DOW JONES NEWSWIRES
Lubrizol Corp.'s (LZ) second-quarter earnings fell 5% as costs,
foreign exchange and taxes weighed on the specialty-chemical
company's profitability.
Lubrizol, which makes industrial lubricants as well as additives
for engine oils and consumer products, reiterated that it faced
disadvantages from higher raw-material and manufacturing costs and
added that other expenses, reduced foreign-exchange gains and
higher taxes exerted pressure.
However, it again reported improved prices, favorable product
mix and better volume, as it did in the prior quarter. It said the
latest period's per-share earnings benefited from a lower number of
shares outstanding.
Lubrizol is on its way to merging with billionaire Warren
Buffett's Berkshire Hathaway Inc. (BRKA, BRKB), in a deal worth
roughly $9 billion. David Sokol, a Berkshire executive who
suggested the purchase to Buffett and who was once considered by
many to be Buffett's likely successor, resigned because of
questions about his purchases of Lubrizol stock before the
companies sealed the agreement.
Lubrizol posted a profit of $191.3 million, or $2.90 a share,
compared with $201.4 million, or $2.88 a share, a year earlier. The
latest results included merger-and-restructuring charges of 1 cent
a share. It had 5.3% fewer shares outstanding in the latest
period.
Revenue increased 17% to $1.63 billion.
Analysts surveyed by Thomson Reuters expected earnings of $3.06
a share on revenue of $1.51 billion.
Gross margin fell to 30.7% from 33.8%.
Shares closed Tuesday down 2 cents at $134.65. Through the
close, the stock has risen 26% so far this year, better than the
wider market.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com