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The company explained that earnings per diluted share for third quarter 2009 were reduced $0.16 per share by the reversal of a previously recognized investment tax credit for the company's Beaumont, Texas, industrial gasification project.
"We continued to make solid progress improving our profitability during what remains a challenging economic environment," said Jim Rogers, president and CEO. "Cash generation also continues to be a priority, and we did a great job during the quarter generating well over $200 million in free cash flow."
In a release dated October 22, the company stated:
- Sales revenue in third quarter 2009 was $1.3 billion compared with $1.8 billion in third quarter 2008. Sales revenue for third quarter 2008 included contract ethylene sales resulting from the fourth-quarter 2006 divestiture of the polyethylene business. Also included in third-quarter 2008 sales revenue were contract polymer intermediates sales resulting from the fourth-quarter 2007 divestiture of PET polymers manufacturing facilities and related businesses in Mexico and Argentina. Excluding these items, sales revenue declined by 21 percent due to lower selling prices in response to lower raw material and energy costs and a decline in sales volume of 4 percent.
- Operating earnings in third quarter 2009 were $191 million compared with operating earnings of $174 million in third quarter 2008. Excluding accelerated depreciation costs and asset impairments and restructuring charges, net, operating earnings were $179 million in third quarter 2008. Operating earnings increased as lower raw material and energy costs and cost reduction actions were partially offset by lower selling prices and lower sales volume. The increased operating margin was attributed to a favorable shift in company product mix due to a higher percentage of overall sales revenue from the Fibers, CASPI, and Specialty Plastics segments compared to the PCI and Performance Polymers segments.
- Eastman generated $331 million in cash from operating activities during third quarter 2009, which included solid net earnings, a continued reduction in working capital, and approximately $100 million from a combination of a refund of previously paid taxes and lower estimated tax payments. The company generated $304 million of positive free cash flow (cash from operations less capital expenditures and dividends) through the first nine months of 2009.
Eastman's chemicals, fibers and plastics are used as key ingredients in products that people use every day.
((Comments on this story may be sent to newsdesk@closeupmedia.com))
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