Exhibit 99.1
FOR IMMEDIATE RELEASE
A. SCHULMAN REPORTS STRONG OPERATIONAL PERFORMANCE IN FISCAL 2015 SECOND QUARTER
| |
• | Solid gross margin expansion within legacy businesses in all regions, despite negative foreign currency translation |
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• | Net sales for the Company’s U.S. and Canada business increased over 22% compared with the prior-year period |
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• | Net loss from continuing operations of $888 thousand, or $0.03 per diluted share, includes impact of one-time CEO transition costs, restructuring, acquisition and integration and related costs; adjusted net income from continuing operations, excluding certain items, was $11.5 million, or $0.39 per diluted share, as previously estimated |
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• | Maintains previously revised full-year fiscal 2015 adjusted net income guidance to a range of $2.50 to $2.55 per diluted share, which does not include the impact of the previously announced acquisition of Citadel Plastics, which is expected to close on track in the third quarter of fiscal 2015 |
AKRON, Ohio - April 6, 2015 - A. Schulman, Inc. (Nasdaq-GS: SHLM) announced today earnings for the fiscal 2015 second quarter ended February 28, 2015.
Bernard Rzepka, president and chief executive officer, said, “I am encouraged by the improved operational results in all of our regions during the quarter, including the strong increase in our gross margins as a percent of revenue, compared to the year-ago quarter. These results are a testament to the success of our organic growth initiatives, relentless cost reduction and restructuring activities - as well as the contributions from well-integrated acquisitions - that delivered considerable offset against the negative impact of the rapid decline of the foreign currency.”
Fiscal Second-Quarter Results
Consolidated net sales for the fiscal 2015 second quarter were $542.3 million, compared with $588.5 million in the prior-year quarter. Foreign currency translation negatively impacted net sales by $59.7 million. Incremental net sales in the second quarter of fiscal 2015 from the Company’s recent acquisitions contributed $36.7 million. Gross margin, excluding certain items, in the second quarter as a percent of net sales improved to 14.5% compared with 12.8% in the prior-year period.
Rzepka continued, “Once again, EMEA not only held its own in a challenging environment, but was able to improve operating margins in local currencies during the second quarter of fiscal 2015. We achieved substantial progress in the U.S. and Canada business as a result of our focus on rebuilding our added-value businesses in this high-growth region. Latin America had been challenged in previous quarters but - through vigorous restructuring activities - we are very pleased to see meaningful progress being made. And in our APAC region, despite the competitive environment, we see continuing volume strength and gross margin expansion.”
EMEA net sales were $315.1 million compared with $383.0 million in the same prior-year period. Excluding the unfavorable impact of foreign currency translation of $51.7 million, sales declined by 4.2%, primarily due to lower sales prices as a result of declining raw material prices. These declines were partially offset by increased organic volumes in the Masterbatch Solutions product family, as well as the incremental contribution of the Ferro Specialty Plastics acquisition which increased net sales by $9.7 million. EMEA gross profit was $44.5 million. Excluding the
negative impact of foreign currency translation of $6.6 million, gross profit increased by $3.6 million, or 7.5%, primarily due to improved product mix and inventory management as well as the incremental contribution of the Ferro Specialty Plastics acquisition.
Net sales for the U.S. and Canada (“USCAN”) were $133.4 million, an increase of 22.8% in the second quarter compared with the prior-year period. During the second quarter, the incremental contribution of the Prime Colorants and Ferro Specialty Plastics acquisitions was $24.6 million in net sales. Excluding the impact of foreign currency translation and acquisitions, price per pound increased as a result of the Company’s strategy to improve product mix in the region. Foreign currency translation negatively impacted net sales by $0.4 million. USCAN gross profit was $19.7 million, an increase of $6.4 million from the same period last year. The benefits of recent acquisitions and related integration, along with improved mix on gross profit were partially offset by unfavorable foreign currency translation.
LATAM net sales for the quarter were $41.1 million, a decrease of $7.3 million compared with the prior-year period. Excluding the unfavorable impact of foreign currency translation, which decreased net sales by $5.6 million, average price per pound increased principally driven by improved product mix. LATAM gross profit was $7.1 million, a decrease of $0.8 million from the comparable period last year. The benefits of improved product mix were offset by unfavorable foreign currency translation of $0.9 million.
APAC net sales were $52.6 million, an increase of $4.2 million compared with the prior-year period. During the second quarter, the Compco acquisition contributed net sales of $2.4 million, which was offset by approximately $2.0 million negative impact of foreign currency translation. APAC gross profit was $7.4 million, an increase of $0.9 million compared with the prior-year period. Gross profit benefited from the positive contribution of the Compco acquisition and increased organic volume.
Working Capital/Cash Flow
Cash provided from operations was $1.1 million in the six months ended February 28, 2015, an improvement of $9.8 million. Working capital days for the second quarter of fiscal 2015 were approximately the same as the prior year quarter.
Capital expenditures for the quarter were $21.2 million, compared with $16.5 million for the prior-year quarter. These expenditures were primarily related to the regular and ongoing investment in the Company's global manufacturing facilities and technical innovation and collaboration centers. During the six months ended February 28, 2015, the Company declared and paid quarterly cash dividends of $0.41 per common share. The total amount of these dividends was $12.0 million.
Joseph Levanduski, chief financial officer, said, “Our balance sheet remains strong and continues to be a strength of this Company. We will maintain discipline as we approach the upcoming close of the previously announced Citadel acquisition, which is on track to close in the third quarter of fiscal 2015. Our operational performance remains strong even after giving full effect to the rapid foreign exchange impact.”
Year-to-Date Results
Net sales for the six months ended February 28, 2015 were $1,157.3 million, compared with $1,173.9 million for the same period last year. Incremental net sales for the six months from the Company’s recent acquisitions contributed $95.9 million. Foreign currency translation unfavorably impacted net sales for the six months ended February 28, 2015 by $85.9 million.
Operating Income before certain items for the six months ended February 28, 2015 was $47.0 million, an increase of $3.2 million compared to the same prior year period.
Business Outlook
Rzepka said, “We are again committed, despite the foreign currencies declines, to realize another year of earnings per share growth from our 2014 adjusted results of $2.36 per diluted share. On March 23, we revised our previously announced fiscal 2015 full-year adjusted net income guidance to $2.50 to $2.55 per diluted share, which is a 6 percent to 8 percent improvement in earnings despite the negative impact of the continuing steep decline of the euro and other foreign currencies. This revision in full-year guidance does not include any contributions from the pending acquisition of Citadel.”
