Eastman Chemical Company (NYSE:EMN) announced its fourth-quarter
and full-year 2023 financial results.
This press release features multimedia. View
the full release here:
https://www.businesswire.com/news/home/20240201020717/en/
- Delivered approximately $1.4 billion of cash from operating
activities in 2023, demonstrating the strength of our cash
flow.
- Demonstrated commercial excellence in our pricing by leveraging
the strength of our value proposition to offset significant
macro-driven volume challenges.
- Reduced costs by approximately $200 million in 2023, net of
inflation.
- Closed the previously announced divestiture of Texas City
Operations for $490 million.
- Introduced plastic waste into the Kingsport methanolysis
facility and expect to produce on spec material and to generate
revenue soon.
(In millions, except per share amounts;
unaudited)
4Q23
4Q22
FY23
FY22
Sales revenue
$2,207
$2,373
$9,210
$10,580
Earnings before interest and taxes
(“EBIT”)
477
76
1,302
1,159
Adjusted EBIT*
222
171
1,097
1,339
Earnings per diluted share
2.61
0.01
7.49
6.35
Adjusted earnings per diluted share*
1.31
0.89
6.40
7.88
Net cash provided by operating
activities
452
457
1,374
975
* For non-core and unusual items
excluded from adjusted earnings and for adjusted provision for
income taxes, segment adjusted EBIT margins, and net debt,
reconciliations to reported company and segment earnings and total
borrowings for all periods presented in this release, see Tables
3A, 3B, 4, and 6.
“We delivered solid fourth-quarter results in a macroeconomic
environment with weak primary demand due to seasonal declines and
continued customer inventory destocking in some of our key end
markets, including agriculture and medical,” said Mark Costa, Board
Chair and CEO. “Against this backdrop, we remained laser focused on
cash generation and are incredibly proud to have generated
approximately $1.4 billion of operating cash flow in 2023. In
addition to our strong cash flow, we reduced costs by approximately
$200 million in 2023, demonstrating our continued discipline. We
enter 2024 on an upbeat note with the completed construction of our
methanolysis facility in Kingsport, Tennessee. We just recently
introduced plastic waste into the front end of the process and
expect to produce on spec material and to generate revenue soon. We
are building momentum as a leader in the circular economy, which
adds to my confidence in the resilience of our earnings and cash
flow going forward.”
Corporate Results 4Q 2023 versus 4Q 2022
Sales revenue decreased 7 percent driven by 5 percent lower
selling prices and 2 percent lower sales volume/mix.
Lower selling prices were due to lower raw material prices.
Lower sales volume/mix was due to weak end-market demand and
continued customer inventory destocking in some end markets,
particularly agriculture and medical.
Reported EBIT increased due to a gain on the sale of our Texas
City Operations. Adjusted EBIT increased to $222 million compared
to $171 million in fourth quarter 2022. Price-cost increased due to
the continued flow through of lower variable costs more than
offsetting lower selling prices. The improvement in price-cost was
partially offset by lower sales volume/mix, lower capacity
utilization, higher pension expense, and increased SG&A expense
due to higher variable compensation.
Segment Results 4Q 2023 versus 4Q 2022
Advanced Materials – Sales revenue decreased 4 percent
due to 5 percent lower sales volume/mix.
Lower sales volume/mix was driven by continued weak end-market
demand and destocking across key end markets, particularly medical,
packaging, and building and construction, partially offset by
continued strength in automotive.
EBIT increased due to commercial excellence in pricing and the
continued flow through of substantially lower variable costs, which
were elevated in the prior year period. This price-cost benefit was
partially offset by lower capacity utilization, higher planned
maintenance costs, and lower sales volume/mix.
Additives & Functional Products – Sales revenue
decreased 15 percent due to 10 percent lower selling prices and 6
percent lower sales volume/mix.
Lower selling prices were primarily due to cost-pass-through
contracts. Sales volume/mix was lower due to weak demand,
especially in the building and construction end market and timing
for some heat transfer fluid fills, as well as aggressive customer
inventory destocking in the agriculture end market.
Decreased EBIT included lower sales volume/mix and lower
capacity utilization, mostly offset by lower variable costs more
than offsetting lower selling prices.
Fibers – Sales revenue increased 9 percent due to 13
percent higher selling prices, partially offset by 4 percent lower
sales volume/mix.
