Olin Corporation Reports Second Quarter Results

    NORWALK, Conn., July 24 /PRNewswire/ -- Olin Corporation (NYSE:   OLN) today
 announced second quarter fully diluted earnings from continuing operations of
 $.75 per share, compared with $.96 per share for the second quarter of 1996.
 Net income from continuing operations for the second quarter of 1997 was $38.6
 million compared with $50.7 million in 1996. Total company fully diluted
 earnings per share and net income reported for the second quarter of 1996 were
 $.98 per share and $51.7 million, respectively.
     Sales and operating income for the second quarter of 1997 were $632.4 and
 $58.6 million, respectively.  On a comparable basis, excluding the results of
 the isocyanates businesses sold in December of 1996, sales and operating
 income in the second quarter of 1996 were $625.2 million and $70.2 million
 respectively.  On this basis, 1997 results represent a 1% increase in sales,
 and a 17% decrease in operating income.
     Donald W. Griffin, chairman, president and chief executive officer said,
 "Our second quarter results primarily reflect lower pricing in the chlor
 alkali industry,  slower than anticipated recovery in certain microelectronic
 material markets, and the absence of earnings from our TDI and ADI businesses
 which were divested last year.  Olin is well positioned for future earnings
 growth when demand and pricing improve in our key markets.  We expect that
 tight supply-demand will increase pricing for our chlor alkali products and
 that demand will accelerate for our microelectronic materials as the year
 progresses."
     The following commentary compares segment operating income for the second
 quarter of 1997 and 1996:
 
     CHEMICALS
     Chemicals segment operating income was $46 million in the second quarter
 of 1997, compared with $65.7 million as reported for 1996, and $56.2 million
 excluding the TDI/ADI isocyanates business.  Chlor-alkali sales and profits
 were reduced primarily due to lower caustic pricing.  Pool chemicals profits
 were about equal  as higher pricing was offset by lower sales caused by
 unseasonably cool spring weather.  Microelectronic materials income trailed
 last year because of lower demand for certain higher-margin products and a
 slower than anticipated industry recovery in our product sectors.  Higher
 sales and lower operating costs led to an increase in biocides profits.
 
     METALS and AMMUNITION
     Metals and ammunition operating income was $12.6 million, compared with
 $14.0  million.   Metals segment revenue increased due to higher metals
 volumes and favorable product mix; however profits were marginally behind last
 year.  The Indianapolis operations had lower shipments and incurred higher
 maintenance costs due in part to their shutdown being taken in the second
 quarter this year compared with the third quarter in 1996.  Additionally,
 there were lower shipments of Fineweld(R) tube and government-related products
 which more than offset higher earnings at the A.J. Oster Company.
 Winchester's operating results trailed last year due to lower sales.
 
     INTEREST INCOME
     During the second quarter of 1997 the company had interest income of
 approximately $2,700,000, compared with $600,000 in the prior year's period.
 
     SHARE REPURCHASE PROGRAM
     During the second quarter of 1997 the company repurchased 1,100,000 shares
 of its common stock.  The company commenced its share repurchase program for
 up to 10% of its common stock, or 5,000,000 shares in January.   Through June
 30 repurchases under this program have been approximately 2,135,000 shares.
 
     BRANDENBURG, KY,  BUSINESS / SITE UPDATE
     After an extensive review of a variety of options regarding the businesses
 and assets at its Brandenburg, KY, site, the company has concluded the maximum
 economic value would be realized from the retention of the non-foam polyol
 business.
     The company said that it had completed the solicitation of bids for the
 remaining surfactants, glycols, flexible polyols and disulfonates businesses
 at the site and was in negotiations that it said would lead either to the sale
 or repositioning of those businesses.  The company also conducts research and
 manufacturing activities for its Microelectronic Materials Division and is the
 operator of other manufacturing assets currently owned or leased by third
 parties at the Brandenburg site.  These activities will not be impacted by the
 company's plans.
 
     Fineweld Tube is a registered trademark of Olin Corporation.
 
