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Jodi Allen (Investor Relations)
(973) 357-3283
Cytec Industries Reduces Full
Year 2008 Earnings Guidance
West Paterson, New Jersey, October 9, 2008 - Cytec Industries
Inc. (NYSE: CYT) announced today it is reducing its outlook for
full year 2008 diluted earnings per share after adjusting for
special items to a range of $3.75 to $3.85 per share, down from
the prior guidance of $4.15 to $4.35 per share.
David Lilley, Chairman and Chief Executive Officer said, “Our
third quarter results have met our previous expectations. The
principal reasons for the reduced outlook are a continuing
strike at a major customer, a further weakening global economy,
particularly in Europe, and the impacts in our Building Block
Chemicals segment from weakening acrylic fiber demand as well as
the adverse effects from hurricane Gustav.
“In Cytec Surface Specialties, we continue to experience further
deterioration in demand in North America, and towards the end of
the third quarter we began to see a sharper slowdown in Europe
than we had previously anticipated. Given this difficult
environment, we are estimating the Surface Specialties full year
operating earnings to be in a range of $75 million to $80
million versus our prior estimate of $90 million to $95 million.
“Cytec Performance Chemicals continues to meet our expectations.
Our Mining Chemicals product line performed very well with the
other product lines showing some weakness in various end markets
due to the economic environment. Therefore we are maintaining
our original guidance of growing full year operating earnings in
Performance Chemicals by about 10% or a range of $77 million to
$79 million.
“In Building Block Chemicals, we experienced a negative impact
of approximately $3 million in earnings in the third quarter as
a result of hurricane Gustav. In addition to this event, we have
witnessed further demand destruction in the Asian acrylic fibers
market, which has weakened demand for acrylonitrile in the
second half of 2008. As a result of these conditions, we are
revising our full year operating earnings estimate for Building
Block Chemicals to be in a range of $15 million to $17 million,
down from our prior estimate of $20 million to $22 million.
“Cytec’s Engineered Materials segment continued to perform well
in the third quarter. However, we are expecting to see a
slowdown in orders as a result of the International Machinists
(IAM) strike at The Boeing Company. Mr. Lilley commented, “We
are working very closely with our customers so that we can take
actions to match supply with demand. However, we remain positive
about the mid- to long-term outlook for advanced composite
materials in the aerospace market.” Based on an assumption that
the strike will continue to year-end, we are reducing our full
year estimate for operating earnings to be in a range of $138
million to $143 million down from our prior guidance of $153
million to $158 million.”
In closing, Mr. Shane Fleming, President and Chief Operating
Officer commented, “In these difficult and uncertain times we
are accelerating our reviews of company-wide operations to
ensure our organization and asset base is right-sized with our
latest view of the global economy. As a first step, the third
quarter is expected to include a restructuring charge of about
$5 million relating to a reduction of approximately 40 employees
principally in Specialty Chemicals. While we are confident in
the long-term growth rates of our principal product lines, we
must take the decisive action during these difficult times to
deliver greater results to our investors and to ensure we remain
a strong company able to invest in our future.”
Cytec Industries will report the third quarter 2008 results
after the close of the market on Thursday, October 16. Further
details will be provided in that report and in the third quarter
earnings conference call on Friday, October 17 at 11am ET.
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.
Company 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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