UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM
8-K
CURRENT
REPORT PURSUANT
TO
SECTION 13 OR 15(D) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date of report (Date of earliest event
reported): January 27, 2010
CABOT
CORPORATION
(Exact
Name of Registrant as Specified in Its Charter)
DELAWARE
(State or
Other Jurisdiction of Incorporation)
|
1-5667
|
04-2271897
|
|
(Commission
File Number)
|
(IRS
Employer Identification No.)
|
|
TWO
SEAPORT LANE, SUITE 1300, BOSTON,
MASSACHUSETTS 02210-2019
|
|
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
(617)
345-0100
(Registrant’s
Telephone Number, Including Area Code)
(Former
Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction A.2.
below):
|
o
|
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
|
|
|
o
|
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
|
|
o
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
|
|
|
o
|
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
|
Item
2.02 Results of Operations and Financial Condition.
On
January 27, 2010, Cabot Corporation issued a press release announcing its
operating results for its fiscal quarter ended December 31, 2009. A
copy of the press release is furnished herewith as Exhibit 99.1.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits.
|
|
99.1
|
Press
release issued by Cabot Corporation on January 27,
2010
|
SIGNATURES
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
|
CABOT
CORPORATION
|
||
|
By:
|
/s/ James P.
Kelly
|
|
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Name:
|
James
P. Kelly
|
|
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Title:
|
Vice
President and Controller
|
|
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Date: January
27, 2010
|
||
EXHIBIT
INDEX
|
Exhibit
|
|
|
Number
|
Title
|
|
99.1
|
Press
release issued by Cabot Corporation on January 27,
2010
|
| Contact: | Susannah Robinson | |
| Director, Investor Relations | ||
|
617-342-6129
susannah_robinson@cabot-corp.com
|
CABOT
ANNOUNCES FIRST QUARTER FISCAL YEAR 2010 OPERATING RESULTS
Strong
earnings performance from higher sales, robust unit margins and delivery of
restructuring savings
BOSTON (January 27,
2010)- Cabot Corporation (NYSE: CBT) today announced results
for its first quarter of fiscal year 2010.
Key
Highlights
|
§
|
Quarterly
volumes increased 20-25% over first quarter 2009 as demand continued to
improve in key end markets
|
|
§
|
Announced
restructuring savings have been captured, achieving more than $80 million
of fixed cost savings on a full year run
rate
|
|
§
|
Emerging
markets have experienced fastest recovery, continue to represent a growing
portion of total company revenue
|
|
§
|
Income
from continuing operations improved by more than $40 million compared to
the first quarter of 2009
|
|
(In
millions, except per share amounts)
|
First
Fiscal Quarter
|
|||||||
|
2010
|
2009
|
|||||||
|
Net
sales
|
$ | 679 | $ | 652 | ||||
|
Net
income attributable to Cabot Corporation
|
$ | 29 | $ | 4 | ||||
|
Diluted
earnings per share from continuing operations
|
$ | 0.44 | $ | 0.06 | ||||
|
Less: Certain
items per share
|
$ | (0.21 | ) | $ | (0.02 | ) | ||
|
Adjusted
earnings per share
|
$ | 0.65 | $ | 0.08 | ||||
For the
first quarter of fiscal 2010, the Company reported net income of $29 million
($0.44 per diluted common share). Adjusted EPS was income of $0.65
per common share, excluding $0.21 per common share of certain items principally
related to restructuring charges. When compared to the first quarter
of fiscal 2009, results benefited from: i) higher volumes ($40 million), ii)
lower fixed costs from restructuring savings ($20 million), iii) replenishment
of inventory levels due to higher volumes ($15 million) and a weaker dollar ($5
million). Further benefiting results was the absence of high cost
inventory effects experienced in the first quarter of 2009 that did not occur in
2010. These positive factors were partially offset by an unfavorable
$3 million contract lag and LIFO impact related to our carbon black businesses
for the first quarter of fiscal 2010 compared to a $42 million benefit in the
first quarter of fiscal 2009. Sequentially, profitability benefited
from lower costs due to restructuring, favorable utilization variances, a weaker
dollar and lower unfavorable contract lag and LIFO effects. Details
of the Company’s financial results and certain items are provided in the
accompanying tables.
