Company Grows Net Earnings by 52%; Achieves Record Quarterly EBIT
-
Composites delivered record quarterly EBIT with 14 percent EBIT margins
-
Roofing grew quarterly EBIT by $79 million; delivered 25 percent EBIT
margins
-
Insulation delivered 20th consecutive quarter of EBIT growth
-
Company expects full-year adjusted EBIT of $700 million or more
TOLEDO, Ohio--(BUSINESS WIRE)--
Owens Corning (NYSE: OC) today reported consolidated net sales of $1.55
billion in the second quarter of 2016, compared to net sales of $1.40
billion in the prior-year period.
The company reported net earnings of $138 million, or $1.19 per diluted
share, in the second quarter of 2016, compared with net earnings of $91
million, or $0.77 per diluted share, in the same period in 2015. Second
quarter 2016 adjusted earnings were $150 million, or $1.29 per diluted
share, compared with $90 million, or $0.76 per diluted share, during the
same period one year ago (See Use of Non-GAAP Measures).
“Owens Corning posted a record quarter and continues to perform at a
very high level,” said Chairman and Chief Executive Officer Mike Thaman.
“The Composites business continues its momentum. The Roofing business
executed well in favorable market conditions and delivered an
outstanding quarter. The Insulation business achieved another quarter of
EBIT growth.
“The strength of our portfolio and strong execution delivered
outstanding profitability and cash performance in the quarter,” Thaman
said.
Consolidated Second-Quarter Results and Other
Highlights
-
Owens Corning continues to perform at a high level of safety with a
recordable incident rate of 0.53 for the first six months, relatively
flat with the comparable period in 2015. Nearly three quarters of
company facilities have operated this year without a recordable injury.
-
Reported EBIT for the second quarter was $240 million, compared with
$156 million during the same period in 2015. Adjusted earnings before
interest and taxes (EBIT) in the second quarter of 2016 were $253
million, up from $156 million in 2015 (See Table 2).
-
For the first half, cash from operating activities improved by $220
million year-over-year as a result of improved earnings and working
capital performance. Free cash flow improved $217 million over the
same period in 2015 (See Table 8).
-
The company plans to invest $110 million in the expansion of its
composites operations in India to serve the growing Indian market.
This investment furthers the low-delivered cost model of the business
while providing flexibility to minimize future capital investments in
higher cost facilities.
-
During the second quarter, Owens Corning repurchased one million
shares of its common stock for $48 million. As of June 30, 2016, 2.8
million shares remained available for repurchase under the company's
current authorization.
-
The agreement to acquire the non-wovens and fabrics business of
Ahlstrom was terminated due to challenges associated with obtaining
regulatory clearance in Germany.
Outlook
The company expects an environment consistent with consensus
expectations for U.S. housing starts and moderate global growth.
In Composites, the company expects continued growth in the glass fiber
market, driven by moderate global industrial production growth. The
company continues to expect EBIT growth of at least $30 million for the
business in 2016.
In Roofing, the company now expects low double-digit growth of the U.S.
asphalt shingle market for 2016. First-half industry shipments were up
slightly more than 20 percent, and the company anticipates second-half
shipments to be slightly down to flat versus prior year. The InterWrap
acquisition contributed strongly in the second quarter and is now
expected to deliver at least $30 million of EBIT in 2016.
In Insulation, the company continues to expect slightly negative revenue
growth and relatively flat margins for the full year.
The company estimates an effective tax rate of 32 percent to 34 percent,
and a cash tax rate of 10 percent to 12 percent on adjusted pre-tax
earnings, due to the company’s $2.0 billion U.S. tax net operating loss
carryforward.
The company expects general corporate expenses to be $120 million to
$130 million in 2016. Capital additions in 2016 are expected to total
approximately $385 million, including an estimated $50 million for the
completion of the previously announced mineral fiber insulation facility
in Joplin, Missouri. Interest expense is expected to be about $115
million, including the financing of the InterWrap acquisition.
For the full-year 2016, the company expects adjusted EBIT of $700
million or more.
Next Earnings Announcement
Third-quarter 2016 results will be announced on Wednesday, October 26,
2016.
