Ashland provides update on its outlook for fiscal 2021 financial results1
September 27 2021 - 7:00AM
Ashland Global Holdings Inc. (NYSE: ASH) today provided an update
for preliminary fiscal 2021 financial results. In general, economic
recovery in the U.S. and other regions of the world is driving
strong demand for most products in the company’s Life Sciences,
Personal Care and Household, Specialty Additives and Performance
Adhesives end markets.
However, continued challenges in shipping,
logistics and packaging procurement are inhibiting the company’s
ability to meet strong overall customer demand. The impact of all
these factors is expected to be reflected in the company’s
financial results during the fiscal-fourth quarter. Specifically,
accounting for on-time freight and logistics unreliability over the
past few months, Ashland now anticipates fiscal year Adjusted
EBITDA could be up to $10 million below the low-end of the
previously communicated range of $570 million to $590 million.
“We are encouraged by the improving demand in
each of our segments,” said Guillermo Novo, chairman and chief
executive officer, Ashland. “As we reported early last quarter,
supply-chain and logistics constraints and related costs continue
to be an issue. I am pleased with the pricing and operating
discipline demonstrated by our business teams to maintain margins
in the face of continued challenges. While we are adjusting our
outlook for earnings in the fiscal year due to these external
factors, I continue to be pleased by the resilience of Ashland’s
businesses and our prospects for fiscal year 2022 and beyond.”
During the fiscal-fourth quarter, Ashland
announced the signing of a definitive agreement to sell its
Performance Adhesives business to Arkema for $1.65 billion and the
establishment of a renewable annual environmental trust. Beginning
with the fiscal-fourth quarter, Ashland will report the results of
the Performance Adhesives business as discontinued operations
and any environmental-related expenses as key items. Prior to the
release of fiscal-fourth quarter earnings, Ashland intends to issue
restated historical financial statements reflecting these
changes.
The information in this release is preliminary,
based upon information available at the time of this news release,
and actual results may differ.
Use of Non-GAAP MeasuresAshland
believes that by removing the impact of depreciation and
amortization and excluding certain non-cash charges, amounts spent
on interest and taxes and certain other charges that are highly
variable from year to year, adjusted EBITDA provides Ashland’s
investors with performance measures that reflect the impact to
operations from trends in changes in sales, margin and operating
expenses, providing a perspective not immediately apparent from net
income. The adjustments Ashland makes to derive the non-GAAP
measure of adjusted EBITDA exclude items which may cause short-term
fluctuations in net income and which Ashland does not consider to
be the fundamental attributes or primary drivers of its business.
Adjusted EBITDA provides disclosure on the same basis as that used
by Ashland’s management to evaluate financial performance on a
consolidated and reportable segment basis and provide consistency
in our financial reporting, facilitate internal and external
comparisons of Ashland’s historical operating performance and its
business units and provide continuity to investors for
comparability purposes.
About Ashland
Ashland Global Holdings Inc. (NYSE: ASH) is a premier specialty
materials company with a conscious and proactive mindset for
sustainability. The company serves customers in a wide range of
consumer and industrial markets, including adhesives, architectural
coatings, automotive, construction, energy, food and beverage,
nutraceuticals, personal care and pharmaceutical. Approximately
4,200 passionate, tenacious solvers – from renowned scientists and
research chemists to talented engineers and plant operators –
thrive on developing practical, innovative and elegant solutions to
complex problems for customers in more than 100 countries.
Visit ashland.com and ashland.com/sustainability to
learn more.
Forward-Looking Statements This
news release contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended and
Section 21E of the Securities Exchange Act of 1934, as amended.
Ashland has identified some of these forward-looking statements
with words such as “anticipates,” “believes,” “expects,”
“estimates,” “is likely,” “predicts,” “projects,” “forecasts,”
“objectives,” “may,” “will,” “should,” “plans” and “intends” and
the negative of these words or other comparable terminology.
Ashland may from time to time make forward-looking statements in
its annual reports, quarterly reports and other filings with the
SEC, news releases and other written and oral communications. These
forward-looking statements are based on Ashland’s expectations and
assumptions, as of the date such statements are made, regarding
Ashland’s future operating performance, financial condition and
expected effects of the COVID-19 pandemic on Ashland’s business,
operating cash flow and liquidity, as well as the economy and other
future events or circumstances. These statements include but may
not be limited to Ashland’s expectations regarding the impact of
supply and logistics constraints on its financial results, its
outlook for FY2022 and its ability to drive sales and earnings
growth and realize further cost reductions.
Ashland’s expectations and assumptions include,
without limitation, internal forecasts and analyses of current and
future market conditions and trends, management plans and
strategies, operating efficiencies and economic conditions (such as
prices, supply and demand, cost of raw materials, and the ability
to recover raw-material cost increases through price increases),
and risks and uncertainties associated with the following: the
impact of acquisitions and/or divestitures Ashland has made or may
make (including the possibility that Ashland may not realize the
anticipated benefits from such transactions); Ashland’s substantial
indebtedness (including the possibility that such indebtedness and
related restrictive covenants may adversely affect Ashland’s future
cash flows, results of operations, financial condition and its
ability to repay debt); severe weather, natural disasters, public
health crises (including the current COVID-19 pandemic), cyber
events and legal proceedings and claims (including product recalls,
environmental and asbestos matters); the effects of the COVID-19
pandemic on the geographies in which we operate, the end markets we
serve and on our supply chain and customers, and without
limitation, risks and uncertainties affecting Ashland that are
described in Ashland’s most recent Form 10-K (including Item 1A
Risk Factors) filed with the SEC, which is available on Ashland’s
website at http://investor.ashland.com or on the SEC’s website at
http://www.sec.gov. Various risks and uncertainties may cause
actual results to differ materially from those stated, projected or
implied by any forward-looking statements. The extent and duration
of the COVID-19 pandemic on our business and operations is
uncertain. Factors that will influence the impact on our business
and operations include the duration and extent of the pandemic, the
extent of imposed or recommended containment and mitigation
measures, and the general economic consequences of the pandemic.
Ashland believes its expectations and assumptions are reasonable,
but there can be no assurance that the expectations reflected
herein will be achieved. Unless legally required, Ashland
undertakes no obligation to update any forward-looking statements
made in this news release whether as a result of new information,
future events or otherwise.
1Financial results are preliminary until
Ashland’s FY 2021 Form 10-K is filed with the SEC.
™ Trademark, Ashland or its subsidiaries,
registered in various countries.
FOR FURTHER INFORMATION:
Investor
Relations:
Media Relations:Seth A.
Mrozek
Carolmarie C. Brown+1 (302)
594-5010
+1 (302)
995-3158samrozek@ashland.com
ccbrown@ashland.com
- Q4 2021 Earnings Update FINAL
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