Commenting
on the results, Patrick Prevost, Cabot’s President and CEO, stated, “We are very
pleased with our results, as we are performing at pre-downturn earnings levels
despite lower sales volumes. Our ability to maintain unit margins
through the downturn and the early delivery of our restructuring savings were
critical to this performance. During the quarter, we experienced
continued improvement in our key end markets worldwide with emerging markets
seeing the fastest growth. We also sustained our solid cash and
balance sheet positions despite an increase in working capital that resulted
from higher demand.”
Page 1 of
4
Prevost
continued, “Through the economic crisis we maintained focus on the long-term,
including the commissioning of a 150,000 metric ton expansion at our carbon
black facility in Tianjin, China last September and the recent announcement of
our intention to triple fumed silica capacity at our facility in Jiangxi,
China. Our intent to grow in emerging markets is a key strategic
driver that will benefit results now and in the future.”
Financial
Detail
Segment
Results
Core Segment- First
quarter fiscal 2010 profitability in the Rubber Blacks Business increased by $18
million when compared to the same quarter of fiscal 2009 from 24% higher
volumes, lower fixed costs from restructuring savings and favorable utilization
variances. Additionally, unfavorable high cost inventory effects in
the first quarter of fiscal 2009 did not reoccur in fiscal
2010. These factors were partially offset by an unfavorable contract
lag and LIFO impact of $3 million compared to a $32 million benefit in the first
quarter of 2009. Volumes in China increased by 76% over the first
quarter of fiscal 2009, while South America increased by 33%, Southeast Asia by
21%, North America by 17% and Europe, Middle East, Africa by
3%. Sequentially, profitability increased by $26 million from higher
volumes, lower fixed costs and a lower unfavorable contract lag
impact. Volumes increased by 2% globally when compared to the fourth
quarter of fiscal 2009 as end markets continued to improve.
First
quarter fiscal 2010 profitability in the Supermetals Business increased by $2
million compared to the same quarter of fiscal 2009 principally due to lower raw
material costs. When compared to the fourth quarter of fiscal 2009,
profitability increased by $5 million from significantly higher volumes and
lower costs. The Supermetals Business continues to focus on cash
generation and during the first quarter of fiscal 2010 generated $11 million in
cash from a combination of improved operating results and working capital
reductions.
Performance
Segment- First quarter fiscal 2010 profitability in the
Performance Segment increased by $31 million when compared to the same quarter
of fiscal 2009. The increase was driven by significantly higher
volumes, lower fixed costs and favorable utilization
variances. Partially offsetting these factors was a $10 million LIFO
benefit in the first quarter of fiscal 2009 that did not reoccur in fiscal
2010. Volumes increased by 24% in Performance Products and by 19% in
Fumed Metal Oxides when compared to the first fiscal quarter of
2009. Sequentially, despite seasonally lower volumes, profitability
increased by $6 million driven by lower fixed costs and solid unit
margins. When compared to the fourth quarter of fiscal 2009, volumes
were down 2% in Performance Products and 9% in Fumed Metal Oxides.
New Business
Segment- First quarter fiscal 2010 revenues in the New
Business Segment were slightly below revenues in both the first and fourth
quarters of fiscal 2009. Solid revenues in Inkjet Colorants
were offset by a decline in the Aerogel business due to uneven order
patterns. The improvement in cash generation that began in fiscal
2009 was sustained through the first quarter of fiscal 2010.
Specialty Fluids
Segment- Profitability in the Specialty Fluids Segment for the
first quarter of fiscal 2010 increased by $1 million when compared to both the
first and fourth quarters of fiscal 2009. Business performance
benefited from higher margin rental revenue and a favorable service
mix.
Page 2 of
4
Cash
Performance- The Company ended the first quarter of fiscal
2010 with a cash balance of $242 million. Working capital increased
by $104 million from the impact of rising feedstock costs and higher sales
demand on our inventory and accounts receivable balances. Capital
expenditures for the first quarter of fiscal 2010 were $13 million.
Taxes- During the
first quarter of fiscal 2010, the Company recorded a tax provision of $11
million. The operating tax rate for the quarter was approximately
27%.
Outlook
Commenting
on the outlook for the Company, Prevost said, “Our key end markets are showing
continued signs of recovery which bodes well for the future. Given that we are
seeing demand stabilize around current levels, a full recovery to pre-downturn
volumes may occur at a more moderate pace. Our restructuring work is
yielding benefits, recently completed energy investments will begin to show
results in 2010 and our emerging market investments will enable growth in the
coming years. In summary, we have weathered the economic downturn
with a strong balance sheet and are confident we will deliver on our long-term
financial goals.”
