US PolyOne Q2 earnings fall 14% on higher administrative expenses

31 July 2012 23:28  [Source: ICIS news]

HOUSTON (ICIS)--US-based compounder PolyOne on Tuesday reported on Tuesday a second-quarter net income of $24.6m, down 14% form $28.5m reported for the same time last year, a drop partly attributed to an increase in administrative expenses.

Selling and administrative expenses reached $101.6m, up from $78.7m for the same time last year.

Second-quarter gross margins, however, reached $154.7m, up nearly 20% from $129.2m reported for the same time last year.

PolyOne reported revenue of $792.0m, a 3% increase over the $768.8m reported in the same quarter a year earlier.

The company said each of its three “strategic platforms” reported both operating margin expansion and operating income growth during the quarter.

The company posted one-time expenses of $11.8m related to special items in the second quarter, including an $8.7m charge of targeted cost-cutting actions in Europe and $2.9m in environmental remediation costs.

“We overcame weakness in European demand to deliver record quarterly adjusted earnings per share”, particularly because of the company’s acquisition of ColorMatrix and margin expansion in North America and Asia, Stephen Newlin, CEO, said in press release.

“Our progress in Asia continues to accelerate, having strengthened our commercial leadership in the region in 2011. Even if China’s economy slows in the quarters ahead, we expect to register solid results due to new business gains,” Newlin said.

Alluding to continuing concerns over the European fiscal crisis, Newlin said PolyOne continues “to expect to deliver record adjusted earnings per share in 2012, in line with our goal to consistently deliver double-digit [earnings per share] expansion”.

Cleveland, Ohio-based PolyOne manufactures thermoplastic resins and compounds, vinyl-based compounds, thermoplastic elastomers and colour and additive concentrates among its businesses.

($1 = €0.82)

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By: Ken Fountain

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