Cabot Corp Reports Fourth Quarter Diluted EPS of $0.83 and Adjusted EPS of $1.00

Fiscal Year 2016 Diluted EPS of $2.36 and Adjusted EPS of $3.14

BOSTON–(BUSINESS WIRE)–Cabot
Corporation
(NYSE: CBT) today announced results for its fourth
quarter and full fiscal year 2016.

Key Highlights

  • Delivered strong fourth quarter results driven by higher margins
    and lower fixed costs
  • Achieved third consecutive year of record EBIT for the Performance
    Chemicals segment
  • Generated strong cash flows from operations of $386 million for
    fiscal 2016
  • Returned $104 million of cash to shareholders in fiscal year 2016
             
(In millions, except per share amounts)     Fiscal 2016     Fiscal 2015
Fourth     Full     Fourth     Full

Quarter

Year

Quarter

Year

 
Net sales $ 619 $ 2,411 $ 671 $ 2,871
Net income (loss) attributable to Cabot Corporation $ 52 $ 149 $ 40 $ (334)
 
Net earnings (loss) per share attributable to Cabot Corporation $ 0.83 $ 2.36 $ 0.63 $ (5.27)
Less: Discontinued operations

Less: Certain items per share

$
$

0.02
(0.19)

$
$

0.02
(0.80)

$
$

0.01
0.12

$
$

0.02
(8.00)

Adjusted EPS     $ 1.00     $ 3.14     $ 0.74     $ 2.71
 

Commenting on the results, Cabot President and CEO Sean Keohane, said,
“I am pleased to report another strong quarter which was driven
primarily by strong margins and cost management. The Performance
Chemicals and Reinforcement Materials segments each delivered positive
results compared to the same quarter in the prior year. In addition, we
experienced significant volume growth in Purification Solutions
attributable to the full implementation of the MATS regulations. Our
strong finish to fiscal year 2016 resulted in 16% adjusted EPS growth
year over year including the Performance Chemicals segment delivering a
third consecutive year of record EBIT. In addition, we maintained strong
discipline around our capital allocation framework, returning over $100
million to shareholders in the form of dividends and share repurchases
during the fiscal year.”

Financial Detail
For the fourth
quarter of fiscal 2016, net income attributable to Cabot Corporation was
$52 million ($0.83 per diluted common share). Net income includes a per
share charge of $0.19 from certain items, principally reflecting charges
associated with legal and environmental matters and reserves. Adjusted
EPS for the fourth quarter of fiscal 2016 was $1.00 per share.

Segment Results
Reinforcement
Materials —
Fourth quarter fiscal 2016 EBIT in Reinforcement
Materials increased by $11 million compared to the fourth quarter of
fiscal 2015 principally driven by favorable pricing and product mix.
Volumes declined by 3% during the fourth quarter of fiscal 2016 as
compared to the fourth quarter of fiscal 2015 as a result of lower
volumes in EMEA and Asia, primarily due to the closure of the Merak
site. Sequentially, Reinforcement Materials EBIT increased by $7 million
compared to the third quarter of fiscal 2016 driven by improved pricing
and a favorable inventory impact, partially offset by a decline in
volumes. Sequentially, volumes decreased by 5% due to weaker demand in
the Americas and seasonally lower volumes in EMEA.

Global and regional volume changes for the rubber blacks product line
for the fourth quarter of fiscal 2016 as compared to the same quarter of
the prior year and the third quarter of fiscal 2016 are included in the
table below:

             
   

Fourth Quarter
Year over Year Change

   

Fourth Quarter
Sequential Change

 
Global     (3%)     (5%)
Asia (4%) (2%)
Europe, Middle East, Africa (6%) (13%)
Americas     1%     (6%)
 

Performance Chemicals — Fourth quarter fiscal 2016 EBIT in
Performance Chemicals increased by $9 million compared to the fourth
quarter of fiscal 2015 due to improved margins from a stronger product
mix and lower raw material costs. Volumes increased by 3% in the
specialty carbons and formulations business and 6% in the metal oxides
business. Sequentially, Performance Chemicals EBIT decreased by $1
million compared to the third quarter of fiscal 2016, primarily due to
seasonally lower volumes, with a 7% decrease in specialty carbons and
formulations and a 3% decrease in metal oxides. The lower volumes were
partially offset by lower fixed costs.

