DeSoto Inc. said Thursday it will sell its automotive coatings and fireplace furnishings businesses and certain industrial chemical products as part of a restructuring.
The company, based in northwest suburban Des Plaines, said that disposing of the operations will reduce its third quarter pretax earnings by an estimated $14.1 million. As a result, DeSoto said its earnings for the quarter ”will not match” the year-earlier results, when it posted net income of $4.1 million, or 86 cents a share.
Richard R. Missar, DeSoto`s president and chief executive officer, said the restructuring will allow the company to concentrate resources on consumer paint, industrial coatings, specialty chemical and detergent businesses that
”generate more attractive returns on investment.”
”These actions are expected to make DeSoto a leaner, more profitable company in the future and to free up resources and capital to stimulate greater growth internally and through acquisition,” Missar said.
The businesses to be sold have annual sales of about $30 million, the company said.
DeSoto also plans to sell a coatings/detergent plant in California as part of a consolidation of its West Coast consumer paint and detergent operations.
For the first six months, DeSoto`s net earnings fell to $7.3 million, or $1.53 a share, from $10 million, or $2.11 a share, in the year-earlier period.
