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0000950152-03-000851.txt : 20030131
0000950152-03-000851.hdr.sgml : 20030131
20030131130421
ACCESSION NUMBER: 0000950152-03-000851
CONFORMED SUBMISSION TYPE: 8-K
PUBLIC DOCUMENT COUNT: 3
CONFORMED PERIOD OF REPORT: 20030130
ITEM INFORMATION: Other events
ITEM INFORMATION: Financial statements and exhibits
FILED AS OF DATE: 20030131
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: POLYONE CORP
CENTRAL INDEX KEY: 0001122976
STANDARD INDUSTRIAL CLASSIFICATION: PLASTICS, MATERIALS, SYNTH RESINS & NONVULCAN ELASTOMERS [2821]
IRS NUMBER: 341730488
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K
SEC ACT: 1934 Act
SEC FILE NUMBER: 001-16091
FILM NUMBER: 03533999
BUSINESS ADDRESS:
STREET 1: SUITE 36-500
STREET 2: 200 PUBLIC SQUARE
CITY: CLEVELAND
STATE: OH
ZIP: 441142304
BUSINESS PHONE: 2165894000
MAIL ADDRESS:
STREET 1: ONE GEON CENTER
STREET 2: ONE GEON CENTER
CITY: AVON LAKE
STATE: OH
ZIP: 44012
8-K
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l98503ae8vk.htm
POLYONE CORPORATION FORM 8-K
PolyOne Corporation Form 8-K
SECURITIES AND EXCHANGE COMMISSION
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): January 30, 2003
POLYONE CORPORATION
(Exact name of registrant as specified in charter)
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Ohio |
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1-16091
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34-1730488 |
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(State or other
jurisdiction of
incorporation) |
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(Commission
File Number)
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(I.R.S.
Employer
Identification
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Suite 36-5000, 200 Public Square, Cleveland, Ohio |
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44114-2304 |
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(Address of principal executive offices) |
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(Zip Code) |
Registrants telephone number, including area code: (216) 589-4000
Not Applicable
(Former name or former address, if changed since last report.)
Item 5 Other Events
On January 30, 2003 the Registrant issued a Press Release, filed herewith as
Exhibit 99.1, reporting earnings for the 2002 fourth quarter and full year.
Item 7 (c) Financial Statements, Pro-Forma Financial Information and Exhibits
Exhibit 99.1 - Press Release of January 30, 2003.
SIGNATURE
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.
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POLYONE CORPORATION
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By: |
/s/ Gregory P. Smith
Gregory P. Smith
Controller |
Dated: January 31, 2003
EX-99.1
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l98503aexv99w1.txt
EXHIBIT 99.1 NEWS RELEASE
EXHIBIT 99.1
[POLYONE LOGO]
NEWS RELEASE
FOR IMMEDIATE RELEASE
POLYONE REPORTS 2002 FOURTH-QUARTER, FULL-YEAR RESULTS
- Fourth-quarter earnings are slightly better than anticipated in
December
- European and Asian operations finish 2002 up strongly from 2001
- Company anticipates sequential sales growth and improved earnings
before special charges in first-quarter 2003
CLEVELAND - January 30, 2003 - PolyOne Corporation (NYSE: POL), a leading global
polymer services company, reported sales today of $580.3 million and a net loss
of $17.5 million, or $0.19 per share, for the fourth quarter ended December 31,
2002. For the full year, the Company had sales of $2.5 billion and a net loss of
$58.9 million, or $0.65 per share, which included a write-off of goodwill of
$53.7 million, or $0.59 per share, in connection with a change in an accounting
method.
Net income for fourth-quarter 2002 included special charges relating to costs of
previously announced restructuring initiatives, impairment of an equity
investment and an impairment of a marketable security. These charges reduced net
income by $3.1 million, or $0.03 per share. For the full year, special charges
reduced net income by $9.3 million, or $0.10 per share. A summary of special
charges incurred during 2002 is attached.