Second-Quarter 2016 Conference Call and
Presentation
Wednesday, July 27, 2016
11 a.m. Eastern Time
All Callers
Live dial-in telephone number: U.S. 1.888.317.6003; Canada
1.866.284.3684; and other international +1.412.317.6061.
Entry
number: 729-9192 (Please dial in 10-15 minutes before conference call
start time)
Live webcast: http://services.choruscall.com/links/oc160727
Telephone and Webcast Replay
Telephone replay will be available one hour after the end of the call
through August 4, 2016. In the U.S., call 1.877.344.7529. In Canada,
call 1.855.669.9658. In other international locations, call
+1.412.317.0088.
Conference replay number: 100-885-23
Replay
available at http://services.choruscall.com/links/oc160727
Webcast
replay available until July 27, 2017
About Owens Corning
Owens Corning (NYSE: OC) develops, manufactures, and markets insulation,
roofing, and fiberglass composites. Global in scope and human in scale,
the company’s market-leading businesses use their deep expertise in
materials, manufacturing and building science to develop products and
systems that save energy and improve comfort in commercial and
residential buildings. Through its glass reinforcements business, the
company makes thousands of products lighter, stronger and more durable.
Ultimately, Owens Corning people and products make the world a better
place. Based in Toledo, Ohio, Owens Corning posted 2015 sales of $5.4
billion and employs about 16,000 people in 25 countries. It has been a
Fortune 500® company for 62 consecutive years. For more
information, please visit www.owenscorning.com.
Use of Non-GAAP Measures
Owens Corning uses non-GAAP measures in its earnings press release that
are intended to supplement investors’ understanding of the Company’s
financial information. These non-GAAP measures include adjusted EBIT,
adjusted earnings, adjusted diluted earnings per share attributable to
Owens Corning common stockholders (“adjusted EPS”), adjusted pre-tax
earnings and free cash flow. When used to report historical financial
information, reconciliations of these non-GAAP measures to the
corresponding GAAP measures are included in the financial tables of this
press release. Specifically see Table 2 for adjusted EBIT, Table 3 for
adjusted earnings and adjusted EPS, and Table 8 for free cash flow.
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
representative of ongoing operations. The non-GAAP financial measures
resulting from these adjustments (including adjusted EBIT, adjusted
earnings, adjusted EPS and adjusted pre-tax earnings) 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. Management
believes that these adjustments result in a measure that provides a
useful representation of its operational performance; however 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 GAAP.
Free cash flow is a measure used by investors, financial analysts and
management to help evaluate the Company's ability to use cash to pursue
opportunities that enhance shareholder value. Free cash flow is not a
measure of residual cash flow available for discretionary expenditures
due to the Company’s mandatory debt service requirements. Free cash flow
is used internally by the Company for various purposes, including
reporting results of operations to the Board of Directors of the Company
and analysis of performance. Management believes that this measure
provides a useful representation of our operational performance; however
the measure should not be considered in isolation or as a substitute for
net cash flow provided by operating activities as prepared in accordance
with GAAP.
When the Company provides forward-looking expectations for non-GAAP
measures (adjusted EBIT and adjusted pre-tax earnings), the most
comparable GAAP measures and a reconciliation between the non-GAAP
expectations and the corresponding GAAP measures are generally not
available without unreasonable effort due to the variability, complexity
and limited visibility of the adjusting items that would be excluded
from the non-GAAP measures in future periods. The variability in timing
and amount of adjusting items could have significant and unpredictable
effect on our future GAAP results.
