OT ? - Hercules Chemical Sees 4th Quarter Profits 20 to 25 Percent Below Estimates -greenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread |
[Fair Use: For Educational/Research Purposes Only]Friday January 21, 9:48 am Eastern Time
Hercules Sees 4th Quarter Profits 20 to 25 Percent Below Estimates
NEW YORK, Jan 21 (Reuters) - Chemicals firm Hercules Inc. said on Friday that it expects fourth-quarter operating profits to fall 20 to 25 percent below analysts' estimates of 57 cents a share, blaming higher interest and amortization costs as well as Y2K shutdowns.
The Wilmington, Del.-based company said sales increased, but the amortization of information systems, or the allocation of its cost over its expected useful life, will weigh on results.
In the fourth quarter of 1998, Hercules reported a loss of $164 million, or $1.64 per share, on sales of $760 million. The company earned 33 cents a share in the 1998 fourth quarter, excluding a charge from the acquisition of BetzDearborn, a chemical water treatment program provider, and other costs.
``Sales and operating profits in the quarter increased in the Functional Products segment and the Chemical Specialties segment - compared to both third quarter 1999 and fourth quarter 1998,'' Chief Executive and President Vincent Corbo said.
Paper mill shutdowns and the effects of contract pricing in the processing chemicals unit of the paper and pulp division hurt earnings.
``In the BetzDearborn Division, unanticipated year-end costs also caused an unfavorable comparison with the previous quarter despite achieving the highest sales levels of the year,'' Corbo said.
The company is expecting an improvement in gross margins and sales growth from improvements in key markets such as paper, oilfields and in the Asia Pacific and European regions.
The company plans to release fourth-quarter earnings in early February.
-- snooze button (alarmclock_2000@yahoo.com), January 21, 2000