By Ernest Scheyder
NEW YORK, Jan 26 (Reuters) - Earnings from two major U.S. chemical companies show small signs that the economy may be improving and demand firming for the thousands of items that the industry helps produce.
DuPont and Ashland both reported quarterly earnings on Tuesday that exceeded Wall Street's expectations, with cost cuts providing less of a boost to results than in previous quarters.
Chemical companies make the basic materials used to produce many common items, including solar panels, cosmetics and clothing. When the recession intensified, demand for these products dropped, and consequently earnings across the chemical industry fell.
The last three months of 2008 were generally seen as the worst quarter for the industry, making comparison to the latest quarter relatively easy. Still, both Ashland and DuPont's sales jumps showed demand, however soft, may be strengthening.
Wilmington, Delaware-based DuPont reported a fourth-quarter profit after a loss in the year-ago period and said revenue increased 12.3 percent. Both numbers beat Wall Street's expectations.
'What's fascinating to me is DuPont's level of confidence,' Sterne Agee analyst Mark Connelly said.
The company said sales at five of its six units jumped during the period, and that sales in Asia spiked 36 percent.
'The turnaround we're experiencing in emerging markets bodes well for DuPont as we head into 2010,' Chief Executive Ellen Kullman told investors on Tuesday.
Shares of DuPont rose 17 cents to $32.99 in afternoon trading.
Covington, Kentucky-based Ashland rebounded to post a fiscal first-quarter profit after a loss in same period last year. Revenue rose 2.7 percent.
Sales at three of the company's five segments rose during the period, and the company said margins are stabilizing or improving.
'I continue to be encouraged by Ashland's delivery of profit improvement in the face of a challenging demand environment,' Chief Executive Jim O'Brien said in a statement.
Shares of Ashland rose $3.50, or 8.8 percent, to $43.13 in afternoon trading.
Dow Chemical, the largest U.S. chemical maker, is set to post quarterly results on Feb. 2. Germany's BASF SE -- the world's largest chemical maker -- is scheduled to report results on Feb. 24.
(Editing by Steve Orlofsky) Keywords: CHEMICALS/ (ernest.scheyder@thomsonreuters.com; +1 646-223-6119; Reuters Messaging:ernest.scheyder.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
NEW YORK, Jan 26 (Reuters) - Earnings from two major U.S. chemical companies show small signs that the economy may be improving and demand firming for the thousands of items that the industry helps produce.
DuPont and Ashland both reported quarterly earnings on Tuesday that exceeded Wall Street's expectations, with cost cuts providing less of a boost to results than in previous quarters.
Chemical companies make the basic materials used to produce many common items, including solar panels, cosmetics and clothing. When the recession intensified, demand for these products dropped, and consequently earnings across the chemical industry fell.
The last three months of 2008 were generally seen as the worst quarter for the industry, making comparison to the latest quarter relatively easy. Still, both Ashland and DuPont's sales jumps showed demand, however soft, may be strengthening.
Wilmington, Delaware-based DuPont reported a fourth-quarter profit after a loss in the year-ago period and said revenue increased 12.3 percent. Both numbers beat Wall Street's expectations.
'What's fascinating to me is DuPont's level of confidence,' Sterne Agee analyst Mark Connelly said.
The company said sales at five of its six units jumped during the period, and that sales in Asia spiked 36 percent.
'The turnaround we're experiencing in emerging markets bodes well for DuPont as we head into 2010,' Chief Executive Ellen Kullman told investors on Tuesday.
Shares of DuPont rose 17 cents to $32.99 in afternoon trading.
Covington, Kentucky-based Ashland rebounded to post a fiscal first-quarter profit after a loss in same period last year. Revenue rose 2.7 percent.
Sales at three of the company's five segments rose during the period, and the company said margins are stabilizing or improving.
'I continue to be encouraged by Ashland's delivery of profit improvement in the face of a challenging demand environment,' Chief Executive Jim O'Brien said in a statement.
Shares of Ashland rose $3.50, or 8.8 percent, to $43.13 in afternoon trading.
Dow Chemical, the largest U.S. chemical maker, is set to post quarterly results on Feb. 2. Germany's BASF SE -- the world's largest chemical maker -- is scheduled to report results on Feb. 24.
(Editing by Steve Orlofsky) Keywords: CHEMICALS/ (ernest.scheyder@thomsonreuters.com; +1 646-223-6119; Reuters Messaging:ernest.scheyder.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
