AKRON, Ohio — Myers Industries has reported results for the fourth quarter and year ended Dec. 31, 2009.
Net sales from continuing operations were $188.3 million for the fourth quarter, an increase of 5 percent compared to $179.3 million in the fourth quarter of 2008. This increase primarily reflects higher volumes in the company’s material handling and lawn and garden segments.
Income from continuing operations was $2 million or 6 cents per share, compared to a loss of $(58.9) million or $(1.67) per share in the fourth quarter of 2008.
Fourth quarter income and earnings per share results were adversely affected by special pre-tax expenses of $5.5 million in 2009, $13.5 million in 2008, and a goodwill impairment charge of $60.1 million in the fourth quarter of 2008.
For the full year, net sales from continuing operations were $701.8 million for the year, a decrease of 14 percent compared to $813.5 million in 2008. This decrease was primarily due to lower volume and pricing in all segments, tracking in line with the weak economic environment.
Income from continuing operations was $7 million or 20 cents per share, compared to a loss of $(45.7) million or $(1.30) per share in 2008.
Full year income and earnings per share results were impacted by special pre-tax expenses of $24.8 million in 2009, $18.1 million in 2008, and the $60.1 million goodwill impairment charge in 2008.
Cash flow was strong for the year at approximately $72 million versus $60 million in 2008, primarily from working capital improvements. This enabled the company to reduce total debt by $67.3 million to $104.3 million at Dec. 31, 2009, from $171.6 million at Dec. 31, 2008.
President and Chief Executive Officer John Orr said, “We posted positive operating results for both the fourth quarter and full year, with sales trending up during the quarter after several straight quarters in negative territory. During the year, we invested in and completed two major restructuring initiatives to ensure profitable operations and help mitigate the effects of a weak economic environment. Strategically, we focused on operations excellence to position us as a stronger company, ready to capitalize on new opportunities as our markets and customers experience an economic recovery.
“In addition, our 2009 cash flow performance was exceptional due to numerous working capital initiatives and results from our restructuring. Our financial position is strong, and we used cash to significantly reduce debt, invest in the businesses and continue cash dividends for our shareholders.”
In the Distribution Segment, demand for tire and vehicle service remained slow during the quarter, tracking with the segment’s leading economic indicators. Sales declined 3 percent in the fourth quarter and 13 percent for the full year compared to the same periods of 2008. Profitability increased 30 percent for the fourth quarter, primarily due to a favorable product mix of supplies and SG&A reductions. Profitability declined 22 percent for the year, weighted by the full impact of weak end market demand.
Auto and Custom Segment sales, down 12 percent and 28 percent, respectively, for the fourth quarter and full year compared to 2008, primarily reflect the weakness in automotive and original equipment markets. Profitability was impacted in the 2008 fourth quarter and full year by a $60.1 million goodwill impairment charge, due to adverse market conditions. Results for both the 2009 and 2008 fourth quarter and full year periods include special pre-tax expenses.
Raw material costs increased throughout 2009 and continue to rise in the first quarter of 2010. The company said it continues to take appropriate actions to mitigate pressure from rising commodity resin costs.
Total debt was $104.3 million at Dec. 31, 2009, compared to $171.6 million at Dec. 31, 2008. At Dec. 31, 2009, the company had more than $240 million of available borrowing under its $250 million Credit Agreement, which expires in October 2011. The company is in compliance with all of its debt covenants, and management believes cash flow from operations and available credit facilities will be sufficient to meet expected business requirements in 2010.
The company expects 2010 to be a year of gradual economic recovery. Myers Industries made substantial progress in 2009 with aggressive and timely actions to improve its operations through restructuring programs in the Lawn and Garden and Material Handling Segments. In addition, the divestiture of two rubber products businesses from the Auto and Custom Segment decreased the company’s exposure to volatile Heavy Truck, Construction and certain Automotive markets.
The company said it continues to review its business segments for operational improvements, as well as selective acquisitions that align closely with its focus on high-value niche markets and will advance its product development and brand leadership strategy.
“We will remain focused on our business strategy for growth, which includes steady cash generation and balance sheet optimization so we can capitalize on both internal growth opportunities and acquisitions,” Orr concluded. “I would like to thank all of our employees for their commitment to our improvement initiatives and success in 2009 and beyond. As the economy recovers, we are in a strong position to deliver on our commitment to higher value for customers and shareholders.”
