MOSCOW (MRC) -- Ecolab reported third-quarter net income down 44% year on year (YOY), to USD246.2 million, on net sales down 6%, to USD3.02 billion. Adjusted earnings totaled USD1.15/share, down 24% YOY but slightly ahead of analysts’ consensus estimate of USD1.13/share, as reported by Refinitiv (New York, New York), said Chemweek.
Volumes declined due to COVID-19 and a less-favorable business mix more than offset cost cuts and higher selling prices. “Third-quarter sales and earnings showed significant improvement from the COVID-19-related lows in the second quarter, principally led by our institutional division, as recovering customer trends along with our new business wins, better customer penetration, and cost efficiency actions drove improved sequential results,” says Ecolab chairman and CEO Douglas Baker. “We expect the improvement to continue in our fourth quarter, though likely at a slower rate as the second COVID-19 wave impacts reopenings."
Global industrial segment sales fell 3% YOY, to USD1.47 billion, while segment operating income was up 18%, to USD293.4 million. Sales were flat in the food and beverage business, but this was offset by declines in other industrial end markets. Higher selling prices, cost cuts, and lower discretionary spending boosted operating income, however.
Global institutional and specialty segment sales were down 22% YOY, to USD896.1 million, while segment operating income fell 71%, to USD82.0 million. Closures and reduced business for restaurants, lodging, and entertainment facilities cut into demand for the segment, more than offsetting higher demand for sanitizing products.
Global healthcare and life sciences segment sales were up 33% YOY, to USD321.5 million, while segment operating income increased 84%, to USD65.7 million. The COVID-19 pandemic led to strong volume gains across the segment.
Other segment sales declined 12% YOY, to USD283.7 million, while segment operating income was down 13%, to USD44.7 million. Lower volumes more than offset cost saving and lower discretionary spending.
As MRC informed earlier, European Commission has recently presented its 2030 climate target plan, in which it sets out a program to reduce EU greenhouse gas (GHG) emissions by at least 55% by 2030, compared with 1990, despite a call from the European Parliament in September for GHG emissions to be reduced 60% by 2030. The raised target puts the EU on a balanced pathway to reaching climate neutrality by 2050 and underlines the EU's continued global leadership in this area, ahead of the next UN climate conference (COP26).
As MRC informed earlier, in October, 2020, the European Commission adopted the EU's chemicals strategy for sustainability, describing it as the first step towards a zero-pollution ambition for a toxic-free environment announced in the European Green Deal.
We remind that Russia's output of chemical products rose in September 2020 by 6.7% year on year. At the same time, production of basic chemicals increased by 6.1% year on year in the first nine months of 2020, according to Rosstat's data. According to the Federal State Statistics Service of the Russian Federation, polymers in primary form accounted for the greatest increase in the January-September output. Last month's production of primary polymers decreased to 852,000 tonnes from 888,000 tonnes in August due to shutdowns in Tomsk, Ufa and Kazan. Overall output of polymers in primary form totalled 7,480,000 tonnes over the stated period, up by 16.4% year on year.
MRC