Purification Solutions — Fourth quarter fiscal 2016 EBIT in
Purification Solutions was $2 million, in line with results in the
fourth quarter of fiscal 2015. The segment results benefitted from
higher volumes associated with MATS related demand and lower fixed
costs, which were offset by an unfavorable impact from reducing
inventory levels as compared to the prior year. Sequentially,
Purification Solutions EBIT increased by $2 million compared to the
third quarter of fiscal 2016 due to higher volumes from MATS related
demand and a lower inventory reduction, partially offset by a less
favorable product mix.

Specialty Fluids – Fourth quarter fiscal 2016 EBIT in Specialty
Fluids increased by $7 million compared to the fourth quarter of fiscal
2015 due to increased project activity in the North Sea and Asia.
Sequentially, Specialty Fluids EBIT decreased by $5 million compared to
the third quarter of fiscal 2016 primarily due to reduced rental
activity in the North Sea.

Cash Performance The Company ended fiscal year 2016
with a cash balance of $200 million. During the fourth quarter of fiscal
2016, cash flows from operating activities were $91 million, including
an increase in net working capital of $4 million. Capital expenditures
for the fourth quarter of fiscal 2016 were $32 million, including $29
million for sustaining and compliance capital expenditures. Additional
uses of cash during the fourth quarter included $18 million for
dividends and $15 million for share repurchases.

Taxes — During the fourth quarter of fiscal 2016, the Company
recorded a tax provision of $13 million for an effective tax rate of
19%. This included a tax benefit from certain items of $7 million. The
operating tax rate for the fiscal year ended September 30, 2016 was 24%.

Outlook
Commenting on the
outlook for the Company, Keohane said, “Looking forward to 2017, we
remain focused on our strategy of investing for growth in the core,
driving application innovation with our customers, and generating strong
cash flows through efficiency and optimization. Although the current
business environment remains mixed, we expect to see moderate growth in
2017 across all segments. However, the first quarter is expected to be
weaker sequentially due to typical seasonality and higher maintenance
costs from anticipated plant turnarounds. Overall, we are focused on
delivering shareholder value by growing annual adjusted EPS by 7-10%
over time and returning approximately 50% of our discretionary free cash
flow to shareholders.”

Earnings Call
The Company will
host a conference call with industry analysts at 2:00 p.m. Eastern time
on Tuesday, November 1, 2016. The call can be accessed through Cabot’s
investor relations website at http://investor.cabot-corp.com

About Cabot Corporation
Cabot
Corporation (NYSE: CBT) is a global specialty chemicals and performance
materials company, headquartered in Boston, Massachusetts. The Company
is a leading provider of rubber
and specialty
carbons
, activated
carbon
, inkjet
colorants
, cesium
formate drilling fluids
, fumed
silica
, and aerogel.
Cabot routinely posts information that may be important to investors in
the “Investors” section of its website at www.cabotcorp.com.
The Company encourages investors and potential investors to consult the
Cabot website regularly.

Forward-Looking Statements — This earnings release contains
forward-looking statements. All statements that address expectations or
projections about the future, including our expectations for adjusted
earnings per share growth, growth across all segments during 2017,
performance in the first quarter of fiscal 2017 including from expected
seasonality in our business, actions that will drive earnings growth,
demand for our products, and expectations for our use of discretionary
free cash flow are forward-looking statements. These statements are not
guarantees of future performance and are subject to risks,
uncertainties, potentially inaccurate assumptions, and other factors,
some of which are beyond our control and difficult to predict. If known
or unknown risks materialize, or should underlying assumptions prove
inaccurate, our actual results could differ materially from past results
and from those expressed or implied by forward-looking statements.
Important factors that could cause our results to differ materially from
those expressed or implied in the forward-looking statements include,
but are not limited to economic, competitive, legal, governmental, and
technological factors. These factors are discussed more fully in the
reports we file with the Securities and Exchange Commission,
particularly under the heading “Risk Factors” in our annual report on
Form 10-K for our fiscal year ended September 30, 2015, filed with the
SEC at www.sec.gov.
We assume no obligation to provide revisions to any forward-looking
statements should circumstances change, except as otherwise required by
securities and other applicable laws.

