Third quarter 2016 GAAP earnings from continuing
operations of $0.39 per diluted share compared to $0.45 per diluted
share for the third quarter of 2015
Chemtura Corporation (NYSE:CHMT) (Euronext Paris:CHMT) (the
“Company,” “Chemtura,” “We,” “Us” or “Our”) today announced
financial results for the third quarter ended September 30,
2016. The Company also filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q for the quarter ended
September 30, 2016. For the third quarter of 2016,
Chemtura reported net sales of $414 million and net earnings from
continuing operations on a GAAP basis of $25 million, or $0.39 per
diluted share. Net earnings from continuing operations on a
Non-GAAP basis were $33 million, or $0.52 per diluted share.
Third Quarter 2016 Financial
Results
The discussion below includes financial
information on both a GAAP and Non-GAAP basis. Later in this
release we explain our Non-GAAP metrics including how each is
calculated, why we use the specific metric and the internal
controls around our Non-GAAP metrics. We have provided
reconciliations of our GAAP financial information to our Non-GAAP
financial metrics in the supplemental schedules attached to this
release. The use of Non-GAAP metrics is not a substitute for
GAAP measures and should not be considered as such.
The following is a summary of the unaudited financial
results on a GAAP and Non-GAAP basis (a description of our Non-GAAP
metrics appears later in this release):
(In
millions, except per share data) |
|
Quarters Ended - GAAP |
|
Quarters Ended - Non-GAAP |
|
|
September 30, |
September 30, |
|
|
September 30, |
September 30, |
|
|
|
2016 |
2015 |
% change |
|
2016 |
2015 |
% change |
Net sales |
|
$ |
414 |
|
$ |
444 |
|
(7 |
%) |
|
$ |
404 |
|
$ |
434 |
|
(7 |
%) |
Operating income |
|
$ |
51 |
|
$ |
53 |
|
(4 |
%) |
|
|
|
|
Earnings from
continuing operations |
|
$ |
25 |
|
$ |
31 |
|
(19 |
%) |
|
$ |
33 |
|
$ |
31 |
|
6 |
% |
Earnings from
continuing operations - per diluted share |
|
$ |
0.39 |
|
$ |
0.45 |
|
(13 |
%) |
|
$ |
0.52 |
|
$ |
0.45 |
|
16 |
% |
Adjusted EBITDA |
|
|
|
|
|
$ |
78 |
|
$ |
70 |
|
11 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CEO Remarks
“In the third quarter, we announced the sale of
Chemtura to Lanxess AG for $2.5 billion, or $33.50 per share,” said
Craig Rogerson, Chemtura’s Chairman, President and Chief Executive
Officer. “The planned sale to Lanxess is the culmination of
our stated goal to transform Chemtura into a larger, more diverse
and higher performing specialty chemical company. It provides
premium value to our shareholders and benefits our customers and
employees by making Chemtura part of a stronger global enterprise
with the resources to fully support a more diverse suite of
products and services.”
Commenting on third quarter performance, Mr.
Rogerson stated, “We carried our strong momentum from the first
half of 2016 into the third quarter. Operating income in both
of our Industrial segments improved sequentially and versus prior
year. In IEP, year-over-year improvement in operating income
was driven by better pricing for bromine products, stronger sales
of polymerization co-catalysts and improved plant performance,
offset by continued softness in clear brine fluids sales due to
stagnant oil and gas activity. Sequentially, operating income
in IEP improved as well, driven by higher sales of polymerization
co-catalysts, lower input costs for our bromine related products
and improved plant absorption in our organometallic product
lines.”
Mr. Rogerson continued, “In IPP, third quarter
operating income improved sequentially and compared to the same
period last year, despite lower overall sales. The
improvement in operating income was based in part on the benefit
received from lower raw material costs. The year-over-year
comparison also benefited from the absence of an inventory charge
that was taken in the third quarter of 2015.”
“Looking forward to the rest of 2016, fourth
quarter sales and operating income in our Industrial segments will
likely decline sequentially due to typical year-end order patterns,
but will be in line with our previous expectations,” said Mr.
Rogerson. “We anticipate that our performance over the final
quarter of the year will allow us to achieve our profitability
improvement goals for the full year that we described at our
Investor Day last December. In addition, we will remain fully
engaged in the process of executing the transaction with Lanxess,
which we expect will close by mid-2017.”
Pending merger transaction with
Lanxess
On September 25, 2016, we entered into an
agreement and plan of merger (the "Merger Agreement") with Lanxess
Deutschland GmbH, a limited liability company under the laws of
Germany ("Lanxess"), and LANXESS Additives Inc., a Delaware
corporation and an indirect, wholly owned subsidiary of Lanxess
("Merger Subsidiary"). Upon the terms, and subject to the
conditions set forth in the Merger Agreement, Merger Subsidiary
will merge with and into Chemtura (the "Merger"), with Chemtura
surviving the merger in an all-cash transaction in which Chemtura
stockholders will receive $33.50 in cash, without interest, per
share of Chemtura common stock, which represented an 18.9% premium
to the stock’s closing share price of $28.18 on September 23,
2016, the last trading day prior to the announcement of the
Merger.
The Merger is subject to customary closing
conditions. Assuming timely satisfaction of the necessary
closing conditions, we currently expect the Merger to close by
mid-2017.
Third Quarter Overview - GAAP
Basis
See tables that follow for a quantitative
summary of components of change by segment between the third
quarter of 2016 and the third quarter of 2015 (“year-over-year”)
and compared to the second quarter of 2016 (“sequential”)
Industrial Performance Products (“IPP”)
Our IPP segment delivered lower net sales and
higher operating income both year-over-year and sequentially.
Year-over-year, the reduction in net sales is
primarily the result of lower volume and lower sales prices.
During all of 2016, we continued to pass along the benefit of lower
raw material costs to certain of our customers coupled with sales
price declines for our urethane products most impacted by the weak
market demand in mining and oil and gas applications.
Additionally, the weak market demand for those same urethane
products resulted in volume declines year-over-year. In our
petroleum additives business, while we saw improvement in our
inhibitor products, which were partly associated with a temporary
shutdown of an Asian competitor's plant, those improvements were
offset by lower demand for petroleum additive synthetic lubricants
and basestocks products and for urethane products used in oil, gas
and mining applications. Sequentially, sales prices remained
relatively flat on lower volumes, primarily in our petroleum
additive products. We saw some modest improvement in demand
for urethane products used in mining applications but continued
weakness from oil and gas applications.
Operating income both year-over-year and
sequentially benefited from the net change in sales prices compared
to the change in raw material costs ("price-over-raw-materials")
and lower distribution and other costs. Included in the
change year-over-year is the absence of an inventory adjustment
that occurred in 2015 that did not repeat in 2016.
