Eastman Chemical Surpasses Q3 Expectations with Improvement Across All Segments

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Eastman Chemical Surpasses Q3 Expectations with Improvement Across All Segments

KINGSPORT, Tenn. - Eastman Chemical Company (NYSE:EMN) reported third-quarter earnings that exceeded analyst expectations, driven by strong sales volume growth across all segments. The company's shares rose by 1.8% following the announcement.

The specialty materials manufacturer reported adjusted earnings per share of $2.26, surpassing the analyst consensus of $2.15. Revenue for the quarter reached $2.46 billion, exceeding the forecast of $2.38 billion and representing a 9% increase year-over-year.

Eastman attributed its strong performance to the conclusion of customer destocking processes in most key end markets and innovation driving growth above the underlying market trends, leading to an 8% increase in sales volume/mix. The company saw improvements across all operating segments, with the adjusted EBITDA margin widening by 360 basis points compared to the same quarter last year.

Chairman and CEO Mark Costa stated, "Our third-quarter results were driven by strong sales volume/mix growth, operational leverage, and ongoing commercial excellence. The underlying end market trends remained largely unchanged from the second quarter, consistent with our expectations."

The company narrowed its full-year 2024 earnings per share guidance to a range of $7.50 to $7.70, compared to the previous analyst consensus of $7.69. Eastman expects cash generated from operating activities for the year to approach $1.3 billion.

Costa added, "Despite significant progress in achieving consistent production rates at our Kingsport methanolysis facility, reaching these rates took longer than we expected. Nevertheless, the strong results we achieved in our core business allow us to maintain the midpoint of our full-year adjusted earnings per share guidance."

Eastman returned $195 million to shareholders through share repurchases and dividends during the quarter. The company also announced its decision to continue the construction of a second methanolysis facility in Longview, Texas, as part of its circular economy initiatives.