Omnova Solutions reduces debt by $10.5 million in second quarter

By Lisa Kerner

Charlotte, N.C., June 28 - Omnova Solutions Inc.'s net debt declined by $10.5 million during the second quarter to $324.6 million, with a year-to-date debt reduction of $31.9 million.

The company's debt includes $250 million of 7 7/8% senior notes due 2018, a $197 million term loan maturing in 2017 and $8.8 million of foreign operations borrowings.

Consolidated cash grew $9.3 million since the end of the first quarter of 2012 to $133.4 million, according to an Omnova news release.

As of May 31, there were no outstanding borrowings under the company's U.S. revolving asset-based credit facility, and the available borrowing capacity was $90.1 million.

Omnova's net leverage ratio improved to 2.74 times from 3.12 times on Nov. 30, 2011.

Early in the second quarter of 2012, Omnova divested its U.K.-based wallcovering business for about $6.2 million in cash and notes.

Compared to the prior-year period, Omnova's second-quarter net sales decreased by 1.7%, or $5.3 million, to $307.5 million, driven by a volume decline and unfavorable currency translation effects, partially offset by improved pricing to cover higher raw material costs.

Net income for the second quarter was $7.0 million, or $0.15 per diluted share, compared with $6.2 million, or $0.14 per diluted share, for the second quarter of 2011.

Omnova is a Fairlawn, Ohio-based provider of specialty chemicals, emulsion polymers and decorative surfaces.

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