Net income for the period was $22 million, or 21 cents per share, on net sales of $747 million. The net income figure includes a $17 million gain, or 16 cents per share, from an insurance settlement related to an explosion and fire at a Wiesbaden, Germany facility in October of 2000 and a $4 million, or 4 cents per share, loss resulting from February’s temporary shutdown of the Chocolate Bayou intermediates facility due to power outage.
This compares with net income for the first quarter of 2000 of $51 million, or 46 cents per share, on net sales of $846 million.
"Higher raw material and energy costs, specifically propylene and natural gas, a weaker euro and the slowing global economy continue to negatively impact Solutia's earnings," said John Hunter, chairman and CEO.
"We are implementing price increases where competition allows, aggressively managing capital programs to focus on critical growth opportunities and actively working our $100 million cost reduction initiative which promises to begin delivering savings in the second half of 2001."
Net sales for the first quarter of 2001 decreased 12% from the first quarter of 2000. Excluding the effects of the divestments of the Polymer Modifiers and Phosphorus businesses, sales for the ongoing businesses were on par with the prior year's quarter. The benefit of higher average selling prices and improved volume and sales mix were offset by the effect of a weaker euro on the translation of euro sales into U.S. dollars.
The Integrated Nylon segment's net sales for the first quarter of 2001 decreased by 3% vs. 2000 due to lower volumes, partially offset by higher selling prices. Integrated Nylon recorded a loss of $5 million in the first quarter, compared to a profit of $31 million in the first quarter of 2000. The loss was due to continued high raw material and energy costs and declining sales volumes.