Additionally, included in the change sequentially is the absence of
a $2 million charge associated with the settlement of a state
excise tax matter which occurred in the second quarter of 2016.
Industrial Engineered Products (“IEP”)
Our IEP segment reported an improvement in
year-over-year net sales and operating income. On a
sequential basis, our IEP segment reported an increase in operating
income on lower net sales.
Year-over-year we saw a modest improvement in
net sales which was primarily driven by volume improvement in our
polymerization co-catalysts and from bromine, which had been
impacted in 2015 by a strike at a supplier, partially offset by
lower sales volume for our clear brine fluids used in the drilling
of deep offshore oil and gas wells as a result of market conditions
and lower oil pricing. Additionally, we realized a modest
improvement in sales prices and the favorable impact of foreign
exchange. Sequentially, the decline in net sales was the
result of lower demand for products used in electric and electronic
applications and tin specialty products offset by some increase in
bromine and bromine based derivative products and clear brine
fluids. Minor sales price fluctuations reflected some
weakening in the electric and electronic application products.
Operating income on both a year-over-year and
sequential basis was higher than the comparable periods. On a
year-over-year basis, favorable price-over-raws, product mix and
the effect of foreign exchange offset the impact of overall lower
volumes and a $2 million charge taken in the third quarter of 2016
related to an inventory adjustment for returned product.
Sequentially, we continued to see the benefit of favorable
price-over-raws, which offset both the reduction in volumes and the
$2 million charge for an inventory adjustment.
Corporate
Our Corporate segment expense decreased slightly
year-over-year primarily related to a reduction in amortization
expense. Our Corporate segment expense was flat
sequentially.
Contemporaneous with the execution of the Merger
Agreement, we entered into an agreement with SK Blue Holdings,
Ltd., and Addivant USA Holdings Corp (collectively, "Addivant")
that committed us to surrender our shares of Addivant preferred
stock to Addivant along with a cash payment of $1 million in
exchange for a modification of a non-compete agreement entered into
in conjunction with the sale of our antioxidants business to
Addivant in 2013. Reflecting the terms of this agreement, in
the third quarter of 2016, we took a charge of $5 million which is
included in the merger and integration costs described below.
The agreement with Addivant also provides for certain other changes
to our continuing supply agreements with Addivant that are
contingent upon the completion of the Merger.
During the third quarter of 2016, we recorded
$11 million of merger and integration costs, which primarily are
comprised of the legal and other fees associated with the signing
of the agreement with Lanxess and the charge related to the
Addivant preferred stock noted above.
Agrochemical Manufacturing Segment
The Agrochemical Manufacturing segment reported
lower net sales but operating income was flat both year-over-year
and sequentially.
The decrease in net sales was attributable to
the change from a supply agreement to a tolling agreement in Brazil
implemented earlier in 2016 (which reduced both net sales and cost
of sales with no impact on operating profit). We note that
the results include net sales and operating profit related to the
non-cash amortization, net of accretion, of a below-market contract
obligation that is related to our supply agreements. These
amounts were $10 million in the third quarter of 2016, the third
quarter of 2015 and the second quarter of 2016.
Income Taxes
Income tax expense on a GAAP basis was $17
million in the third quarter of 2016 compared with expense of $16
million in the third quarter of 2015 and expense of $13 million in
the second quarter of 2016.
For purposes of calculating our Non-GAAP
Earnings From Continuing Operations, we have applied a Non-GAAP tax
rate of 28% which is anticipated to be the annual income tax rate
as determined by U.S. GAAP accounting, adjusted to exclude the tax
effects of certain types of income and expense as listed in our
Non-GAAP Measures policy below.
Cash income taxes paid (net of refunds) for the
third quarter of 2016, the third quarter of 2015 and the second
quarter of 2016 were $13 million, $12 million and $7 million,
respectively.
Other Highlights
- Net cash provided by operating activities for the third quarter
of 2016 was $43 million as compared with net cash provided by
operating activities of $48 million for the third quarter of 2015
and net cash provided by operating activities of $76 million for
the second quarter of 2016. The cash contributions made to
our pension and post-retirement benefit plans in the third quarter
of 2016, the third quarter of 2015 and the second quarter of 2016
were $4 million, $18 million and $4 million, respectively.
- Capital expenditures for the third quarter of 2016 were $24
million compared to $21 million in the third quarter of 2015 and
$23 million in the second quarter of 2016.
- Our total debt was $479 million as of September 30, 2016
compared with $511 million as of December 31, 2015. The
decrease is primarily due to a prepayment of $39 million in the
second quarter of 2016 on our Term Loan due July 2017 (the "Term
Loan"). We repaid our Term Loan with cash on hand. Debt
as reported in our financial statements reflected the change in
U.S. GAAP in the first quarter of 2016 to now report debt net of
unamortized debt financing costs.
- Cash and cash equivalents were $202 million as of
September 30, 2016 compared with $323 million as of
December 31, 2015. The decrease was primarily the result
of capital expenditures, shares repurchased under our share
repurchase program, the $35 million contribution of cash to our
U.S. Qualified Pension Plan in the first quarter of 2016 and the
prepayment on the Term Loan.
Third Quarter Earnings Q&A
Teleconference
Copies of this release will be available on the
Investor Relations section of our website at
www.chemtura.com. We will host a teleconference to review
these results at 9:00 a.m. (EDT) on Tuesday, November 1,
2016. Interested parties are asked to dial in approximately
10 minutes prior to the start time. The call-in number for
U.S. based participants is (877) 494-3128 and for all other
participants is (404) 665-9523. The conference ID code is
92661219.
Replay of the call will be available for thirty
days, starting at 12 p.m. (EDT) on Tuesday, November 1, 2016.
To access the replay, call toll-free (855) 859-2056, (800)
585-8367, or (404) 537-3406, and enter access code 92661219.
An audio webcast of the call can be accessed via the link below
during the time of the call:
http://edge.media-server.com/m/p/yjhbtg4h
Chemtura Corporation, with 2015 net sales of
$1.7 billion, is a global manufacturer and marketer of specialty
chemicals. Additional information concerning us is available
at www.chemtura.com.
Non-GAAP Financial Measures
Certain information presented in this press
release and in the attached financial tables includes financial
measures that are not calculated or presented in accordance with
Generally Accepted Accounting Principles in the United States
(“GAAP”). We refer to those financial measures as “Non-GAAP”.
While GAAP provides a prescribed format for presenting financial
information, internally we have developed and use other financial
metrics and measures to make resource allocation decisions,
evaluate our underlying performance, compare that performance to
peer companies, identify operating trends, determine
performance-based compensation, and, among other factors, predict
future performance and cash inflows and outflows.
