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Olin (OLN) Earnings and Revenues Surpass Estimates in Q2

·4-min read

Olin Corporation OLN posted a profit of $422.1 million or $2.76 per share in second-quarter 2022, compared to $355.8 million or $2.17 per share in the year-ago quarter. The figure beat the Zacks Consensus Estimate of $2.57.

The chemical maker’s revenues rallied roughly 17.8% year over year to $2,616.1 million in the quarter. It also surpassed the Zacks Consensus Estimate of $2,524.5 million. The company saw higher sales in Chlor Alkali Products and Vinyls segment. The company’s performance benefited from higher pricing in the quarter.

Olin Corporation Price, Consensus and EPS Surprise

 

Olin Corporation Price, Consensus and EPS Surprise
Olin Corporation Price, Consensus and EPS Surprise

Olin Corporation price-consensus-eps-surprise-chart | Olin Corporation Quote

 

Segment Review

Chlor Alkali Products and Vinyls: Revenues in the division rose roughly 45.1% year over year to $1,403.5 million in the reported quarter. The upside can be attributed to higher pricing, partly offset by lower volumes.

Epoxy: Revenues in the division went down around 9.1% year over year to $772.7 million on lower volumes, partly offset by higher pricing.

Winchester: Revenues increased 8.9% year over year to $439.9 million on higher commercial ammunition pricing.

Financials

Olin ended the second quarter with cash and cash equivalents of $304.6 million, up roughly 11.6% year over year. Long-term debt was $2,579.6 million at the end of the quarter, down around 23.7% year over year.

Outlook

Olin expects adjusted EBITDA for 2022 to be between $2.5 billion and $2.7 billion.

The company expects results in its Chemicals businesses in the third quarter of 2022to be lower than second-quarter levels, due to reduced participation in chlorine derivative markets and operating at lower rates combined with sequentially higher raw material and operating costs, especially higher natural gas and electrical power costs.

It expects third-quarter results in Winchester to be lower than second quarter 2022 levels due to increased commodity and other materials costs.  Overall, it expects third-quarter 2022 adjusted EBITDA to decline roughly 15% from second-quarter 2022 levels.

Price Performance

Shares of Olin have increased 13.5% in the past year against a 7.9% decline of the industry.

Zacks Investment Research
Zacks Investment Research


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Zacks Rank & Key Picks

Olin currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are Albemarle Corporation ALB, Cabot Corporation CBT and Sociedad Quimica y Minera de Chile S.A. SQM.

Albemarle has a projected earnings growth rate of 247% for the current year. The Zacks Consensus Estimate for ALB's current-year earnings has been revised 7.8% upward in the past 60 days.

Albemarle’s earnings beat the Zacks Consensus Estimate in each of the last four quarters. It has a trailing four-quarter earnings surprise of roughly 22.5%, on average. ALB has gained around 17.9% in a year and currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Cabot, currently sporting a Zacks Rank #1, has an expected earnings growth rate of 22.5% for the current year. The Zacks Consensus Estimate for CBT's earnings for the current year has been revised 6% upward in the past 60 days.

Cabot’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 16.2%. CBT has gained around 36.8% over a year.

Sociedad has a projected earnings growth rate of 513.7% for the current year. The Zacks Consensus Estimate for SQM’s current-year earnings has been revised 57.8% upward in the past 60 days.

Sociedad’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, the average being 28.2%. SQM has gained 103.2% in a year. The company sports a Zacks Rank #1.


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