Substantially higher selling prices for acetate tow were due to
an increase in industry capacity utilization and higher raw
material, energy, and distribution prices throughout 2022.
EBIT increased due to recovery of margins as higher selling
prices returned EBIT margins to acceptable performance levels.
Chemical Intermediates – Sales revenue decreased 9
percent due to 16 percent lower selling prices, partially offset by
7 percent higher sales volume/mix.
Lower selling prices across the segment were primarily due to
lower raw material prices and weak end-market demand.
Reported EBIT increased due to a gain on the sale of Texas City
Operations. Adjusted EBIT was unchanged compared to the prior year
period. Increased spreads were offset by lower sales volume/mix and
lower capacity utilization.
Corporate Results 2023 versus 2022
Sales revenue decreased 13 percent due to 9 percent lower sales
volume/mix, 2 percent unfavorable impact from divested businesses,
and 2 percent lower selling prices.
Lower sales volume/mix was due to weak primary demand and
significant customer inventory destocking across many of the
company’s key end markets, except for strength in
transportation.
Reported EBIT increased due to a gain on the sale of Texas City
Operations. Adjusted EBIT decreased primarily due to lower sales
volume/mix and lower capacity utilization to drive cash generation,
increased pension expense of approximately $110 million, increased
SG&A expense due to higher variable compensation, continued
investment in the circular platform, and an approximately $50
million unfavorable impact from foreign currency. These factors
were partially offset by lower variable costs more than offsetting
lower selling prices and the benefit from the company’s cost
reduction initiatives.
Segment Results 2023 versus 2022
Advanced Materials – Sales revenue decreased 9 percent
primarily due to 11 percent lower sales volume/mix, partially
offset by 3 percent higher selling prices.
Lower specialty plastics sales volume/mix was due to weak
primary demand and significant customer inventory destocking across
key end markets. Growth in the automotive market was driven by the
success of high-value premium interlayers. Selling prices increased
in advanced interlayers due to increased prices for raw materials
in the prior year period.
EBIT decreased due to lower sales volume/mix and lower capacity
utilization, partially offset by higher selling prices and the flow
though of lower variable costs. EBIT included an approximately $35
million unfavorable impact from foreign currency.
Additives & Functional Products – Sales revenue
decreased 18 percent due to 13 percent lower sales volume/mix and 5
percent lower selling prices.
Sales volume/mix was lower due to weak demand and significant
customer inventory destocking in several key end markets, including
building and construction and agriculture. Lower selling prices
were primarily due to cost-pass-through contracts.
EBIT decreased due to lower sales volume/mix and lower capacity
utilization, partially offset by favorable price-cost.
Fibers – Sales revenue increased 27 percent primarily due
to 26 percent higher selling prices.
Substantially higher selling prices for acetate tow were due to
an increase in industry capacity utilization and higher raw
material, energy, and distribution prices throughout 2022.
EBIT increased due to recovery of margins as higher selling
prices returned EBIT margins to acceptable performance levels.
Chemical Intermediates – Sales revenue decreased 21
percent due to 13 percent lower selling prices, and 8 percent lower
sales volume/mix.
Lower selling prices across the segment were primarily due to
lower raw material prices and weak end-market demand. Lower sales
volume/mix was due to weak end-market demand and significant
customer inventory destocking across several key end markets.
Reported EBIT increased due to a gain on the sale of Texas City
Operations. Adjusted EBIT decreased compared to the prior year
period due to lower sales volume/mix, lower capacity utilization,
and lower spreads.
Cash Flow
In 2023, cash provided by operating activities was approximately
$1.4 billion compared to approximately $1 billion in 2022. The
strong increase compared to the prior year period was primarily
driven by a reduction of working capital in 2023 compared to an
increase in 2022. In 2023, the company returned $526 million to
stockholders through dividends and share repurchases. See Table 5.
Priorities for uses of available cash for 2024 include organic
growth investments, payment of the quarterly dividend, bolt-on
acquisitions, and share repurchases.
2024 Outlook
Commenting on the outlook for full-year 2024, Costa said: “As we
begin 2024, the global economic environment remains uncertain.
Despite this uncertainty, we are confident in our ability to
generate growth across our portfolio for a number of reasons.
First, we continue to expect volume growth due to the absence of
customer inventory destocking in our end markets, except medical
and agriculture, which continue to destock in the first quarter.