Forward Looking Statements
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. These forward-looking
statements are subject to risks, uncertainties and other factors and
actual results may differ materially from those results projected in the
statements. These risks, uncertainties and other factors include,
without limitation: relationships with key customers; levels of
residential and commercial construction activity; competitive and
pricing factors; levels of global industrial production; demand for our
products; industry and economic conditions that affect the market and
operating conditions of our customers, suppliers or lenders; foreign
exchange and commodity price fluctuations, our level of indebtedness;
weather conditions; availability and cost of credit; availability and
cost of energy and raw materials; issues involving implementation and
protection of information technology systems; domestic and international
economic and political conditions, including new legislation or other
governmental actions; our ability to utilize net operating loss
carry-forwards; research and development activities and intellectual
property protection; interest rate movements; labor disputes, legal and
regulatory proceedings, including litigation and environmental actions;
uninsured losses; issues related to acquisitions, divestitures and
joint ventures; achievement of expected synergies, cost reductions
and/or productivity improvements; defined benefit plan funding
obligations; and factors detailed from time to time in the company’s
Securities and Exchange Commission filings. The information in this news
release speaks as of July 27, 2016, and is subject to change. The
company does not undertake any duty to update or revise forward-looking
statements except as required by federal securities laws. Any
distribution of this news release after that date is not intended and
should not be construed as updating or confirming such information.
Owens Corning Investor Relations News
|
Table 1
Owens Corning and Subsidiaries
Consolidated
Statements of Earnings
(unaudited)
(in
millions, except per share amounts)
|
|
|
|
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
NET SALES
|
|
$
|
1,545
|
|
|
$
|
1,403
|
|
|
$
|
2,776
|
|
|
$
|
2,606
|
|
|
COST OF SALES
|
|
1,129
|
|
|
1,095
|
|
|
2,088
|
|
|
2,089
|
|
|
Gross margin
|
|
416
|
|
|
308
|
|
|
688
|
|
|
517
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
Marketing and administrative expenses
|
|
151
|
|
|
130
|
|
|
285
|
|
|
259
|
|
|
Science and technology expenses
|
|
21
|
|
|
18
|
|
|
40
|
|
|
35
|
|
|
Other expenses, net
|
|
4
|
|
|
4
|
|
|
7
|
|
|
9
|
|
|
Total operating expenses
|
|
176
|
|
|
152
|
|
|
332
|
|
|
303
|
|
|
EARNINGS BEFORE INTEREST AND TAXES
|
|
240
|
|
|
156
|
|
|
356
|
|
|
214
|
|
|
Interest expense, net
|
|
29
|
|
|
26
|
|
|
52
|
|
|
52
|
|
|
Gain on extinguishment of debt
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|
EARNINGS BEFORE TAXES
|
|
211
|
|
|
135
|
|
|
304
|
|
|
167
|
|
|
Income tax expense
|
|
73
|
|
|
44
|
|
|
107
|
|
|
57
|
|
|
Equity in net earnings of affiliates
|
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
NET EARNINGS
|
|
139
|
|
|
92
|
|
|
198
|
|
|
111
|
|
|
Net earnings attributable to noncontrolling interests
|
|
1
|
|
|
1
|
|
|
3
|
|
|
2
|
|
|
NET EARNINGS ATTRIBUTABLE TO OWENS CORNING
|
|
$
|
138
|
|
|
$
|
91
|
|
|
$
|
195
|
|
|
$
|
109
|
|
|
EARNINGS PER COMMON SHARE ATTRIBUTABLE TO OWENS CORNING COMMON
STOCKHOLDERS
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
1.20
|
|
|
$
|
0.77
|
|
|
$
|
1.69
|
|
|
$
|
0.93
|
|
|
Diluted
|
|
$
|
1.19
|
|
|
$
|
0.77
|
|
|
$
|
1.67
|
|
|
$
|
0.92
|
|
|
Dividend
|
|
$
|
0.18
|
|
|
$
|
0.17
|
|
|
$
|
0.36
|
|
|
$
|
0.34
|
|
|
WEIGHTED AVERAGE COMMON SHARES
|
|
|
|
|
|
|
|
|
|
Basic
|
|
115.1
|
|
|
117.5
|
|
|
115.3
|
|
|
117.6
|
|
|
Diluted
|
|
116.4
|
|
|
118.3
|
|
|
116.5
|
|
|
118.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 2
Owens Corning and Subsidiaries
EBIT
Reconciliation Schedules
(unaudited)
|
