The company's 2Q results have been negatively impacted by volatility in demand and pricing for certain products primarily as a result of the depressed economy in Europe. In addition to lower than expected product pricing and profitability from its European operations, sales volumes and prices for phthalic anhydride, carbon pitch, and creosote in North America were negatively impacted by lower priced European imports.
Additional factors impacting the company's phthalic anhydride volumes included unplanned production outages by certain customers and delays in customer orders as a result of anticipated reductions in pricing. Profit for the quarter was also negatively impacted by wet weather in the Eastern United States that reduced demand for certain seasonal products for the Carbon Materials and Chemicals business.
Walter W. Turner, President and CEO of Koppers, said, "While the long-term market fundamentals for our core products continue to be attractive on a global basis, the near-term health of those markets has deteriorated further during the second quarter. The volatile economic situation in Europe, which has affected our financial results for the past four quarters, is also impacting our North American markets through increased imports of carbon and chemical products that have placed significant stress on product pricing and volumes."
Mr. Turner continued, "I am confident that these are short-term issues; however, we expect that the current volatility will continue through the remainder of 2013 and begin to stabilize in 2014. I anticipate that the second half of 2013 will be better than the first half as we continue to implement various initiatives to reduce costs and improve profitability. We are currently working on several projects aimed at both top and bottom line growth and expect to have several announcements during the balance of the year outlining more specific plans."
Koppers, with corporate headquarters and a research center in Pittsburgh, Pennsylvania, is a global integrated producer of carbon compounds and treated wood products.
