AKRON, Ohio, May 28, 2013 /PRNewswire/ -- A. Schulman, Inc. (Nasdaq-GS: SHLM) today announced further restructuring plans in its Europe, Middle East and Africa (EMEA) region, due to the economic climate in Europe. As part of this restructuring, the EMEA regional team plans to reduce headcount. This further restructuring is expected to generate approximately $4 million in annual run rate savings.
"Given the ongoing poor economic environment in Europe, we felt it was necessary to continue our current restructuring efforts and expense reductions to better align with market demand," said Bernard Rzepka, Executive Vice President and Chief Operating Officer of A. Schulman. "Since 2010, we have executed a series of cost reduction programs in Europe. Over the past three years, these actions have provided more than $6 million in annual run rate savings, and the additional actions we are announcing today are expected to bring that total to approximately $10 million. While these actions are never easy, we continue to aggressively manage our operations to strengthen our strategic and financial position in the region. We do not expect any interruptions in service to customers resulting from these actions."
"We have confidence in the long-term strength of our EMEA business, and we continue to focus on growth opportunities in markets such as the Middle East, Turkey and Russia," said Joseph M. Gingo, Chairman, President and Chief Executive Officer. "Our overall strategy has always been to control what we can control and take quick action in response to market forces, as we continue to pursue further acquisitions and advance our position as a global specialty chemicals company."
Additionally, A. Schulman announced that it intends to sell its rotational compounding business in Brisbane, Australia. The Company will reflect the results of this business as discontinued operations in all future financial statements. The operating results for this business were previously included in the Company's Asia Pacific (APAC) segment. The Company plans to engage a financial advisor to assist in selling the business and expects to complete a sale within six to 12 months. This Australian business recorded revenue of approximately $25 million for fiscal 2012.
"This business has represented a very small portion of our portfolio, and we have been challenged to sustain profitability in the smaller Australian market despite the strategic restructuring programs we have implemented in recent years," Gingo said. "After careful consideration, we have committed to finding a suitable buyer for this business. This move will allow our APAC team to focus on our considerable opportunities in profitable growth markets and seek out further strategic acquisitions in the region, including Australia."
About A. Schulman, Inc.
A. Schulman, Inc. is a leading international supplier of high-performance plastic compounds and resins headquartered in Akron, Ohio. Since 1928, the Company has been providing innovative solutions to meet its customers' demanding requirements. The Company's customers span a wide range of markets such as packaging, mobility, building & construction, electronics & electrical, agriculture, personal care & hygiene, sports & leisure, custom services and others. The Company employs approximately 3,300 people and has 35 manufacturing facilities globally. A. Schulman reported net sales of $2.1 billion for the fiscal year ended August 31, 2012. Additional information about A. Schulman can be found at www.aschulman.com.
Cautionary Note on Forward-Looking Statements
A number of the matters discussed in this document that are not historical or current facts deal with potential future circumstances and developments and may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historic or current facts and relate to future events and expectations. Forward-looking statements contain such words as "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," and other words and terms of similar meaning in connection with any discussion of future operating or financial performance. Forward-looking statements are based on management's current expectations and include known and unknown risks, uncertainties and other factors, many of which management is unable to predict or control, that may cause actual results, performance or achievements to differ materially from those expressed or implied in the forward-looking statements. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements, and that could adversely affect the Company's future financial performance, include, but are not limited to, the following:
- worldwide and regional economic, business and political conditions, including continuing economic uncertainties in some or all of the Company's major product markets or countries where the Company has operations;
- the effectiveness of the Company's efforts to improve operating margins through sales growth, price increases, productivity gains, and improved purchasing techniques;
- competitive factors, including intense price competition;
- fluctuations in the value of currencies in major areas where the Company operates;
- volatility of prices and availability of the supply of energy and raw materials that are critical to the manufacture of the Company's products, particularly plastic resins derived from oil and natural gas;
- changes in customer demand and requirements;
- effectiveness of the Company to achieve the level of cost savings, productivity improvements, growth and other benefits anticipated from acquisitions, joint ventures and restructuring initiatives, including any proposed combination with Ferro Corporation;
- escalation in the cost of providing employee health care;
- uncertainties regarding the resolution of pending and future litigation and other claims;
- the performance of the global automotive market; and
- further adverse changes in economic or industry conditions, including global supply and demand conditions and prices for products.
The risks and uncertainties identified above are not the only risks the Company faces. Additional risk factors that could affect the Company's performance are set forth in the Company's Annual Report on Form 10-K for the fiscal year ended August 31, 2012. In addition, risks and uncertainties not presently known to the Company or that it believes to be immaterial also may adversely affect the Company. Should any known or unknown risks or uncertainties develop into actual events, or underlying assumptions prove inaccurate, these developments could have material adverse effects on the Company's business, financial condition and results of operations.
SOURCE A. Schulman, Inc.