67 WALL STREET, New York - July 22, 2013 - The Wall Street Transcript has just published its Agricultural & Specialty Chemicals Report offering a timely review of the sector to serious investors and industry executives. This special feature contains expert industry commentary through in-depth interviews with public company CEOs and Equity Analysts. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.
Topics covered: Crop Yield Management - U.S. Corn Crop - Chemicals Companies Pricing Power - Fertilizers, Paints and Coatings, and Petrochemicals - Emerging Market Demand - Specialty Chemicals and Fertilizer Pricing Power
Companies include: HB Fuller Co. (FUL) and many more.
In the following excerpt from the Agricultural & Specialty Chemicals Report, the President and CEO of H.B. Fuller Company (FUL) discusses company strategy and the outlook for this vital industry:
TWST: You reported your second-quarter earnings earlier this week. Can you give us some highlights form the quarter?
Mr. Owens: Yes. We've reaffirmed our guidance for the year, and importantly, reaffirmed our commitment to our strategic target to deliver 15% EBITDA margins in 2015. We're delivering our financial commitments, while at the same time integrating the largest acquisition in our history. H.B. Fuller acquired Forbo's industrial adhesives business last March, and we've made great strides in integrating the business and realizing the synergy benefits of the deal. We've completed the integration work in North America, and the Asia and European businesses are on track to meet the timetables we set.
For the second quarter, revenue was lower than we expected, but our gross margins were higher and operating expenses were less than expected, which enabled us to deliver a very strong quarter, with 14% improvement in operating profit and 8% EPS growth. EPS growth was a little less than expected because of some below-the-line effects of currency translation. Given the continued effects of sluggish economies around the world, we are satisfied with our results this past quarter.
TWST: In your latest earnings release, for the quarter ended June 1, you said you are on track to deliver the Forbo synergies. Can you elaborate on that? Where are you in the integration process, and what will be the impact of completing integration?
Mr. Owens: Yes. As I mentioned, we've made some significant changes to combine these two businesses - legacy H.B. Fuller and the former Forbo industrial adhesives business - that operated in the same market space. The Forbo business was running at about 6% to 7% EBITDA margins. We were running at 10% to 11%. The combination of those two businesses and the synergy that we're delivering is driving the company to a 15% EBITDA margin.
In North America, it was a...
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