Completes Acquisition of Saint-Gobain's Global Reinforcements and Composite
Fabrics Businesses
TOLEDO, Ohio, Nov. 1 /PRNewswire-FirstCall/ -- Owens Corning (NYSE: OC)
today reported consolidated net sales of $1.268 billion during the third
quarter, compared with $1.386 billion in the third quarter of 2006, an 8.5
percent decrease from the prior year. Third-quarter results reflected
continued weakness of the U.S. new residential construction market,
partially offset by stronger global markets in our composites business.
Third-quarter net earnings were $112 million, or $0.86 per diluted
share. Excluding comparability items (see attached Table 2 for a discussion
and reconciliation of such items), adjusted earnings from continuing
operations were $52 million, or $0.40 per diluted share. Such comparability
items in the third quarter included charges related to the company's
business acquisitions and dispositions, prior Chapter 11 proceedings, and
restructuring activities. Such items amounted to approximately $22 million
($14 million after tax) during the third quarter.
Consolidated Third-Quarter Results
* Earnings before interest and taxes (EBIT) from continuing operations in
the third quarter of 2007 were $83 million, compared with $145 million
during the same period of 2006. The decrease was primarily due to lower
sales and an increase in idle-facility costs, as the decline in the
North American new residential construction market impacted demand for
building materials, partially offset by lower marketing and
administrative costs. Excluding comparability items (see Table 2),
adjusted EBIT from continuing operations for the third quarter of 2007
was $105 million, compared with $140 million during the same period in
2006.
* For the first nine months, EBIT from continuing operations was $191
million, compared with $408 million for the same period of 2006.
Excluding comparability items, adjusted EBIT from continuing operations
for the first nine months of 2007 was $259 million, compared with $392
million during the same period in 2006.
* Gross margin as a percentage of consolidated net sales was 16.3 percent
during the third quarter, compared with 19.3 percent during the same
period of 2006. For the first nine months, gross margin as a percentage
of sales declined 2.0 percentage points compared to the first nine
months of 2006. The decrease was the result of sales volume and price
declines in the Insulating Systems and Roofing and Asphalt segments,
and increased material, energy, labor, and idle facility costs.
* Marketing and administrative expenses, as a percentage of consolidated
net sales, were 8 percent in the third quarter, compared with 9.4
percent during the same period in 2006. The decline was due primarily
to a decrease in performance-based compensation expense of
approximately $23 million compared with 2006, as adverse market
conditions negatively impacted Owens Corning's ability to achieve its
performance goals. Accordingly, the company made a year-to-date
adjustment to its accrual for performance-based compensation to reflect
the reduction in estimated expense for 2007. For the first nine months,
marketing and administrative expenses decreased 3 percent in 2007 as
compared with 2006.
Business Highlights
* During the third quarter of 2007, Owens Corning completed the sale of
its Siding Solutions business to Saint-Gobain for approximately $368
million of net proceeds as previously announced on July 17, 2007. The
sale included the company's Norandex/Reynolds distribution business
with 153 U.S. distribution centers in 38 states and three vinyl siding
manufacturing facilities.
* Owens Corning completed the sale of its Fabwel unit for approximately
$57 million in net proceeds.
* Owens Corning announced a share buy-back program in the first quarter
under which the company is authorized to repurchase up to 5 percent of
Owens Corning's outstanding common stock. The company did not
repurchase any shares during the first nine months of 2007.
* During the first nine months of 2007, depreciation and amortization
(D&A) totaled $239 million, which includes $24 million resulting from
the adoption of Fresh Start Accounting upon the company's emergence
from Chapter 11 in October 2006. Owens Corning currently estimates D&A
from continuing operations will total approximately $320 million in
2007.
* At the end of the third quarter of 2007, Owens Corning had $1.9 billion
of short- and long-term debt with cash-on-hand of $450 million.
Subsequent to the end of the third quarter, the company acquired Saint-
Gobain's Reinforcements and Composite Fabrics Businesses for $640
million (as described below), which impacted our cash and debt
position.
* Owens Corning's actual federal tax net operating loss resulting from
the distribution of cash and stock to settle its prior Chapter 11 case
is $3.1 billion, compared with the previous estimate of $2.8 billion.
The company's effective tax rate in 2007 is estimated at 30 percent.
* The company's continued focus on safety resulted in a 20 percent
reduction in injuries through the first nine months of 2007 as compared
with its Dec. 31, 2006 rate.
