Ciba Q1 EBIT below analyst forecasts; shares fall

03 May 2007 13:03  [Source: ICIS news]

MUMBAI (ICIS news)--Ciba Specialty Chemicals’s first quarter earnings before interest and tax (EBIT) fell below UBS and Citigroup forecasts due to continued weakness in its water and paper treatment division, leading to a 2.3% share fall.

 

The Swiss company’s EBIT came in at Swiss francs (Swfr) 134m ($111m/€81m), 7% below UBS estimates and 6% lower than Citigroup’s forecast.

 

UBS’s rating for Ciba remained unchanged at Reduce 2 because of the company’s disappointing fourth quarter results.

 

Citigroup maintained its Sell rating on Ciba on concerns surrounding structural challenges within the paper business which could prevent substantial profit recovery.

 

UBS expected the company to achieve an increase in EBIT margin by 100 basis points, before restructuring charges, in 2007.

 

Citigroup said it remained reasonably confident despite underwhelming results as Ciba expected to progress on cost-cutting. 

 

Ciba shares were down 2.3% at Swfr77.60 on the Swiss stock exchange at 12:58 hours local time (10:58 GMT).

 

($1 = Swfr 1.21/€1 = Swfr 1.65)

By: Aarti Kapoor
+65 6780 4359

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