Cytec Industries | Strategy and Financial Highlights Information from ICIS

Edited from “Cytec announces update to operating segments 3 June 2009 and “letter to our stockholders”, annual report 2008”

Cytec Industries believes that the year ahead will continue to be a year of “challenges” as it faces the prospects of a prolonged global recession which will impact many of its large industrial markets. As a result of the extended period of weak demand that it expects to see in a number of its product lines, it has initiated measures to reduce costs and align its manufacturing assets and organisation with this “new demand” environment.

The company has also launched an initiative to significantly reduce its working capital levels over the course of 2009. Its objective with each of these measures is to maintain its liquidity by generating the cash required to self-fund investments in the resources and capital expansion projects required to drive future growth and improve the performance of the company.

“We will stay focused on creating value for our customers and utilise our innovation capabilities to drive sales growth as well as to make step-change improvements in productivity throughout the company. We are committed to make the difficult decisions required to weather the current economic turmoil. We will work through this difficult period, take advantage of the opportunity this affords to drive change and emerge from this downturn a stronger company that is better positioned for future growth”, says chairman, president, and chief executive officer, Shane Fleming.

In June 2009, Cytec made a change to its business segment reporting structure in order to provide greater clarity and bring it inline with its strategy. Cytec will now consist of three operating segments: Coating Resins, Additive Technologies, and In Process Separation.

“While 2009 continues to be a challenging year for us, I am confident that the realignment of our operating segments is the right operating model to implement our long-term strategy more effectively”, says Fleming.

“We are focusing on building on our core technology competencies in high growth markets, which will strengthen our market leadership position in our growth platforms and create greater shareholder value when the economy begins to recover”, continues Fleming.

Cytec states that its vision is to be a premier specialty chemicals and materials company will be achieved through customer focus, superior technology, operational excellence and employee commitment. To achieve this, its strategy will focus on the following initiatives:

Achieve sustainable and profitable growth by providing innovative solutions to meet customer needs

The company will seek to collaborate closely with its customers to understand their needs and provide them with a superior value proposition, whether through improvement in product quality, reduced part cost or a new enabling technology.

Be universally recognised as the technology leader in its markets

Cytec aims to create a sustainable competitive advantage through superior technology. It believes its technology is the ultimate engine of its growth and success. To that end it will focus on its new product pipeline and delivering value-added products to its customers.

Positively impact society by its commitment to safety, health, and environmental stewardship

It will focus its innovation on the development of environmentally sustainable products. It operates on a global basis with manufacturing plants and research facilities located in 18 countries including high growth emerging markets where it can continue to expand sales as markets develop.

In addition, Cytec states that it continuously reviews its operational footprint versus current and projected market demand and from time to time it may shut down parts of or close certain manufacturing or laboratory facilities. Over the years, in the course of its ongoing operations, it has made a number of other strategic business and product line acquisitions and dispositions.

“Our management team regularly reviews our product line portfolio in terms of strategic fit and capital allocation based on financial performance which includes factors such as growth, profitability and return on net assets. From time to time, we may also dispose of or withdraw certain product lines. We may also acquire additional product lines or technologies. We conduct regular reviews of our plant sites’ cost effectiveness, including individual facilities within such sites to insure our long-term competitiveness”, concludes Fleming.

ICIS Chemical Business magazine has unveiled the ICIS Top 100 Chemical Companies, with rankings based on 2008 sales.

A PDF of the ICIS Top 100 Chemical Companies is available for download on ICIS connect.

See the article and analysis of the ICIS Top 100 on ICIS news.

Financial highlights: Cytec, year ended 31 December

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Cytec Industries Company Structure

Cytec Industries is a global speciality chemicals and materials company serving markets for water and waste water treatment, mineral processing, paper manufacturing and recycling, automotive and industrial coatings, plastics, adhesives, aerospace adhesives and composites, and chemical intermediates.
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