17 cents per share, to increase the provision for estimated runoff costs for Mead's discontinued reinsurance business; $8.9 million, or 15 cents per share, to cover the cost of safeguarding landfills to meet environmental requirements; $7.6 million, or 13 cents per share, to cover charges associated with consolidations within some business units; and $5.1 million, or 9 cents per share, to cover previously incurred engineering costs.
 The sale of a medical information subsidiary, Micromedex, Inc., resulted in a net gain of $26.4 million, or 45 cents per share, in the fourth quarter. Micromedex had been a subsidiary of Mead Data Central, Inc., Mead's electronic publishing business, since 1985. Mead Data Central agreed to sell Micromedex in December 1991 and closed the transaction in January 1992.
 In addition, 1991 earnings were reduced by a charge of $58.7 million, or $1.00 per share, resulting from early adoption of FASB statement 106. This charge, primarily for retiree health care benefits, was taken against first quarter earnings, which will be restated.
 "The recession posed many challenges across the board," said Burnell R. Roberts, chairman and chief executive officer. "But despite the lagging economy, several of our businesses held their ground or made significant progress." Among those with higher earnings in 1991 were Mead's Packaging, Coated Board, School and Office Products, Gilbert Paper and Mead Data Central businesses.
 The biggest factor in the earnings decline was weak prices and demand for pulp and paper. This had a negative effect on earnings from Mead's paper divisions, as well as the Zellerbach distribution business.
 Prices for northern bleached kraft pulp declined steadily throughout the year, and averaged 28 percent below those of 1990. This severe price decline and operating problems during the first three quarters at Mead's jointly owned Canadian pulp mill penalized Mead's earnings by 52 cents per share relative to 1990.
 A surge of new capacity and weak economic conditions put pressure on prices for both coated and uncoated paper grades. Prices for coated publishing grades averaged 7 percent lower than a year ago. Coated printing grades, which were stable throughout most of the year, began to deteriorate at year end. Uncoated paper pricing began the year weak, temporarily strengthened in the third quarter, then returned to lower levels by year end.
 Sales volume for publishing paper produced at Mead's Michigan mill was even with the prior year, despite slack demand caused by a severe decline in magazine advertising. Volumes of both coated and uncoated grades manufactured at the company's Tennessee and Ohio mills declined from prior year levels. An unfavorable mix of products also reduced earnings from the paper segment overall.
 Earnings from Mead's coated board business showed significant improvement over a year ago. Prices rose slightly during the year for the company's Coated Natural Kraft (CNK) (R) paperboard. Tonnage sold from the newly expanded Alabama coated board mill increased 37 percent for the year.
 Sales were also higher at Mead's packaging division. Packaging volumes were up, particularly in international markets, during 1991. Mead Packaging continued to expand its European operations, opening a new packaging plant in the United Kingdom in the fourth quarter.
 Mead Containerboard's corrugating medium mill operated well throughout the year, although depressed prices reduced earnings for the division. Low volume and low prices continued to depress earnings from Mead's container plants, but improvements in operating efficiency helped offset the effect of market conditions on earnings.
 Within Mead's consumer and distribution segment, the recession had a greater impact on the distribution of paper, packaging and supplies than on school and office products. Sales and earnings at Zellerbach, Mead's distribution company, were substantially lower than a year ago. However, the division made progress during the year in realigning its logistics network to eliminate redundant facilities and adjust its staffing to optimize customer service.
 Mead's school and office products division achieved a significant increase in earnings, chiefly due to a favorable mix of value-added products for home and school use, as well as reduced costs.
 Mead Data Central's 1991 earnings before taxes were 30 percent higher than a year ago, excluding the impact of special items in both years. Prior year investments in quality enhancement projects began to pay off, as did tighter cost control measures. Sales revenue grew 7 percent, somewhat slower than in recent years, due to lower levels of activity in some of its customer base and the divestiture of a Canadian subsidiary in July 1990.
 "Most of Mead's businesses are closely tied to general economic activity," said Roberts. "Although we continue to take steps to streamline and strengthen our operations, economic conditions will need to pick up before these improvements will be fully reflected in earnings."
 SUMMARIZED FINANCIAL INFORMATION
 (all dollar amounts in millions, except EPS)
 Fourth Qtr. Ended Year Ended
 12/31/91 12/31/90 12/31/91 12/31/90
 NET SALES $1,094.8 $1,135.6 $4,579.3 $4,772.4
 Cost of Products Sold 876.9 920.8 3,712.2 3,850.4
 Gross Profit 217.9 214.8 867.1 922.0
 Selling, Admin. & Rsch. Exp. 168.4 163.8 634.7 617.6
 Other Expenses 34.5 83.5 34.5 88.5
 EARNINGS (LOSS) FROM OPNS. 15.0 (32.5) 197.9 215.9
 Other Revenues-Net 51.9 4.9 64.5 23.7
 Interest and Debt Expense (27.5) (28.2) (114.4) (92.6)
 EARN. (LOSS) FROM CONT. OPNS.
 BEFORE INCOME TAXES 39.4 (55.8) 148.0 147.0
 Income Taxes (Benefit) 15.7 (20.1) 54.3 52.3
 EARN. (LOSS) FROM CONT.