And we expect modest primary demand growth in some stable end
markets while discretionary end markets remain flat. Second, we
expect to benefit from revenue and earnings generated by our
Kingsport methanolysis facility. Third, we also expect improved
asset utilization to be a benefit after aggressively managing
inventory across the company in 2023. Finally, we expect these
tailwinds to be partially offset by lower price-cost negatively
impacting margins, primarily in Chemical Intermediates. And we will
manage costs to offset inflation while continuing to invest in
growth and capabilities for long-term value creation. Taking this
together, we expect 2024 EPS to be between $7.25 - $8.00 and for
2024 cash from operations to be approximately $1.4 billion.”
The full-year 2024 projected adjusted diluted EPS excludes any
non-core, unusual, or nonrecurring items. Our financial results
forecasts do not include non-core items (such as mark-to-market
pension and other postretirement benefit gain or loss, and asset
impairments and restructuring charges) or any unusual or
non-recurring items because we are unable to predict with
reasonable certainty the financial impact of such items. These
items are uncertain and depend on various factors, and we are
unable to reconcile projected adjusted diluted EPS excluding
non-core and any unusual or non-recurring items to reported GAAP
diluted EPS without unreasonable efforts.
Forward-Looking Statements
This information and other statements by the company may contain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act with respect to, among other
items: projections and estimates of earnings, revenues, volumes,
pricing, margins, cost reductions, expenses, taxes, liquidity,
capital expenditures, cash flow, dividends, share repurchases or
other financial items, statements of management’s plans, strategies
and objectives for future operations, and statements regarding
future economic, industry or market conditions or performance. Such
projections and estimates are based upon certain preliminary
information, internal estimates, and management assumptions,
expectations, and plans. Forward-looking statements are subject to
a number of risks and uncertainties, and actual performance or
results could differ materially from that anticipated by any
forward-looking statements. Forward-looking statements speak only
as of the date they are made, and the company undertakes no
obligation to update or revise any forward-looking statement. Other
important assumptions and factors that could cause actual results
to differ materially from those in the forward-looking statements
are detailed in the company’s filings with the Securities and
Exchange Commission (the “SEC”), which are accessible on the SEC’s
website at www.sec.gov and the company’s website at
www.eastman.com.
Conference Call and Webcast Information
Eastman will host a conference call with industry analysts on
Feb 2, 2024, at 8:00 a.m. ET. To listen to the live webcast of the
conference call and view the accompanying slides and prepared
remarks, go to investors.eastman.com, Events & Presentations.
The slides and prepared remarks to be discussed during the call and
webcast will be available at investors.eastman.com at approximately
4:30 p.m. ET on Feb 1, 2024. To listen via telephone, the dial-in
number is +1 (833) 470-1428, passcode: 844307. A web replay, a
replay in downloadable MP3 format, and the accompanying slides and
prepared remarks will be available at investors.eastman.com, Events
& Presentations. A telephone replay will be available
continuously beginning at approximately 1:00 p.m. Eastern Time, Feb
2, 2024, through 11:59 p.m. Eastern Time, Feb. 12, 2024, Toll Free
at +1 (866) 813-9403, passcode 209674.
Founded in 1920, Eastman is a global specialty materials company
that produces a broad range of products found in items people use
every day. With the purpose of enhancing the quality of life in a
material way, Eastman works with customers to deliver innovative
products and solutions while maintaining a commitment to safety and
sustainability. The company’s innovation-driven growth model takes
advantage of world-class technology platforms, deep customer
engagement, and differentiated application development to grow its
leading positions in attractive end markets such as transportation,
building and construction, and consumables. As a globally inclusive
and diverse company, Eastman employs approximately 14,000 people
around the world and serves customers in more than 100 countries.
The company had 2023 revenue of approximately $9.2 billion and is
headquartered in Kingsport, Tennessee, USA. For more information,
visit www.eastman.com.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240201020717/en/
Media: Tracy Kilgore Addington 423-224-0498 /
tracy@eastman.com
Investors: Greg Riddle 212-835-1620 / griddle@eastman.com
Eastman Chemical (NYSE:EMN)
Graphique Historique de l'Action
De Avr 2024 à Mai 2024
Eastman Chemical (NYSE:EMN)
Graphique Historique de l'Action
De Mai 2023 à Mai 2024