Exhibit 99.1
Milacron's New Orders Up 8%; First Quarter Results In Line With Guidance
CINCINNATI--(BUSINESS WIRE)--May 5, 2005--Milacron Inc. (NYSE:
MZ):
Note: At 1 p.m. EDT today Milacron will hold an open investor
conference call, which can be accessed live at www.milacron.com.
The dial-in number for those interested in asking questions is
(913) 981-4900. A replay of the call will be made available from
4 p.m. today through midnight on May 12 at www.milacron.com or
dial-in at (719) 457-0820, access code: 4446423.
Milacron Inc. (NYSE: MZ) today reported a first quarter 2005 net
loss of $9.1 million, or $0.22 per share, an improvement over the net
loss of $16.6 million, or $0.45 per share, incurred in the first
quarter of 2004. The loss from the year-ago quarter included $6.4
million in refinancing costs and $1.1 million in restructuring
charges; the loss in the most recent quarter included restructuring
charges of $0.4 million.
Sales in the first quarter of 2005 were $192 million, up $3
million from a year ago. Both sales and the net loss were near the
midpoint of the range of guidance provided by the company in February.
New orders in the quarter increased 8% from year-ago levels, to
$202 million, the highest in four years, and exceeded sales by $10
million.
"The plastics machinery market in North America continues to gain
strength, and we are maximizing our participation in this recovery,"
said Ronald D. Brown, chairman, president and chief executive officer.
"We are also expanding our presence in non-traditional markets such as
Asia and Eastern Europe, which helped to offset the softness we
experienced in Western European markets during the first two months of
the quarter. We remain committed to improving our results on a
quarter-to-quarter basis despite the challenges we face from increased
material, energy and regulatory compliance costs," he said.
Before interest, taxes and restructuring and refinancing charges,
Milacron had a loss of $0.3 million in the first quarter of 2005,
compared to earnings of $0.5 million in the first quarter of 2004.
(See reconciliation table.) Profitability in the most recent quarter
was held back by rising material, energy and transportation costs,
which were partially offset by price increases, as well as by higher
pension and regulatory compliance expenses. Incremental costs incurred
by the company to comply with Section 404 of the Sarbanes-Oxley Act of
2002 were $1.5 million in the first quarter and are projected to be
about $4 million for the year.
Cash used by operating activities in the quarter was $6 million,
compared to $42 million in the first quarter of 2004, which included
$33 million to retire a sale-of-receivables program. The primary cause
of cash usage was a build up of inventory during the quarter because
of higher planned shipments in the second quarter.
First Quarter Segment Results
Machinery Technologies-North America (machinery and related parts
and services for injection molding, blow molding and extrusion
supplied from North America and India) Driven primarily by increased,
broad-based demand for injection molding equipment in automotive,
packaging and consumer goods sectors, new orders in the first quarter
of 2005 grew 20% to $95 million from $79 million last year, while
sales rose 13% to $87 million from $77 million. Segment operating
earnings improved to $1.9 million compared to a loss of $0.6 million
in the first quarter of 2004. Further improvement in profitability is
expected as the year progresses.
Machinery Technologies-Europe (machinery and related parts and
services for injection molding and blow molding supplied from Europe)
Slow economic growth (GDP) in Western European countries, combined
with the dampening effect of the strong euro on exports, caused a drop
in demand in the first two months of the quarter. As a result, despite
favorable currency translation effects, first quarter 2005 new orders
declined from the year-ago quarter to $35 million from $40 million,
and sales fell to $34 million from $43 million. This segment had an
operating loss of $2.2 million compared to earnings of $1.1 million in
the year-ago period. In March, however, we saw a pickup in new orders,
which continued into April, and, assuming a continuation of orders at
these levels, we expect operating results in this segment to improve.
Mold Technologies (mold bases and related parts and services, as
well as maintenance, repair and operating (MRO) supplies for injection
molding worldwide) Sales in the first quarter grew to $44 million from
$43 million a year ago, reflecting modest gains in North America.
Despite higher material costs, segment earnings improved to $2.3
million from $1.4 million in the year-ago quarter, largely as a result
of benefits from recent restructuring actions in Europe. Operating
earnings should continue to improve in 2005, as selective price
increases begin to offset higher material costs and we realize further
benefits of recent cost reductions.
