Arch Chemicals 1Q profit sinks on absence of 1-time gain

Arch Chemicals rose $2.70, or 7.7 percent, to $37.71 in morning trading.

Before the market opened, the company said its profit for the three months ended March 31 sank 61 percent, mostly due to the absence of a year-ago gain related to a government contract. The company earned $5.7 million, or 23 cents per share, compared with $14.6 million, or 60 cents per share, in the year-ago quarter. The 2007 period included a $12.8 million gain related to the completion of a contract with the U.S. government.

Revenue rose 9 percent to $347.1 million, from $317.4 million in the prior-year period.

Analysts, on average, were expecting a profit of 13 cents per share, on revenue of $339.3 million, according to a poll by Thomson Financial.

The company said sales were driven by growth in its industrial biocides and water products businesses. Its performance products segment, however, was hurt by an increase in oil-based raw materials costs.