Alexandria, VA (PRWEB) July 23, 2014
The Mattress Recycling Council (MRC) is hosting an informal mattress recycling Q&A session during the Las Vegas Market in the ISPA Lounge, Building B, Space 954 on Monday, July 28th between 3:00 and 5:00 p.m. Retailers and other market attendees are encouraged to drop by to get their questions answered and learn more about how the industry is preparing to implement new mattress recycling laws in Connecticut, Rhode Island and California.
The International Sleep Products Association (ISPA) has formed the MRC, a non-profit organization, to develop efficient, cost-effective and consumer friendly mattress recycling programs for all three states. The Connecticut program is expected to take effect in early 2015, and the California and Rhode Island programs will launch in early 2016.
“Mattress retailers and others tell us that they want an opportunity to talk about these laws and get their questions answered,” said Ryan Trainer, president of both ISPA and MRC. “We think this informal Q&A approach will encourage more one-on-one discussions, better fit Las Vegas Market attendees’ busy schedules, and help them get the details they need.”
For additional information about the Mattress Recycling Council, state implementation timelines and the latest legislative developments in mattress recycling, visit http://www.mattressrecyclingcouncil.com.
Andrew Liveris - Chairman, Chief Executive Officer
Thank you, Bill. In summary, the second quarter is another solid proof point of Dow’s progress and the outcome of focused actions we continue to take on the top and bottom line to drive earnings increases across our portfolio. We are delivering on our strategic priorities, which are shown on Slide 8. These priorities are bridging our near-term execution in 2014 with our near-term strategy of generating sustainable returns once our key projects start up in 2015.
I will now describe how we are tracking on priorities 1, 2 and 3 by segment, then I’ll update you on priorities 4 through 6. So turning to Slide 9, by driving productivity actions across the businesses, targeting certain businesses for growth, being strict stewards of capital, and driving EVA and ROC, we are growing margins in all of our segments. For example, in electronic and functional materials and performance plastics, businesses that we have committed to grow, we are growing and our EBITDA margins are expanding as we continue to further penetrate attractive markets such as the ones shown on this slide. In performance materials, a segment that we have committed to improve, our consistent actions over the last many quarters continue to gain traction, resulting in significant EBITDA increases this quarter. We are taking aggressive cost actions and implementing a broader productivity focus to enhance results, particularly in polyurethanes and epoxy. We are seeing the benefit of these collective actions which we put in place 12 months ago now, and with more upside to come.
Our polyurethanes and epoxy teams are hard at work delivering new EBITDA despite business-specific and industry challenges, and when coupled with the upcoming start-up of our PDH investment and our Sadara joint venture, we are well positioned to further restore and enhance our earnings profile across performance materials. In other words, we said we would improve, and we are. We said we would grow, and we are. We are doing all the things we said and more, and through this combination of operational, financial and strategic priorities, we are overcoming known headwinds to deliver stronger year-over-year results.
Andrew Liveris - Chairman, Chief Executive Officer
Yes, I do. Firstly, I think you’ve now seen now three quarters of execution where execution is our mantra. It’s another strong, solid quarter for Dow across our enterprise. Productivity played a huge role. I want to point performance materials and polyurethanes and epoxy – they delivered. We’ve had an intense amount of pressure on those teams, and they’ve delivered in a fairly difficult market environment. They’re getting it through productivity and cost controls, and you can expect that across our entire enterprise. We’re operating as if that’s condition normal for all our businesses.
But having said that, we’re putting a lot of effort into growing, and the projects that you asked about on the call are clear examples of that. The innovations you asked about on the call are other examples of that, all of that moving to improving ROC – 150 basis point increase in ROC year-on-year is going to continue at Dow. All of that to drive shareholder returns and provide more cash remuneration to you, our shareholders. I believe we’re running the best set of integrated businesses on the planet and they will perform to the top of the house expectations on shareholder returns and ROC – that’s our commitment.
(c) 2014, Bloomberg News.
NEW YORK — Warren Buffett could soon have to bid adieu to another of his high-yielding investments from the financial crisis.
Dow Chemical Co. shares rallied past $53.72 Wednesday for the first time in nine years. If they close above that price for 20 trading days in a 30-day window, the chemical maker can convert Buffett's $3 billion preferred stake into common stock.
Swapping the shares would cut dividend payments that Dow has been paying since it turned to Buffett's Berkshire Hathaway to help finance a takeover in 2009 of Rohm & Haas Co. The billionaire investor went on a deal-making spree during the credit crisis, lending billions of dollars to companies including Goldman Sachs and General Electric at historically high rates.