Conference Call on the Web
A live Internet broadcast of A. Schulman’s conference call regarding fiscal 2015 second-quarter earnings can be accessed at 10:00 a.m. Eastern Time on Tuesday, April 7, 2015, on the Company’s website, www.aschulman.com. An archived replay of the call will also be available on the website.
Investor Presentation Materials
Senior executives of the Company may participate in meetings with analysts and investors throughout the fiscal year. The Company has posted presentation materials, portions of which may be used during such meetings, in the Investors section of its website at www.aschulman.com. The presentation will remain on the website as long as it is in use.
About A. Schulman, Inc.
A. Schulman, Inc. is a leading international supplier of high-performance plastic compounds and resins headquartered in Akron, Ohio. Since 1928, the Company has been providing innovative solutions to meet its customers' demanding requirements. The Company's customers span a wide range of markets such as packaging, mobility, building & construction, electronics & electrical, agriculture, personal care & hygiene, sports, leisure & home, custom services and others. The Company employs approximately 3,900 people and has 42 manufacturing facilities globally. A. Schulman reported net sales of approximately $2.5 billion for the fiscal year ended August 31, 2014. Additional information about A. Schulman can be found at www.aschulman.com.
Use of Non-GAAP Financial Measures
This release includes certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States (“GAAP”). These non-GAAP financial measures include segment gross profit, SG&A expenses excluding certain items, segment operating income, operating income before certain items, net income excluding certain items and net income per diluted share excluding certain items, as discussed further in the Reconciliation of GAAP and Non-GAAP Financial Measures below. These non-GAAP financial measures are considered relevant to aid analysis and understanding of the Company’s results and business trends. However, non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures, and tables included in this release reconcile each non-GAAP financial measure with the most directly comparable GAAP financial measure. The most directly comparable GAAP financial measures for these purposes are gross profit, SG&A expenses, operating income, net income and net income per diluted share. The Company's non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures, and should be read only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP.
While the Company believes that these non-GAAP financial measures provide useful supplemental information to investors, there are very significant limitations associated with their use. These non-GAAP financial measures are not prepared in accordance with GAAP, may not be reported by all of the Company’s competitors and may not be directly comparable to similarly titled measures of the Company’s competitors due to potential differences in the exact method of calculation. The Company compensates for these limitations by using these non-GAAP financial measures as supplements to GAAP financial measures and by reviewing the reconciliations of the non-GAAP financial measures to their most comparable GAAP financial measures.
Cautionary Statements
A number of the matters discussed in this document that are not historical or current facts deal with potential future circumstances and developments and may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historic or current facts and relate to future events and expectations. Forward-looking statements contain such words as "anticipate,” "estimate," "expect," "project," "intend," "plan," "believe," and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. Forward-looking statements are based on management's current expectations and include known and unknown risks, uncertainties and other factors, many of which management is unable to predict or control, that may cause actual results, performance or achievements to differ materially from those expressed or implied in the forward-looking statements. Important factors that could cause actual results to differ materially from those suggested by these forward-looking
statements, and that could adversely affect the Company's future financial performance, include, but are not limited to, the following:
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• | worldwide and regional economic, business and political conditions, including continuing economic uncertainties in some or all of the Company’s major product markets or countries where the Company has operations; |
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• | the effectiveness of the Company’s efforts to improve operating margins through sales growth, price increases, productivity gains, and improved purchasing techniques; |
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• | competitive factors, including intense price competition; |
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• | fluctuations in the value of currencies in areas where the Company operates; |
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• | volatility of prices and availability of the supply of energy and raw materials that are critical to the manufacture of the Company’s products, particularly plastic resins derived from oil and natural gas; |
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• | changes in customer demand and requirements; |
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• | effectiveness of the Company to achieve the level of cost savings, productivity improvements, growth and other benefits anticipated from acquisitions and the integration thereof, joint ventures and restructuring initiatives; |
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• | escalation in the cost of providing employee health care; |
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• | uncertainties regarding the resolution of pending and future litigation and other claims; |
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• | the performance of the global automotive market as well as other markets served; |
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• | further adverse changes in economic or industry conditions, including global supply and demand conditions and prices for products; |
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• | operating problems with our information systems as a result of system security failures such as viruses, cyber-attacks or other causes; |
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• | our ability to consummate the Citadel acquisition and the timing of the closing thereof for any reason, whether or not the fault of the Company; |
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• | the failure to obtain the necessary financing in connection with the Citadel acquisition for any reason, whether or not the fault of the Company; |
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• | the impact of the indebtedness incurred to finance the Citadel acquisition; |
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• | integration of the business of Citadel with our existing business, including the risk that the integration will be more costly or more time consuming and complex or simply less effective than anticipated; |
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• | our ability to achieve the anticipated synergies, cost savings and other benefits from the Citadel acquisition; |
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• | transaction and acquisition-related costs incurred in connection with the Citadel acquisition and related transactions; and |
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• | substantial time devoted by management to the integration after the closing of the Citadel acquisition. |
The risks and uncertainties identified above are not the only risks the Company faces. Additional risk factors that could affect the Company's performance are set forth in the Company's Annual Report on Form 10-K for the fiscal year ended August 31, 2014. In addition, risks and uncertainties not presently known to the Company or that it believes to be immaterial also may adversely affect the Company. Should any known or unknown risks or uncertainties develop into actual events, or underlying assumptions prove inaccurate, these developments could have material adverse effects on the Company's business, financial condition and results of operations.
