U.S. markets close in 5 hours 48 minutes
  • S&P 500

    3,832.17
    +10.62 (+0.28%)
     
  • Dow 30

    31,107.20
    +160.21 (+0.52%)
     
  • Nasdaq

    11,211.62
    +30.08 (+0.27%)
     
  • Russell 2000

    1,722.84
    -16.00 (-0.92%)
     
  • Crude Oil

    113.80
    +2.04 (+1.83%)
     
  • Gold

    1,817.90
    -3.30 (-0.18%)
     
  • Silver

    20.75
    -0.12 (-0.58%)
     
  • EUR/USD

    1.0492
    -0.0033 (-0.31%)
     
  • 10-Yr Bond

    3.1380
    -0.0680 (-2.12%)
     
  • GBP/USD

    1.2119
    -0.0065 (-0.54%)
     
  • USD/JPY

    136.7470
    +0.6190 (+0.45%)
     
  • BTC-USD

    20,116.08
    -872.22 (-4.16%)
     
  • CMC Crypto 200

    434.35
    -5.32 (-1.21%)
     
  • FTSE 100

    7,337.01
    +13.60 (+0.19%)
     
  • Nikkei 225

    26,804.60
    -244.87 (-0.91%)
     

Avient Announces Record Third Quarter 2021 Results

  • Oops!
    Something went wrong.
    Please try again later.
·12 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

- Sales increased 32% to $1.2 billion and GAAP EPS from continuing operations increased to $0.57 from $0.02 in the prior year quarter

- Adjusted EPS increased 52% to $0.70 driven by record third quarter operating income in all segments

- Increased dividend 12% to $0.95, on an annualized basis, representing the eleventh consecutive annual increase

- Expected to continue pursuing sustainable solutions acquisitions and resume opportunistic share repurchases with net debt to adjusted EBITDA leverage projected at 2.1x by year end

CLEVELAND, Oct. 28, 2021 /PRNewswire/ -- Avient Corporation (NYSE: AVNT), a leading provider of specialized and sustainable material solutions, today reported its third quarter results for 2021. Third quarter 2021 GAAP EPS from continuing operations was $0.57 compared to $0.02 in the prior year third quarter. The company noted that GAAP EPS includes special items (Attachment 3), which impacted EPS in both periods.

Nathan Peters (PRNewsfoto/Avient Corporation)
Nathan Peters (PRNewsfoto/Avient Corporation)

"It has been over a year since we completed the acquisition of Clariant's color business and became Avient – bold moves to help us become the specialty formulator we are today," said Robert M. Patterson, Chairman, President and Chief Executive Officer, Avient Corporation. "We have achieved significant growth in sustainable solutions, healthcare and composites in 2021. Add on nearly $50 million in synergies from the Clariant color business integration, and we are having a record year."

The company noted customer demand for its products continues to be robust across all end markets and regions, as revenue increased 32% to $1.2 billion in the third quarter and adjusted EPS increased 52% to $0.70. The company maintains its previously communicated full-year adjusted EPS guidance of $3.00, which is an increase of 55% over the prior year adjusted EPS of $1.93.

"This has been one of the most challenging years we have experienced as a result of navigating the COVID pandemic and an unprecedented combination of inflation, supply chain disruptions, and labor shortages," Mr. Patterson said. "I'm very proud of our performance and our associates who continue to take care of each other and our customers."

"When we initially announced the acquisition of Clariant's color business in December 2019, we aggressively planned to reduce net debt to adjusted EBITDA leverage and now project to be at 2.1x by year end, which is ahead of schedule by nearly a year," said Mr. Patterson. "As such, we look forward to pursuing other acquisition opportunities and/or repurchasing Avient shares in the open market in the future."

Upcoming Investor Day

"Planning is underway for our investor day in New York City on December 9. We are excited to lay out our long-term growth plans highlighting our sustainable solutions portfolio as well as provide an update on the synergies expected from the Clariant color business acquisition," said Jamie Beggs, Senior Vice President and Chief Financial Officer, Avient Corporation. "We will be sending out registration information shortly and will offer both in-person and virtual options in light of the continuing impacts of the pandemic."

The company noted it will provide more details on its third quarter results and outlook during the webcast scheduled for 8:00 a.m. Eastern Time on October 28, 2021.

Webcast Details

The webcast can be viewed live at avient.com/investors, or by clicking here: https://edge.media-server.com/mmc/p/yrq7mgm9.To participate in the audio-only portion of the call, dial 1-844-835-7433 (domestic) or 1-914-495-8589 (international) and provide conference ID number 7899765. There will be a question and answer session following the company's presentation and prepared remarks.

A recording of the webcast and the slide presentation will be available at avient.com/investors. In addition, a recording of the audio will be available for one week, beginning at 11:00 a.m. ET on Thursday, October 28, 2021. To access, dial 1-855-859-2056 (domestic) or 1-404-537-3406 (international) and provide conference ID number 7899765.

