US seasonal electronics rebound weak - Chemtura

15 February 2008 19:06  [Source: ICIS news]

HOUSTON (ICIS news)--The seasonal upturn in demand from the electronics industry was less robust than usual, US specialty chemicals maker Chemtura said on Friday.

The electronics de-stocking cycle hit bottom in the third quarter, and the pickup seen in September and October continued into the fourth quarter, chairman and chief executive Bob Wood told analysts on a conference call.

"While encouraged by the recovery in demand, I have to note that this is not as strong a recovery from cyclical inventory corrections as we have seen in past cycles," Wood said.

"With the recovery remaining sluggish in January, we interpret these trends to reflect broader economic uncertainties and their effects on the electronics industry," he said.

The softening economic conditions were making it hard to pass on input costs, but progress is being made, Wood said.

"The biggest challenge continued to be higher raw material and energy costs, and the lag in recovering those costs through price increases of our own," he said.

"We are gaining momentum there, and expect by year-end to at least keep up with additional raw material increases."

The conference call followed Chemtura's fourth-quarter results, which showed a swing to an operating profit of $24m (€16m) from a loss of $24m a year earlier.

($1 = €0.68)

By: Stephen Burns
+1 713 525 2653

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