OMNOVA Q4 net income jumps to $7.9m but sales fall 7.7%

21 January 2014 13:25 Source:ICIS News

HOUSTON (ICIS)--OMNOVA Solution’s fourth-quarter net income rose to $7.9m, from $700,000 in the same period a year ago, led by stronger results in the company's engineered surfaces business, the US-based producer of emulsion polymers, specialty chemicals and engineered surfaces said on Tuesday.

However, sales for the three months ended 30 November fell 7.7% year over year to $234.4m because of reduced pricing and lower volumes.

OMNOVA said that its engineered surfaces businesses had a favourable mix of business and reduced costs, resulting in its highest quarter and full-year operating profit since 2001, the company said.

"Engineered surfaces is benefiting from a lower cost structure as the result of a manufacturing footprint consolidation that was completed earlier in the year, and sales growth in the Asian automotive and the US housing and refurbishment markets," said CEO Kevin McMullen.

McMullen added that OMNOVA continues to work "on a number of key structural improvements" in its performance chemicals business that should positively contribute to results in coming quarters.

The improvements include the recent start-up of new specialty chemicals capabilities in China, styrene butadiene latex capacity rationalisation in North America, and several new product launches, the CEO said.

OMNOVA’s overall fourth-quarter segment operating profit was $21.7m, compared with $15.5m for the fourth quarter of 2012.

By Stefan Baumgarten