|
|
|
|
|
|
|
Adjusting items are shown in the table below (in millions):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended June 30,
|
|
Six Months
Ended June 30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Restructuring costs
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
|
$
|
(2
|
)
|
|
Acquisition-related costs for InterWrap and Ahlstrom transactions
|
|
(3
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
Recognition of InterWrap inventory fair value step-up
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
Total adjusting items
|
|
$
|
(13
|
)
|
|
$
|
—
|
|
|
$
|
(15
|
)
|
|
$
|
(2
|
)
|
|
|
|
|
|
|
|
The reconciliation from net earnings attributable to Owens Corning
to Adjusted EBIT is shown in the table below (in millions):
|
|
|
|
|
|
|
|
|
|
Three Months
Ended June 30,
|
|
Six Months
Ended June 30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
NET EARNINGS ATTRIBUTABLE TO OWENS CORNING
|
|
$
|
138
|
|
|
$
|
91
|
|
|
$
|
195
|
|
|
$
|
109
|
|
|
Less: Net earnings attributable to noncontrolling interests
|
|
1
|
|
|
1
|
|
|
3
|
|
|
2
|
|
|
NET EARNINGS
|
|
139
|
|
|
92
|
|
|
198
|
|
|
111
|
|
|
Equity in net earnings of affiliates
|
|
1
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
Income tax expense
|
|
73
|
|
|
44
|
|
|
107
|
|
|
57
|
|
|
EARNINGS BEFORE TAXES
|
|
211
|
|
|
135
|
|
|
304
|
|
|
167
|
|
|
Interest expense, net
|
|
29
|
|
|
26
|
|
|
52
|
|
|
52
|
|
|
Gain on extinguishment of debt
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
(5
|
)
|
|
EARNINGS BEFORE INTEREST AND TAXES
|
|
240
|
|
|
156
|
|
|
356
|
|
|
214
|
|
|
Less: adjusting items from above
|
|
(13
|
)
|
|
—
|
|
|
(15
|
)
|
|
(2
|
)
|
|
ADJUSTED EBIT
|
|
$
|
253
|
|
|
$
|
156
|
|
|
$
|
371
|
|
|
$
|
216
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 3
Owens Corning and Subsidiaries
EPS
Reconciliation Schedules
(unaudited)
(in
millions, except per share data)
|
|
|
|
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
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
RECONCILIATION TO ADJUSTED EARNINGS
|
|
|
|
|
|
|
|
|
|
Net earnings attributable to Owens Corning
|
|
$
|
138
|
|
|
$
|
91
|
|
|
$
|
195
|
|
|
$
|
109
|
|
|
Adjustment to remove adjusting items
|
|
13
|
|
|
—
|
|
|
15
|
|
|
2
|
|
|
Adjustment to remove tax benefit on adjusting items (a)
|
|
(4
|
)
|
|
—
|
|
|
(5
|
)
|
|
(1
|
)
|
|
Adjustment to tax expense to reflect pro forma tax rate (b)
|
|
3
|
|
|
(1
|
)
|
|
7
|
|
|
2
|
|
|
ADJUSTED EARNINGS
|
|
$
|
150
|
|
|
$
|
90
|
|
|
$
|
212
|
|
|
$
|
112
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION TO ADJUSTED DILUTED EARNINGS PER SHARE
ATTRIBUTABLE TO OWENS CORNING COMMON STOCKHOLDERS
|
|
|
|
|
|
|
|
|
|
DILUTED EARNINGS PER COMMON SHARE ATTRIBUTABLE TO OWENS CORNING
COMMON STOCKHOLDERS
|
|
$
|
1.19
|
|
|
$
|
0.77
|
|
|
$
|
1.67
|
|
|
$
|
0.92
|
|
|
Adjustment to remove adjusting items
|
|
0.11
|
|
|
—
|
|
|
0.13
|
|
|
0.02
|
|
|
Adjustment to remove tax benefit on adjusting items
|
|
(0.03
|
)
|
|
—
|
|
|
(0.04
|
)
|
|
(0.01
|
)
|
|
Adjustment to tax expense to reflect pro forma tax rate (b)
|
|
0.02
|
|
|
(0.01
|
)
|
|
0.06
|
|
|
0.02
|
|
|
ADJUSTED DILUTED EARNINGS PER SHARE ATTRIBUTABLE TO OWENS CORNING
COMMON STOCKHOLDERS
|
|
$
|
1.29
|
|
|
$
|
0.76
|
|
|
$
|
1.82
|
|
|
$
|
0.95
|
|
|
|
|
|
|
|
|
|
|
|
|
RECONCILIATION TO DILUTED SHARES OUTSTANDING
|
|
|
|
|
|
|
|
|
|
Weighted-average number of shares outstanding used for basic
earnings per share
|
|
115.1
|
|
|
117.5
|
|
|
115.3
|
|
|
117.6
|
|
|
Non-vested restricted and performance shares
|
|
0.8
|
|
|
0.4
|
|
|
0.8
|
|
|
0.3
|
|
|
Options to purchase common stock
|
|
0.5
|
|
|
0.4
|
|
|
0.4
|
|
|
0.4
|
|
|
Weighted-average number of shares outstanding and common equivalent
shares used for diluted earnings per share
|
|
116.4
|
|
|
118.3
|
|
|
116.5
|
|
|
118.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
The tax impact of adjusting items is based on the tax accounting
treatment and rate for the jurisdiction of each adjusting item.
