10-Q 1 form_10-q.txt FORM 10-Q -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ (Mark One) /X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000 OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER 1-9753 ------------------------ GEORGIA GULF CORPORATION (Exact name of registrant as specified in its charter) DELAWARE 58-1563799 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 400 PERIMETER CENTER TERRACE, 30346 SUITE 595, ATLANTA, GEORGIA (Zip code) (Address of principal executive offices)
------------------------ Registrant's telephone number, including area code: (770) 395-4500 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes /X/ No / / Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.
OUTSTANDING AS OF CLASS AUGUST 9, 2000 ----- ----------------- Common Stock, $0.01 par value............................. 31,486,727 shares
-------------------------------------------------------------------------------- -------------------------------------------------------------------------------- GEORGIA GULF CORPORATION FORM 10-Q QUARTERLY PERIOD ENDED JUNE 30, 2000 INDEX
PAGE NUMBERS ------- PART I. FINANCIAL INFORMATION Item 1. Financial Statements Condensed Consolidated Balance Sheets as of June 30, 1 2000 and December 31, 1999................................. Condensed Consolidated Statements of Income for the 2 Three and Six Months Ended June 30, 2000 and 1999..... Condensed Consolidated Statements of Cash Flows for the 3 Six Months Ended June 30, 2000 and 1999............... Notes to Condensed Consolidated Financial Statements as 4-12 of June 30, 2000...................................... Item 2. Management's Discussion and Analysis of Financial 13-17 Condition and Results of Operations..................... Item 3. Quantitative and Qualitative Disclosures About 17 Market Risk............................................. PART II. OTHER INFORMATION Item 1. Legal Proceedings................................. 18 Item 4. Submission of Matters to a Vote of Security 18 Holders................................................. Item 6. Exhibits and Reports on Form 8-K.................. 18 SIGNATURES.................................................. 19
PART I. FINANCIAL INFORMATION. ITEM 1. FINANCIAL STATEMENTS. GEORGIA GULF CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT SHARE DATA)
JUNE 30, DECEMBER 31, 2000 1999 ----------- ------------ ASSETS Cash and cash equivalents................................... $ 1,038 $ 4,424 Receivables................................................. 153,338 164,376 Inventories................................................. 145,484 112,844 Prepaid expenses............................................ 5,449 5,440 Deferred income taxes....................................... 6,172 6,172 ----------- ----------- Total current assets...................................... 311,481 293,256 ----------- ----------- Property, plant and equipment, at cost...................... 995,783 985,825 Less accumulated depreciation............................. 347,163 314,275 ----------- ----------- Property, plant and equipment, net...................... 648,620 671,550 ----------- ----------- Goodwill.................................................... 81,437 82,676 Other assets................................................ 49,934 50,083 Net assets of discontinued operation........................ -- 443 ----------- ----------- Total assets................................................ $ 1,091,472 $ 1,098,008 =========== =========== LIABILITIES AND STOCKHOLDERS' EQUITY Current portion of long-term debt........................... $ 15,021 $ 22,000 Accounts payable............................................ 162,797 143,898 Interest payable............................................ 5,210 5,926 Accrued income taxes........................................ 905 494 Accrued compensation........................................ 10,585 7,682 Other accrued liabilities................................... 11,187 17,632 ----------- ----------- Total current liabilities................................. 205,705 197,632 ----------- ----------- Long-term debt, net of current portion...................... 664,316 749,194 ----------- ----------- Deferred income taxes....................................... 102,479 93,949 ----------- ----------- Stockholders' equity Common stock--$0.01 par value............................. 315 313 Additional paid-in capital................................ 7,815 5,250 Retained earnings......................................... 110,842 51,670 ----------- ----------- Total stockholders' equity.............................. 118,972 57,233 ----------- ----------- Total liabilities and stockholders' equity.................. $ 1,091,472 $ 1,098,088 =========== =========== Common shares outstanding................................... 31,485,060 31,290,862 =========== ===========
See notes to condensed consolidated financial statements. 1 GEORGIA GULF CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (IN THOUSANDS, EXCEPT SHARE DATA)
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, ------------------------- ------------------------- 2000 1999 2000 1999 ----------- ----------- ----------- ----------- Net sales................................. $ 413,406 $ 180,713 $ 817,077 $ 359,977 ----------- ----------- ----------- ----------- Operating costs and expenses Cost of sales........................... 332,924 156,129 654,780 311,820 Selling and administrative.............. 11,358 9,625 25,032 19,919 ----------- ----------- ----------- ----------- Total operating costs and expenses.... 344,282 165,754 679,812 331,739 ----------- ----------- ----------- ----------- Operating income.......................... 69,124 14,959 137,265 28,238 Other expense Interest, net........................... 17,952 7,359 36,960 14,682 ----------- ----------- ----------- ----------- Income from continuing operations before income taxes............................ 51,172 7,600 100,305 13,556 Provision for income taxes................ 18,421 2,773 36,116 4,947 ----------- ----------- ----------- ----------- Income from continuing operations......... 32,751 4,827 64,189 8,609 Discontinued operation Loss from discontinued operation, net... -- (757) -- (2,005) ----------- ----------- ----------- ----------- Net income................................ $ 32,751 $ 4,070 $ 64,189 $ 6,604 =========== =========== =========== =========== Earnings / (loss) per share: Basic Continuing operations................. $ 1.04 $ 0.15 $ 2.05 $ 0.27 Discontinued operation................ -- (0.02) -- (0.06) ----------- ----------- ----------- ----------- $ 1.04 $ 0.13 $ 2.05 $ 0.21 =========== =========== =========== =========== Weighted average common shares-basic.... 31,364,961 30,922,192 31,333,119 30,910,525 =========== =========== =========== =========== Diluted Continuing operations................. $ 1.04 $ 0.15 $ 2.03 $ 0.27 Discontinued operation................ -- (0.02) -- (0.06) ----------- ----------- ----------- ----------- $ 1.04 $ 0.13 $ 2.03 $ 0.21 =========== =========== =========== =========== Weighted average common shares-diluted........................ 31,577,500 31,032,475 31,558,983 31,032,917 =========== =========== =========== ===========
