US Chemtura Q2 income rises on fewer losses from discontinued units

29 July 2014 22:47 Source:ICIS News

HOUSTON (ICIS)--US-based specialty chemicals producer Chemtura reported on Tuesday a net income of $39m, up from a net loss of $93m from the same time last year.

Chemtura reported the Q2 2013 net loss mostly because of a $146m charge from discontinued operations.

However, even without the one-time charge, net income would have still risen year on year because sales rose faster than costs.

Chemtura reported Q2 sales of $609m, up 3.2% from $590m from the same time last year.

Cost of sales were $451m, up $1.6% from $444m from the same time last year.

By segment, industrial performance products reported a Q2 operating income of $26m, compared with $31m from the same time last year. Income dropped because of the lag in passing through higher raw-material costs to customers.

Industrial engineered products was $16m compared with $13m. The segment benefited from customers adopting Chemtura's Emerald Innovation 3000 product, a substitute flame retardant used in styrene-based insulation foams. The company's key customers should complete the switch to the new product by the summer of 2015.

Chemtura AgroSolutions Q2 operating income was $36m compared with $32m. Chemtura is selling AgroSolutions to Platform Specialty Products for $1bn.

Given the company's performance in the first half, Chemtura now expects a year-on-year growth rate of 15-20% for adjusted earnings before interest, tax, depreciation and amortisation (EBITDA), compared with an earlier estimate of 20-30%.

Chemtura produces petroleum additives and polyester polyols as well as thermoplastic polyurethanes and urethane pre-polymers.

It also produces bromine products, many of which are used as flame retardants for plastic additives.

By Al Greenwood