Eastman Chemical Company Recasted Segment Results
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION 
WASHINGTON, DC 20549 

FORM 8-K 
CURRENT REPORT

Pursuant to Section 13 or 15 (d) of the Securities and Exchange Act of 1934

Date of report (Date of earliest event reported):
April 20, 2006 

EASTMAN CHEMICAL COMPANY
(Exact Name of Registrant as Specified in Its Charter)

 
 
 
 
 
Delaware
 
1-12626
 
62-1539359
(State or Other Jurisdiction of
 
(Commission File Number)
 
(IRS Employer Identification No.)
Incorporation)
 
 
 
 

 
 
 
200 South Wilcox Drive, Kingsport, TN
 
37660
(Address of Principal Executive Offices)
 
(Zip Code)

(423) 229-2000
(Registrant’s Telephone Number, Including Area Code)
 
     
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
o
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
      
 
o
 
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
      
 
o
 
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
      
 
o
 
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 


 
ITEM 8.01. OTHER EVENTS

Eastman Chemical Company’s products and operations have been managed and reported in six reportable operating segments, consisting of the Coatings, Adhesives, Specialty Polymers and Inks ("CASPI") segment, the Fibers segment, the Performance Chemicals and Intermediates ("PCI") segment, the Polymers segment, the Specialty Plastics ("SP") segment and the Developing Businesses ("DB") segment. The Company's segments were previously aligned in a divisional structure that provided for goods and services to be transferred between divisions at predetermined prices that may have been in excess of cost, which resulted in the recognition of intersegment sales revenue and operating earnings between divisions. Such interdivisional transactions were eliminated in the Company's consolidated financial statements. In first quarter 2006, the Company realigned its organizational structure to support its growth strategy and to better reflect the integrated nature of the Company's assets. A result of the realigned organizational structure is that goods and services are transferred among the segments at cost. As part of this change, the Company's segment results for 2002 through 2005 have been restated to eliminate the impact of interdivisional sales revenue and operating earnings, as shown in the tables below.
 
EASTMAN CHEMICAL COMPANY
SEGMENT INFORMATION
  
2005
  
 
                       
(Dollars in millions)
  
1st Qtr
 
2nd Qtr
 
3rd Qtr
 
4th Qtr
 
Year
 
                       
CASPI Segment
                      
Sales
  
$
319
  
$
325
  
$
333
  
$
322
  
$
1,299
  
Operating Earnings
    
67
    
64
    
63
    
34
    
228
  
Fibers Segment
                                
Sales
  
$
200
  
$
205
  
$
228
  
$
236
  
$
869
  
Operating Earnings
    
48
    
47
    
60
    
61
    
216
  
PCI Segment
                                
Sales
  
$
389
  
$
397
  
$
428
  
$
413
  
$
1,627
  
Operating Earnings
    
45
    
43
    
40
    
13
    
141
  
Polymers Segment
                                
Sales
  
$
656
  
$
642
  
$
646
  
$
575
  
$
2,519
  
Operating Earnings
    
84
    
50
    
32
    
12
    
178
  
SP Segment
                                
Sales
  
$
177
  
$
180
  
$
179
  
$
182
  
$
718
  
Operating Earnings
    
21
    
21
    
17
    
5
    
64
  
DB Segment
                                
Sales
  
$
21
  
$
3
  
$
2
  
$
1
  
$
27
  
Operating Earnings
    
(21
)
  
(22
)
  
(14
)
  
(13
)
  
(70
)
Eastman Chemical Company
                                
Sales
  
$
1,762
  
$
1,752
  
$
1,816
  
$
1,729
  
$
7,059
  
Operating Earnings
    
244
    
203
    
198
    
112
    
757
  




EASTMAN CHEMICAL COMPANY
SEGMENT INFORMATION
        
2004
 
                       
(Dollars in millions)
  
1st Qtr
 
2nd Qtr
 
3rd Qtr
 
4th Qtr
 
Year
 
                       
CASPI Segment
                      
Sales
  
$
439
  
$
476
  
$
357
  
$
282
  
$
1,554
  
Operating Earnings
    
28
    
(24
)
  
37
    
23
    
64
  
Fibers Segment
                                
Sales
  
$
172
  
$
181
  
$
184
  
$
194
  
$
731
  
Operating Earnings
    
35
    
37
    
45
    
38
    
155
  
PCI Segment
                                
Sales
  
$
290
  
$
313
  
$
371
  
$
373
  
$
1,347
  
Operating Earnings
    
1
    
8
    
(13
)
  