"Our composites business delivered a strong quarter," said Dave Brown,
president and chief executive officer. "The weakness in new residential
construction continued to have a significant impact on the overall
performance of our company. We've acted decisively to make our company more
global and lessen our exposure to the cyclical nature of the U.S. housing
market."
"The second half of 2007 will be remembered as one of strategic
accomplishment," said Mike Thaman, chairman and CEO-Elect. "Our acquisition
of Saint-Gobain's Reinforcements and Composite Fabrics businesses and the
divestiture of the siding and Fabwel businesses bring important balance to
our company's global revenue sources. We have seen progress in the
operating performance of our building materials businesses as the markets
have continued to weaken. We have taken actions that position our capacity
and cost structure for a weaker market in 2008."
"Yesterday's acquisition of Saint-Gobain's Reinforcements and Composite
Fabrics businesses accelerates our global growth in both developed and
emerging markets," said Thaman. "This extends our reach to commercial and
industrial glass fiber markets that are growing at twice the rate of global
GDP. It also allows our customers to benefit from an expanded product
range, world-class technology, and improved logistics and supply
capability, while enhancing shareholder value through the addition of a
business that is expected to generate EBITDA in excess of $100 million in
2007, not including the costs associated with the leasing of metals."
As announced on April 18, 2007, Mr. Brown will retire as president and
chief executive officer of Owens Corning by the end of 2007, and Mr. Thaman
has been selected to succeed Mr. Brown. Mr. Thaman was appointed chief
financial officer in 2000 and named to the Board of Directors in 2002,
becoming chairman later that year.
"I will retire as president, chief executive officer and as a member of
the Board of Directors on Dec. 6, 2007," said Mr. Brown. "I am confident
that Owens Corning has a bright future under Mike's leadership. He has 15
years of management experience at Owens Corning and has been my valued
partner during my tenure as CEO."
The Saint-Gobain Reinforcements and Composite Fabrics Acquisition
Completed
On Oct. 31, 2007, Owens Corning completed the acquisition of Saint-
Gobain's Reinforcements and Composite Fabrics businesses for $640 million,
accelerating the company's global growth strategy by enhancing its presence
in fast-growing emerging markets around the world.
Owens Corning projects that the acquired business will generate earning
before interest, taxes, depreciation and amortization (EBITDA) in excess of
$100 million for full year 2007, not including costs associated with the
leasing of metals. Under prior ownership, the business leased approximately
$320 million of certain metals used in its production tooling. In the near-
term, Owens Corning expects to continue the leasing of such metals.
Owens Corning continues to anticipate annual pre-tax synergies of more
than $100 million to be realized by the end of the fourth full year of
ownership, or 2011, with the majority of the synergies achieved during the
first three years. Synergies will come primarily from reduced operating
costs, improved energy efficiency in furnaces, sourcing and reduced
shipping costs.
Cost Reductions for 2008
As part of Owens Corning's annual operations planning, the company is
evaluating various cost-reduction projects to deliver significant savings
in operating and corporate costs. These projects include capacity and
headcount reductions, elimination of operational costs, and reduced general
corporate expenses. Some of these cost-reduction projects have begun. The
majority of the projects are expected to be completed by the end of the
fourth quarter 2007, resulting in a leaner cost structure that better
positions the company to compete in a weaker housing market in 2008. This
cost-reduction initiative is intended to reduce company-wide operating
costs by about $100 million.
Outlook
The weakness in new residential construction in the United States
continued through the first nine months of 2007. Based on current estimates
by the National Association of Home Builders (NAHB), the slowdown in U.S.
housing starts is expected to carry through 2008, which will continue to
impact the company's building materials businesses.
Worldwide demand for composite products is expected to continue to
increase during the remainder of 2007 and into 2008. The acquisition of
Saint- Gobain's Reinforcements and Composite Fabrics businesses enhances
Owens Corning's ability to serve customers on a global basis.
Owens Corning previously estimated that 2007 adjusted EBIT from
continuing operations should exceed $415 million, not including the impact
of the acquisition of Saint-Gobain's Reinforcements and Composite Fabrics
businesses, the sale of its Siding Solutions and Fabwel businesses or other
strategic organizational changes. Adjusted for these transactions, the $415
million adjusted EBIT from continuing operations guidance would be restated
as $365 million.
The company no longer believes that it will surpass its earlier
guidance of $365 million. Based on the deeper and prolonged weakness in
demand for building materials in the U.S., the company now believes $335
million is a more appropriate estimate for 2007 adjusted EBIT from
continuing operations.
