Ashland Inc. Reports $165 Million Net Loss and Revenue Decline in Latest Quarter

Ashland Inc. reported a significant financial downturn in its latest quarterly results, with a net loss of $165 million for the three months ending December 31, 2024, compared to a net income of $26 million in the same period last year. This translates to a diluted loss per share of $3.50, a stark contrast to the previous year's earnings of $0.51 per share. The company's operating loss also widened to $179 million from $18 million, primarily driven by a $183 million impairment charge related to the planned divestiture of its Avoca business.

Total revenue for the quarter fell to $405 million, down from $473 million in the prior year, marking a decrease of $68 million. The decline was attributed to several factors, including the impact of divestitures, lower sales volumes, unfavorable pricing, and adverse foreign currency exchange rates. The Life Sciences segment experienced the most significant drop, with sales decreasing from $200 million to $134 million, while Personal Care saw a slight increase in sales from $129 million to $134 million. Specialty Additives reported a decrease in sales from $122 million to $115 million, and Intermediates remained stable at $33 million.

In terms of operational developments, Ashland is in the process of selling its Avoca business to Mane SA, with the transaction expected to close in the second quarter of fiscal 2025, pending regulatory approvals. The company has also initiated a $30 million restructuring plan aimed at offsetting the impact of the Nutraceuticals business sale and optimizing its portfolio. This restructuring is expected to yield significant cost savings over the next two fiscal years.

Ashland's cash flow from operating activities showed a negative trend, with a cash outflow of $30 million compared to a positive inflow of $201 million in the previous year. The company ended the quarter with cash and cash equivalents of $219 million, down from $300 million at the end of the previous quarter. The decrease in cash was primarily due to dividend payments and capital expenditures. Additionally, Ashland's total debt stood at $1.313 billion, with a debt-to-capital ratio of 34%, reflecting a slight increase from 32% in the prior quarter.

Looking ahead, Ashland maintains a cautious outlook, projecting full fiscal year sales between $1.90 billion and $2.05 billion, with Adjusted EBITDA expected to range from $430 million to $470 million. The company is closely monitoring market conditions, particularly in Europe, and is prepared to adapt its strategies in response to potential geopolitical and economic shifts.