Eastman Announces Record Sales and Earnings
All Segments Report Record Quarterly Earnings
KINGSPORT, Tenn., July 28, 2011 – Eastman Chemical Company (NYSE:EMN) today announced earnings from continuing operations of $2.90 per diluted share for second quarter 2011 versus $1.92 per diluted share for second quarter 2010. Excluding a $15 million gain in second quarter 2011 from the sale of previously impaired methanol assets in Beaumont, Texas, and $3 million of restructuring charges in second quarter 2010, earnings from continuing operations were $2.76 per diluted share in second quarter 2011 and $1.95 per diluted share in second quarter 2010. For reconciliation to reported company and segment earnings, see Tables 3 and 4 in the accompanying second-quarter 2011 financial tables.
“For the second consecutive quarter, we reported record earnings, and we are on track to report record annual earnings for this year,” said Jim Rogers, Chairman and CEO. “This performance demonstrates the strength of our portfolio of businesses, including innovative new products and the benefits of geographic and end-market diversity. I remain confident that the combination of growth in our core businesses and our disciplined capital allocation will continue this track record of annual earnings growth over the next several years.”
(In millions, except per share amounts) | 2Q2011 | 2Q2010 | ||
| Sales revenue | $ | 1,885 | $ | 1,502 |
| Earnings per diluted share from continuing operations | $ | 2.90 | $ | 1.92 |
Earnings per diluted share from continuing operations excluding asset impairments and restructuring charges (gains), net* | $ | 2.76 | $ | 1.95 |
| Net cash provided by operating activities | $ | 207 | $ | 206 |
*For reconciliation to reported company and segment earnings, see Tables 3 and 4 in the accompanying second-quarter 2011 financial tables.
Sales revenue for second quarter 2011 was $1.9 billion, a 26 percent increase compared with second quarter 2010 due to higher selling prices and higher sales volume. The higher selling prices were in response to higher raw material and energy costs and were also attributed to strengthened demand, particularly in the U.S., and tight industry supply. The higher sales volume was primarily due to growth in plasticizer product lines, increased demand for acetyl chemicals, the fourth quarter 2010 restart of a previously idled olefins cracking unit at the Texas facility, and strengthened end-market demand primarily in the packaging, transportation, and durable goods markets.
Operating earnings in second quarter 2011 increased to $303 million compared with operating earnings of $249 million in second quarter 2010, excluding asset impairments and restructuring charges and gains in both periods. Operating earnings increased due to higher selling prices and higher sales volume, which more than offset higher raw material and energy costs.
Segment Results 2Q 2011 versus 2Q 2010
Coatings, Adhesives, Specialty Polymers and Inks – Sales revenue increased by 18 percent due to higher selling prices and higher sales volume. The higher selling prices were in response to higher raw material and energy costs and were also attributed to strengthened demand, particularly in the U.S., and tight industry supply. The higher sales volume was attributed primarily to strengthened end-use demand in the packaging, transportation, and durable goods markets, particularly in the U.S. Operating earnings in second quarter 2011 increased to $99 million compared with operating earnings of $92 million in second quarter 2010. The increase was due to higher selling prices, higher sales volume, and the increased benefits from cracking propane to produce propylene at low cost, which more than offset higher raw material and energy costs.
Fibers – Sales revenue increased by 21 percent due to a favorable shift in product mix, higher sales volume, and higher selling prices. The favorable shift in product mix was mainly due to higher acetate tow sales volume resulting from increased utilization of the recently completed acetate tow manufacturing facility in Korea. The higher selling prices were in response to higher raw material and energy costs, particularly for wood pulp. Operating earnings in second quarter 2011 increased to $93 million compared with $81 million in second quarter 2010 due to higher acetate tow sales volume in Asia Pacific and higher selling prices, partially offset by higher raw material and energy costs.
