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W.R. Grace & Co. Reports Operating Results (10-Q)

August 06, 2012 | About:
10qk

10qk

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W.R. Grace & Co. (GRA) filed Quarterly Report for the period ended 2012-06-30.

W.r. Grace & Co. has a market cap of $4.25 billion; its shares were traded at around $56.87 with a P/E ratio of 14 and P/S ratio of 1.3. W.r. Grace & Co. had an annual average earning growth of 6.7% over the past 10 years.

Highlight of Business Operations:

Sales for the six months increased 3.9% overall compared with the prior-year period. The sales increase was due to improved base pricing (+5.4%) and higher sales volumes (+2.2%), partially offset by unfavorable currency translation (-3.0%) and lower rare earth surcharges (-0.7%). Sales in emerging regions grew 13.7% and represented 34.9% of our total sales compared with 31.9% in the prior-year period.

Sales of Catalysts Technologies were $328.6 million for the second quarter, a decrease of 1.9% compared with the prior-year quarter. The decrease was due to lower rare earth surcharges (-7.7%) and unfavorable currency translation (-4.2%), partially offset by improved base pricing (+7.9%) and higher sales volumes (+2.1%). Declines in rare earth prices resulted in lower rare earth surcharges compared with the prior-year quarter, a trend we expect to continue through the balance of the year. The increase in base pricing was driven by the adoption of our low and no rare earth FCC catalysts and by price increases designed to offset the higher costs of certain raw materials. Sales volumes increased in polyolefin catalysts, driven by strong polyethylene catalyst demand and continued growth in new polypropylene catalysts, while sales volumes for FCC catalysts decreased due to refinery slowdowns and closures by certain of our customers. Several large refineries in the mature markets have closed over the last 12 months, which reduced our sales volumes in the second quarter by approximately $12 million. We expect this capacity to be replaced by more economically efficient refineries in emerging regions.

Sales of Catalysts Technologies were $640.9 million for the six months, an increase of 5.0% compared with the prior-year period. The increase was due to improved base pricing (+9.1%) and higher sales volumes (+0.6%), partially offset by unfavorable currency translation (-2.9%) and lower rare earth surcharges (-1.8%).

Sales of Materials Technologies were $438.1 million for the six months, a decrease of 1.8% compared with the prior-year period. The decrease was due to unfavorable currency translation (-3.4%) and lower sales volumes (-1.3%), partially offset by improved pricing (+2.9%). Lower sales volumes resulted from lower engineered materials sales volumes in Europe and Asia. Slowing demand for coatings in Asia late last year carried into the first part of this year.

Sales of Construction Products were $502.1 million for the six months, an increase of 7.9% compared with the prior-year period. The increase was due to higher sales volumes (+7.8%) and improved pricing (+2.9%), partially offset by unfavorable currency translation (-2.8%). Sales in emerging regions, which represented 33.0% of sales in the six months, increased 17.0% due to the strong sales performance in emerging Asia, Latin America and the Middle East. Sales in North America increased 8.3%, due to an increase in multi-family residential and infrastructure projects in the United States. Sales in EMEA (including India) increased as lower sales in Western Europe were more than offset by growth in the Middle East and India.

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