Use of Non-GAAP Financial Measures
To supplement Cabot’s
consolidated financial statements presented on a generally accepted
accounting principles (“GAAP”) basis, the preceding discussion of our
results and the accompanying financial tables report Adjusted EPS and
our operating tax rate, both of which are non-GAAP financial measures.
These non-GAAP financial measures are not computed in accordance with,
or an alternative to, GAAP. A reconciliation of Adjusted EPS to diluted
income (loss) per share (EPS) from continuing operations, the most
directly comparable GAAP financial measure, and a reconciliation of
operating tax rate to effective tax rate, the most directly comparable
GAAP financial measure, are provided in the table titled “Certain Items
and Reconciliation of Adjusted EPS and Operating Tax Rate.”

Management believes these non-GAAP measures provide investors with
greater transparency to the information used by Cabot management in its
financial and operational decision-making, allow investors to see
Cabot’s results through the eyes of management, and better enable
Cabot’s investors to understand Cabot’s operating performance and
financial condition.

Adjusted EPS. In calculating Adjusted EPS, we exclude from our
net income (loss) per share from continuing operations items of expense
and income that management does not consider representative of the
Company’s business operations. Accordingly, reporting earnings on an
adjusted basis supplements the GAAP measure of performance and provides
additional information related to the underlying performance of the
business. For example, certain of the items we exclude are items that we
are required by GAAP to recognize in one period that relate to
activities extending over several periods or relate to single events
that management considers to be unusual and infrequent, although not
necessarily non-recurring. We refer to these items as “certain items.”
Management believes excluding these items facilitates operating
performance comparisons from period to period by eliminating differences
caused by the existence and timing of certain expense and income items
that would not otherwise be apparent on a GAAP basis and evaluates the
Company’s operating performance without the impact of these costs or
benefits. Management also uses adjusted EPS as a key measure in
evaluating management performance for incentive compensation purposes.

The calculations of Adjusted EPS for the periods presented in this
release exclude the impact of the following items, among others, that
are included in our GAAP diluted net income (loss) per share:

  • Global restructuring activities include costs or benefits associated
    with cost reduction initiatives or plant closures and are primarily
    related to (i) employee termination costs, (ii) asset impairment
    charges associated with restructuring actions, (iii) costs to close
    facilities, including environmental costs and contract termination
    penalties, and (iv) gains realized on the sale of land or equipment
    associated with restructured plants or locations.
  • Foreign currency loss on devaluation represents the impact of
    controlled currency devaluations on the Company’s net monetary assets
    denominated in that currency. Most recently this has applied to
    currency exchange rate changes in Argentina and Venezuela.
  • Legal and environmental reserves and matters consist of costs or
    benefits for matters typically related to former businesses or that
    are otherwise incurred outside of the ordinary course of business.
  • Executive transition costs include incremental charges, including
    stock compensation charges, associated with the retirement or
    termination of employment of senior executives of the Company.
  • Asset impairment charges primarily include charges associated with an
    impairment of goodwill or other long-lived assets.
  • Acquisition and integration-related charges include transaction costs,
    redundant costs incurred during the period of integration, and costs
    associated with transitioning certain management and business
    processes to Cabot’s processes.
  • Employee benefit plan settlement charges consist of the costs
    associated with transferring the obligations and assets held by one of
    the Company’s defined benefit plans to a multi-employer plan.

Cabot does not provide a target GAAP EPS growth rate range or
reconciliation of the adjusted EPS growth rate range with a GAAP EPS
growth rate range because, without unreasonable effort, we are unable to
predict with reasonable certainty the matters we would allocate to
“certain items,” including unusual gains and losses, costs associated
with future restructurings, acquisition-related expenses and litigation
outcomes. These items are uncertain, depend on various factors, and
could have a material impact on GAAP EPS in future periods.

