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Kingsport, Tenn., USA, Apr 25, 2014 - (ACN Newswire) - Eastman Chemical Company (NYSE:EMN) today announced earnings, excluding non-core or non-recurring items, of $1.61 per diluted share for first quarter 2014 versus $1.62 per diluted share for first quarter 2013. Reported earnings were $1.52 per diluted share for first quarter 2014 versus $1.57 per diluted share for first quarter 2013. For detail of the excluded items and reconciliation to reported company and segment earnings, see Tables 3 and 4.
"We reported solid results in the first quarter despite a global economy that continues to be lackluster," said Mark Costa, CEO. "We remain focused on growth through Eastman-specific actions, including serving growing markets with capacity additions, improving our mix with premium products, and disciplined capital allocation. As a result, Eastman is well positioned for a fifth consecutive year of strong earnings growth." See the second paragraph under "Outlook" for the items excluded from annual earnings comparisons.
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(In millions, except per share amounts) 1Q2014 1Q2013
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Sales revenue $2,305 $2,307
Earnings per diluted share $1.52 $1.57
Earnings per diluted share excluding
non-core or non-recurring items* $1.61 $1.62
Net cash (used in) provided by operating activities ($30) $5
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* For reconciliation to reported company and segment earnings,
see Tables 3 and 4.
Corporate Results 1Q 2014 versus 1Q 2013
Sales revenue was $2.3 billion for both periods. Operating earnings for first quarter 2014 were $361 million compared with $393 million for first quarter 2013. Excluding the items described in Tables 3 and 4, first quarter 2014 operating earnings were $383 million compared with $403 million for first quarter 2013, with the decline primarily due to lower Specialty Fluids & Intermediates segment earnings. First-quarter 2014 operating earnings included lower "Other" operating losses as detailed in Table 3.
Segment Results 1Q 2014 versus 1Q 2013
Additives & Functional Products - Sales revenue increased slightly as higher sales volume for coatings more than offset lower sales volume for rubber additives. The higher sales volume for coatings was primarily attributed to strong demand in the building and construction and transportation markets. The lower sales volume for rubber additives was primarily attributed to customer inventory destocking in Asia Pacific. Operating earnings declined to $94 million for first quarter 2014 compared with $98 million for first quarter 2013 primarily due to higher raw material and energy costs, particularly for propane.
Adhesives & Plasticizers - Sales revenue was unchanged as higher sales volume for adhesives resins was offset by lower selling prices for both adhesives resins and plasticizers. Higher sales volume for adhesives resins was primarily attributed to stronger end-market demand, particularly for hygiene and packaging, and customer inventory destocking that negatively impacted first quarter 2013. Lower selling prices for adhesives resins were primarily due to continued competitive pressure resulting from greater industry supply attributed to increased availability of key raw materials and additional competitor capacity. Lower selling prices for plasticizers were primarily attributed to continued competitive pressures resulting from weakened demand in Asia Pacific and Europe. Operating earnings declined to $47 million for first quarter 2014 compared with $49 million for first quarter 2013, primarily due to lower selling prices partially offset by lower operating costs and higher sales volume.
Advanced Materials - Sales revenue was relatively unchanged as higher sales volume for Eastman Tritan(TM) copolyester and premium acoustic interlayers was offset by lower performance films sales volume which was expected due to changes in customer incentive terms in Asia Pacific. Excluding non-core or non-recurring items in first quarter 2014, operating earnings increased to $71 million for first quarter 2014 compared with $65 million for first quarter 2013, primarily due to lower unit costs for specialty plastics. The lower unit costs were due to higher capacity utilization resulting from previous inventory management decisions and to meet demand for Eastman Tritan(TM) copolyester.
Fibers - Sales revenue increased due to higher selling prices, partially offset by lower sales volume. Lower acetate tow sales volume, primarily due to the combination of customer buying patterns and additional industry capacity, including Eastman's China acetate tow joint venture, was partially offset by acetate flake sales volume to the joint venture. Operating earnings increased to $117 million for first quarter 2014 compared with $114 million for first quarter 2013, primarily due to higher selling prices and sales of acetate flake to the joint venture more than offsetting lower acetate tow sales volume.
