Cabot Q1 2024 Earnings Report
Key Takeaways
Cabot Corporation reported its first quarter fiscal year 2024 results, showcasing a strong adjusted EPS of $1.56, up 59% year-over-year, driven by operational excellence and agility in a weak market. The Reinforcement Materials segment and Performance Chemicals segment both experienced significant EBIT growth, and the company finalized calendar year 2024 customer agreements with improved pricing and product mix. Strong operating cash flow supported shareholder returns through dividends and share repurchases, while the balance sheet remained strong.
Adjusted EPS reached $1.56, a 59% increase year-over-year.
Reinforcement Materials segment EBIT increased by 37% compared to the same quarter in the prior year.
Performance Chemicals segment EBIT grew by 17% year-over-year.
Operating cash flow was strong at $105 million, supporting shareholder returns.
Cabot
Cabot
Cabot Revenue by Segment
Forward Guidance
Cabot anticipates adjusted earnings per share for fiscal year 2024 to be in the range of $6.30 to $6.80, reflecting a 22% increase at the midpoint compared to fiscal 2023. They expect strong operating cash flow, which would allow them to continue investing in strategic growth projects and to continue to return robust levels of cash to shareholders through dividends and share repurchases.
Positive Outlook
- Adjusted EPS for fiscal year 2024 is expected to be in the range of $6.30 to $6.80.
- Expect to generate growth in adjusted EPS as reflected in our guidance range.
- Outlook for operating cash flow remains strong.
- Continue investing in strategic growth projects.
- Continue to return robust levels of cash to shareholders through dividends and share repurchases.
Challenges Ahead
- Industry capacity utilization and competition from other specialty chemical companies
- Safety, health and environmental requirements and related constraints imposed on our business
- Regulatory and financial risks related to climate change developments
- Volatility in the price and availability of energy and raw materials, including with respect to the Russian invasion of Ukraine, and the U.S.-China trade relationship
- Unanticipated delays in, or increased cost of site development projects
Revenue & Expenses
Visualization of income flow from segment revenue to net income