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Koppers stock up on Q3 earnings and revenue beat

November 26/2020

MOSCOW (MRC) -- Koppers Holdings Inc.Тs KOP shares rose after the company came up with its third-quarter 2020 results, wherein both earnings and revenues surpassed the respective Zacks Consensus Estimate and also grew on a year-over-year basis, reported YahooFinance.

The Pennsylvania-based company also raised its earnings outlook for 2020. Its shares popped 5.8% last Thursday on forecast-topping results and upbeat earnings outlook.

Koppers logged profits (attributable to the company) of USD75.6 million or USD3.53 per share for the third quarter, up from a profit of US19.9 million or 94 cents a year ago.

Barring one-time items, earnings were USD1.64 per share for the quarter, up from USD1.16 per share a year ago. Earnings topped the Zacks Consensus Estimate of USD1.29.

Koppers recorded revenues of USD437.5 million for the quarter, up 0.8% year over year. It also surpassed the Zacks Consensus Estimate of USD425.8 million. Sales were driven by favorable impacts of currency swings.

Sales from the Railroad and Utility Products and Services segment went down around 4% year over year to USD191 million in the reported quarter. The decline was due to decreased volumes in the commercial crosstie market, offset by improved demand for utility poles in Australia and crosstie disposal services in the United States.

The Performance Chemicals unit recorded sales of US147.9 million in the quarter, up around 19% year over year. Sales were driven by sustained demand for copper-based preservatives in the United States and pent-up demand in international markets.

Sales from the Carbon Materials and Chemicals division fell around 12% year over year to USD98.6 million. Sales were impacted by reduced prices for carbon pitch and phthalic anhydride and lower demand for carbon black feedstock globally.

Koppers ended the quarter with cash and cash equivalents of USD39.5 million, down around 3% year over year. Long-term debt was USD796.1 million, down around 16% year over year.

Koppers envisions sales for 2020 to be roughly USD1.6 billion. The company also expects adjusted EBITDA to be in the band of USD204-USD210 million for the year, higher than its earlier view of USD196-USD204 million. Moreover, Koppers sees adjusted earnings per share for 2020 in the band of USD3.65-USD3.90, also up from its prior expectation of USD3.25-USD3.50.

The company also expects investments of $55-$60 million in capital expenditures this year, mainly associated with improving safety and reliability of its existing infrastructure. It also plans to cut debt by around USD125 million in 2020.

As MRC reported earlier, Koppers has restarted its phthalic anhydride (PA) unit following a maintenance turnaround. The company resumed operations at the unit on October 10, 2019. The unit remained under maintenance for about 40 days. Located in Stickney, Illinois, USA, the unit has a production capacity of 100,000 mt/year.

Phthalic anhydride is widely used in for the production of paints and varnishes and plasticizers for PVC products. In a small amount it is used in the manufacture of rubber products, tires. In addition, it is used in the light, pharmaceutical and electrical industries.

According to MRC's DataScope report, imports of suspension polyvinyl chloride (SPVC) into Russia totalled 38,500 tonnes in the first ten months of 2020, down by 16% year on year. At the same time, exports decrease by 1%.
Author:Margaret Volkova
Tags:PVC, ftaleviy angidrid, SPVC, petrochemistry, Koppers, Russia, USA.
Category:General News
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