"He built the ark before the storm came up," Luke Sims, chairman of Sims Capital Management, said of Buffett. Having cash during a crisis "and staying power gives you many, many opportunities."
The preferred stake is particularly expensive for the chemical maker with interest rates now near record lows. The securities have an 8.5 percent yield, entitling Berkshire to $255 million in dividends annually. Kuwait's sovereign wealth fund also helped finance the Rohm & Haas purchase and holds $1 billion of the securities.
Converting the preferred stock would be a milestone for Dow Chief Executive Officer Andrew Liveris, who has come under pressure this year from hedge-fund manager Dan Loeb to boost the company's share price. While defending his strategy, the CEO has increased the common-stock dividend, announced buybacks and expanded a program to divest underperforming units.
The actions and higher earnings have helped send Dow shares up 21 percent this year, the second-best result in the 16- company Standard & Poor's 500 Chemicals Index. The company climbed 2.9 percent to $53.84 at 11:49 a.m. in New York after reporting second-quarter earnings Wednesday that beat analysts' estimates on expanding margins.
A boom in U.S. natural gas production since the recession has lowered ingredient costs for Dow and helped boost profit. Net income last year was $4.41 billion, up from $336 million in 2009.
The shares have gained on Loeb's push and investor anticipation of earnings from new projects, John Roberts, a New York-based analyst at UBS Securities, said by phone. Dow next year will be turning more gas into plastics and chemicals on the U.S. Gulf Coast and will be starting its approximately $20 billion Sadara joint venture with Saudi Arabian Oil Co.
"People have come to view the dilution from the preferreds as a manageable issue," based on prospects for high earnings and share buybacks, Roberts said.
Berkshire and the Kuwait Investment Authority would be entitled to 96.8 million common shares, according to terms in the chemical maker's most recent annual report.
The annual dividend for Berkshire on common shares would be about $107 million based on the current payout.
Some of Buffett's other crisis-era investments have been wound down. In October, Mars Inc. said it repaid $4.4 billion in bonds that Berkshire bought to help the candy maker acquire Wm. Wrigley Jr. Co.
That same month, Buffett received common equity stakes in Goldman Sachs and GE to settle warrants he received under deals five years earlier. Berkshire committed a combined $8 billion to the companies in 2008 to help them shore up capital and restore market confidence after Lehman Brothers collapsed. Both Goldman Sachs and GE repaid the money at a premium in 2011.
The redemptions have caused Berkshire's cash pile to swell at a time when fixed-income investments have historically low yields. Buffett has responded by pursuing acquisitions, like last year's purchase of the largest electric utility in Nevada.
"His main goal is to buy more operating businesses," said Sims, whose firm counts Omaha, Nebraska-based Berkshire among its largest holdings. "He'll find plenty of places to put the money to work."
Sales in the Chemicals segment rose slightly compared with the first half of 2013. Sales volumes increased in all divisions; the Petrochemicals division in North America posted particularly considerable volumes growth. Lower sales prices and negative currency effects dampened this development. Earnings rose slightly, especially as a result of higher margins in the Petrochemicals division.
Sales were slightly down in the Performance Products segment despite increased volumes. This was due to negative currency effects. Sales prices matched the level of the first half of the previous year. Our strict fixed cost management and restructuring measures contributed to a decrease in fixed costs and a considerable rise in earnings.
With prices stable, we posted slightly higher sales in the Functional Materials & Solutions segment on account of increased volumes. Strong demand from the automotive industry contributed significantly to this. Currency effects had a negative impact on sales development. In the Construction Chemicals division, sales declined considerably as a result of portfolio effects, as well. We considerably raised our earnings, primarily through higher volumes and reduced fixed costs.
Sales in the Agricultural Solutions segment grew slightly compared with the first half of 2013. We increased volumes and sales prices, more than compensating for negative currency effects. There was a slight drop in earnings, which was largely the result of negative currency influences and higher research expenses.
In the Oil & Gas segment, sales matched the level of the previous first half. Sales rose considerably in the Exploration & Production business sector, primarily due to the activities in Norway acquired from Statoil. However, sales declined slightly in the Natural Gas Trading business sector, mainly because of lower gas prices. Earnings slightly exceeded the level of the first half of 2013 due to higher volumes.
Sales fell considerably in Other, mostly as a result of lower sales of raw materials and decreased plant availability. Income from operations before special items declined considerably. Currency losses and higher charges for the long-term incentive program were largely responsible for this.