"As we look to the year ahead, we will focus on four primary goals,"
said Mr. Thaman. "By integrating the acquisition, we will create a new
composites business; focus on growth opportunities with our customers to
ensure their success; promote the important role of our products in energy
efficiency and greenhouse gas reduction; and streamline our cost structure
and production capacity in response to weaker markets."
Third-Quarter Business Segment Highlights
Insulating Systems
* Net sales for the third quarter of 2007 were $462 million, a 12.7
percent decrease from $529 million during the same period in 2006. The
decrease was a result of the downturn in new residential construction
in the United States. During the third quarter, the company also began
to experience weakness in commercial and industrial markets.
* EBIT from continuing operations for the third quarter was $42 million,
compared with $125 million during the same period in 2006. Results were
unfavorably impacted by a decline in sales volume, lower selling
prices, and idle facility costs resulting from production curtailments.
In addition, results were negatively impacted by $11 million of
depreciation and amortization costs resulting from the adoption of
Fresh Start Accounting.
Composite Solutions
* Net sales for the third quarter of 2007 were $397 million, a 12.5
percent increase from $353 million during the same period in 2006. The
increase in sales was primarily attributable to moderate growth in non-
building related products, slightly higher pricing, and the favorable
impact of currency.
* EBIT from continuing operations for the third quarter of 2007 was $29
million, compared with $44 million during the same period in 2006. EBIT
from continuing operations for the third quarter of 2006 included a
gain of $10 million on the sale of metal used in certain production
tooling; a gain of $12 million on insurance recoveries related to a
July 2005 flood at the company's Taloja, India, production facility,
and $2 million in expenses related to the flood. Excluding these items,
EBIT from continuing operations improved by $5 million compared to the
same period in 2006. Results were negatively impacted by $1 million
resulting from the adoption of Fresh Start Accounting.
Roofing and Asphalt
* Net sales for the third quarter of 2007 were $379 million, a 17.2
percent decrease from $458 million during the same period in 2006. The
decline was due to the decrease in new residential construction and no
significant storm activity in the United States.
* EBIT from continuing operations for the third quarter of 2007 was $15
million, compared with $20 million during the same period in 2006.
Declines in volume and price negatively impacted earnings during the
quarter, partially offset by lower raw material costs. Results were
negatively impacted by $1 million resulting from the adoption of Fresh
Start Accounting.
Other Building Materials and Services
* Net sales for the third quarter of 2007 were $78 million, a 19.6
percent decrease from $97 million during the same period in 2006. The
decrease was due to an $18 million sales decline resulting from the
closure of the company's HOMExperts service line during the fourth
quarter of 2006. In our Masonry Products business (previously Cultured
Stone), sales increased due to the acquisition of the Modulo(TM)/ParMur
Group during the third quarter of 2006. This increase was offset by
volume declines in the remainder of the company's Masonry Products
business.
* EBIT from continuing operations for the third quarter of 2007 was $6
million, compared with break-even during the same period in 2006. The
increase was almost entirely due to the closure of the company's
HOMExperts service line during the fourth quarter of 2006. The adoption
of Fresh Start Accounting had no significant impact on this segment
during the third quarter of 2007.
Full-year 2007 results are currently scheduled to be announced on Feb.
27, 2008.
Conference Call
Thursday, Nov. 1, 2007
11 a.m. Eastern Daylight Time
All Callers
Live dial-in telephone number: 1-800-561-2813 or 1-617-614-3529
(Please dial in 10 minutes before conference call start time)
Passcode: 49788103
Live Webcast: http://www.owenscorning.com/investors
A telephone replay will be available through Nov. 8, 2007 at 1-888-286-
8010 or 1-617-801-6888. Passcode: 27250247. A replay of the webcast will
also be available at http://www.owenscorning.com/investors.
About Owens Corning
Owens Corning (NYSE: OC) is a world leader in building materials
systems and composite solutions. A Fortune 500 company for 53 consecutive
years, Owens Corning people redefine what is possible each day to deliver
high-quality products and services ranging from insulation, roofing and
masonry products, to glass composite materials used in transportation,
electronics, telecommunications and other high-performance applications.
Founded in 1938, Owens Corning is a market-leading innovator of glass fiber
technology with sales of $6.5 billion in 2006 and operations in 30
countries. Additional information is available at http://www.owenscorning.com.
