Cytec aerospace materials sales rise 7% in Q3

Loss from discontinued operations was $0.6 million or $0.01 per diluted share.  Included in the quarter for continuing operations are several special items that total $5.0 million of net charges after-tax, or $0.14 per diluted share, which are outlined further in this release.   Excluding these special items, earnings from continuing operations were $49.4 million or $1.34 per diluted share.     

Net earnings attributable to Cytec for the third quarter of 2012 were $58.4 million or $1.24 per diluted share. Net sales from continuing operations were $455 million. Earnings from continuing operations were $34.7 million or $0.74 per diluted share.  Earnings from discontinued operations were $23.7 million or $0.50 per diluted share, net of non-controlling interest. 

Included in the quarter for continuing operations were several special items that totaled $11.8 million of net charges after-tax or $0.25 per diluted share.  Excluding the special items, earnings from continuing operations were $46.5 million or $0.99 per diluted share.     

Shane Fleming, Chairman, President and Chief Executive Officer commented, “On an as-adjusted basis we delivered a 35% EPS improvement over the prior year quarter driven by higher earnings combined with our lower share count. Our third quarter results reflect more modest top line growth compared to the third quarter of last year as legacy large commercial aircraft build rates have plateaued.  We believe that Aerospace Materials sales are also being impacted by continued destocking by several tier one suppliers reducing sales for the quarter.

We are encouraged by the improved results within the Industrial Materials segment, where we have begun to see some pickup in demand in the high performance auto market.  The In Process Separation segment had reduced sales coming from lower demand for phosphine gases in the electronics market and returned product related to a temporary quality issue.  While the alumina markets remain weak, sales to our other metals markets remain on track.”

Cytec Aerospace Materials sales increased 7% to $236 million; Operating Earnings up slightly to $40.7 million.

In Aerospace Materials, total selling volumes increased by 4% versus the third quarter 2012 with approximately half due to the acquisition of Umeco and the remainder mostly driven by higher large commercial transport build rates.  Growth in commercial transport was partially offset by lower sales to the rotorcraft sector.  Selling prices increased by 3% versus the prior year period.

Operating earnings of $40.7 million were slightly up versus earnings of $40.4 million in the prior year quarter.  Higher selling prices and volumes were offset by higher expenses of approximately $1.5 million related to the planned carbon fiber maintenance turn-around and expense work related to our ongoing capital projects.

In addition, operating expenses are higher due to costs of $0.8 related to the acquired Umeco business and the impact of stranded costs of approximately $2.7 million associated with the sale of the coating resins business earlier this year.

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Cytec Industries