Eastman Chemical earnings drop 22% in Q2

MOSCOW (MRC) -- Eastman Chemical Company announced reported earnings of USD1.71 per diluted share for second quarter 2016 versus USD1.98 per diluted share for second quarter 2015, said the company on its site.

Earnings excluding non-core items were USD1.68 per diluted share for second quarter 2016 versus USD2.01 per diluted share for second quarter 2015.

Eastman generated USD494 million in cash from operating activities during second quarter 2016 primarily due to strong net earnings. In addition, the company sold 1.5% notes due 2023 in the principal amount of EUR550 million (USD614 million), with net proceeds used to repay USD500 million of the USD1 billion 2.4% notes due June 2017 and other borrowings. Priorities for uses of available cash include payment of the quarterly dividend, repayment of debt, funding targeted growth initiatives, and repurchasing shares. Total borrowings decreased USD274 million, and net debt, defined as total borrowings minus cash and cash equivalents, declined by USD312 million during the second quarter.

Commenting on the outlook for full-year 2016, Costa said: "During the first half of the year, we delivered strong growth of high value, innovative specialty products and we expect that to continue. We are also benefitting from the actions we have taken to accelerate our innovation and market development activities and to significantly increase our cost reduction efforts. However, the challenges we face have intensified including increasing competitive pressures particularly from the Asia Pacific region and compressing olefin spreads. As a result, we expect a decline in adjusted 2016 earnings per share that approaches 10 percent below adjusted 2015 earnings per share compared with our previous expectation of a decline of approximately 5 percent."

As MRC informed earlier, Eastman Chemical is seeking options to off-load its excess ethylene excess ethylene and other olefin intermediates in the US. Eastman has four crackers in Longview, Texas, which are able to produce ethylene and propylene. The company is seeking to monetize its excess ethylene as well as olefin intermediates, according to Eastman CEO Mark Costa.

Eastman (headquartered in Kingsport, Tennessee, USA) 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 is a global specialty chemicals company with 15,000 employees worldwide.
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MOSCOW (MRC) -- The Sumitomo Chemical Group reported a 64% decrease in its first-quarter net profit to yen (Y) 12.2bn from the previous year, said the company on its site.

Sales decreased by Yen100.0 billion compared with the same period of the previous fiscal year, to Yen456.6 billion.

The Group posted operating income of Yen25.3 billion, ordinary income of Yen25.8 billion and net income attributable to owners of the parent of Yen12.2 billion, all representing year-on-year decreases.

The Sumitomo Chemical Group’s financial results by business segment for the first quarter ended June 30, 2016 were as follows.

Market prices of petrochemical products and synthetic resins declined because of lower feedstock prices. Shipments of petrochemical products decreased due to the restructuring of the petrochemical business at the Chiba Works. The stronger yen had a negative effect on sales from overseas subsidiaries in yen terms. As a result, the segment’s sales decreased by Yen61.5 billion compared with the same period of the previous fiscal year, to Yen137.0 billion. Operating income declined by Yen5.2 billion, to Yen1.8 billion.

As MRC informed earlier, Sumitomo Chemical and Sekisui Chemical (Tokyo) in March 2016 combined their respective polyolefin films business under a new joint venture.

Sumitomo Chemical is a Japanese based manufacturer of a diverse range of products, including basic chemicals, petrochemicals and plastics, fine chemicals, agricultural chemicals, IT-related chemicals and pharmaceuticals.
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MOSCOW (MRC) -- The chemicals company Solvay said for the second quarter of 2016, net income, Solvay share, on an IFRS basis was 185 million euros (USD203.1 million) compared with EUR138 million in 2015, as per the company's report.

On an underlying basis, net income, Solvay share, rose 4% to EUR223 million, with the higher operating profit more than offsetting the end of contributions from the discontinued European chlorovinyls activities, the company said.

Solvay however said net sales during the period fell 6% to EUR2.95 billion, as a result of a 4% drop net impact of foreign exchange fluctuations on conversion and a 2% price decrease in a context of lower raw material and energy costs.

"Solvay delivered strong results in the second quarter, with underlying Ebitda up 8% despite continued headwinds in some markets. This reflects the strength and breadth of the portfolio and the continued momentum of our excellence programs," CEO Jean-Pierre Clamadieu said.

Underlying earnings before interest taxes, depreciation and amortization or Ebitda during the period was EUR652 million.