Forward-Looking
Statements- This earnings release contains forward-looking
statements based on management’s current expectations, estimates and
projections. All statements that address expectations or projections
about the future (including our expectations concerning the annualized fixed
cost savings we expect from our restructuring initiative and demand for our
products), strategy for growth, market position, and expected financial results
are forward-looking statements. Some of the forward-looking
statements may be identified by words like “expects,” “anticipates,” “plans,”
“intends,” “projects,” “indicates,” and similar expressions. These
statements are not guarantees of future performance and involve a number of
risks, uncertainties and assumptions. Many factors, including those
discussed more fully elsewhere in this release and in documents filed with the
Securities and Exchange Commission by Cabot, particularly its latest annual
report on Form 10-K, could cause results to differ materially from those
stated. These factors include, but are not limited to changes in raw
material costs; costs associated with the research and development of new
products, including regulatory approval and market acceptance; competitive
pressures; successful integration of structural changes, including restructuring
plans, and joint ventures; the laws, regulations, policies and economic
conditions, including inflation, interest and foreign currency exchange rates,
of countries in which the company does business; and severe weather events that
cause business interruptions, including plant and power outages, or disruptions
in supplier or customer operations.
Explanation of Terms
Used- When explaining factors affecting our performance, we
use several terms. The term “LIFO benefit” or “LIFO impact” includes two
factors: (i) the impact of current inventory costs being recognized immediately
in cost of goods sold (“COGS”) under a last-in first-out method, compared to the
older costs that would have been included in COGS under a first-in first-out
method (“COGS impact”); and (ii) the impact of reductions in inventory
quantities, causing historical inventory costs to flow through COGS
(“liquidation impact”). The LIFO impact for the first quarter of
fiscal 2010 was a favorable $2 million and is comprised of a $3 million
favorable liquidation impact partially offset by a $1 million unfavorable COGS
impact. The LIFO impact for the first quarter of fiscal 2009 was a
$20 million benefit and was comprised entirely of COGS impact. The
term “contract lag” refers to the time lag of the price adjustments in certain
of our rubber blacks supply contracts to account for changes in feedstock costs
and, in some cases, changes in other relevant costs.
Page 3 of
4
Use of Non-GAAP Financial
Measures- The preceding discussion of our results and the
accompanying financial tables report adjusted EPS and also include information
on our reportable segment sales and segment (or business) operating profit
before taxes (“PBT”). Adjusted EPS and segment PBT are non-GAAP
financial measures and are not intended to replace EPS and income (loss) from
continuing operations before taxes, equity in net income of affiliated companies
and minority interest, respectively, the most directly comparable GAAP financial
measures. Both EPS and adjusted EPS are calculated on a diluted share
basis. In calculating adjusted EPS and segment PBT, we exclude
certain items, meaning items that are significant and unusual or infrequent and
not believed to reflect the true underlying business performance, and,
therefore, are not allocated to a segment’s results or included in adjusted
EPS. Further, in calculating segment PBT we include equity in net
income of affiliated companies, royalties paid by equity affiliates, and
allocated corporate costs but exclude interest expense, foreign currency
translation gains and losses, interest income, dividend income and unallocated
corporate costs. Our chief operating decision-maker uses adjusted EPS to
evaluate the underlying earnings power of the Company. Segment PBT is
used to evaluate changes in the operating results of each segment before
non-operating factors and before certain items and to allocate resources to the
segments. We believe that these non-GAAP measures also assist our
investors in evaluating the changes in our results and the Company’s
performance. A reconciliation of adjusted EPS to EPS is shown in the
table titled Certain Items and Reconciliation of Adjusted EPS, and a
reconciliation of total segment PBT to income (loss) from operations before
taxes, equity in net income of affiliated companies and minority interest is
shown in the table titled Summary Results by Segments. The certain
items that are excluded from our calculation of adjusted EPS and segment PBT are
detailed in the table titled Certain Items and Reconciliation of Adjusted
EPS.