Contact information:
Jennifer K. Beeman
Director of Corporate Communications & Investor Relations
A. Schulman, Inc.
3637 Ridgewood Road
Fairlawn, Ohio 44333
Tel: 330-668-7346
email: Jennifer.Beeman@aschulman.com
www.aschulman.com
A. SCHULMAN, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
|
| | | | | | | | | | | | | | | |
| Three months ended February 28, | | Six months ended February 28, |
| 2015 | | 2014 | | 2015 | | 2014 |
| Unaudited (In thousands, except per share data) |
Net sales | $ | 542,295 |
| | $ | 588,508 |
| | $ | 1,157,348 |
| | $ | 1,173,905 |
|
Cost of sales | 464,221 |
| | 514,209 |
| | 992,430 |
| | 1,020,498 |
|
Selling, general and administrative expenses | 70,093 |
| | 58,713 |
| | 130,640 |
| | 116,111 |
|
Restructuring expense | 2,662 |
| | 1,727 |
| | 7,881 |
| | 3,505 |
|
Asset impairment | — |
| | 104 |
| | — |
| | 104 |
|
Operating income | 5,319 |
| | 13,755 |
| | 26,397 |
| | 33,687 |
|
Interest expense | 2,311 |
| | 2,488 |
| | 4,670 |
| | 4,679 |
|
Interest income | (66 | ) | | (81 | ) | | (161 | ) | | (143 | ) |
Foreign currency transaction (gains) losses | 1,141 |
| | 1,466 |
| | 2,240 |
| | 2,148 |
|
Other (income) expense, net | (245 | ) | | (193 | ) | | (404 | ) | | (271 | ) |
Gain on early extinguishment of debt | (1,290 | ) | | — |
| | (1,290 | ) | | — |
|
Income (loss) from continuing operations before taxes | 3,468 |
| | 10,075 |
| | 21,342 |
| | 27,274 |
|
Provision (benefit) for U.S. and foreign income taxes | 3,971 |
| | 3,427 |
| | 8,457 |
| | 7,995 |
|
Income (loss) from continuing operations | (503 | ) | | 6,648 |
| | 12,885 |
| | 19,279 |
|
Income (loss) from discontinued operations, net of tax | (58 | ) | | 347 |
| | (68 | ) | | 3,002 |
|
Net income (loss) | (561 | ) | | 6,995 |
| | 12,817 |
| | 22,281 |
|
Noncontrolling interests | (327 | ) | | (136 | ) | | (547 | ) | | (351 | ) |
Net income (loss) attributable to A. Schulman, Inc. | $ | (888 | ) | | $ | 6,859 |
| | $ | 12,270 |
| | $ | 21,930 |
|
| | | | | | | |
Weighted-average number of shares outstanding: | | | | | | | |
Basic | 29,138 |
| | 29,059 |
| | 29,078 |
| | 29,038 |
|
Diluted | 29,138 |
| | 29,277 |
| | 29,538 |
| | 29,240 |
|
| | | | | | | |
Basic earnings per share attributable to A. Schulman, Inc. | | | | | | |
Income (loss) from continuing operations | $ | (0.03 | ) | | $ | 0.23 |
| | $ | 0.42 |
| | $ | 0.65 |
|
Income (loss) from discontinued operations | — |
| | 0.01 |
| | — |
| | 0.11 |
|
Net income (loss) attributable to A. Schulman, Inc. | $ | (0.03 | ) | | $ | 0.24 |
| | $ | 0.42 |
| | $ | 0.76 |
|
| | | | | | | |
Diluted earnings per share attributable to A. Schulman, Inc. | | | | | | |
Income (loss) from continuing operations | $ | (0.03 | ) | | $ | 0.22 |
| | $ | 0.42 |
| | $ | 0.65 |
|
Income (loss) from discontinued operations | — |
| | 0.01 |
| | — |
| | 0.10 |
|
Net income (loss) attributable to A. Schulman, Inc. | $ | (0.03 | ) | | $ | 0.23 |
| | $ | 0.42 |
| | $ | 0.75 |
|
| | | | | | | |
Cash dividends per common share | $ | 0.205 |
| | $ | 0.200 |
| | $ | 0.410 |
| | $ | 0.400 |
|
A. SCHULMAN, INC.
CONSOLIDATED BALANCE SHEETS
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| | | | | | | |
| February 28, 2015 | | August 31, 2014 |
| Unaudited (In thousands) |
ASSETS |
Current assets: | | | |
Cash and cash equivalents | $ | 91,872 |
| | $ | 135,493 |
|
Accounts receivable, less allowance for doubtful accounts of $9,520 at February 28, 2015 and $10,844 at August 31, 2014 | 354,257 |
| | 384,444 |
|
Inventories | 257,464 |
| | 292,141 |
|
Prepaid expenses and other current assets | 40,399 |
| | 40,473 |
|
Total current assets | 743,992 |
| | 852,551 |
|
Property, plant and equipment, at cost: | | | |
Land and improvements | 25,883 |
| | 28,439 |
|
Buildings and leasehold improvements | 144,951 |
| | 160,858 |
|
Machinery and equipment | 373,938 |
| | 398,563 |
|
Furniture and fixtures | 32,020 |
| | 41,255 |
|
Construction in progress | 20,523 |
| | 16,718 |
|
Gross property, plant and equipment | 597,315 |
| | 645,833 |
|
Accumulated depreciation | 357,346 |
| | 391,912 |
|
Net property, plant and equipment | 239,969 |
| | 253,921 |
|
Deferred charges and other noncurrent assets | 73,211 |
| | 65,079 |
|
Goodwill | 192,940 |
| | 202,299 |
|
Intangible assets, net | 123,932 |
| | 138,634 |
|
Total assets | $ | 1,374,044 |
| | $ | 1,512,484 |
|
LIABILITIES AND EQUITY |
Current liabilities: | | | |
Accounts payable | $ | 251,091 |
| | $ | 314,957 |
|
U.S. and foreign income taxes payable | 4,426 |
| | 6,385 |
|
Accrued payroll, taxes and related benefits | 42,232 |
| | 54,199 |
|
Other accrued liabilities | 46,067 |
| | 46,054 |
|
Short-term debt | 24,197 |
| | 31,748 |
|
Total current liabilities | 368,013 |
| | 453,343 |
|
Long-term debt | 365,406 |
| | 339,546 |
|
Pension plans | 112,501 |
| | 129,949 |
|
Deferred income taxes | 22,003 |
| | 23,826 |
|
Other long-term liabilities | 26,485 |
| | 29,369 |
|
Total liabilities | 894,408 |
| | 976,033 |
|
Commitments and contingencies | | | |
Stockholders’ equity: | | | |
Common stock, $1 par value, authorized - 75,000 shares, issued - 48,367 shares at February 28, 2015 and 48,185 shares at August 31, 2014 | 48,367 |
| | 48,185 |
|
Additional paid-in capital | 272,934 |
| | 268,545 |
|
Accumulated other comprehensive income (loss) | (73,801 | ) | | (16,691 | ) |
Retained earnings | 607,162 |
| | 606,898 |
|
Treasury stock, at cost, 19,079 shares at February 28, 2015 and 18,973 shares at August 31, 2014 | (383,170 | ) | | (379,894 | ) |
