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PolyOne Reports Results for Third-Quarter 2003

October 29, 2003

- Current-quarter operating results in line with Company expectations - North American operations reflect weak economic conditions in July and August - Actions to reduce working capital result in significant cash flow improvement - Company executing financial improvement actions in third and fourth quarters

CLEVELAND, Oct 29, 2003 /PRNewswire-FirstCall via COMTEX/ -- PolyOne Corporation
(NYSE: POL), a leading global polymer services company, today reported sales
of $630.3 million for the quarter ended September 30, 2003, a decrease of
$20.6 million, or 3 percent, from the 2003 second quarter. PolyOne had
operating income of $6.9 million for the 2003 third quarter compared with
operating income of $10.8 million in the second quarter. For third-quarter
2002, PolyOne reported sales of $650.7 million and operating income of
$26.3 million.

Operating income before special items was $16.3 million in the third
quarter of 2003 compared with $14.2 million in the 2003 second quarter and
$31.6 million in the third quarter of 2002. Excluding special items,
operating income in third-quarter 2003 improved from the 2003 second quarter
by $2.1 million, despite softer sales. A schedule of special items and a
reconciliation of operating income before special items to operating income
are included in the attached Exhibit 1 and Exhibit 2. The 2003 third-quarter
operating results, excluding the effects of special items, are in line with
PolyOne's July 29, 2003, outlook for third-quarter results.

"We are encouraged that we were able to improve operating margins through
our internal efforts to lower costs and cash flow, primarily through a
significant reduction in our inventory," said Thomas A. Waltermire, PolyOne
chairman and chief executive officer. "Our lower cost structure, coupled with
improved sales demand toward the end of the quarter, made us profitable in
September and is providing some momentum as we move into the fourth quarter."

Beginning late in the second quarter of 2003 and continuing into the third
quarter, the Company took additional actions to streamline and simplify
operations and to raise manufacturing operating rates. As a result, the 2003
third quarter includes special charges of $9.4 million pre tax for employee
separations and plant closing costs.

During the 2003 third quarter, the Company recognized certain tax items
that affect income tax expense and shareholders' equity, but do not impact
PolyOne's net cash flow or liquidity.

In accordance with Statement of Financial Accounting Standards No.109,
"Accounting for Income Taxes," the Company determined that it must reduce the
value of its tax credits because it has been losing money in the United States
operations. As a result, the Company recognized non-cash income tax expense
of $9.0 million, or $0.10 per share, in the 2003 third-quarter results to
reduce the value of its tax credits. The accumulated valuation allowance for
income taxes was $41.4 million at September 30, 2003. Once the Company
returns to profitability in the U.S., the credits will be restored.

In addition, during the 2003 third quarter, the Company recorded a federal
tax expense of $24.0 million, or $0.26 per share, for dividends to be paid by
foreign subsidiaries as a result of certain tax planning strategies. This
provision relates to repatriation of funds to the U. S., and should have no
significant impact on PolyOne's overall liquidity.

Third-Quarter 2003 Business Highlights

  • Strengthened balance sheet: PolyOne made solid progress in reducing
    inventories and working capital investment. The result was a reduction
    of $25.4 million in net borrowing under the receivables sale facility
    in the third quarter of 2003.
  • Debt reduction: PolyOne announced in October 2003 that its future focus
    would be on its global Plastics Compounding and Color & Additive
    Masterbatch business operations and its Distribution business. These
    operations have the strongest market synergies and potential for
    success. PolyOne's other business operations -- Elastomers and
    Performance Additives, Engineered Films and Specialty Resins -- are
    being considered for divestment. Proceeds from the sales of these
    businesses would be used to reduce debt. The Company has set no
    deadline for divesting these business operations, which in 2002 had
    $617 million of PolyOne's $2.5 billion in sales. For the first nine
    months of 2003, these businesses had an operating loss before special
    charges of $7.2 million.
  • Improving business margins: During the 2003 third quarter, management
    accelerated a number of programs to improve the performance of the
    North American operations. These programs included: segmenting the
    customer base to improve service and profitability, focusing sales
    resources more effectively on customers who can drive growth,
    streamlining costs for smaller transactions and emphasizing individual
    performance in sales force compensation. Further, as part of the
    ongoing effort to reduce PolyOne's selling and administrative costs to
    less than 10 percent of sales, approximately 170 positions were
    eliminated in a number of business operations and functional support
    departments.
  • Alignment of capacity with demand: As part of an objective to reduce
    costs through improved manufacturing efficiencies, PolyOne closed its
    color additives plant in Fort Worth, Texas, in August 2003 and
    transferred production to other color plants with available capacity.
    The Company also reduced the work schedule from seven to five days at
    most of its vinyl compounding plants. Additionally, PolyOne closed two
    production lines at its Macedonia, Ohio, engineered materials plant.
    Altogether, these actions reduced PolyOne's workforce by approximately
    100 employees.
  • Expansion approved for China: To further strengthen PolyOne's global
    position, the Board of Directors recently approved plans to build a new
    masterbatch and compound plant in China - the Company's third plant in
    China and fifth in Asia. PolyOne anticipates that the facility will
    begin operations in late 2004. Currently, Asia accounts for about 3
    percent of PolyOne's sales.