                                OLIN CORPORATION
                      Consolidated Statements of Income(a)
                    (In millions, except per share amounts)
 
                                 Three Months          Six Months
                                 Ended June 30,       Ended June 30,
                                1997      1996(b)    1997       1996(b)
     Sales                     632.4     701.7     1223.6     1394.6
     Cost of Goods Sold        491.6     529.2      941.5    1,057.6
     Selling and Administration 75.0      83.0      147.4      163.9
     Research and Development    7.2       9.8       14.6       19.8
          Operating Income      58.6      79.7      120.1      153.3
     Interest Expense            7.0       8.0       14.5       15.9
     Interest Income             2.7       0.6        8.7        0.9
     Other Income (c)            4.6       5.6        8.4       16.1
        Income from Continuing
          Operations Before
          Taxes                 58.9      77.9      122.7      154.4
     Income Taxes               20.3      27.2       42.3       53.0
     Income from Continuing
       Operations               38.6      50.7       80.4      101.4
          Income (Loss) from
             Discontinued
             Operations, Net of
             Taxes (d)            --       1.0         --       (4.7)
     Net Income               $ 38.6    $ 51.7     $ 80.4       96.7
 
     Net Income (Loss) Per Common Share:
     Primary:
         Continuing Operations  0.75      0.99       1.56       1.98
         Discontinued
           Operations (d)          0      0.02          0       (0.1)
     Total Net Income           0.75      1.01       1.56       1.88
     Fully Diluted:
         Continuing Operations  0.75      0.96       1.55       1.92
         Discontinued
           Operations (d)          0      0.02          0      (0.09)
     Total Net Income           0.75      0.98       1.55       1.83
     Dividends Per Common Share  0.3       0.3        0.6        0.6
     Average Common Shares
        Outstanding - Fully
        Diluted                 51.2      52.1       51.7       52.0
 
     (a)  Unaudited
     (b)  The three months and six months ended June 30, 1996 operating
          results include the isocyanates businesses which were sold on
          December 4, 1996 (sales $76.5 and $158.0, operating income $9.5
          and $29.0, fully diluted earnings per share $.06 and $.32,
          respectively)
     (c)  The six months ended June 30, 1996 include a gain of $7.0 related to
          the sale of the company's former headquarters in Stamford, CT.
     (d)  Represents the net income (loss) of the former Aerospace and Ordnance
          divisions spun-off as Primex Technologies, Inc. on December 31, 1996.
 
                                OLIN CORPORATION
                            Segment Information (a)
 
                                 Three Months            Six Months
                                 Ended June 30,         Ended June 30,
                                1997       1996        1997        1996
     Sales:
       Chemicals Continuing
          Businesses         $ 365.0    $ 363.4     $ 692.2     $ 696.4
       Chemicals Businesses
          Sold (b)                --       76.5          --         158
         Total Chemicals         365      439.9       692.2       854.4
       Metals & Ammunition     267.4      261.8       531.4       540.2
             Total Sales     $ 632.4    $ 701.7   $ 1,223.6   $ 1,394.6
 
     Operating Income:
       Chemicals Continuing
            Businesses        $ 46.0     $ 56.2      $ 95.4      $ 97.1
       Chemicals Businesses
            Sold (b)              --        9.5          --          29
         Total Chemicals          46       65.7        95.4       126.1
         Metals & Ammunition    12.6         14        24.7        27.2
            Total Operating
              Income            58.6       79.7        120.1      153.3
 
     Sales Analysis (a) (percent change from prior year's period)
     Chemicals
        Selling Price             (2)%                   (2)%
        Volume                    (1)%                   (1)%
        Acquisition                3%                     3%
        Divestment               (17)%                  (19)%
          Total Chemicals        (17)%                  (19)%
 
     Metals & Ammunition
        Selling Price              --                    --
        Metal Price
         Pass-Throughs            (1)%                     (3)%
       Volume                      3%                       1%
         Total Metals &
           Ammunition              2%                      (2)%
     Total
       Selling Price              (1)%                     (1)%
       Metal Price Pass-Throughs  (1)%                     (1)%
       Volume                      1%                      (1)%
       Acquisition                 2%                       2%
       Divestment                (11)%                    (11)%
         Total                   (10)%                    (12)%
 
     (a) Unaudited
     (b) Represents the sales and operating income of the isocyanates
         businesses which were sold on December 4, 1996.
 
