DELAWARE
|
25-1190717
|
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
Large Accelerated Filer ☒
|
Accelerated Filer ☐
|
Non- accelerated Filer ☐
|
Smaller Reporting Company ☐
|
Class
|
Outstanding at April 13, 2015
|
Common Stock, $0.10 par value |
34,731,478
|
Page No.
|
||
PART I. FINANCIAL INFORMATION | ||
Item 1.
|
Financial Statements:
|
|
3
|
||
4
|
||
5
|
||
|
|
|
6 | ||
|
|
|
7
|
||
19
|
||
Item 2.
|
20 | |
Item 3.
|
31
|
|
Item 4.
|
31
|
|
PART II. OTHER INFORMATION | ||
Item 1.
|
32
|
|
Item 1A.
|
34
|
|
Item 2.
|
34
|
|
Item 3.
|
34
|
|
Item 4.
|
34
|
|
Item 5.
|
34
|
|
Item 6.
|
35
|
|
36
|
Three Months Ended
|
||||||||
Mar. 29,
2015 |
Mar. 30,
2014 |
|||||||
(in millions, except per share data)
|
||||||||
Product sales
|
$
|
394.7
|
$
|
244.4
|
||||
Service revenue
|
58.6
|
-
|
||||||
Total net sales
|
453.3
|
244.4
|
||||||
Cost of goods sold
|
292.9
|
189.1
|
||||||
Cost of service revenue
|
43.8
|
-
|
||||||
Total cost of sales
|
336.7
|
189.1
|
||||||
Production margin
|
116.6
|
55.3
|
||||||
Marketing and administrative expenses
|
45.5
|
21.5
|
||||||
Research and development expenses
|
5.9
|
5.1
|
||||||
Amortization expense of intangible assets acquired
|
1.9
|
-
|
||||||
Acquisition related transaction and integration costs
|
3.4
|
5.1
|
||||||
Income from operations
|
59.9
|
23.6
|
||||||
Interest expense, net
|
(15.4
|
)
|
(0.1
|
)
|
||||
Other non-operating income (deductions), net
|
3.2
|
(0.2
|
)
|
|||||
Total non-operating deductions, net
|
(12.2
|
)
|
(0.3
|
)
|
||||
Income before provision for taxes and equity in earnings
|
47.7
|
23.3
|
||||||
Provision for taxes on income
|
12.1
|
7.0
|
||||||
Equity in earnings of affiliates, net of tax
|
0.4
|
-
|
||||||
Consolidated net income
|
36.0
|
16.3
|
||||||
Less:
|
||||||||
Net income attributable to non-controlling interests
|
0.9
|
0.7
|
||||||
Net income attributable to Minerals Technologies Inc. (MTI)
|
$
|
35.1
|
$
|
15.6
|
||||
Earnings per share:
|
||||||||
Basic earnings per share attributable to MTI
|
$
|
1.01
|
$
|
0.45
|
||||
Diluted earnings per share attributable to MTI
|
$
|
1.01
|
$
|
0.45
|
||||
Cash dividends declared per common share
|
$
|
0.05
|
$
|
0.05
|
||||
Shares used in computation of earnings per share:
|
||||||||
Basic
|
34.7
|
34.4
|
||||||
Diluted
|
34.9
|
34.7
|
Three Months Ended
|
||||||||
Mar. 29,
2015 |
Mar. 30,
2014 |
|||||||
(millions of dollars)
|
||||||||
Consolidated net income
|
$
|
36.0
|
$
|
16.3
|
||||
Other comprehensive income (loss), net of tax:
|
||||||||
Foreign currency translation adjustments
|
(27.8
|
)
|
2.1
|
|||||
Pension and postretirement plan adjustments
|
1.4
|
0.8
|
||||||
Cash flow hedges:
|
||||||||
Net derivative gains (losses) arising during the period
|
-
|
(0.1
|
)
|
|||||
Total other comprehensive income (loss), net of tax
|
(26.4
|
)
|
2.8
|
|||||
Total comprehensive income including non-controlling interests
|
9.6
|
19.1
|
||||||
Comprehensive (income) loss attributable to non-controlling interest
|
1.0
|
(0.4
|
)
|
|||||
Comprehensive income attributable to MTI
|
$
|
10.6
|
$
|
18.7
|
Mar. 29,
2015* |
Dec. 31,
2014** |
|||||||
(millions of dollars)
|
||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
193.9
|
$
|
249.6
|
||||
Short-term investments, at cost which approximates market
|
2.1
|
0.8
|
||||||
Accounts receivable, net
|
414.8
|
412.6
|
||||||
Inventories
|
207.4
|
211.8
|
||||||
Prepaid expenses
|
27.1
|
25.6
|
||||||
Other current assets
|
23.8
|
24.2
|
||||||
Total current assets
|
869.1
|
924.6
|
||||||
Property, plant and equipment
|
2,153.6
|
2,174.2
|
||||||
Less accumulated depreciation and depletion
|
(978.1
|
)
|
(992.1
|
)
|
||||
Property, plant and equipment, net
|
1,175.5
|
1,182.1
|
||||||
Goodwill
|
768.3
|
770.9
|
||||||
Intangible assets
|
210.2
|
212.1
|
||||||
Deferred income taxes
|
57.4
|
55.6
|
||||||
Other assets and deferred charges
|
79.0
|
81.4
|
||||||
Total assets
|
$
|
3,159.5
|
$
|
3,226.7
|
||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
||||||||
Current liabilities:
|
||||||||
Short-term debt
|
$
|
6.0
|
$
|
5.6
|
||||
Current maturities of long-term debt
|
0.4
|
0.3
|
||||||
Accounts payable
|
169.0
|
170.4
|
||||||
Other current liabilities
|
139.3
|
176.6
|
||||||
Total current liabilities
|
314.7
|
352.9
|
||||||
Long-term debt, net of unamortized discount
|
1,418.4
|
1,455.5
|
||||||
Deferred income taxes
|
313.1
|
314.5
|
||||||
Other non-current liabilities
|
214.3
|
214.9
|
||||||
Total liabilities
|
2,260.5
|
2,337.8
|
||||||