|
|
(b)
|
|
To compute adjusted earnings, we apply a full year pro forma
effective tax rate to each quarter presented. For 2016, we have used
a full year pro forma effective tax rate of 33%, which is the
mid-point of our 2016 effective tax rate guidance of 32% to 34%. For
comparability, in 2015, we have used an effective tax rate of 33%,
which was our 2015 effective tax rate excluding the reversal
(recorded in the fourth quarter of 2015) of a valuation allowance
against certain Canadian net deferred tax assets.
|
|
|
|
|
|
Table 4
Owens Corning and Subsidiaries
Consolidated
Balance Sheets
(unaudited)
(in millions,
except per share data)
|
|
|
|
|
|
|
|
ASSETS
|
|
June 30,
2016
|
|
December 31,
2015
|
|
CURRENT ASSETS
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
67
|
|
|
$
|
96
|
|
|
Receivables, less allowances of $10 at June 30, 2016 and $8 at
December 31, 2015
|
|
879
|
|
|
709
|
|
|
Inventories
|
|
753
|
|
|
644
|
|
|
Assets held for sale
|
|
13
|
|
|
12
|
|
|
Other current assets
|
|
63
|
|
|
47
|
|
|
Total current assets
|
|
1,775
|
|
|
1,508
|
|
|
Property, plant and equipment, net
|
|
3,059
|
|
|
2,956
|
|
|
Goodwill
|
|
1,344
|
|
|
1,167
|
|
|
Intangible assets, net
|
|
1,152
|
|
|
999
|
|
|
Deferred income taxes
|
|
411
|
|
|
492
|
|
|
Other non-current assets
|
|
236
|
|
|
222
|
|
|
TOTAL ASSETS
|
|
$
|
7,977
|
|
|
$
|
7,344
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
CURRENT LIABILITIES
|
|
|
|
|
|
Accounts payable and accrued liabilities
|
|
$
|
979
|
|
|
$
|
912
|
|
|
Short-term debt
|
|
—
|
|
|
6
|
|
|
Long-term debt – current portion
|
|
177
|
|
|
163
|
|
|
Total current liabilities
|
|
1,156
|
|
|
1,081
|
|
|
Long-term debt, net of current portion
|
|
2,099
|
|
|
1,702
|
|
|
Pension plan liability
|
|
375
|
|
|
397
|
|
|
Other employee benefits liability
|
|
238
|
|
|
240
|
|
|
Deferred income taxes
|
|
32
|
|
|
8
|
|
|
Other liabilities
|
|
172
|
|
|
137
|
|
|
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
|
|
3,965
|
|
|
3,965
|
|
|
Accumulated earnings
|
|
1,208
|
|
|
1,055
|
|
|
Accumulated other comprehensive deficit
|
|
(635
|
)
|
|
(670
|
)
|
|
Cost of common stock in treasury (c)
|
|
(675
|
)
|
|
(612
|
)
|
|
Total Owens Corning stockholders’ equity
|
|
3,864
|
|
|
3,739
|
|
|
Noncontrolling interests
|
|
41
|
|
|
40
|
|
|
Total equity
|
|
3,905
|
|
|
3,779
|
|
|
TOTAL LIABILITIES AND EQUITY
|
|
$
|
7,977
|
|
|
$
|
7,344
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
10 shares authorized; none issued or outstanding at June 30, 2016,
and December 31, 2015.
