PolyOne Corporation has reported its first quarter results for 2019, with poor results leading to job losses within the company.
The results showed $900 million of consolidated revenue, flat with the prior year, as growth from acquisitions of 3.5 per cent was offset by a 1.5 per cent reduction in organic sales and a two per cent impact due to unfavourable foreign exchange.
GAAP earnings per share were $0.49 in the first quarter of 2019 compared to $0.59 in the first quarter of 2018, and adjusted earnings per share were $0.64 in the first quarter of 2019, compared to $0.68 for the first quarter of 2018.
Robert M. Patterson, Chairman, President, and CEO of PolyOne corporation, said: “Like many companies in our space, we experienced weaker demand in certain end markets and unfavourable foreign exchange during the first quarter. This resulted in a year over year decline in sales and earnings.”
“Key drivers included lower automotive sales in Europe and China which impacted Colour, Additives and Inks, Specialty Engineered Materials, and a decline in construction related sales, which primarily impacted Performance Products and Solutions in North America.”
“These headwinds were partially offset by favourable product mix and margin expansion in Distribution as well as new business gains in composites and sustainable solutions. In fact, we had our best quarter ever for composites since we began investing in this space.”
Composite sales increased ten per cent organically driven by new business in consumer and electrical end markets.
Combined with strong performance from the company’s January 2019 acquisition of Fiber-Line, composites-led growth added 17 per cent to SEM operating income over the prior year first quarter.
Fiber-Line had the best quarter in its history as a result of the continued build-out of 4G and emerging 5G network infrastructure.
Sales for sustainable solutions including next generation packaging technologies which extend shelf-life for perishable beverages increased 34 per cent in China compared to the first quarter of last year.
Patterson said: “We believe the current market challenges are temporary, and we will see a recovery in the second half of the year. While we are encouraged and optimistic, we are not waiting for market improvement to unfold.”
“Accordingly, we have taken action to reduce costs primarily through targeted workforce reductions and limited discretionary spending.”