Special items in EBIT totaled €75 million in the first half of 2014. This was predominantly attributable to special income from the divestiture of our shares in non-BASF-operated oil and gas fields in the British North Sea. The previous first half had included special items in EBIT of minus €104 million. These resulted from the integration of Becker Underwood and Pronova BioPharma in addition to various restructuring measures.
Compared with the first half of the previous year, EBIT rose by €326 million to €4,268 million. EBITDA grew by €321 million to €5,664 million.
Posted: Wednesday, July 23, 2014 10:02 am
By PHIL GARBER, MANAGING EDITOR | 0 comments
MOUNT OLIVE TWP. – If Jeff Stadelman closes his eyes, he can see stores, restaurants, professional office, apartments and condominiums replacing the BASF building, once a veritable godsend and now the town’s perennial white elephant.
Stadelman, owner of the Wine Rack in Flanders, is chair of the town’s economic development committee and he has been leading efforts to research the best and most realistic way to develop the BASF property.
The building, once the town’s leading property taxpayer, has been empty since 2004 when the multinational chemical company built a new North American headquarters in Florham Park.
The building and 97 acres tract was sold in 2006 to BPG Properties, a private equity real estate fund in Pennsylvania. But then the recession hit and the demand for office space vanished as the property was foreclosed in 2010 by Wells Fargo which has since been unable to sell it.
Stadelman said he was visiting friends in North Carolina last year when he learned about Birkdale Village, a mixed use community in Huntersville, N.C., also known as a “lifestyle center.”
Birkdale Village has restaurants, stores, cafes, apartments, town homes, and houses. A gym, a movie theater, a supermarket, a golf course, a greenway, an express bus park and ride, and Lake Norman are all within walking distance for the residents of Birkdale Village.
Stadelman said that after seeing Birkdale Village he thought a similar lifestyle center would be ideal at the BASF tract, which is not far from Budd Lake, the state’s largest natural lake. He said he could envision the BASF building replaced by ground floor retail and restaurants, professional offices on a second floor and apartments and condominiums on the third floor.
Stadelman said lifestyle centers appeal to many of today’s younger professionals who want a relatively inexpensive place to live. It also is appealing to corporations that are trying to lure and appeal to such young professionals. Smaller housing also is desirable to senior citizens and retirees who want to downsize. And moving out of larger homes would make the housing available to families who want to live in Mount Olive.
“The new “millenials” want to live simply where they can live, work and play,” Stadelman said. “A lot of people want to stay in town but don’t want to keep their homes.”
Stadelman said redeveloping the property or selling it for office space is unlikely because it is too far west of New York City. He said 30 percent of the office space in northern New Jersey is vacant while 17 percent of the industrial space is empty.
The BASF building is particularly unmarketable because it does not have the extensive light and large windows that are sought by today’s businesses, Stadelman said.
A lifestyle center would provide a customer base to retain the new stores and businesses, Stadelman said. The building is also adjacent to 57 undeveloped acres owned by the township and adjacent to Stephens State Park, another draw to younger residents. It also is not far from the recreated, 17th century Waterloo Village.
“By having this center you not only create business retention but you’re giving a broader form of living and a town center, which is something Mount Olive has never had,” Stadelman said.
Mayor Rob Greenbaum said the idea of a lifestyle center is appealing. And Jim Jones, executive director of the Morris County Economic Development Committee, also told Stadelman that “lifestyle centers are where you want to look.”
At the request of Wells Fargo, the Urban Land Institute studied the BASF property and also concluded that a mixed use would be the most marketable use of the property. A 2006 report by CNN also noted that the proliferation of lifestyle centers in the United States accelerated in the 2000s, with number going from 30 in 2002 to 120 at the end of 2004.
Stadelman said demolishing the building would cost an estimated $2 per square foot for a total cost of about $2 million for the 970,000 square foot building. He said the demolition cost would be outweighed by the extensive infrastructure improvements, including water, sewer, roads and a large parking garage. A new lifestyle center also would compliment a similar project being planned at the Netcong rail station.
Stadelman said he has spoken to several developers and that one is considering the feasibility of building a lifestyle center while a second developer said he would pass the idea on to a section that looks into alternative developments.
The potential for sale of the former BASF headquarters along with 57 acres of adjacent, undeveloped land now owned by the town also got a boost in 2013 when the state changed the planning designation on the land, much to the chagrin of environmental groups and more than 1,000 people who signed a petition objecting to the change.
The State Planning Commission unanimously approved the township‘s request to remove environmental restrictions from a total of 416 acres in the International Trade Center. The new designation means the BASF property is no longer considered as environmentally sensitive and therefore could open it up to significant state tax incentives for a new tenant or purchaser.