Shareholders' equity:
|
||||||||
Common stock
|
4.8
|
4.8
|
||||||
Additional paid-in capital
|
375.5
|
373.0
|
||||||
Retained earnings
|
1,225.1
|
1,191.8
|
||||||
Accumulated other comprehensive loss
|
(139.4
|
)
|
(112.9
|
)
|
||||
Less common stock held in treasury
|
(593.7
|
)
|
(593.7
|
)
|
||||
Total MTI shareholders' equity
|
872.3
|
863.0
|
||||||
Non-controlling interest
|
26.7
|
25.9
|
||||||
Total shareholders' equity
|
899.0
|
888.9
|
||||||
Total liabilities and shareholders' equity
|
$
|
3,159.5
|
$
|
3,226.7
|
*
|
Unaudited
|
**
|
Condensed from audited financial statements
|
Three Months Ended
|
||||||||
Mar. 29,
2015
|
Mar. 30,
2014
|
|||||||
(millions of dollars)
|
||||||||
Operating Activities:
|
||||||||
Consolidated net income
|
$
|
36.0
|
$
|
16.3
|
||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Depreciation, depletion and amortization
|
23.7
|
11.9
|
||||||
Other non-cash items
|
1.6
|
1.6
|
||||||
Net changes in operating assets and liabilities
|
(41.7
|
)
|
(14.6
|
)
|
||||
Net cash provided by operating activities
|
19.6
|
15.2
|
||||||
Investing Activities:
|
||||||||
Purchases of property, plant and equipment, net
|
(24.2
|
)
|
(11.3
|
)
|
||||
Net purchases of short-term investments
|
(1.7
|
)
|
0.7
|
|||||
Net cash used in investing activities
|
(25.9
|
)
|
(10.6
|
)
|
||||
Financing Activities:
|
||||||||
Proceeds from issuance of long-term debt
|
2.5
|
-
|
||||||
Repayment of long-term debt
|
(40.0
|
)
|
(0.7
|
)
|
||||
Net issuance (repayment) of short-term debt
|
0.4
|
-
|
||||||
Proceeds from issuance of stock under option plan
|
0.8
|
1.7
|
||||||
Excess tax benefits related to stock incentive programs
|
0.1
|
0.2
|
||||||
Dividends paid to non-controlling interest
|
(0.2
|
)
|
(0.3
|
)
|
||||
Cash dividends paid
|
(1.8
|
)
|
(1.7
|
)
|
||||
Net cash provided by (used in) financing activities
|
(38.2
|
)
|
(0.8
|
)
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
(11.2
|
)
|
(1.1
|
)
|
||||
Net increase (decrease) in cash and cash equivalents
|
(55.7
|
)
|
2.7
|
|||||
Cash and cash equivalents at beginning of period
|
249.6
|
490.3
|
||||||
Cash and cash equivalents at end of period
|
$
|
193.9
|
$
|
493.0
|
||||
Supplemental disclosure of cash flow information:
|
||||||||
Interest paid
|
$
|
19.9
|
$
|
-
|
||||
Income taxes paid
|
$
|
13.5
|
$
|
5.6
|
Note 1.
|
Basis of Presentation and Summary of Significant Accounting Policies
|
Note 2.
|
Business Combination
|
(millions of dollars)
|
||||
Cash consideration transferred to AMCOL shareholders
|
$
|
1,519.4
|
||
AMCOL notes repaid at close
|
325.6
|
|||
Total consideration transferred to debt and equity holders
|
1,845.0
|
|||
Cash acquired
|
42.7
|
|||
Total consideration transferred to debt and equity holders, net of cash acquired
|
$
|
1,802.3
|
Preliminary
Allocation
|
||||
(millions of dollars)
|
||||
Accounts receivable
|
$
|
235.7
|
||
Inventories
|
157.3
|
|||
Other current assets
|
65.0
|
|||
Mineral rights
|
535.5
|
|||
Plant, property and equipment
|
371.2
|
|||
Goodwill
|
708.1
|
|||
Intangible assets
|
214.3
|
|||
Other non-current assets
|
51.4
|
|||
Total assets acquired
|
$
|
2,338.5
|
||
Accounts payable
|
66.4
|
|||
Accrued expenses
|
61.6
|
|||
Non-current deferred tax liability
|
322.3
|
|||
Other non-current liabilities
|
85.9
|
|||
Total liabilities assumed
|
$
|
536.2
|
||
Net assets acquired
|
$
|
1,802.3
|
Three Months Ended
|
||||||||
Pro Forma Results
|
Mar. 29,
2015
|
Mar. 30,
2014
|
||||||
(millions of dollars)
|
||||||||
Net sales
|
$
|
453.3
|
$
|
493.8
|
||||
Income before provision for taxes and equity in earnings
|
47.7
|
23.1
|
||||||
Consolidated net Income
|
36.0
|
16.0
|
Note 3.
|
Earnings Per Share (EPS)
|
Three Months Ended
|
||||||||
Mar. 29,
2015
|
Mar. 30,
2014
|
|||||||
(in millions, except per share data)
|
||||||||
Net income attributable to MTI
|
$
|
35.1
|
$
|
15.6
|
||||
Weighted average shares outstanding
|
34.7
|
34.4
|
||||||
Dilutive effect of stock options and stock units
|
0.2
|
0.3
|
||||||
Weighted average shares outstanding, adjusted
|
34.9
|
34.7
|
||||||
Basic earnings (Loss) per share attributable to MTI
|
$
|
1.01
|
$
|
0.45
|
||||
Diluted earnings (Loss) per share attributable to MTI
|
$
|
1.01
|
$
|
0.45
|
Note 4.
|
Restructuring Charges
|
(millions of dollars)
|
||||
Restructuring liability, December 31, 2014
|
$
|
14.6
|
||
Additional provisions
|
-
|
|||
Cash payments
|
(2.9
|
)
|
||
Restructuring liability, March 29, 2015
|
$
|
11.7
|
Note 5.
|
Income Taxes
|
Note 6.
