SAFC's organic growth expectations for 2008 have been moderated to a new range of 4% to 5%, reflecting recent economic and industry conditions that have slowed growth in the past two quarters and that are expected to carry into the fourth quarter. A carryover benefit in Q1 2008 from the February 2007 acquisition of Epichem, an innovator in developing and supplying high performance semiconductor materials, is expected to add modestly to full year organic growth.
Ongoing efforts to identify and pursue desirable acquisition candidates or technology access arrangements may further enhance growth in 2008 as we continue to seek to add additional ongoing revenue streams through the acquisition of strategically important products, services, platform technologies, businesses and facilities.
Our reaffirmed forecast for diluted earnings per share for all of 2008
is a range of $2.62 to $2.72, a 12.0% to 16.2% increase over 2007's $2.34.
This expectation is based on our 2008 year-to-date results, the sales
expectations described above, currency rates remaining at September 30,
2008 levels, the expected pretax income margin and tax rate described below
and other expectations for our business. Pretax income margins for the full
year are expected to improve from the 21.5% achieved in 2007 as a result of
favorable currency rates for the full year, lower interest rates, modest
contributions from the Company's supply chain initiative and other margin
improvement initiatives. We believe we have the ability to offset current
and anticipated higher input costs with recent selling price increases. The
previously forecasted effective tax rate for all of 2008 has been lowered
to approximately 31% of pretax income, reflecting the reinstatement of the
U.S. R&D tax credit on October 3, 2008 which will provide benefits starting
in Q4 2008. Variations to our forecast tax rate and for
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