Covington-based Ashland announced its fiscal third quarter earnings Friday that included a 30.6 percent drop in profit.
The specialty chemical company said it earned $50 million, or 66 cents per share, on $2.04 billion in revenue. A year ago, it earned $72 million, or $1.13 a share, on $2.2 billion in revenue.
Its Consumer Markets division, which includes Lexington-based Valvoline, was the only one of Ashland's divisions to grow revenue year-over-year.
The company's overall earnings were affected by a number of items, including $16 million in pre-tax charges related to cost-reduction programs. The company also took a $10 million pretax, non-cash charge related to the retirement of a bridge loan and sustained an $8 million unfavorable tax judgment in a foreign country that reduced earnings per share by 10 cents.
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In announcing the earnings, Chairman and CEO James J. O'Brien emphasized the company's focus on reducing costs.
"It appears that demand could remain flat for the foreseeable future," O'Brien said in a statement. "We will continue to manage our pricing, reduce our costs, and apply the cash we generate to reduce debt."
In good news for the quarter, the Consumer Markets division grew sales 3 percent year-over-year to $441 million. The company said lubricant volume increased 4 percent, primarily because of an increase in sales in the do-it-yourself market.
Also, sales at Valvoline Instant Oil Change stores that have been open at least a year increased 6 percent.
The division also benefited from lower raw material costs, cost-savings initiatives and shift in the sales mix toward premium brands.
Ashland's other divisions all saw sales declines of at least 20 percent year-over-year.
The biggest decline came at Ashland Performance Materials, which markets specialty resins and adhesives for markets including construction and transportation.
Its revenue fell 40 percent to $256 million. Those results were also boosted because of the acquisition of a line of business from Air Products in 2008. Without that addition, revenue would have fallen 46 percent. The company attributed the decline to weak demand.