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| 8-K - USG CORPORATION 8-K - USG CORP | a6803141.htm |
Exhibit 99.1
USG Corporation Reports Second Quarter 2011 Results
CHICAGO--(BUSINESS WIRE)--July 22, 2011--USG Corporation (NYSE:USG):
Second Quarter 2011 vs. Second Quarter 2010
Consolidated Business Highlights
- Sales decreased to $761 million compared to $769 million
- Operating loss of $21 million compared to $25 million
- Adjusted operating loss of $19 million compared to $18 million
Business Unit Highlights
- U.S. Gypsum wallboard shipments totaled 986 MMSF vs. 1,070 MMSF
- U.S. Gypsum average wallboard price of $111.55 per thousand square feet vs. $114.17
- Worldwide Ceilings operating profit of $22 million compared to $23 million
- L&W operating loss of $14 million compared to $22 million
USG Corporation (NYSE:USG), a leading building products company, today reported second quarter 2011 net sales of $761 million, an operating loss of $21 million and a net loss of $70 million, or $0.69 per share based on 103.6 million average shares outstanding. In last year’s second quarter, the operating loss was $25 million and the net loss was $74 million, or $0.74 per share based on 99.5 million average shares outstanding.
“We are continuing to pursue our near-term and long-term strategic priorities during the protracted recession in our domestic markets,” said James Metcalf, President and CEO. “By strengthening our core businesses, diversifying the sources of our earnings and aggressively leveraging our innovation leadership to differentiate USG’s products from the competition, we are confident that we can successfully navigate this recession and capitalize on a recovery.”
The corporation’s adjusted operating loss was $19 million in the second quarter of 2011, which compares to an adjusted operating loss of $18 million in the second quarter of 2010. The adjusted operating loss for the second quarter of 2011 excludes $2 million of restructuring and long-lived asset impairment charges, while the adjusted operating loss for the second quarter of 2010 excludes $7 million of restructuring and long-lived asset impairment charges.
For the first half of 2011, the corporation reported net sales of $1.5 billion and a net loss of $175 million, or $1.70 per share based on 103.3 million average shares outstanding. For the first half of 2010, net sales were $1.5 billion and the net loss was $184 million, or $1.85 per diluted share based on 99.5 million average shares outstanding. The corporation’s results for the first six months of 2011 included restructuring and long-lived asset impairment charges of $11 million, and its results for the first six months of 2010 included restructuring and long-lived asset impairment charges of $19 million.
A conference call is being held today at 10:00 A.M. Central Time during which USG senior management will discuss the corporation’s operating results. The conference call will be webcast on the USG Web site, www.usg.com, in the Investor Relations section. The dial-in number for the conference call is 1-866-352-2116 for participants in the United States (1-630-691-2782 for callers from other countries), and the pass code is 30234798. After the live webcast, a replay of the webcast will be available on the USG Web site. In addition, a telephonic replay of the call will be available until Friday, July 29, 2011. The replay dial-in number is 1-888-843-7419 (1-630-652-3042 for international callers), and the pass code is 30234798.
USG Corporation is a manufacturer and distributor of high-performance building systems through its United States Gypsum Company, USG Interiors, Inc., L&W Supply Corporation and other subsidiaries. Headquartered in Chicago, USG’s worldwide operations serve the residential and non-residential construction markets, repair and remodel construction markets, and industrial processes. USG’s wall, ceiling, flooring and roofing products provide leading-edge building solutions for customers, while L&W Supply branch locations efficiently stock and deliver building materials nationwide. For additional information, visit the USG Web site at www.usg.com.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 related to management’s expectations about future conditions. Actual business, market or other conditions may differ from management’s expectations and, accordingly, may affect our sales and profitability or other results and liquidity. Actual results may differ due to various other factors, including: economic conditions, such as the levels of new home and other construction activity, employment levels, the availability of mortgage, construction and other financing, mortgage and other interest rates, housing affordability and supply, the levels of foreclosures and home resales, currency exchange rates and consumer confidence; capital markets conditions and the availability of borrowings under our credit agreement or other financings; competitive conditions, such as price, service and product competition; shortages in raw materials; changes in raw material, energy, transportation and employee benefit costs; the loss of one or more major customers and our customers’ ability to meet their financial obligations to us; capacity utilization rates; changes in laws or regulations, including environmental and safety regulations; the outcome in contested litigation matters; the effects of acts of terrorism or war upon domestic and international economies and financial markets; and acts of God. We assume no obligation to update any forward-looking information contained in this press release.