Total A. Schulman, Inc.’s stockholders’ equity | 471,492 |
| | 527,043 |
|
Noncontrolling interests | 8,144 |
| | 9,408 |
|
Total equity | 479,636 |
| | 536,451 |
|
Total liabilities and equity | $ | 1,374,044 |
| | $ | 1,512,484 |
|
A. SCHULMAN, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
| | | | | | | |
| Six months ended February 28, |
| 2015 | | 2014 |
| Unaudited (In thousands) |
Operating from continuing and discontinued operations: | | | |
Net income | $ | 12,817 |
| | $ | 22,281 |
|
Adjustments to reconcile net income to net cash provided from (used in) operating activities: | | | |
Depreciation | 17,990 |
| | 16,419 |
|
Amortization | 8,271 |
| | 6,669 |
|
Deferred tax provision (benefit) | (96 | ) | | (2,895 | ) |
Pension, postretirement benefits and other compensation | 6,173 |
| | 4,494 |
|
Restricted stock compensation - CEO transition costs, net of cash | 4,789 |
| | — |
|
Asset impairment | — |
| | 104 |
|
Gain on sale of assets from discontinued operations | — |
| | (3,331 | ) |
Changes in assets and liabilities, net of acquisitions: | | | |
Accounts receivable | (4,197 | ) | | (21,283 | ) |
Inventories | 3,838 |
| | (13,107 | ) |
Accounts payable | (38,126 | ) | | (15,534 | ) |
Income taxes | (1,210 | ) | | 229 |
|
Accrued payroll and other accrued liabilities | (3,159 | ) | | 375 |
|
Other assets and long-term liabilities | (6,003 | ) | | (3,100 | ) |
Net cash provided from (used in) operating activities | 1,087 |
| | (8,679 | ) |
Investing from continuing and discontinued operations: | | | |
Expenditures for property, plant and equipment | (21,238 | ) | | (16,541 | ) |
Investment in equity investees | (12,456 | ) | | — |
|
Proceeds from the sale of assets | 1,366 |
| | 4,738 |
|
Business acquisitions, net of cash | (6,698 | ) | | (115,624 | ) |
Net cash provided from (used in) investing activities | (39,026 | ) | | (127,427 | ) |
Financing from continuing and discontinued operations: | | | |
Cash dividends paid | (12,006 | ) | | (11,777 | ) |
Increase (decrease) in short-term debt | (3,415 | ) | | 2,469 |
|
Borrowings on long-term debt | 122,330 |
| | 686,955 |
|
Repayments on long-term debt including current portion | (91,381 | ) | | (583,914 | ) |
Payment of debt issuance costs | — |
| | (1,782 | ) |
Noncontrolling interests' contributions (distributions) | (1,750 | ) | | — |
|
Issuances of stock, common and treasury | 132 |
| | 276 |
|
Redemptions of common stock | (4,999 | ) | | (361 | ) |
Purchases of treasury stock | (3,335 | ) | | (1,116 | ) |
Net cash provided from (used in) financing activities | 5,576 |
| | 90,750 |
|
Effect of exchange rate changes on cash | (11,258 | ) | | 1,355 |
|
Net increase (decrease) in cash and cash equivalents | (43,621 | ) | | (44,001 | ) |
Cash and cash equivalents at beginning of period | 135,493 |
| | 134,054 |
|
Cash and cash equivalents at end of period | $ | 91,872 |
| | $ | 90,053 |
|
A. SCHULMAN, INC.
Reconciliation of GAAP and Non-GAAP Financial Measures
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Three months ended February 28, 2015 | | Cost of Sales | | Gross Margin | | SG&A | | Restructuring Expense | | Asset Impairment | | Operating Income | | Operating Income per Pound | | Income Tax Expense (benefit) | | Net Income Attributable to A. Schulman, Inc. | | Diluted EPS |
| | (In thousands, except for %'s, per pound and per share data) |
As reported | | $ | 464,221 |
| | 14.4 | % | | $ | 70,093 |
| | $ | 2,662 |
| | $ | — |
| | $ | 5,319 |
| | $ | 0.010 |
| | $ | 3,971 |
| | $ | (888 | ) | | $ | (0.03 | ) |
Certain items: | | | | | | | | | | | | | | | | | | | | |
Costs related to acquisitions and integrations (1) | | (65 | ) | | | | (3,272 | ) | | — |
| | — |
| | 3,337 |
| | | | 202 |
| | 3,135 |
| | 0.11 |
|
Restructuring and related costs (2) | | (298 | ) | | | | (819 | ) | | (2,662 | ) | | — |
| | 3,779 |
| | | | 519 |
| | 3,260 |
| | 0.11 |
|
CEO transition costs (3) | | — |
| | | | (6,167 | ) | | — |
| | — |
| | 6,167 |
| | | | — |
| | 6,167 |
| | 0.21 |
|
Asset write-downs (4) | | (298 | ) | | | | — |
| | — |
| | — |
| | 298 |
| | | | — |
| | 298 |
| | 0.01 |
|
Gain on early extinguishment of debt (6) | | — |
| | | | — |
| | — |
| | — |
| | — |
| | | | (428 | ) | | (863 | ) | | (0.03 | ) |
Tax benefits (charges) | | — |
| | | | — |
| | — |
| | — |
| | — |
| | | | (283 | ) | | 283 |
| | 0.01 |
|
Loss (income) from discontinued operations | | — |
| | | | — |
| | — |
| | — |
| | — |
| | | | | | 58 |
| | — |
|
Total certain items | | (661 | ) | | 0.1 | % | | (10,258 | ) | | (2,662 | ) | | — |
| | 13,581 |
| | 0.026 |
| | 10 |
| | 12,338 |
| | 0.42 |
|
As Adjusted | | $ | 463,560 |
| | 14.5 | % | | $ | 59,835 |
| | $ | — |
| | $ | — |
| | $ | 18,900 |
| | $ | 0.037 |
| | $ | 3,981 |
| | $ | 11,450 |
| | $ | 0.39 |
|
| | | | | | | | | | | | | | | | | | | | |
Percentage of Revenue | | | | | | 11.0 | % | | | | | | 3.5 | % | | | | | | 2.1 | % | | |
| | | | | | | | | | | | | | | | | | | | |
Three months ended February 28, 2014 | | Cost of Sales | | Gross Margin | | SG&A | | Restructuring Expense | | Asset Impairment | | Operating Income | | Operating Income per Pound | | Income Tax Expense (benefit) | | Net Income Attributable to A. Schulman, Inc. | | Diluted EPS |
| | (In thousands, except for %'s, per pound and per share data) |
As reported | | $ | 514,209 |
| | 12.6 | % | | $ | 58,713 |
| | $ | 1,727 |
| | $ | 104 |
| | $ | 13,755 |
| | $ | 0.027 |
| | $ | 3,427 |
| | $ | 6,859 |