Industrial Fluids (water-based and oil-based coolants, lubricants
and cleaners for metalcutting and metalforming operations worldwide)
Sales of $27 million were up $1 million over the first quarter a year
ago primarily due to favorable currency translation effects. Segment
earnings, however, declined to $1.4 million from $2.5 million a year
ago, primarily due to higher material, energy and transportation
costs. During the quarter, we benefited from a one-time litigation
settlement, which was largely offset by increased insurance expenses.
As our recently introduced price increases take hold, this segment is
expected to return to double-digit operating margins beginning in the
second quarter.
Outlook
"Our outlook for 2005 remains positive," Brown said. "U.S.
plastics processors' capacity utilization reached 84.8% in March, the
highest level in five years. And in Western Europe, based on the
upturn in March and April orders, demand for our products made there
appears to be improving. Furthermore, we continue to make good inroads
in Eastern Europe and Asia. With the successful introduction of price
increases and further cost reduction measures, we are finding ways to
compensate for higher costs of materials, energy and regulatory
compliance. We are committed to improving our results throughout 2005
and returning to profitability in the second half of the year."
The forward-looking statements above by their nature involve risks
and uncertainties that could significantly impact operations, markets,
products and expected results. For further information please refer to
the Cautionary Statement included in the company's most recent Form
10-K on file with the Securities and Exchange Commission.
First incorporated in 1884, Milacron is a leading global supplier
of plastics-processing technologies and industrial fluids, with 3,500
employees and major manufacturing facilities in North America, Europe
and Asia. For further information, visit www.milacron.com or call the
toll-free investor line: (800-909-6452).
Milacron Inc. and Subsidiaries
First Quarter 2005
- ----------------------------------------------------------------------
Three Months Ended
March 31,
-----------------------------
2005 2004
- ----------------------------------------------------------------------
Sales $ 192,316,000 $ 188,935,000
Loss from continuing operations (9,093,000) (15,993,000)
Per Share (a)
Basic (0.22) (0.43)
Diluted (0.22) (0.43)
Earnings (loss) from discontinued
operations - (602,000)
Per Share (a)
Basic - (0.02)
Diluted - (0.02)
Net loss (9,093,000) (16,595,000)
Per Share (a)
Basic (0.22) (0.45)
Diluted (0.22) (0.45)
Common shares
Weighted average outstanding for
basic EPS (a) 47,524,000 36,898,000
Weighted average outstanding for
diluted EPS (a) 47,524,000 36,898,000
Outstanding at quarter end 49,702,000 34,830,000
(a) Shares used to compute loss per common share for 2004 have been
restated to reflect the effect of the rights offering completed in
2004.
- ----------------------------------------------------------------------
Note: These statements are unaudited and subject to year-end
adjustments.
Consolidated Earnings
Milacron Inc. and Subsidiaries
First Quarter 2005
- ----------------------------------------------------------------------
(In millions, except per-share data) Three Months Ended
March 31,
---------------------
2005 2004
- ----------------------------------------------------------------------
Sales $ 192.3 $ 188.9
Cost of products sold 160.1 156.1
---------- ----------
Manufacturing margins 32.2 32.8
Percent of sales 16.7% 17.4%
Other costs and expenses
Selling and administrative 33.5 30.9
Refinancing costs (a) - 6.4
Restructuring costs (b) 0.4 1.1
Other (income) expense - net (1.0) 1.4
---------- ----------
Total other costs and expenses 32.9 39.8
---------- ----------
Operating loss (0.7) (7.0)
Interest expense - net (8.2) (7.9)
---------- ----------
Loss from continuing operations before
income taxes (8.9) (14.9)
Provision for income taxes 0.2 1.1
---------- ----------
Loss from continuing operations (9.1) (16.0)
Discontinued operations - net of income taxes (c) - (0.6)
---------- ----------
Net loss $ (9.1) $ (16.6)
========== ==========
Loss per common share - basic and diluted (d)
Continuing operations $ (0.22) $ (0.43)
Discontinued operations - (0.02)
---------- ----------
Net loss $ (0.22) $ (0.45)
========== ==========
(a) Represents costs incurred in pursuing various alternatives to the
company's March 12, 2004 refinancing of $200 million of debt and
other obligations.
(b) Represents costs related to initiatives to reduce operating and
administrative costs.
(c) Reflects the presentation of Grinding Wheels as a discontinued
operation.
(d) The numbers of shares used to compute loss per common share data
for 2004 have been restated to reflect the effect of the 2004
rights offering which allowed shareholders to purchase additional
shares at a discounted price of $2.00 per share.
- ----------------------------------------------------------------------
Note: These statements are unaudited and subject to year-end
adjustments.
