Excluding several special items totalling $15.1, net earnings were $27.6 million.
Cytec's net earnings for the third quarter of 2008 were $46.3 million and net sales $963.0 million. Excluding items, net earnings were $51.2 million.
Cytec Engineered Materials
Sales for the Cytec Engineered Materials business, which produces prepregs, carbon fibre, adhesives and further products for the aerospace and other markets, fell by 24% to $169 million.
Selling volumes were down 24% on the third quarter of 2008, driven by build rate reductions in business and regional jets, inventory destocking by parts manufacturers in the commercial transport sector, and sales volume reductions in the high performance automotive market.
Selling prices increased by 1% and exchange rates reduced sales by 1%.
Operating earnings of $18.3 million were down from the third quarter 2008 figure of $40.6 million, mainly as a result of lower selling volumes and reduced production rates.
"Capital spending for the quarter was $43 million, with approximately 60% related to Engineered Materials projects," notes David Drillock, Cytec Vice President and CFO. "The majority of the spending in Engineered Materials is related to payments for equipment for the previously delayed carbon fibre plant in South Carolina and completion of the composites manufacturing plant in China.”
2009 outlook
“Our results this past quarter demonstrate the excellent progress we have made with our restructuring efforts and our working capital initiative," says Shane Fleming, Chairman, Cytec President and CEO. "In addition, the sales growth versus the second quarter shows evidence of restocking activity across the Specialty Chemicals markets. These are positive events, but we remain cautious about the remainder of the year if restocking is not replaced by growth in underlying demand.”
"In Engineered Materials, destocking actions are expected to continue across the commercial transport sector, and the business foresees continued weak demand in the business/regional jet and high performance industrial markets," he adds. "As a result, the estimate for full year operating earnings is to be in a range of $85 to $90 million, down from our prior range of $100 to $105 million.
Cytec Industries (NYSE:CYT), Woodland Park, New Jersey, USA, is a global speciality chemicals and materials company. Its businesses cover: Cytec Building Block Chemicals; Cytec Engineered Materials; and Cytec Specialty Chemicals.