| USG CORPORATION | |||||||||||||||||
| CONSOLIDATED STATEMENT OF EARNINGS | |||||||||||||||||
| (dollars in millions except per share data) | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| Three Months | Six Months | ||||||||||||||||
| ended June 30, | ended June 30, | ||||||||||||||||
| 2011 | 2010 | 2011 | 2010 | ||||||||||||||
| Net sales | $ | 761 | $ | 769 | $ | 1,482 | $ | 1,485 | |||||||||
| Cost of products sold | 708 | 714 | 1,393 | 1,416 | |||||||||||||
| Gross profit | 53 | 55 | 89 | 69 | |||||||||||||
| Selling and administrative expenses | 72 | 73 | 157 | 157 | |||||||||||||
| Restructuring and long-lived asset | |||||||||||||||||
| impairment charges | 2 | 7 | 11 | 19 | |||||||||||||
| Operating loss | (21 | ) | (25 | ) | (79 | ) | (107 | ) | |||||||||
| Interest expense | 52 | 44 | 104 | 89 | |||||||||||||
| Interest income | (2 | ) | (1 | ) | (4 | ) | (2 | ) | |||||||||
| Other income, net | (2 | ) | (1 | ) | (2 | ) | - | ||||||||||
| Loss before income taxes | (69 | ) | (67 | ) | (177 | ) | (194 | ) | |||||||||
| Income tax expense (benefit) | 1 | 7 | (2 | ) | (10 | ) | |||||||||||
| Net loss | $ | (70 | ) | $ | (74 | ) | $ | (175 | ) | $ | (184 | ) | |||||
| Basic loss per common share | $ | (0.69 | ) | $ | (0.74 | ) | $ | (1.70 | ) | $ | (1.85 | ) | |||||
| Diluted loss per common share | $ | (0.69 | ) | $ | (0.74 | ) | $ | (1.70 | ) | $ | (1.85 | ) | |||||
| Average common shares | 103,550,643 | 99,519,512 | 103,286,025 | 99,452,477 | |||||||||||||
| Average diluted common shares | 103,550,643 | 99,519,512 | 103,286,025 | 99,452,477 | |||||||||||||
| Other Information: | |||||||||||||||||
| Depreciation, depletion and amortization | $ | 44 | $ | 45 | $ | 85 | $ | 90 | |||||||||
| Capital expenditures | $ | 12 | $ | 5 | $ | 25 | $ | 11 | |||||||||
|
Average common shares and average diluted common shares outstanding are calculated in accordance with |
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Accounting Standards Codification 260, "Earnings Per Share." |
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| USG CORPORATION | |||||||||||||||||
| CORE BUSINESS RESULTS | |||||||||||||||||
| (dollars in millions) | |||||||||||||||||
| (Unaudited) | |||||||||||||||||
| Three Months | Six Months | ||||||||||||||||
| ended June 30, | ended June 30, | ||||||||||||||||
| 2011 | 2010 | 2011 | 2010 | ||||||||||||||
|
Net Sales: |
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| North American Gypsum: | |||||||||||||||||
| United States Gypsum Company | $ | 322 | $ | 336 | $ | 640 | $ | 668 | |||||||||
| CGC Inc. (gypsum) | 76 | 75 | 152 | 151 | |||||||||||||
| USG Mexico, S.A. de C.V. | 40 | 37 | 81 | 73 | |||||||||||||
| Other subsidiaries* | 7 | 9 | 14 | 15 | |||||||||||||
| Eliminations | (25 | ) | (29 | ) | (51 | ) | (55 | ) | |||||||||
| Total | 420 | 428 | 836 | 852 | |||||||||||||
| Building Products Distribution: | |||||||||||||||||
| L&W Supply Corporation | 270 | 282 | 513 | 530 | |||||||||||||
| Worldwide Ceilings: | |||||||||||||||||
| USG Interiors, Inc. | 112 | 111 | 222 | 214 | |||||||||||||
| USG International | 55 | 57 | 116 | 114 | |||||||||||||
| CGC Inc. (ceilings) | 18 | 16 | 37 | 33 | |||||||||||||