Operating Tax Rate. Our “operating tax rate” represents the tax
rate on our recurring operating results. This rate excludes discrete tax
items, which are unusual or infrequent items that are excluded from the
estimated annual effective tax rate and other tax items, including the
impact of the timing of losses in certain jurisdictions, cumulative tax
rate adjustments and the impact of the items of expense and income we
identify as certain items on both our operating income and the tax
provision. Management believes that the operating tax rate is useful
supplemental information because it helps our investors compare our tax
rate year to year on a consistent basis and to understand what our tax
rate on current operations would be without the impact of these items.

Explanation of Terms Used

Product Mix. The term “product mix” refers to the mix of types
and grade of products sold or the mix of geographic regions where
products are sold, and the positive or negative impact this has on the
revenue or profitability of the business or segment.

Net Working Capital. The term “net working capital” includes
accounts receivable, inventory and accounts payable and accrued expenses.

                             
                   
CABOT CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS
                             
                             
Periods ended September 30 Three Months

Twelve Months

Dollars in millions, except per share amounts (unaudited)     2016     2015     2016     2015
 
Net sales and other operating revenues $ 619 $ 671 $ 2,411 $ 2,871
 
Cost of sales   450     532     1,833     2,286  
 
Gross profit 169 139 578 585
 
 
Selling and administrative expenses 78 66 275 282
 
Research and technical expenses 13 14 53 58
 
Purification Solutions long-lived assets impairment charge 1 210
 
Purification Solutions goodwill impairment charge (1 ) 352
       
Income (loss) from operations 78 59 250 (317 )
 
 
Other (expense) income
 
Interest and dividend income 1 1 5 4
 
Interest expense (14 ) (13 ) (54 ) (53 )
 
Other income (expense) 1 (5 ) (7 ) (11 )
 
       
Total other expense   (12 )   (17 )   (56 )   (60 )
 
Income (loss) from continuing operations before income taxes and
equity in
earnings of affiliated companies 66 42 194 (377 )
 
(Provision) benefit for income taxes (A) (13 ) (2 ) (34 ) 45
 
Equity in earnings of affiliated companies, net of tax 1 3 4
 
       
Income (loss) from continuing operations 54 40 163 (328 )
 
Income from discontinued operations, net of tax (B) 1 1 1 2
       
Net income (loss) 55 41 164 (326 )
 
Net income attributable to noncontrolling interests 3 1 15 8
       
Net income (loss) attributable to Cabot Corporation $ 52   $ 40   $ 149   $ (334 )
 
 
 
Diluted earnings per share of common stock
attributable to Cabot Corporation
 
Continuing operations $ 0.81 $ 0.62 $ 2.34 $ (5.29 )
 
Discontinued operations (B) 0.02 0.01 0.02 0.02
       
Net income (loss) attributable to Cabot Corporation $ 0.83 $ 0.63 $ 2.36 $ (5.27 )
 
Weighted average common shares outstanding
Diluted (C) 62.9 63.1 62.9 63.4
 
(A)Included within the provision for income taxes is a
tax benefit for the twelve months ended September 30, 2015 in the
amount of $80 million associated with the long-lived asset
impairment charge that was recorded in the third quarter of fiscal
2015.
 
(B)Amounts relate primarily to the previously divested
Supermetals and Security Materials businesses.
 

(C)The weighted average common shares outstanding for
the twelve months ended September 30, 2015 excludes approximately
1 million shares as those shares would be antidilutive due to the
Company’s net loss position in that period.

