Event Brief of Q1 2004 Olin Earnings Conference Call - Final.

Original Source: FD (FAIR DISCLOSURE) WIRE

CORPORATE PARTICIPANTS

. Joseph Rupp, Olin Corporation, President & CEO . Anthony Ruggiero, Olin Corporation, EVP & CFO . John McIntosh, Olin Corporation, President, Chlor Alkali Products . Richard Koch, Olin Corporation, VP, IR

OVERVIEW

OLN announced 1Q04 net income of $2.9m, or $0.04 per diluted share. Sales were 25% higher than 1Q03, and sales increased in all segments. A $125m contribution was made to pensions, and a corporate relocation is in progress. EPS in 2Q04 expected to be $0.10 Q&A focus: anticipated non-recurring; pension contribution; tax issues.

FINANCIAL DATA

A. Key Data From Call 1. 1Q04 Sales Increase = 25% 2. Net Income = $2.9m ($0.04 per diluted share) 3. Cash and Equivalents = $185.8m

4. Guidance for 2Q04 EPS = $0.10

PRESENTATION SUMMARY

S1. Company Activities (J.R.) 1. Sales in 1Q04 were 25% higher than 1Q03. 2. Net income was $2.9m ($0.04 per diluted share). 1. Includes $8.9m of previously announced $12m pretax charge related to corporate relocation. 1. Excluding this charge, OLN would have earned $0.13 per diluted share. 1. 1Q03 net loss was $39m ($0.67 per diluted share). 2. Adjusted net income was $5.1m ($0.09 per diluted share) before accounting and restructuring charges. 3. 1Q04 adjusted earnings of $0.13 better than guidance. 1. Higher than expected performance in metals and Winchester. 2. Lower pension expenses due to $125m contribution. 3. Lower tax rate. 4. Improvement in rolled and shaped products exceeded expectations. 5. Lead times returning to more normal levels. 6. Chlor Alkali products had solid performance. 4. Metals segment. 1. Sales were $314.4m vs. $222.2m in 1Q03, up 41%. 1. Most major markets strengthened over 2003. 2. Shipments contributed 13% of the increase.

3. Remaining 28% was due to significantly higher copper prices and a mix shift. 1. Shipments in automotive increased by 3%. 2. Coinage and electronic shipments were up 79% and 18% respectively. 3. Ammunition shipments doubled in 2004 from 2003. 2. Operating income was $14.7m vs. $3.4m in 2003. 1. In 2Q04, expect industry demand to be slightly down. 3. China JV recorded first shipments in 1Q04; additional machinery being installed in 2Q04. 5. Chlor Alkali segment. 1. Sales were $99.9m vs. $97.3m in 1Q03. 2. Operating income was $10.4m vs. $13.5 in 1Q03. 3. ECU netback was $300 vs. $315 in 1Q03. 1. Expect to decrease in 2Q04 as contracts reflect market price declines for caustic soda. 4. Some excess industry cost of supply depressed prices. 1. Chlorine price increase of $75 per ton was announced. 5. Industry operating rates increased to 94% in Feb. and OLN believes will increase further in 2Q04.

1. CMAI beleves ECU 1Q04 prices will be lowest of the year and

will increase each quarter. 6. OLN converting a portion of cost of capacity at Charleston to potassium hydroxide. 1. Capacity of 160,000 tons of KOH will reduce caustic soda capacity by 110,000 tons. 1. Minimum capex involved. 2. Will complete conversion and begin shipping in 4Q04. 3. Will reduce caustic production capacity by 8%. 6. Winchester segment. 1. Sales were $74.7m vs. $70.7m in 1Q03. 2. Operating income was $6.1m vs. $5.9m in 1Q03. 3. Won contract to provide ammunition to Homeland Security; will

commence in 2Q04. 1. Military contract for 70m rounds of 5.6mm rifle ammunition beginning in June. 2. Several additional military procurements are pending.

S2. Financials: T.R. 1. Pension 1. Service costs related to employees are allocated to appropriate segments. 2. 'Other' includes expected return on plan assets and actuarial gains and losses.

3. Pension income in corporate other was $2m vs. $4.5 in 2003.

4. 1Q04 company-wide pension expenses were $3.3m vs. $1.3m in

2003. 1. May make voluntary contribution in $40m pre-tax range in 2005. 5. If so, no other contributions required until 2008. 6. OLN now expects pension expenses to increase in 2004 by $10m; slightly below that in 1Q04. 2. Charges to income for environmental and investigatory activities were $6.3m vs. $3.7m in 2003. 1. Related to past manufacturing operations and former waste disposal sites. 2. 2004 estimated charges may be $25m vs. $20m in 2003. …