Based on current market conditions, Solvay reaffirmed its full year 2016 guidance of high single-digit underlying Ebitda growth and free cash flow in excess of EUR650 million.

As MRC wrote before, in early June 2016, Solvay completed the purchase of Eastman Chemical Company's share in their former US joint venture Primester. As the sole owner of the cellulose acetate flake plant, Solvay had secured the most economical long term supply for its own tow businesses while adapting capacity to demand. Eastman will provide the long-term supply of basic utilities and raw materials to the Kingsport, Tennessee-based plant.

Solvay S.A. is a Belgian chemical company founded in 1863, with its head office in Neder-Over-Heembeek, Brussels, Belgium. The company has diversified into two major sectors of activity: chemicals and plastics. Solvay supplies over 1500 products across 35 brands of high-performance polymers - fluoropolymers, fluoroelastomers, fluorinated fluids, semi-aromatic polyamides, sulfone polymers, aromatic ultra polymers, high-barrier polymers and cross-linked high-performance compounds.
MRC

MOSCOW (MRC) -- ExxonMobil reported its quarterly profit fell nearly 60 percent from a year ago as commodity prices remained low and its refining margins were weak, said Cnbc.

The world's largest publicly traded integrated oil company earned an adjusted 41 cents per share in the second quarter, compared with USD1 per share, in the year ago period.

Analysts polled by Thomson Reuters had expected earnings per share of 64 cents. The stock was lower in premarket trading.

"While our financial results reflect a volatile industry environment, ExxonMobil remains focused on business fundamentals, cost discipline and advancing selective new investments across the value chain to extend our competitive advantage," CEO Rex Tillerson said in a statement.

Revenues were USD57.694 billion, versus USD74.11 billion in the second quarter of 2015.

ExxonMobil left its quarterly dividend unchanged at 75 cents per share ahead of earnings on Wednesday. The company hasn't raised its dividend since the second quarter of 2014.
MRC

МОSCOW (MRC) -- Chemtura Corporation announced financial results for the second quarter ended June 30,
2016, said the company on its site.

The Company also filed with the Securities and Exchange Commission its Quarterly Report on Form 10-Q for the
quarter ended June 30, 2016. For the second quarter of 2016, Chemtura reported net sales of USD441 million and net earnings from continuing operations on a GAAP basis of USD34 million, or USD0.53 per diluted share. Net earnings from continuing operations on a Non-GAAP basis were USD26 million, or USD0.40 per diluted share.

The year-over-year reduction in net sales primarily reflected lower sales prices in the current period that are the result of passing along the benefit of lower raw material costs to certain of our customers. Additionally, sales volume for our urethane products used in mining and oil and gas applications declined due to continued soft demand conditions in those markets. Sequentially, sales volume grew modestly as petroleum additives sales of inhibitor and detergents increased offset by lower sales volume for certain synthetic lubricant basestocks and intermediates as well as the lower urethane products sales volumes.

Operating income year-over-year benefited from the net change in sales prices compared to the change in raw material costs ("price-over-raw-materials") and lower distribution costs and inventory adjustments. However, these gains were offset by the lower volume of our urethane products coupled with the $2 million charge associated with the state excise tax matter in the second quarter of 2016. Sequentially, we also benefited from favorable price-over-raw-materials and lower distribution costs, but this was offset by unfavorable product mix and the settlement of the state excise tax matter.

Additionally, in the first quarter of 2016, we recognized income on a technology license of approximately $2 million, which did not repeat in the second quarter.

As MRC informed earlier, Chemtura has announced that Azelis Americas (formerly Koda Distribution Group) will be the sole distributor for its pre-polymer urethanes, curatives, and polyester polyols product lines in North America. The agreement will be effective from 26 July 2016, in addition to the current urethanes surface coatings portfolio. At the same date, Chemtura will be discontinuing its relationship with AdipreneDirect in North America. Azelis Americas with headquarters in Stamford, CT, USA, is part of the Azelis Group, which is based in Luxembourg.

Chemtura, with 2015 sales of USD 1.7 billion, is a global manufacturer and marketer of speciality chemicals headquartered in Philadelphia, Pennsylvania, with its other principal executive office in Middlebury, Connecticut. The company focuses on specialty chemicals for various industrial sectors, and these are transportation (including automotive), energy, and electronics.

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