Consolidated Balance Sheets
Milacron Inc. and Subsidiaries
First Quarter 2005
- ----------------------------------------------------------------------
(In millions) March 31, March 31,
2005 2004
- ----------------------------------------------------------------------
Assets
Cash and cash equivalents $ 43.7 $ 62.0
Notes and accounts receivable-net 128.1 123.0
Inventories (a) 161.3 148.2
Other current assets 46.5 71.3
Assets of discontinued operations (b) - 9.9
---------- ----------
Total current assets 379.6 414.4
Property, plant and equipment - net 124.0 135.3
Goodwill 85.8 83.3
Other noncurrent assets 116.0 113.7
---------- ----------
Total assets $ 705.4 $ 746.7
========== ==========
Liabilities and shareholders' equity (deficit)
Short-term borrowings and long-term debt due
within one year (c) $ 3.7 $ 188.4
Trade accounts payable and advance billings and
deposits 88.9 82.0
Accrued and other current liabilities 99.2 114.7
Liabilities of discontinued operations (b) - 1.5
---------- ----------
Total current liabilities 191.8 386.6
Long-term accrued liabilities 243.4 233.5
Long-term debt 235.3 159.7
Shareholders' equity (deficit) 34.9 (33.1)
---------- ----------
Total liabilities and shareholders'
equity (deficit) $ 705.4 $ 746.7
========== ==========
(a) The amount for 2004 has been restated due to a change in the
method of valuing certain inventories from the LIFO method to the
FIFO method.
(b) Reflects the presentation of Grinding Wheels as a discontinued
operation.
(c) In 2005, no borrowings were drawn against the revolving credit
facility. Outstanding letters of credit were $10 million.
- ----------------------------------------------------------------------
Note: These statements are unaudited and subject to year-end
adjustments.
Consolidated Cash Flows
Milacron Inc. and Subsidiaries
First Quarter 2005
- ----------------------------------------------------------------------
(In millions) Three Months Ended
March 31,
---------------------
2005 2004
- ----------------------------------------------------------------------
Increase (decrease) in cash and cash equivalents
Operating activities cash flows
Net Loss $ (9.1) $ (16.6)
Loss from discontinued operations - 0.6
Depreciation and amortization 4.5 5.3
Refinancing costs - 6.4
Restructuring costs 0.4 1.1
Working capital changes
Notes and accounts receivable (a) 5.2 (30.0)
Inventories (9.0) 0.1
Other current assets 2.6 (10.8)
Trade accounts payable (4.6) (2.1)
Other current liabilities 1.2 (0.1)
Deferred income taxes and other - net 2.6 3.9
---------- ----------
Net cash used by operating activities (6.2) (42.2)
Investing activities cash flows
Capital expenditures (1.5) (1.5)
Other - net 0.2 0.3
---------- ----------
Net cash used by investing activities (1.3) (1.2)
Financing activities cash flows
Repayments of long-term debt (3.8) (115.4)
Increase (decrease) in short-term borrowings (10.2) 140.4
Debt issuance costs (0.6) (8.3)
Costs of 2004 rights offering (1.1) -
Dividends paid (1.6) -
---------- ----------
Net cash provided (used) by financing
activities (17.3) 16.7
Effect of exchange rate fluctuations on cash
and cash equivalents (0.7) (0.6)
Cash flows related to discontinued operations - (3.5)
---------- ----------
Decrease in cash and cash equivalents (25.5) (30.8)
Cash and cash equivalents at beginning of period 69.2 92.8
---------- ----------
Cash and cash equivalents at end of period $ 43.7 $ 62.0
========== ==========
(a) In 2004, includes $33 million representing the effect of the
repayment of the amounts that were previously sold on the
receivables sale program.
- ----------------------------------------------------------------------
Note: These statements are unaudited and subject to year-end
adjustments.
