KINGSPORT, Tenn., March 3, 2010 –On February 20, Eastman Chemical Company (NYSE:EMN) experienced a power outage resulting in a shutdown at its Longview, Texas, site as previously announced. During restart operations late last week, an unexpected equipment breakage connected to one of the two operating cracking units at the site delayed startup and is interrupting production of certain products and intermediates.
The company is working directly with customers on supply plans and is assessing the duration of the outage. Based on current information, the company expects to have the smaller of the two crackers online by mid-March and the larger cracker online before the end of March. The company has notified its insurance carriers of the outage as part of the claims assessment process.
Based on the current timeline for restarting the crackers, the company expects the impact of the outage on first-quarter 2010 earnings per share to be between $0.20 and $0.25. This impact is expected to be mostly offset by higher than forecasted sales volume and operating margin. Segments affected by the outage are Performance Chemicals and Intermediates (PCI) and Coatings, Adhesives, Specialty Polymers and Inks (CASPI).
“We take our commitment to being a reliable supplier to our customers seriously and are working hard to resolve this unusual situation and restore supply as soon as possible,” said Ron Lindsay, executive vice president, performance polymers and chemical intermediates. “We recognize the impact this outage is currently having on our customers, and we deeply appreciate the value they place on our long-term track record as a reliable supplier.”
Forward-Looking Statements: This news release includes forward-looking statements concerning the unplanned shutdown and production interruption at the company’s Longview, Texas, site, expected restart of the two operating cracking units at the Longview, Texas, site, projected first-quarter 2010 sales volume and operating margin for the company, and the projected impact on first-quarter 2010 earnings per share of the Longview, Texas, outage and the projected increased sales volume and operating margin. Such expectations are based upon certain preliminary information, internal estimates, and management assumptions, expectations, and plans, and are subject to a number of risks and uncertainties inherent in projecting future conditions, events, and results. Actual results could differ materially from expectations expressed in the forward-looking statements if one or more of the underlying assumptions or expectations prove to be inaccurate or are unrealized. Important factors that could cause actual results to differ materially from such expectations are and will be detailed in the company's filings with the Securities and Exchange Commission, including the Form 10-K filed for 2009 and available on the Eastman web site at www.eastman.com in the Investors, SEC filings section.
Eastman’s chemicals, fibers and plastics are used as key ingredients in products that people use every day. Approximately 10,000 Eastman employees around the world blend technical expertise and innovation to deliver practical solutions. The company is committed to finding sustainable business opportunities within the diverse markets it serves. A global company headquartered in Kingsport, Tenn., USA, Eastman had 2009 sales of $5 billion. For more information, visit www.eastman.com.