Business Segment Performance Highlights

Performance Plastics: Third-quarter 2003 operating income, excluding
special charges, improved $3.6 million, or 49 percent, compared with the
second quarter of 2003, principally as a result of previous cost reduction
actions. This improvement occurred despite a sales decrease of 3 percent over
the same period. Overall, shipments decreased 2 percent in the third quarter
compared with the second quarter as strong demand in September only partially
offset lackluster business in July and August. The exception was the Asian
operations, which recovered from SARS-related issues in the second quarter of
2003 and increased shipments 9 percent from the second quarter.

Elastomers and Performance Additives: Sales and shipments decreased
3 percent and 1 percent, respectively, in the third quarter of 2003 compared
with the 2003 second quarter, principally because of a decline in automotive
demand. Customer sales, however, improved during September from July and
August levels.

Distribution: A slow July and August resulted in a 4 percent decline in
sales from the 2003 second quarter to the third quarter of 2003. Shipments,
however, were unchanged over the same period. Product mix contributed to the
difference as shipments of lower-priced commodity-grade resins improved in the
third quarter.

Resin and Intermediates: Earnings from equity affiliates were essentially
flat in the third quarter of 2003 compared with the 2003 second quarter.
These better-than-anticipated results were driven principally by strong sales
demand for polyvinyl chloride (PVC) resin, which boosted shipments from Oxy
Vinyls, LP by approximately 16 percent over the previous quarter.


                    Summary of Third-Quarter 2003 Results
                 (Dollars in millions, except per share data)

                                        3Q03            2Q03          3Q02

    Sales                              $630.3          $650.9        $650.7

    Operating income                      6.9            10.8          26.3
    Operating income, before special
     items                               16.3            14.2          31.6
    Income (loss) before discontinued
     operations and cumulative effect
     of a change in accounting          (43.2)           (6.0)         (6.0)
    Net income (loss)                  $(43.2)          $(6.0)         $9.8

    Income (loss) per share, diluted   $(0.47)         $(0.07)        $0.11
    Income (loss) per share before
     discontinued operations and
     effect of a change in accounting   (0.47)          (0.07)         0.11

    Per share effect of excluding
     special items, increase             0.43            0.03          0.04


                     Summary of Year-to-Date 2003 Results
                 (Dollars in millions, except per share data)

                                                  9 mo. 2003     9 mo. 2002

    Sales                                           $1,926.7       $1,917.9

    Operating income                                     1.5           52.3
    Operating income, before special items              40.9           62.0
    Income (loss) before discontinued operations
     and cumulative effect of a change in accounting   (68.5)          11.0
    Net income (loss)                                 $(68.5)        $(41.4)

    Income (loss) per share, diluted                  $(0.75)        $(0.45)
    Income (loss) per share before discontinued
     operations and effect of a change in
     accounting                                        (0.75)          0.12

    Per share effect of excluding special
     items, increase                                    0.64           0.07

Fourth-Quarter 2003 Business Outlook

In North America, where there are modest signs of economic recovery,
customer sales demand strengthened in September from weakness in July and
August. This improved sales demand carried over to early October. While
sales demand in the second half of the fourth quarter is very difficult to
project, PolyOne estimates that North American 2003 fourth-quarter sales will
be seasonally slower and could approximate 2002 fourth-quarter levels.
International sales are expected to increase 10 to 15 percent over the same
period, driven principally by the Transcolor acquisition.

