Ashland posts $274M loss on pension, debt costs

Ashland posts $274M quarterly loss as chemical maker books pension, debt refinancing charges

Associated Press

COVINGTON, Ky. (AP) -- Ashland posted a slightly wider fourth-quarter loss Tuesday as the chemical company booked hefty charges related to a pension loss, debt refinancing and other one-time costs.

Ashland lost $274 million, or $3.49 per share, for the three months ended Sept. 30. That compares with a loss of $263 million, or $3.38 a share, in the same quarter a year ago.

The latest quarter's result included five individual that reduced earnings by a total $422 million, or $5.34 per share, net of taxes. The largest included a non-cash charge of $3.88 per share from an actuarial loss on pension, and a charge of 80 cents per share from debt refinancing. One-time items reduced earnings by $353 million, or $4.51 per share, in the year-ago quarter.

Excluding the five items in the latest quarter, Ashland's adjusted income from continuing operations was $150 million, or $1.87 per share.

On that basis, analysts had expected $1.75 per share, according to a survey by FactSet.

Revenue rose 11 percent to nearly $2.06 billion from $1.85 billion. Analysts had forecast slightly higher revenue of $2.1 billion in the latest quarter.

James O'Brien, Ashland's chairman and chief executive, said three of the company's four business segments became more profitable in the latest quarter as a result of better product pricing and lower costs for raw materials.

Ashland Inc., based in Covington, Ky., said its specialty ingredients unit posted a 57 percent sales increase in the latest quarter, to $734 million. That increase was due in part to additional sales from Ashland's August 2011 purchase of International Specialty Products for $3.2 billion.

Adjusted to reflect Ashland's ongoing business performance, specialty ingredients sales increased 9 percent in the latest quarter. That segment also generated the largest operating income among Ashland's four segments.

"We're beginning to see the type of earnings power that we envisioned when we combined Ashland and ISP, with improved margins that better reflect our focus on specialty chemicals," O'Brien said.

Sales at Ashland's water technologies unit fell 12 percent to $431 million, due in part to a stronger U.S. dollar.

Sales at the performance materials segment slipped to $369 million from $371 million, while sales at the consumer markets segment rose to $522 million from $517 million.

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