See notes to condensed consolidated financial statements. 2 GEORGIA GULF CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (IN THOUSANDS)
SIX MONTHS ENDED JUNE 30, ------------------------ 2000 1999 --------- -------- Cash flows from operating activities: Net income................................................ $ 64,189 $ 6,604 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization........................... 37,535 22,527 Loss from discontinued operation, net................... -- 2,005 Change in operating assets, liabilities and other....... (484) (13,994) --------- -------- Net cash provided by continuing operations................ 101,240 17,142 Net cash provided by discontinued operation............... 443 3,622 --------- -------- Net cash provided by operating activities................. 101,683 20,764 --------- -------- Cash flows from financing activities: Long-term debt proceeds................................. 33,819 115,000 Long-term debt payments................................. (125,675) (124,550) Proceeds from issuance of common stock.................. 1,762 359 Dividends paid.......................................... (5,017) (4,946) --------- -------- Net cash used in financing activities..................... (95,111) (14,137) --------- -------- Cash flows from investing activities: Capital expenditures.................................... (9,958) (7,119) --------- -------- Net change in cash and cash equivalents................... (3,386) (492) Cash and cash equivalents at beginning of period.......... 4,424 1,244 --------- -------- Cash and cash equivalents at end of period................ $ 1,038 $ 752 ========= ========
See notes to condensed consolidated financial statements. 3 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS NOTE 1: BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. For further information, refer to our consolidated financial statements and footnotes thereto included in our Annual Report on Form 10-K for the year ended December 31, 1999. Our operating results for the three- and six-month periods ended June 30, 2000 are not necessarily indicative of the results that may be expected for the year ending December 31, 2000. NOTE 2: NEW ACCOUNTING PRONOUNCEMENT During June 1998, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and Hedging Activities." The statement establishes accounting and reporting standards requiring that every derivative instrument be recorded in the balance sheet as either an asset or liability measured at its fair value and that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met. Special accounting for qualifying hedges allows derivative gains and losses to offset related results on the hedged item in the income statement, and requires that a company must formally document, designate and assess the effectiveness of transactions that receive hedge accounting. As amended, SFAS No. 133 is effective for fiscal quarters of all fiscal years beginning after June 15, 2000, although earlier adoption is permitted. SFAS No. 133 cannot be applied retroactively. We have not yet quantified the impact of adopting SFAS No. 133 on our financial statements. NOTE 3: ACQUISITION On November 12, 1999, we completed the acquisition of the assets of the vinyls business of CONDEA Vista Company. The purchase included substantially all of the assets and net working capital of the vinyls business as of the date of acquisition. The acquisition was accounted for as a purchase, and the results of the vinyls business's operations have been included in our consolidated financial statements from the date of acquisition. The initial purchase price, including related fees and expenses, consisted of $263,000,000 of cash and the issuance of a $10,000,000 two-year, non-interest-bearing note payable to CONDEA Vista Company. The note was recorded at its net present value of $7,750,000 at the date of acquisition. The initial purchase price was subject to an adjustment for actual working capital acquired. During the second quarter of 2000, we paid CONDEA Vista Company approximately $16,286,000 representing the adjustment for working capital. The purchase price approximated the fair market value of the net assets acquired. NOTE 4: DISCONTINUED OPERATION On September 2, 1999, we announced our decision to exit the methanol business at the end of 1999. In connection with the discontinuance of the methanol business, we incurred a one-time charge of $7,631,000, net of income tax benefits, related to the write-off of the methanol plant assets, net of expected proceeds, and an accrual for estimated losses during the phase-out period. The disposition of the methanol operation represented the disposal of a business segment under Accounting Principles 4 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 4: DISCONTINUED OPERATION (CONTINUED) Board ("APB") Opinion No. 30. Accordingly, results of the methanol operation were classified as discontinued, and prior periods were restated, including the reallocation of fixed overhead charges to other business segments. For business segment reporting purposes, the methanol business results were previously classified as the segment "Gas Chemicals." Net sales and income from the discontinued operation were as follows:
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, 1999 JUNE 30, 1999 ------------------ ---------------- IN THOUSANDS Net sales................................ $ 10,759 $ 19,083 ======== ======== Pretax loss from discontinued operation.............................. $ (1,192) $ (3,157) Income tax benefit....................... 435 1,152 -------- -------- Net loss from discontinued operation..... $ (757) $ (2,005) ======== ========
Assets and liabilities of the discontinued operation were as follows:
DECEMBER 31, 1999 ----------------- IN THOUSANDS Current assets.............................................. $3,553 Current liabilities......................................... (3,110) ------ Net assets of discontinued operation........................ $ 443 ======
NOTE 5: RECEIVABLES In May 2000, we amended our receivables transfer agreement pursuant to which we sell a percentage ownership interest in a defined pool of our trade receivables. As a result of this amendment, we increased the amount of participating interest in new receivables we sell from $50,000,000 to $75,000,000. NOTE 6: INVENTORIES The major classes of inventories were as follows:
