Thursday, specialty chemicals company Cytec Industries Inc. (CYT)reported a drop in third quarter earnings, reflecting declined sales across all segments year-on-year. Adjusted earnings, however, topped Street estimates. Looking ahead, the company boosted its full year earnings guidance.
The Woodland Park, New Jersey-based Cytec posted net earnings attributable to the company of $12.5 million or $0.26 per share, down from $46.3 million or $0.96 per share in the prior year period.
Excluding special items, net earnings declined to $27.6 million or $0.57 per share for the quarter from $51.2 million or $1.06 per share a year ago. On average, seven analysts polled by Thomson Reuters expected the company to earn $0.34 per share for the quarter. Analysts' estimates typically exclude special items.
Included in the net earnings for the quarter were a charge of $15.3 million or $0.32 per share associated with various restructuring; a loss of $5.5 million or $0.11 per share related to the debt tender completed in July 2009; and a non-cash gain of $5.7 million after-tax or $0.12 per diluted share on sale of land.
Quarterly sales slipped to $740 million from $963.0 million a year ago, but bettered analysts' estimate of $710.67 million. Segment wise, coating resins sales decreased 23% to $336 million year on year, while additive technologies sales slipped 20% to $65 million. In process separation sales declined 14% to $71 million, as engineered materials sales dipped 24% to $169 million. Building block chemicals sales were down by 29% to $99 million. For the year-to-date period, Cytec reported a net loss of $12.4 million or $0.26 per share, down from $152.0 million or $3.12 per share in the corresponding period last year. Excluding items, net earnings plunged to $29.7 million or $0.62 per share from $152.0 million or $3.12 per share a year ago.
Net sales for the nine-month period declined to $2.038 billion from $2.942 billion in the comparable period last year.
Shane Fleming, chairman, president and chief executive officer, said, "Our results this past quarter demonstrate the excellent progress we have made with our restructuring efforts and our working capital initiative. In addition, the sales growth versus the second quarter shows evidence of restocking activity across the Specialty Chemicals markets."
Taking all factors into account, the company raised its full year adjusted earnings guidance to a range of $0.80 to $1.00 per share from the prior guidance of $0.60 to $0.90 per share. Analysts are currently looking for earnings of $0.81 per share.
CYT closed Thursday's regular trading at $34.56, down $0.59 or 1.68%, on a volume of about 969 thousand shares. In the after hours, the stock gained $1.94 or 5.61% and traded at $36.50.
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