|
Inventories
|
Mar. 29,
2015
|
Dec. 31,
2014
|
|||||||
(millions of dollars)
|
||||||||
Raw materials
|
$
|
84.5
|
$
|
85.9
|
||||
Work-in-process
|
7.1
|
6.7
|
||||||
Finished goods
|
85.9
|
88.7
|
||||||
Packaging and supplies
|
29.9
|
30.5
|
||||||
Total inventories
|
$
|
207.4
|
$
|
211.8
|
Note 7.
|
Goodwill and Other Intangible Assets
|
Mar. 29, 2015
|
Dec. 31, 2014
|
|||||||||||||||
Gross
Carrying
Amount
|
Accumulated
Amortization
|
Gross
Carrying
Amount
|
Accumulated
Amortization
|
|||||||||||||
(millions of dollars)
|
||||||||||||||||
Tradenames
|
$
|
191.2
|
$
|
5.1
|
$
|
191.2
|
$
|
3.7
|
||||||||
Technology
|
18.7
|
1.4
|
18.7
|
1.0
|
||||||||||||
Patents and trademarks
|
6.4
|
4.1
|
6.4
|
4.0
|
||||||||||||
Customer relationships
|
4.4
|
0.1
|
4.4
|
0.1
|
||||||||||||
Customer lists
|
2.9
|
2.7
|
2.9
|
2.7
|
||||||||||||
$
|
223.6
|
$
|
13.4
|
$
|
223.6
|
$
|
11.5
|
Note 8.
|
Long-Term Debt and Commitments
|
Mar. 29,
2015
|
Dec. 31,
2014
|
|||||||
(millions of dollars)
|
||||||||
Term Loan Facilitydue May 9, 2021, net of unamortized discount of $13.6 and $14.2, respectively
|
$
|
1,414.6
|
$
|
1,454.0
|
||||
China Loan Facilities
|
4.2
|
1.8
|
||||||
Total
|
$
|
1,418.8
|
$
|
1,455.8
|
||||
Less: Current maturities
|
0.4
|
0.3
|
||||||
Long-term debt
|
$
|
1,418.4
|
$
|
1,455.5
|
Note 9.
|
Benefit Plans
|
Pension Benefits
|
||||||||
Three Months Ended
|
||||||||
Mar. 29,
2015 |
Mar. 30,
2014 |
|||||||
(millions of dollars)
|
||||||||
Service cost
|
$
|
2.6
|
$
|
2.0
|
||||
Interest cost
|
3.9
|
3.1
|
||||||
Expected return on plan assets
|
(5.1
|
)
|
(4.3
|
)
|
||||
Amortization:
|
||||||||
Prior service cost
|
0.3
|
0.3
|
||||||
Recognized net actuarial loss
|
2.8
|
1.7
|
||||||
Net periodic benefit cost
|
$
|
4.5
|
$
|
2.8
|
Other Benefits
|
||||||||
Three Months Ended
|
||||||||
Mar. 29,
2015 |
Mar. 30,
2014 |
|||||||
(millions of dollars)
|
||||||||
Service cost
|
$
|
0.1
|
$
|
0.1
|
||||
Interest cost
|
0.1
|
0.1
|
||||||
Amortization:
|
||||||||
Prior service cost
|
(0.8
|
)
|
(0.8
|
)
|
||||
Recognized net actuarial (gain)/loss
|
-
|
-
|
||||||
Net periodic benefit cost
|
$
|
(0.6
|
)
|
$
|
(0.6
|
)
|
Note 10.
|
Comprehensive Income
|
Three Months Ended
|
||||||||
Amounts Reclassified Out of Accumulated Other Comprehensive Income (Loss)
|
Mar. 29,
2015 |
Mar. 30,
2014 |
||||||
(millions of dollars)
|
||||||||
Amortization of pension items:
|
||||||||
Pre-tax amount
|
$
|
2.3
|
$
|
1.2
|
||||
Tax
|
(0.9
|
)
|
(0.4
|
)
|
||||
Net of tax
|
$
|
1.4
|
$
|
0.8
|
Foreign Currency
Translation
Adjustment
|
Unrecognized
Pension Costs
|
Net Gain
on Cash
Flow
Hedges
|
Total
|
|||||||||||||
(millions of dollars)
|
||||||||||||||||
Balance as of December 31, 2014
|
$
|
(33.4
|
)
|
$
|
(82.1
|
)
|
$
|
2.6
|
$
|
(112.9
|
)
|
|||||
Other comprehensive income (loss) before reclassifications
|
(27.9
|
)
|
-
|
-
|
(27.9
|
)
|
||||||||||
Amounts reclassified from AOCI
|
-
|
1.4
|
-
|
1.4
|
||||||||||||
Net current period other comprehensive income (loss)
|
(27.9
|
)
|
1.4
|
-
|
(26.5
|
)
|
||||||||||
Balance as of March 29, 2015
|
$
|
(61.3
|
)
|
$
|
(80.7
|
)
|
$
|
2.6
|
$
|
(139.4
|
)
|
Note 11.
|
Accounting for Asset Retirement Obligations
|
(millions of dollars)
|
||||
Asset retirement liability, December 31, 2014
|
$
|
23.0
|
||
Accretion expense
|
0.4
|
|||
Reversals
|
(0.1
|
)
|
||
Payments
|
(0.3
|
)
|
||
Foreign currency translation
|
(0.3
|
)
|
||
Asset retirement liability, March 29, 2015
|
$
|
22.7
|
Note 12.
|
Contingencies
|
Note 13.