|
|
(b)
|
|
400 shares authorized; 135.5 issued and 114.9 outstanding at June
30, 2016; 135.5 issued and 115.9 outstanding at December 31, 2015
|
|
(c)
|
|
20.4 shares at June 30, 2016, and 19.6 shares at December 31, 2015
|
|
|
|
|
|
Table 5
Owens Corning and Subsidiaries
Consolidated
Statements of Cash Flows
(unaudited)
(in
millions)
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
|
2016
|
|
2015
|
|
NET CASH FLOW PROVIDED BY OPERATING ACTIVITIES
|
|
|
|
|
|
Net earnings
|
|
$
|
198
|
|
|
$
|
111
|
|
|
Adjustments to reconcile net earnings to cash provided by (used for)
operating activities:
|
|
|
|
|
|
Depreciation and amortization
|
|
158
|
|
|
151
|
|
|
Gain on sale of fixed assets
|
|
—
|
|
|
(1
|
)
|
|
Deferred income taxes
|
|
83
|
|
|
37
|
|
|
Provision for pension and other employee benefits liabilities
|
|
3
|
|
|
7
|
|
|
Stock-based compensation expense
|
|
17
|
|
|
14
|
|
|
Other non-cash
|
|
(5
|
)
|
|
(11
|
)
|
|
Gain on extinguishment of debt
|
|
—
|
|
|
(5
|
)
|
|
Changes in operating assets and liabilities
|
|
(117
|
)
|
|
(175
|
)
|
|
Pension fund contribution
|
|
(9
|
)
|
|
(25
|
)
|
|
Payments for other employee benefits liabilities
|
|
(9
|
)
|
|
(10
|
)
|
|
Other
|
|
7
|
|
|
13
|
|
|
Net cash flow provided by operating activities
|
|
326
|
|
|
106
|
|
|
NET CASH FLOW USED FOR INVESTING ACTIVITIES
|
|
|
|
|
|
Cash paid for property, plant and equipment
|
|
(187
|
)
|
|
(177
|
)
|
|
Proceeds from the sale of assets or affiliates
|
|
—
|
|
|
2
|
|
|
Investment in subsidiaries and affiliates, net of cash acquired
|
|
(450
|
)
|
|
—
|
|
|
Purchases of alloy
|
|
—
|
|
|
(7
|
)
|
|
Proceeds from sale of alloy
|
|
—
|
|
|
7
|
|
|
Other
|
|
2
|
|
|
—
|
|
|
Net cash flow used for investing activities
|
|
(635
|
)
|
|
(175
|
)
|
|
NET CASH FLOW PROVIDED BY FINANCING ACTIVITIES
|
|
|
|
|
|
Proceeds from senior revolving credit and receivables securitization
facilities
|
|
434
|
|
|
819
|
|
|
Proceeds from term loan borrowing
|
|
300
|
|
|
—
|
|
|
Payments on senior revolving credit and receivables securitization
facilities
|
|
(326
|
)
|
|
(634
|
)
|
|
Payments on long-term debt
|
|
—
|
|
|
(8
|
)
|
|
Net decrease in short-term debt
|
|
(6
|
)
|
|
(19
|
)
|
|
Cash dividends paid
|
|
(40
|
)
|
|
(39
|
)
|
|
Purchases of treasury stock
|
|
(87
|
)
|
|
(47
|
)
|
|
Other
|
|
4
|
|
|
11
|
|
|
Net cash flow provided by financing activities
|
|
279
|
|
|
83
|
|
|
Effect of exchange rate changes on cash
|
|
1
|
|
|
(1
|
)
|
|
Net (decrease) increase in cash and cash equivalents
|
|
(29
|
)
|
|
13
|
|
|
Cash and cash equivalents at beginning of period
|
|
96
|
|
|
67
|
|
|
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
|
$
|
67
|
|
|
$
|
80
|
|
|
|
|
|
|
|
|
|
|
|
|
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
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Net sales
|
|
$
|
517
|
|
|
$
|
497
|
|
|
$
|
990
|
|
|
$
|
971
|
|
|
% change from prior year
