Discontinued Operations - Integrated Nylon Segment
As announced previously, Solutia has entered into a definitive agreement to sell its nylon business and results for this business are reported as Discontinued Operations. In the first quarter, income from discontinued operations decreased $345 million to a net loss of $155 million, in comparison to the same period in 2008. The first quarter results for 2009 were negatively impacted by non-cash charges of $101 million, net of tax to adjust the book value of the Nylon business to its estimated fair value as of the March 31, 2009. The first quarter results for 2008 were impacted by reorganization items and certain gains and losses totaling a net gain of $210 million. Despite continued demand pressure in this business, discontinued operations provided cash of $35 million in the first quarter, as a reduction in working capital more than offset the operating losses of the business.
"The nylon sale will complete Solutia's transformation into a pure-play performance materials and specialty chemicals company. Our going-forward portfolio of high-margin businesses with world-leading positions sets the stage for long-term growth and success once economic conditions improve," added Quinn.
Leverage and Liquidity
For the first quarter of 2009, the Company reduced net debt by $50 million to $1,314 million and had liquidity of $163 million. Cash provided by continuing operations before reorganization activities for the quarter was $30 million compared to a use of $36 million for the same period for 2008. The improvement in cash from continuing operations was primarily attributed to improvements in working capital, lower incentive payments and lower funding of pension and other postretirement benefit plans.
"As we stated during our fourth quarter conference call, we are focused on preserving and enhan
|SOURCE Solutia Inc.|
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