Understanding the Non-GAAP financial measures we use to manage our
business and resources provides our investors with insights that
cannot be obtained by a review of the GAAP based measures
alone. Many of the Non-GAAP financial measures we use in
managing our business can be calculated by investors and other
users of our financial statements; however, we provide this
information to the public to ensure there are not multiple
interpretations of the calculation of any such measure. To
assist our investors in understanding the differences between our
GAAP and Non-GAAP measures, we have provided a reconciliation
between these presentations in the attached financial tables.
Our Non-GAAP Financial Metrics and policies are
posted on our website at www.Chemtura.com so that they can be
easily referenced by our investors.
We use each of the following Non-GAAP measures
to provide investors and other users of our financial statements
with additional information to aid their understanding of our
primary business performance trends as well as our current and
future potential cash inflows and outflows:
Non-GAAP Net Sales - Included
in our presentation of GAAP Net Sales is the revenue accretion and
amortization of a below market contract liability related to the
supply agreements resulting from the sale of our Chemtura
AgroSolutions business. We excluded these revenues as the
accretion and amortization do not generate current or future cash
flows. We also exclude the benefit of this accretion and
amortization in computing Non-GAAP profitability measures.
Non-GAAP Adjusted EBITDA (Earnings
Before Interest, Taxes, Depreciation and Amortization)
- EBITDA is a financial measure frequently used by investors
and others to understand a company’s profitability as well as its
ability to meet debt service obligations, make investments and
compare performance and valuation to other companies. This
measure excludes cash and non-cash income or charges that exist in
a company’s GAAP presentation that do not necessarily represent
current or future cash inflows or outflows of business
operations. For example, depreciation and amortization are
charges that reduce a company’s net income, but reflect a historic
rather than current use of cash and share-based compensation
expense is a charge where there is no current use of cash.
This pre-tax measure also excludes interest expense as well as
other miscellaneous income and expense, such as realized and
unrealized foreign exchange gains and loss, that we have concluded
are not representative of current performance of our operating
businesses. Our calculation begins with GAAP Net Earnings
(Loss) from which we exclude GAAP income tax expense, GAAP interest
expense, GAAP depreciation and amortization, GAAP other income or
expense, the non-cash share-based compensation expense and certain
other income and charges as listed in the description of our
Non-GAAP policy below. It is also one of the performance
measures used to determine the amount, if any, of a payout under
our management incentive plans.
Non-GAAP Last Twelve Months (LTM)
Adjusted EBIDTA - Non-GAAP Adjusted EBITDA for any period
is calculated as noted above. Non-GAAP Adjusted EBITDA for
the annual period is one of the performance measures used to
determine the amount, if any, of a payout under our management
incentive plans. We utilize a rolling twelve month Non-GAAP
EBITDA metric to measure our progress against our annual targeted
Non-GAAP Adjusted EBITDA in any period. LTM Non-GAAP Adjusted
EBITDA is calculated by taking Non-GAAP Adjusted EBITDA for the
previous year-end period as filed in our Annual Report on Form 10-K
for the year-ended December 31, 2015, subtracting the Non-GAAP
Adjusted EBITDA as calculated based on the principles noted above
for the nine months ended September 30, 2015 and adding the
Non-GAAP Adjusted EBITDA as calculated based on the principles
noted above for the nine months ended September 30, 2016.
Non-GAAP Earnings (Loss) from Continuing
Operations Before Income Taxes - As defined by GAAP,
Earnings (Loss) from Continuing Operations Before Tax is a
sub-total that provides information regarding an entity’s results
of continuing operations excluding any amounts related specifically
to income taxes. It is calculated by taking Net Earnings
(Loss) and excluding any income or loss associated with
discontinued operations and any income tax expense. To
calculate Non-GAAP Earnings/(Loss) from Continuing Operations
Before Income Taxes, we start with GAAP Net Earnings (Loss) and
exclude any results related to discontinued operations, income tax
expense and certain other income and charges as listed in the
description of our Non-GAAP policy below. This sub-total is
necessary when computing income tax expense on an interim basis (as
described below) for both GAAP and Non-GAAP purposes.
Non-GAAP Income Tax Expense /
Benefit - The calculation of our GAAP income tax expense
or benefit in any interim period is based upon an estimate of our
effective tax rate for the annual period multiplied by our interim
GAAP Earnings (Loss) from Continuing Operations Before Income
Taxes, adjusted for discrete items if required. The
calculation of our Non-GAAP Income Tax Expense is based on the same
principles as our GAAP income tax expense; however, we exclude from
the calculation any tax associated with items that have been
excluded, or are projected to be excluded during the calendar year,
in our Non-GAAP Earnings (Loss) from Continuing Operations Before
Income Taxes, which are listed in the description of our Non-GAAP
policy below. We also exclude certain tax benefits and
expenses as described in our Non-GAAP policy below.
Application of the GAAP tax rate to our Non-GAAP Earnings (Loss)
from Continuing Operations Before Income Taxes would render an
income tax expense that does not correctly reflect the tax
associated with the pre-tax adjustments we make in our Non-GAAP
performance measures. The computation of an effective tax
rate reflecting the tax effect of our pre-tax Non-GAAP adjustments
permits the calculation of after tax Non-GAAP performance measures
and provides additional insights as to the underlying global tax
rate for our primary business operations. At the end of the
calendar year, we prepare a tax provision based on Non-GAAP
Earnings (Loss) from Continuing Operations Before Income Taxes,
excluding certain tax benefits and expenses as described in our
Non-GAAP policy below, in order to compute Non-GAAP Earnings (Loss)
from Continuing Operations (defined below) for the fourth quarter
and calendar year.
Non-GAAP Earnings (Loss) from Continuing
Operations - This measure is determined by applying
the Non-GAAP Effective Tax Rate for interim periods, or for the
calendar year, a tax provision, to our Non-GAAP Earnings (Loss)
from Continuing Operations Before Income Taxes and reducing the
Non-GAAP Earnings (Loss) from Continuing Operations Before Income
Taxes by that amount. The resulting measure is termed
Non-GAAP Earnings (Loss) from Continuing Operations. This
metric is intended to provide users of the financial statements
with an after tax profitability measure consistent with our pre-tax
Non-GAAP measure and is required to compute Non-GAAP Earnings
(Loss) Per Share from Continuing Operations.
Non-GAAP Earnings (Loss) Per Share from
Continuing Operations - To calculate this Non-GAAP
measure, we divide our Basic and Diluted Weighted Average Shares
into our Non-GAAP Earnings (Loss) from Continuing Operations.
