Shirleen holds CBT 31.77: Management has made a conscious effort to identify and capture cost savings across every aspect of the business which has boosted gross margins.

The aggregate $50 million improvement program is focused on new procurement initiatives, product rationalization, new investment projects, transportation and warehousing improvements, and IT enhancements. We also expect the company to maintain its active mergers and acquisitions effort with CCC adding accretive and tuck-in purchases that are close to its core business in all regions. The company is also converting the Suzhou, China, potable reactivation kiln to Industrial end-market usage where capacity is currently very tight. The company also announced the recent Neville Island renovation and expansion which should add 12mm additional pounds by late next year. Given the growth in the size of the market, we see the company investing in capacity as generating a solid return on invested capital.


Leanne:
As such, we think the market opportunity size will rise to 200-250mm pounds, below the level that would have materialized if the SCOTUS had not overturned the law.

Maris:
We think that states will now respond with similar caps of their own, what we noted already exists in 19 states and in Canada.

Joie:
In aggregate, we think just one quarter of revenue could be susceptible to economic contractions.

Rosemary:
Other sources of revenue including food and air pollution accounting for 28% of revenue, which we believe are also fairly insulated from macroeconomic events.

Aleen:
We also like the defensiveness of the business with 46% of 2014 revenue coming from municipal sources, which would likely be unaffected by an economic downturn.

Hortense:
If adopted, the benefit will be felt significantly within the company's ballast water equipment line with CCC having significant capacity to take advantage of the expected volume increases across the product lineup.

Tayna:
Lastly, the International Maritime Organization has been pushing for ratification of the Ballast Water Convention.

Enid:
Brazil could be another opportunity should the macro picture improve as import tariffs there do not include reactivation services, which only require it to pay import duties.

Shayne:
We think the opportunity for Calgon moving more of these municipalities to reactivated carbons is substantial as it will free up capacity for other end-markets where activated carbon products cannot be reactivated.

Ranee:
In the US, there are approximately 400 municipal drinking water utilities that are currently using granular activated carbon, with approximately 25% using reactivated carbons.

Cabot Corp. (NYSE:CBT)
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