FMC Guides Q3 Revenue to Just $65M-$125M, a Fraction of Prior Levels
FMC is trading near its 52-week low of $8.035 (0.9% above the low).
Summary
FMC told the market to expect third-quarter revenue of only $65M-$125M, a stunningly low range for a company that was generating hundreds of millions per quarter earlier this year, and now sees negative adjusted EBITDA of $510M-$565M for the quarter. The stock fell 38% to $4.89 premarket, far below Wall Street's expected Q3 sales of $869M and EBITDA of $133M, and CEO Pierre Brondeau said third-quarter demand was weaker than expected, driven by challenging market conditions and elevated levels of higher-priced FMC products held in inventory. The company is taking $625M-$675M in pricing actions to lower the price of select products held by channel customers in key markets and to modify its selling and pricing model in the U.S., as elevated levels of higher-priced products held in inventory by certain channel customers limit product movement and replenishment demand. It follows the July 29 Q2 report, when FMC swung to a $186M net loss and slashed full-year guidance, and the September 23 close of a $403M strategic investment from Tessenderlo Group that handed the buyer roughly 20% of the company. FMC expects to be in compliance with covenants at Sept. 30, and with a market cap near $1.26B the dilution from the Tessenderlo deal leaves little equity cushion. Watch the full Q3 release and any further guidance revision for whether the low end of the range holds.
Updated with a Dow Jones Newswires report · What changed
Updates
· Dow Jones Newswires — FMC stock fell 38% to $4.89 premarket; Wall Street had expected Q3 sales of $869M and EBITDA of $133M.
- CEO Pierre Brondeau said third-quarter demand was weaker than expected, driven by challenging market conditions and elevated levels of higher-priced FMC products held in inventory
At the time of this announcement, FMC was trading at $8.11 on NYSE in the Industrial Applications And Services sector, with a market capitalization of approximately $1.3B. The 52-week trading range was $8.04 to $31.30. This news item was assessed with negative market sentiment and an importance score of 10 out of 10. Source: Dow Jones Newswires.