MOSCOW (MRC) -- PolyOne Corporation has reported its fourth quarter and full year results for 2016, with Q4 2016 profit jumping, said the producer on its site.
GAAP earnings per share in the fourth quarter of 2016 increased to USD0.40 from USD0.04 in the fourth quarter of 2015. Adjusted earnings per share was USD0.38 compared to USD0.39 in the prior year fourth quarter. Special items for the fourth quarter of 2016, which primarily included a mark-to-market pension adjustment and restructuring charges, resulted in a net after-tax gain of USD2.2 million, or USD0.02 per share. Special items in the prior year quarter, the largest of which were debt extinguishment costs, resulted in a net after-tax charge of USD30.4 million, or USD0.35 per share.
Full year 2016 GAAP earnings per share increased to USD1.95 in 2016, compared to USD1.63 in 2015. Adjusted earnings per share in 2016 increased to USD2.13, a 9% increase from USD1.96 in 2015.
"I'm pleased we delivered our 7th consecutive year of adjusted earnings per share expansion," said Robert M. Patterson, chairman, president, and chief executive officer, PolyOne Corporation. "Our Specialty Engineered Materials, Performance Products & Solutions (PP&S) and Distribution (POD) segments all delivered record operating income, helping us to overcome a number of macro-economic challenges and weaker performance in Designed Structures & Solutions (DSS)."
"As we discussed on our last earnings call, we anticipated a small reduction in adjusted EPS in the fourth quarter attributable to a number of factors but primarily due to weaker results in DSS and lower demand for oil and gas related applications," Mr. Patterson added. "Looking ahead, I am encouraged by our prospects for the future as we have continued to invest in commercial resources and innovation as well as completed exciting new acquisitions that will accelerate our growth."
In 2016, the company increased its commercial resources by 6%, which was incremental to the 10% expansion of sales associates in 2015. These associates led to a near-immediate impact in POD and PP&S where sales cycles are the shortest within the company, and both segments reported record operating income for the full year 2016. The company expects the additional sales, marketing and technology investments to begin contributing more meaningfully to its longer sales cycle businesses in 2017 and 2018.
The company's vitality index, which reflects the percentage of revenue from specialty products introduced in the last five years, remained world class at 42%. Notable new product advancements include ColorMatrix liquid fiber colorants that improve production efficiency and speed to market for textile applications, WithStand antimicrobial additives that help prevent surface bacteria, and Gravi-Tech high-density polymers that elevate the texture, feel and aesthetics of luxury packaging.
Important new technologies have also been added through strategic acquisitions. In the last 14 months, the company has completed five specialty acquisitions: Magenta, Kraton's TPE Assets, Gordon Holdings (Gordon Composites and Polystrand), Comptek and SilCoTec. These include new thermoset and thermoplastic composites, which represent the next frontier in lightweighting technology, thermoplastic elastomer adhesives and protective films. Most recently, the company purchased Comptek and SilCoTec, both small, privately owned and innovative providers of colorants, additives and formulations for niche applications in healthcare and aerospace.
As MRC informed before, in January 2016, PolyOne Corporation announced the acquisition of Magenta Master Fibers (Magenta), an innovative developer of specialty solid color concentrates for the global fiber industry. PolyOne purchased Magenta from BASF for USD22 million, which represents a multiple of 6.8x EBITDA. The acquisition was expected to add USD16 million to revenues and be accretive to earnings in 2016.
PolyOne Corporation is a global provider of specialized polymer materials, services, and solutions with operations in specialty polymer formulations, color and additive systems, polymer distribution and specialty vinyl resins.
MRC