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FMC Corp. lowers earnings outlook and cites drooping demand for chemicals

American Chicago-based FMC Corp. (FMC) sliced its earnings outlook for its flagship chemicals business in September , saying the global economic slowdown has crimped demand for its industrial, special…

American Chicago-based FMC Corp. (FMC) sliced its earnings outlook for its flagship chemicals business in September , saying the global economic slowdown has crimped demand for its industrial, specialty and agricultural chemicals. “Further weakness in the economy, exacerbated by the tragic events of 11 September, will unfavourably affect pro forma operating earnings for the third quarter and full year,” FMC president and chief executive officer William G. Walter said in a written statement. Walter said FMC“s chemicals business is expected to post third-quarter pro forma earnings of 55 to 60 cents a share, down from its previous estimate of 75 to 80 cents a share. For the year, the chemicals business should post pro forma earnings of US$ 3.05 to US$ 3.15 a share, down from an earlier forecast of US$ 3.80 to US$ 4 a share. The company“s forecast reflects only the chemicals business, which FMC separated from its machinery business earlier this year. According to a spokesman at Thomson Financial/First Call in Boston, analysts had been expecting FMC“s chemical operations to post earnings of 76 cents a share in the third quarter. The company blamed the expected shortfall on reduced demand for industrial chemicals, such as hydrogen peroxide, soda ash and phosphorus, and weaker agricultural markets in Japan, China, Pakistan and Indonesia. The company also cited the dollar“s strength against Brazil“s currency, the real. FMC“s operations consist mainly of the chemicals business, since the company spun off its machinery business earlier this year as FMC Technologies Inc. FMC“s chemical operations had pro forma net income of US$ 45.8 million, or US$ 1.41 a share, on revenue of US$ 506 million for last year“s third quarter, and pro forma earnings of US$ 155.7 million, or US$ 4.82 share, on revenue of US$ 2.05 billion for the full year. FMC said it still owns 83% of FMS Technologies, and is “on track” to distribute the remaining ownership in the fourth quarter.

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