| | $ | 0.23 |
|
Certain items: | | | | | | | | | | | | | | | | | | | | |
Costs related to acquisitions and integrations (1) | | (34 | ) | | | | (1,817 | ) | | — |
| | — |
| | 1,851 |
| | | | 30 |
| | 1,821 |
| | 0.06 |
|
Restructuring and related costs (2) | | (137 | ) | | | | (928 | ) | | (1,727 | ) | | — |
| | 2,792 |
| | | | 279 |
| | 2,513 |
| | 0.09 |
|
Asset write-downs (4) | | — |
| | | | — |
| | — |
| | (104 | ) | | 104 |
| | | | 34 |
| | 70 |
| | — |
|
Inventory step-up (5) | | (782 | ) | | | | — |
| | — |
| | — |
| | 782 |
| | | | — |
| | 782 |
| | 0.03 |
|
Tax benefits (charges) | | — |
| | | | — |
| | — |
| | — |
| | — |
| | | | 426 |
| | (426 | ) | | (0.01 | ) |
Loss (income) from discontinued operations | | — |
| | | | — |
| | — |
| | — |
| | — |
| | — |
| | — |
| | (347 | ) | | (0.01 | ) |
Total certain items | | (953 | ) | | 0.2 | % | | (2,745 | ) | | (1,727 | ) | | (104 | ) | | 5,529 |
| | 0.012 |
| | 769 |
| | 4,413 |
| | 0.16 |
|
As Adjusted | | $ | 513,256 |
| | 12.8 | % | | $ | 55,968 |
| | $ | — |
| | $ | — |
| | $ | 19,284 |
| | $ | 0.039 |
| | $ | 4,196 |
| | $ | 11,272 |
| | $ | 0.39 |
|
| | | | | | | | | | | | | | | | | | | | |
Percentage of Revenue | | | | | | 9.5 | % | | | | | | 3.3 | % | | | | | | 1.9 | % | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Six months ended February 28, 2015 | | Cost of Sales | | Gross Margin | | SG&A | | Restructuring Expense | | Asset Impairment | | Operating Income | | Operating Income per Pound | | Income Tax Expense (benefit) | | Net Income Attributable to A. Schulman, Inc. | | Diluted EPS |
| | (In thousands, except for %'s, per pound and per share data) |
As reported | | $ | 992,430 |
| | 14.2 | % | | $ | 130,640 |
| | $ | 7,881 |
| | $ | — |
| | $ | 26,397 |
| | $ | 0.025 |
| | $ | 8,457 |
| | $ | 12,270 |
| | $ | 0.42 |
|
Certain items: | | | | | | | | | | | | | | | | | | | | |
Costs related to acquisitions and integrations (1) | | (115 | ) | | | | (4,274 | ) | | — |
| | — |
| | 4,389 |
| | | | 278 |
| | 4,111 |
| | 0.14 |
|
Restructuring and related costs (2) | | (298 | ) | | | | (1,180 | ) | | (7,881 | ) | | — |
| | 9,359 |
| | | | 2,002 |
| | 7,357 |
| | 0.24 |
|
CEO transition costs (3) | | — |
| | | | (6,167 | ) | | — |
| | — |
| | 6,167 |
| | | | — |
| | 6,167 |
| | 0.21 |
|
Asset write-downs (4) | | (298 | ) | | | | — |
| | — |
| | — |
| | 298 |
| | | | — |
| | 298 |
| | 0.01 |
|
Inventory step-up (5) | | (341 | ) | | | | — |
| | — |
| | — |
| | 341 |
| | | | 102 |
| | 239 |
| | 0.01 |
|
Gain on early extinguishment of debt (6) | | — |
| | | | — |
| | — |
| | — |
| | — |
| | | | (428 | ) | | (863 | ) | | (0.03 | ) |
Tax benefits (charges) | | — |
| | | | — |
| | — |
| | — |
| | — |
| | | | (282 | ) | | 282 |
| | 0.01 |
|
Loss (income) from discontinued operations | | — |
| | | | — |
| | — |
| | — |
| | | | | | — |
| | 68 |
| | — |
|
Total certain items | | (1,052 | ) | | 0.1 | % | | (11,621 | ) | | (7,881 | ) | | — |
| | 20,554 |
| | 0.019 |
| | 1,672 |
| | 17,659 |
| | 0.59 |
|
As Adjusted | | $ | 991,378 |
| | 14.3 | % | | $ | 119,019 |
| | $ | — |
| | $ | — |
| | $ | 46,951 |
| | $ | 0.044 |
| | $ | 10,129 |
| | $ | 29,929 |
| | $ | 1.01 |
|
| | | | | | | | | | | | | | | | | | | | |
Percentage of Revenue | | | | | | 10.3 | % | | | | | | 4.1 | % | | | | | | 2.6 | % | | |
| | | | | | | | | | | | | | | | | | | | |
Six months ended February 28, 2014 | | Cost of Sales | | Gross Margin | | SG&A | | Restructuring Expense | | Asset Impairment | | Operating Income | | Operating Income per Pound | | Income Tax Expense (benefit) | | Net Income Attributable to A. Schulman, Inc. | | Diluted EPS |
| | (In thousands, except for %'s, per pound and per share data) |
As reported | | $ | 1,020,498 |
| | 13.1 | % | | $ | 116,111 |
| | $ | 3,505 |
| | $ | 104 |
| | $ | 33,687 |
| | $ | 0.034 |
| | $ | 7,995 |
| | $ | 21,930 |
| | $ | 0.75 |
|
Certain items: | | | | | | | | | | | | | | | | | | | | |
Costs related to acquisitions and integrations (1) | | (34 | ) | | | | (2,453 | ) | | — |
| | — |
| | 2,487 |
| | | | 125 |
| | 2,370 |
| | 0.08 |
|
Restructuring and related costs (2) | | (500 | ) | | | | (2,159 | ) | | (3,505 | ) | | — |
| | 6,164 |
| | | | 601 |
| | 5,852 |
| | 0.20 |
|
Asset write-downs (4) | | (108 | ) | | | | — |
| | — |
| | (104 | ) | | 212 |
| | | | 34 |
| | 178 |
| | 0.01 |
|
Inventory step-up (5) | | (1,199 | ) | | | | — |
| | — |
| | — |
| | 1,199 |
| | | | 98 |
| | 1,101 |
| | 0.04 |
|
Tax benefits (charges) | | | | | | | | | | | | — |
| | | | 427 |
| | (427 | ) | | (0.02 | ) |
Loss (income) from discontinued operations | | | | | | | | | | | | | | | | | | (3,002 | ) | | (0.10 | ) |
Total certain items | | (1,841 | ) | | 0.1 | % | | (4,612 | ) | | (3,505 | ) | | (104 | ) | | 10,062 |
| | 0.010 |
| | 1,285 |
| | 6,072 |
| | 0.21 |
|
As Adjusted | | $ | 1,018,657 |
| | 13.2 | % | | $ | 111,499 |
| | $ | — |
| | $ | — |
| | $ | 43,749 |
| | $ | 0.044 |
| | $ | 9,280 |
| | $ | 28,002 |
| | $ | 0.96 |
|
| | | | | | | | | | | | | | | | | | | | |
Percentage of Revenue | | | | | | 9.5 | % | | | | | | 3.7 | % | | | | | | 2.4 | % | | |
1 - Costs related to acquisitions and integrations primarily include third party professional, legal, IT and other expenses associated with successful and unsuccessful full or partial acquisition and divestiture/dissolution transactions, as well as certain employee-related expenses such as travel, one-time bonuses and post-acquisition severance separate from a formal restructuring plan.
