[COMPANY LOGO]
VALHI REPORTS THIRD QUARTER RESULTS
DALLAS, TEXAS . . . October 25, 1996. . . Valhi, Inc. (NYSE: VHI) reported
a loss from continuing operations of $6.9 million, or $.06 per share, for the
third quarter of 1996 compared to income of $12.2 million, or $.11 per share, in
the third quarter of 1995. For the first nine months of 1996, income from
continuing operations was $8.9 million, or $.08 per share, compared to $32.8
million, or $.29 per share, in 1995.
Chemicals earnings at 55%-owned NL Industries declined in 1996 from the
year-ago periods due to lower selling prices of titanium dioxide pigments
(`TiO2''). Average TiO2 selling prices for the third quarter of 1996 were 15%
lower than the third quarter of 1995 and 6% lower than the second quarter of
this year. Selling prices at the end of the third quarter of 1996 were 15%
lower than at the end of 1995. While TiO2 prices have declined, demand for TiO2
has continued to grow as third quarter 1996 TiO2 sales volume increased 17%
compared with the third quarter of 1995. NL expects average TiO2 prices in the
fourth quarter to be somewhat below the third quarter average and, as a result,
the Company currently expects to report a fourth quarter loss from continuing
operations. Based on the continuing decline in TiO2 selling prices during the
third quarter and the current TiO2 industry pricing outlook, NL's Board of
Directors has suspended its regular quarterly dividend.
Average sugar selling prices for the third quarter of 1996 were 6% higher
than the third quarter of 1995 with year-to-date 1996 prices up 4%. Sales
volumes were down 22% in the third quarter and down 11% year-to-date due to a
smaller crop. Refined sugar earnings comparisons were adversely impacted in
1996 by relative LIFO inventory changes, with LIFO adjustments reducing
operating income for the third quarter by approximately $5.8 million ($12.9
million year-to-date) compared to last year. In other operations, both
component products and fast food reported higher operating income.
Discontinued operations represents the results of Medite Corporation's
building products operations. As previously-reported, the Company expects to
complete the sale of substantially all of Medite's assets in the fourth quarter
of 1996 at a estimated pre-tax gain of approximately $100 million.
The statements in this release relating to matters that are not historical
facts are forward looking statements that involve risks and uncertainties,
including, but not limited to, future supply and demand for the Company's
products (including cyclicality thereof), general economic conditions, changes
in government regulations, competitive products, customer and competitor
strategies, the impact of pricing and production decisions, environmental
matters, the ultimate resolution of pending litigation and any possible future
litigation, completion of pending asset/business unit dispositions and other
risks and uncertainties detailed in the Company's SEC filings.
Valhi, Inc. is a major producer of TiO2, refined sugar and other products.
* * * * *
VALHI, INC. AND SUBSIDIARIES
SUMMARY OF OPERATIONS
(Unaudited)
(In millions, except earnings per share)
THREE MONTHS NINE MONTHS
ENDED ENDED
SEPTEMBER 30, SEPTEMBER 30,
1995* 1996 1995* 1996
NET SALES
Chemicals $255.4 $248.5 $ 789.7 $ 752.1
Refined sugar 144.0 117.1 387.8 352.7
Other 48.9 50.8 143.9 150.6
------ ------ -------- --------
$448.3 $416.4 $1,321.4 $1,255.4
====== ====== ======== ========
OPERATING INCOME
Chemicals $ 45.2 $ 14.1 $ 134.2 $ 81.5
Refined sugar 6.0 1.8 18.7 14.4
Other 6.5 7.4 20.0 20.8
------ ------ ------ --------
TOTAL OPERATING INCOME 57.7 23.3 172.9 116.7
Equity in Waste Control - (1.6) - (4.0)
Specialists
General corporate items, net (5.8) (3.0) (16.1) (7.2)
Interest expense (28.7) (26.4) (89.8) (81.5)
------ ------ ------ ------
Income (loss) before 23.2 (7.7) 67.0 24.0
taxes
Income taxes (benefit) 11.2 (3.1) 33.9 8.2
Minority interest (.2) 2.3 .3 6.9
------ ------ ------- --------
INCOME (LOSS) FROM
CONTINUING 12.2 (6.9) 32.8 8.9
OPERATIONS
Discontinued operations 1.5 2.0 10.7 (10.7)
------ ------ -------- ------
NET INCOME (LOSS) $ 13.7 $ (4.9) $ 43.5 $ (1.8)
====== ====== ======== ========
INCOME (LOSS) PER COMMON
SHARE
Continuing operations $.11 $(.06) $.29 $ .08
Discontinued operations .01 .02 .09 (.09)
---- ----- ---- -----
NET INCOME (LOSS) $.12 $(.04) $.38 $(.01)
==== ===== ==== =====
Weighted average common
shares outstanding
114.4 114.6 114.4 114.6
===== ===== ===== =====
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* RECLASSIFIED FOR DISCONTINUED OPERATIONS.