JUNE 30, DECEMBER 31, 2000 1999 -------- ------------ IN THOUSANDS Raw materials and supplies............................ $ 62,658 $ 48,868 Finished goods........................................ 82,826 63,976 -------- -------- $145,484 $112,844 ======== ========
NOTE 7: DERIVATIVE FINANCIAL INSTRUMENTS We have two interest rate swap agreements for a total notional amount of $100,000,000 maturing in June 2002. We also have an interest rate swap agreement for a notional amount of $100,000,000 maturing August 2002. We have designated all of our interest rate swaps as hedges against our senior credit facility floating rate debt. 5 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 7: DERIVATIVE FINANCIAL INSTRUMENTS (CONTINUED) We do not use derivatives for trading purposes. Interest rate swap agreements, a form of derivative, are used to manage interest costs on certain portions of our long-term debt. These financial statements do not reflect temporary market gains and losses on derivative financial instruments. Amounts paid or received on the interest rate swap agreements are recorded to interest expense as incurred. As of June 30, 2000, and December 31, 1999, interest rate swap agreements were the only form of derivative financial instruments outstanding. The fair values of these swap agreements as of June 30, 2000 and December 31, 1999 were $3,727,000 and $3,405,000 (in our favor), respectively. NOTE 8: EARNINGS PER SHARE There are no adjustments to "Net income" or "Income from continuing operations" for the diluted earnings per share computations. The following table reconciles the denominator for the basic and diluted earnings per share computations shown on the condensed consolidated statements of income:
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, --------------------- --------------------- 2000 1999 2000 1999 ---------- -------- ---------- -------- IN THOUSANDS Weighted average common shares--basic............. 31,365 30,922 31,333 30,911 Plus incremental shares from assumed conversions: Options......................................... 153 93 165 102 Employee stock purchase plan rights............. 60 17 61 20 ------ ------ ------ ------ Weighted average common shares--diluted........... 31,578 31,032 31,559 31,033 ====== ====== ====== ======
NOTE 9: SEGMENT INFORMATION We have identified two reportable segments through which we conduct our operating activities: chlorovinyls and aromatics. These two segments reflect the organization which we use for internal reporting. The chlorovinyls segment is a highly integrated chain of products which includes chlorine, caustic soda, vinyl chloride monomer and vinyl resins and compounds. The aromatics segment is also vertically integrated and includes cumene and the co-products phenol and acetone. A third product segment, gas chemicals, which included methanol, was discontinued in the third quarter of 1999. See Note 4 for a discussion of the discontinuance of our methanol operation. Earnings of industry segments exclude interest income and expense, unallocated corporate expenses and general plant services, provision for income taxes, and income and expense items 6 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 9: SEGMENT INFORMATION (CONTINUED) reflected as "other income (expense)" on our consolidated statements of income. Intersegment sales and transfers are insignificant.
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, --------------------- --------------------- 2000 1999 2000 1999 ---------- -------- ---------- -------- IN THOUSANDS Segment net sales: Chlorovinyls................................. $334,212 $132,462 $667,938 $253,270 Aromatics.................................... 79,194 48,251 149,139 106,707 -------- -------- -------- -------- Net sales...................................... $413,406 $180,713 $817,077 $359,977 ======== ======== ======== ======== Segment operating income: Chlorovinyls................................. $ 75,173 $ 14,036 $154,747 $ 24,382 Aromatics.................................... (2,900) 3,078 (9,383) 9,217 Corporate and general plant services......... (3,149) (2,155) (8,099) (5,361) -------- -------- -------- -------- Total operating income......................... $ 69,124 $ 14,959 $137,265 $ 28,238 ======== ======== ======== ========
NOTE 10: SUPPLEMENTAL GUARANTOR INFORMATION Our payment obligations under our 10 3/8% senior subordinated notes are guaranteed by GG Terminal Management Corporation, Great River Oil & Gas Corporation, North American Plastics, LLC, Georgia Gulf Lake Charles, LLC and Georgia Gulf Chemicals & Vinyls, LLC, some of our wholly owned subsidiaries (the "Guarantor Subsidiaries"). The guarantees are full, unconditional and joint and several. The following unaudited condensed consolidating balance sheets, statements of income and statements of cash flows present the financial statements of the parent company, and the combined financial statements of our Guarantor Subsidiaries and our remaining subsidiaries (the "Non-guarantor Subsidiaries"). Separate financial statements of the Guarantor Subsidiaries are not presented because we have determined that they would not be material to investors. In connection with the acquisition of the vinyls business from CONDEA Vista Company on November 12, 1999, we essentially became a holding company by transferring our operating assets and employees to our wholly owned subsidiary, Georgia Gulf Chemicals & Vinyls LLC. Provisions in our senior credit facility limit payment of dividends, distributions, loans and advances to us by our subsidiaries. 7 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 10: SUPPLEMENTAL GUARANTOR INFORMATION (CONTINUED) GEORGIA GULF CORPORATION AND SUBSIDIARIES SUPPLEMENTAL CONDENSED CONSOLIDATING BALANCE SHEET JUNE 30, 2000
