NYSE$ASH

Ashland Inc · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

Ashland reported strong financial results for the third quarter of fiscal year 2022, consistent with the previous update.

Ashland's Q3 2022 results showed strong sales growth of 19% year-over-year, driven by disciplined pricing and improved product mix. Adjusted EBITDA increased by 35% compared to the prior-year quarter. The company raised its outlook for sales and Adjusted EBITDA for the full fiscal year 2022.

  • Sales reached $644 million, a 19% increase from the prior-year quarter.
  • Net income was $36 million, or $0.65 per diluted share.
  • Adjusted income from continuing operations excluding intangibles amortization expense was $104 million, or $1.89 per diluted share.
  • Adjusted EBITDA was $174 million, up 35% from the prior-year quarter.

Headline financials

Total Revenue

$644M

Previous: $637M+1.1%
EPS (adj)

$1.89

Previous: $1.22+54.9%
Capital Expenditures

-$67M

Previous: -$77M+13.0%
Free Cash Flow

-$31M

Previous: $3M-1133.3%
Net Income

$36M

Previous: $80M-55.0%
Operating Income

$77M

Previous: $62M+24.2%
Gross Profit

$240M

Previous: $198M+21.2%
Cash & Equivalents

$629M

Previous: $262M+140.1%
Total Assets

$6.41B

Previous: $6.77B-5.2%
Stock-Based Comp

$5M

Previous: $4M+25.0%

Revenue & EPS history

Ashland · Revenue · Quarterly

$644M

Q3 2022+1.1%vs Q3 2021
Beat estimate in 4 of 15 quarters(27%)
ActualEstimate

Revenue by segment

Ashland · $667M total across 4 segments · Q3 2022

  • Life Sciences
    $228M+18.1%
  • Specialty Additives
    $194M+14.8%
  • Personal Care
    $172M+17.0%
  • Intermediates
    $73M+49.0%

Forward guidance

Ashland expects greater sales and Adjusted EBITDA in fiscal year 2022 compared to its previous outlook. Sales are expected to be in the range of $2.35 billion to $2.40 billion, and Adjusted EBITDA is expected to be in the range of $580 million to $590 million.

Tailwinds

  • Underlying near-term demand to remain strong for our focused ingredients and additives product portfolio.
  • Continue to build inventories to mitigate supply-chain and shipping challenges.
  • Pricing and mix-improvement actions should cover current cost inflation.
  • The Ashland team is prepared to take further action to recover any additional cost inflation, both this year and beyond.
  • The company has raised its outlook for sales and Adjusted EBITDA in this fiscal year due to the strong results demonstrated through the first three quarters

Headwinds

  • The war in Ukraine.
  • The strengthening U.S. dollar and broader foreign currency headwinds.
  • Energy cost and availability in Europe impacting customer and supplier operations.
  • Additional pandemic-related lockdowns.
  • Global supply-chain and shipping challenges and continued cost-inflation pressures.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2022

Historical avgQ3 2022

-0.4%

Avg return

Earnings day

-0.7%

Avg return

5 days after

+0.8%

Avg return

30 days after

45%

29 / 64 earnings

Positive

+15.9%

Q1 2024

Best reaction

-10.2%

Q2 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q2 2026+8.4%+6.3%+17.7%
Q1 2026-0.8%+4.2%-6.8%
Q4 2025-1.0%-1.3%+15.5%
Q2 2025-9.9%-11.5%-9.0%
Q1 2025-9.8%-14.4%-14.5%
Q4 2024-5.0%-7.3%-11.2%
Q3 2024-3.2%-6.5%-7.4%
Q2 2024-2.6%-1.2%+2.7%
Q1 2024+15.9%+13.4%+15.9%
Q4 2023-4.8%+0.8%+7.3%
Q3 2023+0.1%+1.3%-6.9%
Q2 2023-10.2%-9.5%-15.0%
Q1 2023+1.5%-1.4%-3.8%
Q4 2022+7.9%+8.0%+11.9%
Q3 2022-2.5%-4.3%+1.5%
Q2 2022+4.7%+3.5%+4.3%
Q1 2022+1.2%-0.8%-5.9%
Q4 2021+1.4%+7.4%+5.3%
Q3 2021-3.9%-3.1%-2.3%
Q2 2021-7.0%-7.3%+1.2%
Q1 2021+1.3%+2.3%+3.0%
Q4 2020-2.4%+3.9%-2.5%
Q3 2020-2.5%-5.2%-5.1%
Q2 2020-0.1%+5.3%+20.8%
Q1 2020+1.1%-1.8%+0.8%
Q4 2019-3.8%-8.6%-3.8%
Q3 2019+0.0%-3.5%-8.7%
Q2 2019-5.4%-4.9%-5.0%
Q1 2019+2.7%+2.0%+1.8%
Q4 2018+9.0%+8.5%+2.6%
Q3 2018+2.5%+3.9%+2.6%
Q2 2018+7.7%+10.6%+17.4%
Q1 2018+0.3%+2.0%-2.2%
Q4 2017-3.6%-3.9%+2.5%
Q3 2017-2.4%-2.3%-4.5%
Q2 2017-1.4%-2.5%+7.6%
Q1 2017+2.1%+2.2%+4.6%
Q4 2016-4.1%-5.3%+1.3%
Q3 2016-6.4%-6.7%-4.3%
Q2 2016-0.7%
Q1 2016-1.9%
Q4 2015-0.1%
Q3 2015-3.2%
Q2 2015-1.4%
Q1 2015+1.3%
Q4 2014+2.9%
Q3 2014-5.1%
Q2 2014+4.5%
Q1 2014-1.0%
Q4 2013-5.8%
Q3 2013+0.4%
Q2 2013-0.1%
Q1 2013+6.9%
Q4 2012+0.4%
Q3 2012-0.4%
Q2 2012+1.5%
Q1 2012+1.3%
Q4 2011-4.8%
Q3 2011+4.0%
Q2 2011+0.8%
Q1 2010+3.1%
Q4 2010-1.2%
Q3 2010-5.7%
Q2 2010+2.8%

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