"As expected, customer demand in the fourth quarter slowed considerably,
especially in North America," said Thomas A. Waltermire, PolyOne chairman and
chief executive officer. "While the fourth quarter historically reflects the
lowest seasonal demand period, we have seen indications of substantial inventory
reduction by our customers, a reflection of continuing economic uncertainty.
"This lingering uncertainty and an apparent increase in energy costs have
continued to negatively impact the industry. In this environment, it is
essential that we improve our competitive cost position," added Waltermire. "I
am confident that the significant improvements we have made in the past two
years, coupled with the actions we announced in December and January, should
help both our financial performance and our drive for growth going forward."
On December 17, 2002, PolyOne announced that it had initiated a thorough
assessment of its businesses, its overall cost structure, the effectiveness of
its approach to customers and its debt level. As a result of this work, the
Company announced a series of actions designed to contribute to PolyOne's
profitability in 2003:
- - On January 14, 2003, management outlined its plans to reduce its
selling and administrative (S&A) costs to less than 10 percent of
sales. In 2002, S&A costs as reported in the consolidated income
statement were approximately 12 percent of sales.
- - The Company has targeted a reduction of $200 million to $300 million in
its overall debt level. This goal complements management's process of
assessing alternatives for non-strategic assets.
- - Effective with the first quarter of 2003, PolyOne will suspend payment
of its quarterly dividend until its earnings and operating performance
improve. In 2002, PolyOne paid a $0.0625 per share (approximately $6
million) quarterly dividend.
- - The Company expects to limit capital spending to approximately $50
million in 2003.
FOURTH-QUARTER 2002 RESULTS(*)
(Dollars in millions, except per share data)
4Q02 3Q02 4Q01
-------- -------- --------
Sales $ 580.3 $ 650.7 $ 573.2
Operating income (loss) (13.4) 26.3 (35.9)
Operating income (loss) before special items** (9.1) 31.6 3.2
Net income (loss) $ (17.5) $ 9.8 $ (30.1)
Income (loss) before discontinued operations
and special items** (14.5) 13.0 (5.5)
Income (loss) per share, diluted $ (0.19) $ 0.11 $ (0.33)
Income (loss) per share before discontinued operations (0.19) 0.11 (0.33)
Per share effect of excluding special items**, increase 0.03 0.03 0.27
Per share effect of goodwill amortization expense
on net income 0.00 0.00 0.04
FULL-YEAR 2002 RESULTS(*)
(Dollars in millions, except per share data)
2002 2001
---------- ----------
Sales $ 2,498.2 $ 2,581.1
Operating income (loss) 38.9 (29.5)
Operating income before special items** 52.9 31.6
Net loss $ (58.9) $ (46.1)
Loss before discontinued operations and
cumulative effect of a change in accounting (6.6) (47.1)
Income (loss) before discontinued operations,
cumulative effect of a change in accounting
and special items** 2.7 (11.2)
Loss per share, diluted $ (0.65) $ (0.51)
Loss per share before discontinued operations and
cumulative effect of a change in accounting, diluted (0.07) (0.52)
Per share effect of excluding special items**, increase 0.10 0.40
Per share effect of goodwill amortization expense
on net income 0.00 0.16
* 2002 and 2001 results of So.F.teR S.p.A. have been reported separately to
reflect the December 2002 sale of that business as a discontinued operation.
** A summary of special items for 2002 and 2001 can be found in the attached
table.
2
FOURTH-QUARTER 2002 BUSINESS HIGHLIGHTS
- - PolyOne's international operations continued to grow sales from 2001
levels. Compared with the 2001 fourth quarter and full year, sales
volume in pounds increased 12 percent and 7 percent, respectively.
Asian sales were particularly strong, increasing to $74.8 million in
2002 compared with $48.2 million in 2001.
- - The Distribution segment demonstrated solid improvement over year-ago
levels, with fourth-quarter and full-year 2002 revenues up 16 percent
and 12 percent, respectively, over the comparable 2001 periods. The
majority of this improvement resulted from the addition of PolyOne's
Geon-brand vinyl compounds to the Distribution business.