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, many of which are
outside the control of the company, that could cause actual results to
differ materially from those projected in these statements and from the
company's historical results and experience. Further information on factors
that could affect the company's financial and other results is included in
the company's Forms 10-Q and 10-K, filed with the Securities and Exchange
Commission. Since it is not possible to predict or identify all of the
risks, uncertainties and other factors that may affect future results, the
factors detailed in the company's Forms 10-Q and 10-K should not be
considered a complete list. Any forward-looking statement speaks only as of
the date on which such statement is made, and the company undertakes no
obligation to update or revise any forward-looking statement, whether as a
result of new information, future events or otherwise.
Table 1
Owens Corning and Subsidiaries
Consolidated Statements of Earnings
(Unaudited)
(in millions, except per share amounts)
Prede- Prede-
Successor cessor Successor cessor
--------- -------- --------- -------
Three Months Ended Nine Months Ended
September 30, September 30,
--------- -------- --------- -------
2007 2006 2007 2006
NET SALES $1,268 $1,386 $3,674 $4,149
COST OF SALES 1,061 1,119 3,049 3,361
Gross margin 207 267 625 788
OPERATING EXPENSES
Marketing and administrative
expenses 102 130 365 377
Science and technology expenses 15 13 46 42
Restructuring costs (credits) (1) 10 (3) 10
Chapter 11 related
reorganization items 1 1 4 28
Asbestos litigation recoveries - (10) - (13)
Employee emergence equity
program 8 - 28 -
Gain on sale of fixed assets and
other (1) (22) (6) (64)
Total operating expenses 124 122 434 380
EARNINGS FROM CONTINUING OPERATIONS
BEFORE INTEREST AND TAXES 83 145 191 408
Interest expense, net 27 71 90 222
EARNINGS FROM CONTINUING OPERATIONS
BEFORE TAXES 56 74 101 186
Income tax expense (benefit) 16 20 30 (169)
EARNINGS FROM CONTINUING OPERATIONS
BEFORE MINORITY INTEREST AND EQUITY IN
NET EARNINGS OF AFFILIATES 40 54 71 355
Minority interest and equity in net
earnings (loss) of affiliates (2) (1) (4) 2
EARNINGS FROM CONTINUING OPERATIONS 38 53 67 357
Discontinued Operations:
Earnings from discontinued
operations, net of tax of $3,
$5, $5, and $15, respectively 8 9 9 19
Gain on sale of discontinued
operations, net of tax of $41 66 - 66 -
Total earnings from discontinued
operations 74 9 75 19
NET EARNINGS $112 $62 $142 $376
BASIC EARNINGS PER COMMON SHARE
Earnings from continuing
operations $0.29 $0.96 $0.52 $6.46
Earnings loss from discontinued
operations $0.58 $0.16 $0.59 $0.34
DILUTED EARNINGS PER COMMON SHARE
Earnings from continuing
operations $0.29 $0.88 $0.51 $5.96
Earnings loss from discontinued
operations $0.57 $0.16 $0.58 $0.32
WEIGHTED AVERAGE COMMON SHARES
Basic 128.1 55.3 128.1 55.3
Diluted 130.8 59.9 130.8 59.9
Table 2
Owens Corning and Subsidiaries
Reconciliation Schedules
(Unaudited)
(in millions, except per share amounts)
When reviewing the operating performance of the company with its Board of
Directors and employees, management makes adjustments to net earnings
from continuing operations, earnings before interest and taxes ("EBIT")
from continuing operations and diluted earnings per share from continuing
operations. To calculate "adjusted earnings from continuing operations",
"adjusted EBIT from continuing operations" and "adjusted diluted earnings
per share from continuing operations", management excludes certain items
from net earnings from continuing operations and earnings from continuing
operations before interest and taxes, including those related to the
company's prior Chapter 11 proceedings and restructuring and other
activities so as to improve comparability over time (the "comparability
items"). As described more fully in the following financial schedules,
such comparability items amounted a charge of $22 million in the third
quarter of 2007 compared with a credit of $5 million during the same
period of 2006. For the nine months ended September 30 2007, such items
amounted a charge of $68 million, compared with a credit of $16 million
during the same period of 2006.