Segment and Supplemental Information
Milacron Inc. and Subsidiaries
First Quarter 2005
- ----------------------------------------------------------------------
(In millions) Three Months Ended
March 31,
---------------------
2005 2004 (a)
- ----------------------------------------------------------------------
Machinery technologies North America
Sales $ 87.1 $ 77.3
Operating cash flow (b) 3.5 1.4
Segment earnings (loss) 1.9 (0.6)
Percent of sales 2.2% -0.8%
New orders 94.9 79.1
Machinery technologies Europe
Sales $ 34.3 $ 42.5
Operating cash flow (b) (1.2) 2.2
Segment earnings (loss) (2.2) 1.1
Percent of sales -6.4% 2.6%
New orders 35.4 40.0
Mold technologies
Sales $ 44.2 $ 43.3
Operating cash flow (b) 3.7 3.0
Segment earnings 2.3 1.4
Percent of sales 5.2% 3.2%
New orders 45.1 43.0
Eliminations
Sales $ (0.3) $ (0.4)
New orders (0.4) (1.3)
Total plastics technologies
Sales $ 165.3 $ 162.7
Operating cash flow (b) 6.0 6.6
Segment earnings 2.0 1.9
Percent of sales 1.2% 1.2%
New orders 175.0 160.8
Industrial fluids
Sales $ 27.0 $ 26.2
Operating cash flow (b) 1.9 3.0
Segment earnings 1.4 2.5
Percent of sales 5.2% 9.5%
New orders 27.0 26.2
Total continuing operations
Sales $ 192.3 $ 188.9
Operating cash flow (b) 4.2 5.8
Segment earnings 3.4 4.4
Refinancing costs (c) - (6.4)
Restructuring costs (d) (0.4) (1.1)
Corporate expenses (3.5) (3.3)
Other unallocated expenses (e) (0.2) (0.6)
---------- ----------
Operating loss (0.7) (7.0)
Percent of sales -0.4% -3.7%
New orders 202.0 187.0
Ending backlog 96.0 89.5
(a) Reflects the presentation of Grinding Wheels as a discontinued
operation.
(b) Represents EBITDA (earnings before interest, income taxes,
depreciation and amortization) before refinancing costs and
restructuring costs.
(c) Represents costs incurred in pursuing various alternatives to the
company's March 12, 2004 refinancing of $200 million of debt and
other obligations.
(d) Represents costs related to initiatives to reduce operating and
administrative costs.
(e) Other unallocated expenses include financing costs including costs
related to the sale of accounts receivable prior to March 12,
2004.
- ----------------------------------------------------------------------
Note: These statements are unaudited and subject to year- end
adjustments.
Reconciliation of Earnings to Operating Cash Flows
Milacron Inc. and Subsidiaries
First Quarter 2005
- ----------------------------------------------------------------------
(In millions) Three Months Ended
March 31,
-------------------
2005 2004
- ----------------------------------------------------------------------
Machinery technologies North America
Segment earnings (loss) $ 1.9 $ (0.6)
Depreciation and amortization 1.6 2.0
--------- ---------
Operating cash flow 3.5 1.4
Machinery technologies Europe
Segment earnings (loss) $ (2.2) $ 1.1
Depreciation and amortization 1.0 1.1
--------- ---------
Operating cash flow (1.2) 2.2
Mold technologies
Segment earnings $ 2.3 $ 1.4
Depreciation and amortization 1.4 1.6
--------- ---------
Operating cash flow 3.7 3.0
Total plastics technologies
Segment earnings $ 2.0 $ 1.9
Depreciation and amortization 4.0 4.7
--------- ---------
Operating cash flow 6.0 6.6
Industrial fluids
Segment earnings $ 1.4 $ 2.5
Depreciation and amortization 0.5 0.5
--------- ---------
Operating cash flow 1.9 3.0
Total continuing operations
Net Loss $ (9.1) $ (16.6)
Loss from discontinued operations (a) - 0.6
Provision for income taxes 0.2 1.1
Interest expense - net 8.2 7.9
Refinancing costs (b) - 6.4
Restructuring costs (c) 0.4 1.1
Depreciation and amortization 4.5 5.3
--------- ---------
Operating cash flow $ 4.2 $ 5.8
========= =========
(a) Reflects the presentation of Grinding Wheels as a discontinued
operation.
(b) Represents costs incurred in pursuing various alternatives to the
company's March 12, 2004 refinancing of $200 million of debt and
other obligations.
(c) Represents costs related to initiatives to reduce operating and
administrative costs.
- ----------------------------------------------------------------------
Note: These statements are unaudited and subject to year-end
adjustments.