Specialty Fluids & Intermediates - Sales revenue decreased primarily due to lower sales volume for specialty fluids and other intermediates, partially offset by higher selling prices. Lower sales volume for specialty fluids was primarily due to the timing of customer project completions. Higher selling prices were primarily due to increased sales of higher priced specialty fluids and higher raw material and energy costs. Operating earnings decreased to $64 million for first quarter 2014 compared to $95 million for first quarter 2013 primarily due to higher raw material and energy costs, particularly for propane, lower sales volume for specialty fluids, and costs of a weather-related outage at the Longview, Texas facility.
Cash Flow
Eastman used $30 million in cash from operating activities during first quarter 2014 primarily due to a seasonal increase in working capital, mostly receivables and inventory. Share repurchases totaled $260 million during first quarter 2014.
Outlook
Commenting on the outlook for full year 2014, Costa said, "Our solid first-quarter earnings are a good start to the year. Looking forward, we expect sales revenue growth in the remaining three quarters and for full-year sales revenue to be consistent with global GDP growth. We also expect that benefits from Eastman-specific actions and from balanced deployment of our strong cash flow will accelerate earnings growth for the remainder of the year. Given the strength of our differentiated portfolio of businesses, we continue to expect 2014 earnings per share to be between $6.70 and $7.00." Non-core and non-recurring items are excluded from the earnings per share projection.
The earnings for 2013, 2012, 2011, 2010, and 2009 referenced in the second paragraph of this release are non-GAAP and exclude the non-core or non-recurring items detailed, with reconciliation to GAAP earnings, in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" section of the company's Annual Reports on Form 10-K for 2013, 2012, and 2011.
Eastman will host a conference call with industry analysts on April 25, 2014 at 8:00 a.m. ET. To listen to the live webcast of the conference call and view the accompanying slides, go to www.investors.eastman.com, Events & Presentations. To listen via telephone, the dial-in number is +1-913-312-0690, passcode number 1629560. A web replay, a replay in downloadable MP3 format, and the accompanying slides will be available at www.investors.eastman.com, Events & Presentations. A telephone replay will be available continuously from 11:00 a.m. ET, April 25, to 11:00 a.m. ET, May 5, at +1-888-203-1112 or +1-719-457-0820, passcode 1629560.
Forward-Looking Statements: This news release includes forward-looking statements concerning current expectations for future global economic conditions; company manufacturing capacity additions, mix of products sold, and capital expenditures, acquisitions, debt, dividends, and stock repurchases; non-core or non-recurring costs, charges, income, and gains; company and segment revenue and earnings; and cash flow for full year 2014. Such expectations are based upon certain preliminary information, internal estimates, and management assumptions, expectations, and plans, and are subject to a number of risks and uncertainties inherent in projecting future conditions, events, and results. Actual results could differ materially from expectations expressed in the forward-looking statements if one or more of the underlying assumptions or expectations prove to be inaccurate or are unrealized. Important factors that could cause actual results to differ materially from such expectations are and will be detailed in the company's filings with the Securities and Exchange Commission, including the Form 10-K filed for 2013 available, and the Form 10-Q to be filed for first quarter 2014 and to be available, on the Eastman web site at www.eastman.com in the Investors, SEC filings section.
Eastman is a global specialty chemical company that produces a broad range of products found in items people use every day. With a portfolio of specialty businesses, Eastman works with customers to deliver innovative products and solutions while maintaining a commitment to safety and sustainability. Its market-driven approaches take advantage of world-class technology platforms and leading positions in attractive end-markets such as transportation, building and construction and consumables. Eastman focuses on creating consistent, superior value for all stakeholders. As a globally diverse company, Eastman serves customers in approximately 100 countries and had 2013 revenues of approximately $9.4 billion. The company is headquartered in Kingsport, Tennessee, USA and employs approximately 14,000 people around the world. For more information, visit www.eastman.com.
Contacts:
Media: Tracy Kilgore
+1-423-224-0498 / tjkilgore@eastman.com
Investors: Greg Riddle
+1-212-835-1620 / griddle@eastman.com
Q1 2014 Financial Tables: http://hugin.info/150386/R/1779888/608355.pdf
This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Eastman Chemical Company via Globenewswire
Topic: Earnings
Source: Eastman Chemical Company
http://www.acnnewswire.com
From the Asia Corporate News Network
Copyright © 2024 ACN Newswire. All rights reserved. A division of Asia Corporate News Network.
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