Performance Chemicals and Intermediates – Sales revenue increased by 35 percent due to higher selling prices and higher sales volume. The higher selling prices were in response to higher raw material and energy costs and were also attributed to strengthened demand in the U.S. and tight industry supply. The higher sales volume was due to growth in plasticizer product lines and was also attributed to customer buying patterns for acetyl chemicals. In addition, sales volume increased due to the fourth quarter 2010 restart of a previously idled olefins cracking unit at the Texas facility. Operating earnings in second quarter 2011 increased to $88 million compared to $71 million in second quarter 2010 excluding restructuring charges. The increase was due primarily to higher selling prices, higher sales volume, and the increased benefits from cracking propane to produce propylene at low cost, which more than offset higher raw material and energy costs.
Specialty Plastics – Sales revenue increased by 23 percent due primarily to higher selling prices, which more than offset higher raw material and energy costs, particularly for paraxylene. Operating earnings in second quarter 2011 increased to $37 million compared with operating earnings of $21 million in second quarter 2010. Operating earnings increased in the Asia Pacific region due to higher selling prices and in the Europe, Middle East and Africa region due to both higher sales volume and higher selling prices.
Cash Flow
Eastman generated $207 million in cash from operating activities during second quarter 2011, primarily due to strong net earnings. Second-quarter 2011 cash flows included $55 million of a total anticipated $110 million tax payment for the gain on the sale of the PET business completed in first quarter 2011. During second quarter 2011, share repurchases totaled $103 million.
Outlook
Commenting on the outlook for third quarter and full year 2011, Rogers said: "Our strong portfolio of businesses delivered significant earnings growth in the first half of 2011, and we expect they will continue to deliver earnings growth in the second half of the year. We also expect normal seasonal declines in our sales volume, and continued volatility in raw material and energy costs. In addition, we will have costs related to planned and unplanned shutdowns that are expected to be approximately $25 million higher in the second half of 2011 compared with the first half. Even with these higher costs, we expect third quarter 2011 earnings per share to be slightly higher than third quarter 2010 earnings per share of $2.22. In addition, we expect full-year 2011 earnings per share to be slightly higher than $9.25." Costs and charges related to acquisitions that could be completed in the second half of the year are excluded from earnings projections.
Eastman will host a conference call with industry analysts on July 29 at 8:00 a.m. EDT. To listen to the live webcast of the conference call and view the accompanying slides, go to www.investors.eastman.com, Events & Presentations. To listen via telephone, the dial-in number is 913-312-1498, passcode number 3084013. A web replay, a replay in downloadable MP3 format, and the accompanying slides will be available at www.investors.eastman.com, Events & Presentations. A telephone replay will be available continuously from 11:00 a.m. EDT, July 29, to 11:00 a.m. EDT, August 8, at (888) 203-1112 or (719) 457-0820, passcode 3084013.
Forward-Looking Statements: This news release includes forward-looking statements concerning current expectations for sales volumes, raw material and energy costs, capacity shutdown costs, and earnings for third quarter, second half, and full-year 2011, and for annual earnings for the next several years. Such expectations are based upon certain preliminary information, internal estimates, and management assumptions, expectations, and plans, and are subject to a number of risks and uncertainties inherent in projecting future conditions, events, and results. Actual results could differ materially from expectations expressed in the forward-looking statements if one or more of the underlying assumptions or expectations prove to be inaccurate or are unrealized. Important factors that could cause actual results to differ materially from such expectations are and will be detailed in the company's filings with the Securities and Exchange Commission, including the Form 10-Q filed for first quarter 2011 available, and the Form 10-Q to be filed for second quarter 2011 and to be available, on the Eastman web site at www.eastman.com in the Investors, SEC information section.
Eastman’s chemicals, fibers and plastics are used as key ingredients in products that people use every day. Approximately 10,000 Eastman employees around the world blend technical expertise and innovation to deliver practical solutions. The company is committed to finding sustainable business opportunities within the diverse markets it serves. A global company headquartered in Kingsport, Tenn., USA, Eastman had 2010 sales of $6 billion. For more information, visit www.eastman.com.