PARENT GUARANTOR NON-GUARANTOR COMPANY SUBSIDIARIES SUBSIDIARIES ELIMINATIONS CONSOLIDATED -------- ------------ ------------- ------------ ------------ (IN THOUSANDS) Cash and cash equivalents......... $ 869 $ 158 $ 11 $ -- $ 1,038 Receivables....................... 54,400 288,924 67,727 (257,713) 153,338 Inventories....................... -- 145,484 -- -- 145,484 Prepaid expenses.................. -- 5,172 277 -- 5,449 Deferred income taxes............. -- 6,172 -- -- 6,172 -------- ---------- ------- --------- ---------- Total current assets............ 55,269 445,910 68,015 (257,713) 311,481 -------- ---------- ------- --------- ---------- Plant, property and equipment, at cost............................ 1,418 994,365 -- -- 995,783 Less accumulated depreciation... 1,038 346,125 -- -- 347,163 -------- ---------- ------- --------- ---------- Plant, property and equipment, net......................... 380 648,240 -- -- 648,620 -------- ---------- ------- --------- ---------- Goodwill.......................... -- 81,437 -- -- 81,437 Other assets...................... 7,876 41,946 112 -- 49,934 Investment in subsidiaries........ 587,101 56,824 -- (643,925) -- -------- ---------- ------- --------- ---------- Total assets...................... $650,626 $1,274,357 $68,127 $(901,638) $1,091,472 ======== ========== ======= ========= ========== Current portion of long-term debt............................ $ -- $ 15,021 $ -- $ -- $ 15,021 Account payable................... 192,913 216,308 11,289 (257,713) 162,797 Interest payable.................. 5,228 (18) -- -- 5,210 Accrued income taxes.............. -- 305 600 -- 905 Accrued compensation.............. -- 10,585 -- -- 10,585 Other accrued liabilities......... -- 11,187 -- -- 11,187 -------- ---------- ------- --------- ---------- Total current liabilities....... 198,141 253,388 11,889 (257,713) 205,705 -------- ---------- ------- --------- ---------- Long-term debt.................... 333,513 330,803 -- -- 664,316 -------- ---------- ------- --------- ---------- Deferred income taxes............. -- 102,479 -- -- 102,479 -------- ---------- ------- --------- ---------- Stockholder's equity Common Stock.................... 315 6 20 (26) 315 Additional paid-in-capital...... 7,815 467,322 55,587 (522,909) 7,815 Retained earnings............... 110,842 120,359 631 (120,990) 110,842 -------- ---------- ------- --------- ---------- Total stockholders' equity...... 118,972 587,687 56,238 (643,925) 118,972 -------- ---------- ------- --------- ---------- Total liabilities and stockholders' equity............ $650,626 $1,274,357 $68,127 $(901,638) $1,091,472 ======== ========== ======= ========= ==========
8 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 10: SUPPLEMENTAL GUARANTOR INFORMATION (CONTINUED) GEORGIA GULF CORPORATION AND SUBSIDIARIES SUPPLEMENTAL CONDENSED CONSOLIDATING BALANCE SHEET DECEMBER 31, 1999
PARENT GUARANTOR NON-GUARANTOR COMPANY SUBSIDIARIES SUBSIDIARIES ELIMINATIONS CONSOLIDATED -------- ------------ ------------- ------------ ------------ (IN THOUSANDS) Cash and cash equivalents......... $ 4,151 $ 252 $ 21 $ -- $ 4,424 Receivables....................... 70,008 239,225 125,453 (270,310) 164,376 Inventories....................... -- 112,844 -- -- 112,844 Prepaid expenses.................. -- 4,786 654 -- 5,440 Deferred income taxes............. -- 6,172 -- -- 6,172 -------- ---------- -------- --------- ---------- Total current assets............ 74,159 363,279 126,128 (270,310) 293,256 -------- ---------- -------- --------- ---------- Plant, property and equipment, at cost............................ -- 985,825 -- -- 985,825 Less accumulated depreciation... -- 314,275 -- -- 314,275 -------- ---------- -------- --------- ---------- Plant, property and equipment, net........................... -- 671,550 -- -- 671,550 -------- ---------- -------- --------- ---------- Goodwill.......................... -- 82,676 -- -- 82,676 Other assets...................... 7,906 42,128 49 -- 50,083 Investment in subsidiaries........ 513,000 55,588 -- (568,588) -- Net assets of discontinued operation....................... -- 443 -- -- 443 -------- ---------- -------- --------- ---------- Total assets...................... $595,065 $1,215,664 $126,177 $(838,898) $1,098,008 ======== ========== ======== ========= ========== Current portion of long-term debt............................ $ -- $ 22,000 $ -- $ -- $ 22,000 Accounts payable.................. 200,302 149,019 64,887 (270,310) 143,898 Interest payable.................. 4,336 1,590 -- -- 5,926 Accrued compensation.............. -- 7,682 -- -- 7,682 Other accrued liabilities......... -- 14,046 4,080 -- 18,126 -------- ---------- -------- --------- ---------- Total current liabilities....... 204,638 194,337 68,967 (270,310) 197,632 -------- ---------- -------- --------- ---------- Long-term debt, net of current portion......................... 333,194 416,000 -- -- 749,194 -------- ---------- -------- --------- ---------- Deferred income taxes............. -- 93,949 -- -- 93,949 -------- ---------- -------- --------- ---------- Stockholders' equity Common stock.................... 313 6 20 (26) 313 Additional paid-in capital...... 5,250 467,322 55,587 (522,909) 5,250 Retained earnings............... 51,670 44,050 1,603 (45,653) 51,670 -------- ---------- -------- --------- ---------- Total stockholders' equity...... 57,233 511,378 57,210 (568,588) 57,233 -------- ---------- -------- --------- ---------- Total liabilities and stockholders' equity............ $595,065 $1,215,664 $126,177 $(838,898) $1,098,008 ======== ========== ======== ========= ==========
9 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 10: SUPPLEMENTAL GUARANTOR INFORMATION (CONTINUED) GEORGIA GULF CORPORATION AND SUBSIDIARIES SUPPLEMENTAL CONDENSED CONSOLIDATING INCOME STATEMENT SIX MONTHS ENDED JUNE 30, 2000
PARENT GUARANTOR NON-GUARANTOR COMPANY SUBSIDIARIES SUBSIDIARIES ELIMINATIONS CONSOLIDATED -------- ------------ ------------- ------------ ------------ (IN THOUSANDS) Revenues........................... $ -- $817,383 $4,083 $ (4,389) $817,077 Operating costs and expenses Cost of sales.................... -- 654,780 -- -- 654,780 Selling and administrative....... 2,675 24,587 2,159 (4,389) 25,032 -------- -------- ------ -------- -------- Total operating costs and expenses......................... 2,675 679,367 2,159 (4,389) 679,812 -------- -------- ------ -------- -------- Operating income................... (2,675) 138,016 1,924 -- 137,265 Other income (expense) Interest expense, net............ (16,250) (20,710) -- -- (36,960) Equity in income of subsidiaries................... 76,301 1,236 -- (77,537) -- -------- -------- ------ -------- -------- Income before taxes................ 57,376 118,542 1,924 (77,537) 100,305 Provision for income taxes......... (6,813) 42,233 696 -- 36,116 -------- -------- ------ -------- -------- Net income......................... $ 64,189 $ 76,309 $1,228 $(77,537) $ 64,189 ======== ======== ====== ======== ========
GEORGIA GULF CORPORATION AND SUBSIDIARIES SUPPLEMENTAL CONDENSED CONSOLIDATING INCOME STATEMENT SIX MONTHS ENDED JUNE 30, 1999
