PolyOne Corporation (NYSE:POL) today reported its third quarter results for 2016. GAAP earnings per share was $0.50 in both the third quarter of 2016 and the third quarter of 2015. Adjusted earnings per share increased 4% to $0.56, from $0.54 in the third quarter of 2015. Special items for the third quarter of 2016, which primarily included realignment and acquisition-related costs, resulted in a net after-tax charge of $4.7 million, or $0.06 per share (see Attachment 1). In the prior year quarter, special items, which primarily included realignment charges and a tax benefit, resulted in a net after-tax charge of $3.0 million, or $0.04 per share.
“I’m pleased we overcame challenging macro-economic conditions to deliver our 28th consecutive quarter of adjusted earnings per share expansion – representing seven straight years of growth,” said Robert M. Patterson, chairman, president, and chief executive officer, PolyOne Corporation. “This quarter, our Specialty Engineered Materials, Performance Products & Solutions (PP&S) and Distribution segments led the way, as all three achieved year-over-year increases in operating income.”
Revenue for the third quarter of 2016 rose to $844 million, compared to $842 million in the third quarter of 2015. Underlying organic sales growth, plus contributions from the company’s recently acquired businesses, offset lower year-over-year selling prices in Distribution, PP&S, and Designed Structures and Solutions (DSS), due to lower hydro-carbon based raw material costs.
Bradley C. Richardson, executive vice president and chief financial officer, PolyOne Corporation, said, “Our balance sheet and cash flow remain strong, and they continue to provide us with flexibility to invest in strategic initiatives and return cash to shareholders. During the quarter we repurchased 318,000 shares of common stock and increased our Term Loan B by $100 million to fund the acquisitions of Gordon Composites and Polystrand, all while maintaining a modest leverage ratio of 2.5x net debt to adjusted EBITDA. In addition, we recently announced a 12.5% increase in our annual dividend to $0.54 – our sixth consecutive annual increase.”
“Within the last year, we have acquired four excellent specialty businesses that bolstered our technology portfolio,” Mr. Patterson added. “The integration and growth prospects of these businesses are on track. Feedback from our new customers has been outstanding, and I have heard first-hand they are excited to leverage the comprehensive suite of polymer solutions we offer.”
“Our broad and expansive specialty solutions, coupled with exemplary service offerings such as InVisiO, IQ Design and LSS Customer First, are important competitive differentiators for us. Leveraging our unique strengths is more important now than ever with weak demand in a number of end markets and regions,” Mr. Patterson said.
Commenting on the company’s outlook, Mr. Patterson added, “As we discussed on our last earnings call, we expected the second half of the year to be more challenging due to an absence of macro-economic tailwinds, fallout from Brexit, and a weaker British pound to name a few, and that is what is playing out. Regardless of the factors outside our direct control, we remain focused on relentlessly executing our four-pillar strategy, collaborating with our customers, and investing in our businesses and employees.”
About PolyOne
PolyOne Corporation, with 2015 revenues of $3.4 billion, is a premier provider of specialized polymer materials, services and solutions. The company is dedicated to serving customers in diverse industries around the globe, by creating value through collaboration, innovation and an unwavering commitment to excellence. Guided by its Core Values, Sustainability Promise and No Surprises PledgeSM, PolyOne is committed to its customers, employees, communities and shareholders through ethical, sustainable and fiscally responsible principles. For more information, visit www.polyone.com.
