Aristech, Vista declare first earnings - C&EN Global Enterprise (ACS

Jan 26, 1987 - Two chemical companies declared their first earnings since becoming publicly traded companies late last year. One of the companies—Vi...
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News of the Week schedule assumes that "each test will produce results that are expected and understood; there is little room in the schedule for modifying the design if this does not prove to be the case." Slay's panel makes a sim­ ilar comment. In fact, preliminary tests have al­ ready yielded results that were not expected for the redesigned booster field joints, the tang-and-clevis joints assembled in Florida before launch. Failure of an aft field joint caused the shuttle accident. NASA replaced the fluoroelastomer rubber used in the joint's O-rings with materials more resilient at low temperatures, such as nitrile and silicone rubbers. However, the new materials are found to deteriorate upon extended exposure to rust-inhibiting HD-2 grease. As a result, the redesign team has gone back to fluoropolymer O-rings, but with heaters to main­ tain an appropriate temperature (75 °F) at the field joints. This patchup approach introduces added complex­ ities and potential reliability prob­ lems, the panel stresses. Heaters can overheat joints, harming adhesive bonds, O-rings, or grease unpredict­ ably. So a priority effort should seek to develop a better combination of O-rings and grease. Substantial uncertainties remain in design changes for other booster parts besides the field joint, the pan­ el adds. It urges work on alterna­ tive designs for such parts. For the longer term, it calls for vigorous R&D on completely new designs: "The nation's manned space flight program cannot afford to continue to rely on older technology indefi­ nitely into the future." D

First monobactam antibiotic debuts The Food & Drug Administration has approved aztreonam for mar­ keting by Squibb Corp. as an in­ jectable antibiotic for treatment of infections by aerobic gram-negative bacilli. The company will produce the antibiotic for hospitals to treat nosocomial (hospital-acquired) in­ fections. Public health authorities estimate that 1.5 million of the 30 million 6

January 26, 1987 C&EN

patients admitted yearly to U.S. acute-care units in hospitals acquire bacterial infections there. Of those infections, 50% are caused by gramnegative bacilli. Persons most lia­ ble to get nosocomial infections are the elderly and cancer, organ trans­ plant, and heart disease patients. Aztreonam also represents a new chemical class of β-lactam antibiot­ ics. The compound is a 4-methyl-3acy laminoazetidinone-1 -sulfonic acid, which lacks the fused thiazolidine ring of penicillins or the thiazine ring of cephalosporins. Aztreonam does not induce bac­ terial biosynthesis of β-lactamases, which catalyze hydrolysis of peni­ cillins and cephalosporins. Physi­ cian Richard J. Duma of the Medi­ cal College of Virginia, Richmond, suggests that bacteria will thus be slow to develop resistance to aztreo­ nam. But he warns that bacteria eventually develop resistance to any antibiotic. Clinical tests indicate that the an­ tibiotic may be given safely to pa-

tients with a history of allergy to penicillins. About 10% of persons given penicillin become allergic to it, and these patients cannot take cephalosporins or many other forms of p e n i c i l l i n . But physician N. Franklin Adkinson Jr. of Johns H o p k i n s University's School of Medicine in Baltimore cautions that not enough studies have been done to learn whether some per­ sons will become sensitive to az­ treonam. Availability of aztreonam means that doctors may use it for gramnegative infections in place of ami­ noglycoside antibiotics, which cause kidney damage in about 10% of pa­ tients, and deafness and loss of bal­ ance in some others. A l t h o u g h aztreonam kills aerobic gram-nega­ tive bacilli, it spares other bacteria. This minimizes gastrointestinal dis­ turbances from indiscriminate kill­ ing of all intestinal bacteria. It also eliminates selective pressures on other bacteria in hospitals to devel­ op antibiotic resistance. D

Aristech, Vista declarefirstearnings Two chemical companies declared their first earnings since becoming publicly traded companies late last year. One of the companies—Vista Chemical—has been around since Du Pont divested itself of Conoco's chemical operations in a leveraged buyout, but did not go public until December. The other—Aristech Chemical—is a spinoff of most of the chemical assets of USX Corp., which also went public in December. Aristech, the larger of the two firms, reported net income in fourthquarter 1986 of $11.1 million, al­ most double the $5.6 million earned in the same period last year. Sales for the fourth quarter dropped al­ most 7% to $176 million. Thus, prof­ it margins at the company rose to 6.3% in the fourth quarter from just 3.0% in the same period of 1985. The results are based on historical data from USS Chemicals, the chem­ ical subsidiary of USX, for the peri­ od before Dec. 3, and from Aristech for the remainder of the period. Vista reported earnings of $8.6 million for its first fiscal quarter ended Dec. 31, more than 18 times

its earnings in the comparable quar­ ter of 1985. Quarterly sales increased 8%, and the profit margin rose to 6.6% from only 0.3% a year earlier. Both firms credited lower feed­ stock costs with much of the im­ provement. John Burns, Vista's presi­ dent and chief executive officer, says: "The results show a continua­ tion of positive trends that we've seen in our business over the previ­ ous three quarters." These trends for the big polyvinyl chloride pro­ ducer include lower hydrocarbon feedstock costs and higher PVC prices. Lower interest expense also helped earnings in the quarter. Aristech chairman Thomas Mar­ shall comments: "There are a num­ ber of factors influencing our re­ sults for 1986, including lower feed­ stock costs, higher operating rates, stronger domestic and internation­ al markets, and the strengthening of certain foreign currencies rela­ tive to the U.S. dollar." Marshall also says that "many of the same elements that influenced Aristech's results in 1986 are expected to con­ tinue in 1987." D