Net sales decreased 5% in both the third quarter and first nine months of
2008 compared to the same periods in 2007. Net sales decreased principally
due to lower order rates from most of CompX's customers resulting from
unfavorable economic conditions in
Kronos' net sales of
Kronos' income from operations for the third quarter of 2008 declined by
64% to
Changes in currency exchange rates affected Kronos' income from operations
by increasing income from operations by approximately
Kronos' third quarter 2008 TiO2 sales volumes decreased 12% from the third
quarter of 2007, with lower volumes in all markets. Volumes were 3% lower in
the year-to-date period, as higher volumes in export markets were more than
offset by lower volumes in European and
Kronos' income tax benefit in the first nine months of 2008 includes a
Insurance recoveries relate to amounts we received from certain of our
former insurance carriers, and are principally associated with the recovery of
prior lead pigment litigation defense costs incurred by us. These recoveries
aggregated
Corporate expenses were lower in the third quarter and first nine months of 2008 as compared to the third quarter and first nine months of 2007 primarily due to lower litigation and related expenses.
Interest income in the first nine months of 2008 includes
The Company's income tax benefit in the third quarter of 2007 includes
income of
The statements in this release relating to matters that are not historical facts are forward-looking statements that represent management's beliefs and assumptions based on currently available information. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it cannot give any assurances that these expectations will prove to be correct. Such statements by their nature involve substantial risks and uncertainties that could significantly impact expected results, and actual future results could differ materially from those described in such forward-looking statements. While it is not possible to identify all factors, the Company continues to face many risks and uncertainties. Among the factors that could cause actual future results to differ materially include, but are not limited to:
-- Future supply and demand for the Company's products,
-- The extent of the dependence of the Company's businesses on certain
market sectors,
-- The cyclicality of certain of the Company's businesses,
-- The impact of certain long-term contracts on certain of the Company's
businesses,
-- Customer inventory levels,
-- Changes in raw material and other operating costs,
-- The possibility of labor disruptions,
-- General global economic and political conditions,
-- Competitive products and substitute products,
-- Possible disruption of business or increases in the cost of doing
business resulting from terrorist activities or global conflicts,
-- Customer and competitor strategies,
-- Potential consolidation or solvency of competitors,
-- The impact of pricing and production decisions,
-- Competitive technology positions,
-- Service industry employment levels,
-- Demand for high performance marine components,
-- The introduction of trade barriers,
-- Fluctuations in currency exchange rates,
-- Operating interruptions,
-- The timing and amount of insurance recoveries,
-- The ability of the Company to renew or refinance credit facilities,
-- The ability of the Company to maintain sufficient liquidity,
-- The extent to which the Company's subsidiaries were to become unable to
pay dividends to the Company,
-- Uncertainties associated with new product development,
-- The ultimate outcome of income tax audits, tax settlement initiatives
or other tax matters,
-- The ultimate ability to utilize income tax attributes or changes in
income tax rates related to such attributes, the benefit of which has
been recognized under the more-likely-than-not recognition criteria,
-- Potential difficulties in integrating completed or future acquisitions,
-- Decisions to sell operating assets other than in the ordinary course of
business,
-- Environmental matters,
-- Government laws and regulations and possible changes therein,
-- The ultimate resolution of pending litigation, and
-- Possible future litigation.
Should one or more of these risks materialize (or the consequences of such a development worsen), or should the underlying assumptions prove incorrect, actual results could differ materially from those currently forecasted or expected. The Company disclaims any intention or obligation to update or revise any forward-looking statement whether as a result of changes in information, future events or otherwise.
NL Industries, Inc. is engaged in the component products (security products, furniture components and performance marine components), chemicals (TiO2) and other businesses.
NL INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share amounts)
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
2007 2008 2007 2008
Net sales $46.4 $43.9 $135.1 $128.1
Cost of sales 34.4 32.7 99.2 96.5
Gross margin 12.0 11.2 35.9 31.6
Selling, general and
administrative expense 6.5 6.3 19.7 19.2
Other operating income
(expense):
Insurance recoveries 1.2 .7 3.8 2.4
Facility consolidation expense (.8) - (.8) -
Goodwill impairment - (10.1) - (10.1)
Corporate expense and other, net (6.5) (3.0) (20.7) (13.9)
Loss from operations (.6) (7.5) (1.5) (9.2)
Equity in earnings (losses)
of Kronos Worldwide, Inc. (29.1) (1.3) (24.5) .7
General corporate items:
Interest and dividends 1.1 .8 3.6 6.9
Interest expense - (.6) (.1) (1.8)
Loss before income taxes
and minority interest (28.6) (8.6) (22.5) (3.4)
Provision for income taxes (benefit) (13.4) (.9) (13.2) .2
Minority interest in after-tax
earnings (losses) .8 (1.0) 2.5 (.5)
Net loss $(16.0) $(6.7) $ (11.8) $(3.1)
Net loss per basic and diluted share $(.33) $(.14) $(.24) $(.06)
Basic and diluted weighted-
average shares used in the
calculation of net loss
per share 48.6 48.6 48.6 48.6
NL INDUSTRIES, INC.
COMPONENTS OF LOSS FROM OPERATIONS
(In millions)
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
2007 2008 2007 2008
CompX - component products $4.2 $(5.2) $14.1 $2.2
Insurance recoveries 1.2 .7 3.8 2.4
Corporate expense and other, net (6.0) (3.0) (19.4) (13.8)
Loss from operations $(.6) $(7.5) $(1.5) $(9.2)
CHANGE IN KRONOS' TiO2 SALES
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
2008 vs. 2007 2008 vs. 2007
Percentage change in sales:
TiO2 product pricing 6% -%
TiO2 sales volume (12)% (3)%
TiO2 product mix -% 2%
Changes in foreign currency
exchange rates 7% 8%
Total 1% 7%
SOURCE NL Industries, Inc.