2 - Restructuring and related costs include items such as employee severance charges, lease termination charges, curtailment gains/losses, other employee termination costs and charges related to the reorganization of the legal entity structure.
3 - CEO transition costs represent a one-time charge for the modification and accelerated vesting upon retirement of the outstanding equity compensation awards granted to Joseph M. Gingo in 2013 and 2014.
4 - Asset write-downs primarily relate to asset impairments and accelerated depreciation.
5 - Inventory step-up costs represent the amortization of adjustments to fair value of inventory acquired for acquisition purchase accounting.
6 - Represents a pre-tax net gain of $1.3 million on the early extinguishment of debt.
A. SCHULMAN, INC.
SUPPLEMENTAL SEGMENT INFORMATION
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Three months ended February 28, |
EMEA | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 29,235 |
| | $ | 35,913 |
| | $ | (6,678 | ) | | (18.6 | )% | | 10,770 |
| | 11,641 |
| | (871 | ) | | (7.5 | )% |
Masterbatch Solutions | | 99,779 |
| | 105,625 |
| | (5,846 | ) | | (5.5 | )% | | 93,068 |
| | 83,217 |
| | 9,851 |
| | 11.8 | % |
Engineered Plastics | | 89,695 |
| | 115,132 |
| | (25,437 | ) | | (22.1 | )% | | 63,491 |
| | 69,605 |
| | (6,114 | ) | | (8.8 | )% |
Specialty Powders | | 35,286 |
| | 43,368 |
| | (8,082 | ) | | (18.6 | )% | | 43,603 |
| | 42,469 |
| | 1,134 |
| | 2.7 | % |
Distribution Services | | 61,151 |
| | 82,986 |
| | (21,835 | ) | | (26.3 | )% | | 97,926 |
| | 99,284 |
| | (1,358 | ) | | (1.4 | )% |
Total EMEA | | $ | 315,146 |
| | $ | 383,024 |
| | $ | (67,878 | ) | | (17.7 | )% | | 308,858 |
| | 306,216 |
| | 2,642 |
| | 0.9 | % |
| | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Three months ended February 28, |
USCAN | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 10,093 |
| | $ | 8,417 |
| | $ | 1,676 |
| | 19.9 | % | | 3,395 |
| | 2,849 |
| | 546 |
| | 19.2 | % |
Masterbatch Solutions | | 39,101 |
| | 30,397 |
| | 8,704 |
| | 28.6 | % | | 50,533 |
| | 44,923 |
| | 5,610 |
| | 12.5 | % |
Engineered Plastics | | 44,894 |
| | 31,827 |
| | 13,067 |
| | 41.1 | % | | 27,972 |
| | 20,439 |
| | 7,533 |
| | 36.9 | % |
Specialty Powders | | 22,390 |
| | 21,041 |
| | 1,349 |
| | 6.4 | % | | 33,678 |
| | 34,619 |
| | (941 | ) | | (2.7 | )% |
Distribution Services | | 16,956 |
| | 17,010 |
| | (54 | ) | | (0.3 | )% | | 17,891 |
| | 17,734 |
| | 157 |
| | 0.9 | % |
Total USCAN | | $ | 133,434 |
| | $ | 108,692 |
| | $ | 24,742 |
| | 22.8 | % | | 133,469 |
| | 120,564 |
| | 12,905 |
| | 10.7 | % |
| | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Three months ended February 28, |
LATAM | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 1,236 |
| | $ | 864 |
| | $ | 372 |
| | 43.1 | % | | 504 |
| | 344 |
| | 160 |
| | 46.5 | % |
Masterbatch Solutions | | 20,247 |
| | 23,667 |
| | (3,420 | ) | | (14.5 | )% | | 14,544 |
| | 15,737 |
| | (1,193 | ) | | (7.6 | )% |
Engineered Plastics | | 10,775 |
| | 12,197 |
| | (1,422 | ) | | (11.7 | )% | | 7,892 |
| | 8,638 |
| | (746 | ) | | (8.6 | )% |
Specialty Powders | | 8,875 |
| | 11,679 |
| | (2,804 | ) | | (24.0 | )% | | 7,453 |
| | 10,951 |
| | (3,498 | ) | | (31.9 | )% |
Distribution Services | | — |
| | — |
| | — |
| | N/A |
| | — |
| | — |
| | — |
| | N/A |
|
Total LATAM | | $ | 41,133 |
| | $ | 48,407 |
| | $ | (7,274 | ) | | (15.0 | )% | | 30,393 |
| | 35,670 |
| | (5,277 | ) | | (14.8 | )% |
| | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Three months ended February 28, |
APAC | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 2,702 |
| | $ | 571 |
| | $ | 2,131 |
| | 373.2 | % | | 1,823 |
| | 429 |
| | 1,394 |
| | 324.9 | % |
Masterbatch Solutions | | 19,324 |
| | 19,883 |
| | (559 | ) | | (2.8 | )% | | 19,715 |
| | 17,930 |
| | 1,785 |
| | 10.0 | % |
Engineered Plastics | | 27,466 |
| | 23,884 |
| | 3,582 |
| | 15.0 | % | | 19,426 |
| | 16,013 |
| | 3,413 |
| | 21.3 | % |
Specialty Powders | | 2,682 |
| | 3,776 |
| | (1,094 | ) | | (29.0 | )% | | 2,776 |
| | 3,461 |
| | (685 | ) | | (19.8 | )% |
Distribution Services | | 408 |
| | 271 |
| | 137 |
| | 50.6 | % | | 517 |
| | 361 |
| | 156 |
| | 43.2 | % |
Total APAC | | $ | 52,582 |
