Milacron’s Q3-06 Results in Line with Guidance; Revenues Up 9% From Year Ago

CINCINNATI, OHIO, November 3, 2006...Milacron Inc. (NYSE: MZ), a leading global supplier of plastics-processing technologies and industrial fluids, today reported third-quarter results in line with its August 3 guidance.

Consolidated Results
For the quarter ended September 30, 2006, Milacron incurred a net loss of $7.2 million, or $0.20 per diluted share, which included $2.9 million in restructuring charges.  This compared to a net loss of $6.9 million, or $0.18 per diluted share, in the third quarter of 2005, which included an after tax gain of $0.7 million from discontinued operations.

Manufacturing margins in the third quarter improved to 18.7% from 17.5% in the year-ago quarter, primarily as a result of better pricing and cost-reduction initiatives.

Sales for the third quarter were $209 million, up 9% over last year’s $191 million.  New orders of $201 million were up 5% from $191 million in the third quarter of 2005.

Cash on hand at the end of the quarter was $36 million, and Milacron had approximately $36 million available for borrowing under its asset-based revolving credit facility.  Despite making a $30 million voluntary advance contribution to its U.S. defined benefit plan in September, the company’s liquidity (cash plus borrowing availability) stood at $72 million at the end of the quarter, down only $6 million from the prior quarter.  Credit for this pre-payment, which was funded primarily through asset liquidations and disposals, will eliminate the requirement for any contributions to this plan in 2007.

“We are making progress on several fronts,” said Ronald D. Brown, chairman, president and chief executive officer. “In the third quarter, we satisfied a significant pension funding obligation with limited impact on our liquidity.  We further expanded our aftermarket sales and our presence in emerging markets.  And we are on track to complete the bulk of our previously announced consolidation by year-end, with full benefits expected in 2007.  We must continue to build on this progress going forward,” he said.

Consolidation Plan
Milacron’s consolidation plan, which calls for streamlining the organization and reducing the overall cost structure, is on track for completion by early 2007.  In total, the restructuring actions are expected to result in charges of approximately $18 million, of which about $13 million will be in cash, spread over 2006 and the first half of 2007.  The plan is projected to generate up to $15 million in annualized savings, of which $4 million to $5 million is expected to be realized in 2006.

Segment Results

Machinery Technologies-North America (machinery and related parts and services for injection molding, blow molding and extrusion supplied from North America, India and China) Boosted by higher shipments of injection molding machines, sales rose to $106 million, up 22% over sales of $87 million in the same period last year.  Segment earnings rose to $6.0 million from $4.3 million in the year-ago quarter.  New business increased across the board for injection molding, blow molding and extrusion equipment, climbing 19% to $106 million from $89 million, aided in part by orders received at NPE 2006, the major triennial plastics industry trade show held this summer.

Machinery Technologies-Europe (machinery and related parts and services for injection molding and blow molding supplied from Europe) As demand in Western Europe remained soft, third-quarter new orders of $31 million were down from $34 million in the year-ago quarter.  Aided by favorable currency translation effects, however, sales of $40 million were up from $37 million in the third quarter of 2005.  Additional expenses incurred in the implementation of a new ERP (enterprise resource planning) system during the quarter were offset by restructuring benefits, as the segment narrowed its operating loss to $0.7 million from $1.5 million a year ago.

Mold Technologies (mold bases and related parts and services, as well as maintenance, repair and operating supplies for injection molding worldwide)  Softness in the North American market, particularly in the automotive sector, led to a sales decline in the third quarter to $38 million from $41 million a year ago.  Benefits from restructuring as well as other cost reductions reduced losses of $0.7 million a year ago to breakeven for the quarter.

Industrial Fluids (water-based and oil-based coolants, lubricants and cleaners for metalcutting and metalforming operations worldwide) Improved pricing in North America and Western Europe helped boost sales and earnings.  Sales were $29 million, up $2 million over the third quarter of 2005.  Segment earnings of $1.9 million, up slightly from $1.8 million a year ago, were held back in part by additional expenses associated with expanding distribution in emerging markets and continued raw material cost increases.

Dividends
Milacron declared two quarterly dividends of $1.00 per share each ($2.00 total) on its 4% Cumulative Preferred Stock, the accrued September 2006 dividend and the December 2006 dividend, both payable on December 1 to the holders of record on November 17.  The company continues to accrue dividends on its 6% Series B Convertible Preferred Stock.  No dividends were declared on its common stock.  Milacron currently has outstanding: 60,000 shares of 4% Cumulative Preferred Stock, 500,000 shares of 6% Series B Convertible Preferred Stock, and approximately 52 million shares of common stock.

Outlook

“In the fourth quarter, we could see slightly lower net results compared to the third quarter due to higher restructuring costs,” Brown said.

“Longer term, Milacron’s outlook remains positive.  For 2007, we are planning on 4% to 5% top-line growth overall.  We expect growth outside U.S. and Western European markets to exceed this rate, as we continue to expand our global presence.  Greater sales volume, improved pricing, incremental restructuring benefits and other cost reductions should lead to better margins,” he said.

Investor Conference Call

Today at 1:00 p.m. EST, Milacron will hold an open investor conference call, which can be accessed live at www.milacron.com.  The dial-in number for those interested in asking questions is (913) 981-5592 or (888) 202-2422.  A recording of the conference call will be available from 4:00 p.m. today through midnight November 10 on Milacron’s website or by phone: (719) 457-0820 or (888) 203-1112 and providing the access code: 5936364.

The forward-looking statements above by their nature involve risks and uncertainties that could significantly impact operations, markets, products and expected results. For further information please refer to the Cautionary Statement included in the company’s most recent Form 10-Q on file with the Securities and Exchange Commission.

First incorporated in 1884, Milacron is a leading global supplier of plastics-processing technologies and industrial fluids, with major manufacturing facilities in North America, Europe and Asia.  For further information, visit www.milacron.com or call Milacron’s toll-free investor line: (800) 909-6452.