To determine our Basic and Diluted Weighted Average Shares, we
utilize GAAP principles under both presentations. In many
periods, the GAAP and Non-GAAP Basis and Weighted Average Shares
are the same; however, should either the GAAP or Non-GAAP Earnings
(Loss) from Continuing Operations be anti-dilutive, the Diluted
Weighted Averages Shares may differ between the two
presentations. This measure is used as one of the criteria to
determine the amount, if any, of a payout under our management
incentive plans.
Free Cash Flow - We define Free
Cash Flow as Net Cash Provided by (Used in) Operating Activities
less GAAP capital expenditures and investments in intangible assets
as presented in our GAAP Consolidated Statement of Cash
Flows. It is intended to provide users of our financial
statements an indication of cash flows that are generated by or
used in our primary business operations alone. We caution
investors that this measure excludes Net Cash Provided by (Used in)
Financing Activities that can include mandatory debt service
obligations. It will also exclude investments such as
acquisitions or cash proceeds from divestitures. It includes
cash contributions to pension plans and post-retirement benefit
obligations as these are included in Net Cash Provided by (Used in)
Operating Activities. This measure therefore cannot be used
to understand changes in cash or in total indebtedness in any
reporting period.
Net Debt - The term Net Debt is
a Non-GAAP measure that is calculated from information in our GAAP
presentation. We add Short-term Borrowings and Long-term Debt
(combined “Total Debt”) less Cash and cash equivalents, all as
presented on our Condensed Consolidated Balance Sheet. This metric
provides users of our financial statements a view of our
indebtedness were we to use all our cash and cash equivalents on
hand to repay debt.
To ensure consistency in the presentation of
these Non-GAAP measures, we have developed an internal accounting
policy which specifies what types of income or expense are
considered to be adjustments to our GAAP financial results and
metrics. In practice, this policy is reviewed annually and
approved by our Disclosure Committee and the Audit Committee of our
Board of Directors. Our Non-GAAP financial measures have not
changed from the prior year, although in some years we do not have
certain transactions.
In accordance with our Non-GAAP accounting
policy, we adjust our pre-tax GAAP information for the following
items:
- costs associated with facility closures, severance and related
costs, including accelerated depreciation due to changes in the
useful life of assets, the accelerated recognition of asset
retirement obligations as a result of facility closures, and any
gain or loss on the disposal of any assets or facility that has
been closed;
- incremental environmental remediation charges resulting from a
facility closure or the sale of a business which are not considered
directly associated with our on-going operations;
- gains and losses on the sale of businesses or the formation of
joint ventures;
- gains or losses related to the early extinguishment of
debt;
- income and expense on legal settlements for any significant
matter or combination of related matters that is considered not
directly associated with our on-going operations;
- income and expense related to a major catastrophic event for
any matter or combination of related matters that is considered not
directly associated with our on-going operations;
- asset impairment charges;
- income or expense directly related to the purchase or sale of a
business which was incurred in the periods prior to the purchase or
sale but adjustments are only made after we have entered into a
definitive agreement and announced the transaction and prior to the
adoption of any discontinued operations treatment, if
applicable;
- income or expense directly associated with the Merger with
Lanxess, including those directly related to the transaction as
well as those directly attributable to the cost of
integration;
- gains or losses on the settlement or curtailment of our pension
plans or post-retirement plans which occurred as a result of
dispositions, mergers or significant plan amendments;
- gains or losses associated with the release of the Cumulative
Translation Adjustment upon the complete or substantial liquidation
of any majority-owned entities;
- revenue or other income associated with the recognition of the
fair value, net of accretion, of the significant below-market
contractual obligations related to the supply agreements with
Platform Specialty Products;
- tax expense or benefit associated with any of the pre-tax items
noted above;
- tax expense associated with the repatriation of net proceeds
resulting from the sale of a business;
- tax expense or benefit related to tax indemnification on the
sale of businesses for periods prior to the sale; and
- establishment or release of valuation allowance related to U.S.
Federal and state net operating losses ("NOLs") and Federal tax
credits generated prior to November 2010 and foreign NOLs of our
subsidiaries primarily related to former businesses.
Although we utilize Non-GAAP financial measures
internally to monitor and analyze our performance, determine
compensation under our management incentive plans and predict
future performance, investors should not consider them to be a
substitute for financial measures prepared in accordance with
GAAP. In addition, these Non-GAAP financial measures may be
calculated differently from similarly titled Non-GAAP financial
measures utilized by other companies and, therefore, should not be
used in a comparison of our performance relative to other companies
without further review of how others calculate these measures.
Forward-Looking Statements
This earnings press release contains
forward-looking statements based on management’s current
expectations, estimates and projections. All statements that
address expectations or projections about the future, including our
actions that will drive earnings growth, demand for our products
and expectations for growth, are forward-looking statements.
These statements are not guarantees of future performance and are
subject to risks, uncertainties, potentially inaccurate assumptions
and other factors, some of which are beyond our control and
difficult to predict. If known or unknown risks materialize,
or should underlying assumptions prove inaccurate, our actual
results could differ materially from past results and from those
expressed in forward-looking statements. Important factors
that could cause our results to differ materially from those
expressed in forward-looking statements include, but are not
limited to, economic, business, competitive, political, regulatory,
legal and governmental conditions in the countries and regions in
which we operate. These factors and others are discussed more
fully in the reports we file with the Securities and Exchange
Commission, particularly our latest annual report on Form
10-K. We assume no obligation to provide revisions to any
forward-looking statements should circumstances change, except as
otherwise required by securities and other applicable laws.
Changes to risk factors in the quarter ended September 30, 2016 are
set forth below:
- the occurrence of any event, change or other circumstance that
could give rise to the termination of the Merger Agreement,
including a termination of the Merger Agreement under circumstances
that could require Chemtura to pay a termination fee;
- the failure to receive, on a timely basis or otherwise, the
required approvals by Chemtura stockholders and government or
regulatory agencies with regard to the Merger Agreement;
- the risk that a closing condition to the Merger Agreement may
not be satisfied;
- Chemtura’s and Lanxess’ ability to complete the proposed Merger
on a timely basis or at all;
- the failure of the Merger to be completed on a timely basis or
at all for any other reason;
- the risks that Chemtura’s business may suffer as a result of
uncertainties surrounding the Merger;
- the ability of Chemtura to retain and hire key personnel and
maintain relationships with customers, suppliers and other business
partners pending the consummation of the Merger;
- the possibility of disruption to Chemtura’s business from the
proposed Merger, including increased costs and diversion of
management time and resources; and
- limitations placed on Chemtura’s ability to operate its
business under the Merger Agreement.