| Eliminations | (12 | ) | (12 | ) | (25 | ) | (24 | ) | |||||||||
| Total | 173 | 172 | 350 | 337 | |||||||||||||
| Eliminations | (102 | ) | (113 | ) | (217 | ) | (234 | ) | |||||||||
| Total USG Corporation | $ | 761 | $ | 769 | $ | 1,482 | $ | 1,485 | |||||||||
|
Operating Profit (Loss): |
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| North American Gypsum: | |||||||||||||||||
| United States Gypsum Company | $ | (21 | ) | $ | (16 | ) | $ | (50 | ) | $ | (53 | ) | |||||
| CGC Inc. (gypsum) | 2 | 6 | 5 | 13 | |||||||||||||
| USG Mexico, S.A. de C.V. | 5 | 4 | 10 | 7 | |||||||||||||
| Other subsidiaries* | (2 | ) | (5 | ) | (10 | ) | (13 | ) | |||||||||
| Total | (16 | ) | (11 | ) | (45 | ) | (46 | ) | |||||||||
| Building Products Distribution: | |||||||||||||||||
| L&W Supply Corporation | (14 | ) | (22 | ) | (36 | ) | (61 | ) | |||||||||
| Worldwide Ceilings: | |||||||||||||||||
| USG Interiors, Inc. | 15 | 18 | 33 | 30 | |||||||||||||
| USG International | 3 | 2 | 7 | 5 | |||||||||||||
| CGC Inc. (ceilings) | 4 | 3 | 8 | 6 | |||||||||||||
| Total | 22 | 23 | 48 | 41 | |||||||||||||
| Corporate | (15 | ) | (14 | ) | (44 | ) | (37 | ) | |||||||||
| Eliminations | 2 | (1 | ) | (2 | ) | (4 | ) | ||||||||||
| Total USG Corporation | $ | (21 | ) | $ | (25 | ) | $ | (79 | ) | $ | (107 | ) | |||||
| * Includes a shipping company in Bermuda, and a mining operation in Nova Scotia. | |||||||||||||||||
| USG CORPORATION | ||||||||||
| CONSOLIDATED BALANCE SHEETS | ||||||||||
| (dollars in millions) | ||||||||||
| (Unaudited) | ||||||||||
| As of | As of | |||||||||
| June 30, | December 31, | |||||||||
| 2011 | 2010 | |||||||||
| Assets | ||||||||||
| Current Assets: | ||||||||||
| Cash and cash equivalents | $ | 402 | $ | 629 | ||||||
| Short-term marketable securities | 158 | 128 | ||||||||
| Restricted cash | 2 | 4 | ||||||||
| Receivables (net of reserves - $18 and $17) | 380 | 327 | ||||||||
| Inventories | 313 | 290 | ||||||||
| Income taxes receivable | 2 | 3 | ||||||||
| Deferred income taxes | 6 | 6 | ||||||||
| Other current assets | 56 | 50 | ||||||||
| Total current assets | 1,319 | 1,437 | ||||||||
| Long-term marketable securities | 165 | 150 | ||||||||
| Property, plant and equipment (net of accumulated | ||||||||||
| depreciation and depletion - $1,619 and $1,546) | 2,221 | 2,266 | ||||||||
| Other assets | 244 | 234 | ||||||||
| Total Assets | $ | 3,949 | $ | 4,087 | ||||||
| Liabilities and Stockholders' Equity | ||||||||||
| Current Liabilities: | ||||||||||
| Accounts payable | $ | 234 | $ | 218 | ||||||
| Accrued expenses | 278 | 294 | ||||||||
| Current portion of long-term debt | 7 | 7 | ||||||||
| Income taxes payable | 5 | 10 | ||||||||
| Total current liabilities | 524 | 529 | ||||||||
| Long-term debt | 2,299 | 2,301 | ||||||||
| Deferred income taxes | 8 | 7 | ||||||||
| Other liabilities | 591 | 631 | ||||||||
| Commitments and contingencies | ||||||||||
| Stockholders' Equity: | ||||||||||
| Preferred stock | - | - | ||||||||
| Common stock | 10 | 10 | ||||||||
| Treasury stock | - | (55 | ) | |||||||
| Capital received in excess of par value | 2,556 | 2,565 | ||||||||
| Accumulated other comprehensive loss | (13 | ) | (50 | ) | ||||||
