Materials firm PolyOne Corp. posted lower first-quarter financial results as a result of early impacts of the COVID-19 crisis.
First-quarter sales at Avon Lake, Ohio-based PolyOne were down 5 percent to $711.5 million, as quarterly profit declined 14 percent to $32.8 million.
"Market conditions remain challenged, as most of the world outside of China remains under stay-at-home orders," Chairman, President and CEO Robert Patterson said in an April 21 news release.
"While our business is essential in the supply chain for our customers, we are adjusting to and expecting reduced demand in the coming months most notably for transportation and consumer discretionary items," he added.
In reporting segments, first-quarter sales in PolyOne's Color, Additives and Inks and Specialty Engineered Materials units each were down 2-3 percent. Sales in the firm's Distribution unit were down almost 9 percent.
First-quarter operating profit for PolyOne's SEM unit was up almost 9 percent, while Color was down 2.5 percent and Distribution essentially was flat in that category.
"Improving margins in all three of our segments and an uptick in orders in Asia at the end of the quarter led to even better results than we expected," Patterson said. "The pandemic has negatively impacted every region and many end markets, but certain end markets such as health care and packaging are holding up well."
Only two of PolyOne's 61 global production sites are closed. Officials said that the firm's materials allow food, beverages and medical supplies to continue to be produced and shipped. These items include masks, protective garments, medical tubing and packaging for personal care products.
On an April 21 conference call, Patterson said that PolyOne later in the second quarter would provide an update on its acquisition of the Masterbatches business of Clariant AG.
"At this time, there isn't any new information to provide other than to convey to you that like us, the Clariant Masterbatches team is working hard to serve their customers," he said.
In December 2019, PolyOne announced plans to acquire the Clariant unit for $1.45 billion. The business has annual sales of $1.1 billion. With the Clariant operations, PolyOne will add 46 manufacturing sites and technology centers in 29 countries and about 3,600 employees.
Patterson added that the Clariant business generates more than 70 percent of its sales from packaging, consumer and health care end markets. "Their products are essential and I expect their business to fare well through the coronavirus pandemic," he said.
Officials added that given the uncertainty in global markets, PolyOne doesn't plan to provide specific guidance for the second quarter or the balance of the year at this time.
Like many public firms, PolyOne's per-share stock price has been battered by the effects of COVID-19. The price began the year near $37 but was just under $20 in early trading April 22 for a decline of almost 46 percent.
PolyOne employs 5,600 worldwide and posted sales of $2.9 billion in 2019. The firm is a founding member of the Alliance to End Plastic Waste.