Ferro: 3Q 2008 net sales up 11%

Performance materials manufacturer Ferro Corporation announced on 5 November 2008 net sales of USD 608.6 million for the quarter ended 30 September 2008, up 11% from USD 550.7 million in the 3Q 2007.

Performance materials manufacturer Ferro Corporation announced on 5 November 2008 net sales of USD 608.6 million for the quarter ended 30 September 2008, up 11% from USD 550.7 million in the 3Q 2007. Income from continuing operations for the 3Q 2008 was USD 4.9 million compared to USD 5.6 million in the 3Q 2007. Sales in the Color and Glass Performance Materials segment increased slightly as favorable changes in foreign currency exchange rates were largely offset by lower sales volume although there was a decline in segment income primarily as a result of higher manufacturing costs, lower sales volume and an increased bad debt allowance, partially offset by lower SG&A expense. “Our 3Q results continued the momentum built throughout 2008, with growth in net sales and segment income”, said chairman, president and chief executive officer James F. Kirsch. “Despite a deteriorating economic environment, the initiatives that we began in 2006 to rationalize our manufacturing assets and improve our business processes continue to generate positive results. We were successful in our sale of the Fine Chemicals business, and we are investing in our growth businesses, as evidenced by the construction of our latest solar pasting facility in Suzhou, China. We remain committed to our long-term goals, including completing our manufacturing restructuring and improving profitability, even as we focus our near-term efforts on controlling costs and discretionary spending”. Price increases and changes in foreign exchange were the major drivers of sales growth during the quarter. Price increases during the quarter included higher precious metal costs, which are passed on to customers as higher product prices. Changes in foreign currency exchange rates accounted for approximately one-third of the sales increase. Ferro expects 4Q 2008 net sales to be between USD 500 million and USD 550 million, compared with net sales of USD 571 million recorded in the 4Q 2007. The sales estimate incorporates the sale of Ferro“s Fine Chemicals business during the quarter. The sales estimate for the 4Q is consistent with current foreign exchange rates, the company“s cautious outlook for worldwide economic activity, and an estimate of the impact of recent credit market tightening on overall consumer and industrial demand. The sales decline is also the result of expected weaker customer demand, principally in the United States and Western Europe. Net income per share in the 4Q 2008 is expected to be in the range of USD 0.33 to USD 0.38 per share, including an estimated gain of USD 0.31 per share from the sale of the Fine Chemicals business.