Ashland Inc. (ASH) announced preliminary financial results for the quarter ended March 31, 2013, the second quarter of its 2013 fiscal year. Income from continuing operations for the quarter declined to $55 million, or $0.68 per share, from $90 million, or $1.13 per share in the year ago quarter. Net income per share for the quarter was $0.66 down from $1.10 last year.
The latest-quarter results included several key items that together reduced income from continuing operations by approximately $88 million, net of tax, or $1.10 per share. The two largest key items were related to debt refinancing during the quarter. The company incurred a $34 million after-tax cash expense related to the termination of interest-rate swaps and a $32 million after-tax non-cash charge related to accelerated debt issuance and other costs.
The year-ago results included three key items that had a combined negative effect of $31 million, net of tax, or 39 cents per share.
Excluding all items, adjusted earnings per share rose 17 percent, to $1.78, when compared to the year-ago quarter. Excluding items, adjusted income from continuing operations for the prior year quarter was $121 million, or $1.52 per share
Quarterly sales were $2.0 billion, down from $2.1 billion in the year ago quarter.
Analysts polled by Thomson Reuters expected the company to report earnings of $1.54 per share on revenues of $2.00 billion for the quarter. Analysts' estimates typically exclude special items.
In late 2011, the company outlined a plan to increase earnings to a range of $9.50-$10.50 per share and to grow EBITDA to $1.7 billion by fiscal 2014. That three-year plan was based on business forecasts as well as a variety of assumptions related to global economic growth, market demand and other factors, the company said.
However, the company said it is now halfway through that three-year plan and the reality is that some of those expectations, particularly those related to growth in emerging markets, have not materialized. As a result, the company's recent performance has been below target.
The company noted that in light of the broader economic challenges and market softness, it is now unlikely that it will be able to achieve that range for earnings per share or EBITDA.
The company said that while fiscal 2013 is shaping up to be more challenging than originally expected, its strategic focus has not changed.
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