| Retained earnings (deficit) | (2,026 | ) | (1,851 | ) | ||||||
| Total stockholders' equity | 527 | 619 | ||||||||
| Total Liabilities and Stockholders' Equity | $ | 3,949 | $ | 4,087 | ||||||
| Other Information: | ||||||||||
| Total cash and cash equivalents and marketable securities | $ | 725 | $ | 907 | ||||||
| Borrowing availability from lines of credit | 198 | 156 | ||||||||
| Total Liquidity | $ | 923 | $ | 1,063 | ||||||
| USG CORPORATION | ||||||||||||||||
| RECONCILIATION of ADJUSTED OPERATING LOSS to REPORTED GAAP OPERATING LOSS | ||||||||||||||||
| (dollars in millions) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Three Months | Six Months | |||||||||||||||
| ended June 30 | ended June 30 | |||||||||||||||
| 2011 | 2010 | 2011 | 2010 | |||||||||||||
| Adjusted Operating Profit (Loss): | ||||||||||||||||
| North American Gypsum | $ | (14 | ) | $ | (5 | ) | $ | (36 | ) | $ | (36 | ) | ||||
| Building Products Distribution | (14 | ) | (21 | ) | (35 | ) | (52 | ) | ||||||||
| Worldwide Ceilings | 22 | 23 | 48 | 41 | ||||||||||||
| Corporate | (15 | ) | (14 | ) | (43 | ) | (37 | ) | ||||||||
| Eliminations | 2 | (1 | ) | (2 | ) | (4 | ) | |||||||||
| Total | (19 | ) | (18 | ) | (68 | ) | (88 | ) | ||||||||
| Restructuring and Long-Lived | ||||||||||||||||
| Asset Impairment Charges: | ||||||||||||||||
| North American Gypsum | 2 | 6 | 9 | 10 | ||||||||||||
| Building Products Distribution | - | 1 | 1 | 9 | ||||||||||||
| Worldwide Ceilings | - | - | - | - | ||||||||||||
| Corporate | - | - | 1 | - | ||||||||||||
| Total | 2 | 7 | 11 | 19 | ||||||||||||
| Reported GAAP Operating Profit (Loss): | ||||||||||||||||
| North American Gypsum | (16 | ) | (11 | ) | (45 | ) | (46 | ) | ||||||||
| Building Products Distribution | (14 | ) | (22 | ) | (36 | ) | (61 | ) | ||||||||
| Worldwide Ceilings | 22 | 23 | 48 | 41 | ||||||||||||
| Corporate | (15 | ) | (14 | ) | (44 | ) | (37 | ) | ||||||||
| Eliminations | 2 | (1 | ) | (2 | ) | (4 | ) | |||||||||
| Total | (21 | ) | (25 | ) | (79 | ) | (107 | ) | ||||||||
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References to Adjusted Operating Loss are non-GAAP measures. Management believes this information provides |
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investors with a more useful comparison of the corporation's ongoing business performance. |
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| UNITED STATES GYPSUM COMPANY | ||||||||||||||||||||||||||||||
| WALLBOARD REALIZED PRICE & SHIPMENTS | ||||||||||||||||||||||||||||||
| Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 | Full Year | ||||||||||||||||||||||||||
| Year | Price | Volume | Price | Volume | Price | Volume | Price | Volume | Price | Volume | ||||||||||||||||||||
| 2011 | $ | 109.15 | 0.99 | $ | 111.55 | 0.99 | ||||||||||||||||||||||||
| 2010 | $ | 106.58 | 1.15 | $ | 114.17 | 1.07 | $ | 114.45 | 1.03 | $ | 111.95 | 0.95 | $ | 111.66 | 4.20 | |||||||||||||||
| Wallboard price reflects amount per one thousand square feet. | ||||||||||||||||||||||||||||||
| Volume expressed in billions of square feet. | ||||||||||||||||||||||||||||||
CONTACT:
USG Corporation
Media Inquiries: 312/436-4356
Investor
Relations: 312/436-4110