|
Non-controlling interests
|
Equity Attributable to MTI
|
||||||||||||||||||||||||||||
Common
Stock
|
Additional
Paid-in
Capital
|
Retained
Earnings
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Treasury
Stock
|
Non-controlling
Interests
|
Total
|
||||||||||||||||||||||
(millions of dollars)
|
||||||||||||||||||||||||||||
Balance as of December 31, 2014
|
$
|
4.8
|
$
|
373.0
|
$
|
1,191.8
|
$
|
(112.9
|
)
|
$
|
(593.7
|
)
|
$
|
$ 25.9
|
$
|
888.9
|
||||||||||||
Net income
|
-
|
-
|
35.1
|
-
|
-
|
0.9
|
36.0
|
|||||||||||||||||||||
Other comprehensive income (loss)
|
-
|
-
|
-
|
(26.5
|
)
|
-
|
0.1
|
(26.4
|
)
|
|||||||||||||||||||
Dividends declared
|
-
|
-
|
(1.8
|
)
|
-
|
-
|
-
|
(1.8
|
)
|
|||||||||||||||||||
Dividends to non-controlling interest
|
-
|
-
|
-
|
-
|
-
|
(0.2
|
)
|
(0.2
|
)
|
|||||||||||||||||||
Issuance of shares pursuant to employee stock compensation plans
|
-
|
0.7
|
-
|
-
|
-
|
-
|
0.7
|
|||||||||||||||||||||
Income tax benefit arising from employee stock compensation plans
|
-
|
0.5
|
-
|
-
|
-
|
-
|
0.5
|
|||||||||||||||||||||
Stock based compensation
|
-
|
1.3
|
-
|
-
|
-
|
-
|
1.3
|
|||||||||||||||||||||
Balance as of March 29, 2015
|
$
|
4.8
|
$
|
375.5
|
$
|
1,225.1
|
$
|
(139.4
|
)
|
$
|
(593.7
|
)
|
$
|
26.7
|
$
|
899.0
|
Note 14.
|
Segment and Related Information
|
|
Three Months Ended
|
|||||||
|
Mar. 29,
2015
|
Mar. 30,
2014
|
||||||
|
(millions of dollars)
|
|||||||
Net Sales
|
||||||||
Specialty Minerals
|
$
|
154.0
|
$
|
159.7
|
||||
Refractories
|
73.9
|
84.7
|
||||||
Performance Materials
|
127.9
|
-
|
||||||
Construction Technologies
|
38.9
|
-
|
||||||
Energy Services
|
58.6
|
-
|
||||||
Total
|
$
|
453.3
|
$
|
244.4
|
||||
|
||||||||
Income from Operations
|
||||||||
Specialty Minerals
|
$
|
23.1
|
$
|
21.5
|
||||
Refractories
|
8.3
|
9.2
|
||||||
Performance Materials
|
23.8
|
-
|
||||||
Construction Technologies
|
4.1
|
-
|
||||||
Energy Services
|
5.8
|
-
|
||||||
Total
|
$
|
65.1
|
$
|
30.7
|
Income from operations before
provision for taxes on income
|
||||||||
Three Months Ended
|
||||||||
Mar. 29,
2015
|
Mar. 30,
2014
|
|||||||
(millions of dollars)
|
||||||||
Income from operations for reportable segments
|
$
|
65.1
|
$
|
30.7
|
||||
Acquisition Related Transaction and Integration Costs
|
(3.4
|
)
|
(5.1
|
)
|
||||
Unallocated corporate expenses
|
(1.8
|
)
|
(2.0
|
)
|
||||
Consolidated income from operations
|
59.9
|
23.6
|
||||||
Non-operating deductions, net
|
(12.2
|
)
|
(0.3
|
)
|
||||
Income from continuing operations before provision for taxes on income
|
$
|
47.7
|
$
|
23.3
|
|
Three Months Ended
|
|||||||
|
Mar. 29,
2015 |
Mar. 30,
2014 |
||||||
|
(millions of dollars)
|
|||||||
Paper PCC
|
$
|
105.2
|
$
|
112.8
|
||||
Specialty PCC
|
16.5
|
16.3
|
||||||
Talc
|
13.8
|
13.4
|
||||||
Ground Calcium Carbonate
|
18.5
|
17.2
|
||||||
Refractory Products
|
58.3
|
63.1
|
||||||
Metallurgical Products
|
15.6
|
21.6
|
||||||
Metalcasting
|
65.2
|
-
|
||||||
Household, Personal Care and Specialty Products
|
41.8
|
-
|
||||||
Basic Minerals and Other Products
|
20.9
|
-
|
||||||
Environmental Products
|
11.4
|
-
|
||||||
Building Materials and Other Products
|
27.5
|
-
|
||||||
Energy Services
|
58.6
|
-
|
||||||
Total
|
$
|
453.3
|
$
|
244.4
|
●
|
Develop multiple high-filler technologies, such as filler-fiber, under the FulFill® platform of products, to increase the fill rate in freesheet paper and continue to progress with commercial discussions and full-scale paper machine trials.
|
●
|
Develop products and processes for waste management and recycling, opportunities to reduce the environmental impact of the paper mill, reduce energy consumption and improve the sustainability of the papermaking process.
|
●
|
Further penetration into the packaging segment of the paper industry.
|
●
|
Increase our sales of PCC for paper by further penetration of the markets for paper filling at both freesheet and groundwood mills, particularly in emerging markets.
|
●
|
Expand the Company's PCC coating product line using the satellite model.
|
●
|
Promote the Company's expertise in crystal engineering, especially in helping papermakers customize PCC morphologies for specific paper applications.
|
●
|
Expand PCC produced for paper filling applications by working with industry partners to develop new methods to increase the ratio of PCC for fiber substitutions.
|
●
|
Develop unique calcium carbonate and talc products used in the manufacture of novel biopolymers, a new market opportunity.
|
●
|
Deploy new talc and GCC products in paint, coating and packaging applications.
|
●
|
Deploy value-added formulations of refractory materials that not only reduce costs but improve performance.
|
●
|
Expand our solid core wire product line into BRIC, Middle Eastern and other Asian countries.
|
●
|
Deploy our laser measurement technologies into new applications.
|
●
|
Expand our refractory maintenance model to other steel makers globally.
|
●
|
Increase our presence and gain penetration of our bentonite based foundry customers in emerging markets, such as China and India.
|
●
|
Continue the development of our proprietary Enersol® products for agricultural applications worldwide.
|
|
●
|
Pursue opportunities for our products in environmental and building and construction markets in the Middle East, Asia Pacific and South America regions.
|
●
|
Deploy operational excellence principles into all aspects of the organization, including system infrastructure and lean principles.
|
●
|
Continue to explore selective small bolt-on type acquisitions to fit our core competencies in minerals and fine particle technology.