- - In PolyOne's Resin and Intermediates (R&I) segment, equity operating
income before special items increased $4.6 million in fourth-quarter
2002 compared with fourth-quarter 2001. Most of the increase resulted
from higher chlor-alkali selling prices and higher margins between
polyvinyl chloride (PVC) industry selling prices and raw material
costs. For the full year, equity income before special charges
increased $23.2 million in 2002 compared with 2001. Most of the
year-over-year improvement is attributable to higher PVC margins from
the Oxy Vinyls, LP resin joint venture.
- - PolyOne continues to make progress toward its objective of realizing
$200 million in annual income improvements in 2003 compared with the
base year 2000. In the fourth quarter of 2002, PolyOne realized
approximately $2 million of additional benefit from its value capture
initiatives, for an annualized rate of approximately $150 million.
- - In January 2003, PolyOne announced that it would reduce its overall
cost structure by eliminating approximately 400 salaried positions,
primarily in administrative functions. PolyOne projects that this
reduction will lower S&A costs, as classified on its income statement,
between approximately $30 million and $35 million pre tax annually,
effective with the second quarter of 2003. In addition, PolyOne will
reduce its non-personnel costs by approximately $5 million to $10
million pre tax. PolyOne expects nearly all staff reductions to occur
in the first quarter of 2003, and will recognize a restructuring charge
of approximately $22 million pre tax.
- - PolyOne's capital expenditures were approximately $26 million in the
fourth quarter of 2002. For the year, capital expenditures totaled
approximately $75.1 million, excluding approximately $3.8 million spent
on the So.F.teR S.p.A. joint venture. During the fourth quarter,
PolyOne completed the sale of its 70 percent majority interest in
So.F.teR S.p.A., an Italian compounder of thermoplastic materials,
while licensing certain key technologies.
3
- Most fourth-quarter capital spending funded the continuing
expansion and modernization of the North American Plastic
Compounds and Colors (PCC) unit's manufacturing base. Five PCC
plants were closed in the fourth quarter. Two additional plants
will cease production when PolyOne completes the upgrade by
mid-2003. The Company projects that this initiative will increase
2003 operating income by approximately $25 million.
- PolyOne completed the acquisition of Transformacion de Pigmentos y
Colorantes, S.A. (TRANSCOLOR), a large color concentrates producer
operating near Pamplona in northern Spain. TRANSCOLOR has annual
revenues of approximately $36 million (USD).
- Also in the fourth quarter, PolyOne reached an agreement to sell
to TPM Holdings, LP its majority interest in the joint venture
company Techmer PM, LLC. PolyOne expects the sale of its 51
percent position to occur in the first quarter of 2003. TPM
Holdings owns the remaining 49 percent of Techmer PM, LLC.
- PolyOne and Nanocor Inc., the largest supplier of nanoclays for
plastics, formed a strategic alliance to manufacture and market
nanocomposites made from polyolefin, PVC and related polymers.
PolyOne will manage all aspects of the manufacture, marketing and
sale of nanoclay concentrates and composites, using Nanocor's
products and technology and assistance from Nanocor's sales
personnel.
BUSINESS OUTLOOK
PolyOne management estimates that first-quarter 2003 earnings, while showing a
marked improvement from the loss in the fourth quarter, will be a loss in the
range of $0.03 to $0.07 per share. The key variable is whether the January
increase in sales is sustainable through the balance of the quarter in light of
current economic uncertainties. Despite these uncertainties, the Company
projects that first-quarter 2003 sales will rebound from fourth-quarter 2002
levels and exceed sales in first-quarter 2002. PolyOne forecasts higher equity
operating income from its Resin and Intermediates segment, due primarily to
improved customer demand.
The following table summarizes PolyOne's projection of the primary earnings
drivers anticipated to impact operating income before special items in
first-quarter 2003 versus the fourth quarter of 2002. Also included is the
projected annual impact of key initiatives. While the leverage on earnings from
changes in sales levels varies by product, PolyOne generally anticipates a
variable-margin impact on earnings ranging from 25 percent to 30 percent of the
sales change.
