US-based Lilly Industries Inc. indicated that its fiscal third-quarter earnings may fall short of analysts“ projections.
The maker of specialty chemical products (LI) said its net income for the thi…
US-based Lilly Industries Inc. indicated that its fiscal third-quarter earnings may fall short of analysts“ projections. The maker of specialty chemical products (LI) said its net income for the third-quarter ending 31 August will be about even with the year-ago quarter. In the year-earlier period, the company posted net income of US$ 8.7 million, or 37 cents a share, on revenue of US$ 159.3 million. The mean estimate of five analysts surveyed by First Call/Thomson Financial is for earnings of 41 cents a share for the 1999 third quarter. Lilly said third-quarter sales are estimated to increase about 5% over last year. The company noted that demand for wood and powder coatings remain strong, while sales of liquid metal coatings and glass coatings continue to be affected by soft agricultural and construction equipment markets and competitive activity. Product mix and higher operating costs are expected to offset higher sales, the company said, due mainly to increased selling expenses for business expansion. Lilly added that it is pleased with its continued sales momentum but added that expenses associated with its growth strategy will offset revenue gains in the third quarter. The company said it commenced a plan to improve profits by reducing operating expenses and increasing selling prices. Expense reduction means plant closings, employee reductions, supply chain management initiatives and raw material consolidation, according to Lilly.