07 August 2008 14:30 [Source: ICIS news]
TORONTO (ICIS news)--PolyOne posted a second-quarter net profit of $8.8m (€5.7m) compared with a loss of $5.4m a year earlier as operating income nearly doubled and sales rose 8.6%, the US polymer producer said on Thursday.
Operating income for the three months ended 30 June was $24m, up from $12.4m in the 2007 second quarter, gross margin rose 7% to $88.5m and sales rose to $748m from $689m.
Last year’s second quarter included special items, in particular a $15.9m impairment charge for PolyOne’s former equity investment in OxyVinyls.
Excluding special items, PolyOne reported earnings per share of 12 cents, compared with 10 cents in the 2007 second quarter on a comparable basis.
“Our second quarter results continue to demonstrate the success of our transformation strategy allowing PolyOne to report earnings growth despite very challenging economic and inflationary conditions," said CEO Stephen Newlin.
Looking ahead, PolyOne expected continued economic uncertainty as well as continued raw material and energy cost pressure, it said.
While revenues for the six month to 31 December were expected to grow some 15% from the second half of 2007, earnings would be pressured, primarily in the company’s performance products and solutions segment, it said.
Market conditions in North America were expected to remain tough and there were signs of weakness in ?xml:namespace>
"We recently announced our plans to reduce capacity and realign assets in
“We are also seeing signs that European demand growth may be slowing, but it is too early to tell what impact, if any, this will have on our near-term consolidated results," he said.
PolyOne expected to fully implement the planned capacity reductions by the 2009 second quarter, generating annualised pre-tax savings of $17m, it added.
($1 = €0.65)
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