For PolyOne's operating businesses (total Company less the Resin and
Intermediates segment), 2003 fourth-quarter prices and raw material costs are
expected to remain unchanged from the third quarter of 2003. Selling and
administrative costs are expected to be lower in the fourth quarter versus the
previous quarter.

PVC resin sales demand in the 2003 fourth quarter is forecasted to be
seasonally lower than 2003 third-quarter levels, but ahead of fourth-quarter
2002 levels. Average industry PVC resin selling prices are projected to
approximate the 2003 third quarter. As a result of projected raw material
increases, PVC resin industry spreads could decrease compared with the third
quarter of 2003.

Chlor-alkali demand is also projected to be seasonally down in the 2003
fourth quarter compared with the third quarter of 2003. The combination of
anticipated lower sales demand and resin spreads results in a projected
reduction of $3 million to $5 million in operating income before any special
items for the Resin and Intermediates segment in the fourth quarter compared
with the third quarter of 2003.

Special items pre-tax expense in the fourth quarter of 2003 is projected
to be approximately $12 million for restructuring actions initiated to date,
including the Elastomers and Performance Additives plant closings announced
separately today. For the three non-core businesses that may be divested, an
assessment of potential asset impairment will occur in the 2003 fourth
quarter; results are unknown at this time. Also, the fourth-quarter after-tax
special items will include a tax valuation allowance related to the fourth-
quarter domestic operating losses.

The cumulative result of these factors (seasonally lower revenues and
projected lower Resin and Intermediates equity earnings, partially offset by
reduced overhead costs) is that PolyOne expects a fourth-quarter 2003 loss of
$0.32 to $0.42 per share, and a loss before special items of $0.08 to $0.14
per share. Before special items, the 2003 fourth-quarter operating loss is
expected to be from $0.02 to $0.08 per share better than the comparable 2002
fourth-quarter amount.

Despite this earnings outlook, the Company expects to generate positive
cash flow in the 2003 fourth quarter, largely as a result of ongoing efforts
to further reduce its working capital and reduced seasonal requirements.

"Because we remain cautious about a rebound in the economy, we are taking
additional cost reduction actions that should benefit the 2003 fourth quarter
and return the overall business to profitability in 2004," said Waltermire.
"We are taking the necessary steps to bring our cost structure in line with
current demand and to reduce our working capital needs structurally. These
steps, plus our recent decision to make available for divestment businesses
totaling more than $600 million in sales, are being taken to focus our Company
on its strengths, improve our operating results and strengthen our balance
sheet."

Supplemental Information

The Company makes available additional information regarding its
performance, as well as information on key drivers of its operating results.
This information will be posted today on its Web site at www.polyone.com in
the corporate investor relations section under the listing "Supplements." The
supplemental information also can be obtained, once available, from the
contact listed below.

PolyOne Third-Quarter 2003 Conference Call

PolyOne will host a conference call at 9 a.m. Eastern time on October 30,
2003. The conference dial-in number is 888-489-0038 (domestic) or
706-643-1611 (international), conference topic: PolyOne Earnings Call. The
replay number is 800-642-1687 (domestic) or 706-645-9291 (international). The
conference ID for the replay is 6571867. The call will be broadcast live and
then via replay for two weeks on the Company's Web
site: http://www.polyone.com .

About PolyOne

PolyOne Corporation, with 2002 annual revenues approximating $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 and Asia. Information on the
Company's products and services can be found at http://www.polyone.com .

Forward-looking Statements

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 or achievement of less than the anticipated
financial benefit from the initiatives related to restructuring programs
including cost reduction and employee productivity goals; (2) a delay or
inability to achieve targeted debt level reductions through divestitures or
other means; (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 within the
Company's various 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) an
inability or delay in finding buyers of non-core assets for reasonable and
acceptable terms; (16) an inability to access the receivables sale facility
as a result of breaching covenants; (17) any poor performance of our pension
plan assets and any obligation on our part to fund our pension plan; and (18)
any or a delay or inability to bring the North American colors and performance
additives and the engineered materials product platforms to profitability.

