Cabot Corp. (CBT) Misses Q1 EPS by 4c, Offers FY Guidance

Cabot Corp. (NYSE: CBT) reported Q1 EPS of $0.69, $0.04 worse than the analyst estimate of $0.73. Revenue for the quarter came in at $727 million versus the consensus estimate of $765.56 million.

GUIDANCE:

Cabot Corp. sees FY2020 EPS of $3.60-$3.90, versus the consensus of $3.80.

• Commenting on the outlook for the Company, Keohane said, “While the first fiscal quarter was impacted by more pronounced year-end customer inventory management in Reinforcement Materials, we expect company earnings to improve as we move through this fiscal year. We anticipate that Reinforcement Materials will benefit from the calendar year 2020 customer agreements, and volumes will return to a more normalized level starting in the second fiscal quarter. In Performance Chemicals, volumes have stabilized at a higher level than the first half of fiscal 2019 in the specialty carbons and specialty compounds product lines, while we anticipate the challenging price environment for fumed silica in China and Europe that we experienced in the first quarter will continue in the near-term. Additionally, we expect the Purification Solutions segment will continue to see year-over-year improvement in quarterly EBIT. With these factors in mind, we expect full year Adjusted EPS to be in the $3.60 to $3.90 band of our previously communicated range. Impacts from recent developments with the coronavirus are difficult to predict and we have therefore not included impacts in our second quarter or full-year outlook.”
• Keohane continued, “As we look ahead, we are pleased to see the first phase of a trade deal between the U.S. and China, improving volumes in our specialty carbons and specialty compounds product lines, and the favorable outcome from our 2020 calendar year Reinforcement Materials customer agreements. However, given the continuing uncertainty in the overall business environment, particularly in China, we will continue to manage costs, net working capital and capital expenditures aggressively. We are excited about our recently announced acquisition of Shenzhen Sanshun Nano and we expect this acquisition will strengthen our position as a leading supplier to the growing battery sector. We remain committed to generating strong cash flow, investing for the future in our core businesses and returning cash to shareholders.”

For earnings history and earnings-related data on Cabot Corp. (CBT) click here.

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