Reconciliation of Consolidated Earnings to Internal Reporting Measures
Milacron Inc. and Subsidiaries
First Quarter 2005
- ----------------------------------------------------------------------
(In millions, except per-share data) Three Months Ended
March 31,
---------------------
2005 2004
- ----------------------------------------------------------------------
Net loss $ (9.1) $ (16.6)
Discontinued operations-net of income taxes (a) - 0.6
---------- ----------
Loss from continuing operations (9.1) (16.0)
Provision for income taxes (0.2) (1.1)
---------- ----------
Loss from continuing operations before
income taxes (8.9) (14.9)
Interest expense - net 8.2 7.9
---------- ----------
Operating loss (0.7) (7.0)
Refinancing costs (b) - 6.4
Restructuring costs (c) 0.4 1.1
---------- ----------
Earnings (loss) from continuing operations before
interest, income taxes, refinancing costs and
restructuring costs $ (0.3) $ 0.5
========== ==========
Loss per common share - basic and diluted (d) $ (0.22) $ (0.43)
Continuing operations - (0.02)
---------- ----------
Discontinued operations $ (0.22) $ (0.45)
========== ==========
Net loss
(a) Reflects the presentation of Grinding Wheels as a discontinued
operation.
(b) Represents costs incurred in pursuing various alternatives to the
company's March 12, 2004 refinancing of $200 million of debt and
other obligations.
(c) Represents costs related to initiatives to reduce operating and
administrative costs.
(d) The numbers of shares used to compute loss per common share data
for 2004 have been restated to reflect the effect of the 2004
rights offering which allowed shareholders to purchase additional
shares at a discounted price of $2.00 per share.
- ----------------------------------------------------------------------
Note: These statements are unaudited and subject to year-end
adjustments.
Historical Information
- ----------------------------------------------------------------------
(In millions, except per-share data)
2003 (a)
--------------------------------------------
Qtr 1 Qtr 2 Qtr 3 Qtr 4 Year
- ----------------------------------------------------------------------
Sales $ 190.2 $ 181.6 $ 170.2 $ 197.7 $ 739.7
Cost of products sold 158.2 149.6 138.6 157.4 603.8
Cost of products sold
related to restructuring - 3.8 - (0.5) 3.3
-------- -------- -------- -------- --------
Total cost of products
sold 158.2 153.4 138.6 156.9 607.1
-------- -------- -------- -------- --------
Manufacturing margins 32.0 28.2 31.6 40.8 132.6
Other costs and expenses
Selling and
administrative 30.2 34.3 30.7 33.8 129.0
Goodwill impairment
charge - - 52.3 13.3 65.6
Refinancing costs - - 1.0 0.8 1.8
Restructuring costs 6.0 2.5 6.4 8.9 23.8
Other - net 0.7 1.6 (1.2) (1.4) (0.2)
-------- -------- -------- -------- --------
Total other costs
and expenses 36.9 38.4 89.2 55.4 220.0
-------- -------- -------- -------- --------
Operating loss (4.9) (10.2) (57.6) (14.6) (87.4)
Interest expense - net (5.2) (5.8) (5.9) (6.1) (23.0)
-------- -------- -------- -------- --------
Loss from continuing
operations before income
taxes and cumulative
effect of change in
method of accounting (10.1) (16.0) (63.5) (20.7) (110.4)
Provision (benefit) from
income taxes (2.5) 72.1 1.8 2.0 73.3
-------- -------- -------- -------- --------
Earnings (loss) from
continuing operations
before cumulative
effect of change
in method of accounting (7.6) (88.1) (65.3) (22.7) (183.7)
Discontinued operations-
net of income taxes (b)
Loss from operations (0.7) (3.0) (2.0) (0.7) (6.4)
Net gain (loss) on
divestitures - - - (0.8) (0.8)
-------- -------- -------- -------- --------
Total discontinued
operations (0.7) (3.0) (2.0) (1.5) (7.2)
Cumulative effect of
change in method
of accounting - - - - -
-------- -------- -------- -------- --------