                           
                 
CABOT CORPORATION SUMMARY RESULTS BY SEGMENTS
                           
                           
Periods ended September 30 Three Months Twelve Months
Dollars in millions, except per share amounts (unaudited)     2016     2015     2016     2015
 
Sales
 
Reinforcement Materials $ 289 $ 338 $ 1,108 $ 1,507
 
Performance Chemicals 214 227 865 927
Specialty Carbons and Formulations 141 152 578 630
Metal Oxides 73 75 287 297
 
Purification Solutions 80 77 290 296
 
Specialty Fluids   15     6     47     42  
 
Segment sales 598 648 2,310 2,772
 
Unallocated and other (A)   21     23     101     99  
 
Net sales and other operating revenues $ 619   $ 671   $ 2,411   $ 2,871  
 
Segment Earnings Before Interest and Taxes (B)
 
Reinforcement Materials $ 42 $ 31 $ 137 $ 143
 
Performance Chemicals 58 49 225 178
 
Purification Solutions 2 2 (5 ) 5
 
Specialty Fluids   5     (2 )   13     6  
 
Total Segment Earnings Before Interest and Taxes 107 80 370 332
 
Unallocated and Other
 
Interest expense (14 ) (13 ) (54 ) (53 )
Certain items (C) (18 ) (18 ) (81 ) (617 )
Unallocated corporate costs (9 ) (11 ) (45 ) (46 )
General unallocated income (D) 1 4 7 11
Less: Equity in earnings of affiliated companies   (1 )       (3 )   (4 )
 
Income (loss) from continuing operations before income taxes and
equity in
earnings of affiliated companies
66 42 194 (377 )
 
(Provision) benefit for income taxes (including tax certain items) (13 ) (2 ) (34 ) 45
 
Equity in earnings of affiliated companies 1 3 4
       
Income (loss) from continuing operations 54 40 163 (328 )
 
Income from discontinued operations, net of tax (E) 1 1 1 2
       

Net income (loss)

55 41 164 (326 )
 
Net income attributable to noncontrolling interests 3 1 15 8
       
Net income (loss) attributable to Cabot Corporation $ 52   $ 40   $ 149   $ (334 )
 
Diluted earnings per share of common stock attributable to
Cabot Corporation
 
 
Continuing operations $ 0.81 $ 0.63 $ 2.34 $ (5.29 )
 
Discontinued operations (E) 0.02 0.01 0.02 0.02
       
Net income (loss) attributable to Cabot Corporation $ 0.83 $ 0.64 $ 2.36 $ (5.27 )
 
Adjusted earnings per share
Adjusted EPS (F) $ 1.00 $ 0.74 $ 3.14 $ 2.71
 
Weighted average common shares outstanding
 
Diluted (G) 62.9 63.1 62.9 63.4
 
(A)Unallocated and other reflects royalties, other
operating revenues, external shipping and handling fees, the impact
of the corporate adjustment for unearned revenue, the removal of
100% of the sales of an equity method affiliate, and discounting
charges for certain Notes receivable.
 
(B)Segment EBIT is a measure used by Cabot’s Chief
Operating Decision-Maker to measure consolidated operating results,
assess segment performance and allocate resources. Segment EBIT
includes equity in earnings of affiliated companies, royalty income,
and allocated corporate costs.
 
(C)Details of certain items are presented in the Certain
Items and Reconciliation of Adjusted EPS and Operating Tax Rate
table.
 
(D)General unallocated income includes foreign currency
transaction gains (losses), interest income, dividend income, the
profit related to the corporate adjustment for unearned revenue, and
the impact of LIFO accounting.
 
(E)Amounts relate primarily to the previously divested
Supermetals and Security Materials business.
 
(F)Adjusted EPS is a non-GAAP measure, and a
reconciliation of Adjusted EPS to GAAP EPS is presented in the
Certain Items and Reconciliation of Adjusted EPS and Operating Tax
Rate table.
 

(G)The weighted average common shares outstanding for
the twelve months ended September 30, 2015 excludes approximately
1 million shares as those shares would be antidilutive due to the
Company’s net loss position in that period.

