Ashland profit plummets due to one-time items

Covington-based Ashland Inc. announced quarterly earnings Tuesday that saw an increase in sales but a decline in profit. The results were dragged down by one-time items and a tough comparison with last year, when the company benefited from a gain on the sale of its distribution business.

The specialty chemicals company earned $88 million, or $1.10 a share, in its fiscal second quarter, which ended March 31. That's down 82 percent from $485 million, or $6.02 a share, in the same period a year earlier. Numerous one-time items factored into the huge difference. For instance, last year, the sale of the company's distribution business added a gain of $231 million.

In the most recent quarter, a series of issues including a change in inventory valuation, also dragged down profit by $31 million.

Sales in the most recent quarter increased 34 percent as the company benefited from its acquisition in the past year of International Specialty Products. Had the company owned ISP a year ago, sales would have risen 2 percent, the company said in a statement.

"Our overall business continues to perform well, with increased sales, stable margins and improved cash flow during the quarter despite some market weakness in certain commercial units," chief executive James J. O'Brien said in a statement. "With last year's acquisition of International Specialty Products, we have strengthened our position in higher-margin growth markets and we are seeing the benefit to our bottom-line results."

The company's consumer markets division, which includes Lexington-based Valvoline, garnered $520 million in sales, up 6 percent from $491 million a year ago.

Mirroring the company overall, though, its operating income fell from $64 million a year ago to $57 million.