(Source: Business Wire)
Minerals Technologies Inc. (NYSE: MTX) today reported third
quarter diluted earnings per common share of $0.47 compared with a loss
of $2.18 per share in the second quarter of 2009. Earnings per share,
excluding special items from the company's second quarter 2009
restructuring, were $0.53 compared to $0.15 per share in the second
quarter. Net income for the quarter was $8.9 million compared to the
$40.9 million net loss recorded in the second quarter of 2009 largely as
a result of restructuring.
"Our financial results improved significantly over the second quarter,
with sales increasing across all of our major product lines, reflecting
our best performance since the recession severely affected our
operations in the fourth quarter of last year," said Joseph C. Muscari,
chairman and chief executive officer. "In addition, the restructuring
program we announced in July is ahead of schedule to meet the projected
$16 million to $20 million in annualized savings in 2010, and we have
achieved near-term productivity improvements to better position the
company for improved profitability."
Sequential Comparison
The company's worldwide sales in the third quarter increased 12 percent
to $234.3 million from $208.6 million in the second quarter. Income from
operations was $12.8 million compared to a loss of $41.6 million in the
second quarter. Excluding special items, income from operations was
$14.2 million, a 158-percent increase over the $5.5 million recorded in
the prior quarter. This growth was primarily due to volume increases in
both business segments, with the most significant improvement delivered
by the Refractories segment, and to the benefits from the restructuring
program.
The Specialty Minerals segment's worldwide sales in the third quarter
increased 7 percent to $162.5 million from $152.0 million in the prior
quarter. Income from operations, excluding special items, increased 20
percent to $15.8 million from $13.2 million in the second quarter. This
increase occurred in both the PCC and Processed Minerals product lines.
Worldwide sales of PCC, which is used primarily in the manufacturing
processes of the paper industry, were $137.5 million, an 8-percent gain
over the $127.7 million recorded in the prior quarter. This growth was
attributable to increased volumes, primarily in North America and
Europe, our largest markets, and to the favorable impact of foreign
exchange of $3.0 million or 2 percentage points of growth. Worldwide
unit volumes of Paper PCC were up approximately 4 percent from the
second quarter.
In Processed Minerals, third quarter sales increased 3 percent to $25.0
million from $24.3 million in the prior quarter. Volumes were up 6
percent from the second quarter of 2009. This product line returned to
profitability in the third quarter after a breakeven performance in the
second quarter and operating losses in the two previous quarters. This
business serves the residential and commercial construction markets
which typically experience a seasonal decline in the fourth quarter.
In the company's Refractories segment, sales for the third quarter were
$71.8 million, a 27-percent increase over the $56.6 million recorded in
the second quarter. Excluding special items, the segment recorded an
operating loss of $1.1 million compared to a loss of $7.1 million in the
second quarter, an 85-percent improvement.
Sales of refractory products and systems, used primarily in the steel
market, increased 22 percent in the third quarter to $56.8 million from
$46.7 million in the second quarter of 2009. This increase was
attributable to improved production rates in the worldwide steel
industry, which resulted in 17 percent higher volumes in refractory
products. Sales in the metallurgical product line increased 52 percent
sequentially to $15.0 million from $9.9 million in the previous quarter
due to volume increases of 80 percent.
Year-Over-Year Comparisons
Third Quarter
The company's third quarter net income of $8.9 million, or $0.47 per
share, compares with a net income of $19.0 million, or $1.00 per share,
in the third quarter of 2008. Earnings per share, excluding special
items, were $0.53 compared to $1.06 per share in the prior year.
Third quarter worldwide sales declined 21 percent to $234.3 million from
the $294.9 million recorded in the same period in 2008 as a result of
volume decreases in all businesses. Foreign exchange had an unfavorable
impact on sales of approximately $8.7 million or 3 percentage points.
Excluding special items, operating income of $14.2 million declined 49
percent from the $28.0 million recorded in the third quarter of 2008.
Third quarter worldwide sales for the Specialty Minerals segment
declined 13 percent to $162.5 million from the $186.7 million recorded
in the same quarter of 2008 due to volume decreases in both businesses.
Foreign exchange had an unfavorable impact on sales of approximately
$6.6 million, or 3 percentage points. Excluding special items, income
from operations decreased 6 percent to $15.8 million from the $16.8
million recorded in the same period in 2008.
PCC sales declined 13 percent from the $157.2 million recorded in the
third quarter of 2008 on a volume decline of about 11 percent. Processed
Minerals products third quarter sales were down 15 percent from the
$29.5 million in the same period last year, as volumes declined about 16
percent.
Refractories segment sales in the third quarter of 2009 were 34 percent
down from the $108.2 million recorded in the same period in 2008.