Page 4 of
4
First
Quarter Earnings Announcement, Fiscal 2010
|
CABOT
CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
Periods
ended December 31
|
Three
Months
|
|||||||
|
Dollars
in millions, except per share amounts (unaudited)
|
2009
|
2008
|
||||||
|
Net
sales and other operating revenues
|
$ | 679 | $ | 652 | ||||
|
Cost
of sales
|
543 | 560 | ||||||
|
Gross
profit
|
136 | 92 | ||||||
|
Selling
and administrative expenses
|
67 | 56 | ||||||
|
Research
and technical expenses
|
18 | 18 | ||||||
|
Income
from operations
|
51 | 18 | ||||||
|
Other
income and expense
|
||||||||
|
Interest
and dividend income
|
- | 1 | ||||||
|
Interest
expense
|
(9 | ) | (9 | ) | ||||
|
Other
income (expense)
|
- | (9 | ) | |||||
|
Total
other income and expense
|
(9 | ) | (17 | ) | ||||
|
Income
from continuing operations before income taxes, equity in net
income
|
||||||||
|
of
affiliated companies and noncontrolling interests
|
42 | 1 | ||||||
|
Provision
for income taxes
|
(11 | ) | (1 | ) | ||||
|
Equity
in net income of affiliated companies, net of tax
|
3 | 2 | ||||||
|
Net
income
|
$ | 34 | $ | 2 | ||||
|
Net
income (loss) attributable to noncontrolling interests, net of
tax
|
5 | (2 | ) | |||||
|
Net
income attributable to Cabot Corporation
|
$ | 29 | $ | 4 | ||||
|
Diluted
earnings per share of common stock
|
||||||||
|
Net
income attributable to Cabot Corporation (A)
|
$ | 0.44 | $ | 0.06 | ||||
|
Weighted
average common shares outstanding
|
||||||||
|
Diluted
|
64 | 63 | ||||||
|
(A)
|
Prior
year earnings per share has been recast due to Cabot’s adoption of an
accounting pronouncement in the first quarter of fiscal 2010 that
changes the methodology for allocating earnings among
shareholders. Under this guidance, certain of Cabot's unvested
share-based payment awards must be included in the earnings allocation
process in computing earnings per share. This guidance has been
applied retrospectively so that all periods are shown on a consistent
basis.
|
||
First
Quarter Earnings Announcement, Fiscal 2010
|
CABOT
CORPORATION SUMMARY RESULTS BY SEGMENTS
|
|
Periods
ended December 31
|
Three
Months
|
|||||||
|
Dollars
in millions, except per share amounts (unaudited)
|
2009
|
2008
|
||||||
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SALES
|
||||||||
|
Core
Segment
|
$ | 441 | $ | 444 | ||||
|
Rubber
blacks
|
396 | 399 | ||||||
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Supermetals
|
45 | 45 | ||||||
|
Performance
Segment
|
184 | 157 | ||||||
|
Performance
products
|
122 | 105 | ||||||
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Fumed
metal oxides
|
62 | 52 | ||||||
|
New
Business Segment
|
17 | 18 | ||||||
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Inkjet
colorants
|
14 | 13 | ||||||
|
Aerogel
|
2 | 4 | ||||||
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Superior
MicroPowders
|
1 | 1 | ||||||
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Specialty
Fluids Segment
|
15 | 15 | ||||||
|
Segment
sales
|
657 | 634 | ||||||
|
Unallocated
and other (A),
|
22 | 18 | ||||||
|
Net
sales and other operating revenues
|
$ | 679 | $ | 652 | ||||
|
SEGMENT
PROFIT (LOSS)
|
||||||||
|
Core
Segment
|
$ | 47 | $ | 27 | ||||
|
Rubber
blacks
|
42 | 24 | ||||||
|
Supermetals
|
5 | 3 | ||||||
|
Performance
Segment
|
34 | 3 | ||||||
|
New
Business Segment
|
(3 | ) | (3 | ) | ||||
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Specialty
Fluids Segment
|
5 | 4 | ||||||
|
Total
Segment Profit (B)
|
83 | 31 | ||||||
|
Interest
expense
|
(9 | ) | (9 | ) | ||||
|
Certain
items (C)
|
(17 | ) | (2 | ) | ||||
|
Unallocated
corporate costs
|
(11 | ) | (7 | ) | ||||
|
General
unallocated expense
(D)
|
(1 | ) | (10 | ) | ||||
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Less:
Equity in net income of affiliated companies, net of tax
|
(3 | ) | (2 | ) | ||||
|
Income
from continuing operations before income taxes, equity in net income of
affiliated companies and noncontrolling interests
|
42 | 1 | ||||||
|
Provision
for income taxes
|
(11 | ) | (1 | ) | ||||
|
Equity
in net income of affiliated companies, net of tax
|
3 | 2 | ||||||
|
Net
income
|
$ | 34 | $ | 2 | ||||
|
Net
income (loss) attributable to noncontrolling interests, net of
tax
|
5 | (2 | ) | |||||
|
Net
income attributable to Cabot Corporation
|
$ | 29 | $ | 4 | ||||
|
Diluted
earnings per share of common stock
|
||||||||
|
Net
income attributable to Cabot Corporation
(E)
|
$ | 0.44 | $ | 0.06 | ||||
|
Weighted
average common shares outstanding
|
||||||||
|
Diluted
|
64 | 63 | ||||||
|
(A)
|
Unallocated
and other reflects royalties paid by equity affiliates and other operating
revenues and external shipping and handling fees.