PARENT GUARANTOR NON-GUARANTOR COMPANY SUBSIDIARIES SUBSIDIARIES ELIMINATIONS CONSOLIDATED -------- ------------ ------------- ------------ ------------ (IN THOUSANDS) Revenues........................... $316,886 $43,232 $1,566 $(1,707) $359,977 Operating costs and expenses Cost of sales.................... 280,943 30,877 -- -- 311,820 Selling and administrative....... 18,954 1,180 1,492 (1,707) 19,919 -------- ------- ------ ------- -------- Total operating costs and expenses......................... 299,897 32,057 1,492 (1,707) 331,739 -------- ------- ------ ------- -------- Operating income................... 16,989 11,175 74 -- 28,238 Other income (expense) Interest expense, net............ (14,682) -- -- -- (14,682) Equity in income of subsidiaries..................... 7,328 -- -- (7,328) -- -------- ------- ------ ------- -------- Income from continuing operations before taxes..................... 9,635 11,175 74 (7,328) 13,556 Provision for income taxes......... 1,026 3,921 -- -- 4,947 -------- ------- ------ ------- -------- Income from continuing operations....................... 8,609 7,254 74 (7,328) 8,609 Loss from discontinued operation, net.............................. (2,005) -- -- -- (2,005) -------- ------- ------ ------- -------- Net income......................... $ 6,604 $ 7,254 $ 74 $(7,328) $ 6,604 ======== ======= ====== ======= ========
10 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 10: SUPPLEMENTAL GUARANTOR INFORMATION (CONTINUED) GEORGIA GULF CORPORATION AND SUBSIDIARIES SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS SIX MONTHS ENDED JUNE 30, 2000
PARENT GUARANTOR NON-GUARANTOR COMPANY SUBSIDIARIES SUBSIDIARIES ELIMINATIONS CONSOLIDATED -------- ------------ ------------- ------------ ------------ (IN THOUSANDS) Cash flows from operating activities: Net income........................ $64,189 $ 76,309 $ 1,228 $(77,537) $ 64,189 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization................ 572 36,925 38 -- 37,535 Equity in net income of subsidiaries................ (76,301) (1,236) -- 77,537 -- Change in operating assets, liabilities and other....... 9,693 (11,101) 924 -- (484) ------- --------- ------- -------- --------- Net cash (used in) provided by continuing operations........... (1,847) 100,897 2,190 -- 101,240 Net cash used in discontinued operation....................... -- 443 -- -- 443 ------- --------- ------- -------- --------- Net cash (used in) provided by operating activities.............. (1,847) 101,340 2,190 -- 101,683 ------- --------- ------- -------- --------- Cash flows from financing activities: Long-term debt proceeds........... -- 33,819 -- -- 33,819 Long-term debt payments........... -- (125,675) -- -- (125,675) Proceeds from issuance of common stock........................... 1,762 -- -- -- 1,762 Dividends paid.................... (5,017) -- (2,200) 2,200 (5,017) ------- --------- ------- -------- --------- (3,255) (91,856) (2,200) 2,200 (95,111) ------- --------- ------- -------- --------- Cash flows from investing activities: Capital expenditures.............. (380) (9,578) -- -- (9,958) Dividends received from subsidiary...................... 2,200 -- -- (2,200) -- ------- --------- ------- -------- --------- Net cash flow used in investing activities........................ 1,820 (9,578) -- (2,200) (9,958) ------- --------- ------- -------- --------- Net change in cash and cash equivalents....................... (3,282) (94) (10) -- (3,386) Cash and cash equivalents at beginning of period............... 4,151 252 21 -- 4,424 ------- --------- ------- -------- --------- Cash and cash equivalents at end of period............................ $ 869 $ 158 $ 11 $ -- $ 1,038 ======= ========= ======= ======== =========
11 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) NOTE 10: SUPPLEMENTAL GUARANTOR INFORMATION (CONTINUED) GEORGIA GULF CORPORATION AND SUBSIDIARIES SUPPLEMENTAL CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS SIX MONTHS ENDED JUNE 30, 1999
PARENT GUARANTOR NON-GUARANTOR COMPANY SUBSIDIARIES SUBSIDIARIES ELIMINATIONS CONSOLIDATED -------- ------------ ------------- ------------ ------------ (IN THOUSANDS) Cash flows from operating activities: Net income....................... $ 6,604 $7,254 $ 74 $(7,328) $ 6,604 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization............... 22,212 315 -- -- 22,527 Loss on discontinued operation, net............. 2,005 -- -- -- 2,005 Equity in net income of subsidiaries............... (7,328) -- -- 7,328 -- Change in operating assets, liabilities and other...... (9,799) (6,812) 2,617 -- (13,994) -------- ------ ------ ------- -------- Net cash (used in) provided by continuing operations.......... 13,694 757 2,691 -- 17,142 Net cash used in discontinued operation...................... 3,622 -- -- -- 3,622 -------- ------ ------ ------- -------- Net cash (used in) provided by operating activities............. 17,316 757 2,691 -- 20,764 -------- ------ ------ ------- -------- Cash flows from financing activities: Long-term debt proceeds.......... 115,000 -- -- -- 115,000 Long-term debt payments.......... (124,050) (500) -- -- (124,550) Proceeds from issuance of common stock.......................... 359 -- -- -- 359 Dividends paid................... (4,946) -- (2,694) 2,694 (4,946) -------- ------ ------ ------- -------- (13,637) (500) (2,694) 2,694 (14,137) -------- ------ ------ ------- -------- Cash flows from investing activities: Capital expenditures............. (6,543) (576) -- -- (7,119) Dividends received from subsidiary..................... 2,694 -- -- (2,694) -- -------- ------ ------ ------- -------- Net cash flow used in investing activities....................... (3,849) (576) -- (2,694) (7,119) -------- ------ ------ ------- -------- Net change in cash and cash equivalents...................... (170) (319) (3) -- (492) Cash and cash equivalents at beginning of period.............. 788 428 28 -- 1,244 -------- ------ ------ ------- -------- Cash and cash equivalents at end of period........................... $ 618 $ 109 $ 25 $ -- $ 752 ======== ====== ====== ======= ========