# # #
Contacts: |
Media: Tracy Broadwater |
423-224-0498 / tkbroadwater@eastman.com |
Investors: Greg Riddle |
212-835-1620 / griddle@eastman.com |
| EASTMAN CHEMICAL COMPANY – EMN | July 28, 2011 |
| 5:00 PM EDT | |
FINANCIAL INFORMATION
July 28, 2011
| For use in the Eastman Chemical Company Conference Call |
| at 8:00 AM (EDT), July 29, 2011. |
Table of Contents
| Item | Page | |
| Statements of Earnings | 1 | |
| Segment Sales Information | 2 | |
| Sales Revenue Change | 2 | |
| Sales by Region | 3 | |
| Sales Revenue Change by Region | 3 | |
| Operating Earnings and Asset Impairments and Restructuring Charges (Gains), Net by Segment; Segment Operating Earnings Reconciliations | 4 | |
| Operating Earnings, Earnings, and Earnings Per Share from Continuing Operations Reconciliation | 5 | |
| Statements of Cash Flows | 6 | |
| Total Cash and Cash Equivalents and Short-Term Time Deposits | 6 | |
| Net Cash Provided By (Used In) Operating Activities Reconciliation and Free Cash Flow | 7 | |
| Selected Balance Sheet Items | 7 |
The Company completed the sale of the polyethylene terephthalate ("PET") business, related assets at the Columbia, South Carolina, site, and technology of its Performance Polymers segment on January 31, 2011. The PET business, assets, and technology sold were substantially all of the Performance Polymers segment. Performance Polymers segment operating results are presented as discontinued operations for all periods presented and are therefore not included in results from continuing operations under accounting principles generally accepted in the United States.
| EASTMAN CHEMICAL COMPANY – EMN | July 28, 2011 |
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| Page 1 |
| TABLE 1 - STATEMENTS OF EARNINGS |
| Second Quarter | First Six Months | |||||||
| (Dollars in millions, except per share amounts; unaudited) | 2011 | 2010 | 2011 | 2010 | ||||
| Sales | $ | 1,885 | $ | 1,502 | $ | 3,643 | $ | 2,872 |
| Cost of sales | 1,422 | 1,118 | 2,747 | 2,171 | ||||
| Gross profit | 463 | 384 | 896 | 701 | ||||
| Selling, general and administrative expenses | 121 | 102 | 234 | 197 | ||||
| Research and development expenses | 39 | 33 | 75 | 66 | ||||
| Asset impairments and restructuring charges (gains), net | (15) | 3 | (15) | 3 | ||||
| Operating earnings | 318 | 246 | 602 | 435 | ||||
| Net interest expense | 18 | 25 | 37 | 50 | ||||
| Other charges (income), net | (6) | 7 | (12) | 14 | ||||
| Earnings from continuing operations before income taxes | 306 | 214 | 577 | 371 | ||||
| Provision for income taxes from continuing operations | 96 | 73 | 185 | 125 | ||||
| Earnings from continuing operations | $ | 210 | $ | 141 | $ | 392 | $ | 246 |
| Earnings from discontinued operations, net of tax | -- | 7 | 8 | 3 | ||||
| Gain from disposal of discontinued operations, net of tax | 1 | -- | 31 | -- | ||||
| Net earnings | $ | 211 | $ | 148 | $ | 431 | $ | 249 |
| Basic earnings per share | ||||||||
| Earnings from continuing operations | $ | 2.97 | $ | 1.96 | $ | 5.55 | $ | 3.40 |
| Earnings from discontinued operations | 0.01 | 0.09 | 0.54 | 0.04 | ||||
| Basic earnings per share | $ | 2.98 | $ | 2.05 | $ | 6.09 | $ | 3.44 |
| Diluted earnings per share | ||||||||
| Earnings from continuing operations | $ | 2.90 | $ | 1.92 | $ | 5.40 | $ | 3.35 |
| Earnings from discontinued operations | 0.01 | 0.10 | 0.54 | 0.03 | ||||