4
INCREMENTAL CHANGE
INCOME (EXPENSE)-
$ IN MILLIONS
-------------
1Q03 Yr03
---- ----
HIGH-LEVERAGE VARIABLES
- PVC resin pricing
1Q03 (+1 - 2 cents per lb.) $ 2-3
- Ethylene costs
1Q03 (+1 - 1.5 cents per lb.) $ (2-3)
- Chlorine costs
1Q03 (+$0 per ton) --
- Caustic soda selling price
1Q03 (+$20 - 30 per ton) $ 1-2
-- Natural gas costs
1Q03 (+$0.50 - 0.90 per million BTU) $ (1-2)
VALUE CAPTURE INITIATIVES $ 50-70
REDUCTION IN SELLING AND ADMINISTRATIVE COSTS $ 32-37
2003 ESTIMATED PROGRAM COST INCREASES $ (25-30)
High-leverage variables comprise the key commodities and their estimated
leverage on PolyOne earnings from changing prices/costs. The projections
represent industry forecasts, with allowance for actual price change
realization. PVC pricing consists of the combined impact of PVC resin industry
selling prices and estimated resulting impact on PVC compound costs.
Value capture initiatives represent the remaining benefit projected to increase
2003 earnings as a result of the initiatives launched upon PolyOne's formation.
The 2003 earnings benefit is expected to come primarily from the completion of
the North American manufacturing consolidation and modernization, the
acquisition of TRANSCOLOR, 2002 investments in international operations, and
lower sourcing and logistics costs.
Program cost increases relate to employment compensation and benefit costs,
primarily (1) pension expense due to a lower liability discount rate and poor
pension asset performance and (2) the rising cost of medical benefits.
CONFERENCE CALL
PolyOne will host an analyst conference call at 10 a.m. Eastern time on Friday,
January 31, 2003. The conference call number is 888-489-0038 or 706-643-1611
(international), conference topic: PolyOne Earnings Call. The call will be
broadcast live and then via replay for two weeks on the Company's Web site:
www.polyone.com.
5
UPCOMING INVESTOR MEETING
PolyOne will host an investor meeting on Tuesday, February 11, 2003, at The
Sheraton New York Hotel and Towers, 811 Seventh Avenue at 53rd Street.
Presenting will be Thomas A. Waltermire, chairman and chief executive officer;
W. David Wilson, chief financial officer; and V. Lance Mitchell, vice president,
global plastics. Information on this meeting can be obtained be contacting
Darlene Hampton at 216-589-4376 or darlene.hampton@polyone.com. The meeting will
be broadcast live and then via replay for two weeks on the Company's Web site:
www.polyone.com.
SUPPLEMENTAL INFORMATION
Investors interested in more detailed information on PolyOne's results or the
performance of its business segments, please see the Supplemental Information
report issued today. The report is posted in the Investor Relations section of
the Company's Web site: www.polyone.com. It can also be obtained from the
contact listed at the end of this release.
ABOUT POLYONE
PolyOne Corporation, with 2002 revenues of $2.5 billion, is an international
polymer services company with operations in thermoplastic compounds, specialty
resins, specialty polymer formulations, engineered films, color and additive
systems, elastomer compounding and thermoplastic resin distribution.
Headquartered in Cleveland, Ohio, PolyOne has employees at manufacturing sites
in North America, Europe, Asia and Australia, and joint ventures in North
America, South America, Europe, Asia and Australia. Information on the Company's
products and services can be found at www.polyone.com.
