Eastman Chemical sees Q3 adjusted EPS ‘bit lower’ than $1.25, consensus $1.25

While presenting at Morgan Stanley’s Laguna Conference, executives from Eastman Chemical (EMN) stated, according to a transcript of the event: “The visibility in the order books is a couple of weeks at best at this point. And as you think about a more normal or stable environment that would typically be about six weeks. So customers right now are buying smaller quantities, more frequently. As you think about what we had outlined as we expected, progression through the quarter on the order books and you know, the way I would summarize it right now is we’re a little bit behind in the order books and maybe I can go in market by in market. So as you look at the automotive, we had guided that second half would be below first half. And I would say that’s actually performing a bit better than we had expected. And Q3 looks a lot like the first half. As I look at the durables market, I would say that’s lagging a little bit compared to our expectations. It’s a little slower based on the momentum that we’re seeing today and building and construction. What I would highlight and the last discretionary market for us is it’s basically stable, but it’s stable at current low levels. Obviously, we’re doing everything that we can in the quarter on the cost front, as you take that into account . Also, I would highlight that our chemical intermediates, the margins, there are probably a little bit behind as well. So taking that cost actions to offset as much as possible demand as well as the the spreads and chemical intermediates. Also, as we think about September, it’s always important in the quarter to achieve the full results. And our businesses are focused on closing out the quarter strong. But as we summarize that and take it all together, I would expect Q3 to be a bit lower than the approximately $1.25 for the quarter. While we can’t, as we talked about, have a little bit of low visibility as we think about Q4, we can give some directional comments as we think about Q4, we should have positive tailwinds with reduced impacts from both utilization as we’re taking inventory actions here in Q3 and also as we have reduced planned maintenance in Q4. As we look at Q4, typically primary demand is lower compared to Q3, and we think that’s going to more than offset the tailwinds that we’re seeing sequentially. So in Q4, the way I would summarize it is we’re going to be slightly below our Q3 expectations sequentially.”