CHEMTURA CORPORATIONIndex of Financial
Statements and Schedules
|
Page |
|
|
Condensed Consolidated
Statements of Operations (Unaudited) - |
|
Quarters
ended September 30, 2016, June 30, 2016 and September 30, 2015 |
9 |
|
|
Segment Information
(Unaudited) - |
|
Quarters
ended September 30, 2016, June 30, 2016 and September 30, 2015 |
10 |
|
|
Condensed Consolidated
Balance Sheets - September 30, 2016 (Unaudited) and December 31,
2015 |
11 |
|
|
Condensed Consolidated
Statements of Cash Flows and Supplemental Data (Unaudited) - |
|
Quarters
ended September 30, 2016, June 30, 2016 and September 30, 2015 |
12 |
|
|
Major Factors Affecting
Net Sales and Operating Income (Unaudited) - |
|
Quarter
ended September 30, 2016 versus September 30, 2015 and June 30,
2016 |
13 |
|
|
Reconciliation of
Non-GAAP Metrics (Unaudited) - |
|
Quarters
ended September 30, 2016, June 30, 2016 and September 30, 2015 |
14 |
|
|
Reconciliation of GAAP
Net Earnings (Loss) to Segment and Total Adjusted EBITDA
(Unaudited) - |
|
Quarters
ended September 30, 2016, June 30, 2016 and September 30, 2015 |
15 |
|
|
Reconciliation of GAAP
Net Earnings (Loss) to Last Twelve Months Adjusted EBITDA
(Unaudited) |
16 |
|
|
|
|
CHEMTURA CORPORATIONCondensed
Consolidated Statements of Operations (Unaudited)(In
millions, except per share data)
|
|
Quarters Ended |
|
|
September 30, 2016 |
June 30, 2016 |
September 30, 2015 |
|
|
|
|
|
Net sales |
|
$ |
414 |
|
$ |
441 |
|
$ |
444 |
|
Cost of goods sold |
|
289 |
|
322 |
|
327 |
|
Gross profit |
|
125 |
|
119 |
|
117 |
|
Gross
profit % |
|
30 |
% |
27 |
% |
26 |
% |
|
|
|
|
|
Selling, general and
administrative |
|
35 |
|
37 |
|
36 |
|
Depreciation and
amortization |
|
21 |
|
22 |
|
22 |
|
Research and
development |
|
5 |
|
5 |
|
4 |
|
Facility closures,
severance and related costs |
|
1 |
|
— |
|
1 |
|
Merger and integration
costs |
|
11 |
|
— |
|
— |
|
Loss on sale of
business |
|
1 |
|
— |
|
1 |
|
Operating income |
|
51 |
|
55 |
|
53 |
|
Interest expense |
|
(8 |
) |
(8 |
) |
(7 |
) |
Other (expense) income,
net |
|
(1 |
) |
— |
|
1 |
|
Earnings from
continuing operations before income taxes |
|
42 |
|
47 |
|
47 |
|
Income tax expense |
|
(17 |
) |
(13 |
) |
(16 |
) |
Earnings from
continuing operations |
|
$ |
25 |
|
$ |
34 |
|
$ |
31 |
|
|
|
|
|
|
Per share
information: |
|
|
|
|
Earnings from
continuing operations - Basic |
|
$ |
0.40 |
|
$ |
0.54 |
|
$ |
0.46 |
|
Earnings from
continuing operations - Diluted |
|
$ |
0.39 |
|
$ |
0.53 |
|
$ |
0.45 |
|
|
|
|
|
|
Weighted average shares
outstanding - Basic |
|
63.0 |
|
63.5 |
|
67.5 |
|
Weighted average shares
outstanding - Diluted |
|
63.9 |
|
64.2 |
|
68.3 |
|
|
|
|
|
|
Comparison versus June
30, 2016: |
|
|
|
|
% change in net
sales |
|
(6 |
)% |
|
|
% change in operating
income |
|
(7 |
)% |
|
|
|
|
|
|
|
Comparison versus
September 30, 2015: |
|
|
|
|
% change in net
sales |
|
(7 |
)% |
|
|
% change in operating
income |
|
(4 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
CHEMTURA CORPORATIONSegment Information
(Unaudited)(In millions)
|
|
Quarters Ended |
|
|
September 30, 2016 |
June 30, 2016 |
September 30, 2015 |
NET
SALES |
|
|
|
|
Petroleum
additives |
|
$ |
140 |
|
$ |
154 |
|
$ |
156 |
|
Urethanes |
|
63 |
|
62 |
|
70 |
|
Industrial Performance
Products |
|
203 |
|
216 |
|
226 |
|
Bromine based &
related products |
|
142 |
|
148 |
|
144 |
|
Organometallics |
|
42 |
|
43 |
|
37 |
|
Industrial Engineered
Products |
|
184 |
|
191 |
|
181 |
|
Agrochemical
Manufacturing |
|
27 |
|
34 |
|
37 |
|
Total net
sales |
|
$ |
414 |
|
$ |
441 |
|
$ |
444 |
|
|
|
|
|
|
OPERATING
INCOME |
|
|
|
|
Industrial Performance
Products |
|
$ |
41 |
|
$ |
35 |
|
$ |
37 |
|
Industrial Engineered
Products |
|
28 |
|
25 |
|
24 |
|
Agrochemical
Manufacturing |
|
9 |
|
9 |
|
9 |
|
Segment operating
income |
|
78 |
|
69 |
|
70 |
|
General corporate
expense, including amortization |
|
(14 |
) |
(14 |
) |
(15 |
) |
Facility closures,
severance and related costs |
|
(1 |
) |
— |
|
(1 |
) |
Merger and integration
costs |
|
(11 |
) |
— |
|
— |
|
Loss on sale of
business |
|
(1 |
) |
— |
|
(1 |
) |
Total
operating income |
|
$ |
51 |
|
$ |
55 |
|
$ |
53 |
|
|
|
|
|
|
DEPRECIATION
AND AMORTIZATION |
|
|
|
|
Industrial Performance
Products |
|
$ |
7 |
|
$ |
8 |
|
$ |
7 |
|
Industrial Engineered
Products |
|
11 |
|
10 |
|
11 |
|
Agrochemical
Manufacturing |
|
1 |
|
1 |
|
1 |
|