PolyOne Media & Investor Contact: Dennis Cocco
Chief Investor & Communications Officer
216.589.4018
FORWARD-LOOKING STATEMENTS
In this release, statements that are not reported financial results or other
historical information are "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Forward-looking statements
give current expectations or forecasts of future events and are not guarantees
of future performance. They are based on management's expectations that involve
a number of business risks and uncertainties, any of which could cause actual
results to differ materially from those expressed in or implied by the
forward-looking statements. You can identify these statements by the fact that
they do not relate strictly to historic or current facts. They use words such 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. In particular, these include
statements relating to future actions; prospective changes in raw material
costs, product pricing or product demand; future performance or results of
current and anticipated market conditions and market strategies; sales efforts;
expenses; the outcome of contingencies such as legal proceedings; and financial
results. Factors that could cause actual results to differ materially include,
but are not limited to: (1) an inability to achieve or delays in achieving
estimated and actual savings related to restructuring programs; (2) delays in
achieving or inability to achieve the Company's strategic value capture
initiatives, including cost reduction and employee productivity goals, or
achievement of less than the anticipated financial benefit from the initiatives;
(3) the effect on foreign operations of currency fluctuations, tariffs,
nationalization, exchange controls, limitations on foreign investment in local
businesses and other political, economic and regulatory risks; (4) changes in
U.S., regional or world polymer and/or rubber consumption growth rates affecting
the Company's markets; (5) changes in global industry capacity or in the rate at
which anticipated changes in industry capacity come online in the polyvinyl
chloride (PVC), chlor-alkali, vinyl chloride monomer (VCM) or other industries
in which the Company participates; (6) fluctuations in raw material prices,
quality and supply and in energy prices and supply, in particular fluctuations
outside the normal range of industry cycles; (7) production outages or material
costs associated with scheduled or unscheduled maintenance programs; (8) costs
or difficulties and delays related to the operation of joint venture entities;
(9) lack of day-to-day operating control, including procurement of raw
materials, of equity or joint venture affiliates; (10) partial control over
investment decisions and dividend distribution policy of the OxyVinyls
partnership and other minority equity holdings of the Company; (11) an inability
to launch new products and/or services that strategically fit the Company's
businesses; (12) the possibility of goodwill impairment; (13) an inability to
maintain any required licenses or permits; (14) an inability to comply with any
environmental laws and regulations; and (15) a delay or inability to achieve
divestitures necessary to achieve targeted debt levels.
We cannot guarantee that any forward-looking statement will be realized,
although we believe we have been prudent in our plans and assumptions.
Achievement of future results is subject to risks, uncertainties and inaccurate
assumptions. Should known or unknown risks or uncertainties materialize, or
should underlying assumptions prove inaccurate, actual results could vary
materially from those anticipated, estimated or projected. Investors should bear
this in mind as they consider forward-looking statements.
We undertake no obligation to publicly update forward-looking statements,
whether as a result of new information, future events or otherwise. You are
advised, however, to consult any further disclosures we make on related subjects
in our Form 10-Q, 8-K and 10-K reports to the Securities and Exchange
Commission. You should understand that it is not possible to predict or identify
all such factors. Consequently, you should not consider any such list to be a
complete set of all potential risks or uncertainties. (Ref. #103)