                                OLIN CORPORATION
                        Consolidated Balance Sheets (a)
                                 (in millions)
 
                                                             June 30,
                                                        1997           1996
 
     Assets:
     Cash & Cash Equivalents                           $22.0           $4.5
     Short-Term Investments                             58.7             --
     Accounts Receivable, Net                          413.5          467.8
     Inventories                                       341.3          387.6
     Other Current Assets                               94.7           72.6
        Total Current Assets                           930.2          932.5
     Investments and Advances - Affiliated
      Companies at Equity                              104.4           84.2
     Property, Plant and Equipment (Less
      Accumulated Depreciation of
      $1,476.0 and  $1,603.0)                          741.6          805.4
     Other Assets                                      153.3          137.1
     Net Assets of Discontinued Operations (b)            --          275.7
        Total Assets                                 $1929.5        $2234.9
 
     Liabilities and Shareholders' Equity:
     Current Debt                                       $7.8         $270.2
     Accounts Payable                                  209.1          227.7
     Accrued Liabilities                               255.1          305.5
        Total Current Liabilities                      472.0          803.4
     Long-Term Senior Debt                             268.6          277.1
     Other Liabilities                                 273.9          229.4
     Shareholders' Equity:
        Preferred Stock, Par Value $1 Per Share,
         Authorized 10.0 Shares: ESOP Preferred
         Stock, Issued 1.0 Shares                         --           73.9
        Common Stock, Par Value $1 Per Share,
         Authorized 120.0 Shares: Issued 50.3
         Shares (49.9 in 1996) (c)                      50.3           49.9
        Additional Paid-in Capital (c)                 414.5          409.1
        ESOP Obligations                                  --          (10.0)
        Cumulative Translation Adjustment              (12.7)          (5.2)
        Retained Earnings                              462.9          407.3
           Total Shareholders' Equity                  915.0          925.0
     Total Liabilities and Shareholders' Equity      $1929.5        $2234.9
 
     (a) Unaudited
     (b) Represents the net assets of the former Aerospace and Ordnance
         divisions spun-off as Primex Technologies, Inc. on December 31, 1996
     (c) 1996 amounts have been adjusted for the two-for-one split of the
         company's common stock, effective October 30, 1996.
 
                                OLIN CORPORATION
                   Consolidated Statements of Cash Flows (a)
                                 (In millions)
 
                                                     Six Months Ended June 30,
                                                        1997           1996
 
     Operating Activities:
     Income from Continuing Operations                 $80.4         $101.4
     Earnings of Non-consolidated Affiliates            (5.1)          (4.9)
     Depreciation and Amortization                      59.5           63.9
     Deferred Taxes                                     11.4            1.4
     Changes in:
        Receivables                                    (97.7)         (69.0)
        Inventories                                    (22.7)         (30.3)
        Other Current Assets                            (5.1)          (0.6)
        Accounts Payable and Accrued Liabilities      (107.6)         (55.4)
        Noncurrent Liabilities                          (7.4)           2.6
     Other Operating Activities                         14.4           (1.9)
     Net Cash and Cash Equivalents (Used for)
      Provided by Operating Activities of
      Continuing Operations                            (79.9)           7.2
     Discontinued Operations:
        Net Loss                                          --           (4.7)
        Change in Net Assets                              --            7.8
        Net Operating Activities                       (79.9)          10.3
     Investing Activities:
     Capital Expenditures                              (37.7)         (37.3)
     Disposition of Property, Plant and Equipment         --           24.5
     Business Acquired in Purchase Transaction          (2.0)            --
     Proceeds From Sale of Business                       --            5.5
     Taxes Paid on Sale of Businesses                 (116.4)            --
     Purchases of Short-term Investments               (79.4)            --
     Proceeds From Sale of Short-term Investments      107.9             --
     Investments and Advances - Affiliated
      Companies at Equity                              (43.8)          (4.7)
     Other Investing Activities                         (2.2)          (1.0)
        Net Investing Activities                      (173.6)         (13.0)
     Financing Activities:
     Long-Term Debt Repayments                        (138.5)         (18.2)
     Short-Term Debt Borrowings (Repayments)            (0.2)          32.1
     Purchase of Olin Common Stock                     (85.9)            --
     Repayment from ESOP                                 5.0           12.0
     Stock Options Exercised                             4.1            6.3
     Dividends Paid                                    (31.0)         (32.7)
     Other Financing Activities                         (1.5)           0.2
        Net Financing Activities                      (248.0)          (0.3)
     Net Decrease in Cash and Cash Equivalents        (501.5)          (3.0)
     Cash and Cash Equivalents, Beginning of Period    523.5            7.5
     Cash and Cash Equivalents, End of Period          $22.0           $4.5
 
     (a) Unaudited
     (b) The three months ended March 31, 1997 includes $112.4 of taxes paid in
         connection with the sale of the isocyanates businesses.
 
 

SOURCE Olin Corporation

More by this Source


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.