General corporate
expense |
|
2 |
|
3 |
|
3 |
|
Total
depreciation and amortization |
|
$ |
21 |
|
$ |
22 |
|
$ |
22 |
|
|
|
|
|
|
NON-CASH SHARE-BASED COMPENSATION EXPENSE |
|
Industrial Performance
Products |
|
$ |
— |
|
$ |
1 |
|
$ |
— |
|
Industrial Engineered
Products |
|
— |
|
1 |
|
— |
|
General corporate
expense |
|
3 |
|
1 |
|
3 |
|
Total
non-cash share-based compensation expense |
|
$ |
3 |
|
$ |
3 |
|
$ |
3 |
|
|
|
|
|
|
|
|
|
|
|
CHEMTURA CORPORATIONCondensed
Consolidated Balance Sheets(In millions)
|
|
September 30, 2016 |
|
December 31, 2015 |
|
|
(Unaudited) |
|
|
ASSETS |
|
|
|
|
CURRENT ASSETS |
|
|
|
|
Cash and cash
equivalents |
|
$ |
202 |
|
|
$ |
323 |
|
Accounts receivable,
net |
|
219 |
|
|
210 |
|
Inventories, net |
|
328 |
|
|
315 |
|
Other current
assets |
|
134 |
|
|
130 |
|
Total
current assets |
|
883 |
|
|
978 |
|
NON-CURRENT ASSETS |
|
|
|
|
Property, plant and
equipment, net |
|
665 |
|
|
663 |
|
Goodwill |
|
162 |
|
|
166 |
|
Intangible assets,
net |
|
81 |
|
|
88 |
|
Deferred tax asset |
|
319 |
|
|
354 |
|
Other assets |
|
116 |
|
|
111 |
|
Total
Assets |
|
$ |
2,226 |
|
|
$ |
2,360 |
|
|
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
|
CURRENT
LIABILITIES |
|
|
|
|
Short-term
borrowings |
|
$ |
13 |
|
|
$ |
46 |
|
Accounts payable |
|
125 |
|
|
120 |
|
Accrued expenses |
|
126 |
|
|
142 |
|
Below market contract
obligation - current |
|
38 |
|
|
38 |
|
Income taxes
payable |
|
17 |
|
|
15 |
|
Total
current liabilities |
|
319 |
|
|
361 |
|
NON-CURRENT
LIABILITIES |
|
|
|
|
Long-term debt |
|
466 |
|
|
465 |
|
Pension and
post-retirement health care liabilities |
|
226 |
|
|
270 |
|
Below market contract
obligation - non-current |
|
117 |
|
|
145 |
|
Deferred tax
liability |
|
7 |
|
|
7 |
|
Other liabilities |
|
107 |
|
|
110 |
|
Total
liabilities |
|
1,242 |
|
|
1,358 |
|
|
|
|
|
|
TOTAL EQUITY |
|
984 |
|
|
1,002 |
|
Total
Liabilities and Equity |
|
$ |
2,226 |
|
|
$ |
2,360 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHEMTURA CORPORATIONCondensed
Consolidated Statements of Cash Flows and Supplemental Data
(Unaudited)(In millions)
|
|
Quarters Ended |
Increase (decrease) to
cash |
|
September 30, 2016 |
June 30, 2016 |
September 30, 2015 |
|
|
|
|
|
Condensed Consolidated Statements of Cash Flows
(Unaudited) |
Net cash
provided by operating activities |
|
$ |
43 |
|
$ |
76 |
|
$ |
48 |
|
Net cash
used in investing activities |
|
(24 |
) |
(23 |
) |
(21 |
) |
Net cash
used in financing activities |
|
(4 |
) |
(59 |
) |
(18 |
) |
Effect of
exchange rates on cash and cash equivalents |
|
1 |
|
(2 |
) |
(1 |
) |
Change in
cash and cash equivalents |
|
16 |
|
(8 |
) |
8 |
|
Cash and
cash equivalents at beginning of period |
|
186 |
|
194 |
|
309 |
|
Cash and
cash equivalents at end of period |
|
$ |
202 |
|
$ |
186 |
|
$ |
317 |
|
|
|
|
|
|
Supplemental
cash flow data: |
|
|
|
|
Changes
in accounts receivable |
|
$ |
21 |
|
$ |
(4 |
) |
$ |
33 |
|
Changes
in inventories |
|
$ |
(15 |
) |
$ |
11 |
|
$ |
(11 |
) |
Changes
in accounts payable |
|
$ |
— |
|
$ |
8 |
|
$ |
(5 |
) |
Changes
in pension and post-retirement health care liabilities |
|
$ |
(4 |
) |
$ |
(4 |
) |
$ |
(18 |
) |
|
|
|
|
|
Capital
expenditures |
|
$ |
(24 |
) |
$ |
(23 |
) |
$ |
(21 |
) |
Common
shares acquired |
|
$ |
(6 |
) |
$ |
(21 |
) |
$ |
(18 |
) |
Income
tax payments - net of refunds |
|
$ |
(13 |
) |
$ |
(7 |
) |
$ |
(12 |
) |
Interest
payments |
|
$ |
(14 |
) |
$ |
(1 |
) |
$ |
(14 |
) |
Cash
contributions to pension and post-retirement health care
liabilities |
|
$ |
(4 |
) |
$ |
(4 |
) |
$ |
(18 |
) |
|
|
|
|
|
Share
Repurchase Program: |
|
Shares purchased |
Cost of shares |
Remaining Authorization |
At
December 31, 2015 |
|
|
|
$ |
171 |
|
Nine
months ended September 30, 2016 share purchases |
|
4.5 |
|
$ |
116 |
|
$ |
54 |
|
|
|
|
|
|
Non-GAAP
Liquidity Measures |
|
Quarters Ended |
|
|
September 30, 2016 |
June 30, 2016 |
September 30, 2015 |
Free Cash
Flow: |
|
|
|
|
Net cash
provided by operating activities |
|
$ |
43 |
|
$ |
76 |
|
$ |
48 |
|
Capital
expenditures |
|
(24 |
) |
(23 |
) |
(21 |
) |
Free Cash
Flow |
|
$ |
19 |
|
$ |
53 |
|
$ |
27 |
|
|
|
As of |
Capitalization
data: |
|
September 30, 2016 |
June 30, 2016 |
September 30, 2015 |
Total
debt (a) (b) |
|
$ |
479 |
|
$ |
476 |
|
$ |
511 |
|
Cash and
cash equivalents |
|
202 |
|
186 |
|
317 |
|
Net Debt
(Total debt less Cash and cash equivalents) |