6
SUMMARY OF SPECIAL ITEMS
(In millions)
Quarters
----------------------------------------
4Q02 3Q02 4Q01
------- ------- --------
Employee separation and plant phase-out costs $ - $ (0.2) $ (26.3)
Period plant phase-out costs incurred (0.4) (0.5) -
Plant phase-out accelerated depreciation (0.3) (0.5) -
Equity affiliate - employee severance, liabilities
associated with the temporary idling of a plant
and facility asset write-off and decommissioning costs - (4.1) (3.3)
Loss on divestiture of equity investment (3.6) - (9.5)
------- ------- --------
Subtotal - operating (expense) (4.3) (5.3) (39.1)
Investment write-down (0.8) - -
------- ------- --------
Total - pre-tax (expense) (5.1) (5.3) (39.1)
Income tax benefit 2.0 1.9 14.5
------- ------- --------
Total - after-tax (expense) $ (3.1) $ (3.4) $ (24.6)
======= ======= ========
Year
-------------------------
2002 2001
-------- ---------
Employee separation and plant phase-out cost $ (1.1) $ (36.1)
Period plant phase-out costs incurred (1.1) (0.2)
Plant phase-out accelerated depreciation (1.8) -
Equity affiliate - employee severance, liabilities
associated with the temporary idling of a plant
and facility asset write-off and decommissioning costs (4.9) (9.4)
Merger and integration costs - (5.9)
Loss on divestiture of equity investment (5.1) (9.5)
-------- ---------
Subtotal - operating (expense) (14.0) (61.1)
Investment write-down (0.8) (0.6)
Litigation settlement gain - 4.1
-------- ---------
Total - pre-tax (expense) (14.8) (57.6)
Income tax benefit 5.5 21.7
-------- ---------
Total - after-tax (expense) $ (9.3) $ (35.9)
======== =========
POLYONE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(IN MILLIONS, EXCEPT PER SHARE DATA)
Three Months Ended Year Ended
December 31, December 31,
----------------------- ----------------------
2002 2001 2002 2001
-------- -------- --------- ---------
Sales $ 580.3 $ 573.2 $ 2,498.2 $ 2,581.1
Operating costs and expenses:
Cost of sales 500.2 482.8 2,098.2 2,162.4
Selling and administrative 78.6 69.6 302.6 297.7
Depreciation and amortization 17.9 18.0 72.5 89.2
Employee separation and plant phase-out - 26.3 1.1 36.1
Merger and integration costs - - - 5.9
Loss on divestiture of equity investment 3.6 9.5 5.1 9.5
(Income) loss from equity affiliates and minority interest (6.6) 2.9 (20.2) 9.8
-------- -------- --------- ---------
Operating income (loss) (13.4) (35.9) 38.9 (29.5)
Interest expense (11.0) (8.9) (42.4) (40.7)
Interest income 0.3 0.3 0.9 2.3
Other expense, net (5.3) (2.1) (9.2) (6.3)
-------- -------- --------- ---------
Income (loss) before income taxes, discontinued operations, and
cumulative effect of change in accounting method (29.4) (46.6) (11.8) (74.2)
Income tax benefit 11.8 16.5 5.2 27.1
-------- -------- --------- ---------
Income (loss) before discontinued operations and
cumulative effect of a change in accounting (17.6) (30.1) (6.6) (47.1)
Discontinued operations:
Income from operations and loss on sale (net of income taxes) 0.1 0.0 1.4 1.0
Cumulative effect of a change in goodwill accounting,
net of income tax benefit of $1.0 million - - (53.7) -
-------- -------- --------- ---------
Net loss $ (17.5) $ (30.1) $ (58.9) $ (46.1)
======== ======== ========= =========
Income (loss) per Share of Common Stock:
Basic income (loss) per share before discontinued operations
and effect of change in accounting $ (.19) $ (.33) $ (.07) $ (.52)
Discontinued operations - - .01 .01
Cumulative effect of a change in accounting - - (.59) -
-------- -------- --------- ---------
Basic income (loss) per share $ (.19) $ (.33) $ (.65) $ (.51)
======== ======== ========= =========
Diluted income (loss) per share before discontinued operations
and effect of change in accounting $ (.19) $ (.33) $ (.07) $ (.52)
Discontinued operations - - .01 .01
Cumulative effect of a change in accounting - - (.59) -
-------- -------- --------- ---------
Diluted income (loss) per share $ (.19) $ (.33) $ (.65) $ (.51)
======== ======== ========= =========
Weighted average shares used to compute loss per share:
Basic 90.8 90.0 90.8 89.8
Diluted 90.8 90.0 90.8 89.9
Dividends paid per share of common stock $ .0625 $ .0625 $ .25 $ .25
POLYONE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
(IN MILLIONS)