|
||||
|
(B)
|
Segment
profit is a measure used by Cabot's Chief Operating Decision-Maker to
measure consolidated operating results, assess segment performance and
allocate resources. Segment profit includes equity in net income of
affiliated companies, royalty income, and allocated corporate
costs.
|
||||
|
(C)
|
Details
of certain items are presented in the Certain Items and Reconciliation of
Adjusted EPS table.
|
||||
|
(D)
|
General
unallocated expense includes foreign currency transaction gains (losses),
interest income, and dividend income.
|
||||
|
(E)
|
Prior
year earnings per share has been recast due to Cabot’s adoption of an
accounting pronouncement in the first quarter of fiscal 2010 that changes
the methodology for allocating earnings among
shareholders. Under this guidance, certain of Cabot's unvested
share-based payment awards must be included in the earnings allocation
process in computing earnings per share. This guidance has been
applied retrospectively so that all periods are shown on a consistent
basis.
|
||||
First
Quarter Earnings Announcement, Fiscal 2010
|
CABOT
CORPORATION CONSOLIDATED FINANCIAL POSITION
|
|
December
31,
|
September
30,
|
|||||||
|
2009
|
2009
|
|||||||
|
Dollars
in millions, except share and per share amounts
|
(unaudited)
|
(audited)
|
||||||
|
Current
assets:
|
||||||||
|
Cash
and cash equivalents
|
$ | 242 | $ | 304 | ||||
|
Short-term
marketable securities
|
1 | 1 | ||||||
|
Accounts
and notes receivable, net of reserve for doubtful accounts of $6 and
$6
|
507 | 452 | ||||||
|
Inventories:
|
||||||||
|
Raw
materials
|
121 | 118 | ||||||
|
Work
in process
|
41 | 44 | ||||||
|
Finished
goods
|
184 | 165 | ||||||
|
Other
|
30 | 31 | ||||||
|
Total
inventories
|
376 | 358 | ||||||
|
Prepaid
expenses and other current assets
|
63 | 53 | ||||||
|
Deferred
income taxes
|
32 | 32 | ||||||
|
Total
current assets
|
1,221 | 1,200 | ||||||
|
Investments:
|
||||||||
|
Equity
affiliates
|
58 | 60 | ||||||
|
Long-term
marketable securities and cost investments
|
1 | 1 | ||||||
|
Total
investments
|
59 | 61 | ||||||
|
Property,
plant and equipment
|
2,991 | 3,000 | ||||||
|
Accumulated
depreciation and amortization
|
(2,003 | ) | (1,988 | ) | ||||
|
Net
property, plant and equipment
|
988 | 1,012 | ||||||
|
Other
assets:
|
||||||||
|
Goodwill
|
36 | 37 | ||||||
|
Intangible
assets, net of accumulated amortization of $11 and $11
|
2 | 2 | ||||||
|
Assets
held for rent
|
41 | 43 | ||||||
|
Deferred
income taxes
|
238 | 235 | ||||||
|
Other
assets
|
85 | 86 | ||||||
|
Total
other assets
|
402 | 403 | ||||||
|
Total
assets
|
$ | 2,670 | $ | 2,676 | ||||
First
Quarter Earnings Announcement, Fiscal 2010
|
CABOT
CORPORATION CONSOLIDATED FINANCIAL POSITION
|
|
December
31,
|
September
30,
|
|||||||
|
2009
|
2009
|
|||||||
|
Dollars
in millions, except share and per share amounts
|
(unaudited)
|
(audited)
|
||||||
|
Current
liabilities:
|
||||||||
|
Notes
payable to banks
|
$ | 30 | $ | 29 | ||||
|
Accounts
