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FMC sees revenues, profit slide

FMC has reported first quarter revenue of $659.4 million, a 13% decrease versus the same period in 2014. The company reported a net loss of $46.8 million, or ($0.35) per diluted share, in the first quarter of 2015, compared to net income of $65.6 million, or $0.49 per diluted share, in the first quarter of 2014.  […]

FMC has reported first quarter revenue of $659.4 million, a 13% decrease versus the same period in 2014. The company reported a net loss of $46.8 million, or ($0.35) per diluted share, in the first quarter of 2015, compared to net income of $65.6 million, or $0.49 per diluted share, in the first quarter of 2014.  First quarter results include charges of $130.6 million after tax, or $0.97 per diluted share, compared to charges of $39.4 million after tax, or $0.29 per diluted share, in the prior-year quarter.  Excluding these items in both periods, adjusted earnings were $0.62 per diluted share, a decline of 21% versus the prior-year quarter of $0.78.

“The first three months of 2015 were characterized by extremely volatile foreign exchange movements, a high degree of uncertainty in global agricultural markets and crop specific headwinds in the Brazil crop protection markets,” said Pierre Brondeau, president, CEO and chairman. “In the quarter, currency movements reduced our revenues by approximately 4 percent and reduced our consolidated adjusted earnings per share by 11 cents.”

“On February 3, 2015, we signed an agreement to sell Alkali Chemicals for $1.64 billion, resulting in discontinued operations treatment of Alkali Chemicals for the first quarter.  The sale was completed on April 1, 2015.  We also closed the Cheminova acquisition on April 21, 2015; however, this timing meant that Cheminova’s strong first quarter performance was not included in our first quarter earnings.”

“The closing of these two transactions completes the key steps to transform our portfolio into one focused on agriculture, health and nutrition.  Looking forward into 2016 and beyond, we expect to see stronger average annual rates of growth in revenues, adjusted operating earnings and adjusted earnings per share than we delivered between 2009 and 2014, with stronger cash generation.  Underlying market growth, expanded market access, new technology introductions, operational excellence and near-term synergies from the Cheminova acquisition, plus stronger free cash flow and lower capital intensity, all will contribute to this financial performance between 2016 and 2020.  We are excited about the prospects for the transformed FMC portfolio in the coming years.”

First-quarter segment revenue for FMC Health and Nutrition was $211.0 million, a decrease of 7% versus the prior-year quarter.  Unfavourable foreign currency impacts, primarily a weaker Euro, decreased revenue by approximately 5%, and lower sales volumes, principally in alginates, reduced revenue by approximately 2%. Segment earnings of $51 million were flat versus the prior-year quarter as improved product mix offset the decline in revenue.

For 2015, full-year segment earnings are expected to increase by mid-single digit percent.  Earnings growth is expected to come from continued demand for pharmaceutical excipients and benefits from ongoing operational improvement and restructuring programs.