Eastman Chemical Plant Closure to Harm Q1 Profit

Eastman Chemical said a recent shutdown at a Texas plant will likely cut first-quarter earnings by at least 20 cents per share. The Kingsport, Tenn.-based company had previously announced a power outage at its Longview, TX, plant.

When the plant was being restarted, an "unexpected equipment breakage" connected to a cracking unit delayed the start-up and stymied production.

Eastman expects the closure of two crackers, devices that break down petroleum into a simpler state, to lower first-quarter earnings by 20 cents to 25 cents per share. The company expects the outage to be offset by higher sales volume and margins, and said it has contacted its insurance carriers.

Eastman had previously forecast first-quarter earnings to be "slightly above" fourth-quarter earnings of $1.14 per share. Analysts expect first-quarter earnings of $1.15 per share, according to Thomson Reuters I/B/E/S.

Eastman expects one small cracker to be online by the middle of March, with a larger cracker online by the end of the month