|
$ |
277 |
|
$ |
290 |
|
$ |
194 |
|
|
|
|
|
|
(a) - Total debt is net
of debt financing costs as follows: |
|
$ |
5 |
|
$ |
5 |
|
$ |
6 |
|
(b) - The
total debt balance for September 30, 2015 was adjusted by $6
million to conform with current period presentation |
which
reflects the change in U.S. GAAP to report debt net of unamortized
debt financing costs. |
|
|
CHEMTURA CORPORATIONMajor Factors
Affecting Net Sales and Operating Income (Unaudited) -
GAAP(In millions)
Net Sales |
|
Industrial Performance Products |
Industrial Engineered Products |
Agrochemical Manufacturing |
Total |
|
|
Quarter Ended
September 30, 2015 |
|
$ |
226 |
|
$ |
181 |
|
$ |
37 |
|
$ |
444 |
|
|
|
Changes in sales
prices |
|
(7 |
) |
— |
|
— |
|
(7 |
) |
|
|
Unit volume and
mix |
|
(16 |
) |
2 |
|
(10 |
) |
(24 |
) |
|
|
Foreign currency |
|
— |
|
1 |
|
— |
|
1 |
|
|
|
Quarter Ended
September 30, 2016 |
|
$ |
203 |
|
$ |
184 |
|
$ |
27 |
|
$ |
414 |
|
|
|
|
|
|
|
|
|
|
|
Quarter Ended
June 30, 2016 |
|
$ |
216 |
|
$ |
191 |
|
$ |
34 |
|
$ |
441 |
|
|
|
Changes in sales
prices |
|
(1 |
) |
(1 |
) |
— |
|
(2 |
) |
|
|
Unit volume and
mix |
|
(11 |
) |
(6 |
) |
(7 |
) |
(24 |
) |
|
|
Foreign currency |
|
(1 |
) |
— |
|
— |
|
(1 |
) |
|
|
Quarter Ended
September 30, 2016 |
|
$ |
203 |
|
$ |
184 |
|
$ |
27 |
|
$ |
414 |
|
|
|
|
|
|
|
|
|
|
|
Operating Income (Loss) |
|
Industrial Performance Products |
Industrial Engineered Products |
Agrochemical Manufacturing |
General corporate expense |
Other charges (a) |
Total |
Quarter Ended
September 30, 2015 |
|
$ |
37 |
|
$ |
24 |
|
$ |
9 |
|
$ |
(15 |
) |
$ |
(2 |
) |
$ |
53 |
|
Price-over-raw-materials |
|
4 |
|
3 |
|
— |
|
— |
|
— |
|
7 |
|
Unit volume and
mix |
|
— |
|
(1 |
) |
— |
|
— |
|
— |
|
(1 |
) |
Foreign currency |
|
— |
|
1 |
|
— |
|
— |
|
— |
|
1 |
|
Distribution cost |
|
1 |
|
— |
|
— |
|
— |
|
— |
|
1 |
|
Depreciation and
amortization expense |
|
— |
|
— |
|
— |
|
1 |
|
— |
|
1 |
|
Merger and integration
costs |
|
— |
|
— |
|
— |
|
— |
|
(11 |
) |
(11 |
) |
SG&A and Other |
|
(1 |
) |
1 |
|
— |
|
— |
|
— |
|
— |
|
Quarter Ended
September 30, 2016 |
|
$ |
41 |
|
$ |
28 |
|
$ |
9 |
|
$ |
(14 |
) |
$ |
(13 |
) |
$ |
51 |
|
|
|
|
|
|
|
|
|
Quarter Ended
June 30, 2016 |
|
$ |
35 |
|
$ |
25 |
|
$ |
9 |
|
$ |
(14 |
) |
$ |
— |
|
$ |
55 |
|
Price-over-raw-materials |
|
1 |
|
1 |
|
— |
|
— |
|
— |
|
2 |
|
Foreign currency |
|
— |
|
1 |
|
— |
|
— |
|
— |
|
1 |
|
Manufacturing cost and
absorption |
|
1 |
|
(1 |
) |
— |
|
— |
|
— |
|
— |
|
Distribution cost |
|
— |
|
2 |
|
— |
|
— |
|
— |
|
2 |
|
Depreciation and
amortization expense |
|
1 |
|
(1 |
) |
— |
|
1 |
|
— |
|
1 |
|
Facility closures,
severance and related costs |
|
— |
|
— |
|
— |
|
— |
|
(1 |
) |
(1 |
) |
Merger and integration
costs |
|
— |
|
— |
|
— |
|
— |
|
(11 |
) |
(11 |
) |
Loss on sale of
business |
|
— |
|
— |
|
— |
|
— |
|
(1 |
) |
(1 |
) |
SG&A and Other |
|
3 |
|
1 |
|
— |
|
(1 |
) |
— |
|
3 |
|
Quarter Ended
September 30, 2016 |
|
$ |
41 |
|
$ |
28 |
|
$ |
9 |
|
$ |
(14 |
) |
$ |
(13 |
) |
$ |
51 |
|
|
|
|
|
|
|
|
|
(a)
Includes facility closures, severance and related costs, merger and
integration costs and loss on sale of business. |
|
|
CHEMTURA CORPORATIONReconciliation of
Non-GAAP Metrics (Unaudited)(In millions, except per share
data)
|
|
Quarters Ended |
|
|
September 30, 2016 |
June 30, 2016 |
September 30, 2015 |
|
|
|
|
|
Reconciliation
of Non-GAAP Net Sales |
|
|
|
|
Net Sales - GAAP |
|
$ |
414 |
|
441 |
|
$ |
444 |
|
Below
market contract obligation |
|
(10 |
) |
(10 |
) |
(10 |
) |
Net Sales -
Non-GAAP |
|
$ |
404 |
|
$ |
431 |
|
$ |
434 |
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Net Earnings and Non-GAAP
Earnings Per Share |
|
Net earnings -
GAAP |
|
$ |
25 |
|
34 |
|
$ |
31 |
|
Below
market contract obligation |
|
(10 |
) |
(10 |
) |
(10 |
) |
Merger
and integration costs |
|
11 |
|
— |
|
— |
|
Other
charges |
|
2 |
|
— |
|
2 |
|
Income
tax expense |
|
17 |
|
13 |
|
16 |
|
Net earnings before tax
- Non-GAAP |
|
45 |
|
37 |
|
39 |
|
Income
tax expense - Non-GAAP |
|
(12 |
) |
(11 |
) |
(8 |
) |
Net earnings -
Non-GAAP |
|
$ |
33 |
|
$ |
26 |
|
$ |
31 |
|
|
|
|
|
|
Per share information
(GAAP): |
|
|
|
|
Net earnings -
Basic |
|
$ |
0.40 |
|
$ |
0.54 |
|
$ |
0.46 |
|
Net earnings -
Diluted |
|
$ |
0.39 |
|
$ |
0.53 |
|
$ |
0.45 |
|
|
|
|
|
|
Weighted average shares
outstanding - Basic |
|
63.0 |
|
63.5 |
