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Olin (OLN) Beats Earnings and Revenue Estimates in Q1

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Olin Corporation (OLN - Free Report) posted a profit of $243.6 million or $1.51 per share in first-quarter 2021 against a loss of $80 million or 51 cents per share in the year-ago quarter.

Excluding one-time items, adjusted earnings for the quarter were $1.53 per share, that beat the Zacks Consensus Estimate of $1.34.

The chemical maker’s revenues rallied roughly 35% year over year to $1,918.8 million in the quarter. It also surpassed the Zacks Consensus Estimate of $1,891.1 million. The company saw higher sales across its segments in the first quarter. It benefited from higher pricing in the quarter.

Olin Corporation Price, Consensus and EPS Surprise

 

Olin Corporation Price, Consensus and EPS Surprise

Olin Corporation price-consensus-eps-surprise-chart | Olin Corporation Quote

 

Segment Review

Chlor Alkali Products and Vinyls: Revenues in the division rose roughly 14% year over year to $867 million in the reported quarter as lower volumes were more than offset by higher pricing, specifically ethylene dichloride, chlorine, and chlorinated organics. Lower operating costs also contributed to the segment’s earnings.

Epoxy: Revenues in the division went up around 38.9% year over year to $662.6 million on higher prices.

Winchester: Revenues more than doubled year over year to $389.2 million on increased commercial and military sales as well as higher commercial ammunition pricing.

Financials

Olin ended the first quarter with cash and cash equivalents of $259.9 million, up roughly 34% year over year. Long-term debt was $3,706 million at the end of the quarter, up around 6.2% year over year.

Outlook

Olin expects adjusted EBITDA for 2021 to be between $1.8 billion and $2.1 billion.

The company expects its recent price hike announcements for chlorine, epichlorohydrin, epoxy resins, bleach, ethylene dichloride, caustic soda and chlorinated organics to favorably contribute to its Chemicals businesses in the second quarter. The company envisions some volume offsets as it is selectively selling less into poor-quality markets. It also anticipates higher maintenance costs and unabsorbed fixed manufacturing costs of roughly $40 million related with planned Epoxy maintenance turnarounds in the second quarter.

Second-quarter adjusted EBITDA is projected to improve sequentially from first-quarter 2021 levels barring the net one-time financial benefits from Winter Storm Uri.

Price Performance

Shares of Olin have surged 158.9% in the past year compared with 59.1% rise of the industry.

Zacks Rank & Other Key Picks

Olin currently carries a Zacks Rank #1 (Strong Buy).

Some other top-ranked stocks in the basic materials space are Dow Inc. (DOW - Free Report) , Nucor Corporation (NUE - Free Report) and Impala Platinum Holdings Limited (IMPUY - Free Report) .

Dow has a projected earnings growth rate of roughly 221.7% for the current year. The company’s shares have surged 67.2% in a year. It currently flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Nucor has an expected earnings growth rate of around 203.6% for the current year. The company’s shares have gained 89.9% in the past year. It currently sports a Zacks Rank #1.

Impala has an expected earnings growth rate of 197.6% for the current fiscal. The company’s shares have skyrocketed 224.4% in the past year. It currently flaunts a Zacks Rank #1.

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