Rohm & Haas Company Announces a Comprehensive Set of Actions to Restore Profitability Conference Call - Final.

Original Source: FD (FAIR DISCLOSURE) WIRE

OPERATOR: Good day, and welcome to today's Rohm & Haas Company conference call. Today's call is being recorded. We will now turn the call over to Mr. Andrew Sandifer, Director of Investor Relations.

ANDREW SANDIFER, DIRECTOR OF IR, ROHM & HAAS COMPANY: Good morning. Thank you for joining us on the call this morning, particularly on such short notice. With me here in Philadelphia today is Raj Gupta, Chairman and Chief Executive Officer, and Jacques Croisetiere, Executive Vice President, Chief Financial Officer and Chief Strategy Officer. Pierre Brondeau, President and Chief Operating Officer, cannot join us this morning as he is currently in Saudi Arabia meeting with executives of our joint venture partners.

Before I turn the call over to Raj and Jacques, let me remind you that some of what you hear today constitute forward-looking statements subject to certain risks and uncertainties. Additional information is available in Rohm and Haas Company's 10-K filing with the Securities and Exchange Commission on February 21st, 2008. A copy of these filings may also be found through the investor portion of our website at www.RohmHaas.com.

Our agenda today is to have Raj first provide some context for the actions we announced this morning to restore profitability, and how they relate to our Vision 2010 strategy. Jacques will then provide more detail on the specific initiatives, then Raj will close with some commentary on current business environment. We'll then entertain your questions and expect to finish the call in approximately 30 minutes. Now let me turn the call over to Raj.

RAJ GUPTA, CHAIRMAN AND CEO, ROHM & HAAS COMPANY: Thank you Andrew, good morning everyone. Thank you all for joining us this morning. Today we have announced a comprehensive set of actions to restore our profitability, primarily in the North American Chemicals business. That's important to note, and maintain the momentum we established to accelerate shareholder value through our Vision 2010 plan.

Today's actions involve realignment of our manufacturing footprint in Support Services, primarily in North America, and are consistent with the goals and initiatives we have been discussing since we began implementing our strategic plan. A couple of observations I would like to make about these actions. The footprint realignment in the Specialty Materials business reflects the substantial increase in capacity we have been able to gain through the productivity initiatives of the past several years, as well as lower than expected demand for acrylic emulsions and slower growth, more developed mature markets.

These conditions allow us to take significant cost and capacity out of the network while preserving our capability to support growth we expect through market expansion and market share gains in the future. The Electronic Materials footprint changes reflect the ongoing adjustment of both our manufacturing and technical service footprint to be closer to the customer base, which is increasingly concentrated in the Asia-Pacific region.

The Shared Services adjustments we're making will improve our cost structure as well as better align these functional support activities to market changes that we're witnessing. These actions complement the pricing initiatives we launched in late April. We are successfully implementing price increase surcharges needed to recover the rapidly escalating raw material, energy and trade costs. We expect to have full impact of this by July 1, 2008.

While the actions today are accelerated by the current market conditions, particularly in North America, they are part of our long-term strategy to reposition the Company by focusing on our core strength in coating, electronics and (inaudible) (technical difficulty) businesses and our aggressive expansion in the rapidly developing economies while maintaining operational excellence. Now let me turn the call over to Jacques for more details on today's actions.

JACQUES CROISETIERE, CFO AND CHIEF STRATEGY OFFICER, ROHM & HAAS COMPANY: Thank you Raj, and thank you all once again for joining us today. As Raj explained, today's announcement is about restoring our North American Chemicals profitability, and reaching our Vision 2010 goals. These actions will impact approximately 925 positions, primarily in North America, and are expected to result in an estimated charge of $0.35 per share in the second quarter of this year.

We are expecting an estimated pretax annual run rate savings of approximately 110 million beginning in 2010 with slightly less than half of that benefit realized in 2009. As we mentioned in our …