Eastman Chemical posts EPS of $2.00 in Q1 2018

27 Apr '18

2 min read

Courtesy: Eastman Chemical Company

Eastman Chemical Company, a producer of speciality chemicals, has recorded reported earnings of $2.00 per diluted share for the first quarter of 2018 versus $1.89 per diluted share for the first quarter in 2017. The company's adjusted earnings were $2.23 per diluted share for first quarter of 2018 versus $1.83 per diluted share in first quarter in 2017.

"We are off to an excellent start in 2018, with year-over-year adjusted EPS growth of 22 per cent in the first quarter,” said Mark Costa, Board chair and CEO. "Our innovation-driven growth model is continuing to deliver impressive volume growth in our specialty businesses as demonstrated by their above market growth in the quarter. Disciplined capital allocation and a sustained focus on cost management also are contributing to our strong results. We remain confident that execution of our strategy will result in continued outstanding results going forward."

Eastman used $35 million in cash for operating activities during first quarter 2018. Strong earnings were partially offset by a normal seasonal increase in working capital. Net cash used for coal gasification operations repair and restart was approximately $75 million in first quarter of 2018. Share repurchases totaled $100 million during the quarter.

"Our compelling performance in the first quarter gives us increasing confidence in our growth expectations for the year. Our innovation-driven growth model continues to deliver results, driving impressive growth in our specialty businesses. In addition, the use of our strong free cash flow along with a modestly lower tax rate is contributing to earnings growth. We continue to work hard to offset volatility in raw material and energy prices, particularly olefins. Taking all of this together, we are increasing our expectations for adjusted 2018 EPS growth to be between 10-14 per cent," Costa said.

The full-year 2018 projected earnings exclude any non-core, unusual, or non-recurring items in the remaining nine months of 2018, and assumes that the adjusted tax rate for first quarter 2018 will be the actual rate for full-year 2018. The 2018 financial results forecasts do not include non-core items (such as mark-to-market pension and other postretirement benefit gain or loss) or any unusual or non-recurring items. The company continues to expect to generate greater than $1.1 billion of free cash flow (cash from operating activities less net capital expenditures). Priorities for uses of available cash include payment of the quarterly dividend, repayment of debt, funding targeted growth initiatives, and repurchasing shares. (RR)

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