|
Three Months Ended,
|
Growth
|
|||||||||||||||
Mar. 29
2015
|
Mar. 30
2014
|
$
|
|
%
|
||||||||||||
(Dollars in millions)
|
||||||||||||||||
Net sales
|
$
|
453.3
|
$
|
244.4
|
$
|
208.9
|
85.5
|
%
|
||||||||
Cost of sales
|
336.7
|
189.1
|
147.6
|
78.1
|
%
|
|||||||||||
Production margin
|
116.6
|
55.3
|
61.3
|
110.8
|
%
|
|||||||||||
Production margin %
|
25.7
|
%
|
22.6
|
%
|
||||||||||||
Marketing and administrative expenses
|
45.5
|
21.5
|
24.0
|
111.6
|
%
|
|||||||||||
Research and development expenses
|
5.9
|
5.1
|
0.8
|
15.7
|
%
|
|||||||||||
Amortization expense of intangible assets acquired
|
1.9
|
-
|
1.9
|
*
|
||||||||||||
Acquisition related transaction and integration costs
|
3.4
|
5.1
|
(1.7
|
)
|
-33.3
|
%
|
||||||||||
-
|
||||||||||||||||
Income from operations
|
59.9
|
23.6
|
36.3
|
153.8
|
%
|
|||||||||||
Operating margin %
|
13.2
|
%
|
9.7
|
%
|
||||||||||||
Interest expense, net
|
(15.4
|
)
|
(0.1
|
)
|
(15.3
|
)
|
*
|
|||||||||
Other non-operating income (deductions), net
|
3.2
|
(0.2
|
)
|
3.4
|
*
|
|||||||||||
Total non-operating deductions, net
|
(12.2
|
)
|
(0.3
|
)
|
(11.9
|
)
|
*
|
|||||||||
Income before provision for taxes and equity in earnings
|
47.7
|
23.3
|
24.4
|
104.7
|
%
|
|||||||||||
Provision for taxes on income
|
12.1
|
7.0
|
5.1
|
*
|
||||||||||||
Effective tax rate
|
25.4
|
%
|
30.0
|
%
|
||||||||||||
Equity in earnings of affiliates, net of tax
|
0.4
|
-
|
0.4
|
*
|
||||||||||||
Net income
|
36.0
|
16.3
|
19.7
|
120.9
|
%
|
|||||||||||
Net income attributable to non-controlling interests
|
0.9
|
0.7
|
0.2
|
28.6
|
%
|
|||||||||||
Net income attributable to Minerals Technologies Inc. (MTI)
|
35.1
|
15.6
|
19.5
|
125.0
|
%
|
Three Months Ended
Mar. 29, 2015
|
Three Months Ended
Mar. 30, 2014
|
|||||||||||||||||||
Net Sales
|
% of Total Sales
|
%
Growth |
Net Sales
|
% of Total
Sales
|
||||||||||||||||
(Dollars in millions)
|
||||||||||||||||||||
U.S.
|
$
|
267.9
|
59.1
|
%
|
99.3
|
%
|
$
|
134.4
|
55.0
|
%
|
||||||||||
International
|
185.4
|
40.9
|
%
|
68.5
|
%
|
110.0
|
45.0
|
%
|
||||||||||||
Total sales
|
$
|
453.3
|
100.0
|
%
|
85.5
|
%
|
$
|
244.4
|
100.0
|
%
|
||||||||||
Specialty Minerals Segment
|
$
|
154.0
|
34.0
|
%
|
-3.6
|
%
|
$
|
159.7
|
65.3
|
%
|
||||||||||
Refractories Segment
|
73.9
|
16.3
|
%
|
-12.8
|
%
|
84.7
|
34.7
|
%
|
||||||||||||
Performance Materials Segment
|
127.9
|
28.2
|
%
|
*
|
-
|
*
|
||||||||||||||
Construction Technologies Segment
|
38.9
|
8.6
|
%
|
*
|
-
|
*
|
||||||||||||||
Energy Services Segment
|
58.6
|
12.9
|
%
|
*
|
-
|
*
|
||||||||||||||
Total sales
|
$
|
453.3
|
100.0
|
%
|
85.5
|
%
|
$
|
244.4
|
100.0
|
%
|
Three Months Ended
|
||||||||||||||||
Specialty Minerals Segment |
Mar. 29,
2015 |
Mar. 30,
2014 |
Growth
|
|||||||||||||
(millions of dollars)
|
||||||||||||||||
Net Sales
|
||||||||||||||||
Paper PCC
|
$
|
105.2
|
$
|
112.8
|
$
|
(7.6
|
)
|
-6.7
|
%
|
|||||||
Specialty PCC
|
16.5
|
16.3
|
0.2
|
1.2
|
%
|
|||||||||||
PCC Products
|
$
|
121.7
|
$
|
129.1
|
$
|
(7.4
|
)
|
-5.7
|
%
|
|||||||
Talc
|
$
|
13.8
|
$
|
13.4
|
$
|
0.4
|
3.0
|
%
|
||||||||
Ground Calcium Carbonate
|
18.5
|
17.2
|
1.3
|
7.6
|
%
|
|||||||||||
Processed Minerals Products
|
$
|
32.3
|
$
|
30.6
|
$
|
1.7
|
5.6
|
%
|
||||||||
Total net sales
|
$
|
154.0
|
$
|
159.7
|
$
|
(5.7
|
)
|
-3.6
|
%
|
|||||||
Income from operations
|
$
|
23.1
|
$
|
21.5
|
$
|
1.6
|
7.4
|
%
|
||||||||
% of net sales
|
15.0
|
%
|
13.5
|
%
|
Three Months Ended
|
||||||||||||||||
Refractories Segment
|
Mar. 29,
2015
|
Mar. 30,
2014
|
Growth
|
|||||||||||||
(millions of dollars)
|
||||||||||||||||
Net Sales
|
||||||||||||||||
Refractory Products
|
$
|
58.3
|
$
|
63.1
|
$
|
(4.8
|
)
|
-7.6
|
%
|
|||||||
Metallurgical Products
|
15.6
|
21.6
|
(6.0
|
)
|
-27.8
|
%
|
||||||||||
Total net sales
|
$
|
73.9
|
$
|
84.7
|
$
|
(10.8
|
)
|
-12.8
|
%
|
|||||||
Income from operations
|
$
|
8.3
|
$
|
9.2
|
$
|
(0.9
|
)
|
-9.8
|
%
|
|||||||
% of net sales
|
11.2
|
%
|
10.9
|
%
|
Performance Materials Segment
|
Three Months Ended
Mar. 29, 2015 |
|||
(millions of dollars)
|
||||
Net Sales
|
||||
Metalcasting
|
$
|
65.2
|
||
Household, Personal Care and Specialty Products
|
41.8
|
|||
Basic Minerals and Other Products
|
20.9
|
|||
Total net sales
|
$
|
127.9
|
||
Income from operations
|
$
|
23.8
|
||
% of net sales
|
18.6
|
%
|
Construction Technologies Segment
|
Three Months Ended
Mar. 29, 2015 |
|||
(millions of dollars)
|
||||
Net Sales
|
||||
Environmental Products
|
$
|
11.4
|
||
Building Materials and Other Products
|
27.5
|
|||
Total net sales
|
$
|
38.9
|
||
Income from operations
|
$
|
4.1
|
||
% of net sales
|
10.5
|
%
|
Energy Services Segment
|
Three Months Ended
Mar. 29, 2015 |
|||
(millions of dollars)
|
||||
Net Sales
|
$
|
58.6
|
||
Income from operations
|
$
|
5.8
|
||
% of net sales
|
9.9
|
%
|
Exhibit No.
