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OM Group's CEO Discusses Q3 2011 Results - Earnings Call Transcript

Stocks in this article: OMG

At this time, I will turn the call over to Joe Scaminace.

Joe Scaminace

Thank you, Troy, and good morning, everyone. I’m going to forego some of the formalities of our past prepared remarks and jumpstart our discussion today by highlighting some of our accomplishments from the past quarter.

Revenue in the third quarter of 2011 grew 40% compared with last year. Our performance generated a 66% improvement in our income. Likewise, operating profit increased 38%, also benefiting from volume growth and positive pricing. And once again, we generated positive cash flow from operations. Cash flow was positive even after funding one of the largest acquisitions in the history of our company. We’re certainly well positioned to continue the execution of our growth strategy with a very strong balance sheet. It’s also very encouraging that our acquisition of VAC is contributing right from the start.

What makes our performance particularly satisfying to me is the manner in which we achieve these results. Clearly, we are continuing to deliver on our commitment to diversify this company’s portfolio through an unrelenting focus on executing our long-term business strategy. In fact, we are a different company today, with a portfolio of technologies that serve diverse and growing markets all over the world.

For example, nearly one-third of our sales in our Engineered Materials segment meet specific requirements for the energy sector. This includes high quality materials for next-generation rechargeable batteries, critical components for solar and wind power generation, energy storage solutions for managing the variability in alternative energy sources and a range of products that help combustion engines improve their efficiency through advance fuel systems, high efficiency motors and state-of-the-art sensors.

Now to be sure, commodity prices still a factor in our Advanced Materials business. However, that portion of our portfolio is a much smaller piece of the overall company today. And it will continue to shrink in relative size as we build upon our other core growth platforms. I look forward to updating you on our progress as we continue to diversify our portfolio.

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