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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 22, 2003
INTERNATIONAL SPECIALTY HOLDINGS INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 333-82822 22-3807354
(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification Number)
300 DELAWARE AVENUE, SUITE 303
WILMINGTON, DELAWARE 19801
(Address of Principal Executive Office)
Registrant's telephone number, including area code: (302) 427-5715
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ITEM 5. OTHER EVENTS;
ITEM 12. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
Effective January 1, 2003, we changed the composition of our reportable
segments to be consistent with the current structure of our businesses. Over the
last several years, we have increased our focus on our higher margin
consumer-oriented businesses. Consistent with that business focus, we will now
report three business segments: Specialty Chemicals, Industrial Chemicals and
Mineral Products. Our Specialty Chemicals segment will consist of the personal
care, pharmaceutical, food, beverage, performance chemicals and fine chemicals
product lines. Presented below are revised business segment sales and operating
income data for the years 2000, 2001 and 2002 and for the four quarterly periods
in the years 2001 and 2002.
INTERNATIONAL SPECIALTY HOLDINGS INC.
Year Ended December 31,
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2000 2001 2002
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(Millions)
(Unaudited)
Revised Annual Business Segment Information:
Net sales:
Specialty Chemicals..................... $ 545.0 $ 552.8 $ 600.8
Industrial Chemicals.................... 167.0 153.7 149.4
Mineral Products........................ 71.9 80.7 95.1
------- ------- -------
Net sales................................... $ 783.9 $ 787.2 $ 845.3
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Operating income (1):
Specialty Chemicals (2)................. $ 92.0 $ 89.8 $ 107.9
Industrial Chemicals (2)................ (6.4) 11.2 5.9
Mineral Products........................ 9.4 10.7 20.9
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Total segment operating income.......... 95.0 111.7 134.7
Unallocated corporate office items...... 1.7 1.0 0.5
(Provision) benefit for restructuring(3) (14.4) 0.5 -
Write-off of deferred costs (4)......... - - (7.6)
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Operating income............................ $ 82.3 $ 113.2 $ 127.6
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INTERNATIONAL SPECIALTY HOLDINGS INC.
Year 2001 by Quarter
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First Second Third Fourth
------- ------- ------- -------
(Millions)
(Unaudited)
Revised Quarterly Business
Segment Information:
Net sales:
Specialty Chemicals.............. $ 144.6 $ 141.0 $ 131.1 $ 136.1
Industrial Chemicals............. 40.2 40.7 33.7 39.1
Mineral Products................. 18.4 21.6 23.8 16.9
------- ------- ------- -------
Net sales............................ $ 203.2 $ 203.3 $ 188.6 $ 192.1
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Operating income:
Specialty Chemicals.............. $ 26.2 $ 28.2 $ 19.2 $ 16.2
Industrial Chemicals (5)......... (1.3) 4.6 6.3 1.6
Mineral Products................. 0.6 2.8 5.1 2.2
------- ------- ------- -------
Total segment operating income... 25.5 35.6 30.6 20.0
Unallocated corporate office
items........................ 0.6 0.1 0.1 0.2
(Provision) benefit for
restructuring (3)............ - - - 0.5
------- ------- ------- -------
Operating income..................... $ 26.1 $ 35.7 $ 30.7 $ 20.7
======= ======= ======= =======
Year 2002 by Quarter
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First Second Third Fourth
-------- ------- ------- --------
(Millions)
(Unaudited)
Revised Quarterly Business
Segment Information:
Net sales:
Specialty Chemicals.............. $ 159.6 $ 146.7 $ 149.3 $ 145.2
Industrial Chemicals............. 35.5 42.3 34.5 37.1
Mineral Products................. 24.0 25.7 24.6 20.8
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Net sales............................ $ 219.1 $ 214.7 $ 208.4 $ 203.1
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Operating income:
Specialty Chemicals (6).......... $ 25.4 $ 33.9 $ 27.9 $ 20.7
Industrial Chemicals (5)......... 2.7 0.4 2.1 0.7
Mineral Products................. 5.7 7.2 5.5 2.5
------- ------- ------- -------
Total segment operating income... 33.8 41.5 35.5 23.9
Unallocated corporate office
items........................ - 0.1 0.1 0.3
Write-off of deferred costs (4).. - - - (7.6)
------- ------- ------- -------
Operating income..................... $ 33.8 $ 41.6 $ 35.6 $ 16.6
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INTERNATIONAL SPECIALTY HOLDINGS INC.
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(1) Operating income in 2000 and 2001 included goodwill amortization
expense for each business segment, as follows:
2000 2001
----- -----
(Millions)
Specialty Chemicals $10.1 $10.6
Industrial Chemicals 2.8 2.8
Mineral Products 3.1 3.1
----- -----
Total $16.0 $16.5
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(2) Operating income for the Specialty Chemicals business segment for
2002 includes $12.2 million of other operating gains. Operating
income for the Industrial Chemicals business segment for 2001 and
2002 includes $1.6 and $0.7 million, respectively, of other
operating gains. See Note 6 to consolidated financial statements in
the Company's 2002 Annual Report on Form 10-K ("2002 Form 10-K") for
further information.
(3) Of the $14.4 million provision for restructuring in 2000 (see Note 7
to consolidated financial statements in the 2002 Form 10-K), $11.9
million relates to the Specialty Chemicals business segment and $2.5
million relates to the Industrial Chemicals business segment. Of the
$0.5 million reversal of restructuring reserves in 2001, $0.4
million relates to the Specialty Chemicals business segment and $0.1
million relates to the Industrial Chemicals business segment.
(4) The write-off of deferred costs of $7.6 million in 2002 (see Note 6
to consolidated financial statements in the 2002 Form 10-K) relates
to the Company's Linden, New Jersey property, a nonoperating
property held for use and therefore not part of the Company's
current operating business segments.
(5) Operating income for the Industrial Chemicals business segment for
the fourth quarter of 2001 and 2002 includes $1.6 and $0.7 million,
respectively, of other operating gains. See Note 6 to consolidated
financial statements in the 2002 Form 10-K.
(6) Operating income for the Specialty Chemicals business segment for
the first and second quarters of 2002 includes $2.8 and $9.4
million, respectively, of other operating gains. See Note 6 to
consolidated financial statements in the 2002 Form 10-K.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
INTERNATIONAL SPECIALTY HOLDINGS INC.
Dated: May 22, 2003 By: /s/ Neal E. Murphy
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Name: Neal E. Murphy
Title: Senior Vice President and
Chief Financial Officer
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