HARSCO CORPORATION REPORTS SECOND QUARTER 2014 RESULTS
August 7, 2014
· Adjusted Operating Income within Guidance; Organic Growth and Favorable Product Mix in Industrial and Rail Offset Bad Debt Costs in Metals & Minerals
· Project Orion Execution Progressing Rapidly with Phase I Benefits Expected to Reach High-end of Expectations
· Company Narrows 2014 Adjusted Operating Income Guidance to Range of $170 million to
Camp Hill, PA (August 7, 2014) . . . Harsco Corporation (NYSE:HSC) today reported second quarter 2014 results. Excluding special items, adjusted diluted earnings per share from continuing operations in the second quarter of 2014 were $0.17. This compares with $0.30 in the second quarter of 2013, which included results from the Company’s Infrastructure segment that was divested during the fourth quarter of 2013. Adjusted operating income excluding special items was $41 million, within the guidance range of $40 million to $45 million provided by the Company.
On a U.S. GAAP (“GAAP”) basis, second quarter 2014 diluted loss per share from continuing operations was $0.19, which includes Project Orion severance costs, additional costs for exited or underperforming sites, contract termination charges and Infrastructure transaction adjustments. This compares with GAAP diluted earnings per share of $0.30 in the second quarter of 2013. The Company’s second quarter earnings also included a loss of $3 million ($0.02 per share after tax) from the Brand Energy joint venture, which was impacted by foreign currency translation losses and restructuring costs in the period.
“The second quarter was another solid operating result for Harsco, as Industrial and Rail performed above expectations while Metals & Minerals and Corporate were impacted by a few items that had not been fully anticipated in our guidance,” said President and CEO Nick Grasberger. “This performance adds to the strong financial results we reported in the first quarter of the year.
“We are encouraged by a number of trends within our businesses. Backlogs in the Industrial segment are near record levels and our latest $100+ million award from the Swiss railway system further validates our global strategy in Rail. In Metals & Minerals, we are pleased with the progress on Project Orion and the organization’s response to the structural and process changes we are making. We now anticipate Project Orion Phase I benefits of approximately $25 million per annum versus the previous range of $20 million to $25 million. As part of Project Orion, we are also moving aggressively to address underperforming contracts. During the second quarter, we made several difficult decisions resulting in contract exit costs and asset impairments. While these decisions have a negative impact on short-term financial results, they are consistent with our focus on improving cash flow and returns on capital moving forward.”
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