Cytec Aerospace Materials Sales Increased 3% to $243 Million

Cytec Industries Inc. announced net earnings for the first quarter of 2014 of $55.9 million or $1.52 per diluted share on net sales of $489 million. Included in the quarter for continuing operations is a special item in the amount of $3.8 million of net income after-tax, or $0.10 per diluted share. Excluding this special item, earnings from continuing operations were $52.0 million or $1.42 per diluted share.   

Net earnings attributable to Cytec for the first quarter of 2013 were $35.6 million or $0.78 per diluted share. Net sales from continuing operations were $477 million.  Earnings from continuing operations for the first quarter of 2013 were $8.7 million or $0.19 per diluted share. Earnings from discontinued operations were $26.9 million or $0.59 per diluted share, net of non-controlling interests.

Included in the quarter for continuing operations were several special items that totaled $30.2 million of net charges after-tax or $0.66 per diluted share.  Excluding the special items, earnings from continuing operations were $38.9 million or $0.85 per diluted share. 

Cytec Aerospace Materials sales increased 3% to $243 million; Operating Earnings decreased to $37.9 million.
In Aerospace Materials, selling prices increased by over 2% and selling volumes increased 1% versus the prior year period.  Volume growth was related primarily to large commercial transport programs including Boeing 787 and 737, offset by demand declines in rotorcraft and missile programs.

Operating earnings of $37.9 million were down versus earnings of $45.0 million in the prior year quarter.  Higher selling prices and volumes were offset by unfavorable costs mainly from a fire at our carbon fiber operation that impacted our fixed cost absorption and our ability to supply internal demand for carbon fiber, resulting in a need to procure external carbon fiber at a higher cost. The fire was contained within the process equipment, there were no injuries and the plant has resumed normal operations.

The full impact of the incident of approximately $3.3 million is all reflected in the first quarter results.  In addition, operating earnings for 2014 reflects a $3 million impact to earnings due to the sale of other higher cost inventory products from the fourth quarter of 2013 when production rates were lowered to reduce inventory levels. In addition, we reallocated stranded costs of $3.8 million from Corporate and Unallocated associated with the April 2013 sale of coating resins business.