|
|
4
|
%
|
|
-1
|
%
|
|
2
|
%
|
|
—
|
%
|
|
EBIT
|
|
$
|
74
|
|
|
$
|
67
|
|
|
$
|
138
|
|
|
$
|
127
|
|
|
EBIT as a % of net sales
|
|
14
|
%
|
|
13
|
%
|
|
14
|
%
|
|
13
|
%
|
|
Depreciation and amortization expense
|
|
$
|
33
|
|
|
$
|
31
|
|
|
$
|
67
|
|
|
$
|
63
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Insulation
|
|
The table below provides a summary of net sales, EBIT and
depreciation and amortization expense for the Insulation segment (in
millions):
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Net sales
|
|
$
|
414
|
|
|
$
|
451
|
|
|
$
|
799
|
|
|
$
|
830
|
|
|
% change from prior year
|
|
-8
|
%
|
|
1
|
%
|
|
-4
|
%
|
|
3
|
%
|
|
EBIT
|
|
$
|
32
|
|
|
$
|
25
|
|
|
$
|
45
|
|
|
$
|
32
|
|
|
EBIT as a % of net sales
|
|
8
|
%
|
|
6
|
%
|
|
6
|
%
|
|
4
|
%
|
|
Depreciation and amortization expense
|
|
$
|
27
|
|
|
$
|
26
|
|
|
$
|
52
|
|
|
$
|
50
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Roofing
|
|
The table below provides a summary of net sales, EBIT and
depreciation and amortization expense for the Roofing segment (in
millions):
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Net sales
|
|
$
|
679
|
|
|
$
|
503
|
|
|
$
|
1,108
|
|
|
$
|
896
|
|
|
% change from prior year
|
|
35
|
%
|
|
15
|
%
|
|
24
|
%
|
|
-4
|
%
|
|
EBIT
|
|
$
|
169
|
|
|
$
|
90
|
|
|
$
|
242
|
|
|
$
|
110
|
|
|
EBIT as a % of net sales
|
|
25
|
%
|
|
18
|
%
|
|
22
|
%
|
|
12
|
%
|
|
Depreciation and amortization expense
|
|
$
|
11
|
|
|
$
|
10
|
|
|
$
|
21
|
|
|
$
|
19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
Restructuring costs
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
|
$
|
(2
|
)
|
|
Acquisition-related costs for InterWrap and Ahlstrom transactions
|
|
(3
|
)
|
|
—
|
|
|
(5
|
)
|
|
—
|
|
|
Recognition of InterWrap inventory fair value step-up
|
|
(8
|
)
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
General corporate expense and other
|
|
(22
|
)
|
|
(26
|
)
|
|
(54
|
)
|
|
(53
|
)
|
|
EBIT
|
|
$
|
(35
|
)
|
|
$
|
(26
|
)
|
|
$
|
(69
|
)
|
|
$
|
(55
|
)
|
|
Depreciation and amortization
|
|
$
|
11
|
|
|
$
|
9
|
|
|
$
|
18
|
|
|
$
|
19
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 8
Owens Corning and Subsidiaries
Free
Cash Flow Reconciliation Schedules
(unaudited)
|
|
|
|
The reconciliation from net cash flow provided by operating
activities to free cash flow is shown in the table below (in
millions):
|
|
|
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
NET CASH FLOW PROVIDED BY OPERATING ACTIVITIES
|
|
$
|
263
|
|
|
$
|
222
|
|
|
$
|
326
|
|
|
$
|
106
|
|
|
Less: Cash paid for property, plant and equipment
|
|
(89
|
)
|
|
(88
|
)
|
|
(187
|
)
|
|
(177
|
)
|
|
Less: Purchases of alloy
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
FREE CASH FLOW
|
|
$
|
174
|
|
|
$
|
134
|
|
|
$
|
139
|
|
|
$
|
(78
|
)
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160727005277/en/
Source: Owens Corning