Full Year Comparisons Pro Forma for Acquisition of Clariant's Color Business

The company acquired Clariant's color ("Clariant Color") business on July 1, 2020 (the "Acquisition Date"). Comparisons to prior year full year financial results herein are presented on a pro forma basis such that the prior periods include the business results of Clariant Color for that prior period. Management believes this provides better comparability of the performance of the combined businesses. Refer to Attachment 7 Reconciliation of Non-GAAP Financial Measures for details regarding adjustments to previously reported results to arrive to the pro forma financial metrics.

About Avient

Avient Corporation (NYSE: AVNT), with expected 2021 revenues of $4.75 billion, provides specialized and sustainable material solutions that transform customer challenges into opportunities, bringing new products to life for a better world. Examples include:

  • Unique technologies that improve the recyclability of products and enable recycled content to be incorporated, thus advancing a more circular economy

  • Light-weighting solutions that replace heavier traditional materials like metal, glass and wood, which can improve fuel efficiency in all modes of transportation and reduce carbon footprint

  • Sustainable infrastructure solutions that increase energy efficiency, renewable energy, natural resource conservation and fiber optic / 5G network accessibility

Avient employs approximately 8,400 associates and is certified ACC Responsible Care®, a founding member of the Alliance to End Plastic Waste and certified Great Place to Work®. For more information, visit www.avient.com.

Forward-looking Statements

In this press release, statements that are not reported financial results or other historical information are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements give current expectations or forecasts of future events and are not guarantees of future performance. They are based on management's expectations that involve a number of business risks and uncertainties, any of which could cause actual results to differ materially from those expressed in or implied by the forward-looking statements. They use words such as "will," "anticipate," "estimate," "expect," "project," "intend," "plan," "believe," and other words and terms of similar meaning in connection with any discussion of future operating or financial condition, performance and/or sales. Factors that could cause actual results to differ materially from those implied by these forward-looking statements include disruptions, uncertainty or volatility in the credit markets that could adversely impact the availability of credit already arranged and the availability and cost of credit in the future; the effect on foreign operations of currency fluctuations, tariffs and other political, economic and regulatory risks; the current and potential future impact of the COVID-19 pandemic on our business, results of operations, financial position or cash flows including without any limitation, any supply chain and logistics issues; our ability to achieve the strategic and other objectives relating to the acquisition of Clariant's Color business, including any expected synergies; changes in polymer consumption growth rates and laws and regulations regarding plastics in jurisdictions where we conduct business; fluctuations in raw material prices, quality and supply, and in energy prices and supply; production outages or material costs associated with scheduled or unscheduled maintenance programs; unanticipated developments that could occur with respect to contingencies such as litigation and environmental matters; an inability to achieve the anticipated financial benefit from initiatives related to acquisition and integration working capital reductions, cost reductions and employee productivity goals; our ability to pay regular quarterly cash dividends and the amounts and timing of any future dividends; information systems failures and cyberattacks; our ability to consummate and successfully integrate acquisitions; and amounts for cash and non-cash charges related to restructuring plans that may differ from original estimates, including because of timing changes associated with the underlying actions. The above list of factors is not exhaustive.

We undertake no obligation to publicly update forward-looking statements, whether as a result of new information, future events or otherwise. You are advised to consult any further disclosures we make on related subjects in our reports on Form 10-Q, 8-K and 10-K that we provide to the Securities and Exchange Commission.

Non-GAAP Financial Measures

The Company uses both GAAP (generally accepted accounting principles) and non-GAAP financial measures. The non-GAAP financial measures include: adjusted EPS, adjusted operating income, free cash flow and adjusted EBITDA. Avient's chief operating decision maker uses these financial measures to monitor and evaluate the ongoing performance of the Company and each business segment and to allocate resources.

The Company does not provide reconciliations of forward-looking non-GAAP financial measures, such as outlook for adjusted earnings per share, to the most comparable GAAP financial measures on a forward-looking basis because the Company is unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing and amount of certain items, such as, but not limited to, restructuring costs, environmental remediation costs, acquisition related costs, and other non-routine costs. Each of such adjustments has not yet occurred, are out of the Company's control and/or cannot be reasonably predicted. For the same reasons, the Company is unable to address the probable significance of the unavailable information.

