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Univar's (UNVR) Q1 Earnings Trail Estimates, Revenues Top

UnivarUNVR logged a profit (on a reported basis) of $22.6 million or 16 cents per share in first-quarter 2017, up around 61% from a profit of $14 million or 10 cents per share a year ago.

Barring one-time items, earnings came in at 19 cents per share in the quarter, missing the Zacks Consensus Estimate of 22 cents.

The chemical maker's revenues were essentially flat year over year at $1,998.8 million in the reported quarter as lower volumes were offset by increased selling prices. Sales beat the Zacks Consensus Estimate of $1,933 million.

Gross profit rose around 2% year over year to $439.4 million in the quarter on the back of the company's margin management actions and favorable product and market mix.

Univar Inc. Price, Consensus and EPS Surprise

Univar Inc. Price, Consensus and EPS Surprise | Univar Inc. Quote

Segment Review

Revenues from the USA division fell around 3% year over year to $1.2 billion in the reported quarter, affected by reduced volumes that more than offset improved pricing. Gross profit was flat year over year at $262.9 million.

Revenues from the Canada segment went up around 13% to $307.3 million, driven by increased sales in the Western Canada oil and gas market. Gross profit rose roughly 10% to $55.8 million on higher sales.

The EMEA segment raked in sales of $439.7 million, up 0.5%, helped by higher selling prices. Gross profit rose around 6% to $101.8 million, supported by favorable market mix.

Sales from the Rest of World unit fell 0.5% to $100.9 million as softer demand in Mexico and sluggish economic conditions in Brazil more the offset higher pricing. Gross profit fell around 8% to $18.9 million, hurt by weak economic conditions in Mexico.

Balance Sheet

Univar ended the quarter with cash and cash equivalents of $300.6 million, up around 35% year over year. Long-term debt was $2,905.7 million, down around 6% year over year.

Outlook

Univar said that it will remain focused on executing its growth and productivity plans. The company sees mid-single digit growth in adjusted EBITDA in the first half of 2017 and expects to deliver mid-to-high single digit growth in adjusted EBITDA for the full year.

For second-quarter 2017, Univar expects adjusted EBITDA growth of mid-single digits from previous year's second quarter figure of $148.2 million.

Price Performance

Univar has significantly outperformed the Zacks categorized Chemicals-Diversified industry over a year. The company's shares have gained 77% over this period compared with the industry's gain of 19.3% over the same period.

Zacks Rank & Key Picks

Univar is a Zacks Rank #2 (Buy) stock.

Other well-placed companies in the chemical space include The Chemours Company CC , Huntsman Corporation HUN and Kronos Worldwide, Inc. KRO , all holding a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Chemours has an expected long-term growth of 15.5%.

Huntsman has an expected long-term growth of 7.8%.

Kronos has an expected long-term growth of 5%.

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Univar Inc. (UNVR): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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