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KINGSPORT, Tenn., May 1, 2015 - (ACN Newswire) - Eastman Chemical Company (NYSE:EMN) today announced earnings, excluding non-core or non-recurring items, of $1.84 per diluted share for first quarter 2015 versus $1.61 per diluted share for first quarter 2014. Reported earnings were $1.14 per diluted share for first quarter 2015 versus $1.52 per diluted share for first quarter 2014. For detail of the excluded items and reconciliation to reported company and segment earnings, see Tables 3 and 4.
"We're off to a strong start to the year with excellent first-quarter earnings, demonstrating our focus on execution in difficult business conditions," said Mark Costa, chairman and CEO. "We've done a good job of improving operating margins, reflecting the more specialty nature of our portfolio and our continued discipline in managing costs. With our first-quarter results, we are well positioned to deliver our sixth consecutive year of earnings growth in 2015." See the second paragraph under "Outlook" for the items excluded from annual earnings comparisons.
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(In millions, except per share amounts) 1Q2015 1Q2014
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Sales revenue $2,443 $2,305
Earnings per diluted share $1.14 $1.52
Earnings per diluted share excluding
non-core or non-recurring items* $1.84 $1.61
Net cash provided by (used in) operating activities $91 ($30)
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* For reconciliation to reported company and segment earnings, see Tables 3 and 4.
Corporate Results 1Q 2015 versus 1Q 2014
Sales revenue for first quarter 2015 was $2.4 billion, a 6 percent increase compared with first quarter 2014, primarily due to sales revenue from the Taminco Corporation, Commonwealth Laminating & Coating Inc., and aviation turbine oil businesses acquired in 2014 partially offset by lower selling prices primarily due to lower raw material and energy costs. Excluding the items described in Tables 3 and 4, first-quarter 2015 operating earnings were $435 million compared with $383 million for first quarter 2014. The increase was primarily due to both improved spread, as lower raw material and energy costs exceeded lower selling prices, and earnings from acquired businesses. These were partially offset by lower earnings in the Fibers segment, an unfavorable shift in foreign currency exchange rates, and the negative impact of propane hedges. Reported first-quarter 2015 operating earnings were $311 million compared with $361 million for first quarter 2014.
Segment Results 1Q 2015 versus 1Q 2014
Additives & Functional Products - Sales revenue increased primarily due to sales of products of the acquired Taminco specialty amines and crop protection businesses partially offset by lower selling prices due to lower raw material and energy costs. Operating earnings increased to $120 million for first quarter 2015 compared with $94 million for first quarter 2014 primarily due to earnings from acquired businesses and improved spread as lower raw material and energy costs exceeded lower selling prices, partially offset by an unfavorable shift in foreign currency exchange rates and the negative impact of propane hedges.
Adhesives & Plasticizers - Sales revenue decreased primarily due to an unfavorable shift in foreign currency exchange rates and lower plasticizers selling prices. Lower plasticizers selling prices were primarily in response to lower raw material and energy costs and continued competitive pressure. Operating earnings increased to $53 million for first quarter 2015 compared with $47 million for first quarter 2014 due to adhesives resins products earnings. This increase resulted from slightly higher adhesives resins selling prices attributed to solid demand in packaging and hygiene markets and constrained industry supply due to limited raw material availability, and lower raw material and energy costs, partially offset by an unfavorable shift in foreign currency exchange rates.
Advanced Materials - Sales revenue decreased as sales of products of the acquired Commonwealth Laminating & Coating performance films business were more than offset by an unfavorable shift in foreign currency exchange rates and lower selling prices primarily for copolyesters due to lower raw material and energy costs. Excluding non-core or non-recurring items in both periods, operating earnings increased to $75 million for first quarter 2015 compared with $71 million for first quarter 2014 primarily due to earnings from the acquired business.
Fibers - Sales revenue decreased primarily due to lower acetate tow and acetyl intermediates sales volume attributed to customer inventory destocking. Excluding costs of the shutdown of the Workington, UK acetate tow manufacturing site in first quarter 2015, operating earnings decreased to $90 million for first quarter 2015 compared with $117 million for first quarter 2014 due to lower acetate tow sales volume and related lower capacity utilization resulting in higher unit costs partially offset by lower raw material and energy costs.
Specialty Fluids & Intermediates - Sales revenue increased primarily due to sales of products of the acquired Taminco functional amines and aviation turbine oil businesses and higher intermediates sales volume, partially offset by lower selling prices for olefin-based intermediates. The lower olefin-based intermediates selling prices were primarily in response to lower raw material and energy costs. Operating earnings increased to $102 million for first quarter 2015 compared to $64 million for first quarter 2014 due to both improved spread as lower raw material and energy costs exceeded lower selling prices and earnings from the acquired businesses, partially offset by the negative impact of propane hedges.
Cash Flow
Eastman generated $91 million in cash flows from operating activities during first quarter 2015. Strong earnings were partially offset by a seasonal increase in working capital. The first-quarter working capital increase was lower than usual primarily due to the impact on inventories of the recent decline in raw material and energy costs.
Outlook
Commenting on the outlook for full year 2015, Costa said: "Our outlook since January has improved as our first quarter year over year earnings growth demonstrates that we are benefitting from strong leadership positions in key markets, the diversity of end-markets and geographies we serve, and improved product mix from market adoption of our specialty products. We face increasing challenges including global economic uncertainty, the strengthening U.S. dollar, and the impact of volatile oil prices. Given our strong start to the year, expectations for solid volume growth in our specialty businesses and continued strong results from recent acquisitions, as well as our discipline in managing costs, we are now well positioned for our sixth consecutive year of EPS growth. We also continue to expect strong cash flow generation." Non-core and non-recurring items are excluded from the earnings per share projection.
The earnings for 2014, 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" sections of the company's Annual Reports on Form 10-K for 2014, 2013, 2012, and 2011.
Eastman will host a conference call with industry analysts on May 1, 2015 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 913-312-1295, passcode number 6673127. 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, May 1, to 11:00 a.m. ET, May 11, at 888-203-1112 or 719-457-0820, passcode 6673127.
Forward-Looking Statements
This news release includes forward-looking statements concerning current expectations for future global economic conditions; competitive position and acceptance of specialty products in key markets; mix of products sold; foreign currency exchange rates; raw material and energy costs, including crude oil prices, and other costs; non-core or non-recurring costs, charges, income, and gains; revenue and earnings from acquired businesses; and revenue, earnings, and cash flow for full year 2015. 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 2014 available, and the Form 10-Q to be filed for first quarter 2015 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 2014 revenues of approximately $9.5 billion. The company is headquartered in Kingsport, Tennessee, USA and employs approximately 15,000 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
1Q 2015 Financial Tables: http://hugin.info/150386/R/1917871/686202.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: Press release summary
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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