St. Louis, MO, Jan. 9--Solutia expects fourth quarter earnings to be down approximately $.20 per share, including a net charge of approximately $.04 per share related to Solutia's interest in the Flexsys rubber chemicals joint venture. Operating results versus previous guidance were negatively impacted by weaker downstream markets, elevated raw material costs and reduced earnings from joint ventures. This estimate of fourth quarter results includes the operations of the resins, additives and adhesives businesses. These businesses will be reported in Solutia's Annual Report on Form 10-K for the period ended Dec. 31 as discontinued operations due to their pending sale to UCB S.A.
"We continue to operate in a very difficult environment characterized by weak global demand and high raw material and energy costs," said chairman and CEO John C. Hunter. "Despite these challenging business conditions, our focus on cash generation has allowed us to reduce overall debt by approximately $110 million over the prior year. We will continue to manage the company with a keen focus on cash generation and strengthening of the balance sheet, which will give us the flexibility to manage future business risk and uncertainty, while capitalizing on our commercial opportunities," Hunter noted.
The fourth quarter charge associated with the Flexsys joint venture relates to the write-down of assets to fair market value at its Nitro, West Virginia, facility. This charge of approximately $.04 per share represents Solutia's 50% interest in the results of operations of the joint venture.