| Diluted earnings per share | $ | 2.91 | $ | 2.02 | $ | 5.94 | $ | 3.38 |
| Shares (in millions) outstanding at end of period | 70.2 | 72.2 | 70.2 | 72.2 | ||||
| Shares (in millions) used for earnings per share calculation | ||||||||
| Basic | 70.7 | 72.3 | 70.7 | 72.3 | ||||
| Diluted | 72.5 | 73.5 | 72.5 | 73.5 | ||||
| EASTMAN CHEMICAL COMPANY – EMN | July 28, 2011 |
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| Page 2 |
| Second Quarter | First Six Months | |||||||
| (Dollars in millions, unaudited) | 2011 | 2010 | 2011 | 2010 | ||||
| Sales by Segment | ||||||||
| Coatings, Adhesives, Specialty Polymers, and Inks | $ | 491 | $ | 416 | $ | 958 | $ | 789 |
| Fibers | 331 | 274 | 621 | 541 | ||||
| Performance Chemicals and Intermediates | 729 | 541 | 1,423 | 1,023 | ||||
| Specialty Plastics | 334 | 271 | 641 | 519 | ||||
| Total Eastman Chemical Company | $ | 1,885 | $ | 1,502 | $ | 3,643 | $ | 2,872 |
TABLE 2B – SALES REVENUE CHANGE |
| Second Quarter 2011 Compared to Second Quarter 2010 | |||||||||
| Change in Sales Revenue Due To | |||||||||
| (Unaudited) | Revenue % Change | Volume Effect | Price Effect | Product Mix Effect | Exchange Rate Effect | ||||
Coatings, Adhesives, Specialty Polymers, and Inks | 18 % | 6 % | 12 % | (2) % | 2 % | ||||
| Fibers | 21 % | 5 % | 5 % | 11 % | -- % | ||||
| Performance Chemicals and Intermediates | 35 % | 15 % | 19 % | -- % | 1 % | ||||
| Specialty Plastics | 23 % | 3 % | 18 % | 1 % | 1 % | ||||
| Total Eastman Chemical Company | 26 % | 9 % | 14 % | 2 % | 1 % | ||||
| First Six Months 2011 Compared to First Six Months 2010 | |||||||||
| Change in Sales Revenue Due To | |||||||||
| (Unaudited) | Revenue % Change | Volume Effect | Price Effect | Product Mix Effect | Exchange Rate Effect | ||||
Coatings, Adhesives, Specialty Polymers, and Inks | 21 % | 8 % | 14 % | (1) % | -- % | ||||
| Fibers | 15 % | 5 % | 4 % | 6 % | -- % | ||||
| Performance Chemicals and Intermediates | 39 % | 23 % | 18 % | (2) % | -- % | ||||
| Specialty Plastics | 23 % | 5 % | 16 % | 2 % | -- % | ||||
| Total Eastman Chemical Company | 27 % | 13 % | 14 % | -- % | -- % | ||||
| EASTMAN CHEMICAL COMPANY – EMN | July 28, 2011 |
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| Page 3 |
TABLE 2C – SALES BY REGION |
| Second Quarter | First Six Months | |||||||
| (Dollars in millions, unaudited) | 2011 | 2010 | 2011 | 2010 | ||||
| Sales by Region | ||||||||
| United States and Canada | $ | 1,004 | $ | 791 | $ | 1,922 | $ | 1,482 |
| Asia Pacific | 434 | 355 | 831 | 689 | ||||
| Europe, Middle East, and Africa | 370 | 284 | 725 | 560 | ||||
| Latin America | 77 | 72 | 165 | 141 | ||||
| Total Eastman Chemical Company | $ | 1,885 | $ | 1,502 | $ | 3,643 | $ | 2,872 |
TABLE 2D – SALES REVENUE CHANGE BY REGION |
| Second Quarter 2011 Compared to Second Quarter 2010 | |||||||||
| Change in Sales Revenue Due To | |||||||||
| (Unaudited) | Change | Volume Effect | Price Effect | Product Mix Effect | Exchange Rate Effect | ||||
| United States and Canada | 27 % | 10 % | 16 % | 1 % | -- % | ||||
| Asia Pacific | 23 % | 5 % | 12 % | 5 % | 1 % | ||||
| Europe, Middle East, and Africa | 30 % | 13 % | 13 % | -- % | 4 % | ||||
| Latin America | 6 % | (6) % | 10 % | 1 % | 1 % | ||||
| Total Eastman Chemical Company | 26 % | 9 % | 14 % | 2 % | 1 % | ||||
| First Six Months 2011 Compared to First Six Months 2010 | |||||||||
| Change in Sales Revenue Due To | |||||||||
