UPDATE 1-Eastman Chemical Q3 earnings rise

Published: 22 Oct 2009 17:36:34 PST

* Sales fall 26.5 percent

* Stock up 3.2 percent in after-hours

NEW YORK, Oct. 22 - Eastman Chemical Co <EMN.N> said on Thursday that cost cuts helped it post a modest increase in third-quarter profit as sales fell.

Results beat Wall Street's expectations.

The company said it expects fourth quarter earnings per share to decline sequentially, but to be slightly above the high end of analysts' estimates, which is 85 cents per share.

For the third quarter, the company said net income rose to $101 million, or $1.38 per share, from $100 million, or $1.33 per share, in the year-ago period.

Analysts expected earnings of $1.13, according to Thomson Reuters I/B/E/S estimates.

Sales fell 26.5 percent to $1.34 billion. Analysts expected revenue of $1.33 billion.

A 33 percent dip in the cost of sales helped offset the revenue drop.

Shares rose $1.81, or 3.2 percent, to $58 in after-hours trading.