FMC Reports Strong Sales Growth in Q1
First quarter revenue of $795.0 million was 5 percent higher than $756.5 million in the prior year. Excluding the prior-year impact of exited businesses, first quarter revenue increased 10 percent versus the year-ago quarter.
5/3/2011 --- FMC Corporation has reported net income of $94.0 million, or $1.30 per diluted share, in the first quarter of 2011, versus net income of $77.4 million, or $1.06 per diluted share, in the first quarter of 2010. Net income in the current quarter included charges of $13.6 million after tax, or $0.19 per diluted share, versus charges of $22.7 million after tax, or $0.30 per diluted share, in the prior year quarter. Excluding these items in both periods, adjusted earnings were $1.49 per diluted share in the current quarter, an increase of 10 percent versus $1.36 per diluted share in the prior-year quarter. First quarter revenue of $795.0 million was 5 percent higher than $756.5 million in the prior year. Excluding the prior-year impact of exited businesses, first quarter revenue increased 10 percent versus the year-ago quarter.
Pierre Brondeau, FMC president, chief executive officer and chairman, said, "The year is off to a good start as each of our business segments delivered strong profit gains. Agricultural Products' earnings were driven by broad-based sales growth in North America, Latin America and Asia. Specialty Chemicals' performance was led by robust earnings gains in lithium. Industrial Chemicals' earnings increased significantly as a result of higher selling prices across the segment. Our first quarter performance once again reflected the benefits we derive from serving diverse end markets with low correlation to economic cycles; our global presence that is biased toward rapidly-developing economies; our diversified raw material structure and sourcing; and our minimal dependence on petrochemical feedstocks."
Revenue in Agricultural Products of $343.6 million increased 13 percent versus the prior-year quarter. In North America, sales increased significantly due to strong market conditions and earlier season demand, including some shift of sales from the second quarter. In Latin America, the sales increase reflected a strong finish to the crop season, particularly cotton and sugarcane, as well as overall growth in planted acres. In Asia, sales gains were driven by continued strong demand in key markets and favorable weather conditions. As expected, sales in Europe declined as a result of the ongoing re-registration process for bifenthrin. Segment earnings of $100.5 million increased 8 percent versus the year-ago quarter driven by the sales growth, partially offset by higher spending on targeted growth initiatives.
Revenue in Specialty Chemicals was $210.1 million, up 4 percent versus the year-ago quarter as a result of higher volumes and selling prices for lithium specialties and food ingredients, particularly in dairy and beverage markets in Asia, partially offset by lower lithium primaries volumes. Segment earnings of $44.9 million increased 10 percent driven by the sales gain and operating cost reductions in lithium, partially offset by higher spending on focused growth initiatives in food ingredients and higher specialty wood pulp costs in BioPolymer.
Revenue in Industrial Chemicals of $242.5 million declined 3 percent from the year-ago quarter, as higher selling prices across the segment, particularly in soda ash, and volume growth in peroxygens were more than offset by the absence of sales from phosphates and sulfur derivatives businesses that were exited in the prior year. Excluding the prior-year impact of these exited businesses, segment sales increased 11 percent. Segment earnings of $40.3 million increased 17 percent as a result of higher soda ash and peroxygens sales, augmented by a favorable mix shift in peroxygens toward specialties markets.
Corporate expense was $16.8 million versus $12.1 million in the prior-year quarter. Interest expense, net, was $9.9 million as compared to $10.0 million in the year-ago quarter. On March 31, 2011, gross consolidated debt was $663.0 million, and debt, net of cash, was $577.0 million. For the quarter, depreciation and amortization was $30.4 million and capital expenditures were $30.4 million.
Regarding our outlook for 2011, Brondeau said, "We are very confident that we will deliver another record year for the company. For the full-year 2011, we have raised our outlook for adjusted earnings to $5.50 to $5.80 per diluted share, a 14 percent increase above our 2010 adjusted earnings of $4.95 per diluted share at the midpoint of the range. Our Agricultural Products segment expects to achieve its eighth straight year of record earnings, up approximately 10 percent versus a year ago, driven by expected strong market conditions and growth in new and recently introduced products, while increasing spending on growth initiatives and absorbing higher raw material costs. Specialty Chemicals' segment earnings are projected to also increase approximately 10 percent, reflecting higher sales and operating cost reductions across the segment, partially offset by higher raw material and energy costs. In our Industrial Chemicals segment, we expect earnings to be up approximately 30 percent driven by higher selling prices and volume growth across the segment, augmented by the benefit of cost reduction initiatives.
"For the second quarter of 2011, we expect adjusted earnings of $1.40 to $1.55 per diluted share. Agricultural Products' segment earnings are expected to be up approximately 10 percent driven by growth in North America, Europe and Asia, partially offset by higher spending on growth initiatives. Specialty Chemicals' segment earnings are expected to be up in the high-single digits driven by higher volumes and selling prices in BioPolymer and lithium specialties, partially offset by higher spending on growth initiatives in food ingredients in BioPolymer. In Industrial Chemicals, we expect second quarter segment earnings up in the high-teens driven by higher selling prices across the segment, partially offset by start-up costs related to our Granger soda ash facility."