Net earnings (loss) $ (8.3) $ (91.1) $ (67.3) $ (24.2) $(190.9)
======== ======== ======== ======== ========
Earnings (loss) per common
share
Basic and diluted
Continuing
operations $ (0.21) $ (2.41) $ (1.78) $ (0.62) $ (5.02)
Discontinued
operations (0.02) (0.08) (0.05) (0.04) (0.19)
-------- -------- -------- -------- --------
Net earnings
(loss) $ (0.23) $ (2.49) $ (1.83) $ (0.66) $ (5.21)
======== ======== ======== ======== ========
Historical Information
- ----------------------------------------------------------------------
(In millions, except per-share data)
2004 2005
--------------------------------------- -------
Qtr 1 Qtr 2 Qtr 3 Qtr 4 Year Qtr 1
- -------------------------------------------------------------- -------
Sales $188.9 $191.7 $180.5 $213.1 $774.2 $192.3
Cost of products sold 156.1 156.2 144.6 169.7 626.6 160.1
Cost of products sold
related to
restructuring - - 1.7 (0.3) 1.4 -
------- ------- ------- ------- ------- -------
Total cost of
products sold 156.1 156.2 146.3 169.4 628.0 160.1
------- ------- ------- ------- ------- -------
Manufacturing
margins 32.8 35.5 34.2 43.7 146.2 32.2
Other costs and
expenses
Selling and
administrative 30.9 30.8 30.8 34.4 126.9 33.5
Goodwill impairment
charge - - - - - -
Refinancing costs 6.4 14.6 0.4 - 21.4 -
Restructuring costs 1.1 1.7 0.6 8.2 11.6 0.4
Other - net 1.4 (0.1) 0.5 1.1 2.9 (1.0)
------- ------- ------- ------- ------- -------
Total other costs
and expenses 39.8 47.0 32.3 43.7 162.8 32.9
------- ------- ------- ------- ------- -------
Operating loss (7.0) (11.5) 1.9 - (16.6) (0.7)
Interest expense - net (7.9) (15.3) (6.6) (7.5) (37.3) (8.2)
------- ------- ------- ------- ------- -------
Loss from continuing
operations before
income taxes and
cumulative effect of
change in method of
accounting (14.9) (26.8) (4.7) (7.5) (53.9) (8.9)
Provision (benefit)
from income taxes 1.1 1.1 0.8 (5.6) (2.6) 0.2
------- ------- ------- ------- ------- -------
Earnings (loss) from
continuing operations
before cumulative
effect of change in
method of accounting (16.0) (27.9) (5.5) (1.9) (51.3) (9.1)
Discontinued
operations-net of
income taxes (b)
Loss from operations (0.6) (0.7) - - (1.3) -
Net gain (loss) on
divestitures - 0.8 - - 0.8 -
------- ------- ------- ------- ------- -------
Total
discontinued
operations (0.6) 0.1 - - (0.5) -
Cumulative effect of
change in method
of accounting - - - - - -
------- ------- ------- ------- ------- -------
Net earnings (loss) $(16.6) $(27.8) $ (5.5) $ (1.9) $(51.8) $ (9.1)
======= ======= ======= ======= ======= =======
Earnings (loss) per
common share
Basic and diluted
Continuing
operations $(0.43) $(0.61) $(0.18) $(0.08) $(1.33) $(0.22)
Discontinued
operations (0.02) 0.01 - - (0.01) -
------- ------- ------- ------- ------- -------
Net earnings
(loss) $(0.45) $(0.60) $(0.18) $(0.08) $(1.34) $(0.22)
======= ======= ======= ======= ======= =======
(a) In the fourth quarter of 2004, the company elected to change its
method of accounting for certain inventories from the LIFO method
to the FIFO method, retroactive to the beginning of the year.
Financial results for 2003 have been restated to conform to the
2004 presentation. The effect was to increase net earnings by $.8
million in 2003.
(b) Reflects the presentation of Grinding Wheels and Round Tools as
discontinued operations.
Historical Segment and Supplemental Information
- ----------------------------------------------------------------------
(In Millions)
2003 (a)
---------------------------------------
Qtr 1 Qtr 2 Qtr 3 Qtr 4 Year
- ----------------------------------------------------------------------
Machinery technologies North
America
Sales $ 88.3 $ 74.7 $ 71.6 $ 86.6 $321.2
Operating cash flow (b) 4.6 0.8 3.2 8.2 16.8
Segment earnings (loss) (a) 2.1 (1.4) 1.3 6.1 8.1
New orders 84.9 83.5 74.4 82.0 324.8
Machinery technologies Europe
