Amid sales slump, Milacron exits blow molding business
The plastics processing equipment maker's Uniloy blow molding business has now been listed as a "discontinued operation".
Plastics processing equipment maker Milacron Holdings Corp. met business expectations in first quarter 2019, but experienced a slump in business across the board, with new orders and sales down by double digits and management considering exiting the blow molding sector.
Also announced in its Q1 2019 sales report is the news that Milacron is exiting its Uniloy blow molding machinery business. Uniloy’s blow molding machines includes reciprocating screw blow molders, injection blow molding presses, shuttle machines and accumulator head blow molding machines.
During the first quarter of 2019, Milacron evaluated its blow molding business and concluded that it qualifies as a discontinued operation in accordance with U.S. GAAP. This is a result of the company considering whether it would retain the blow molding business or exit it, Milacron said.
The operating results and cash flows related to the Uniloy blow molding business have been reflected as discontinued operations in the company’s condensed consolidated statements of operations and condensed consolidated statements of cash flows for all periods presented, said Milacron, while the assets and liabilities that may be sold have been reflected as assets and liabilities held for sale for the current and prior periods in the company’s condensed consolidated balance sheets.
Turning to the rest of its business, the Cincinnati, Ohio-based company said that new machinery orders fell by 10.8% to US$275.3 million from US$308.5 million for the same period a year ago, and sales dropped 13.9% to US$248.7 million from US$288.8 million for the same period a year ago.
Q1 2019 sales for Milacron’s Advanced Plastic Processing Technologies (APPT) were US$119.4 million compared to sales of US$140.3 million in the same period a year ago. “Excluding $3.8 million of unfavorable effects of currency movements, sales decreased 12.2% over the prior year period,” Milacron said in a statement. “Sales were also down in the Melt Delivery & Control Systems (MDCS), falling to US$100.0 million compared to US$116.5 million in the same period a year ago. Excluding US$4.6 million of unfavorable effects of currency movements, sales decreased 10.2% over the prior year period.”
Milacron’s Fluid Technologies business unit, meanwhile, saw Q1 sales of US$29.3 million compared to US$32.0 million in the same period a year ago. “Excluding $1.5 million of unfavorable effects of currency movements, sales decreased 3.8% over the prior year period,” Milacron said.
“Milacron’s first quarter results were consistent with our expectations, and the first half of 2019 is progressing as anticipated,” said Milacron CEO Tom Goeke. “Orders for the first quarter increased 7% [sequentially] when compared to the third quarter and fourth quarter of 2018, and our India equipment business continued to perform well with double-digit, constant-currency sales growth over prior year.”