Georgia Gulf Corporation today announced financial results for the quarter ended March 31, 2012.

The company reported net sales of $859.9 million for the first quarter of 2012, 9 percent higher than the net sales of $787.9 million reported for the first quarter of 2011. Georgia Gulf reported net income of $35.3 million, or $1.01 per diluted share, for the first quarter of 2012, compared to net income of $12.1 million, or $0.35 per diluted share, for the first quarter of the previous year. Net income for the first quarter of 2012 includes a pre-tax $12.4 million net benefit from gain on sale of assets, restructuring and other.

"These operating results were the best Georgia Gulf has reported for the first quarter in the past six years and demonstrate the company's improvement in generating shareholder value despite marginal economic conditions and a sluggish housing market," said Paul Carrico, president and chief executive officer. "Our integrated chemicals and building products businesses provide a solid foundation for North American sales, and our strategic shift during the past few years to expand our global capabilities has diversified our opportunities in the market.

"Looking at the remainder of 2012 and slightly beyond, we are cautiously optimistic that the North American housing market has started to recover after record low levels the past few years," Carrico said. "We also expect that the cost advantage of domestic natural gas and growing global demand should provide solid support for attractive operating rates in the vinyl industry, especially for housing and water infrastructure applications."

Chlorovinyls

In the Chlorovinyls segment, first quarter 2012 net sales increased to $329.5 million from $326.3 million during the first quarter of 2011. The segment posted operating income of $51.9 million, compared to operating income of $37.7 million for the same quarter in the prior year. The increase in operating income was due to a $17.4 million gain resulting from the sale of air separation assets at our Plaquemine facility. After adjusting for the impact of the $17.4 million gain, the segment experienced a decrease in operating income of $3.2 million due to a decline in overall sales volume caused by the previously disclosed unplanned chloralkali outages at the end of the fourth quarter of 2011 and the beginning of the first quarter of 2012 as well as higher ethylene costs. These negative impacts were partially offset by increases in the sales price of caustic soda and vinyl resins as well as lower chlorine and natural gas costs.

Building Products

In the Building Products segment, net sales were $187.2 million for the first quarter of 2012, increasing 19 percent on a reported basis compared to $157.5 million recorded for the same quarter in the prior year. On a constant currency basis, sales increased 20 percent. This sales increase was primarily driven by the benefit of higher sales volumes, including sales volumes resulting from the Exterior Portfolio acquisition in February 2011. Excluding the impact of Exterior Portfolio, sales increased 13 percent. The segment's operating loss was $6.4 million for the first quarter of 2012, compared to $12.1 million of operating loss during the same quarter of the prior year. The reduction in operating loss resulted from improved gross margins as a result of higher sales volumes, improved conversion costs and the addition of Exterior Portfolio. These positive impacts were partially offset by higher material and selling, general, and administrative costs. The first quarter of 2011 included the net benefit of $1.2 million relating to a $3.6 million reversal of a non-income tax reserve, partially offset by acquisition costs and one-time fair value amortization of inventory of $2.4 million relating to the Exterior Portfolio acquisition.

Aromatics

In the Aromatics segment, net sales increased to $343.2 million for the first quarter of 2012 from $304.1 million during the first quarter of 2011. The increase was primarily due to higher sales volumes. During the first quarter of 2012, the segment recorded operating income of $37.6 million, compared to operating income of $19.8 million during the same quarter in 2011. The increase in operating income was primarily due to higher sales volumes, higher margins, and a larger inventory holding gain during the first quarter of 2012 compared to the first quarter of 2011.

Liquidity

As of March 31, 2012, the company had $39.0 million of cash on hand as well as approximately $258 million of borrowing capacity available under its asset-based loan (ABL) facility.