payable and accrued liabilities
|
376 | 407 | ||||||
|
Income
taxes payable
|
34 | 31 | ||||||
|
Deferred
income taxes
|
5 | 5 | ||||||
|
Current
portion of long-term debt
|
6 | 5 | ||||||
|
Total
current liabilities
|
451 | 477 | ||||||
|
Long-term
debt
|
622 | 623 | ||||||
|
Deferred
income taxes
|
11 | 11 | ||||||
|
Other
liabilities
|
325 | 328 | ||||||
|
Stockholders'
equity:
|
||||||||
|
Preferred
stock:
|
||||||||
|
Authorized: 2,000,000
shares of $1 par value
|
||||||||
|
Issued
and outstanding: None and none
|
- | - | ||||||
|
Common
stock:
|
||||||||
|
Authorized: 200,000,000
shares of $1 par value
|
||||||||
|
Issued:
65,398,194 and 65,401,485 shares
|
65 | 65 | ||||||
|
Outstanding:
65,305,864 and 65,309,155 shares
|
||||||||
|
Less
cost of 92,330 and 92,330 shares of common treasury stock
|
(2 | ) | (2 | ) | ||||
|
Additional
paid-in capital
|
25 | 18 | ||||||
|
Retained
earnings
|
1,035 | 1,018 | ||||||
|
Deferred
employee benefits
|
(24 | ) | (25 | ) | ||||
|
Accumulated
other comprehensive income
|
56 | 60 | ||||||
|
Total
Cabot Corporation stockholders' equity
|
1,155 | 1,134 | ||||||
|
Noncontrolling
interests
|
106 | 103 | ||||||
|
Total
equity
|
1,261 | 1,237 | ||||||
|
Total
liabilities and equity
|
$ | 2,670 | $ | 2,676 | ||||
|
CABOT
CORPORATION
|
|
Fiscal
2009
|
Fiscal
2010
|
||||||||||||||||||||||||||||||
|
In
millions,
except
per share amounts (unaudited)
|
Dec.
Q.
|
Mar.
Q.
|
June
Q.
|
Sept.
Q.
|
FY
|
Dec.
Q.
|
Mar.
Q.
|
June
Q.
|
Sept.
Q.
|
FY
|
|||||||||||||||||||||
|
Sales
|
|||||||||||||||||||||||||||||||
|
Core
Segment
|
$ | 444 | $ | 295 | $ | 310 | $ | 377 | $ | 1,426 | $ | 441 | $ | 441 | |||||||||||||||||
|
Rubber
blacks
|
399 | 272 | 272 | 343 | 1,286 | 396 | 396 | ||||||||||||||||||||||||
|
Supermetals
|
45 | 23 | 38 | 34 | 140 | 45 | 45 | ||||||||||||||||||||||||
|
Performance
Segment
|
157 | 132 | 149 | 183 | 621 | 184 | 184 | ||||||||||||||||||||||||
|
Performance
products
|
105 | 90 | 98 | 118 | 411 | 122 | 122 | ||||||||||||||||||||||||
|
Fumed
metal oxides
|
52 | 42 | 51 | 65 | 210 | 62 | 62 | ||||||||||||||||||||||||
|
New
Business Segment
|
18 | 16 | 14 | 19 | 67 | 17 | 17 | ||||||||||||||||||||||||
|
Inkjet
colorants
|
13 | 9 | 10 | 14 | 46 | 14 | 14 | ||||||||||||||||||||||||
|
Aerogel
|
4 | 5 | 2 | 4 | 15 | 2 | 2 | ||||||||||||||||||||||||
|
Superior
MicroPowders
|
1 | 2 | 2 | 1 | 6 | 1 | 1 | ||||||||||||||||||||||||
|
Specialty
Fluids Segment
|
15 | 11 | 19 | 14 | 59 | 15 | 15 | ||||||||||||||||||||||||
|
Segment
Sales
|
634 | 454 | 492 | 593 | 2,173 | 657 | 657 | ||||||||||||||||||||||||
|
Unallocated
and other (A)
|
18 | 16 | 19 | 17 | 70 | 22 | 22 | ||||||||||||||||||||||||
|
Net
sales and other operating revenues
|
$ | 652 | $ | 470 | $ | 511 | $ | 610 | $ | 2,243 | $ | 679 | $ | 679 | |||||||||||||||||
|
Segment
Profit (Loss)
|
|||||||||||||||||||||||||||||||
|
Core
Segment
|
$ | 27 | $ | (24 | ) | $ | 14 | $ | 16 | $ | 33 | $ | 47 | $ | 47 | ||||||||||||||||
|
Rubber
blacks
|