4
    
--
  
Polymers Segment
                                
Sales
  
$
515
  
$
515
  
$
542
  
$
611
  
$
2,183
  
Operating Earnings
    
(7
)
  
20
    
7
    
9
    
29
  
SP Segment
                                
Sales
  
$
157
  
$
154
  
$
164
  
$
169
  
$
644
  
Operating Earnings
    
(22
)
  
18
    
18
    
(1
)
  
13
  
DB Segment
                                
Sales
  
$
24
  
$
37
  
$
31
  
$
29
   $
121
  
Operating Earnings
    
(20
)
  
(18
)
  
(21
)
  
(27
)
  
(86
)
Eastman Chemical Company
                                
Sales
   $
1,597
   $
1,676
$
1,649
  
$
1,658
 $
6,580
  
Operating Earnings
    
15
    
41
    
73
    
46
    
175
  




EASTMAN CHEMICAL COMPANY
SEGMENT INFORMATION
        
2003
 
                       
(Dollars in millions)
  
1st Qtr
 
2nd Qtr
 
3rd Qtr
 
4th Qtr
 
Year
  
                       
CASPI Segment
                      
Sales
  
$
411
  
$
441
  
$
422
  
$
409
  
$
1,683
  
Operating Earnings
    
(4
)
  
19
    
(436
)
  
17
    
(404
)
Fibers Segment
                                
Sales
  
$
146
  
$
166
  
$
163
  
$
160
  
$
635
  
Operating Earnings
    
25
    
36
    
36
    
30
    
127
  
PCI Segment
                                
Sales
  
$
297
  
$
286
  
$
261
  
$
254
  
$
1,098
  
Operating Earnings
    
1
    
2
    
(43
)
  
(10
)
  
(50
)
Polymers Segment
                                
Sales
  
$
430
  
$
434
  
$
442
  
$
450
  
$
1,756
  
Operating Earnings
    
29
    
25
    
4
    
6
    
64
  
SP Segment
                                
Sales
  
$
144
  
$
138
  
$
135
  
$
142
  
$
559
  
Operating Earnings
    
31
    
9
    
11
    
10
    
61
  
DB Segment
                                
Sales
  
$
13
  
$
16
  
$
21
  
$
19
  
$
69
  
Operating Earnings
    
(23
)
  
(16
)
  
(13
)
  
(13
)
  
(65
)
Eastman Chemical Company
                                
Sales
  
$
1,441
  
$
1,481
  
$
1,444
  
$
1,434
  
$
5,800
  
Operating Earnings
    
59
    
75
    
(440
)
  
39
    
(267
)




EASTMAN CHEMICAL COMPANY
SEGMENT INFORMATION
        
2002
 
                       
(Dollars in millions)
  
1st Qtr
 
2nd Qtr
 
3rd Qtr
 
4th Qtr
 
Year
  
                       
CASPI Segment
                      
Sales
  
$
380
  
$
427
  
$
417
  
$
377
  
$
1,601
  
Operating Earnings
    
25
    
18
    
20
    
(17
)
  
46
  
Fibers Segment
                                
Sales
  
$
149
  
$
172
  
$
165
  
$
156
  
$
642
  
Operating Earnings
    
36
    
44
    
37
    
27
    
144
  
PCI Segment
                                
Sales
  
$
244
  
$
261
  
$
265
  
$
253
  
$
1,023
  
Operating Earnings
    
(1
)
  
(1
)
  
7
    
3
    
8
  
Polymers Segment
                                
Sales
  
$
341
  
$
400
  
$
382
  
$
387
  
$
1,510
  
Operating Earnings
    
21
    
30
    
3
    
(8
)
  
46
  
SP Segment
                                
Sales
  
$
120
  
$
133
  
$
141
  
$
134
  
$
528
  
Operating Earnings
    
11
    
8
    
11
    
4
    
34
  
DB Segment
                                
Sales
  
$
2
  
$
2
  
$
4
  
$
8
  
$
16
  
Operating Earnings
    
(15
)
  
(18
)
  
(17
)
  
(20
)
  
(70
)
Eastman Chemical Company
                                
Sales
  
$
1,236
  
$
1,395
  
$
1,374
  
$
1,315
  
$
5,320
  
Operating Earnings
    
77
    
81
    
61
    
(11
)
  
208
  






SIGNATURE 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
 
 
 
 
 
 
 
 
Eastman Chemical Company
 
 
 
 
 
 
(Registrant)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  Date: 
 
April 20, 2006
 
By:
 
  /s/ Curtis E. Espeland
 
 
 
 
 
 
 
 
 
 
 
Curtis E. Espeland,
 
 
 
 
Vice President and Chief Accounting Officer,