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.
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.