Eastman plans strategic investmens for healthy growth

28-Jan-08
Eastman Chemical Company expects its recent strategic initiatives to result in a doubling of earnings per share to US$10 by 2012. Eastman expects its previously announced industrial gasification projects in Texas and Louisiana to contribute approximately $2 per share by 2012. Eastman's milestones for these projects include: Completing the front end engineering and design (FEED) process in the second half of 2008; Obtaining project financing by the end of 2008; Breaking ground in early 2009; Bringing the facilities online by 2011. Eastman expects the growth initiatives for its Specialty Plastics, Fibers and Performance Polymers segments to contribute about $3 per share by 2012. Eastman's milestones for improving profitability in Specialty Plastics: Converting 50,000 metric tons of PET capacity to copolyester by mid year 2008 and converting another 50,000 metric tons by 2010; Increasing revenue from cellulose esters used in LCD screens to US$100 million in 2009 from approximately US$50 million in 2007; and Continued progress with the commercialization of its high performance copolyesters, such as Eastman Tritan™ copolyester, which has been well received since its November 2007 launch. For Performance Polymers, the company expects low single digit positive operating margins for full year 2008 and to approach 10% operating margins for full year 2009. To achieve these results, Eastman expects to: Close the sale of its remaining European PET manufacturing facilities by the end of the first quarter of 2008, completing the divestitures of non-strategic PET manufacturing facilities outside the U.S.; Shut down another 300 thousand metric tons of conventional PET polymers capacity at the South Carolina manufacturing facility by mid year 2008, resulting in over 400,000 metric tons of reduced conventional PET capacity since 2007; Complete the shutdown of Eastman's less efficient DMT intermediates assets at the South Carolina facility and increase PTA intermediates capacity by the middle of 2008; Eliminate approximately US$30 million of annual costs at the South Carolina site by the middle of 2008; and Expand PET capacity based on IntegRex technology at the South Carolina facility by 50% by the end of 2008.
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