Cabot (US:CBT)2025-02-06 22:11Financial Performance - In the first quarter of fiscal 2025, net sales and other operating revenues decreased by $3 million to $955 million compared to $958 million in the first quarter of fiscal 2024, primarily due to less favorable pricing and product mix [75]. - Gross profit increased by $17 million to $235 million in the first quarter of fiscal 2025, driven by higher volumes in both Reinforcement Materials and Performance Chemicals segments [76]. - Total segment EBIT rose to $175 million in the first quarter of fiscal 2025, compared to $163 million in the same period of fiscal 2024, reflecting improved operational performance [85]. - Net income attributable to Cabot Corporation increased to $93 million ($1.67 per diluted common share) in the first quarter of fiscal 2025, up from $50 million ($0.88 per diluted common share) in the first quarter of fiscal 2024 [83]. - Other income increased by $30 million in the first quarter of fiscal 2025, primarily due to lower foreign exchange losses in Argentina [79]. Expenses and Taxation - The effective tax rate for the first quarter of fiscal 2025 was 28%, with a provision for income taxes of $41 million, compared to a provision of $34 million in the same period of fiscal 2024 [79]. - Research and technical expenses decreased by $1 million to $14 million in the first quarter of fiscal 2025 compared to $15 million in the same period of fiscal 2024 [78]. - Selling and administrative expenses decreased by $1 million to $66 million in the first quarter of fiscal 2025 compared to $67 million in the same period of fiscal 2024 [77]. - Interest expense decreased by $4 million to $18 million in the first quarter of fiscal 2025, attributed to lower average short-term borrowings and interest rates [79]. - The company expects the operating tax rate for fiscal 2025 to be in the range of 27% to 29% [80]. Segment Performance - Reinforcement Materials sales decreased by $30 million to $611 million in Q1 fiscal 2025 compared to $641 million in Q1 fiscal 2024, primarily due to less favorable pricing and product mix [90]. - EBIT for Reinforcement Materials increased by $1 million to $130 million in Q1 fiscal 2025, driven by approximately 1% volume growth [91]. - Performance Chemicals sales increased by $26 million to $311 million in Q1 fiscal 2025, primarily due to higher volumes and favorable foreign currency translation [93]. - EBIT for Performance Chemicals increased by $11 million to $45 million in Q1 fiscal 2025, primarily due to 8% higher volumes [94]. Cash Flow and Investments - Cash provided by operating activities totaled $124 million in Q1 fiscal 2025, compared to $105 million in Q1 fiscal 2024 [103]. - Investing activities consumed $104 million in Q1 fiscal 2025, compared to $54 million in Q1 fiscal 2024, with $77 million allocated for capital expenditures [106]. - Capital expenditures for fiscal 2025 are expected to be between $250 million and $300 million for sustaining and growth-related projects [108]. - Liquidity position decreased by $118 million during the first three months of fiscal 2025, with cash and cash equivalents at $183 million and borrowing availability of $1.1 billion [97]. Future Outlook - The company anticipates modest sequential improvement in EBIT for both Reinforcement Materials and Performance Chemicals segments in Q2 fiscal 2025 [92][95]. - The company is assessing potential impacts from tariffs announced in February 2025, expecting minimal direct impact in China and Mexico [96].