PolyOne to Exit Nevada Engineered Films Plant
March 26, 2003
CLEVELAND, Mar 26, 2003 /PRNewswire-FirstCall via COMTEX/ -- PolyOne
Corporation (NYSE: POL) announced today that it intends to close its Engineered
Films plant in Yerington, Nevada, by the end of second-quarter 2003 if the
Company is unable to quickly sell the facility as an ongoing operation.
Yerington, one of four plants within PolyOne's Engineered Films unit, employs
approximately 85 people.
"Yerington has an excellent record of customer satisfaction, but we need to
reduce excess production capacity and realign PolyOne's product portfolio to
available capacity," said Thomas A. Waltermire, chairman and chief executive
officer. "We are responding to the continuing slowdown in sales demand for
certain custom film products, as well as low margins in a number of the
Yerington produces a variety of film products, including film for bookbinder
covers. While PolyOne intends to carefully transition a number of its Yerington
products to other Engineered Films facilities in either New Jersey, Pennsylvania
or Virginia, it will also cease manufacturing certain products with low margins.
PolyOne projects that closing the Yerington plant would yield an annualized
pre-tax earnings improvement of $1.8 million because reduced plant costs exceed
the variable margin on exited sales. Further, PolyOne would monetize an
estimated $5 million of commercial working capital and property and building.
Restructuring costs are projected to total $6.3 million, of which $2.8 million
would be cash closure costs. The Company estimates the pre-tax earnings charge
in the first and second quarters of 2003 would be approximately $4.5 million and
$1.5 million, respectively.
Employees affected by a Yerington closing would be eligible for severance
benefits and outplacement services, and also would be eligible to apply for any
job openings at other locations within the Engineered Films business group.
PolyOne Corporation, with 2002 revenues of $2.5 billion, is an international
polymer services company with operations in thermoplastic compounds, specialty
resins, specialty polymer formulations, engineered films, color and additive
systems, elastomer compounding and thermoplastic resin distribution.
Headquartered in Cleveland, Ohio, PolyOne has employees at manufacturing sites
in North America, Europe, Asia and Australia, and joint ventures in North
America, South America, Europe, Asia and Australia. Information on the Company's
products and services can be found at www.polyone.com .
In this press release, statements that are not reported financial results or
other historical information are "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. Forward- looking
statements give current expectations or forecasts of future events and are not
guarantees of future performance. They are based on management's expectations
that involve a number of business risks and uncertainties, any of which could
cause actual results to differ materially from those expressed in or implied by
the forward-looking statements. You can identify these statements by the fact
that they do not relate strictly to historic or current facts. They use words
such as "anticipate," "estimate," "expect," "project," "intend," "plan,"
"believe" and other words and terms of similar meaning in connection with any
discussion of future operating or financial performance. In particular, these
include statements relating to future actions; prospective changes in raw
material costs, product pricing or product demand; future performance or results
of current and anticipated market conditions and market strategies; sales
efforts; expenses; the outcome of contingencies such as legal proceedings; and
financial results. Factors that could cause actual results to differ materially
include, but are not limited to: (1) an inability to achieve or delays in
achieving estimated and actual savings related to restructuring programs; (2)
delays in achieving or inability to achieve the Company's strategic value
capture initiatives, including cost reduction and employee productivity goals,
or achievement of less than the anticipated financial benefit from the
initiatives; (3) the effect on foreign operations of currency fluctuations,
tariffs, nationalization, exchange controls, limitations on foreign investment
in local businesses and other political, economic and regulatory risks; (4)
changes in U.S., regional or world polymer and/or rubber consumption growth
rates affecting the Company's markets; (5) changes in global industry capacity
or in the rate at which anticipated changes in industry capacity come online in
the polyvinyl chloride (PVC), chlor-alkali, vinyl chloride monomer (VCM) or
other industries in which the Company participates; (6) fluctuations in raw
material prices, quality and supply and in energy prices and supply, in
particular fluctuations outside the normal range of industry cycles; (7)
production outages or material costs associated with scheduled or unscheduled
maintenance programs; (8) costs or difficulties and delays related to the
operation of joint venture entities; (9) lack of day-to-day operating control,
including procurement of raw materials, of equity or joint venture affiliates;
(10) partial control over investment decisions and dividend distribution policy
of the OxyVinyls partnership and other minority equity holdings of the Company;
(11) an inability to launch new products and/or services that strategically fit
the Company's businesses; (12) the possibility of goodwill impairment; (13) an
inability to maintain any required licenses or permits; (14) an inability to
comply with any environmental laws and regulations; (15) a delay or inability to
achieve targeted debt levels through divestitures or other means; and (16) a
delay or inability to replace the Company's current receivables sale facility by
June 30, 2003.
We cannot guarantee that any forward-looking statement will be realized,
although we believe we have been prudent in our plans and assumptions.
Achievement of future results is subject to risks, uncertainties and inaccurate
assumptions. Should known or unknown risks or uncertainties materialize, or
should underlying assumptions prove inaccurate, actual results could vary
materially from those anticipated, estimated or projected. Investors should bear
this in mind as they consider forward-looking statements.
We undertake no obligation to publicly update forward-looking statements,
whether as a result of new information, future events or otherwise. You are
advised, however, to consult any further disclosures we make on related subjects
in our Form 10-Q, 8-K and 10-K reports to the Securities and Exchange
Commission. You should understand that it is not possible to predict or identify
all such factors. Consequently, you should not consider any such list to be a
complete set of all potential risks or uncertainties.
SOURCE PolyOne Corporation
CONTACT: Media & Investors, Dennis Cocco, Vice President Investor
Relations & Communications of PolyOne Corporation, +1-216-589-4018