Specialty chemicals company Huntsman Corporation (HUN - Snapshot Report) has completed the planned maintenance of its olefins and ethylene oxide plants in Port Neches, Tex. The plants are currently operating at normal rates.
The Utah-based company noted that outage related to the the maintenance took longer than originally expected due to start up issues and unfavorable weather conditions. Huntsman envisions the impact of the prolonged start up on its earnings before interest, taxes, depreciation, and amortization (EBITDA) for first-quarter 2013 will be roughly $55 million. This is $10 million more than its prior guidance of roughly $45 million.
The Port Neches operation, which Huntsman bought from Texaco Chemical during the 1990s, is a major production facility. Huntsman has a capacity to produce 400 million pounds of ethylene and 300 million pounds of propylene at Port Neches.
Huntsman, which has annual sales of more than $11 billion, makes and markets differentiated chemicals. Its makes products for an array of industries including chemicals, plastics, automotive, aviation, textiles, paints and coatings, construction, technology, agriculture, health care, appliances and packaging.
Huntsman, in Feb 2013, announced its fourth-quarter 2012 results. It swung to a loss in the quarter on a reported basis, hit by $78 million of loss on early redemption of debt and $40 million of restructuring charges. Adjusted earnings of 24 cents a share matched the Zacks Consensus Estimate while falling behind the year-ago earnings of 28 cents per share.
Revenues edged down 0.5% year over year to $2,619 million in the fourth quarter, but surpassed the Zacks Consensus Estimate of $2,492 million. Higher sales across Huntsman’s polyurethanes and textile effects businesses were masked 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 - Snapshot Report) , Axiall Corporation and Air Products (APD - Analyst Report) . All three retain a Zacks Rank #2 (Buy).