Fortune 500 packaging company Sealed Air Corp. will consolidate management operations from several states and relocate its New Jersey headquarters to the Charlotte area, where it plans to employ nearly 1,300 jobs in three years.
A North Carolina committee that approves the state's main tax break to attract businesses on Wednesday approved up to $36 million over 12 years if the company meets job and investment targets. The Elmwood Park, New Jersey-based company also will receive at least $5 million more in incentives from state and local governments.
Sealed Air was expected to announce the move with North Carolina officials later Wednesday in Charlotte. Sealed Air spokesman Ken Aurichio said the company would answer questions after an announcement later Wednesday.
The maker of Bubble Wrap protective cushioning, food packaging and cleaning products will consolidate some operations from Connecticut, Wisconsin, Massachusetts and New Jersey into a new headquarters complex in the Charlotte area costing more than $50 million, North Carolina Commerce Department spokeswoman Kim Genardo said. Genardo said a site hasn't been determined.
The company had narrowed its search to Greenville, South Carolina, and Charlotte before selecting its new headquarters, Genardo said.
Sealed Air employs about 25,000 people in 175 countries.
Air Products & Chemicals Inc. (APD)’s new chief executive officer said the industrial gases producer, targeted by activist investor Bill Ackman, needs to change its corporate culture and make better investment decisions.
Air Products will focus on projects that generate more cash flow and on improving returns on invested capital, Seifi Ghasemi said today on an earnings conference call, his first public comments since joining the company July 1.
Ghasemi said workers need a greater sense of urgency. He plans to decentralize the Allentown, Pennsylvania-based company’s decision-making to improve its entrepreneurial capabilities. The stock rose to its highest since at least 1980.
“Simplicity, speed of execution and empowerment are some of the issues we will address,” he said.
Ghasemi, 69, was hired from Rockwood Holdings Inc. after Ackman’s Pershing Square Capital Management LP demanded changes at Air Products, which was underperforming competitor Praxair Inc. (PX) The CEO said today that Air Products can retake its position as industry leader with a strategy that he’ll describe in greater detail in mid-September.
Rockwood sold assets while Ghasemi was in charge and on July 15, less than a month after his departure, announced it would be acquired by Albemarle Corp. No asset sales at Air Products are imminent, he said today.
“Nothing is for sale right now,” Ghasemi said. “It would be premature to take action before you get these businesses performing to the best of their ability.”
Air Products said today that earnings from continuing operations were $1.46 in the fiscal third quarter. That exceeded the $1.45 average estimate of 19 analysts in a Bloomberg survey.
The shares rose 3.2 percent to $134.48 as of 12:59 p.m. in New York. They earlier climbed to $135.51, the highest since at least July 1980, according to data compiled by Bloomberg.
By Erin McCarthy
Dow Chemical Co. said its second-quarter sales rose a better-than-expected 2% as the company reported growth in all its operating segments.
Dow, which has faced pressure from activist investor Daniel Loeb, emphasized Wednesday its increasing results and the $3 billion it has returned to shareholders so far this year.
"Our results reflect excellent progress against Dow's near-term priorities, and clearly illustrate our ongoing drive to execute self-help actions that are delivering growth on both the top and bottom line," Chairman and Chief Executive Andrew N. Liveris said in a news release.
Mr. Loeb of Third Point has been pushing Dow to split off its petrochemicals business from segments that make specialty chemicals for agriculture, food, pharmaceuticals and electronics. However, Dow has maintained that breaking up the company would hurt overall operations and shareholder value.
Nonetheless, the company has said it plans to shed this year up to $2 billion of low-margin businesses, such as commodity chemicals production.
Dow's improving results and streamlining strategy has helped the company's stock to rise 51% over the past year. In premarket trading, the stock rose another 1.7% to $53.20.
For the second quarter, Dow reported a profit of $967 million, or 73 cents a share, down sharply from year-ago earnings of $2.43 billion, or $1.87 cents a share, which included a pretax gain of $2.16 billion from damages awarded to the company in an arbitration proceeding.
Excluding special items, per-share earnings rose to 74 cents from 64 cents. Revenue increased to 14.92 billion from $14.58 billion.
Analysts polled by Thomson Reuters expected per-share profit of 72 cents and revenue of $14.82 billion.
Sales growth in the quarter was led by Dow's electronic and functional materials segment, which reported a 5% increase in revenue to $1.2 billion.
Sales in its performance plastics segment increased about 2% to $3.75 billion, while its coatings and infrastructure solutions and agricultural sciences segments each reported sales growth of about 3%, to $1.95 billion and $1.91 billion, respectively.