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Kingsport, Tenn., USA, July 28, 2015 - (ACN Newswire) - Eastman Chemical Company (NYSE:EMN) today announced earnings, excluding non-core items, of $2.01 per diluted share for second quarter 2015 versus $1.92 per diluted share for second quarter 2014. Reported earnings were $1.98 per diluted share for second quarter 2015 versus $1.92 per diluted share for second quarter 2014. For detail of the excluded items and reconciliation to reported company and segment earnings, see Tables 3A and 4.
"Our record results in second quarter and strong performance in the first half of the year demonstrate the quality of our robust specialty portfolio, the value of our acquisitions, and most importantly our ability to focus on execution and deliver results," said Mark Costa, chairman and CEO. "We remain confident we will deliver our sixth consecutive year of solid earnings growth in 2015." See "Outlook" for the items excluded from annual earnings comparisons.
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(In millions, except per share amounts) 2Q2015 2Q2014
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Sales revenue $2,533 $2,460
Earnings per diluted share $1.98 $1.92
Earnings per diluted share excluding
non-core items* $2.01 $1.92
Net cash provided by operating activities $591 $419
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*For reconciliation to reported company and segment earnings, see Tables 3A and 4.
Corporate Results 2Q 2015 versus 2Q 2014
Sales revenue for second quarter 2015 was $2.5 billion, a 3 percent increase compared with second quarter 2014, primarily due to sales revenue from the Taminco Corporation, Commonwealth Laminating & Coating Inc., and aviation turbine oil businesses acquired in 2014. This was partially offset by lower selling prices, particularly in the Specialty Fluids & Intermediates segment, lower Fibers segment sales volume, and an unfavorable shift in foreign currency exchange rates. Excluding the items described in Tables 3A and 4, second-quarter 2015 operating earnings were $480 million compared with $441 million for second quarter 2014. The increase was primarily due to Advanced Materials segment earnings growth, earnings from acquired businesses, and improved spread as lower raw material and energy costs exceeded lower selling prices. These items were partially offset by propane hedges, lower Fibers segment sales volume, and an unfavorable shift in foreign currency exchange rates. Reported second-quarter 2015 operating earnings were $469 million compared with $436 million for second quarter 2014.
Segment Results 2Q 2015 versus 2Q 2014
Additives & Functional Products - Sales revenue increased primarily due to sales of products of the acquired Taminco specialty amines and crop protection businesses, and higher coatings products sales volume attributed to demand in key end-markets. These items were partially offset by lower coatings and other formulated products selling prices due to lower raw material and energy costs and an unfavorable shift in foreign currency exchange rates. Excluding non-core items in second quarter 2014, operating earnings increased to $119 million for second quarter 2015 compared with $103 million for second quarter 2014 primarily due to earnings from acquired businesses.
Adhesives & Plasticizers - Sales revenue decreased primarily due to lower plasticizers selling prices and an unfavorable shift in foreign currency exchange rates. Lower plasticizers selling prices were primarily in response to lower raw material and energy costs and continued competitive pressure. Operating earnings increased to $63 million for second quarter 2015 compared with $56 million for second quarter 2014 primarily due to lower raw material and energy costs and slightly higher adhesives resins selling prices attributed to demand in packaging and hygiene markets. These items were partially offset by lower plasticizers selling prices, an unfavorable shift in foreign currency exchange rates, and the negative impact of propane hedges.
Advanced Materials - Sales revenue increased due to higher sales volume across the segment and sales of products of the acquired Commonwealth performance films business, partially 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. Operating earnings increased to $135 million for second quarter 2015 compared with $80 million for second quarter 2014 primarily due to higher sales volume and improved product mix especially of Eastman Tritan(TM) copolyester and interlayers with acoustic properties. Operating earnings also benefited from earnings from the acquired business.
Fibers - Sales revenue decreased primarily due to lower acetate tow and acetyl chemical sales volume attributed to customer inventory destocking. Excluding non-core items in second quarter 2015, operating earnings decreased to $91 million for second quarter 2015 compared with $123 million for second quarter 2014 primarily due to lower acetate tow sales volume.
Specialty Fluids & Intermediates - Sales revenue increased primarily due to sales of products of the acquired Taminco functional amines and aviation turbine oil businesses, mostly offset by lower selling prices for olefin-based intermediates. The lower selling prices were primarily in response to lower raw material and energy costs. Excluding non-core items in second quarter 2014, operating earnings decreased to $83 million for second quarter 2015 compared to $96 million for second quarter 2014, primarily due to earnings from acquired businesses being more than offset by the negative impact of propane hedges.
Cash Flow
Eastman generated $591 million in cash from operating activities during second quarter 2015 primarily due to strong net earnings. Priorities for uses of available cash include payment of the quarterly dividend, repayment of debt, and funding targeted growth initiatives. Net debt, defined as borrowings minus cash and cash equivalents, declined by $393 million during the second quarter.
Outlook
Commenting on the outlook for full year 2015, Costa said: "Our earnings outlook for the year has improved due to our record second quarter earnings and our strong first half of the year. These results reflect excellent performance of our specialty businesses, including strong volume growth and product mix improvement, and we expect this momentum to continue into the second half of the year. We also face challenges in the second half of the year from the global economic slowdown, volatile raw material and energy prices, and the strengthening U.S. dollar. Despite these challenges, we remain confident we will deliver a sixth consecutive year of solid earnings growth and continued strong cash flow." 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 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 July 28, 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 913-312-0934, passcode number 1077297. 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, July 28, to 11:00 a.m. ET, August 7, at 888-203-1112 or 719-457-0820, passcode 1077297.
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 prices and 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-Q filed for first quarter 2015 available, and the Form 10-Q to be filed for second 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
Second Quarter 2015 Financial Tables: http://hugin.info/150386/R/1941456/701848.pdf
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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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