We cannot guarantee that any forward-looking statement will be realized,
although we believe we have been prudent in our plans and assumptions.
Achievement of future results is subject to risks, uncertainties and
inaccurate assumptions. Should known or unknown risks or uncertainties
materialize, or should underlying assumptions prove inaccurate, actual results
could vary materially from those anticipated, estimated or projected.
Investors should bear this in mind as they consider forward-looking
statements.

We undertake no obligation to publicly update forward-looking statements,
whether as a result of new information, future events or otherwise. You are
advised, however, to consult any further disclosures we make on related
subjects in our Form 10-Q, 8-K and 10-K reports to the Securities and Exchange
Commission. You should understand that it is not possible to predict or
identify all such factors. Consequently, you should not consider any such
list to be a complete set of all potential risks or uncertainties.
(Ref. #10203)


                       PolyOne Corporation and Subsidiaries
           Condensed Consolidated Statements of Operations (Unaudited)
                       (In millions, except per share data)

                                            Three Months
                                               Ended       Nine Months Ended
                                           September 30,     September 30,
                                            2003    2002     2003      2002

    Sales                                  $630.3  $650.7  $1,926.7  $1,917.9

    Operating costs and expenses:
      Cost of sales                         539.8   548.9   1,651.3   1,598.0
      Selling and administrative             67.3    68.7     209.4     224.0
      Depreciation and amortization          18.2    18.2      55.1      54.6
    Employee separation and plant phase-
     out                                      8.2     0.2      35.2       1.1
    Loss on divestiture of equity
     investment                               -       -         -         1.5
    Income from equity affiliates and
     minority interest                      (10.1)  (11.6)    (25.8)    (13.6)
    Operating income                          6.9    26.3       1.5      52.3

    Interest expense                        (19.2)  (11.6)    (49.0)    (31.4)
    Interest income                           0.3     0.1       0.6       0.6
    Other income (expense), net              (3.5)    0.5     (10.1)     (3.9)
    Income (loss) before income taxes,
     discontinued operations, and
     cumulative effect of change in
     accounting method                      (15.5)   15.3     (57.0)     17.6

    Income tax expense                      (27.7)   (5.7)    (11.5)     (6.6)
    Income (loss) before discontinued
     operations and cumulative effect
     of a change in accounting              (43.2)    9.6     (68.5)     11.0
    Income from discontinued operations,
     net of income taxes                      -       0.2       -         1.3
    Cumulative effect of a change in
     goodwill accounting, net of income
     tax benefit of $1.0 million              -       -         -       (53.7)
    Net income (loss)                      $(43.2)   $9.8    $(68.5)   $(41.4)

    Income (loss) per share of common
     stock:
         Basic income (loss) per share
          before discontinued operations
          and effect of change in
          accounting                        $(.47)   $.11     $(.75)     $.12
         Discontinued operations              -       -         -         .01
         Cumulative effect of a change in
          accounting                          -       -         -        (.59)
         Basic income (loss) per share      $(.47)   $.11     $(.75)    $(.46)

         Diluted income (loss) per share
          before discontinued operations
          and effect of change in
          accounting                        $(.47)   $.11     $(.75)     $.12
         Discontinued operations              -       -         -         .01
         Cumulative effect of a change in
          accounting                          -       -         -        (.58)
         Diluted income (loss) per share    $(.47)   $.11     $(.75)    $(.45)

    Weighted average shares used to
     compute loss per share:
         Basic                               91.1    90.7      91.0      90.6
         Diluted                             91.1    91.7      91.0      92.1

    Dividends paid per share of common
     stock                                   $-    $.0625      $-      $.1875


                      PolyOne Corporation and Subsidiaries
                Condensed Consolidated Balance Sheet (Unaudited)
                                  (In millions)

                                               September 30,      December 31,
    Assets                                          2003              2002
    Current assets:
      Cash and cash equivalents                      $50.4             $41.4
      Accounts receivable, net                       315.2             164.3
      Inventories                                    259.1             253.7
      Deferred taxes                                  41.2              42.1
      Other current assets                            22.8              12.7
        Total current assets                         688.7             514.2
    Property, net                                    656.6             682.1
    Investment in equity affiliates                  264.1             271.8
    Goodwill, net                                    444.7             444.0
    Other intangible assets, net                      29.8              32.8
    Other non-current assets                          63.8              52.6
        Total assets                              $2,147.7          $1,997.5

