US Eastman expects to see lacklustre GDP growth this year – CEO
Stefan Baumgarten
25-Apr-2014
HOUSTON
(ICIS)–Eastman Chemical expects global economic growth to be
“lacklustre” this year, the CEO of the US-based chemicals
firm said on Friday.
The company started out the year with no year-over-year
revenue growth in the
first quarter ended 31 March and
expects its 2014 full-year revenues to
trend in line with global GDP growth, Mark Costa told
analysts in a conference call.
Eastman’s first quarter was impacted by weak
demand in China, particularly for solvents, tyres
and plasticizer product lines, Costa added.
Eastman’s sales in the Asia-Pacific region were up 1%
year over year to $601m in the first quarter. The region
accounted for 26% of Eastman’s overall first-quarter
sales of $2.3bn.
As for Europe, the region was “solid” but did not show
strong volume growth in the first quarter, Costa said.
“We are seeing good strong growth in automotive demand, and
we are seeing good recovery and strength in the tyre-related
demand [in Europe],” he said.
Eastman’s sales in the Europe, Middle East and Africa region
were flat at $514m in the first quarter.
Costa added that Eastman’s second-quarter revenues start out
strong, with the company seeing growth in markets such as
transportation, building and construction and
consumables.
Longer-term, Eastman’s sales growth should outpace global GDP
growth, he added.
“We remain committed to our strategy of delivering consistent
earnings growth with our portfolio of specialty businesses,”
he said.
“We are well-positioned to leverage our world-class
technology platforms in cellulosics, polyesters, olefins and
PVB [polyvinyl butyral] into new applications as we address
global macro-trends such energy efficiency and a move towards
increased health and wellness,” he said.
Two thirds of Eastman’s revenues come from product lines
where the company holds the No 1 or No 2
market position, he added.
Eastman makes rubber additives, cellulosic polymers, polyesters and hydrocarbon resins as well as non-phthalate plasticizers.
It also makes PVB and its Tritan
copolyester.
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