|
67.5 |
|
Weighted average shares
outstanding - Diluted |
|
63.9 |
|
64.2 |
|
68.3 |
|
|
|
|
|
|
Per share information
(Non-GAAP): |
|
|
|
|
Net earnings -
Basic |
|
$ |
0.52 |
|
$ |
0.41 |
|
$ |
0.46 |
|
Net earnings -
Diluted |
|
$ |
0.52 |
|
$ |
0.40 |
|
$ |
0.45 |
|
|
|
|
|
|
Weighted average shares
outstanding - Basic |
|
63.0 |
|
63.5 |
|
67.5 |
|
Weighted average shares
outstanding - Diluted |
|
63.9 |
|
64.2 |
|
68.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHEMTURA CORPORATIONReconciliation of
GAAP Net Earnings (Loss) to Segment and Total Adjusted EBITDA
(Unaudited)(In millions)
September 30, 2016 |
|
Industrial Performance Products |
Industrial Engineered Products |
Agrochemical Manufacturing |
Corporate (a) |
Total |
Net earnings (loss) -
GAAP |
|
$ |
41 |
|
$ |
28 |
|
$ |
9 |
|
$ |
(53 |
) |
$ |
25 |
|
Interest
expense |
|
— |
|
— |
|
— |
|
8 |
|
8 |
|
Other
expense, net |
|
— |
|
— |
|
— |
|
1 |
|
1 |
|
Income
tax expense |
|
— |
|
— |
|
— |
|
17 |
|
17 |
|
Operating income
(loss) |
|
41 |
|
28 |
|
9 |
|
(27 |
) |
51 |
|
Depreciation and amortization |
|
7 |
|
11 |
|
1 |
|
2 |
|
21 |
|
Below
market contract obligation |
|
— |
|
— |
|
(10 |
) |
— |
|
(10 |
) |
Merger
and integration costs |
|
— |
|
— |
|
— |
|
11 |
|
11 |
|
Other
charges |
|
— |
|
— |
|
— |
|
2 |
|
2 |
|
Non-cash
share-based compensation |
|
— |
|
— |
|
— |
|
3 |
|
3 |
|
Adjusted EBITDA |
|
$ |
48 |
|
$ |
39 |
|
$ |
— |
|
$ |
(9 |
) |
$ |
78 |
|
|
|
|
|
|
|
|
June 30, 2016 |
|
|
|
|
|
|
Net earnings (loss) -
GAAP |
|
$ |
35 |
|
$ |
25 |
|
$ |
9 |
|
$ |
(35 |
) |
$ |
34 |
|
Interest
expense |
|
— |
|
— |
|
— |
|
8 |
|
8 |
|
Income
tax benefit |
|
— |
|
— |
|
— |
|
13 |
|
13 |
|
Operating income
(loss) |
|
35 |
|
25 |
|
9 |
|
(14 |
) |
55 |
|
Depreciation and amortization |
|
8 |
|
10 |
|
1 |
|
3 |
|
22 |
|
Below
market contract obligation |
|
— |
|
— |
|
(10 |
) |
— |
|
(10 |
) |
Non-cash
share-based compensation |
|
1 |
|
1 |
|
— |
|
1 |
|
3 |
|
Adjusted EBITDA |
|
$ |
44 |
|
$ |
36 |
|
$ |
— |
|
$ |
(10 |
) |
$ |
70 |
|
|
|
|
|
|
|
|
September 30, 2015 |
|
|
|
|
|
|
Net earnings (loss) -
GAAP |
|
$ |
37 |
|
$ |
24 |
|
$ |
9 |
|
$ |
(39 |
) |
$ |
31 |
|
Interest
expense |
|
— |
|
— |
|
— |
|
7 |
|
7 |
|
Other
income, net |
|
— |
|
— |
|
— |
|
(1 |
) |
(1 |
) |
Income
tax expense |
|
— |
|
— |
|
— |
|
16 |
|
16 |
|
Operating income
(loss) |
|
37 |
|
24 |
|
9 |
|
(17 |
) |
53 |
|
Depreciation and amortization |
|
7 |
|
11 |
|
1 |
|
3 |
|
22 |
|
Below
market contract obligation |
|
— |
|
— |
|
(10 |
) |
— |
|
(10 |
) |
Other
charges |
|
— |
|
1 |
|
— |
|
1 |
|
2 |
|
Non-cash
share-based compensation |
|
— |
|
— |
|
— |
|
3 |
|
3 |
|
Adjusted EBITDA |
|
$ |
44 |
|
$ |
36 |
|
$ |
— |
|
$ |
(10 |
) |
$ |
70 |
|
|
|
|
|
|
|
|
(a)
Includes general corporate expenses, facility closures, severance
and related costs, merger and integration costs and loss on sale of
business. |
|
|
CHEMTURA CORPORATIONReconciliation of
GAAP Net Earnings (Loss) to Last Twelve Months ("LTM") Adjusted
EBITDA (Unaudited)(In millions)
|
|
Year Ended |
|
Nine Months Ended |
|
LTM |
|
|
December 31, 2015 |
|
September 30, 2015 |
September 30, 2016 |
|
September 30, 2016 |
Net earnings (loss) -
GAAP |
|
$ |
136 |
|
|
$ |
70 |
|
$ |
(37 |
) |
|
$ |
29 |
|
Interest
expense |
|
30 |
|
|
23 |
|
24 |
|
|
31 |
|
Other
(income) expense, net |
|
(20 |
) |
|
(10 |
) |
3 |
|
|
(7 |
) |
Income
tax expense (benefit) |
|
16 |
|
|
43 |
|
15 |
|
|
(12 |
) |
Operating income |
|
162 |
|
|
126 |
|
5 |
|
|
41 |
|
Depreciation and amortization |
|
93 |
|
|
70 |
|
64 |
|
|
87 |
|
Operational facility closures, severance and related costs |
|
3 |
|
|
2 |
|
1 |
|
|
2 |
|
Merger
and integration costs |
|
— |
|
|
— |
|
11 |
|
|
11 |
|
Loss on
sale of business |
|
4 |
|
|
4 |
|
1 |
|
|
1 |
|
Pension
settlement |
|
— |
|
|
— |
|
162 |
|
|
162 |
|
Below
market contract obligation |
|
(38 |
) |
|
(29 |
) |
(29 |
) |
|
(38 |
) |
Non-cash
share-based compensation |
|
12 |
|
|
9 |
|
9 |
|
|
12 |
|
Other
adjustments |
|
1 |
|
|
— |
|
(1 |
) |
|
— |
|
Adjusted EBITDA |
|
$ |
237 |
|
|
$ |
182 |
|
$ |
223 |
|
|
$ |
278 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contact: Matthew Sokol 203-573-2153
Chemtura Corp. (delisted) (NYSE:CHMT)
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De May 2024 a Jun 2024
Chemtura Corp. (delisted) (NYSE:CHMT)
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