Sales $ 35.0 $ 38.9 $ 33.4 $ 43.7 $151.0
Operating cash flow (b) 0.3 (0.8) 0.6 2.4 2.5
Segment earnings (loss) (0.7) (1.8) (0.4) 1.5 (1.4)
New orders 33.3 38.8 36.9 44.5 153.5
Mold technologies
Sales $ 44.6 $ 43.0 $ 39.1 $ 42.0 $168.7
Operating cash flow (b) 2.0 1.8 1.8 2.9 8.5
Segment earnings (loss) 0.3 0.1 0.1 1.3 1.8
New orders 44.7 42.5 39.4 42.1 168.7
Eliminations
Sales $ (3.0) $ (1.3) $ (0.3) $ (0.8) $ (5.4)
New orders (1.2) (1.4) (0.7) (1.0) (4.3)
Total plastics
technologies
Sales $164.9 $155.3 $143.8 $171.5 $635.5
Operating cash flow (b) 6.9 1.8 5.6 13.5 27.8
Segment earnings (loss) (a) 1.7 (3.1) 1.0 8.9 8.5
New orders 161.7 163.4 150.0 167.6 642.7
Industrial fluids
Sales $ 25.3 $ 26.3 $ 26.4 $ 26.2 $104.2
Operating cash flow (b) 4.0 4.2 5.2 4.3 17.7
Segment earnings 3.5 3.7 4.8 3.7 15.7
New orders 25.3 26.3 26.4 26.3 104.3
Total continuing operations (c)
Sales $190.2 $181.6 $170.2 $197.7 $739.7
Operating cash flow (b) 6.7 1.7 7.2 13.3 28.8
Segment earnings (loss) (a) 5.2 0.6 5.8 12.6 24.2
Goodwill impairment charges
(d) - - (52.3) (13.3) (65.6)
Refinancing costs (e) - - (1.0) (0.8) (1.8)
Restructuring costs (f) (6.0) (6.3) (6.4) (8.4) (27.1)
Corporate expenses (3.5) (3.7) (3.1) (4.0) (14.3)
Other unallocated expenses (g) (0.8) (0.7) (0.6) (0.7) (2.8)
------- ------- ------- ------- -------
Operating earnings (loss) (5.1) (10.1) (57.6) (14.6) (87.4)
Percent of sales -2.7% -5.7% -34.1% -7.8% -11.8%
New orders 187.0 189.7 176.4 193.9 747.0
Ending backlog 74.7 85.4 91.7 92.0 92.0
(In Millions)
2004 2005
-------------------------------------------- -------
Qtr 1 Qtr 2 Qtr 3 Qtr 4 Year Qtr 1
- ----------------------------------------------------------------------
Machinery
technologies
North America
Sales $ 77.3 $ 83.2 $ 77.2 $ 96.7 $334.4 $ 87.1
Operating cash
flow (b) 1.4 5.3 5.9 10.8 23.4 3.5
Segment earnings
(loss) (a) (0.6) 3.4 4.1 9.1 16.0 1.9
New orders 79.1 87.2 80.3 90.5 337.1 94.9
Machinery
technologies
Europe
Sales $ 42.5 $ 42.4 $ 37.5 $ 44.6 $167.0 $ 34.3
Operating cash
flow (b) 2.2 2.3 0.8 0.8 6.1 (1.2)
Segment earnings
(loss) 1.1 1.3 (0.3) (0.2) 1.9 (2.2)
New orders 40.0 45.7 36.3 33.0 155.0 35.4
Mold technologies
Sales $ 43.3 $ 39.9 $ 39.6 $ 44.3 $167.1 $ 44.2
Operating cash
flow (b) 3.0 1.5 2.7 3.8 11.0 3.7
Segment earnings
(loss) 1.4 (0.1) 1.1 1.9 4.3 2.3
New orders 43.0 40.5 39.5 44.8 167.8 45.1
Eliminations
Sales $ (0.4) $ (1.5) $ (0.4) $ (1.0) $ (3.3) $ (0.3)
New orders (1.3) (1.0) (0.2) (0.1) (2.6) (0.4)
Total plastics
technologies
Sales $162.7 $164.0 $153.9 $184.6 $665.2 $165.3
Operating cash
flow (b) 6.6 9.1 9.4 15.4 40.5 6.0
Segment earnings
(loss) (a) 1.9 4.6 4.9 10.8 22.2 2.0
New orders 160.8 172.4 155.9 168.2 657.3 175.0
Industrial fluids
Sales $ 26.2 $ 27.7 $ 26.6 $ 28.5 $109.0 $ 27.0
Operating cash
flow (b) 3.0 3.9 3.3 0.8 11.0 1.9
Segment earnings 2.5 3.4 2.8 0.5 9.2 1.4
New orders 26.2 27.8 26.6 28.5 109.1 27.0
Total continuing
operations (c)
Sales $188.9 $191.7 $180.5 $213.1 $774.2 $192.3
Operating cash
flow (b) 5.8 9.9 9.6 12.8 38.1 4.2
Segment earnings
(loss) (a) 4.4 8.0 7.7 11.3 31.4 3.4
Goodwill
impairment
charges (d) - - - - - -
Refinancing
costs (e) (6.4) (14.6) (0.4) - (21.4) -
Restructuring
costs (f) (1.1) (1.7) (2.3) (7.9) (13.0) (0.4)
Corporate
expenses (3.3) (2.9) (2.6) (3.1) (11.9) (3.5)
Other
unallocated
expenses (g) (0.6) (0.3) (0.5) (0.3) (1.7) (0.2)
------- ------- ------- ------- ------- -------
Operating
earnings (loss) (7.0) (11.5) 1.9 - (16.6) (0.7)
Percent of
sales -3.7% -6.0% 1.1% 0.7% -2.1% -0.4%
New orders 187.0 200.2 182.5 196.7 766.4 202.0
Ending backlog 89.5 97.7 100.1 87.3 87.3 96.0
(a) In the fourth quarter of 2004, the company elected to change its
method of accounting for certain inventories from the LIFO method
to the FIFO method, retroactive to the beginning of the year.
