Cabot returns to profit in Q4 and full year.

Boston, Massachussetts - Cabot Corp. has reported net income of $88 million for the 12 months ended 30 Sept, 2006. This is compared to a net loss of $48 million for the full fiscal year 2005. In the carbon black business, Cabot converted a loss of $4 million in the last quarter of 2005 into a profit of $35 million in the three months ended September 2006.

Sales volume jumped 41 percent in Cabot's rubber blacks business, to $1378 million in 2006, from $976 million in 2005. This represents 65 percent of the sales volume of the carbon black activity. Cabot does not break out profit for the different units within its carbon black business, but the carbon black business as a whole increased its profit to $105 million from $94 million for the 12 month period.

Commenting on the results, Kennett Burnes, Cabot's Chairman and CEO, said, "During the fourth quarter, rubber blacks and performance products returned to more normal levels of operations and profitability. Volume growth in rubber blacks remained strong with continued growth in our developing regions and a less than typical seasonal slowdown.

"Unit margins in performance products continued to improve due to price increases throughout the year and both rubber blacks and performance products benefited from lower feedstock prices, which positively impacted the business, principally in North America.

"Additionally, over the course of the past 12 to 18 months rubber blacks and performance products operated with significantly fewer days of inventory. During the fourth quarter of fiscal 2005 these efforts, along with other inventory charges, resulted in a $16 million unfavorable impact on profitability. As the inventory reduction was essentially completed by the fourth quarter of fiscal 2006, there was not a similar expense during the quarter. Cabot Japan had a positive impact on the Company's operating profits during both the fourth quarter and full fiscal year."

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Press release from Cabot