               
         
CABOT CORPORATION CONSOLIDATED STATEMENT OF FINANCIAL POSITION
               
               
September 30, September 30,
2016 2015
Dollars in millions     (unaudited)     (audited)
 
Current assets:
 
Cash and cash equivalents $ 200 $ 77
Accounts and notes receivable, net of reserve for doubtful accounts
of $8 and $7
456 477
Inventories:
Raw materials 66 69
Work in process 7 1
Finished goods 237 287
Other   38   40
Total inventories 348 397
Prepaid expenses and other current assets 50 54
Deferred income taxes   62   43
Total current assets   1,116   1,048
 
Property, plant and equipment, net 1,290 1,383
 
Goodwill 152 154
Equity affiliates 53 57
Intangible assets, net 140 153
Assets held for rent 91 86
Deferred income taxes 273 152
Other assets 43 42
   
Total assets $ 3,158 $ 3,075
               
         
CABOT CORPORATION CONSOLIDATED STATEMENT OF FINANCIAL POSITION
               
               
September 30, September 30,
2016 2015
Dollars in millions, except share and per share amounts     (unaudited)     (audited)
 
Current liabilities:
 
Notes payable $ 7 $ 22
Accounts payable and accrued liabilities 364 389
Income taxes payable 27 28
Deferred income taxes 22 1
Current portion of long-term debt   1     1  
Total current liabilities   421     441  
 
Long-term debt 918 970
Deferred income taxes 139 59
Other liabilities 282 240
Redeemable preferred stock 26 27
 
Stockholders’ equity:
Preferred stock:
Authorized: 2,000,000 shares of $1 par value
Issued and Outstanding: None and none
Common stock:
Authorized: 200,000,000 shares of $1 par value
Issued: 62,449,425 and 62,704,966 shares

Outstanding: 62,210,711 and 62,458,396 shares

62 63

Less cost of 238,714 and 246,570 shares of common treasury stock

(7 ) (8 )
Additional paid-in capital
Retained earnings 1,544 1,478
Accumulated other comprehensive income   (325 )   (299 )
Total Cabot Corporation stockholders’ equity 1,274 1,234
Noncontrolling interests   98     104  
Total stockholders’ equity   1,372     1,338  
Total liabilities and stockholders’ equity $ 3,158   $ 3,075  
                                       
CABOT CORPORATION
                                                             
  Fiscal 2015 Fiscal 2016
Dollars in millions,
except per share amounts (unaudited)     Dec. Q.     Mar. Q.     June Q.     Sept. Q.     FY Dec. Q.     Mar. Q.     June Q.     Sept. Q.     FY
 
Sales
Reinforcement Materials $ 460 $ 358 $ 351 $ 338 $ 1,507 $ 288 $ 261 $ 270 $ 289 $ 1,108
Performance Chemicals 229 237 234 227 927 207 216 228 214 865
Specialty Carbons and Formulations 157 162 159 152 630 140 145 152 141 578
Metal Oxides 72 75 75 75 297 67 71 76 73 287
Purification Solutions 76 71 72 77 296 66 67 77 80 290
Specialty Fluids       16         8         12         6         42     7         6         19         15         47  
Segment Sales 781 674 669 648 2,772 568 550 594 598 2,310
Unallocated and other (A)       31         20         25         23         99     35         18         27         21         101  
 
Net sales and other operating revenues     $ 812       $ 694       $ 694       $ 671       $ 2,871   $ 603       $ 568       $ 621       $ 619       $ 2,411  
 
Segment Earnings Before Interest and Taxes (B)
Reinforcement Materials $ 53 $ 27 $ 32 $ 31 $ 143 $ 26 $ 34 $ 35 42 $ 137
Performance Chemicals 39 42 48 49 178 50 58 59 58 225
Purification Solutions (1 ) 1 3 2 5 (5 ) (2 ) 2 (5 )
Specialty Fluids       6         (1 )       3         (2 )       6             (2 )       10         5         13  
Total Segment Earnings Before Interest and Taxes 97 69 86 80 332 71 88 104 107 370
 
