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Contact:
Jodi Allen (Investor Relations)
(973) 357-3283
Cytec Industries Reduces Full
Year Earnings Guidance
Current Economy Continues to Impact Demand; Cost Structure
Realignment Underway
Woodland Park, New Jersey, June 23, 2009 – Cytec Industries Inc.
(NYSE:CYT) announced today that due to continued deterioration
in market demand, it is reducing its outlook for full year 2009
diluted earnings per share after adjusting for special items to
a range of $0.60 to $0.90 per share, down from the prior
guidance of $1.35 to $1.75 per share.
Shane Fleming, Chairman and Chief Executive Officer explained,
“We are continuing to see lower demand in Engineered Materials,
resulting from inventory destocking by parts manufacturers for
large commercial aircraft as well as a sharper than expected
slowdown in production rates related to business and regional
jets. In response to these deteriorating market conditions, we
are taking aggressive actions to realign our cost base. While we
are responding to the new market demand in the base business, we
continue to selectively invest in future growth programs and to
be prepared when new large commercial aircraft platforms and the
Joint Strike Fighter come into large scale production. The
secular trend of higher composite usage remains intact, and we
are working with a number of customers on near and long term
opportunities.
In Building Block Chemicals, we are experiencing weak demand in
end markets for melamine products due to the general economic
environment, and are expecting margin pressure in acrylonitrile
due to cost increases in propylene.
We are on track with our cost reduction efforts which are
expected to increasingly benefit our Coating Resins product
lines in the second half of this year. Although weak demand
continues to challenge the Coating Resins products in the
current quarter, we are seeing sequential sales volume
improvement. The remaining segments performance within Specialty
Chemicals continues essentially as expected.”
David Drillock, Vice President and Chief Financial Officer, said
“The continuing weak demand in Coating Resins plus the recent
demand slowdown mentioned earlier in Engineered Materials lead
us to expect a modest loss for the second quarter before special
items, and to decrease our full year earnings per share outlook.
We are making significant progress in the areas within our
control, such as the structural cost improvement programs and
working capital. I am particularly pleased with our success in
the working capital initiative, which has generated improved
cash flow ahead of schedule and has accelerated our debt pay
down.”
Detailed full year guidance will be provided when the Company
releases its second quarter results on July 16, 2009.
Use of Non-GAAP Measures
Management believes that diluted earnings per share after
adjusting for special items, which is a non-GAAP measurement, is
meaningful to investors because it provides a view of the
Company with respect to ongoing operating results. Special items
represent significant charges or credits that are important to
an understanding of the Company’s overall operating results in
the period presented. Such non-GAAP measurement is not
recognized in accordance with generally accepted accounting
principles (GAAP) and should not be viewed as an alternative to
GAAP measures of performance.
Diluted earnings per share determined in accordance with GAAP
may include restructuring charges and other items that are not
currently determinable, but which may be significant. For that
reason, the Company is unable to provide full-year GAAP diluted
earnings per share estimates at this time.
Forward-Looking and Cautionary Statements
Except for the historical information and discussions contained
herein, statements contained in this release may constitute
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Achieving the results
described in these statements involves a number of risks,
uncertainties and other factors that could cause actual results
to differ materially, as discussed in Cytec’s filings with the
Securities and Exchange Commission.
Corporate Profile
Cytec Industries Inc. is a global specialty chemicals and
materials company focused on developing, manufacturing and
selling value-added products. Our products serve a diverse range
of end markets including aerospace, adhesives, automotive and
industrial coatings, chemical intermediates, inks, mining and
plastics. We use our technology and application development
expertise to create chemical and material solutions that are
formulated to perform specific and important functions in the
finished products of our customers.
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