    Liabilities and Shareholders' Equity
    Current liabilities:
      Short-term bank debt                            $0.9              $0.7
      Accounts payable                               257.0             242.0
      Accrued expenses                               133.9             160.2
      Current portion of long-term debt                0.8              91.0
        Total current liabilities                    392.6             493.9
    Long-term debt                                   785.2             492.2
    Deferred taxes                                    40.7              39.0
    Post-retirement benefits other than
     pensions                                        120.9             122.5
    Other non-current liabilities,
     including pensions                              266.0             261.2
    Minority interest in consolidated
     subsidiaries                                     10.2               9.0
        Total liabilities                          1,615.6           1,417.8
    Shareholders' equity:
      Preferred stock                                   -                 -
      Common stock                                     1.2               1.2
      Other shareholders' equity                     530.9             578.5
        Total shareholders' equity                   532.1             579.7
          Total liabilities and shareholders'
           equity                                 $2,147.7          $1,997.5


                     PolyOne Corporation and Subsidiaries
          Condensed Consolidated Statements of Cash Flows (Unaudited)
                                 (In millions)

                                            Three Months     Nine Months
                                                Ended           Ended
                                            September 30,    September 30,
                                           2003      2002    2003     2002
    Operating Activities
      Net income (loss)                   $(43.2)     $9.8  $(68.5) $(41.4)
      Cumulative effect of a change in
       accounting                            -         -       -     (53.7)
      Income from discontinued operations    -         0.2     -       1.3
      Income (loss) from continuing
       operations                          (43.2)      9.6   (68.5)   11.0
      Adjustments to reconcile net income
       (loss) to net cash used by operating
        activities:
          Employee separation and plant
           phase-out charges                 8.2       0.2    35.2     1.1
          Cash payments on employee
           separation and plant phase-out  (12.0)     (4.4)  (35.3)  (12.1)
          Depreciation and amortization     18.2      18.2    55.1    54.6
          Unrealized currency gains         (2.0)     (7.2)   (8.9)  (10.8)
          Loss on sale of assets             -         -       0.2     -
          Investment write-down and loss
           on sale of equity affiliate       -         -       -       1.5
          Companies carried at equity and
           minority interest:
             Income  from equity
              affiliates                   (11.0)    (12.2)  (27.2)  (15.0)
             Minority interest expense       0.9       0.6     1.4     1.4
             Dividends and distributions
              received                      10.6      13.8    12.6    16.8
          Deferred income taxes             24.2       2.3     -       0.9
          Change in assets and
           liabilities:
              Operating working capital:
                  Accounts receivable      (16.0)     17.0  (141.1)  (72.3)
                  Inventories               27.3      (2.2)    1.3   (32.9)
                  Accounts payable         (13.0)     (0.5)    9.3   (20.1)
              Accrued expenses and other    15.2     (14.2)    1.5    15.7
    Net cash provided (used) by operating
     activities for continuing operations    7.4      21.0  (164.4)  (60.2)

    Investing Activities
      Capital expenditures                  (8.8)    (16.1)  (24.9)  (49.1)
      Decrease in restricted cash           53.7       -       -       -
      Return of capital by equity
       affiliates, net of investment         -         2.8    (0.1)    2.3
      Business acquired, net of cash
       received                              -         -     (15.8)    -
      Proceeds from sale of assets           4.4       0.8    27.0     1.9
    Net cash provided (used) by financing
     activities for continuing operations   49.3     (12.5)  (13.8)  (44.9)

    Financing Activities
      Change in short-term debt            (56.1)     (3.7)  (90.1)   (5.8)
      Change in long-term debt              (6.1)     (1.1)  297.8   153.9
      Debt issuance Costs                   (0.7)      -     (14.7)   (4.9)
      Termination of interest rate swap
       agreements                           (2.6)      8.3    (2.6)    8.3
      Proceeds from the exercise of stock
       options                               -         2.0     -       7.0
      Dividends                              -        (5.7)    -     (16.9)
    Net cash provided (used) by financing
     activities for continuing operations  (65.5)     (0.2)  190.4   141.6

    Net cash used by discontinued
     operations                              -         -       -       1.4

    Effect of exchange rate changes on
     cash                                   (4.0)     (1.1)   (3.2)   (2.7)

    Increase in cash and cash equivalents  (12.8)      7.2     9.0    35.2

    Cash and cash equivalents at
     beginning of period                    63.2      46.2    41.4    18.2