Refractory volumes declined 34 percent from the third quarter of 2008
and were in line with the reduction in steel production from
pre-recession levels. Metallurgical products sales declined 30 percent
from the $21.5 million recorded in the prior year. The Refractory
segment recorded an operating loss of $1.1 million, excluding special
items, compared to operating income of $11.6 million in the third
quarter of 2008.
Nine Months Results
The company recorded a net loss of $27.9 million for the first nine
months compared to net income of $59.6 million for the same period in
the prior year. The loss per share for the nine months was $1.49
compared to earnings of $3.12 earnings per share for the first nine
months in 2008. Excluding special items, earnings were $0.93 per share
as compared with $3.03 per share in the prior year.
Minerals Technologies' worldwide sales for the first nine months of 2009
decreased 25 percent to $651.1 million from $872.2 million in the same
period last year. Operating income, excluding special items, for the
nine months decreased 68 percent to $27.5 million compared to $86.2
million recorded in the prior year.
"Our performance in 2009 clearly reflects the effects of the economic
downturn and worldwide recession that accelerated in the fourth quarter
of 2008," said Mr. Muscari. "The actions we took throughout 2008
prepared us for the difficult economic environment in 2009. We were able
to respond quickly and effectively to reduce costs and to conserve
capital while continuing to focus on our new product development and
global growth initiatives."
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Minerals Technologies has scheduled an analyst conference call for
Friday, October 23, 2009 at 11:00 a.m. to discuss operating results for
the third quarter. The conference call will be broadcast over the
company's website, www.mineralstech.com.
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This press release may contain forward-looking statements, which
describe or are based on current expectations; in particular, statements
of anticipated changes in the business environment in which the company
operates and in the company's future operating results. Actual results
may differ materially from these expectations. In addition, any
statements that are not historical fact (including statements containing
the words "believes," "plans," "anticipates," "expects," "estimates,"
and similar expressions) should also be considered to be forward-looking
statements. The company undertakes no obligation to publicly update any
forward-looking statement, whether as a result of new information,
future events, or otherwise. Forward-looking statements in this document
should be evaluated together with the many uncertainties that affect our
businesses, particularly those mentioned in the risk factors and other
cautionary statements in our 2008 Annual Report on Form 10-K and in our
other reports filed with the Securities and Exchange Commission.
CONSOLIDATED STATEMENTS OF OPERATIONS
MINERALS TECHNOLOGIES INC. AND SUBSIDIARY COMPANIES
(in thousands, except per share data)
(unaudited)
Quarter Ended % Growth Nine Months Ended % Growth
Sept 27, 2009 June 28, 2009 Sept 28, 2008 Prior Year Prior Qtr. Sept 27, 2009 Sept 28, 2008 Prior Year
Net sales $ 234,256 $ 208,598 $ 294,917 (21 )% 12 % $ 651,113 $ 872,231 (25 )%
Cost of goods sold 190,266 176,192 235,482 (19 )% 8 % 541,473 689,779 (22 )%
Production margin 43,990 32,406 59,435 (26 )% 36 % 109,640 182,452 (40 )%
Marketing and administrative expenses 24,583 22,591 26,009 (5 )% 9 % 67,720 78,639 (14 )%
Research and development expenses 5,147 4,364 5,433 (5 )% 18 % 14,372 17,567 (18 )%
Impairment of assets 0 37,516 0 * * 37,516 0 *
Restructuring and other charges 1,443 9,553 5,013 (71 )% (85 )% 11,545 7,344 57 %
Income (loss) from operations 12,817 (41,618 ) 22,980 (44 )% * (21,513 ) 78,902 *
Non-operating income (deductions) - net (709 ) (3,535 ) 285 (349 )% * (4,499 ) (1,953 ) 130 %
Income (loss) from continuing operations, before tax 12,108 (45,153 ) 23,265 (48 )% * (26,012 ) 76,949 *
Provision for taxes on income 2,574 (8,632 ) 6,329 (59 )% * (4,106 ) 22,927 *
Income (loss) from continuing operations, net of tax 9,534 (36,521 ) 16,936 (44 )% * (21,906 ) 54,022 *
Income (loss) from discontinued operations, net of tax 279 (3,524 ) 2,951 (91 )% * (3,333 ) 7,973 *
Consolidated net income (loss) 9,813 (40,045 ) 19,887 (51 )% * (25,239 ) 61,995 *
Less: Net income attributable to non-controlling interests (913 ) (862 ) (879 ) 4 % 6 % (2,611 ) (2,445 ) 7 %
Net Income (loss) attributable to Minerals Technologies Inc.