PolyOne sees a big jump in sales for 2013, thanks to acquisitions

By Frank Esposito
Senior Staff Reporter

Published: January 29, 2014 11:06 am ET
Updated: January 31, 2014 12:52 pm ET

Image By: PolyOne Corp. PolyOne Chairman, President and CEO Stephen Newlin

Related to this story

Topics Mergers & Acquisitions, Materials Suppliers
Companies & Associations PolyOne Corp.

Driven by a pair of acquisitions, materials firm PolyOne Corp. posted major gains in sales and profit in 2013.

PolyOne — the Avon Lake, Ohio-based firm that ranks as North America's largest plastics compounder — posted sales of almost $3.8 billion in 2013, up almost 32 percent vs. the prior year. The firm's profit also more than tripled to $242.7 million.

Most of the sales growth came from PolyOne's $393 million acquisition of Spartech Corp., a maker of plastic sheet, compounds and concentrates. That deal was announced in late 2012 and became official in early 2013. PolyOne's $34 million acquisition of Glasforms Inc. — a maker of glass and carbon fiber-reinforced polymers and advanced composite products — in late 2012 also boosted 2013 results.

In a Jan. 28 news release, PolyOne Chairman, President and CEO Stephen Newlin said that he was "extremely pleased with [PolyOne's] fourth quarter performance, which brings to a close another record year." The firm now has posted 17 quarters of consecutive double-digit growth in adjusted earnings per share, he added, describing that as "a distinguished performance that all of our associates are justifiably proud of."

In the release, Executive Vice President And Chief Operating Officer Robert Patterson said that the addition of Spartech added 12 cents to PolyOne's adjusted earnings per share in 2013. "We're very pleased with the speed at which we have been able to capture initial synergies [from the Spartech acquisition] and deliver operating income growth beyond our preliminary expectations," he said.

Spartech directly added almost $600 million to PolyOne's 2013 sales through the formation of a new Designed Structures & Solutions unit. Among previous PolyOne units, Performance Products & Solutions – including PVC compounds – led the firm's 2013 growth parade, with sales up almost 23 percent to $773.2 million. Sales in Global Specialty Engineered Materials grew more than 13 percent to $615.5 million.

For Global Color, Additives & Inks, the addition of some Spartech businesses contributed to sales growth of almost 10 percent to $852.3 million. The firm's PolyOne Distribution unit — one of North America's largest resin distributors — also saw sales grow more than 4 percent to almost $1.1 billion in 2013.

The Spartech deal, however, has faced some challenges in the form of the planned closing of six former Spartech plants and an administrative office. Those moves will result in the elimination of 270 jobs.

Market analyst Kevin Hocevar said he was impressed with PolyOne's performance in 2013.

PolyOne "continues to execute on their specialty strategy," said Hocever, who's with Northcoast Research in Cleveland. "Spartech looks like a home-run acquisition for them."

Hocevar pointed out that the 12-cent adjusted earnings per-share that PolyOne reported from Spartech in 9½ months was expected to be only 2 cents for the full year.

"In the first half, there were still some headwinds to organic growth, but that turned around in the second half and Europe became positive," he added. "PolyOne has a keen eye for what specialty products are."

PolyOne's per-share stock price has performed well on Wall Street in the last year. It was under $25 in early 2013 but was near $35.80 in early trading Jan. 30 for an increase of more than 40 percent.


Comments

PolyOne sees a big jump in sales for 2013, thanks to acquisitions

By Frank Esposito
Senior Staff Reporter

Published: January 29, 2014 11:06 am ET
Updated: January 31, 2014 12:52 pm ET

Post Your Comments


Back to story


More stories

Image

Impact-resistant window maker buys competitor for $111 million

July 31, 2014 3:07 pm ET

PGT Inc. is acquiring CGI Windows & Doors Holdings Inc. for $111 million as part of a plan to grow strategically by buying businesses with...    More

Buyer plans to sell former Hoover molding, assembly plants

July 31, 2014 2:06 pm ET

A former Hoover manufacturing plant with 150 injection machines in El Paso, Texas, and a nearby maquiladora plant in Juarez, Mexico, changed owners...    More

Private equity firm buys majority share of truck accessory maker

July 31, 2014 10:30 am ET

A majority share of Ann Arbor, Mich.-based truck accessory manufacturer Tectum Holdings Inc. has been acquired by Boston-based private equity firm TA ...    More

Image

Castle Harlan buys landscape erosion control firm Tensar

July 30, 2014 3:46 pm ET

Private equity group Castle Harlan inc. has acquired Atlanta-based Tensar Corp., with plans for the geosynthetic products maker and its subsidiaries...    More

Image

Styrolution will open new production late 2014

July 30, 2014 12:54 pm ET

Germany-based styrenic materials group, Styrolution, has announced it is expanding its facility in Ludwigshafen, Germany.    More

Market Reports

Pipe, Profile & Tubing Extrusion in North America 2014

U.S. demand for extruded plastics is expected to grow by 3 percent in 2014, with PVC remaining the largest segment.

Plastic pipe will post the strongest gains through 2018, continuing to take market share from competing materials in a range of markets.

Our latest market report provides in-depth analysis of current trends and their financial impact on the pipe, profile and tubing extrusion industry in North America.

Learn more

2014 Injection Molding Industry Report

GROWTH, OPPORTUNITY IN SIGHT FOR INJECTION MOLDERS IN 2014

In the wake of the economic turbulence earlier in this decade, molders today find themselves in much better shape. Molders are gaining a competitive advantage by investing in people, equipment and seeking inroads into new markets on a global scale.

Growth in the injection molding industry is going to be driven by low financing costs and a continued move to reshore some business.

Learn more

Shale Gas Market - Analysis of North American Region

This report highlights the impact of shale-based natural gas on the North American plastics market and features an in-depth analysis of production trends in the United States during 2013 and a forecast for 2014 and beyond.

Learn more

Upcoming Plastics News Events

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

January 14, 2015 - January 14, 2015Plastics in Automotive

February 4, 2015 - February 6, 2015Plastics News Executive Forum 2015

More Events