Cabot reports stronger sales, earnings in reinforcement materials business

Boston, Massachusetts – Cabot Corp. has reported stronger annual sales and earnings (EBITDA) within its reinforcement materials division for the fiscal year 2024, ended 30 Sept.

The division, which includes reinforcing carbons for industrial rubber products and tires as well as engineered elastomer composites for rubbers and tires, posted a 9% year-on-year increase in earnings to $603 million (€563 million).

Sales for the 12-month period grew 1.8% to $2.6 billion, reflecting an overall 3% increase in volumes, Cabot reported 5 Nov.

Cabot linked higher earnings to ‘favourable pricing and product mix’ from 2024 contracts, which were partially offset by ‘a less favourable geographic mix.’

Over the final three months of the fiscal year, however, the business unit posted a decline in earnings, due to ‘higher fixed costs, driven by maintenance and third-party spending.'

For the three-month period, the division reported a 7.8% year-on-year decline in earnings to $140 million on 3.2% higher sales of $644 million.

During the quarter, volumes in the Americas were impacted by production interruptions in Altamira, Mexico, in the summer, due to severe drought in the region.

Americas volumes were down 7% year-on-year during the fourth quarter, also due to lower production by tire manufacturers in the face of high Asian imports.

By contrast, volumes in Asia-Pacific and Europe increase 4% and 3% respectively, leading to a 1% overall decline in volumes over the three-month period.

As for the outlook for reinforcement materials, Cabot said demand remained ‘resilient’ with an expected 2-3% compound average growth rate.

The company also expects to report higher earnings in the first quarter of 2025, driven by $10 million lower costs compared to the preceding quarter.