Ferro Corp. (FOE) is a global supplier of technology-based performance materials for manufacturers. Ferro makes materials, such as enamel, ink and glaze, that enhance the performance of products in building and construction, automotive, appliances, electronics and household furnishings.
Gabelli’s trade coincides with Ferro’s ongoing plan to execute value creation strategies and cost-saving actions that are adding up. The company anticipates adjusted earnings for the full-year ending Dec. 31, 2013, to be $0.30 to $0.35 per share, compared to the previously announced range of $0.25 to $0.30. This guidance is based on preliminary first-quarter results and the progress made to date on the company’s cost-saving initiatives. For 2015, Ferro expects adjusted earnings per share of $0.90 to $1.00, compared to the previously announced range of $0.75 to $0.85.
Ferro is also trimming operational costs. As part of Ferro’s cost-saving initiative, with a goal of saving $30 million in 2013 and reaching $70 million in 2014, the company entered into a global shared services agreement with Capgemini, one of the world’s foremost providers of technology, consulting and outsourcing services, with more than 120,000 employees in 40 countries. According to Ferro, the global shared services model will enable the company to drive greater operational efficiencies and create a scalable back-office operation. Capgemini will extend Ferro’s current reach from 26 countries to 40 countries and beyond.
To allow the company to focus on its core business, Ferro also sold its pharmaceuticals business, Pfanstiehl Laboratories, to PLI Holdings Inc., an affiliate of Med Opportunity Partners LLC, for approximately $16.9 million cash, with an earn-out incentive payment of up to $8 million. The pharmaceutical divestiture follows the company’s February sale of its solar pastes assets.
Ferro’s Interim President and CEO Peter Thomas said, “The sale of our pharmaceuticals business is another important milestone in our value creation strategy. The Ferro portfolio now is more fully concentrated in our core technologies in coatings and color and glass science, polymer science, and organic synthesis…"
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