|
Exhibit Title
|
||
10.1
|
Fifth Amendment to Employment Agreement, dated February 27, 2015, by and between Joseph C. Muscari and the Company (incorporated by reference to the Exhibit 10.1 filed with the Company's Current Report on form 8-K filed on March 5, 2015).
|
||
Letter Regarding Unaudited Interim Financial Information.
|
|||
Rule 13a-14(a)/15d-14(a) Certification executed by the Company's principal executive officer.
|
|||
Rule 13a-14(a)/15d-14(a) Certification executed by the Company's principal financial officer.
|
|||
Section 1350 Certifications.
|
|||
Information concerning Mine Safety Violations
|
|||
Risk Factors
|
|||
101.INS
|
XBRL Instance Document
|
||
101.SCH
|
XBRL Taxonomy Extension Schema
|
||
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
||
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
||
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
|
||
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase
|
Minerals Technologies Inc. | ||
By:
|
/s/Douglas T. Dietrich
|
|
Douglas T. Dietrich
|
||
Senior Vice President, Finance and Treasury,
|
||
Chief Financial Officer
|
Re:
|
Registration Statement Nos. 333-160002, 33-59080, 333-62739 and 333-138245
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Minerals Technologies Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors:
|
By:
|
/s/Joseph C. Muscari
|
||
Joseph C. Muscari
|
|||
Chairman of the Board
|
|||
and Chief Executive Officer |
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Minerals Technologies Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors:
|
By:
|
/s/Douglas T. Dietrich
|
||
Douglas T. Dietrich
|
|||
Senior Vice President, Finance and Treasury,
|
|||
Chief Financial Officer
|
By:
|
/s/Joseph C. Muscari
|
||
Joseph C. Muscari
|
|||
Chairman of the Board
|
|||
and Chief Executive Officer |
By:
|
/s/Douglas T. Dietrich
|
||
Douglas T. Dietrich
|
|||
Senior Vice President, Finance and Treasury,
|
|||
Chief Financial Officer
|
Mine
|
Section
104(a)
S&S
|
Section
104(b)
|
Section
104(d)
|
Section
110(b)(2)
|
Section
107(a)
|
Proposed
Assessments
|
Fatalities
|
||||||||||||||
(A)
|
(B)
|
(C)
|
(D)
|
(E)
|
(F)
|
(G)
|
|||||||||||||||
Lucerne Valley, CA
|
0
|
0
|
0
|
0
|
0
|
$0
|
0
|
||||||||||||||
Canaan, CT
|
4
|
0
|
0
|
0
|
0
|
$4,552
|
0
|
||||||||||||||
Adams, MA
|
3
|
0
|
0
|
0
|
0
|
$2,217*
|
|
0
|
|||||||||||||
Barretts Mill, Dillon, MT
|
2
|
0
|
0
|
0
|
0
|
$787
|
0
|
||||||||||||||
Regal Mine, Dillon, MT
|
0
|
0
|
0
|
0
|
0
|
$0
|
0
|
||||||||||||||
Treasure Mine, Dillon, MT
|
0
|
0
|
0
|
0
|
0
|
$0
|
0
|
||||||||||||||
Belle/Colony Mine, WY
|
0
|
0
|
0
|
0
|
0
|
$343
|
0
|
||||||||||||||
Belle Fourche Mill, SD
|
0
|
0
|
0
|
0
|
0
|
$0
|
0
|
||||||||||||||
Colony East, WY
|
3
|
0
|
0
|
0
|
0
|
*
|
0
|
||||||||||||||
Colony West, WY
|
0
|
0
|
0
|
0
|
0
|
*
|
0
|
||||||||||||||
Gascoyne, ND
|
0
|
0
|
0
|
0
|
0
|
$190
|
0
|
||||||||||||||
Lovell, WY
|
0
|
0
|
0
|
0
|
0
|
$0
|
0
|
||||||||||||||
Sandy Ridge, AL
|
0
|
0
|
0
|
0
|
0
|
$0
|
0
|
||||||||||||||
Yellowtail, WY
|
0
|
0
|
0
|
0
|
0
|
$0
|
0
|
* | As of the date of this report, we have not received proposed assessments for certain violations issued during this period for this location. |
(A) | The total number of violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of a mine safety or health hazard under section 104 of the Mine Act for which we received a citation from MSHA. |
(B) | The total number of orders issued under section 104(b) of the Mine Act. |
(C) | The total number of citations and orders for unwarrantable failure of the Company to comply with mandatory health or safety standards under section 104(d) of the Mine Act. |
(D) | The total number of flagrant violations under section 110(b)(2) of the Mine Act. |
(E) | The total number of imminent danger orders issued under section 107(a) of the Mine Act. |
(F) | The total dollar value of proposed assessments from MSHA under the Mine Act. |
(G) | The total number of mining-related fatalities, other than fatalities determined by MSHA to be unrelated to mining activity. |
Mine
|
Legal Actions
Pending As Of
Last Day
Of Period (1)
|
Legal Actions
Initiated During
Period
|
Legal Actions
Resolved
During Period
|
Lucerne Valley, CA
|
0
|
0
|
0
|
Canaan, CT
|
0
|
0
|
0
|
Adams, MA
|
21
|
21
|
0
|
Barretts Mill, Dillon, MT
|
0
|
0
|
0
|
Regal Mine, Dillon, MT
|
0
|
0
|
0
|
Treasure Mine, Dillon, MT
|
0
|
0
|
0
|
Belle/Colony Mine, WY
|
0
|
0
|
0
|
Belle Fourche Mill, SD
|
0
|
0
|
0
|
Colony East, WY
|
2
|
0
|
0
|
Colony West, WY
|
1
|
0
|
0
|
Gascoyne, ND
|
0
|
0
|
0
|
Lovell, WY
|
0
|
0
|
0
|
Sandy Ridge, AL
|
0
|
0
|
0
|
Yellowtail, WY
|
0
|
0
|
0
|
●
|
Worldwide general economic, business, and industry conditions have had, and may continue to have, an adverse effect on the Company's results.
