Loading...
•
Mar 31, 2020
Cabot Q2 2020 Earnings Report
Cabot delivered solid results despite the onset of the COVID-19 pandemic during the quarter.
Key Takeaways
Cabot Corporation announced its second quarter of fiscal year 2020. GAAP EPS was a loss of $0.01 and Adjusted EPS was $0.77. The company completed the acquisition of Shenzhen Sanshun Nano on April 1, 2020.
GAAP EPS was a loss of $0.01, compared to earnings of $0.39 in the prior fiscal year second quarter. Adjusted EPS of $0.77 compared to $0.99 in the prior fiscal year second quarter
Reinforcement Materials EBIT up 30% sequentially and unchanged compared to the prior fiscal year second quarter despite the negative impact from the COVID-19 pandemic
Liquidity remains strong as the company finished the quarter with cash and committed loan facilities of $1.3 billion
Acquisition of Shenzhen Sanshun Nano – a leading producer of carbon nanotubes (CNT) for lithium-ion batteries – completed on April 1, 2020
Cabot
Cabot
Cabot Revenue by Segment
Revenue by Segment
Reinforcement Materials Revenue
CapyFin.comPerformance Chemicals Revenue
CapyFin.com Forward Guidance
Company expects lower demand due to the impact of the COVID-19 pandemic to continue, with a pronounced effect on fiscal third quarter results.
Positive Outlook
- Falling raw material prices
- Intense focus on working capital efficiency to provide strong operating cash flow generation.
- Reducing further our capital spending levels for the fiscal year to approximately $200 million
- Temporarily halted share repurchases
- Taken appropriate cost reduction actions to conserve cash
Challenges Ahead
- Expect a significant reduction in demand in Reinforcement Materials in the third fiscal quarter due to temporary customer shutdowns in Europe and the Americas.
- Expect product mix in specialty carbons and compounds to be negatively impacted by a decline in underlying automotive demand in Europe and the Americas
- Anticipate the challenging price environment for fumed silica in China and Europe will continue.
- Purification Solutions segment will see year-over-year declines in quarterly EBIT due to the impact of COVID-19
- 2020 is going to be a difficult year for the world and our industry
Revenue & Expenses
Visualization of income flow from segment revenue to net income