W.R. Grace Earnings Cheat Sheet: Strong All-Around Quarter

W.R. Grace & Co. (NASDAQ:GRA) posted lower net income in the first quarter compared with a year-earlier period. W.R. Grace & Company is engaged in the production and sale of specialty chemicals and specialty materials on a global basis through its two operating segments, Grace Davison and Grace Construction Products.

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W.R. Grace Earnings Cheat Sheet for the First Quarter

Results: Net income for the specialty chemicals company fell to $54.2 million (72 cents/share) vs. $56.3 million (76 cents/share) a year earlier. A decline of 3.7% from the year earlier quarter.

Revenue: Rose 13.1% to $695.7 million YoY.

Actual vs. Wall St. Expectations: GRA beat the mean analyst estimate of 54 cents/share. Estimates ranged from 51 cents per share to 57 cents per share.

Quoting Management: “We had a good quarter and I am pleased with our results,” said Fred Festa, Grace’s Chairman, President and Chief Executive Officer. “Our catalyst businesses are performing well and we are successfully managing margins despite significant raw material inflation. We are executing well against our performance objectives for sales growth, EBITDA margin expansion and return on invested capital.”

Key Stats: Gross margins grew 1.4 percentage points to 36.2%. The growth seemed to be driven by increased revenue, as the figure rose 13.1% from the year earlier quarter while costs rose 10.6%.

Over the last five quarters, revenue has fallen an average of 1.5% year over year. The biggest drop came in the first quarter of the last fiscal year, when revenue fell 9.9% from the year earlier quarter.

Competitors to Watch: Albemarle Corp. (NYSE:ALB), The Dow Chemical Company (NYSE:DOW), PPG Industries (NYSE:PPG), Rockwood Holdings (NYSE:ROC), Sigma-Aldrich (NASDAQ:SIAL), Celanese (NYSE:CE), BASF (BASFY), Ferro (NYSE:FOE), Huntsman (NYSE:HUN), E.I. du Pont (NYSE:DD), Eastman Chemical (NYSE:EMN), PolyOne (NYSE:POL) and Westlake Chemical (NYSE:WLK).

Today’s Performance: Shares of GRA are trading at $42.99 as of April 26, 2011 at 9:11 AM ET, up over 4% from the previous close.


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