| | $ | 48,385 |
| | $ | 4,197 |
| | 8.7 | % | | 44,257 |
| | 38,194 |
| | 6,063 |
| | 15.9 | % |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Six months ended February 28, |
EMEA | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 62,694 |
| | $ | 71,986 |
| | $ | (9,292 | ) | | (12.9 | )% | | 22,280 |
| | 23,972 |
| | (1,692 | ) | | (7.1 | )% |
Masterbatch Solutions | | 216,179 |
| | 214,527 |
| | 1,652 |
| | 0.8 | % | | 190,398 |
| | 168,557 |
| | 21,841 |
| | 13.0 | % |
Engineered Plastics | | 198,968 |
| | 237,348 |
| | (38,380 | ) | | (16.2 | )% | | 135,181 |
| | 144,762 |
| | (9,581 | ) | | (6.6 | )% |
Specialty Powders | | 76,735 |
| | 90,408 |
| | (13,673 | ) | | (15.1 | )% | | 87,045 |
| | 89,467 |
| | (2,422 | ) | | (2.7 | )% |
Distribution Services | | 131,761 |
| | 161,217 |
| | (29,456 | ) | | (18.3 | )% | | 190,412 |
| | 191,678 |
| | (1,266 | ) | | (0.7 | )% |
Total EMEA | | $ | 686,337 |
| | $ | 775,486 |
| | $ | (89,149 | ) | | (11.5 | )% | | 625,316 |
| | 618,436 |
| | 6,880 |
| | 1.1 | % |
| | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Six months ended February 28, |
USCAN | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 20,315 |
| | $ | 15,557 |
| | $ | 4,758 |
| | 30.6 | % | | 6,817 |
| | 5,028 |
| | 1,789 |
| | 35.6 | % |
Masterbatch Solutions | | 82,437 |
| | 61,095 |
| | 21,342 |
| | 34.9 | % | | 108,693 |
| | 92,564 |
| | 16,129 |
| | 17.4 | % |
Engineered Plastics | | 92,668 |
| | 56,599 |
| | 36,069 |
| | 63.7 | % | | 58,053 |
| | 37,401 |
| | 20,652 |
| | 55.2 | % |
Specialty Powders | | 48,659 |
| | 43,228 |
| | 5,431 |
| | 12.6 | % | | 77,820 |
| | 75,245 |
| | 2,575 |
| | 3.4 | % |
Distribution Services | | 34,062 |
| | 28,154 |
| | 5,908 |
| | 21.0 | % | | 35,050 |
| | 30,110 |
| | 4,940 |
| | 16.4 | % |
Total USCAN | | $ | 278,141 |
| | $ | 204,633 |
| | $ | 73,508 |
| | 35.9 | % | | 286,433 |
| | 240,348 |
| | 46,085 |
| | 19.2 | % |
| | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Six months ended February 28, |
LATAM | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 2,403 |
| | $ | 1,890 |
| | $ | 513 |
| | 27.1 | % | | 951 |
| | 769 |
| | 182 |
| | 23.7 | % |
Masterbatch Solutions | | 42,202 |
| | 46,445 |
| | (4,243 | ) | | (9.1 | )% | | 29,527 |
| | 30,624 |
| | (1,097 | ) | | (3.6 | )% |
Engineered Plastics | | 22,968 |
| | 24,509 |
| | (1,541 | ) | | (6.3 | )% | | 16,579 |
| | 17,281 |
| | (702 | ) | | (4.1 | )% |
Specialty Powders | | 19,741 |
| | 26,149 |
| | (6,408 | ) | | (24.5 | )% | | 16,280 |
| | 22,446 |
| | (6,166 | ) | | (27.5 | )% |
Distribution Services | | — |
| | — |
| | — |
| | N/A |
| | — |
| | — |
| | — |
| | N/A |
|
Total LATAM | | $ | 87,314 |
| | $ | 98,993 |
| | $ | (11,679 | ) | | (11.8 | )% | | 63,337 |
| | 71,120 |
| | (7,783 | ) | | (10.9 | )% |
| | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Six months ended February 28, |
APAC | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 5,932 |
| | $ | 1,273 |
| | $ | 4,659 |
| | 366.0 | % | | 4,194 |
| | 962 |
| | 3,232 |
| | 336.0 | % |
Masterbatch Solutions | | 39,663 |
| | 40,409 |
| | (746 | ) | | (1.8 | )% | | 38,568 |
| | 35,473 |
| | 3,095 |
| | 8.7 | % |
Engineered Plastics | | 52,742 |
| | 45,282 |
| | 7,460 |
| | 16.5 | % | | 36,331 |
| | 29,593 |
| | 6,738 |
| | 22.8 | % |
Specialty Powders | | 6,455 |
| | 7,026 |
| | (571 | ) | | (8.1 | )% | | 6,467 |
| | 6,423 |
| | 44 |
| | 0.7 | % |
Distribution Services | | 764 |
| | 803 |
| | (39 | ) | | (4.9 | )% | | 927 |
| | 1,005 |
| | (78 | ) | | (7.8 | )% |
Total APAC | | $ | 105,556 |
| | $ | 94,793 |
| | $ | 10,763 |
| | 11.4 | % | | 86,487 |
| | 73,456 |
| | 13,031 |
| | 17.7 | % |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Three months ended February 28, |
Consolidated | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 43,266 |
| | $ | 45,765 |
| | $ | (2,499 | ) | | (40.0 | )% | | 16,492 |
| | 15,263 |
| | 1,229 |
| | (31.3 | )% |
Masterbatch Solutions | | 178,451 |
| | 179,572 |
| | (1,121 | ) | | (34.0 | )% | | 177,860 |
| | 161,807 |
| | 16,053 |
| | (27.1 | )% |
Engineered Plastics | | 172,830 |
| | 183,040 |
| | (10,210 | ) | | (37.4 | )% | | 118,781 |
| | 114,695 |
| | 4,086 |
| | (32.9 | )% |
Specialty Powders | | 69,233 |
| | 79,864 |
