Shares of Olin (NYSE:OLN) were rising 14% in late afternoon trading Thursday after the company reported third-quarter earnings that beat analyst expectations on the top and bottom lines.
The specialty chemicals and ammunition maker actually saw sales and profits fall year over year. Business improved across the board from the second quarter, particularly in the important chlor alkali and vinyl business, which represents over 52% of total revenue. Epoxy sales, accounting for a third of the total, were down 7% on lower prices and volumes.
Conversely, the Winchester ammunition division saw sales rise year over year, and sequentially to $206.4 million on the outsized demand for firearms that's swept the country this year.
The National Shooting Sports Foundation says the FBI performed 67% more criminal background checks on potential gun buyers so far in 2020 than it did during the same period in 2019. More firearm sales means more ammo needed, and Olin reported Winchester sales were up 10% from last year.
Olin said pricing improved sequentially in the third quarter for chlorine and its new electrochemical unit, and it expects price increases it recently imposed for various chemicals will contribute to unit profits in the fourth quarter. Volumes, though, are expected to face headwinds.
There doesn't seem to be any let up in ammo demand, however, which is why fellow ammo maker Vista Outdoor also beat expectations today and is anticipating the trend to continue for some time to come.