| (Unaudited) | Change | Volume Effect | Price Effect | Product Mix Effect | Exchange Rate Effect | ||||
| United States and Canada | 30 % | 15 % | 15 % | -- % | -- % | ||||
| Asia Pacific | 21 % | 6 % | 11 % | 3 % | 1 % | ||||
| Europe, Middle East, and Africa | 29 % | 16 % | 13 % | -- % | -- % | ||||
| Latin America | 16 % | 5 % | 13 % | (2) % | -- % | ||||
| Total Eastman Chemical Company | 27 % | 13 % | 14 % | -- % | -- % | ||||
| EASTMAN CHEMICAL COMPANY – EMN | July 28, 2011 |
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| Page 4 |
| TABLE 3 - OPERATING EARNINGS AND ASSET IMPAIRMENTS AND RESTRUCTURING CHARGES (GAINS), NET BY SEGMENT; SEGMENT OPERATING EARNINGS RECONCILIATIONS |
| Second Quarter | First Six Months | |||||||
| (Dollars in millions, unaudited) | 2011 | 2010 | 2011 | 2010 | ||||
| Operating Earnings by Segment and Item | ||||||||
| Coatings, Adhesives, Specialty Polymers, and Inks | ||||||||
| Operating earnings | $ | 99 | $ | 92 | $ | 197 | $ | 157 |
| Fibers | ||||||||
| Operating earnings | 93 | 81 | 174 | 159 | ||||
| Performance Chemicals and Intermediates | ||||||||
| Operating earnings | 88 | 68 | 176 | 103 | ||||
Asset impairments and restructuring charges, net (1) | -- | 3 | -- | 3 | ||||
| Operating earnings excluding item | 88 | 71 | 176 | 106 | ||||
| Specialty Plastics | ||||||||
| Operating earnings | 37 | 21 | 67 | 40 | ||||
| Total Operating Earnings by Segment and Item | ||||||||
| Total operating earnings | 317 | 262 | 614 | 459 | ||||
| Total asset impairments and restructuring charges, net | -- | 3 | -- | 3 | ||||
| Total operating earnings excluding item | 317 | 265 | 614 | 462 | ||||
Other (2) | ||||||||
| Operating earnings (loss) | 1 | (16) | (12) | (24) | ||||
Asset impairments and restructuring charges (gains), net (3) | (15) | -- | (15) | -- | ||||
| Operating loss excluding item | (14) | (16) | (27) | (24) | ||||
| Total Eastman Chemical Company | ||||||||
| Total operating earnings | $ | 318 | $ | 246 | $ | 602 | $ | 435 |
| Total asset impairments and restructuring charges (gains), net | (15) | 3 | (15) | 3 | ||||
| Total operating earnings excluding item | $ | 303 | $ | 249 | $ | 587 | $ | 438 |
| (1) | Second quarter and first six months 2010 includes restructuring charges of $3 million, primarily for severance associated with the acquisition and integration of Genovique Specialty Corporation. |
(2) | Research and development and other expenses and asset impairments and restructuring charges (gains), net, not identifiable to an operating segment are not included in segment operating results for either of the periods presented and are shown as "other" operating earnings (loss). |
(3) | Second quarter and first six months 2011 includes $15 million gain from the sale of the previously impaired methanol and ammonia assets related to the terminated Beaumont, Texas industrial gasification project. |
| EASTMAN CHEMICAL COMPANY – EMN | July 28, 2011 |
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| TABLE 4 – OPERATING EARNINGS, EARNINGS, AND EARNINGS PER SHARE FROM CONTINUING OPERATIONS RECONCILIATION |
EARNINGS PER DILUTED SHARE FROM CONTINUING OPERATIONS EXCLUDING CERTAIN ITEM
| Second Quarter 2011 | ||||||||||||||||
| Earnings from Continuing Operations | ||||||||||||||||
| (Dollars in millions, unaudited) | Operating Earnings | Before Tax | After Tax | Per Diluted Share | ||||||||||||