    Cash and cash equivalents at end of
     period                                $50.4     $53.4   $50.4   $53.4


                       Summary of Special Items (Unaudited)
                                  (In millions)

                                               Three Months       Nine Months
                                            3Q03   2Q03   3Q02    2003   2002
    Employee separation and plant phase-
     out costs (A)                         $(8.2) $(2.1) $(0.2) $(35.2) $(1.1)
    Period plant phase-out costs
     incurred (B)                           (1.2)  (0.3)  (0.5)   (2.4)  (0.7)
    Equity affiliate - employee
     severance, liabilities
     associated with the temporary
     idling of a plant and cumulative
     effect of a change in accounting (C)    -     (1.0)  (4.1)   (1.8)  (4.9)
    Loss on divestiture of equity
     investment (D)                          -      -      -       -     (1.5)
        Subtotal - impact on EBITDA
         (expense)                          (9.4)  (3.4)  (4.8)  (39.4)  (8.2)
    Plant phase-out accelerated
     depreciation (B)                        -      -     (0.5)    -     (1.5)
        Subtotal - impact on operating
         (expense)                          (9.4)  (3.4)  (5.3)  (39.4)  (9.7)
    Loss on sale (E)                         -     (0.2)   -      (0.2)   -
        Total  - impact pre tax (expense)   (9.4)  (3.6)  (5.3)  (39.6)  (9.7)
    Income tax benefit on above items        3.0    1.3    1.9    14.7    3.5
    Foreign dividend tax (F)               (24.0)   -      -     (24.0)   -
    Tax allowance (G)                       (9.0)   -      -      (9.0)   -
        Total - after tax (expense)
         before discontinued
         operations and cumulative
         effect of a change
         in accounting                    $(39.4) $(2.3) $(3.4) $(57.9) $(6.2)


    (A)  These costs include severance, employee outplacement, external
    outplacement consulting, lease termination, facility closing costs and the
    write-down of the carrying value of plants and equipment related to
    restructuring initiatives.  The 2003 expense relates to the following:
          * January 16, 2003 announcement to reduce approximately 400 staff
            personnel.
          * March 26, 2003 announcement to exit an Engineering Films plant in
            Yerington, Nevada.
          * June 2003 decision to close the Fort Worth, Texas plant.
          * Second quarter reversal of restructuring costs provided for in
            prior years.
          * Third quarter reduction of 112 North American plastics personnel
            (71 in manufacturing and 41 in sales and administration).
            Manufacturing reductions include the shutdown of the St. Remi,
            Quebec powder production, elimination of vinyl compound
            production shifts and staff reductions at the Macedonia, Ohio
            engineered materials plant.
          * Third quarter closure of two leased Ohio administrative offices.
          * Third quarter closure of a portion of the Mexico distribution
            business.  The restructuring costs include asset write-offs
            totaling $0.4 million.
    The 2002 expense was associated with the consolidation of certain
    activities related to the Formulator operations in the Performance
    Plastics business segment.

    (B)  These are plant and phase-out costs associated with the 2001 Geon
    restructuring initiatives that are to be recognized as period costs versus
    when the restructuring initiative was approved. In connection with the
    acquisition of Hanna and resulting formation of PolyOne, management
    developed several initiatives to capture the strategic value of the
    combined former Geon and former Hanna businesses.  This resulted in
    several announcements in 2001 that former Geon plants and Hanna plants
    would be closed.  The initiatives also included the termination of
    corporate and other positions at Geon and former Hanna locations.  The
    2003 third quarter expense is for the write-off of inventory and
    receivables as a result of the decision to close the Mexico distribution
    business.

    (C)  The second quarter 2003 expense relates to employee severance costs
    associated with a personnel reduction undertaken by OxyVinyls.  In
    addition, the 2003 first nine months expense includes a charge for the
    cumulative effect of a change in accounting upon OxyVinyls adoption of
    SFAS No. 143 "Accounting for Asset Retirement Obligations."  The 2002
    costs include PolyOne's share of OxyVinyls employee severance, plant
    phase-out costs and liabilities associated with the temporary idling of a
    plant in December 2001 and the asset write-off and decommissioning costs
    related to the permanent closure of a portion of a plant in 2002.