 OPNS. BEF. EQUITY IN NET
 EARNINGS (LOSS)
 OF JOINTLY OWNED COS. 23.7 (35.7) 93.7 94.7
 Equity in Net Earn. (Loss)
 of Jointly Owned Cos. (5.5) (3.8) (18.1) 11.7
 EARNINGS (LOSS) FROM
 CONTINUING OPERATIONS 18.2 (39.5) 75.6 106.4
 Loss from Discont. Opns. (10.0) (54.2) (10.0) (74.8)
 EARN. (LOSS) BEF. EXTRAORD. ITEM
 AND CUMUL. EFFECT OF CHANGE
 IN ACCOUNTING PRINCIPLE 8.2 (93.7) 65.6 31.6
 Extraordinary Item 0.8 6.9
 Cumul. Effect of Change
 in Accounting Principle (58.7)
 NET EARNINGS (LOSS) $ 8.2 $ (92.9) $ 6.9 $ 38.5
 Per Common and Common Equiv. Share:
 EARNINGS (LOSS) FROM
 CONTINUING OPERATIONS $ .31 $ (.65) $ 1.29 $ 1.71
 Loss from Discont. Opns. (.17) (.89) (.17) (1.20)
 EARN. (LOSS) BEF. EXTRAORD.
 ITEM & CUMUL. EFFECT OF
 CHANGE IN ACCTG. PRINCIPLE .14 (1.54) 1.12 .51
 Extraordinary Item .01 .11
 Cumul. Eff. of Acctg. Change (1.00)
 NET EARNINGS (LOSS) $ .14 $ (1.53) $ .12 $ .62
 Avg. Common & Common Equiv.
 Shares Outstanding (MM) 58.7 60.7 58.7 62.2
 Return on Average Share Owners' Equity
 - Latest 12 months
 Earnings from continuing operations (pct) 5.0 6.6
 COMPARISON OF QUARTERLY NET EARNINGS (LOSS)
 IN 1991 AND 1990
 Quarter 1991 1991 EPS Before 1990 1990 EPS Before
 EPS Special Items EPS Special Items
 First $(.77)a $ .23 $ .62 c $ .73
 Second .32 .32 .73 c .84
 Third .43 .43 .72 c,d,e .77
 Fourth .14 b .23 (1.53)c,d,e .22
 Full year $ .12 a,b $1.21 $ .62 c,d,e,f $2.60 f
 (a) -- Reflects an after-tax charge of $58.7 million ($1.00 per share) to cover the early adoption of FASB statement 106.
 (b) -- Reflects after-tax amounts as follows:
 -- $26.4 million gain (45 cents per share) on the sale of


Micromedex, Inc., a medical information subsidiary;
 -- $21.6 million charge (37 cents per share) to cover the costs of safeguarding landfills, consolidations within some business units, and previously incurred engineering costs;
 -- $10.0 million charge (17 cents per share) to increase the provision for estimated runoff costs for Mead's discontinued reinsurance business.
 (c) -- Reflects discontinued color imaging operations of $74.8 million ($1.20 per share) for the full year.
 (d) -- Reflects other charges to write off non-productive assets, record effect of voluntary early retirement program, and other smaller charges, all of which aggregated to $55 million (89 cents per share) for the full year.
 (e) -- Reflects gain on early retirement of debt totalling $6.9 million for full year (10 cents per share in the third quarter and 1 cent per share in the fourth quarter).
 (f) -- The sum of the quarterly EPS amounts in 1990 does not equal the full year EPS since the convertible debentures were dilutive in the first three quarters.
 SALES AND EARNINGS SEGMENT REPORTING FOR THE YEAR
 (dollar amounts in millions)
 Industry Segment Sales
 to Unaffiliated Customers:
 Full Year Ended
 Dec. 31, 1991 Dec. 31, 1990
 Paper $ 1,091.3 $ 1,178.1
 Paperboard & Packaging 1,022.8 970.2
 Distribution & School & Office 1,995.7 2,184.0
 Electronic Publishing 469.5 440.1
 TOTAL NET SALES $ 4,579.3 $ 4,772.4
 Industry Segment Earnings
 from Operations:
 Year Ended Dec. 31, 1991 Year Ended Dec. 31, 1990
 Earn.(Loss) Earn.(Loss)
 Before Before
 Special Special Earn. Special Special Earn.
 Items Items (Loss) Items Items (Loss)
 Paper $115.6 $20.7 $ 94.9 $196.5 $11.8 $184.7
 Ppbd. & Pkg. 115.7 1.6 114.1 103.5 6.1 97.4
 Dist. & Sch.
 & Office 41.0 9.2 31.8 56.9 58.6 (1.7)
 Elec. Pub. 44.5 3.0 41.5 34.2 6.4 27.8
 Corporate
 -Other Rev. 5.2 (44.1) 49.3 4.0 4.0
 -Interest (114.4) (114.4) (92.6) (92.6)
 -Other (69.2) (69.2) (67.0) 5.6 (72.6)
 Total $138.4 $(9.6) $148.0 $235.5 $88.5 $147.0
 -0- 1/23/92
 /CONTACT: Sharon Williamson of The Mead Corporation, 513-495-3535/
 (MEA) CO: Mead Corporation ST: Ohio IN: PAP SU: ERN


KK -- CL011 -- 2839 01/23/92 13:17 EST
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