Ferro Increases Prices for Porcelain Enamel Products
Ferro Corporation’s (NYSE:FOE) Porcelain Enamel business has announced porcelain enamel product price increases for North America (including Mexico). Increases are between 6 and 12 percent, and up to 20 percent for some specialty products. Pricing changes are in effect as of September 1, 2008.
The cost of key raw materials and energy used in the production of porcelain enamel products have increased significantly, with titanium dioxide prices still escalating rapidly. Ferro said surcharges will also remain in effect for nickel and cobalt as long as these metal prices remain volatile. Cost pressures are not expected to decrease in the near future due to the current economic conditions.
“Even with our product reformulations and substitutions and supply chain management efforts, we are unable to offset raw material, transportation and energy costs enough to avoid implementing porcelain enamel price increases this year,” said Lee Gauthier, North American Business Director, Inorganic Specialties. “However, we continue to work hard at finding ways to provide our customers with the most cost-effective solutions, in spite of the tough economy.”
Ferro is the world’s leading supplier of porcelain enamel, a glass that is bonded to metal (generally carbon steel, stainless steel, cast iron or aluminum) at temperatures from 1000 degreesF – 1600 degreesF. Porcelain enamel has long been used as an ultimate quality, highly durable and sanitary finish on large and small appliances, cookware and grills, sanitary ware, water heaters, building panels, signage, and chemical storage vessels. Ferro serves porcelain enamel customers worldwide from locations in North America, South America, Europe, Asia, and Australia.
Ferro Corporation (http://www.ferro.com/) is a leading global supplier of technology-based performance materials for manufacturers. Ferro materials enhance the performance of products in a variety of end markets, including electronics, telecommunications, building and renovation, appliances, automotive, household furnishings, industrial products, and pharmaceuticals. Headquartered in Cleveland, Ohio, the Company has approximately 6,300 employees globally and reported sales of $2.2 billion in 2007.
Cautionary Note on Forward-Looking Statements
Certain statements in this Ferro press release may constitute “forward-looking statements” within the meaning of Federal securities laws. These statements are subject to a variety of uncertainties, unknown risks and other factors concerning the Company’s operations and business environment, which are difficult to predict and often beyond the control of the Company. Important factors that could cause actual results to differ materially from those suggested by these forward-looking statements, and that could adversely affect the Company’s future financial performance, include, but are not limited to the following:
— the availability and cost of energy, raw materials and other supplies;
— intense competition in the markets the Company serves;
— successful execution of projects designed to improve operating margins;
— the unpredictability and cyclicality of demand in the Company’s markets;
— exposure to currency conversion and changing global economic, social and political conditions;
— the Company’s ability to compete lawfully with local competitors in the Asia-Pacific region;
— aggressive global regulation of hazardous materials could affect sales of the Company’s products;
— costs of compliance with stringent environmental, health and safety regulations;
— access to capital markets or borrowings;
— variable interest rates on some of the Company’s external borrowings could increase;
— encumbrances on the Company’s assets granted to lenders affect its flexibility to dispose of assets;
— restrictive covenants in the Company’s credit facilities could affect its flexibility in funding strategic initiatives;
— the ability to utilize significant deferred tax assets;
— the outcome of any legal claims against the Company;
— the Company’s ability to continuously introduce new products to respond to demand;
— relationships with employees or employees’ representatives could deteriorate;
— the uncertainty of future employee benefit costs and the impact of funding of those costs;
— the Company’s restructuring programs may not provide sufficient cost savings;
— intangible asset risks;
— material weaknesses in internal controls and possible future material weaknesses; and
— risks associated with acts of God, terrorists, and others, as well as fires, explosions, wars, riots, accidents, embargoes, natural disasters, strikes and other work stoppages, quarantines and other governmental actions, and other events or circumstances that are beyond the Company’s reasonable control.
Additional information regarding these risk factors can be found in the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2008 and other filings with the SEC.
The risks and uncertainties identified above are not the only risks the Company faces. Additional risks and uncertainties not presently known to the Company or that it currently believes to be immaterial also may adversely affect the Company. Should any known or unknown risks and uncertainties develop into actual events, these developments could have material adverse effects on the Company’s business, financial condition and results of operations.
This release contains time-sensitive information that reflects management’s best analysis only as of the date of this release. The Company does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release.