PolyOne (POL) Misses Q1 EPS by 2c, Notes Weaker Demand in Certain End Markets

PolyOne (NYSE: POL) reported Q1 EPS of $0.64, $0.02 worse than the analyst estimate of $0.66. Revenue for the quarter came in at $900 million versus the consensus estimate of $923.3 million.

“Like many companies in our space, we experienced weaker demand in certain end markets and unfavorable foreign exchange during the first quarter. This resulted in a year over year decline in sales and earnings,” said Robert M. Patterson, Chairman, President and Chief Executive Officer, PolyOne Corporation. “Key drivers included lower automotive sales in Europe and China which impacted Color, Additives and Inks (Color) and Specialty Engineered Materials (SEM), and a decline in construction related sales, which primarily impacted Performance Products and Solutions (PPS) in North America.”

Mr. Patterson continued, “These headwinds were partially offset by favorable product mix and margin expansion in Distribution as well as new business gains in composites and sustainable solutions. In fact, we had our best quarter ever for composites since we began investing in this space.”

Commenting on the company’s outlook, Mr. Patterson said, “We believe the current market challenges are temporary, and we will see a recovery in the second half of the year. While we are encouraged and optimistic, we are not waiting for market improvement to unfold. Accordingly, we have taken actions to reduce costs primarily through targeted workforce reductions and limiting discretionary spending.”

Mr. Patterson continued, “We believe these actions are prudent in the short term, but also balanced, as we are not curtailing our ability to deliver for the long term. We are continuing to invest in key end markets and innovation, and as this quarter has demonstrated, our investments in composites and sustainable solutions are paying off.”

For earnings history and earnings-related data on PolyOne (POL) click here.

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