Ashland Global Holdings Inc. recently announced preliminary financial results for the second quarter of its 2020 fiscal year, ended March 31, 2020. The company reports that its portfolio performed as expected during the quarter, despite the global macroeconomic uncertainty brought on by the COVID-19 pandemic. Sales were $610 million, down 9% vs. the 2019 quarter, with the legacy Pharmachem business and previously communicated prior year business losses in oral care representing approximately half of this decline. Unfavorable foreign currency contributed an additional 1% to the decline. Net loss was $582 million compared to net income of $76 million in the 2019 quarter, driven primarily by the previously disclosed non-cash goodwill impairment charge following the business unit realignment that occurred during the quarter.
“Results in the second quarter were consistent with the update we issued on April 16,” said Guillermo Novo, chairman and CEO. “I am pleased with the leadership demonstrated by our teams and the continued progress we have made transforming the company, particularly in light of the challenges that arose from the COVID-19 pandemic. Many of the important end markets we serve are demonstrating their resilience despite the global-economic uncertainly.
“The majority of the portfolio continues to perform well. We expect Consumer Specialties and certain end markets within Industrial Specialties to demonstrate continued relative strength in the second half of the year as we are a critical technology and solutions provider to our customers in these key end markets. While increased global uncertainty is expected to impact demand in more industrial-focused businesses, we are confident that our continued self-help actions will offset many of these temporary demand dynamics. We are excited about the rapid progress we have made advancing our strategy and transforming the company. I want to thank everyone at Ashland for their dedication and leadership during these dynamic times.”
In the Consumer Specialties segment, sales were $343 million in the 2020 fiscal second quarter, down 9% from the 2019 quarter, with the legacy Pharmachem business and previously communicated prior year business losses in oral care representing approximately six percentage points of the decline. Unfavorable foreign currency also reduced sales by an additional 1%. Excluding these items, the Life Sciences and Personal Care & Household business units performed well during the quarter, demonstrating the market positions Ashland holds in end markets that are performing well in spite of the weak overall economy.
The Industrial Specialties segment saw sales decrease 7% in the 2020 second fiscal quarter, to $240 million. The decline was reportedly primarily due to lower demand in certain industrial end markets and reduced pricing, partially reflecting lower raw material costs. Unfavorable foreign currency also reduced sales by 1%.
Sales dropped 16% in the Intermediates & Solvents segment, to $37 million, due primarily to lower pricing and lower intercompany volume reflecting inventory management initiatives within Consumer Specialties. Volumes of derivatives sold to third-party customers grew by approximately 1% compared to the prior year’s quarter.
Additional details are available at www.ashland.com.