Financial results for 2003 have been restated to conform to the
2004 presentation.
(b) Represents EBITDA (earnings before interest, income taxes,
depreciation and amortization) before refinancing costs and
restructuring costs.
(c) Reflects the presentation of Grinding Wheels and Round Tools as
discontinued operations.
(d) Represents charges to adjust the carrying value of goodwill in the
mold technologies segment.
(e) In 2003 and the first quarter of 2004, represents costs incurred
in pursuing various alternatives to the company's March 12, 2004
refinancing of $200 million in debt and other obligations. In the
second and third quarters of 2004, represents costs that resulted
from the refinancing and recapitalization of the company.
(f) Represents costs related to initiatives to reduce operating and
administrative costs.
(g) Other unallocated expenses include financing costs including costs
related to the sale of accounts receivable prior to March 12,
2004.
Estimates and Projections for Updated: May 5, 2005
Financial Modeling
Note: The amounts below are approximate working estimates, around
which an even wider range of numbers could be used for financial
modeling purposes. These estimates, by their nature, involve a great
number of risks and uncertainties. Actual results may differ as these
risks and uncertainties could significantly impact the company's
markets, products, and operations. For further information please
refer to the Cautionary Statement included in Item 7 of the company's
most recent Form 10-K on file with the Securities and Exchange
Commission.
- ----------------------------------------------------------------------
Quarter Ended Year Ended
------------- -------------
(In millions) Jun. 30, 2005 Dec. 31, 2005
- ----------------------------------------------------------------------
Projected profit & loss items
Sales (1) $198 - 212 $825 - 855
Total plastics technologies 170 - 180 710 - 730
Industrial fluids 28 - 32 115 - 125
Segment earnings
Total plastics technologies 3 - 5 25 - 32
Industrial fluids 3 - 5 13 - 16
Corporate expenses 3 - 4 12 - 13
Interest expense - net 7 - 8 31 - 32
Provision for income taxes less than 1 4 - 5
Restructuring costs less than 1 1
Earnings (loss) after tax (2) (6) - 0 (13) - 0
Average shares outstanding - basic 47 - 48 47 - 48
Average shares outstanding - diluted 97 - 98 100 - 102
Projected cash flow & balance sheet items
Depreciation 4 - 5 20 - 21
Working capital - increase
(decrease) (3) (6) - (2) 0 - 10
Cash pension contribution less than 1 2 - 3
Capital expenditures 4 - 5 14 - 16
Cash interest 13 - 14 27 - 28
Cash dividends 1.5 6
Cash taxes - less than 1
Cash restructuring - less than 1
1 Sales - Includes increased sales over the same periods a year ago
due to the strengthening of the Euro of approximately $5 million and
$14 million in quarter ended Jun. 30, 2005, and year ended Dec. 31,
2005, respectively.
2 Earnings (loss) after tax - Includes $2.8 million and $11.3 million
of expenses related to the U.S defined benefit plan in quarter ended
Jun. 30, 2005 and year ended Dec. 31, 2005, respectively (versus
$1.6 million and $6.4 million in quarter ended Jun. 30, 2004 and
year ended Dec. 31 2004, respectively).
Includes $1.9 million and $6.0 million of expenses related to
Sarbanes-Oxley compliance in quarter ended Jun. 30, 2005 and year
ended Dec. 31, 2005, respectively (versus $0.1 million and $2.0
million in quarter ended Jun. 30, 2004 and year ended Dec. 31, 2004,
respectively).
3 Working capital = inventory + receivables - trade payables - advance
billings
Comments & explanations
Assumes quarter ended Mar. 31, 2005 foreign exchange rates (e.g.,
USD/EUR = 1.2988), and no further acquisitions, divestitures or
restructuring initiatives.
CONTACT: Milacron Inc.
Al Beaupre, 513-487-5918