    (D)  Includes the 2002 first quarter loss on our divestiture of our 37.4%
    investment in the PVC resin operations of Australian Vinyls Corporation.

    (E)  Loss recorded for the sale of our European vinyl compounding
    business.

    (F)  U.S. tax expense related to foreign subsidiary dividends to be paid
    in the fourth quarter of 2003.

    (G)  Tax allowance to reduce net U.S. deferred income tax assets resulting
    from operating loss carry-forwards.


              Business Segment Operations and Other Data (Unaudited)
                                  (In millions)

    Senior management uses operating income before special items as a business
    segment measure of operating performance.  Also, EBITDA before special
    items is used as a business segment cash flow metric.  For a
    reconciliation from operating income to operating income before special
    items to EBITDA before special items and EBITDA to EBITDA before special
    items, see the following table.  Operating income before special items and
    EBITDA before special items are non-GAAP measures and should not be
    considered an alternative to any other measures of performance in
    accordance with GAAP.  Senior management presents operating income before
    special items and EBITDA before special items when discussing the business
    segments because senior management believes such measures are useful in
    assessing the underlying earnings and cash generating power of each
    business segment.  Special items include gains and losses associated with
    the specific strategic initiatives such as restructuring or consolidation
    of operations, gains and losses attributable to divestment of joint
    ventures, and certain one-time items.

    Accordingly, senior management believes that excluding special items
    provides insight into the underlying metric achievement level and their
    potential future implication.  Operating income before special items and
    EBITDA before special items may not be comparable to financial performance
    measures presented by other companies.


                                        Three Months           Nine Months
    Operations:                     3Q03    2Q03    3Q02      2003      2002

    Sales:
        Performance Plastics       $445.3  $460.5  $448.9  $1,353.4  $1,321.9
        Elastomers and Performance
         Additives                   84.6    87.5    95.2     266.1     282.7
        Distribution                128.1   133.1   135.8     397.1     393.8
        Resin & Intermediates         -       -        -        -         -
        Other                       (27.7)  (30.2)  (29.2)    (89.9)    (80.5)
                                   $630.3  $650.9  $650.7  $1,926.7  $1,917.9

    Operating income (loss) before
     special items:
        Performance Plastics        $10.9    $7.3   $16.8     $23.0     $48.6
        Elastomers and Performance
         Additives                    0.1     1.2     5.0       3.5      11.7
        Distribution                  2.7     2.8     2.4       8.4       8.1
        Resin & Intermediates         7.5     7.5    11.4      19.0       6.9
        Other                        (4.9)   (4.6)   (4.0)    (13.0)    (13.3)
                                    $16.3   $14.2   $31.6     $40.9     $62.0

    Other Data:

    EBITDA before special items:
        Performance Plastics        $25.1   $22.0   $30.7     $66.6     $90.1
        Elastomers and Performance
         Additives                    3.1     4.2     7.7      12.6      20.8
        Distribution                  3.1     3.2     2.8       9.6       9.5
        Resin & Intermediates         7.6     7.5    12.0      19.2       7.5
        Other                        (4.4)   (4.3)   (3.9)    (12.0)    (12.8)
                                    $34.5   $32.6   $49.3     $96.0    $115.1

    Reconciliation:
         Operating income            $6.9   $10.8   $26.3      $1.5     $52.3
         Special items, expense       9.4     3.4     5.3      39.4       9.7
              Operating income
               before special
               items                 16.3    14.2    31.6      40.9      62.0
         Depreciation and
          amortization               18.2    18.4    18.2      55.1      54.6
         Accelerated depreciation
          in special items            -       -      (0.5)      -        (1.5)
              EBITDA before
               special items        $34.5   $32.6   $49.3     $96.0    $115.1
         EBITDA                     $25.1   $29.2   $44.5     $56.6    $106.9
         Impact of special items,
          expense                     9.4     3.4     4.8      39.4       8.2
              EBITDA before
               special items        $34.5   $32.6   $49.3     $96.0    $115.1

     Note: The "Other" segment primarily consists of the elimination of inter-
           business segment sales and profit in inventories and unallocated
           corporate costs.

SOURCE PolyOne Corporation

Investors & Media, Dennis Cocco, Vice President, Investor
Relations & Communications of PolyOne Corporation, +1-440-930-1538

http://www.polyone.com

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