A Schulman Turns To Profit In Q4, Beats View; To Cut 40 Jobs In EMEA

(RTTNews) - Resin maker A. Schulman Inc (SHLM) on Wednesday reported a turnaround to profit in the fourth quarter, reflecting double-digit growth in revenues and fewer charges. Adjusted earnings per share for the quarter bat analysts' expectations. Looking ahead, Schulman forecast earnings for fiscal 2015 mostly above Street estimates.

Schulman also said that it plans to reduce headcount in Europe, Middle East and Africa or EMEA by about 40 employees, with the majority of reductions expected to be in the areas of back office and support functions.

Schulman is a supplier of plastic compounds and resins for packaging, automotive, consumer products, and industrial applications.

The Akron, Ohio-based company's net earnings for the fourth quarter were $15.17 million or $0.52 per share, compared to net loss of $2.68 million or $0.09 per share in the same period last year.

The latest quarter's results include one-time expenses of $4.31 million or $0.14 per share, compared to one-time expenses of $18.84 million or $0.64 per share in the year-ago period.

Excluding items, adjusted earnings for the quarter were $0.66 per share, compared with $0.55 per share a year ago. On average, four analysts polled by Thomson Reuters expected the company to report earnings of $0.64 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter grew 17 percent to $627.36 million from $537.29 million in the year-ago period.

Sales in the Europe, Middle East and Africa or EMEA segment climbed 11 percent from last year to $388.6 million, while sales for the Americas rose 22 percent to $188.3 million and sales for Asia Pacific or APAC surged 51 percent to $50.4 million.

For fiscal 2014, Schulman's net income was $56.19 million or $1.91 per share, up from $26.10 million or $0.89 per share in the previous year. Adjusted net income for the year was $69.31 million or $2.36 per share, compared to $53.78 million or $1.83 per share in the prior year.

Net sales for the year grew 15 percent to $2.45 billion from $2.13 billion last year.

Street expected the company to report earnings of $2.34 per share for the year on revenues of $2.44 billion.

For 2015, Schulman forecasts adjusted earnings of $2.60 to $2.65 per share. Analysts currently expect the company to report earnings of $2.60 per share for the year.

In a separate statement, Schulman said that it plans to reduce headcount in Europe, Middle East and Africa or EMEA by about 40 employees, with the majority of reductions expected to be in the areas of back office and support functions.

The job cuts are part of the company's efforts to optimize its back office and support functions in EMEA to better align its operations with current market conditions in the region.

Bernard Rzepka, Executive Vice President and Chief Operating Officer of Schulman, said, "While we are disappointed with the current economic conditions in Europe, we have an experienced team in place and have always taken proactive steps when required as we did in fiscal 2012 and 2013. During that time period, we generated approximately $8 million in savings from restructuring and optimization efforts in Europe."

SHLM closed Wednesday's trading at $30.14, down $1.96 or 6.11 percent on a volume of 369,288 shares. However, in after-hours, the stock gained $0.98 or 3.25 percent to $31.12.