Georgia Gulf's Q4 sales down on lower prices, volumes

Georgia Gulf Corporation, a leading North American manufacturer of chlorovinlys and aromatics, reported net sales of US$535.6 mln for the Q4 - 2008 compared to net sales of US$776.4 mln the same period last year. The decrease in sales is primarily due to lower prices and volumes driven by extremely difficult North American housing and construction market conditions, partially offset by higher Electrochemical Unit (ECU) values. The company has posted a net loss of US$198.7 mln ($5.76 per diluted share) for the fourth quarter of 2008, compared to a net loss of US$227.3 mln ($6.62 per diluted share) during the same quarter in the previous year. "Georgia Gulf's fourth quarter operational performance was impacted by the dramatic slowdown in sales during the final months of the year as well as inventory holding losses in Aromatics driven by benzene and propylene price declines," said Paul Carrico, Georgia Gulf's President and CEO. "Despite one of the most challenging environments our industry has experienced in decades, we generated strong cash flows from operating activities of $56 million during the fourth quarter and increased our liquidity position to $233 million," Mr. Carrico added. The company's Chlorovinyls segment posted decline in Q4 sales to US$271.5 mln from US$356.4 mln during the fourth quarter of 2007 driven by lower volumes. The segment posted an operating loss of US$4.5 mln compared to an operating loss of US$31.9 mln during the same quarter in the prior year. In the Window & Door Profiles and Mouldings segment, sales plummeted to US$80.8 mln for the quarter compared to US$126.1 mln during the same quarter in the prior year, highlighting extremely difficult conditions in the North American housing and construction markets. Also, its Outdoor Building Products segment witnessed a reduction of sales to US$80.6 mln for the quarter compared to US$118.8 mln during the same quarter in the prior year. For full year 2008, the company's declined to US$2.9 bln, compared to US$3.2 bln during 2007 due to lower volumes in all segments partially offset by higher ECU values. In 2008, Georgia Gulf recorded a net loss of US$257.6 mln ($7.48 per diluted share) compared to a net loss of US$266.0 mln ($7.75 per diluted share) in the prior year. The major actions taken by the company included permanent closure of the two PVC resin plants representing about 25% of total capacity, consolidating production and closing 4 other manufacturing facilities and reduction in workforce by 15%.