24 | (17 | ) | 11 | 16 | 34 | 42 | 42 | |||||||||||||||||||||||
|
Supermetals
|
3 | (7 | ) | 3 | - | (1 | ) | 5 | 5 | ||||||||||||||||||||||
|
Performance
Segment
|
3 | (1 | ) | 10 | 28 | 40 | 34 | 34 | |||||||||||||||||||||||
|
New
Business Segment
|
(3 | ) | (1 | ) | (4 | ) | (2 | ) | (10 | ) | (3 | ) | (3 | ) | |||||||||||||||||
|
Specialty
Fluids Segment
|
4 | 4 | 9 | 4 | 21 | 5 | 5 | ||||||||||||||||||||||||
|
Total
Segment Profit (Loss) (B)
|
31 | (22 | ) | 29 | 46 | 84 | 83 | 83 | |||||||||||||||||||||||
|
Interest
expense
|
(9 | ) | (8 | ) | (6 | ) | (7 | ) | (30 | ) | (9 | ) | (9 | ) | |||||||||||||||||
|
Certain
items (C)
|
(2 | ) | (46 | ) | (19 | ) | (36 | ) | (103 | ) | (17 | ) | (17 | ) | |||||||||||||||||
|
Unallocated
corporate costs
|
(7 | ) | (8 | ) | (7 | ) | (6 | ) | (28 | ) | (11 | ) | (11 | ) | |||||||||||||||||
|
General
unallocated expense (D)
|
(10 | ) | (7 | ) | 1 | (4 | ) | (20 | ) | (1 | ) | (1 | ) | ||||||||||||||||||
|
Less:
Equity in net income of affiliated companies, net of tax
|
(2 | ) | - | - | (3 | ) | (5 | ) | (3 | ) | (3 | ) | |||||||||||||||||||
|
Income
(loss) before income taxes, equity in net income of affiliated companies
and noncontrolling interests
|
1 | (91 | ) | (2 | ) | (10 | ) | (102 | ) | 42 | 42 | ||||||||||||||||||||
|
(Provision)
benefit for income taxes
|
(1 | ) | 31 | (7 | ) | (1 | ) | 22 | (11 | ) | (11 | ) | |||||||||||||||||||
|
Equity
in net income of affiliated companies, net of tax
|
2 | - | - | 3 | 5 | 3 | 3 | ||||||||||||||||||||||||
|
Income
(loss) from continuing operations
|
2 | (60 | ) | (9 | ) | (8 | ) | (75 | ) | 34 | 34 | ||||||||||||||||||||
|
Loss
from discontinued operations, net of tax (E)
|
- | - | - | - | - | - | - | ||||||||||||||||||||||||
|
Net
income (loss)
|
2 | (60 | ) | (9 | ) | (8 | ) | (75 | ) | 34 | 34 | ||||||||||||||||||||
|
Net
income (loss) attributable to noncontrolling interests, net of
tax
|
(2 | ) | (2 | ) | 3 | 3 | 2 | 5 | 5 | ||||||||||||||||||||||
|
Net
income (loss) attributable to Cabot Corporation
|
$ | 4 | $ | (58 | ) | $ | (12 | ) | $ | (11 | ) | $ | (77 | ) | $ | 29 | $ | 29 | |||||||||||||
|
Diluted
earnings (loss) per share of common stock attributable to Cabot
Corporation
|
|||||||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||||
|
Continuing
operations (F)
|
$ | 0.06 | $ | (0.93 | ) | $ | (0.18 | ) | $ | (0.18 | ) | $ | (1.24 | ) | $ | 0.44 | $ | 0.44 | |||||||||||||
|
Discontinued
operations (E),
(F)
|
- | - | (0.01 | ) | - | (0.01 | ) | - | - | ||||||||||||||||||||||
|
Net
income (loss) attributable to Cabot Corporation (F)
|
$ | 0.06 | $ | (0.93 | ) | $ | (0.19 | ) | $ | (0.18 | ) | $ | (1.25 | ) | $ | 0.44 | $ | 0.44 | |||||||||||||
|
Weighted
average common shares outstanding
|
|||||||||||||||||||||||||||||||
|
Diluted
|
63 | 63 | 63 | 64 | 63 | 64 | 64 | ||||||||||||||||||||||||
|
(A)
|
Unallocated
and other reflects royalties paid by equity affiliates and other operating
revenues and external shipping and handling fees.
