Materials supplier PolyOne Corp. had a busy day June 10 as the firm increased its financial expectations for the second quarter and announced a collaboration with industrial giant 3M Co.
For the second quarter, Avon Lake, Ohio-based PolyOne now expects adjusted earnings per share of between 72 and 74 cents, up from its prior estimate of 68 cents. In a June 10 news release, Chairman, President and CEO Robert Patterson said that the firm "is achieving better than expected margins in all segments from pricing actions, improved mix and cost reductions."
Patterson also highlighted PolyOne's Specialty Engineered Materials unit, which he said "is overcoming continued weakness" in Europe and China with gains in composites and wire and cable applications.
"We have invested heavily in composites over the last few years and are now delivering with multiple new business wins," Patterson said, adding that the firm "has also seen modest improvements" in certain end markets such as construction in North America.
Those improvements are positively impacting PolyOne's Performance Products & Solutions unit beyond the firm's previous expectations at the beginning of the quarter, according to Patterson.
The expectations announced June 10 are a turnaround from the first quarter of the year, when PolyOne, one of North America's largest compounders, concentrate makers and resin distributors, posted flat sales and a profit decline of almost 20 percent.
Those results led PolyOne to cut about 40 jobs during the first quarter, primarily in corporate and managerial positions. The firm also cut discretionary spending, including outside professional services and travel.
The announcement of higher financial expectations had a big impact on PolyOne's per-share stock price on June 10, sending it up more than 10 percent to close at $29.80, on a day when stocks overall climbed about 1 percent.
PolyOne will report second-quarter results in July. Officials said June 10 that the firm will provide additional details on its quarterly performance at that time, as well as updated expectations for the balance of the year.
The second big June 10 reveal for PolyOne was the launch of the Pinpoint Express Color and Dosing System in partnership with Minneapolis-based 3M. PolyOne officials described Pinpoint as "a revolutionary on-site polymer color matching and dosing system that accelerates the process of designing and coloring injection molded parts."
Pinpoint allows users to create, match and mix colors onsite, reducing lead times for short-run color development from weeks to hours, they added. The system combines proprietary software and liquid colorant technology from PolyOne's ColorMatrix Select system with proprietary dispensing and dosing technology from 3M.
Officials said that customer trials have resulted in significant color development lead time reductions, collapsing a typical four-week process to just a few hours. At the same time, they added, trials have shown that Pinpoint maintains exceptional color consistency.
PolyOne ColorMatrix general manager Will Nordloh said in a news release that Pinpoint "enables short-run injection molders to make a step change in their ability to serve their customers and grow revenue by significantly reducing the time needed to design and create colors."
He added that the system also helps reduce operating costs by eliminating the need to carry excess or expired colorant inventory.
3M executive Dave Gunderson said in the release that Pinpoint brings the innovation of 3M together with the colorant and plastic injection molding expertise of PolyOne. "The Pinpoint system is a revolution for the manufacturing of molded-in-color parts," added Gunderson, vice president and general manager of 3M's automotive aftermarket unit.
PolyOne employs almost 7,000 worldwide and posted sales of $3.5 billion in 2018.