Press Release Details

Table 1

Owens Corning and Subsidiaries

Consolidated Statements of Earnings (Loss)

 (unaudited)

(in millions, except per share amounts)

Three Months Ended

Mar. 31,

2013

2012

NET SALES

$

1,350

$

1,346

COST OF SALES

1,137

1,160

Gross margin

213

186

OPERATING EXPENSES

Marketing and administrative expenses

133

137

Science and technology expenses

18

19

Charges related to cost reduction actions

1

34

Other expenses

4

8

Total operating expenses

156

198

EARNINGS (LOSS) BEFORE INTEREST AND TAXES

57

(12)

Interest expense, net

29

28

EARNINGS (LOSS) BEFORE TAXES

28

(40)

Less: Income tax expense

6

5

Equity in net earnings of affiliates

-

-

NET EARNINGS (LOSS)

22

(45)

Less: Net earnings attributable to noncontrolling interests

-

1

NET EARNINGS (LOSS) ATTRIBUTABLE TO OWENS

CORNING

$

22

$

(46)

EARNINGS (LOSS) PER COMMON SHARE ATTRIBUTABLE TO

OWENS CORNING COMMON STOCKHOLDERS

Basic

$

0.19

$

(0.38)

Diluted

$

0.18

$

(0.38)

WEIGHTED-AVERAGE COMMON SHARES

Basic

118.5

121.1

Diluted

119.6

121.1

Owens Corning follows the authoritative guidance referring to "Noncontrolling Interest in Consolidated Financial Statements," effective January 1, 2009, which, among other things, changed the presentation format and certain captions of the Consolidated Statements of Earnings and Consolidated Balance Sheets. Owens Corning uses the captions recommended by this standard in its Consolidated Financial Statements such as net earnings attributable to Owens Corning and diluted earnings per common share attributable to Owens Corning common stockholders.  However, in the preceding release Owens Corning has shortened this language to net earnings and earnings per share (or a slight variation thereof), respectively.

Table 2

Owens Corning and Subsidiaries

EBIT Reconciliation Schedules

(unaudited)

For purposes of internal review of Owens Corning's year-over-year operational performance, management excludes from net earnings attributable to Owens Corning certain items it believes are not the result of current operations.  The adjusted financial measure resulting from these adjustments is used internally by Owens Corning for various purposes, including reporting results of operations to the Board of Directors, analysis of performance, and related employee compensation measures.  Although management believes that these adjustments result in a measure that provides it a useful representation of its operational performance, the adjusted measure should not be considered in isolation or as a substitute for net earnings attributable to Owens Corning as prepared in accordance with accounting principles generally accepted in the United States.

Adjusting items are shown in the table below (in millions):

Three Months Ended

March 31,

2013

2012

Charges related to cost reduction actions and related items

$

(9)

$

(55)

Losses related to Hurricane Sandy

(11)

-

Total adjusting items

$

(20)

$

(55)

Three Months Ended

March 31,

2013

2012

NET EARNINGS (LOSS) ATTRIBUTABLE TO OWENS CORNING

$

22

$

(46)

Less: Net earnings attributable to noncontrolling interests

-

1

NET EARNINGS (LOSS)

22

(45)

Income tax expense

6

5

EARNINGS (LOSS) BEFORE TAXES

28

(40)

Interest expense, net

29

28

EARNINGS (LOSS) BEFORE INTEREST AND TAXES

57

(12)

Less: adjusting items from above

(20)

(55)

ADJUSTED EBIT

$

77

$

43

Table 3

Owens Corning and Subsidiaries

EPS Reconciliation Schedules

(unaudited)

(in millions, except per share data)

For purposes of internal review of Owens Corning's year-over-year operational performance, management excludes from net earnings attributable to Owens Corning certain items it believes are not the result of current operations. The adjusted financial measures resulting from these adjustments are used internally by Owens Corning for various purposes, including reporting results of operations to the Board of Directors, analysis of performance and related employee compensation measures. Although management believes that these adjustments result in measures that provide it a useful representation of its operational performance, the adjusted measures should not be considered in isolation or as a substitute for net earnings attributable to Owens Corning as prepared in accordance with accounting principles generally accepted in the United States.

A reconciliation from net earnings attributable to Owens Corning to Adjusted Earnings and a reconciliation from diluted earnings per share to adjusted diluted earnings per share are shown in the tables below:

Three  Months Ended

March 31,

2013

2012

RECONCILIATION TO ADJUSTED EARNINGS

Net earnings (loss) attributable to Owens Corning

$

22

$

(46)

Adjustment to remove adjusting items net of tax

15

43

Adjustment to tax expense to reflect pro forma tax rate*

(2)

14

ADJUSTED EARNINGS

$

35

$

11

RECONCILIATION TO ADJUSTED DILUTED EARNINGS PER SHARE

ATTRIBUTABLE TO OWENS CORNING COMMON STOCKHOLDERS

DILUTED EARNINGS (LOSS) PER COMMON SHARE ATTRIBUTABLE

TO OWENS CORNING COMMON STOCKHOLDERS

$

0.18

$

(0.38)

Adjustment to remove adjusting items net of tax

0.13

0.36

Adjustment to tax expense to reflect a pro forma tax rate*

(0.02)

0.11

ADJUSTED DILUTED EARNINGS PER SHARE

ATTRIBUTABLE TO OWENS CORNING COMMON STOCKHOLDERS

$

0.29

$

0.09

RECONCILIATION TO DILUTED SHARES OUTSTANDING

Weighted-average shares outstanding

used for basic earnings per share

118.5

121.1

Non-vested restricted shares

0.6

-

Options to purchase common stock

0.5

-

Diluted shares outstanding

119.6

121.1

* Pro forma tax rate used in 2013 was 26.5% (midpoint of guidance), and, 23% in 2012 as this was the adjusted effective tax rate of the Company in 2012.