|
||||||||||||||||||||
|
(B)
|
Segment
profit is a measure used by Cabot's Chief Operating Decision-Maker to
measure consolidated operating results, assess segment performance and
allocate resources. Segment profit includes equity in net income of
affiliated companies, royalty income, and allocated corporate
costs.
|
||||||||||||||||||||
|
(C)
|
Details
of certain items are presented in the Certain Items and Reconciliation of
Adjusted EPS table.
|
||||||||||||||||||||
|
(D)
|
General
unallocated expense includes foreign currency transaction gains (losses),
interest income, and dividend income.
|
||||||||||||||||||||
|
(E)
|
Amounts
relate to legal settlements in connection with our discontinued
operations.
|
||||||||||||||||||||
|
(F)
|
Prior
year earnings per share has been recast due to Cabot’s adoption of an
accounting pronouncement in the first quarter of fiscal 2010 that changes
the methodology for allocating earnings among
shareholders. Under this guidance, certain of Cabot's unvested
share-based payment awards must be included in the earnings allocation
process in computing earnings per share. This guidance has been
applied retrospectively so that all periods are shown on a consistent
basis.
|
||||||||||||||||||||
First
Quarter Earnings Announcement, Fiscal 2010
|
CABOT CORPORATION CERTAIN ITEMS
AND RECONCILIATION OF ADJUSTED EPS
|
|
CERTAIN
ITEMS:
|
||||||||||||||||
|
Periods
ended December 31
|
Three
Months
|
|||||||||||||||
|
Dollars
in millions, except per share amounts (unaudited)
|
2009
|
2009
|
2008
|
2008
|
||||||||||||
|
$
|
per
share(A)
|
$
|
per
share(A)
|
|||||||||||||
|
Certain items before
income taxes
|
||||||||||||||||
|
Environmental
reserves
|
$ | (1 | ) | $ | (0.01 | ) | $ | - | $ | - | ||||||
|
Recovery
of previously impaired investment
|
$ | 1 | $ | 0.01 | ||||||||||||
|
Long-lived
asset impairment (B)
|
(2 | ) | (0.02 | ) | - | - | ||||||||||
|
Restructuring
initiatives:
|
||||||||||||||||
|
-
2008 Global
|
- | - | (2 | ) | (0.02 | ) | ||||||||||
|
-
2009 Global
|
(15 | ) | (0.19 | ) | - | - | ||||||||||
|
-
North America
|
- | - | (1 | ) | (0.01 | ) | ||||||||||
|
-
Europe (C)
|
- | - | 1 | 0.01 | ||||||||||||
|
Total
certain items
|
(17 | ) | (0.21 | ) | (2 | ) | (0.02 | ) | ||||||||
|
Tax
impact of certain items
|
4 | - | 1 | - | ||||||||||||
|
Total
certain items, after tax
|
(13 | ) | (0.21 | ) | (1 | ) | (0.02 | ) | ||||||||
|
Periods
ended December 31
|
Three
Months
|
|||||||
|
Dollars
in millions (unaudited)
|
2009
|
2008
|
||||||
|
Statement of
Operations Line Item
|
||||||||
|
Cost
of sales
|
$ | (8 | ) | $ | (1 | ) | ||
|
Selling
and administrative expenses
|
(9 | ) | (1 | ) | ||||
|
Research
and technical expenses
|
- | - | ||||||
|
Total
certain items
|
$ | (17 | ) | $ | (2 | ) | ||
|
NON-GAAP
MEASURE:
|
||||||||
|
Periods
ended December 31
|
Three
Months
|
|||||||
|
Dollars
in millions, except per share amounts (unaudited)
|
2009
|
2008
|
||||||
|
per
share(A)
|
per
share(A)
|
|||||||
|
Reconciliation of
Adjusted EPS to GAAP EPS
|
||||||||
|
Diluted
EPS
|
$ | 0.44 | $ | 0.06 | ||||
|
Total
certain items
|
(0.21 | ) | (0.02 | ) | ||||
|
Adjusted
EPS
|
$ | 0.65 | $ | 0.08 | ||||
|
(A)
|
Per
share amounts are calculated after tax.
|
||
|
(B)
|
Land related
to former carbon black site.
|
||
|
(C)
|
Amount relates
to former carbon black
facilities.
|
||