Ashland's Q3 profits drop 7% on construction slump

29 October 2007 14:12  [Source: ICIS news]

LONDON (ICIS news)--Ashland's third quarter operating income fell 7% to $26m (€18m) after being hit by the downturn in the US construction market, it said on Monday. 

 

The company's third quarter revenues increased by 9% compared to the year-earlier period at $2.09bn.

“Weak conditions in the North American building and construction markets and a difficult environment in the transportation markets have challenged Ashland Performance Materials and Ashland Distribution all year and especially in the fourth quarter,” said CEO James O’Brien.

Ashland’s Valvoline automotive fluids and lubricants business was the largest contributor the company’s earnings. It achieved an operating income of $17.9m, up from a $14.6m loss a year earlier.

 

The growth in international and branded lubricant volumes offset a decline in Valvoline’s lower-margin private-label business, the company said.

 

The performance materials segment reported a 60% drop in operating income to $7.2m due to higher selling, general and administrative expenses and lower volumes.

 

Ashland’s distribution business recorded an operating loss of $4.5m, down from an income of $25.6m in the year-earlier period, reflecting the weak North American manufacturing economy, cost volatility in commodity chemicals and higher selling and general expenses, said the company.

 

($1 = €0.69)

By: Mark Watts
+44 20 8652 3214

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