 
Unallocated and Other
Interest expense (13 ) (14 ) (13 ) (13 ) (53 ) (13 ) (14 ) (13 ) (14 ) (54 )
Certain items (C) (26 ) (6 ) (567 ) (18 ) (617 ) (58 ) 1 (6 ) (18 ) (81 )
Unallocated corporate costs (12 ) (11 ) (12 ) (11 ) (46 ) (13 ) (12 ) (11 ) (9 ) (45 )
General unallocated income (expense) (D) 6 3 (2 ) 4 11 5 1 1 7
Less: Equity in earnings of affiliated companies       (1 )       (2 )       (1 )               (4 )           (1 )       (1 )       (1 )       (3 )
 
Income (loss) from continuing operations before income taxes and
equity in earnings (loss) of affiliated companies 51 39 (509 ) 42 (377 ) (8 ) 62 74 66 194
 
(Provision) benefit for income taxes (including tax certain items) (3 ) (14 ) 64 (2 ) 45 5 (11 ) (15 ) (13 ) (34 )
Equity in earnings of affiliated companies       1         2         1                 4             1         1         1         3  
 
Income (loss) from continuing operations 49 27 (444 ) 40 (328 ) (3 ) 52 60 54 163
Income from discontinued operations, net of tax (E)                       1         1         2                             1         1  
 
Net income (loss) 49 27 (443 ) 41 (326 ) (3 ) 52 60 55 164
 
Net income attributable to noncontrolling interests       4         1         2         1         8     4         4         4         3         15  
 
Net income (loss) attributable to Cabot Corporation $ 45 $ 26 $ (445 ) $ 40 $ (334 ) $ (7 ) $ 48 $ 56 $ 52 $ 149
 
Diluted earnings per share of common stock
attributable to Cabot Corporation
 
Continuing operations $ 0.69 $ 0.41 $ (7.05 ) $ 0.62 $ (5.29 ) $ (0.11 ) $ 0.76 $ 0.88 $ 0.81 $ 2.34
Discontinued operations (E)                       0.01         0.01         0.02                             0.02         0.02  
Net income (loss) attributable to Cabot Corporation (F) $ 0.69 $ 0.41 $ (7.04 ) $ 0.63 $ (5.27 ) $ (0.11 ) $ 0.76 $ 0.88 $ 0.83 $ 2.36
 
Adjusted earnings per share
Adjusted EPS (G)     $ 0.80       $ 0.53       $ 0.64       $ 0.74       $ 2.71   $ 0.51       $ 0.70       $ 0.93       $ 1.00       $ 3.14  
 
Weighted average common shares outstanding
Diluted (F)   64.6         64.1         63.3         63.1         63.4     62.5         62.8         62.9         62.9         62.9  
 
(A) Unallocated and other reflects royalties, other
operating revenues, external shipping and handling fees, the impact
of the corporate adjustment for unearned revenue, the removal of
100% of the sales of an equity method affiliate and discounting
charges for certain Notes receivable.
 
(B)Segment EBIT is a measure used by Cabot’s Chief
Operating Decision-Maker to measure consolidated operating results,
assess segment performance and allocate resources. Segment EBIT
includes equity in earnings of affiliated companies, royalty income,
and allocated corporate costs.
 
(C)Details of certain items are presented in the Certain
Items and Reconciliation of Adjusted EPS and Operating Tax Rate
table.
 
(D)General unallocated income (expense) includes foreign
currency transaction gains (losses), interest income, dividend
income, the profit related to the corporate adjustment for unearned
revenue, and the impact of LIFO accounting.
 
(E)Amounts relate primarily to the previously divested
Supermetals and Security Materials businesses.
 

(F)The weighted average common shares outstanding used
to calculate earnings per share for the three months ended June
30, 2015, the twelve months ended September 30, 2015, and the
three months ended December 31, 2015 exclude approximately 0.5
million, 1 million, and 1 million shares, respectively, as those
shares would be antidilutive due to the Company’s net loss
position in those periods.

 
(G)Adjusted EPS is a non-GAAP measure, and a
reconciliation of Adjusted EPS to GAAP EPS is presented in the
Certain Items and Reconciliation of Adjusted EPS and Operating Tax
Rate table.

Contacts

Cabot Corporation
Investor Contact:
Steve Delahunt,
617-342-6255

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