Solutia reports 40% increase in net sales

08 May '08

3 min read

Solutia Inc reported net sales of $985 million for the first quarter of 2008, a 40% increase over net sales of $702 million for the same period in 2007.

Approximately 29% of this increase is attributable to the consolidation of Flexsys sales beginning on May 1, 2007, following Solutia's acquisition of the remaining 50% share of its former joint venture. On a pro-forma basis, adjusting 2007 first quarter sales to include Flexsys, sales increased 14% over the prior year.

Solutia had consolidated net income of $1,420 million for the first quarter 2008 compared to a loss of $8 million for the same period in 2007. Solutia's results were impacted by reorganization items and certain gains and losses of $1,416 million after-tax and ($23) million after-tax in 2008 and 2007 respectively.

After consideration of these special items in both periods, income was down $11 million from $15 million in the first quarter of 2007 to $4 million in the first quarter of 2008. This decline was the result of a higher percentage of the company's pre-tax earnings from foreign jurisdictions subject to income tax, higher interest costs and increased depreciation and amortization expense.

"Despite softness in U.S. automotive and housing markets, our first quarter results reflect strong volume gains across most businesses which demonstrates the improved geographic and end use diversity of the company's portfolio," commented Jeffry Quinn, chairman, president and chief executive officer of Solutia Inc.

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