12 Item 2: Management's Discussion and Analysis of Financial Condition and Results of Operations. RESULTS OF OPERATIONS Georgia Gulf manufactures and markets products through two highly integrated lines categorized into chlorovinyls and aromatic chemicals. Our chlorovinyl products include chlorine, caustic soda, sodium chlorate, vinyl chloride monomer ("VCM"), and polyvinyl chloride ("PVC") resins and compounds; our primary aromatic chemical products include cumene, phenol and acetone. During 1999, we announced our decision to exit the methanol business and had ceased operations at the end of the year. Additionally, on November 12, 1999, we completed the purchase of all the assets of the vinyls business of CONDEA Vista Company. The vinyls business is an integrated producer of VCM, PVC resins and PVC compounds. We have included the results of operations for the vinyls business in our consolidated financial statements since the date of acquisition. THREE MONTHS ENDED JUNE 30, 2000 COMPARED WITH THREE MONTHS ENDED JUNE 30, 1999 NET SALES. Net sales for the quarter ended June 30, 2000 were $413.4 million, an increase of 129 percent compared to $180.7 million for the same period in 1999. This increase was due to 49 percent higher sales volumes, largely attributable to the acquisition of the vinyls business, and an increase in the overall average selling price of 54 percent. Net sales of chlorovinyls for the second quarter of 2000 were $334.2 million, 152 percent higher than net sales for second quarter of 1999 of $132.5 million. This increase was the result of a 68 percent increase in sales volume and a 50 percent increase in sales prices. Sales volume increases were primarily attributable to the vinyls business acquired during the fourth quarter of 1999 which more than doubled our sales of vinyl resins. The higher sales prices resulted from continuing strong demand for vinyl products, particularly VCM and vinyl resins. Net sales of aromatics for the second quarter of 2000 were $79.2 million, an increase of 64 percent compared to $48.3 million for the same period in 1999. This increase was the result of a 47 percent improvement in sales prices and 12 percent higher sales volumes. Sales prices for cumene, phenol and acetone all increased primarily as a result of significantly higher raw material costs. COST OF SALES. Cost of sales for the second quarter of 2000 was $332.9 million, an increase of 113 percent compared to $156.1 million for the second quarter of 1999. The primary factor for this increase was the additional sales volumes from the acquired vinyls business. Also contributing to the increase were higher prices for all purchased major raw materials. As a percentage of sales, cost of sales decreased to 81 percent in the second quarter of 2000 compared to 86 percent in the second quarter of 1999. This decrease was caused by overall sales price increases outpacing higher raw material cost and also an increase in capacity utilization rates. SELLING AND ADMINISTRATIVE EXPENSES. Selling and administrative expenses were $11.4 million for the three months ended June 30, 2000, an increase of 18 percent from the same period in 1999. This increase is primarily attributable to the effects of the acquired vinyls business and higher profit sharing expense. Additionally, the ongoing costs of a revolving trade receivables sales program increased after we sold an additional $25.0 million of trade receivables during the second quarter of 2000. OPERATING INCOME. Operating income in the second quarter of 2000 was $69.1 million, an increase of 362 percent compared to $15.0 million in the second quarter of 1999. This increase was the result of higher operating income in chlorovinyls offset in part by decreased operating profit in aromatics. As a percentage of net sales, operating profit increased to 17 percent of net sales in the second quarter of 2000 compared to 8 percent for the same period in 1999. This increase in operating profit as a percentage of net sales was the result of overall sales price increases outpacing increases in raw material costs. 13 Our chlorovinyls operating profit for the second quarter of 2000 was $75.2 million, an increase of 436 percent compared to $14.0 million for the same period in 1999. The most significant factors in this increase are the improvements in VCM and vinyl resin profit margins coupled with operating income from the acquired vinyls business. Our aromatics operating loss for the second quarter of 2000 was $2.9 million, a decrease of 194 percent compared to operating profit of $3.1 million in the second quarter 1999. Aromatic sales price increases were unable to compensate for the significantly higher raw material costs of benzene and propylene. NET INTEREST EXPENSE. Interest expense increased to $18.0 million for the quarter ended June 30, 2000 compared with $7.4 million for the same period in 1999. This increase was primarily attributable to higher debt balances related to both the acquisition of the vinyls business and the purchase of the previously leased cogeneration facility during the fourth quarter of 1999. PROVISION FOR INCOME TAXES. Provision for income taxes was $18.4 million for the second quarter of 2000 compared to $2.8 million for the second quarter of 1999. Our effective tax rate in the second quarter of 2000 was 36.0 percent compared to 36.5 percent for the same period in 1999. INCOME FROM CONTINUING OPERATIONS. Income from continuing operations for the three months ended June 30, 2000 was $32.8 million, an increase of 578 percent compared to $4.8 million for the three months ended June 30, 1999. Income from continuing operations increased significantly as a result of both overall sales volume and price increases that more than offset higher raw material costs and additional interest expense. LOSS FROM DISCONTINUED OPERATION. The discontinued methanol operation incurred a net loss of $0.8 million in the second quarter of 1999. The methanol operation was discontinued in the third quarter of 1999. NET INCOME. Net income for the second quarter of 2000 was $32.8 million, a 705 percent increase from $4.1 million in the second quarter of 1999. This increase was due to the factors discussed above. SIX MONTHS ENDED JUNE 30, 2000 COMPARED WITH SIX MONTHS ENDED JUNE 30, 1999 NET SALES. For the six months ended June 30, 2000, net sales were $817.1 million, an increase of 127 percent compared to $360.0 million for the same period in 1999. This increase was due to a 50 percent increase in sales volumes, largely attributable to the acquisition of the vinyls business, and also a 52 percent higher overall average selling price. Net sales of chlorovinyls for the first half of 2000 were $667.9 million, 164 percent higher than net sales for first half of 1999 of $253.3 million. Sales volume increased by 78 percent primarily as a result of the vinyls business acquired during the fourth quarter of 1999, which more than doubled our sales of vinyl resins. Higher average sales prices of 48 percent resulted from continuing strong demand for vinyl products, particularly VCM and vinyl resins. Net sales of aromatics for the first half of 2000 were $149.1 million, an increase of 40 percent compared to $106.7 million for the same period in 1999. This increase was primarily the result of a 38 percent improvement in sales prices as sales volumes remained basically the same. Cumene and acetone prices increased primarily as a result of continued strong demand and tighter supply. COST OF SALES. Cost of sales for the first half of 2000 was $654.8 million, an increase of 110 percent compared to $311.8 million for the first half of 1999. Increased sales volumes from the acquired vinyls business were the primary cause of