| | (10,631 | ) | | (43.5 | )% | | 87,510 |
| | 91,500 |
| | (3,990 | ) | | (36.9 | )% |
Distribution Services | | 78,515 |
| | 100,267 |
| | (21,752 | ) | | (49.0 | )% | | 116,334 |
| | 117,379 |
| | (1,045 | ) | | (38.6 | )% |
Total Consolidated | | $ | 542,295 |
| | $ | 588,508 |
| | $ | (46,213 | ) | | (39.4 | )% | | 516,977 |
| | 500,644 |
| | 16,333 |
| | (33.0 | )% |
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Net Sales | | Pounds Sold |
| | Six months ended February 28, |
Consolidated | | 2015 | | 2014 | | $ Change | | % Change | | 2015 | | 2014 | | Lbs. Change | | % Change |
| | (In thousands, except for %'s) |
Custom Performance Color | | $ | 91,344 |
| | $ | 90,706 |
| | $ | 638 |
| | (16.7 | )% | | 34,242 |
| | 30,731 |
| | 3,511 |
| | (8.1 | )% |
Masterbatch Solutions | | 380,481 |
| | 362,476 |
| | 18,005 |
| | (11.6 | )% | | 367,186 |
| | 327,218 |
| | 39,968 |
| | (6.1 | )% |
Engineered Plastics | | 367,346 |
| | 363,738 |
| | 3,608 |
| | (15.0 | )% | | 246,144 |
| | 229,037 |
| | 17,107 |
| | (10.8 | )% |
Specialty Powders | | 151,590 |
| | 166,811 |
| | (15,221 | ) | | (23.6 | )% | | 187,612 |
| | 193,581 |
| | (5,969 | ) | | (18.4 | )% |
Distribution Services | | 166,587 |
| | 190,174 |
| | (23,587 | ) | | (26.8 | )% | | 226,389 |
| | 222,793 |
| | 3,596 |
| | (18.3 | )% |
Total Consolidated | | $ | 1,157,348 |
| | $ | 1,173,905 |
| | $ | (16,557 | ) | | (17.2 | )% | | 1,061,573 |
| | 1,003,360 |
| | 58,213 |
| | (12.3 | )% |
A. SCHULMAN, INC.
SUPPLEMENTAL SEGMENT INFORMATION
(continued)
|
| | | | | | | | | | | | | | | | |
| | Three months ended February 28, | | Six months ended February 28, |
| | 2015 | | 2014 | | 2015 | | 2014 |
| | Unaudited (In thousands, except for %'s) |
Segment gross profit | | | | | | | | |
EMEA | | $ | 44,507 |
| | $ | 47,499 |
| | $ | 94,213 |
| | $ | 99,439 |
|
USCAN | | 19,745 |
| | 13,370 |
| | 44,374 |
| | 27,120 |
|
LATAM | | 7,101 |
| | 7,856 |
| | 12,751 |
| | 15,539 |
|
APAC | | 7,382 |
| | 6,527 |
| | 14,632 |
| | 13,150 |
|
Total segment gross profit | | 78,735 |
| | 75,252 |
| | 165,970 |
| | 155,248 |
|
Inventory step-up | | — |
| | (782 | ) | | (341 | ) | | (1,199 | ) |
Accelerated depreciation, restructuring and related costs | | (596 | ) | | (137 | ) | | (596 | ) | | (608 | ) |
Costs related to acquisitions and integrations | | (65 | ) | | (34 | ) | | (115 | ) |
| (34 | ) |
Total gross profit | | $ | 78,074 |
| | $ | 74,299 |
| | $ | 164,918 |
| | $ | 153,407 |
|
| | | | | | | | |
Segment operating income | | | | | | | | |
EMEA | | $ | 16,277 |
| | $ | 17,553 |
| | $ | 36,316 |
| | $ | 37,972 |
|
USCAN | | 5,925 |
| | 2,839 |
| | 17,317 |
| | 6,699 |
|
LATAM | | 2,281 |
| | 3,430 |
| | 2,877 |
| | 6,933 |
|
APAC | | 3,423 |
| | 3,176 |
| | 6,931 |
| | 6,542 |
|
Total segment operating income | | 27,906 |
| | 26,998 |
| | 63,441 |
| | 58,146 |
|
Corporate | | (9,006 | ) | | (7,714 | ) | | (16,490 | ) | | (14,397 | ) |
Costs related to acquisitions and integrations | | (3,337 | ) | | (1,851 | ) | | (4,389 | ) | | (2,487 | ) |
Restructuring and related costs | | (3,779 | ) | | (2,792 | ) | | (9,359 | ) | | (6,164 | ) |
CEO transition costs | | (6,167 | ) | | — |
| | (6,167 | ) | | — |
|
Asset impairment | | — |
| | (104 | ) | | — |
| | (104 | ) |
Accelerated depreciation | | (298 | ) | | — |
| | (298 | ) | | (108 | ) |
Inventory step-up | | — |
| | (782 | ) | | (341 | ) | | (1,199 | ) |
Operating income | | 5,319 |
| | 13,755 |
| | 26,397 |
| | 33,687 |
|
Interest expense, net | | (2,245 | ) | | (2,407 | ) | | (4,509 | ) | | (4,536 | ) |
Foreign currency transaction gains (losses) | | (1,141 | ) | | (1,466 | ) | | (2,240 | ) | | (2,148 | ) |
Other income (expense), net | | 245 |
| | 193 |
| | 404 |
| | 271 |
|
Gain on early extinguishment of debt | | 1,290 |
| | — |
| | 1,290 |
| | — |
|
Income from continuing operations before taxes | | $ | 3,468 |
| | $ | 10,075 |
| | $ | 21,342 |
| | $ | 27,274 |
|
| | | | | | | | |
Capacity utilization | | | | | | | | |
EMEA | | 74 | % | | 77 | % | | 81 | % | | 82 | % |
USCAN | | 60 | % | | 56 | % | | 63 | % | | 60 | % |
LATAM | | 64 | % | | 74 | % | | 68 | % | | 80 | % |
APAC | | 62 | % | | 72 | % | | 64 | % | | 70 | % |
Worldwide | | 67 | % | | 69 | % | | 71 | % | | 73 | % |