Cytec earnings outlook dims as Boeing strike continues

Cytec has reduced its earnings outlook for is Engineered Materials segment, which supplies composite materials for the Boeing 787 Dreamliner.

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Cytec Industries Inc. (West Paterson, N.J., USA) announced on Oct. 9 that it is reducing its outlook for full year 2008 diluted earnings per share after adjusting for special items to a range of $3.75 to $3.85 per share, down from the prior guidance of $4.15 to $4.35 per share.

David Lilley, chairman and CEO, said, “Our third quarter results have met our previous expectations. The principal reasons for the reduced outlook are a continuing strike at a major customer, a further weakening global economy, particularly in Europe, and the impacts in our Building Block Chemicals segment from weakening acrylic fiber demand as well as the adverse effects from hurricane Gustav.

“Cytec’s Engineered Materials segment continued to perform well in the third quarter. However, we are expecting to see a slowdown in orders as a result of the International Machinists (IAM) strike at The Boeing Co. Lilley commented, “We are working very closely with our customers so that we can take actions to match supply with demand. However, we remain positive about the mid- to long-term outlook for advanced composite materials in the aerospace market.” Based on an assumption that the strike will continue to year-end, we are reducing our full-year estimate for operating earnings to be in a range of $138 million to $143 million, down from our prior guidance of $153 million to $158 million.”