December 31, December 31,
2002 2001
------------- -------------
ASSETS
Current assets:
Cash and cash equivalents $ 41.4 $ 18.2
Accounts receivable, net 164.3 135.6
Other receivables 5.4 11.4
Inventories 253.7 255.3
Deferred taxes 42.1 40.2
Other current assets 7.3 16.5
---------- ----------
Total current assets 514.2 477.2
Property, net 682.1 683.6
Investment in equity affiliates 271.8 287.9
Goodwill, net 444.0 476.3
Other intangible assets, net 32.8 61.0
Other non-current assets 52.6 65.5
---------- ----------
Total assets $ 1,997.5 $ 2,051.5
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term bank debt $ 0.7 $ 14.7
Accounts payable 242.0 311.4
Accrued expenses 160.2 161.0
Current portion of long-term debt 91.0 4.6
---------- ----------
Total current liabilities 493.9 491.7
Long-term debt 492.2 426.8
Deferred taxes 39.0 63.2
Post-retirement benefits other than pensions 122.5 126.2
Other non-current liabilities, including pensions 261.2 214.5
Minority interest in consolidated subsidiaries 9.0 15.7
---------- ----------
Total liabilities 1,417.8 1,338.1
Shareholders' equity:
Preferred stock - -
Common stock 1.2 1.2
Other shareholders' equity 578.5 712.2
---------- ----------
Total shareholders' equity 579.7 713.4
---------- ----------
Total liabilities and shareholders' equity $ 1,997.5 $ 2,051.5
========== ==========
POLYONE CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(IN MILLIONS)
Three Months Ended Year Ended
December 31, December 31,
--------------------------- ---------------------------
2002 2001 2002 2001
--------- --------- --------- ---------
OPERATING ACTIVITIES
Net income (loss) $ (17.5) $ (30.1) $ (58.9) $ (46.1)
Income (loss) from discontinued operations 0.1 - 1.4 1.0
--------- --------- --------- ---------
Loss from continuing operations (17.6) (30.1) (60.3) (47.1)
Adjustments to reconcile net loss to net
cash provided (used) by operating activities:
Employee separation and plant phase-out charges - 26.3 1.1 36.1
Cash payments on employee separation and plant phase-out (4.9) (4.7) (17.0) (23.8)
Cumulative effect of a change in accounting - - 53.7 -
Depreciation and amortization 17.9 18.0 72.5 89.2
Unrealized currency gains (2.2) (0.8) (13.0) (0.8)
Investment write-down and loss on sale of equity affiliate 3.6 9.5 5.1 9.5
Companies carried at equity and minority interest:
(Income) loss (7.4) 3.1 (19.7) 11.2
Dividends received 2.6 1.7 4.7 3.7
Change in assets and liabilities:
Operating working capital:
Accounts receivable 33.7 52.7 (38.6) 188.8
Inventories 33.7 25.3 0.8 76.7
Accounts payable (44.4) (30.5) (64.5) 1.4
Accrued expenses and other (2.6) (17.8) 8.6 (41.9)
--------- --------- --------- ---------
NET CASH PROVIDED (USED) BY CONTINUING OPERATIONS 12.4 52.7 (66.6) 303.0
--------- --------- --------- ---------
INVESTING ACTIVITIES
Capital expenditures (26.0) (32.3) (75.1) (78.1)
Cash received from equity affiliates 10.9 (0.4) 27.1 1.7
Business acquired, net of cash received (11.4) - (11.4) -
Proceeds from sale of assets 12.8 1.6 14.7 4.4
--------- --------- --------- ---------
NET CASH PROVIDED (USED) BY CONTINUING OPERATIONS (13.7) (31.1) (44.7) (72.0)
--------- --------- --------- ---------
FINANCING ACTIVITIES
Change in short-term debt 89.0 (30.4) 83.2 (230.2)
Change in long-term debt (93.3) 0.1 60.6 (0.9)
Termination of interest rate swap agreements - - 8.3 4.3
Repurchase of common stock - - - -
Proceeds from the exercise of stock options - - 7.0 -
Dividends (5.8) (5.9) (22.7) (22.9)
--------- --------- --------- ---------
NET CASH PROVIDED (USED) BY CONTINUING OPERATIONS (10.1) (36.2) 136.4 (249.7)
--------- --------- --------- ---------
NET CASH PROVIDED (USED) BY DISCONTINUED OPERATIONS - 0.0 1.4 (0.1)
Effect of exchange rate changes on cash (0.6) (0.4) (3.3) (0.9)
--------- --------- --------- ---------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (12.0) (15.0) 23.2 (19.7)
Cash and cash equivalents at beginning of period 53.4 33.2 18.2 37.9
--------- --------- --------- ---------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 41.4 $ 18.2 $ 41.4 $ 18.2
========= ========= ========= =========
8-K
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l98503ae8vkxpdfy.pdf
COURTESY COPY OF FORM 8-K
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