W.R. Grace shows $21.1 million second-quarter income before Ch. 11 expenses, taxes, minority interests

By Caroline Salls

Pittsburgh, Aug. 8 - W.R. Grace & Co. reported a $21.1 million income before Chapter 11 expenses, income taxes and minority interests for the second quarter on $729.1 million in net sales, according to a 10-Q filing with the Securities and Exchange Commission.

The figures show improvement over $611.7 million income before Chapter 11 expenses, income taxes and minority interests for the same quarter of 2005 on $676.5 million in net sales.

The net loss for the 2006 quarter was $5.2 million, improved from a $32.7 million net income the year before.

For the six months ended June 30, the income before Chapter 11 expenses, income taxes and minority interest was $41.2 million on $1.39 billion in net sales, compared with $86 million in the second quarter of 2005 on $1.28 billion in net sales.

Cash on June 30 was $443.2 million, up from $404 million on June 30, 2005. Cash and cash equivalents on Dec. 31, 2005 were $474.7 million.

According to the filing, the sales increase can be attributed to higher sales volume in all geographic regions, improved product mix and selling price increases in response to cost inflation.

Grace said the pre-tax income from core operations is attributable to higher sales volume in all geographic regions and higher selling prices to partially offset cost inflation, and from lower overall pension costs.

In addition, the second-quarter and year-to-date net loss is attributable to a $30 million increase in the estimated liability for environmental remediation, primarily related to the company's former vermiculite mining operation in Montana, and to $24.3 million of expense for Chapter 11, litigation and other matters not related to core operations.

W.R. Grace, a Columbia, Md.-based specialty chemicals company, filed for bankruptcy on April 2, 2001 in the District of Delaware. Its Chapter 11 case number is 01-01139.

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