Attachment 1

Avient Corporation

Summary of Condensed Consolidated Statements of Income (Unaudited)

(In millions, except per share data)



Three Months Ended September 30,


Nine Months Ended September 30,


2021


2020


2021


2020









Sales

$

1,219.8



$

924.5



$

3,617.3



$

2,245.1


Operating Income

78.7



33.5



307.2



124.3


Net income from continuing operations attributable to Avient shareholders

52.9



1.7



201.0



57.8


Basic earnings per share from continuing operations attributable to Avient shareholders

$

0.58



$

0.02



$

2.20



$

0.64


Diluted earnings per share from continuing operations attributable to Avient shareholders

$

0.57



$

0.02



$

2.18



$

0.64


Senior management uses comparisons of adjusted net income from continuing operations attributable to Avient shareholders and diluted adjusted earnings per share (EPS) from continuing operations attributable to Avient shareholders, excluding special items, to assess performance and facilitate comparability of results. Senior management believes these measures are useful to investors because they allow for comparison to Avient's performance in prior periods without the effect of items that, by their nature, tend to obscure Avient's operating results due to the potential variability across periods based on timing, frequency and magnitude. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation from, or solely as alternatives to, financial measures prepared in accordance with GAAP. Below is a reconciliation of these non-GAAP financial measures to their most directly comparable financial measures calculated and presented in accordance with GAAP. See Attachment 3 for a definition and summary of special items.


Three Months Ended September 30, 2021


Three Months Ended September 30, 2020

Reconciliation to Condensed Consolidated Statements of Income

$


EPS


$


EPS









Net income from continuing operations attributable to Avient shareholders

$

52.9



$

0.57



$

1.7



$

0.02


Special items, after tax (Attachment 3)

11.7



0.13



40.3



0.44


Adjusted net income / EPS - excluding special items

$

64.6



$

0.70



$

42.0



$

0.46



Nine Months Ended September 30, 2021


Nine Months Ended September 30, 2020

Reconciliation to Condensed Consolidated Statements of Income

$


EPS


$


EPS









Net income from continuing operations attributable to Avient shareholders

$

201.0



$

2.18



$

57.8



$

0.64


Special items, after tax (Attachment 3)

26.0



0.28



51.5



0.57


Adjusted net income / EPS - excluding special items

$

227.0



$

2.46



$

109.3



$

1.21


Attachment 2

Avient Corporation

Condensed Consolidated Statements of Income (Unaudited)

(In millions, except per share data)



Three Months Ended

September 30,


Nine Months Ended

September 30,


2021


2020


2021


2020









Sales

$

1,219.8



$

924.5



$

3,617.3



$

2,245.1


Cost of sales

964.4



714.3



2,770.8



1,713.7


Gross margin

255.4



210.2



846.5



531.4


Selling and administrative expense

176.7



176.7



539.3



407.1


Operating income

78.7



33.5



307.2



124.3


Interest expense, net

(19.0)



(29.7)



(57.8)



(55.3)


Other income, net

1.4



1.5



4.1



12.6


Income from continuing operations before income taxes

61.1



5.3



253.5



81.6


Income taxes

(8.5)



(2.7)



(51.8)



(22.5)


Net income from continuing operations

52.6



2.6



201.7



59.1


Loss from discontinued operations, net of income taxes







(0.5)


Net income

52.6



2.6



201.7



58.6


Net loss (income) attributable to noncontrolling interests

0.3



(0.9)



(0.7)



(1.3)


Net income attributable to Avient common shareholders

$

52.9



$

1.7



$

201.0



$

57.3










Earnings per share attributable to Avient common shareholders - Basic:





Continuing operations

$

0.58



$

0.02



$

2.20



$

0.64


Discontinued operations








Total

$

0.58



$

0.02



$

2.20



$

0.64










Earnings per share attributable to Avient common shareholders - Diluted:





Continuing operations

$

0.57



$

0.02



$

2.18



$

0.64


Discontinued operations







(0.01)


Total

$

0.57



$

0.02



$

2.18



$

0.63










Cash dividends declared per share of common stock

$

0.2125



$

0.2025



$

0.6375



$

0.6075










Weighted-average shares used to compute earnings per common share:








Basic

91.4



91.5



91.3



89.7


Diluted

92.2



91.9



92.1



90.7


Attachment 3

Avient Corporation

Summary of Special Items (Unaudited)

(In millions, except per share data)


Special items (1)

Three Months Ended September 30,


Nine Months Ended September 30,


2021


2020


2021


2020

Cost of sales:








Restructuring costs, including accelerated depreciation and amortization

$

(5.3)



$

(1.3)



$

(8.6)



$

(2.5)


Environmental remediation costs

(9.4)



(15.8)



(22.4)



(19.3)


Reimbursement of previously incurred environmental costs





4.5



8.7


Acquisition related costs

(2.6)



(10.5)



(1.2)



(10.5)


Impact on cost of sales

(17.3)



(27.6)



(27.7)



(23.6)










Selling and administrative expense:








Restructuring, legal and other



(4.2)



(1.7)



(9.5)


Acquisition earn-out adjustments



(1.5)





(2.5)


Acquisition related costs

(2.7)



(7.1)



(7.2)



(23.5)


Impact on selling and administrative expense

(2.7)



(12.8)



(8.9)



(35.5)










Impact on operating income

(20.0)



(40.4)



(36.6)



(59.1)










Costs related to committed financing in interest expense, net



(9.6)





(10.1)


Other income, net

0.1



...