this increase. Also contributing to the increase were higher prices for all purchased major raw materials. As a percentage of sales, cost of sales decreased to 80 percent in the first half of 2000 compared to 87 percent in the first half of 1999. Overall sales price 14 increases outpaced higher raw material costs and our plants operated at higher capacity utilization rates. SELLING AND ADMINISTRATIVE EXPENSES. Selling and administrative expenses were $25.0 million for the six months ended June 30, 2000, an increase of 26 percent from the same period in 1999. This increase is primarily attributable to the effects of the acquired vinyls business and higher profit sharing expense. During the first quarter of 2000, we incurred transition charges associated with the acquisition of approximately $0.8 million. OPERATING INCOME. Operating income in the first six months of 2000 was $137.3 million, an increase of 386 percent compared to $28.2 million in the first six months of 1999. Higher operating income in chlorovinyls was offset in part by decreased operating profit in aromatics. As a percentage of net sales, operating profit increased to 17 percent of net sales in the first six months of 2000 compared to 8 percent for the same period in 1999. Overall sales price increases outpaced increases in raw material costs which caused the increase in operating profit as a percentage of net sales. Our chlorovinyls operating profit for the first six months of 2000 was $154.7 million, an increase of 535 percent compared to $24.4 million for the same period in 1999. The most significant factors in this increase are operating income from the acquired vinyls business and the improvements in VCM and vinyl resin profit margins. Our aromatics operating loss for the first six months of 2000 was $9.4 million, a decrease of 202 percent compared to operating profit of $9.2 million in the first six months 1999. This decrease was a result of significant increases in the cost of benzene and propylene that outpaced selling price increases for aromatic products. NET INTEREST EXPENSE. Interest expense for the first half of 2000 was $37.0 million compared with $14.7 million for the same period in 1999. This increase was primarily attributable to higher debt balances related to both the acquisition of the vinyls business and the purchase of the previously leased cogeneration facility during the fourth quarter of 1999. PROVISION FOR INCOME TAXES. Provision for income taxes was $36.1 million for the first six months of 2000 compared to $4.9 million for the same period of 1999. Our effective tax rate for the six months ended June 30, 2000 was 36.0 percent compared to 36.5 percent for the same period in 1999. INCOME FROM CONTINUING OPERATIONS. Income from continuing operations for the six months ended June 30, 2000 was $64.2 million, an increase of 646 percent compared to $8.6 million for the six months ended June 30, 1999. Income from continuing operations increased significantly as a result of both overall sales volume and price increases that more than offset higher raw material costs and additional interest expense. LOSS FROM DISCONTINUED OPERATION. The discontinued methanol operation incurred a net loss of $2.0 million in the first half of 1999. The methanol operation was discontinued in the third quarter of 1999. NET INCOME. Net income for the first half of 2000 was $64.2 million, an increase of 872 percent from $6.6 million in the first half of 1999. This increase was due to the factors discussed above. 15 LIQUIDITY AND CAPITAL RESOURCES For the six months ended June 30, 2000, we generated $101.7 million in cash flow from operating activities as compared to $20.8 million generated during the same 1999 period. Major sources of cash flow for the first half of 2000 were net income of $64.2 million and non-cash provisions of $37.5 for depreciation and amortization. Total working capital at June 30, 2000 was $105.8 million versus $95.6 million at December 31, 1999. Significant changes in working capital for the first half of 2000 included a decrease in accounts receivable, higher inventories, a lower current portion of long-term debt, an increase in accounts payable and a decrease in other accrued liabilities. The decrease in accounts receivable was primarily attributable to the sale of $25.0 million of trade receivables under a revolving trade receivables sales program. Inventories increased as a result of higher raw material costs and quantities. Increases in accounts payable were attributable to the timing of certain payments and higher trade payable balances related to increased raw material prices. Accounts payable increases were partially offset by the payment of $16.3 million to CONDEA Vista Company representing a working capital adjustment related to our acquisition in November 1999. Decreases in other accrued liabilities were attributable to the timing of certain payments. Significant working capital changes for the first half of 1999 included the payment of certain litigation expenses reimbursed by our insurance carriers later in 1999 and an increase in accounts payable and accrued liabilities due to the timing of payments. Debt decreased by $91.9 million during the six months ended June 30, 2000 to $679.3 million. As of June 30, 2000, we had availability to borrow an additional $80.2 million under the revolving credit facility. Capital expenditures for the six months ended June 30, 2000 were $10.0 million as compared to $7.1 million for the same 1999 period. Capital expenditures for 2000 will be directed toward certain environmental projects and increased efficiency of existing operations. We estimate total capital expenditures for 2000 will approximate $30.0 million. We declared dividends of $0.16 per share or $5.0 million during the first six months of 2000. As of June 30, 2000, we had authorization to repurchase up to 5.2 million shares under a common stock repurchase program; however, we have suspended the stock repurchase program and we did not repurchase any shares during the first half of 2000. Our ability to satisfy our debt obligations and to pay principal and interest on our debt, fund working capital, and make anticipated capital expenditures will depend on our future performance, which is subject to general economic conditions and other factors, some of which are beyond our control. We believe that based on current and anticipated levels of operations and conditions in our markets, cash flow from operations will be adequate for the foreseeable future to make required payments of principal and interest on our debt and fund our working capital and capital expenditure requirements. We are essentially a holding company and, accordingly, must rely on distributions, loans and other intercompany cash flows from our wholly owned subsidiaries to generate the funds necessary to satisfy the repayment of our existing debt. Provisions in our senior credit facility limit payments of dividends, distributions, loans or advances to us by our subsidiaries. OUTLOOK For the third quarter, we have begun to see signs of an economic slowdown, especially in the vinyl pipe and siding area, which impacts our chlorovinyl segment. This has negatively affected July resin shipments. We do not expect much improvement in the aromatics chain as the costs of raw materials continue to rise and we had a major phenol plant turnaround in July. Overall, we expect that our third quarter earnings will be negatively impacted when compared to the second quarter. 