Specialty materials company
) reported third-quarter 2012 adjusted earnings (excluding
one-time items) of 93 cents per share, exceeding the Zacks
Consensus Estimate of 91 cents but trailing the year-ago earnings
of $1.27 per share.
Earnings (as reported) from continuing operation was down
29.5% year over year to 74 cents a share in the quarter from
$1.05 a year ago. Lower pricing for some specialty chemical
products due to soft economic conditions in Europe and Asia hurt
the company's bottom line in the quarter.
Revenues and Margins
Sales for the quarter were $1,609 million, down 11% year over
year, missing the Zacks Consensus Estimate of $1,717 million. The
decline was due to lower pricing in the company's acetyl
intermediates and Industrial Specialties businesses, and
unfavorable currency impacts.
Advanced Engineered Materials:
Sales decreased 3% year over year to $322 million in the third
quarter, due to unfavorable currency translation. Prices rose 3%
and strong volumes across America and Asia were offset by weak
European demand across most of the company's product lines.
Operating EBITDA was down 2.7% to $109 million due to lower
equity earnings and currency impacts, offsetting higher
Sales rose 5.1% year over year to $314 million, driven by a 6%
increase in prices due to strong global demand and also reflects
the strong value added applications that the segment provides to
its customers. Operating EBITDA rose 11.5% to $87 million.
Net sales decreased 10.5% from the year ago quarter to $297
million. Volumes increased 2% based on increased demand in North
America and Asia, offset by lower European volumes. Pricing was
also lower in the quarter due to soft demand in Ethylene Vinyl
Acetate (EVA) applications and lower raw material costs. Weaker
euro also negatively impacted the results. Operating EBITDA
declined 16.3% to $36 million as record results in Emulsions were
more than offset by lower demand for EVA applications.
The segment witnessed a 19.5% decline in sales to $785 million,
due to lower acetyl pricing and demand and negative currency
impacts. The segment was impacted by weak economic conditions in
Europe and Asia, which affected demand and pricing. Operating
EBITDA decreased 45.8% to $91 million due to lower pricing.
Cash and cash equivalents were $928 million as of September
30, 2012, versus $682 million as of December 31, 2011. The
company's long-term debt stood at $2,839 million as of September
30, 2012, compared with $2,873 million as of December 31,
Celanese expects the challenging economic conditions to
persist in 2013 but still anticipates fourth-quarter 2012
adjusted earnings to be modestly higher on a year-over-year
basis. For 2013, it expects earnings growth to be driven by the
company-specific initiatives and be consistent with its long-term
growth objectives of 12% to 14%.
Celanese, which competes with
), currently retains a Zacks #5 Rank, reflecting a short-term (1
to 3 months) Strong Sell rating. We have a long-term (more than 6
months) Neutral recommendation on the stock.
BASF SE (BASFY): Free Stock Analysis Report
CELANESE CP-A (CE): Free Stock Analysis
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