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What: Shares of chemical and building product maker Axiall Corp dropped as much as 10% today after it reported first-quarter earnings.
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So what: Revenue dropped 5% in the quarter to $947.6 million and the company lost $10.6 million, or $0.15 per share. If you pull out one-time items like merger-related charges, the loss was $0.05 per share, which was worse than the break-even results analysts expected.
Now what: The chlorovinyls and aromatics businesses struggled during the quarter on lower prices broadly in both businesses, which was partially offset by lower input costs. Building products, on the other hand, grew 8% to $166.4 million in revenue, although adjusted EBITDA for the segment was only $0.8 million.
A decline in chlorovinyls and aromatics is no surprise with oil prices down from a year ago, but the fact that the company is losing money in a low feedstock environment is troubling. I wouldn't be a buyer of Axiall today and want to see better profitability before changing that tune.
The article Why Axiall Corp's Shares Plunged 10% Today originally appeared on Fool.com.
Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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