| As reported | $ | 318 | $ | 306 | $ | 210 | $ | 2.90 | ||||||||
| Certain Item: | ||||||||||||||||
| Asset impairments and restructuring charges (gains), net | (15 | ) | (15 | ) | (10 | ) | (0.14 | ) | ||||||||
| Excluding item | $ | 303 | $ | 291 | $ | 200 | $ | 2.76 | ||||||||
| Second Quarter 2010 | ||||||||||||||||
| Earnings from Continuing Operations | ||||||||||||||||
| (Dollars in millions, unaudited) | Operating Earnings | Before Tax | After Tax | Per Diluted Share | ||||||||||||
| As reported | $ | 246 | $ | 214 | $ | 141 | $ | 1.92 | ||||||||
| Certain Item: | ||||||||||||||||
| Asset impairments and restructuring charges, net | 3 | 3 | 2 | 0.03 | ||||||||||||
| Excluding item | $ | 249 | $ | 217 | $ | 143 | $ | 1.95 | ||||||||
| First Six Months 2011 | ||||||||||||||||
| Earnings from Continuing Operations | ||||||||||||||||
| (Dollars in millions, unaudited) | Operating Earnings | Before Tax | After Tax | Per Diluted Share | ||||||||||||
| As reported | $ | 602 | $ | 577 | $ | 392 | $ | 5.40 | ||||||||
| Certain Item: | ||||||||||||||||
| Asset impairments and restructuring charges (gains), net | (15 | ) | (15 | ) | (10 | ) | (0.13 | ) | ||||||||
| Excluding item | $ | 587 | $ | 562 | $ | 382 | $ | 5.27 | ||||||||
| First Six Months 2010 | ||||||||||||||||
| Earnings from Continuing Operations | ||||||||||||||||
| (Dollars in millions, unaudited) | Operating Earnings | Before Tax | After Tax | Per Diluted Share | ||||||||||||
| As reported | $ | 435 | $ | 371 | $ | 246 | $ | 3.35 | ||||||||
| Certain Item: | ||||||||||||||||
| Asset impairments and restructuring charges, net | 3 | 3 | 2 | 0.03 | ||||||||||||
| Excluding item | $ | 438 | $ | 374 | $ | 248 | $ | 3.38 | ||||||||
| EASTMAN CHEMICAL COMPANY – EMN | July 28, 2011 |
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| TABLE 5 – STATEMENTS OF CASH FLOWS |
| Second Quarter | First Six Months | |||||||
| (Dollars in millions, unaudited) | 2011 | 2010 | 2011 | 2010 | ||||
| Cash flows from operating activities | ||||||||
| Net earnings | $ | 211 | $ | 148 | $ | 431 | $ | 249 |
| Adjustments to reconcile net earnings to net cash provided by (used in) operating activities: | ||||||||
| Depreciation and amortization | 67 | 70 | 135 | 139 | ||||
| Gain on sale of assets | (18) | -- | (70) | -- | ||||
| Provision (benefit) for deferred income taxes | 20 | (4) | (32) | 12 | ||||
| Changes in operating assets and liabilities, net of effect of acquisitions and divestitures: | ||||||||
| (Increase) decrease in trade receivables | 17 | (19) | (212) | (433) | ||||
| (Increase) decrease in inventories | (72) | (32) | (121) | (90) | ||||
| Increase (decrease) in trade payables | 62 | (4) | 70 | 90 | ||||
| Increase (decrease) in liabilities for employee benefits and incentive pay | 45 | 35 | (139) | (10) | ||||
| Other items, net | (125) | 12 | (1) | 24 | ||||
| Net cash provided by (used in) operating activities | 207 | 206 | 61 | (19) | ||||
| Cash flows from investing activities | ||||||||
| Additions to properties and equipment | (109) | (45) | (206) | (76) | ||||
| Proceeds from sale of assets and investments | 27 | 7 | 644 | 11 | ||||
| Acquisitions of and investments in joint ventures | -- | (171) | -- | (189) | ||||
| Additions to short-term time deposits | -- | -- | (200) | -- | ||||
| Additions to capitalized software | (3) | (1) | (5) | (3) | ||||
| Other items, net | 5 | -- | (6) | -- | ||||
