Arch Chemicals Inc. (ARJ, Financial) filed Quarterly Report for the period ended 2010-09-30.
Arch Chemicals Inc. has a market cap of $908.4 million; its shares were traded at around $36.25 with a P/E ratio of 14.3 and P/S ratio of 0.6. The dividend yield of Arch Chemicals Inc. stocks is 2.2%. Arch Chemicals Inc. had an annual average earning growth of 11.8% over the past 10 years.ARJ is in the portfolios of John Keeley of Keeley Fund Management, Mario Gabelli of GAMCO Investors, Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors.
The Company has increased its full-year 2010 earnings guidance. Full-year sales are expected to be approximately nine to eleven percent higher than 2009, and earnings from continuing operations before special items for the full-year 2010 are now anticipated to be in the $2.40 to $2.50 per share range, compared to the Companys previous guidance in the $2.25 to $2.40 per share range. This increased guidance reflects the Companys strong third quarter results. Depreciation and amortization forecasts remain in the $40 to $45 million range and capital spending is now expected to be in the $30 million range. The effective tax rate from continuing operations is estimated to be in the 32 to 33 percent range, excluding the impact of the U.K. tax rate change.
For the fourth quarter, the Company anticipates (loss) earnings per share from continuing operations to be in the range of $(0.06) to $0.04, compared to earnings per share from continuing operations of $0.12 during the fourth quarter of 2009. Improved operating profits from higher volumes in the HTH water products and personal care and industrial biocides businesses are expected to be offset by lower performance urethanes results due to the conclusion of the long-term contract manufacturing arrangement at the end of 2009. The Company also expects slightly higher interest costs, general corporate expenses and income tax expense compared to the prior year.
Performance urethanes sales increased $7.0 million, or 20 percent, due to higher pricing (12 percent) and higher volumes (eight percent). The higher pricing was in response to increased raw material costs. Volumes improved due to higher demand for propylene glycol products, including the addition of new accounts, and higher demand for polyol products. Operating income decreased $1.5 million due to the effect of the conclusion of the long-term contract manufacturing arrangement at the end of 2009, which contributed $3.2 million. Excluding the impact of the contract, improved pricing and higher volumes more than offset higher raw material costs.
Sales increased $14.4 million, or 12 percent, as improved pricing (14 percent) was partially offset by lower volumes (two percent). Operating income decreased by $6.6 million.
Performance urethanes sales increased $14.5 million, or 13 percent, as higher pricing (16 percent) driven by increased raw material costs, more than offset lower volumes (three percent). The lower volumes were due to the conclusion of a long-term contract manufacturing arrangement at the end of 2009, which was partially offset by higher demand for propylene glycol products, due to the addition of new accounts, and higher demand for polyol products. Operating results decreased by $6.3 million, principally due to the effect of the conclusion of the contract manufacturing arrangement, which contributed $9.7 million. The higher pricing was mostly offset by higher raw material costs.
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Arch Chemicals Inc. has a market cap of $908.4 million; its shares were traded at around $36.25 with a P/E ratio of 14.3 and P/S ratio of 0.6. The dividend yield of Arch Chemicals Inc. stocks is 2.2%. Arch Chemicals Inc. had an annual average earning growth of 11.8% over the past 10 years.ARJ is in the portfolios of John Keeley of Keeley Fund Management, Mario Gabelli of GAMCO Investors, Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors.
Highlight of Business Operations:
In August 2010, the Company announced its decision to consolidate three of its existing U.S. Research and Development (R&D) and Technical Service facilities in Alpharetta, Georgia. During the three months ended September 30, 2010, the Company recorded a $0.7 million charge for estimated employee severance costs. Additionally, the Company recorded a $1.2 million impairment charge related to its New Castle, Delaware facility.The Company has increased its full-year 2010 earnings guidance. Full-year sales are expected to be approximately nine to eleven percent higher than 2009, and earnings from continuing operations before special items for the full-year 2010 are now anticipated to be in the $2.40 to $2.50 per share range, compared to the Companys previous guidance in the $2.25 to $2.40 per share range. This increased guidance reflects the Companys strong third quarter results. Depreciation and amortization forecasts remain in the $40 to $45 million range and capital spending is now expected to be in the $30 million range. The effective tax rate from continuing operations is estimated to be in the 32 to 33 percent range, excluding the impact of the U.K. tax rate change.
For the fourth quarter, the Company anticipates (loss) earnings per share from continuing operations to be in the range of $(0.06) to $0.04, compared to earnings per share from continuing operations of $0.12 during the fourth quarter of 2009. Improved operating profits from higher volumes in the HTH water products and personal care and industrial biocides businesses are expected to be offset by lower performance urethanes results due to the conclusion of the long-term contract manufacturing arrangement at the end of 2009. The Company also expects slightly higher interest costs, general corporate expenses and income tax expense compared to the prior year.
Performance urethanes sales increased $7.0 million, or 20 percent, due to higher pricing (12 percent) and higher volumes (eight percent). The higher pricing was in response to increased raw material costs. Volumes improved due to higher demand for propylene glycol products, including the addition of new accounts, and higher demand for polyol products. Operating income decreased $1.5 million due to the effect of the conclusion of the long-term contract manufacturing arrangement at the end of 2009, which contributed $3.2 million. Excluding the impact of the contract, improved pricing and higher volumes more than offset higher raw material costs.
Sales increased $14.4 million, or 12 percent, as improved pricing (14 percent) was partially offset by lower volumes (two percent). Operating income decreased by $6.6 million.
Performance urethanes sales increased $14.5 million, or 13 percent, as higher pricing (16 percent) driven by increased raw material costs, more than offset lower volumes (three percent). The lower volumes were due to the conclusion of a long-term contract manufacturing arrangement at the end of 2009, which was partially offset by higher demand for propylene glycol products, due to the addition of new accounts, and higher demand for polyol products. Operating results decreased by $6.3 million, principally due to the effect of the conclusion of the contract manufacturing arrangement, which contributed $9.7 million. The higher pricing was mostly offset by higher raw material costs.
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