Research Desk Line-up: Westlake Chemical Post Earnings Coverage
LONDON, UK / ACCESSWIRE / November 17, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on W.R. Grace & Co. (NYSE: GRA) ("Grace"), which can be viewed by registering at http://protraderdaily.com/optin/'symbol=GRA, following the Company's reporting of its financial results on October 25, 2017, for the third quarter of the fiscal year 2017. The chemical and materials manufacturing Company's adjusted EPS surpassed analysts' expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
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Get more of our free earnings reports coverage from other constituents of the Specialty Chemicals industry. Pro-TD has currently selected Westlake Chemical Corporation (NYSE: WLK) for due-diligence and potential coverage as the Company reported on November 07, 2017, its financial results for Q3 2017 which ended on September 30, 2017. Register for a free membership today, and be among the early birds that get access to our report on Westlake Chemical when we publish it.
At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on GRA; also brushing on WLK. With the links below you can directly download the report of your stock of interest free of charge at:
http://protraderdaily.com/optin/'symbol=GRA
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Earnings Reviewed
For the three months ended September 30, 2017, Grace's net revenue increased 6.2% to $429.5 million from $404.5 million in Q3 FY16.
During Q3 FY17, the Company's gross profit increased 3% to $173.3 million from $168.2 million in the same period of last year. For the reported quarter, the Company's gross margin decreased 130 basis points to 40.3% of revenue from 41.6% of revenue in Q3 FY16.
During Q3 FY17, the Company's adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) increased 5.2% to $136.5 million from $129.7 million in the comparable period of last year. For the reported quarter, the Company's adjusted EBITDA margin decreased 30 basis points to 31.8% of revenue from 32.1% of revenue in Q3 FY16.
During Q3 FY17, the Company's adjusted earnings before interest and taxes (EBIT) increased 5.3% to $108.1 million from $102.7 million in the corresponding period of last year. For the reported quarter, the Company's adjusted EBIT margin decreased 20 basis points to 25.2% of revenue from 25.4% of revenue in Q3 FY16.
For the reported quarter, Grace's net income increased 15% to $47.4 million on a y-o-y basis from $41.2 million in Q3 FY16. During Q3 FY17, the Company's diluted earnings per share (EPS) increased 20.7% to $0.70 on a y-o-y basis from $0.58 in Q3 FY16. For the reported quarter, the Company's adjusted diluted EPS increased 12.5% to $0.90 on a y-o-y basis from $0.80 in Q3 FY16. The adjusted diluted EPS surpassed analysts' expectations of $0.81.
Segment Details
Catalysts Technologies - During Q3 FY17, Grace's Catalysts Technologies segment's net revenue increased 7.3% to $317.5 million from $295.8 million in Q3 FY16, due to higher sales volumes and a favorable currency translation. For the reported quarter, the segment's gross margin decreased 320 basis points to 41.4% of revenue from 44.6% of revenue in Q3 FY16. The decrease was due to a regional and product mix, higher raw materials and energy costs, and a decline in pricing driven by a customer mix. For the reported quarter, the segment's adjusted EBIT margin increased 70 basis points to 32.6% of revenue from 31.9% of revenue in Q3 FY16. For the reported quarter, the segment's adjusted EBITDA margin increased 60 basis points to 39.6% of revenue from 39.0% of revenue in Q3 FY16.
Materials Technologies - During Q3 FY17, Grace's Materials Technologies segment's net revenue increased 3% to $112 million from $108.7 million in Q3 FY16, primarily due to a favorable currency translation and higher sales volumes. For the reported quarter, the segment's gross margin increased 60 basis points to 38.4% of revenue from 37.8% of revenue in Q3 FY16. For the reported quarter, the segment's adjusted EBIT margin decreased 70 basis points to 23.6% of revenue from 24.3% of revenue in Q3 FY16. For the reported quarter, the segment's adjusted EBITDA margin decreased 90 basis points to 28% of revenue from 28.9% of revenue in Q3 FY16.
Balance Sheet
As on September 30, 2017, Grace's cash and cash equivalents increased 93.9% to $175.7 million from $90.6 million as on December 31, 2016. For the reported quarter, the Company's long-term debt increased 0.9% to $1.52 billion from $1.51 billion in Q4 FY16.
During FY17, Grace's YTD cash provided by operating activities increased 28.9% to $267.5 million from $207.6 million in FY16. During FY17, the Company's YTD adjusted free cash flow activities increased 30.9% to $249.3 million from $190.5 million in FY16.
During Q3 FY17, the Company repurchased 510,000 shares of its outstanding common stock for $35.0 million, at an average price per share of $68.64.
Outlook
For FY17, Grace expects revenue growth to be in the range of 6% - 7%, and adjusted EBIT to be in the band of $412 million - $417 million. The Company estimates adjusted EPS to be in the range of $3.36 - $3.41, and adjusted free cash flow to be in the band of $265 million - $275 million for the fiscal year 2017.
Stock Performance
At the closing bell, on Thursday, November 16, 2017, W.R. Grace's stock climbed 1.77%, ending the trading session at $73.02. A total volume of 758.33 thousand shares have exchanged hands, which was higher than the 3-month average volume of 716.48 thousand shares. The Company's stock price advanced 7.79% in the last three months, 3.06% in the past six months, and 8.03% in the previous twelve months. Moreover, the stock gained 7.95% since the start of the year. The stock is trading at a PE ratio of 32.97 and has a dividend yield of 1.15%. The stock currently has a market cap of $4.98 billion.
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