Prede- Prede-
Successor cessor Successor cessor
--------- -------- --------- -------
Three Months Ended Nine Months Ended
September 30, September 30,
--------- -------- --------- -------
2007 2006 2007 2006
RECONCILIATION TO ADJUSTED EARNINGS
FROM CONTINUING OPERATIONS
NET EARNINGS $112 $62 $142 $376
Discontinued operations
Earnings from discontinued
operations, net of tax of $3,
$5, $6, and $15, respectively 8 9 9 19
Gain on sale of discontinued
operations, net of tax of $41 66 - 66 -
Total earnings from discontinued
operations 74 9 75 19
EARNINGS FROM CONTINUING OPERATIONS 38 53 67 357
Adjustments to remove comparability
items:
Chapter 11 related reorganization
items $1 $1 $4 $28
Asbestos litigation recoveries -
Owens Corning - (10) - (13)
Restructuring costs (credits) and
other (1) - (3) (35)
OCV Reinforcements transaction
costs 3 4 21 4
Loss related to the exit of our
HOMExperts service line - - 7 -
Asset impairments 11 - 11 -
Employee emergence equity program 8 - 28 -
Total adjustments to remove
comparability items: 22 (5) 68 (16)
Tax effect of adjustments at 34% in
2007 and 37% in 2006 (8) 2 (23) 6
ADJUSTED EARNINGS FROM CONTINUING
OPERATIONS $52 $50 $112 $347
RECONCILIATION TO ADJUSTED DILUTED
EARNINGS PER SHARE FROM CONTINUING
OPERATIONS:
DILUTED EARNINGS PER SHARE FROM
CONTINUING OPERATIONS $0.29 $0.88 $0.51 $5.96
Total adjustments to remove
comparability items 0.17 (0.09) 0.52 (0.27)
Tax effect of adjustments at 34% in
2007 and 37% in 2006 (0.06) 0.04 (0.17) 0.10
ADJUSTED DILUTED EARNINGS PER SHARE
FROM CONTINUING OPERATIONS $0.40 $0.83 $0.86 $5.79
DILUTED EARNINGS PER SHARE FROM
DISCONTINUED OPERATIONS $0.57 $0.16 $0.58 $0.32
Diluted shares 130.8 59.9 130.8 59.9
RECONCILIATION TO ADJUSTED EARNINGS
FROM CONTINUING OPERATIONS BEFORE
INTEREST AND TAXES:
NET EARNINGS $112 $62 $142 $376
Discontinued operations
Earnings from discontinued
operations, net of tax of $3,
$5, $6, and $15, respectively $8 $9 $9 $19
Gain on sale of discontinued
operations, net of tax of $41 66 - 66 -
Total earnings from discontinued
operations 74 9 75 19
EARNINGS FROM CONTINUING OPERATIONS 38 53 67 357
Minority interest and equity in net
(loss) earnings of affiliates (2) (1) (4) 2
EARNINGS FROM CONTINUING OPERATIONS
BEFORE MINORITY INTEREST AND
EQUITY IN NET EARNINGS OF
AFFILIATES 40 54 71 355
Income tax expense (benefit) 16 20 30 (169)
EARNINGS FROM CONTINUING OPERATIONS
BEFORE TAXES 56 74 101 186
Interest expense, net 27 71 90 222
EARNINGS FROM CONTINUING OPERATIONS
BEFORE INTEREST AND TAXES 83 145 191 408
Total adjustments to remove
comparability items 22 (5) 68 (16)
ADJUSTED EARNINGS FROM CONTINUING
OPERATIONS BEFORE INTEREST AND TAXES $105 $140 $259 $392
Table 3
Owens Corning and Subsidiaries
Condensed Consolidated Balance Sheets
(Unaudited)
(in millions)
Successor
September 30, December 31,
2007 2006
ASSETS
Current Assets
Cash and cash equivalents $450 $1,089
Receivables, less allowances of
$9 million in 2007 and $26
million in 2006 624 573
Inventories 662 749
Restricted Cash - disputed
distribution reserve 54 85
Assets held for sale - current 55 -
Other current assets 65 56
Total current assets 1,910 2,552
Property, plant, and equipment, net 2,225 2,521
Goodwill 1,173 1,313
Intangible assets 1,194 1,298
Deferred income taxes 554 549
Assets held for sale - noncurrent 234 -
Other noncurrent assets 218 237
TOTAL ASSETS $7,508 $8,470
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable and accrued liabilities $862 $1,081
Accrued interest 39 39
Short term debt and current
portion of long-term debt 29 1,440
Liabilities held for sale - current 39 -
Total current 969 2,560
Long-term debt 1,827 1,296
Pension plan liability 212 312
Other employee benefits liability 329 325
Liabilities held for sale - non-current 1 -
Minority interest 38 44
Other liabilities 207 247
Stockholders' equity 3,925 3,686
TOTAL LIABILITIES AND STOCKHOLDERS'
EQUITY $7,508 $8,470
Table 4
Owens Corning and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(in millions)