|
●
|
Our customers' businesses are cyclical or have changing regional demands. Our operations are subject to these trends and we may not be able to mitigate these risks.
|
●
|
Our Performance Materials segment's sales are predominantly derived from the metalcasting market. The metalcasting market is dependent upon the demand for castings for automobile components, farm and construction equipment, oil and gas production equipment, power generation turbine castings, and rail car components. Many of these types of equipment are sensitive to fluctuations in demand during periods of recession or tough economies, which ultimately may affect the demand for our construction technologies and performance materials segments' products and services.
|
● |
In the paper industry, which is served by our Paper PCC product line, production levels for uncoated freesheet within North America and Europe, our two largest markets are projected to continue to decrease. The reduced demand for premium writing paper products has also caused the paper industry to experience a number of recent bankruptcies and paper mill closures, including among our customers.
|
● |
Our Refractories segment primarily serves the steel industry. North American and European steel production continues to be affected by global volatility and overcapacity in the market.
|
●
|
Our customers' demand for our Energy Services segment's products and services are affected by oil and natural gas production activities, which are heavily influenced by the benchmark price of these commodities. Oil and natural gas prices decreased significantly in 2014, which we expect will cause exploration companies to reduce their capital expenditures and production and exploration activities. This has the effect of decreasing the demand and increasing competition for the services we provide. In addition, oil and natural gas exploration and production activities depend heavily on the location of these natural resources within the earth's geology and geographic location as well as technologies available to profitably extract them. Thus, the performance of our Energy Services segment is affected by changes in technologies, locations of customers' targeted reserves, and competition in various geographic markets.
|
● |
Our Construction Technologies segment's sales are predominantly derived from the commercial construction and infrastructure markets. In addition, our Processed Minerals and Specialty PCC product lines are affected by the domestic building and construction markets as well as the automotive market.
|
●
|
TThe Company's results could be adversely affected if it is unable to effectively achieve and implement its growth initiatives.
|
● |
The acquisition of AMCOL International Corporation exposes the Company to a number of risks and uncertainties, the occurrence of any of which could materially adversely affect the Company or the future results of the combined company.
|
●
|
that we have incurred and may continue to incur a number of non-recurring costs associated with combining the operations of the Company and AMCOL;
|
● |
that the combined company has undergone, and is expected to continue to undergo, certain internal restructurings and reorganizations in order to realize certain potential synergies, which may affect our ability to maintain our relationships with customers and suppliers, retain key personnel, avoid diversion of management's attention from operational matters, and efficiently integrate general and administrative services; and
|
● |
that the combined company may not be able to achieve the synergies expected from the transaction, or that there may be delays in achieving any such synergies.
|
●
|
Servicing the Company's debt will require a significant amount of cash. This could reduce the Company's flexibility to respond to changing business and economic conditions or fund capital expenditures or working capital needs. Our ability to generate cash depends on many factors beyond our control.
|
●
|
Our senior secured credit facility contains various covenants that limit our ability to take certain actions and our revolving credit facility, if used, also requires us to meet financial maintenance tests, failure to comply with which could have a material adverse effect on us.
|
●
|
TThe Company's sales of PCC could be adversely affected by our failure to renew or extend long term sales contracts for our satellite operations.
|
●
|
The Company's sales could be adversely affected by consolidation in customer industries, principally paper, foundry and steel.
|
●
|
The Company is subject to stringent regulation in the areas of environmental, health and safety, and tax, and may incur unanticipated costs or liabilities arising out of claims for various legal, environmental and tax matters or product stewardship issues.
|
●
|
Delays or failures in new product development could adversely affect the Company's operations.
|
● |
The Company's ability to compete is dependent upon its ability to defend its intellectual property against inappropriate disclosure and infringement.
|
●
|
The Company's operations could be impacted by the increased risks of doing business abroad.
|
●
|
The Company's operations are dependent on the availability of raw materials and access to ore reserves at its mining operations. Increases in costs of raw materials, energy, or shipping could adversely affect our financial results.
|
● |
The Company operates in very competitive industries, which could adversely affect our profitability.
|
●
|
PProduction facilities are subject to operating risks and capacity limitations that may adversely affect the Company's financial condition or results of operations.
|
● |
Operating Results for some of our segments are seasonal.