| Net cash provided by (used in) investing activities | (80) | (210) | 227 | (257) | ||||
| Cash flows from financing activities | ||||||||
| Net increase in commercial paper, credit facility and other borrowings | -- | (1) | 1 | 1 | ||||
| Repayment of borrowings | (2) | -- | (2) | -- | ||||
| Dividends paid to stockholders | (33) | (32) | (67) | (64) | ||||
| Treasury stock purchases | (103) | (33) | (177) | (53) | ||||
| Proceeds from stock option exercises and other items | 5 | 21 | 75 | 33 | ||||
| Net cash (used in) financing activities | (133) | (45) | (170) | (83) | ||||
| Effect of exchange rate changes on cash and cash equivalents | -- | 1 | -- | 1 | ||||
| Net change in cash and cash equivalents | (6) | (48) | 118 | (358) | ||||
| Cash and cash equivalents at beginning of period | 640 | 483 | 516 | 793 | ||||
| Cash and cash equivalents at end of period | $ | 634 | $ | 435 | $ | 634 | $ | 435 |
TABLE 5A – TOTAL CASH AND CASH EQUIVALENTS AND SHORT-TERM TIME DEPOSITS |
| First Six Months | ||||
| (Dollars in millions, unaudited) | 2011 | 2010 | ||
| Cash and cash equivalents at end of period | $ | 634 | $ | 435 |
| Short-term time deposits | 200 | -- | ||
| Total cash and cash equivalents and short-term time deposits | $ | 834 | $ | 435 |
| EASTMAN CHEMICAL COMPANY – EMN | July 28, 2011 |
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| Page 7 |
| TABLE 5B – NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES RECONCILIATION AND FREE CASH FLOW |
| Second Quarter | First Six Months | |||||||
| (Dollars in millions, unaudited) | 2011 | 2010 | 2011 | 2010 | ||||
| Net cash provided by (used in) operating activities | $ | 207 | $ | 206 | $ | 61 | $ | (19) |
Impact of adoption of amended accounting guidance (1) | -- | -- | -- | 200 | ||||
Impact of tax payment on the sale of the PET business (2) | 55 | -- | 55 | -- | ||||
| Net cash provided by operating activities excluding items | 262 | 206 | 116 | 181 | ||||
| Additions to properties and equipment | (109) | (45) | (206) | (76) | ||||
| Dividends paid to stockholders | (33) | (32) | (67) | (64) | ||||
| Free Cash Flow | $ | 120 | $ | 129 | $ | (157) | $ | 41 |
(1) | First six months 2010 cash from operating activities reflected the adoption of amended accounting guidance for transfers of financial assets which resulted in $200 million of receivables, which were previously accounted for as sold and removed from the balance sheet when transferred under the accounts receivable securitization program, being included on the first quarter balance sheet as trade receivables, net. This increase in receivables reduced cash from operations by $200 million in first quarter 2010. |
(2) | Second quarter 2011 cash flows included $55 million of a total anticipated $110 million tax payment for the tax gain on the sale of the PET business completed in first quarter 2011. |
| June 30, | December 31, | |||
| (Dollars in millions) | 2011 | 2010 | ||
| (unaudited) | ||||
| Current Assets | $ | 2,508 | $ | 2,047 |
| Net Properties and Equipment | 2,919 | 3,219 | ||
| Other Assets | 687 | 720 | ||
| Total Assets | $ | 6,114 | $ | 5,986 |
| Payables and Other Current Liabilities | $ | 1,037 | $ | 1,064 |
| Short-term Borrowings | 155 | 6 | ||
| Long-term Borrowings | 1,446 | 1,598 | ||
| Other Liabilities | 1,569 | 1,691 | ||
| Stockholders’ Equity | 1,907 | 1,627 | ||
| Total Liabilities and Stockholders’ Equity | $ | 6,114 | $ | 5,986 |