This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

W.R. Grace's CEO Discusses Q2 2012 Results - Earnings Call Transcript

Third, we had strong margins due to continued focus on items above and below the gross margin line. Gross margin continued at the high end of our target range of 35% to 37%. For the first six months of 2012, our gross margin of 36.8% is 60 basis points better than full year 2011 and 130 basis points better than full year 2010. Adjusted EBITDA margin was 21% for the quarter.

I’m also pleased with the strong margins in the Materials Technologies and Construction Product segments. As you remember, we stumbled a bit in Material Technologies in Q1. In Q2, we improved our performance with targeted sales gains, operational improvements and cost controls. And our operating margin improved 380 basis points sequentially.

Construction Products had higher sales volume, which translated into better operating leverage and higher margins. Gross margins were 35.1% and operating margins were 13%. We achieved these results in an operating environment which is clearly more difficult than we initially projected for 2012.

The most significant change and challenge to our original plan is the uncertainty coming from Europe. We saw this in weaker end market demand and unfavorable currency impacts. We also lost some FCC catalyst sales due to refinery closures in the mature markets. These closures are part of the global shift in refining capacity to the emerging regions where demand for transportation fuels is growing the fastest. We have anticipated this trend and plan to add FCC catalyst capacity in Abu Dhabi and China in response.

As the industry works through this regional shift of capacity, we will see some short-term impact to sales. But we are confident in our ability to maintain our industry leadership position given our strong value proposition and global presence.

Our businesses are managing well in the more challenging environment and we affirm our full year outlook for adjusted EBIT in the range of $510 million to $530 million.

3 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,712.66 +34.43 0.19%
S&P 500 2,061.02 +4.87 0.24%
NASDAQ 4,891.2190 +27.8570 0.57%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs