Fairlawn, OH, Sept.18—Omnova Solutions, which makes SBR latex for carpet backings, had earnings of $0.06 per diluted share for the third quarter of 2001, compared to earnings of $0.01 per diluted share during the same period last year.

"Our third quarter financial results exhibited improvement, both in sales and operating profit as compared to very weak first half results from our continuing operations. Demand in several of our markets improved slightly and raw material costs moderated," said Kevin McMullen, Omnova Solutions' chairman and CEO. "In a very challenging economic and operating environment, we continue to closely manage things under our control, especially expenses and capital expenditures. Restructuring actions taken earlier in the year are improving our profitability, and we were able to reduce our debt by $6.5 million in the quarter."

Sales were $199.9 million for the third quarter, essentially flat compared to $200.1 million during the same period a year ago, but the strongest quarterly total of the year. Excluding acquisition related revenues, sales for the current quarter were $189.8 million, down 5% versus last year’s third quarter. Operating profit totaled $10.2 million for the third quarter versus profit of $8.6 million for the same period last year. The third quarter operating profit improvement was a result of cost reductions, performance of recent acquisitions, and lower raw material costs.

As of August 31, Omnova's total debt was $196.5 million, a decrease of $6.5 million versus the second quarter of 2001. Corporate expense and net other income and expense declined $2.2 million during the quarter versus last year due to aggressive expense controls.

Performance Chemicals—Net sales during the third quarter decreased 8% to $83.7 million, versus $90.7 million in the third quarter last year. However, sales generated were the highest quarterly level of 2001. Operating profit totaled $8 million in the quarter as compared to operating profit of $1 million in the same period a year ago. Operating margins were 9.6% for the quarter versus 1.1% during the same period last year, with lower production volumes across most product lines offset by lower raw material costs, savings from cost reduction initiatives, and improved product mix. Raw material pricing for styrene and butadiene moderated versus the same period a year ago. Cost savings were generated by the workforce reduction taken in the second quarter and the Greensboro, North Carolina plant closure announced in the second quarter, which is expected to be completed by year end.

During the third quarter, Performance Chemicals introduced new products to the floor care, carpet, and specialties markets, including applications utilizing the company's proprietary PolyFox fluorochemical technology.  The business segment also continues to improve its cost structure for enhanced future financial performance.

Copyright 2001 Floor Focus Inc