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HARSCO CORPORATION REPORTS THIRD QUARTER 2015 RESULTS
November 9, 2015

FOR IMMEDIATE RELEASE

HARSCO CORPORATION REPORTS THIRD QUARTER 2015 RESULTS

• Solid Q3 Adjusted Operating Income; Metals & Minerals and Rail Performance as well as Lower Corporate Spending Contributed to Positive Results

• Organization Changes Under Project Orion Largely Complete with Ongoing Total Benefits of More Than $36 Million; 65 Percent of Underperforming Sites Now Finalized; Project Orion Phase 3 Launched With Benefits Targeted at Additional $20 Million to $25 Million

• 2015 Adjusted Operating Income Guidance Narrowed to Range of $125 Million to $130 Million; Free Cash Flow Expected to be $50 Million to $60 Million

• Net Leverage Ratio Stood at 2.7x and Liquidity Totaled Approximately $450 Million at Quarter-End, Prior to the Repayment of Notes in October 2015, and Approximately $200 Million Giving Effect to the Repayment

• Harsco Adjusts Quarterly Dividend to $0.05 Per Share

 

CAMP HILL, PA (November9, 2015) . . . Harsco Corporation (NYSE:HSC) today reported third quarter 2015 results. Excluding certain special items, adjusted diluted earnings per share from continuing operations in the third quarter of 2015 were $0.18. This result compares with adjusted diluted earnings per share of $0.31 in the third quarter of 2014. On a U.S. GAAP (“GAAP”) basis, third quarter 2015 diluted loss per share from continuing operations was $0.10 which included Project Orion exited site costs, contract termination and resolution charges, and other adjustments.

Adjusted operating income for the third quarter of 2015 was $35 million, which was above the guidance range of $20 million to $25 million provided by the Company. Also, the Company’s third quarter 2015 earnings included equity income of approximately $3 million ($0.02 per share after tax) from the Brand Energy joint venture.

“Third quarter results were stronger than expected primarily due to favorable product mix and timing in Rail and cost control efforts in Metals & Minerals,” said President and CEO Nick Grasberger. “Also, Industrial performed well in the quarter as additional cost initiatives offset weakened demand from energy customers. Looking forward, we expect that our businesses’ results will continue to be impacted by macroeconomic headwinds within the metals and industrials markets.”

Mr. Grasberger continued, “Additionally, we’ve made further progress transforming Metals & Minerals into a leaner and more disciplined business. We addressed a number of underperforming sites in recent months and we remain focused on achieving additional cost reduction and operational improvements to enhance returns for this segment. We are pleased that Rail has successfully executed against key growth goals and that Industrial has improved its competitive position through lean manufacturing processes and production innovation. Overall, we continue to see considerable potential for value creation within the Harsco businesses and are laser focused on rebalancing our business portfolio to the benefit of our shareholders. In this regard, we have now commenced a formal process to evaluate all strategic options for the separation of the Metals & Minerals segment from the Industrial and Rail businesses and Brand joint venture, representing the next step in Harsco’s effort to optimize its portfolio.”

Mr. Grasberger concluded, “Despite the significant internal progress, external market pressures continue to persist, impacting our outlook. In light of these factors, and our expectation that these trends will continue in the near-term, the Harsco Board decided to adjust the quarterly dividend to allow Harsco to maintain a healthy capital structure while still returning capital to shareholders.”

 

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