|
Contingencies
|
3 Months Ended | ||
---|---|---|---|
Mar. 29, 2015
|
|||
Contingencies [Abstract] | |||
Contingencies |
We are party to a number of lawsuits arising in the normal course of our business. On May 8, 2013, Armada (Singapore) PTE Limited, an ocean shipping company now in bankruptcy ("Armada") filed a case in federal court in the Northern District of Illinois against AMCOL and certain of its subsidiaries (Armada (Singapore) PTE Limited v. AMCOL International Corp., et al., United States District Court for the Northern District of Illinois, Case No. 13 CV 3455). We acquired AMCOL and its subsidiaries on May 9, 2014. A co-defendant is Ashapura Minechem Limited, a company located in Mumbai, India (“AML”). During the relevant time period, 2008-2010, AMCOL owned slightly over 20% of the outstanding AML stock through December 2009, after which it owned approximately 19%. In 2008, AML entered into two contracts of affreightment (“COA”) with Armada for over 60 ship loads of bauxite from India to China. After one shipment, AML made no further shipments, which led Armada to file arbitrations in London against AML, one for each COA. AML did not appear in the London arbitrations and default awards of approximately $70 million were entered. The litigation filed by Armada against AMCOL and AML relates to these awards, which AML has not paid. The substance of the allegations by Armada is that AML and AMCOL engaged in illegal conduct to thwart Armada’s efforts to collect the arbitration award. The counts in the complaint include both violations of the Illinois Fraudulent Transfer laws as well as federal RICO violations. The lawsuit seeks money damages as well injunctive relief. The litigation is in the discovery phase. Fact discovery and expert discovery is currently scheduled to last through June 12, 2015. At this time, considering this case is in the discovery phase, management cannot estimate potential losses (if any) and therefore has not established any provisions. The Company’s Construction Technologies segment is respondent in an arbitration requested by Bentonit Uniăo Nordeste Indústria e Comércio Ltda. (“BUN”), the Company’s joint venture partner in Brazil, alleging a breach of the joint venture agreement and claiming, among other things, damages in the amount of 34 million Brazilian real. Written closing arguments have been submitted to the arbitration panel and the Company believes that the BUN claim is unsubstantiated. At this time management anticipates that the amount of the Company's liability, if any, will not have a material effect on its financial position or results of operations. Certain of the Company's subsidiaries are among numerous defendants in a number of cases seeking damages for exposure to silica or to asbestos containing materials. The Company currently has 77 pending silica cases and 13 pending asbestos cases. These totals include 5 silica cases against AMCOL International Corporation and/or its subsidiary, American Colloid Company, that were pending on the date we acquired AMCOL. To date, 1,419 silica cases and 42 asbestos cases have been dismissed, not including any lawsuits against AMCOL or American Colloid Company dismissed prior to our acquisition of AMCOL. Three new asbestos cases and no new silica cases were filed in the first quarter of 2015. Three asbestos cases, including the only one against AMCOL International Corporation, and twenty-five silica cases against AMCOL International Corporation were dismissed during the first quarter of 2015. Most of these claims do not provide adequate information to assess their merits, the likelihood that the Company will be found liable, or the magnitude of such liability, if any. Additional claims of this nature may be made against the Company or its subsidiaries. At this time management anticipates that the amount of the Company's liability, if any, and the cost of defending such claims, will not have a material effect on its financial position or results of operations. The Company has settled only one silica lawsuit, for a nominal amount, and no asbestos lawsuits to date (not including any that may have been settled by AMCOL prior to completion of the acquisition). We are unable to state an amount or range of amounts claimed in any of the lawsuits because state court pleading practices do not require identifying the amount of the claimed damage. The aggregate cost to the Company for the legal defense of these cases since inception continues to be insignificant. The majority of the costs of defense for these cases, excluding cases against AMCOL or American Colloid, are reimbursed by Pfizer Inc. pursuant to the terms of certain agreements entered into in connection with the Company's initial public offering in 1992. Of the 13 pending asbestos cases all allege liability based on products sold largely or entirely prior to the initial public offering, and for which the Company is therefore entitled to indemnification pursuant to such agreements. Our experience has been that the Company is not liable to plaintiffs in any of these lawsuits and the Company does not expect to pay any settlements or jury verdicts in these lawsuits. Environmental Matters On April 9, 2003, the Connecticut Department of Environmental Protection issued an administrative consent order relating to our Canaan, Connecticut, plant where both our Refractories segment and Specialty Minerals segment have operations. We agreed to the order, which includes provisions requiring investigation and remediation of contamination associated with historic use of polychlorinated biphenyls ("PCBs") and mercury at a portion of the site. We have completed the required investigations and submitted several reports characterizing the contamination and assessing site-specific risks. We are awaiting regulators’ approval of the risk assessment report, which will form the basis for a proposal by the Company concerning eventual remediation. We believe that the most likely form of overall site remediation will be to leave the existing contamination in place (with some limited soil removal), encapsulate it, and monitor the effectiveness of the encapsulation. We anticipate that a substantial portion of the remediation cost will be borne by the United States based on its involvement at the site from 1942 – 1964, as historic documentation indicates that PCBs and mercury were first used at the facility at a time of U.S. government ownership for production of materials needed by the military. Pursuant to a Consent Decree entered on October 24, 2014, the United States paid the Company $2.3 million in the 4th quarter of 2014 to resolve the Company’s claim for response costs for investigation and initial remediation activities at this facility through October 24, 2014. Contribution by the United States to any future costs of investigation or additional remediation has, by agreement, been left unresolved. Though the cost of the likely remediation remains uncertain pending completion of the phased remediation decision process, we have estimated that the Company’s share of the cost of the encapsulation and limited soil removal described above would approximate $0.4 million, which has been accrued as of March 29, 2015. The Company is evaluating options for upgrading the wastewater treatment facilities at its Adams, Massachusetts plant. This work has been undertaken pursuant to an administrative Consent Order originally issued by the Massachusetts Department of Environmental Protection (“DEP”) on June 18, 2002. This order was amended on June 1, 2009 and on June 2, 2010. The amended Order includes the investigation by January 1, 2022 of options for ensuring that the facility's wastewater treatment ponds will not result in unpermitted discharge to groundwater. Additional requirements of the amendment include the submittal by July 1, 2022 of a plan for closure of a historic lime solids disposal area. Preliminary engineering reviews completed in 2005 indicate that the estimated cost of wastewater treatment upgrades to operate this facility beyond 2024 may be between $6 million and $8 million. The Company estimates that the remaining remediation costs would approximate $0.4 million, which has been accrued as of March 29, 2015. The Company and its subsidiaries are not party to any other material pending legal proceedings, other than routine litigation incidental to their businesses. |
+)S)O.@TD( 60
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