Wellman Q1 op profits up 44% but charges leave $211m loss

22 April 2002 15:14  [Source: ICIS news]

HOUSTON (CNI)--Polyester and fibres producer Wellman said Monday first quarter net earnings from continuing operations increased 43.6% to $5.6m (Euro6.3m) on improved margins and reduced costs but the company still posted a net loss of $211.6m including all charges.

For the quarter ended 31 March, the Shrewsbury, New Jersey-based company reported diluted earnings/share (eps) from continuing operations of 18 cent compared to 12 cent in the year ago period.

Sales were off 11% to $239.4m.

Wellman took a $20m charge for discontinued operations and a $197m noncash goodwill accounting charge.

During the first quarter, Wellman announced the end of its yarn business in Fayetteville, North Carolina and its small polyester staple fibres business in Marion, South Carolina.

Including those charges, Wellman reported a net loss of $211.6m or $6.61 share compared to net income of $2.9m or 9 cent/share in the year ago period.

Wellman chairman and chief executive officer Thomas Duff said the company "experienced a significant improvement" in the first quarter compared to the fourth.

He added: "Our polyethylene terephthalate (PET) resin and polyester staple businesses are stronger as a result of increased end use demand and industry restocking of inventory. Overall, we expect our level of profitability from continuing operations for the remainder of 2002 to improve over first quarter levels.''

Wellman manufactures and markets high-quality polyester products and is the world's largest PET plastic recycler.

By: Mike Sheridan
+1 713 525 2653

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