Successor Predecessor
Nine Months Ended
September 30,
2007 2006
NET CASH FLOW (USED FOR) PROVIDED BY
OPERATING ACTIVITIES
Net earnings $142 $376
Adjustments to reconcile net
earnings cash provided by (used
for) operating activities:
Depreciation and amortization 239 184
Provision for impairments 22 2
Gain on sale of businesses
and fixed assets (110) (49)
Change in deferred income taxes 43 (164)
Provision for pension and
other employee benefits liabilities 31 74
Employee emergence equity program 28 -
Decrease in restricted cash
- disputed distribution reserve 31 -
Provision for post-petition
interest/fees on pre-
petition obligations - 228
Provision for asbestos
litigation claims - 21
Payments related to Chapter 11 filings (26) -
Increase in receivables (161) (99)
Increase in inventories (31) (118)
Increase in prepaid assets (1) (41)
Decrease in accounts payable and
accrued liabilities (113) (68)
Pension fund contribution (117) (14)
Payments for other employee
benefits (20) (20)
Proceeds from insurance for
asbestos litigation claims,
excluding Fibreboard - 18
Increase in restricted cash -
asbestos and insurance related - (17)
Increase in restricted cash,
securities, and other - Fibreboard - (67)
Other 4 (2)
Net cash flow (used
for) provided by
operating activities (39) 244
NET CASH FLOW PROVIDED BY (USED FOR)
INVESTING ACTIVITIES
Additions to plant and equipment (167) (270)
Investment in affiliates and
subsidiaries, net of cash acquired (31) (47)
Proceeds from the sale of
assets or affiliate 437 65
Net cash flow used for
investing activities 239 (252)
NET CASH FLOW USED FOR FINANCING ACTIVITIES
Payments on long-term debt (78) (7)
Proceeds from long-term debt 617 17
Payments on revolving credit facility (383) -
Proceeds from revolving credit facility 383 -
Payment of Note Payable to
524(g) Trust (1,390) -
Payments of equity commitment
agreement - (100)
Net (decrease) increase in
short-term debt 3 (1)
Net cash flow used for
financing activities (848) (91)
Effect of exchange rate changes on cash 9 5
NET DECREASE IN CASH AND CASH EQUIVALENTS (639) (94)
Cash and cash equivalents at
beginning of period 1,089 1,559
CASH AND CASH EQUIVALENTS AT END OF PERIOD $450 $1,465
Table 5
Owens Corning and Subsidiaries
Business Segment Information
(Unaudited)
(in millions)
Prede- Prede-
Successor cessor Successor cessor
Three Three Nine Nine
Months Months Months Months
Ended Ended Ended Ended
Sept. 30 Sept. 30 Sept. 30 Sept. 30
2007 2006 2007 2006
NET SALES
Insulating Systems $462 $529 $1,322 $1,570
Roofing and Asphalt 379 458 1,099 1,420
Other Building Materials and
Services 78 97 234 285
Composite Solutions 397 353 1,152 1,028
Total reportable segments 1,316 1,437 3,807 4,303
Corporate Eliminations (48) (51) (133) (154)
Consolidated $1,268 $1,386 $3,674 $4,149
EARNINGS FROM CONTINUING OPERATIONS
BEFORE INTEREST AND TAXES
Insulating Systems $42 $125 $137 $359
Roofing and Asphalt 15 20 36 97
Other Building Materials and
Services 6 - 18 2
Composite Solutions 29 44 80 104
Total reportable segments $92 $189 $271 $562
RECONCILIATION TO CONSOLIDATED
EARNINGS FROM CONTINUING OPERATIONS
BEFORE INTEREST AND TAXES
Chapter 11 related
reorganization items $(1) $(1) $(4) $(28)
Asbestos litigation recoveries
- Owens Corning - 10 - 13
Restructuring credits 1 (10) 3 (10)
OCV Reinforcements transaction
costs (3) (4) (21) (4)
Losses related to the exit of
our HOMExperts service line - - (7) -
Asset impairments (11) - (11) -
Employee emergence equity
program (8) - (28) -
General corporate income
(expense) 13 (39) (12) (125)
CONSOLIDATED EARNINGS FROM CONTINUING
OPERATIONS BEFORE INTEREST AND TAXES $83 $145 $191 $408
NOTE: The Successor financial information includes the impact of
additional depreciation and amortization, offset by lower pension cost
related to the adoption of fresh start accounting. See the Form 10-Q for
the quarter ended September 30, 2007 for further discussion of these
items.
SOURCE Owens Corning
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