Table 4

Owens Corning and Subsidiaries

Consolidated Balance Sheets

(unaudited)

(in millions)

Mar. 31,

Dec. 31,

ASSETS

2013

2012

CURRENT ASSETS

Cash and cash equivalents

$

62

$

55

Receivables, less allowances of $16 at Mar. 31,2013 and $17 at Dec. 31, 2012

884

600

Inventories

776

786

Other current assets

195

171

Total current assets

1,917

1,612

Property, plant and equipment, net

2,865

2,903

Goodwill

1,143

1,143

Intangible assets

1,038

1,045

Deferred income taxes

603

604

Other non-current assets

251

261

TOTAL ASSETS

$

7,817

$

7,568

LIABILITIES AND EQUITY

CURRENT LIABILITIES

Accounts payable and accrued liabilities

$

920

$

897

Short-term debt

10

5

Long-term debt - current portion

4

4

Total current liabilities

934

906

Long-term debt, net of current portion

2,301

2,076

Pension plan liability

462

480

Other employee benefits liability

271

274

Deferred income taxes

36

38

Other liabilities

219

219

OWENS CORNING STOCKHOLDERS' EQUITY

Preferred stock, par value $0.01 per share (a)

-

-

Common stock, par value $0.01 per share (b)

1

1

Additional paid in capital

3,941

3,925

Accumulated earnings

473

451

Accumulated other comprehensive deficit

(375)

(364)

Cost of common stock in treasury (c)

(483)

(475)

Total Owens Corning stockholders' equity

3,557

3,538

Noncontrolling interests

37

37

Total equity

3,594

3,575

TOTAL LIABILITIES AND EQUITY

$

7,817

$

7,568

(a)

10 shares authorized; none issued or outstanding at Mar. 31,2013 and Dec. 31, 2012

(b)

400 shares authorized; 135.5 issued and 118.9 outstanding at Mar. 31,2013; 135.6 issued and 118.3 outstanding at Dec. 31, 2012

(c)

16.6 shares at Mar. 31,2013 and 17.3 shares at Dec. 31, 2012

Table 5

Owens Corning and Subsidiaries

Consolidated Statements of Cash Flows

(unaudited)

(in millions)

Three Months Ended

Mar. 31,

2013

2012

NET CASH FLOW USED FOR OPERATING ACTIVITIES

Net earnings (loss)

$

22

$

(45)

Adjustments to reconcile net earnings to cash provided by operating activities:

Depreciation and amortization

78

89

Gain on sale of businesses and fixed assets

-

(1)

Deferred income taxes

-

6

Provision for pension and other employee benefits liabilities

6

11

Stock-based compensation expense

7

7

Other non-cash

(2)

(4)

Change in working capital

(271)

(232)

Pension fund contribution

(12)

(18)

Payments for other employee benefits liabilities

(5)

(6)

Other

(2)

-

Net cash flow used for operating activities

(179)

(193)

NET CASH FLOW USED FOR INVESTING ACTIVITIES

Additions to plant and equipment

(45)

(72)

Proceeds from the sale of assets or affiliates

-

4

Net cash flow used for investing activities

(45)

(68)

NET CASH FLOW PROVIDED BY FINANCING ACTIVITIES

Proceeds from senior revolving credit and receivables securitization facilities

558

626

Payments on senior revolving credit and receivables securitization facilities

(331)

(352)

Payments on long-term debt

-

(2)

Net increase (decrease) in short-term debt

5

(6)

Purchases of treasury stock

(8)

(5)

Other

8

5

Net cash flow provided by financing activities

232

266

Effect of exchange rate changes on cash

(1)

1

Net increase in cash and cash equivalents

7

6

Cash and cash equivalents at beginning of period

55

52

CASH AND CASH EQUIVALENTS AT END OF PERIOD

$

62

$

58

Table 6

Owens Corning and Subsidiaries

Segment and Business Information

(unaudited)

Composites

The table below provides a summary of net sales, EBIT and depreciation and amortization expense for the Composites segment (in millions):

Three Months Ended

Mar. 31,

2013

2012

Net sales

$

459

$

476

     % change from prior year

-4%

-3%

EBIT

$

9

$

23

     EBIT as a % of net sales

2%

5%

Depreciation and amortization expense

$

32

$

30

Building Materials

The table below provides a summary of net sales, EBIT and depreciation and amortization expense (in millions) for the Building Materials segment and our businesses within this segment (in millions):

Three Months Ended

Mar. 31,

2013

2012

Net sales

Insulation

$

330

$

331

Roofing

607

588

Total Building Materials

$

937

$

919

     % change from prior year

2%

17%

EBIT

Insulation

$

(21)

$

(34)

Roofing

119

83

Total Building Materials

$

98

$

49

     EBIT as a % of net sales

10%

5%

Depreciation and amortization expense

Insulation

$

26

$

25

Roofing

10

9

Total Building Materials

$

36

$

34

Table 7

Owens Corning and Subsidiaries

Corporate, Other and Eliminations

(unaudited)

Corporate, Other and Eliminations

The table below provides a summary of EBIT and depreciation and amortization expense for the Corporate, Other and Eliminations category (in millions):

Three Months Ended

Mar. 31,

2013

2012

Charges related to cost reduction actions and related items

$

(9)

$

(55)

Losses related to Hurricane Sandy

(11)

-

General corporate expense and other

(30)

(29)

EBIT

$

(50)

$

(84)

Depreciation and amortization

$

10

$

25