16 YEAR 2000 ISSUE UPDATE We did not experience any significant malfunctions or errors in our operating or business systems when the date changed from 1999 to 2000. Based on operations since January 1, 2000, we do not expect any significant impact to our ongoing business as a result of the year 2000 issue. However, it is possible that the full impact of the date change has not been fully recognized. We believe that any such problems are likely to be minor and correctable. In addition, we could still be negatively affected if year 2000 or similar issues adversely affect our customers or suppliers. Currently we are not aware of any significant year 2000 or similar problems that have arisen for our customers and suppliers. Expenditures related to year 2000 compliance efforts were not material. FORWARD-LOOKING STATEMENTS This Form 10-Q and other communications to stockholders may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to, among other things, our outlook for future periods, supply and demand, pricing trends and market forces within the chemical industry, cost reduction strategies and their results, planned capital expenditures, long-term objectives of management and other statements of expectations concerning matters that are not historical facts. Predictions of future results contain a measure of uncertainty and, accordingly, actual results could differ materially due to various factors. Factors that could change forward-looking statements are, among others: - changes in the general economy; - changes in demand for our products or increases in overall industry capacity that could affect production volumes and/or pricing; - changes and/or cyclicality in the industries to which our products are sold; - availability and pricing of raw materials; - technological changes affecting production; - difficulty in plant operations and product transportation; - governmental and environmental regulations; and - other unforeseen circumstances. A number of these factors are discussed in this Form 10-Q and in our other periodic filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 1999. Item 3. Quantitative and Qualitative Disclosures About Market Risk. For a discussion of certain market risks related to Georgia Gulf, see Part I, Item 7A, "Quantitative and Qualitative Disclosures About Market Risk", in our Annual Report on Form 10-K for the year ended December 31, 1999. There have been no significant developments with respect to our exposure to market risk except for the change in the fair value of interest rate swaps disclosed in Note 6 to the financial statements included herein. 17 PART II. OTHER INFORMATION. Item 1. Legal Proceedings. We are involved in certain legal proceedings that are described in our 1999 Annual Report on Form 10-K and our quarterly report on Form 10-Q for the period ending March 31, 2000. During the three months ended June 30, 2000, there were no material developments in the status of those legal proceedings that have not been previously disclosed in our 1999 Annual Report on Form 10-K or in our quarterly report on Form 10-Q for the period ending March 31, 2000. Item 4. Submission of Matters to a Vote of Security Holders The Company's annual meeting of stockholders was held May 16, 2000 in Atlanta, Georgia for the following purposes: (i) to elect three directors to serve for a term of three years; (ii) to consider and take action upon the approval and adoption of the First Amendment to the Employee Stock Purchase Plan, which increases the number of shares issuable under that plan by 200,000 shares; and (iii) to consider and take action upon the ratification of the selection of Arthur Andersen LLP to serve as independent public accountants for the year ending December 31, 2000. The results of the voting by stockholders at the annual meeting were as follows:
BROKER NON-VOTES DIRECTORS FOR WITHHELD OR ABSTENTIONS --------- ---------- -------- ---------------- John D. Bryan............................ 22,725,693 433,572 0 Dennis M. Chorba......................... 22,386,968 772,297 0 Patrick J. Fleming....................... 22,736,537 422,728 0
In addition, the terms of the following directors continued after the meeting: John E. Akitt James R. Kuse Charles T. Harris III Jerry R. Satrum Edward A. Schmitt
The approval and adoption of the First Amendment to the Employee Stock Purchase Plan, which increases the number of shares issuable under that plan by 200,000 shares was ratified by the following votes:
FOR AGAINST ABSTAIN BROKER NON-VOTES --------------------- -------- -------- ---------------- 23,073,612..... 59,013 25,639 1,001
The selection of Arthur Andersen LLP to serve as independent public accountants for the Company for the year ending December 31, 2000, was ratified by the following votes:
FOR AGAINST ABSTAIN BROKER NON-VOTES --------------------- -------- -------- ---------------- 23,653,410..... 14,161 13,748 1,001
Item 6. Exhibits and Reports on Form 8-K. a) Exhibit 10 Amended and Restated Receivables Transfer Agreement dated as of May 24, 2000 Among GGRC Corp., as Seller, and Georgia Gulf Corporation and Georgia Gulf Chemicals and Vinyls, LLC, as Initial Servicers, and Blue Ridge Asset Funding Corporation, as Purchaser, and Wachovia Bank, N.A., as Administrative Agent. b) No reports on Form 8-K were filed with Securities and Exchange Commission during the second quarter of 2000. 18 SIGNATURES 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, thereunto duly authorized. GEORGIA GULF CORPORATION (Registrant) Date August 11, 2000 /s/ EDWARD A. SCHMITT ------------------------ ------------------------------------------- Edward A. Schmitt President and Chief Executive Officer (Principal Executive Officer) Date August 11, 2000 /s/ RICHARD B. MARCHESE ------------------------ ------------------------------------------- Richard B. Marchese Vice President Finance, Chief Financial Officer and Treasurer (Principal Financial Officer)
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