Specialty chemicals company Huntsman Corporation
(HUN - Free Report
) has bought a 20% stake in Japan-based spray polyurethane foam insulation company Nippon Aqua Co. Ltd. In addition, Huntsman has inked a ten-year supply pact with the Yokohama-based company. The terms of the deal were undisclosed.
Nippon Aqua is the market leader in spray polyurethane foam insulation in Japan. The entity, which is a subsidiary of leading residential home builder Hinokiya Holdings Co. Ltd, operates in more than 30 locations across the island nation. Huntsman supplies a number of advanced methylene diphenyl diisocyanate (MDI)-based polyurethanes systems to Nippon Aqua.
Following the Fukushima Daiichi nuclear plant disaster in 2011, there is a significant focus on how Japan will source its energy requirements and an increasing demand amongst consumers for more effective insulation. The investment in Nippon Aqua will allow Huntsman to address these significant needs and help Nippon Aqua to meet strong demand for insulation.
Huntsman announced its fourth-quarter 2012 results last month. The company turned to a loss in the quarter on a reported basis, hurt by $78 million of loss on early redemption of debt and $40 million of restructuring charges. Adjusted earnings of 24 cents a share were in line with the Zacks Consensus Estimate while trailing the year-ago earnings of 28 cents per share.
Revenues inched down 0.5% year over year to $2,619 million in the fourth quarter, yet surpassed the Zacks Consensus Estimate of $2,492 million. Higher sales across Huntsman’s polyurethanes and textile effects businesses were eclipsed by declines across performance products, advanced materials and pigments franchises.
Huntsman currently carries a short-term (1 to 3 months) Zacks Rank #3 (Hold).
Other companies in the chemical industry with favorable Zacks Rank are Akzo Nobel NV
(AKZOY - Free Report
) , Axiall Corporation
, and Air Products
(APD - Free Report
) . All three retain a Zacks Rank #2 (Buy).